You are on page 1of 57

G.R. No.

124320 March 2, 1999

ANNULMENT and/or DECLARATION OF NULLITY OF TCT NO. 493363, 493364, 493665,


493366, 493367; and its Derivatives; As Alternative Reconveyance of Realty WITH A
PRAYER FOR A WRIT OF PRELIMINARY INJUNCTION and/or RESTRAINING ORDER
WITH DAMAGES, docketed as RTC BCV-94-127 before Branch 21 of the Regional Trial
Court in Imus, Cavite.

HEIRS OF GUIDO YAPTINCHAY AND ISABEL YAPTINCHAY, NAMELY: LETICIA ENCISOGADINGAN, EMILIO ENCISO, AURORA ENCISO, AND NORBERTO ENCISO,
REPRESENTED BY LETICIA ENCISO-GADINGAN, ATTORNEY-IN-FACT, petitioners,
vs.
HON. ROY S. DEL ROSARIO, PRESIDING JUDGE, RTC, BRANCH 21, IMUS, CAVITE;
THE REGISTER OF DEEDS FOR TRECE MARTIRES CITY, GEORGE T. CHUA, SPS.
ALFONSO NG AND ANNABELLE CHUA, SPS. ROSENDO L. DY AND DIANA DY, SPS.
ALEXANDER NG AND CRISTINA NG, SPS. SAMUEL MADRID AND BELEN MADRID,
SPS. JOSE MADRID AND BERNARDA MADRID, SPS. DAVID MADRID AND VIOLETA
MADRID, JONATHAN NG, SPS. VICTORIANO CHAN, JR. AND CARMELITA CHAN, SPS.
MARIE TES C. LEE AND GREGORIE W.C. LEE, JACINTO NG, JR., SPS. ADELAIDO S.
DE GUZMAN AND ROSITA C. DE GUZMAN, SPS. RICARDO G. ONG AND JULIE LIM-IT,
SPS. MISAEL ADELAIDA P. SOLIMAN AND FERDINAND SOLIMAN, SPS. MYLENE T.
LIM AND ARTHUR LIM, EVELYN K. CHUA, GOLDEN BAY REALTY AND DEVELOPMENT
CORPORATION, respondents.

Upon learning that "Golden Bay" sold portions of the parcels of land in question, petitioners
filed with the "RTC" an Amended Complaint to implead new and additional defendants and to
mention the TCTs to be annulled. But the respondent court dismissed the Amended
Complaint.
Petitioners moved for reconsideration of the Order dismissing the Amended Complaint. The
motion was granted by the RTC in an Order 1 dated July 7, 1995, which further allowed the
herein petitioners to file a Second Amended Complaint, 2 which they promptly did.
On August 12, 1995, the private respondents presented a Motion to Dismiss 3 on the grounds
that the complaint failed to state a cause of action, that plaintiffs did not have a right of action,
that they have not established their status as heirs, that the land being claimed is different
from that of the defendants, and that plaintiffs' claim was barred by laches. The said Motion to
Dismiss was granted by the respondent court in its Order 4 dated October 25, 1995, holding
that petitioners "have not shown any proof or even a semblance of it except the allegations
that they are the legal heirs of the above-named Yaptinchays that they have been declared
the legal heirs of the deceased couple."

PURISIMA, J.:
At bar is a Petition for Certiorari under Rule 65 of the Revised Rules of Court assailing the
Orders dated October 25, 1995 and February 23, 1996, respectively, of Branch 21 of the
Regional Trial Court in Imus, Cavite ("RTC").

Petitioners interposed a Motion for Reconsideration 5 but to no avail. The same was denied
by the RTC in its Order 6of February 23, 1996.

The facts that matter are, as follows:


Undaunted, petitioners have come before this Court to seek relief from respondent court's
Orders under attack.

Petitioners claim that they are the legal heirs of the late Guido and Isabel Yaptinchay, the
owners-claimants of Lot No. 1131 with an area of 520,638 and Lot No. 1132 with an area of
96,235 square meters, more or less situated in Bancal, Carmona, Cavite.

Petitioners contend that the respondent court acted with grave abuse of discretion in ruling
that the issue of heirship should first be determined before trial of the case could proceed. It
is petitioners' submission that the respondent court should have proceeded with the trial and
simultaneously resolved the issue of heirship in the same case.

On March 17, 1994, petitioners executed an Extra-Judicial Settlement of the estate of the
deceased Guido and Isabel Yaptinchay.

The petition is not impressed with merit.

On August 26, 1994, petitioners discovered that a portion, if not all, of the aforesaid properties
were titled in the name of respondent Golden Bay Realty and Development Corporation
("Golden Bay") under Transfer Certificate of Title Nos. ("TCT") 225254 and 225255. With the
discovery of what happened to subject parcels of land, petitioners filed a complaint for

To begin with, petitioners' Petition for Certiorari before this Court is an improper recourse.
Their proper remedy should have been an appeal. An order of dismissal, be it right or wrong,

is a final order, which is subject to appeal and not a proper subject of certiorari. 7 Where
appeal is available as a remedy certiorari will not lie. 8

proceeding is "a remedy by which a party seeks to establish a status, a right, or a particular
fact." It is then decisively clear that the declaration of heirship can be made only in a special
proceeding inasmuch as the petitioners here are seeking the establishment of a status or
right.

Neither did the respondent court commit grave abuse of discretion in issuing the questioned
Order dismissing the Second Amended Complaint of petitioners, as it aptly ratiocinated and
ruled:

We therefore hold that the respondent court did the right thing in dismissing the Second
Amended Complaint, which stated no cause of action. In Travel Wide Associated
Sales (Phils.), Inc. v. Court of Appeals, 11 it was ruled that:

But the plaintiffs who claimed to be the legal heirs of the said Guido and
Isabel Yaptinchay have not shown any proof or even a semblance of it
except the allegations that they are the legal heirs of the aforementioned
Yaptinchays that they have been declared the legal heirs of the deceased
couple. Now, the determination of who are the legal heirs of the deceased
couple must be made in the proper special proceedings in court, and not in
an ordinary suit for reconveyance of property. This must take precedence
over the action for reconveyance (Elena c. Monzon, et al., v. Angelita
Taligato, CA-G-R- No. 33355, August 12, 1992).

. . . If the suit is not brought in the name of or against the real party in
interest, a motion to dismiss may be filed on the ground that the complaint
states no cause of action.
WHEREFORE, for lack of merit, the Petition under consideration is hereby DISMISSED. No
pronouncement as to costs.
SO ORDERED.

In Litam, etc., et. al. v. Rivera this court opined that the declaration of heirship must be
made in an administration proceeding, and not in an independent civil action. This doctrine
was reiterated in Solivio v. Court of Appeals 10 where the court held:
In Litam, et al. v. Rivera, 100 Phil. 364, where despite the pendency of the
special proceedings for the settlement of the intestate estate of the deceased
Rafael Litam, the plaintiffs-appellants filed a civil action in which they claimed
that they were the children by a previous marriage of the deceased to a
Chinese woman, hence, entitled to inherit his one-half share of the conjugal
properties acquired during his marriage to Marcosa Rivera, the trial court in
the civil case declared that the plaintiffs-appellants were not children of the
deceased, that the properties in question were paraphernal properties of his
wife, Marcosa Rivera, and that the latter was his only heir. On appeal to this
Court, we ruled that "such declarations (that Marcosa Rivera was the only
heir of the decedent) is improper, in Civil Case No. 2071, it being within the
exclusive competence of the court in Special Proceedings No. 1537, in which
it is not as yet, in issue, and, will not be, ordinarily, in issue until the
presentation of the project of partition." (p. 378).
The trial court cannot make a declaration of heirship in the civil action for the reason that such
a declaration can only be made in a special proceeding. Under Section 3, Rule 1 of the 1997
Revised Rules of Court, a civil action is defined as "one by which a party sues another for the
enforcement or protection of a right, or the prevention or redress of a wrong" while a special

LITAM and COMPANY, INC., GREGORIO DY TAM, WILLIAM TAM, LUIS LITAM, LI HONG
HAP and HENRY LITAM, defendants-appellants.
De
los
Santos
and
De
los
Santos
for
plaintiff-appellee.
Benjamin H. Aquino, Arturo C. Mojica and Albert C. Mendoza for defendants-appellants.
LABRADOR, J.:
Arminio Rivera brought this action in his capacity a administrator of the estate of the
deceased Rafael Litam to recover from the defendants some 54/204 shares of stock
belonging to the deceased in the Li Tam & Co., Inc., or their value, alleging that the said
shares have been fraudulently transferred by the defendants, and to render an accounting of
the income or dividends that have accrue to said shares of stock, with attorneys' fees and
costs.
The material allegations of the complaint are That (1) Rafael Litam died intestate in Manila
on January 1, 1951 and plaintiff was appointed administrator of his estate; (2) the wife of
Rafael Litam, Marcosa Rivera, filed a claim against his estate for the sum of P252,658.33
which the Court of First Instance approved; (3) believing that the properties of the deceased
were in the possession of Li Tim & Co., Inc., the administrator filed a motion in the probate
court demanding that the President and Manager, Mr Lee Chu, be required to render an
account of the income of the 54/204 shares of the deceased in said company, but said
President and Manager and Gregorio Dy Tam opposed the motion, claiming that the entire
assets or properties of the deceased were transferred on January 25, 1950 to William Litam,
Luis Litam, Henry Litam and Li Hong Hap, and to show such transfer said defendants
furnished photostat copies of the said shares of stock and the transfer thereof; (4) said
transfers are fictitious, unsupported by any adequate or valuable consideration, and
fraudulent, and defendants unlawfully and fraudulently conspired to bring about the said
transfers; said transfers had been made to enrich themselves to the prejudice of others; said
transfers were made in fraud of creditors; (5) the value of such shares is at least P300,000;
and the probate court, upon motion of administrator, has authorized him to file the suit against
the defendants.
All the defendants filed a common answer which their attorneys, Sycip, Salazar, et al.,
presented. In said answer the defendant corporation alleged that it has no knowledge or
information sufficient to form a belief as to the truth of all the allegations and denied the
same.

G.R. No. L-16954

The other defendants also denied the material allegations of the complaint and alleged that
the allegations of the complaint are conclusions of law; that the transfers of the shares of
stock to defendants are null and void. They also denied the authority of the plaintiff to file the
action; and as affirmative defenses they alleged that the shares of stock in question were
disposed of by the intestate for good, sufficient and adequate consideration without intent of
committing fraud; that the corporation in which Rafael Litam had shares of stock is no longer
existing and the present corporation, Li Tam & Company, Inc., is formed by different

April 25, 1962

ARMINIO RIVERA, in his capacity As Administrator of the Intestate Estate of the


deceased
RAFAEL
LITAM, plaintiff-appellee,
vs.

incorporations; that the defendant corporation does not have in its possession any of the
properties belonging to the intestate estate of Rafael Litam; and that the complaint states no
cause of action against the individual defendants, said defendants not having received any
sum from the deceased on January 25, 1950.

instituted for the settlement of his estate by Gregorio Dy Tam, who alleged that he and the
others namely, William, Henry, and Luis Litam and Li Hong Hap are his (of Rafael Litam)
children by a Chinese wife, with whom he had contracted marriage in China in 1911. In the
petition Gregorio Dy Tam was proposed as administrator. The wife of the deceased, Marcosa
Rivera, proposed Arminio Rivera, a nephew. This proposal was opposed by the petitioner
Gregorio Dy Tam on the ground that Marcosa Rivera had a claim against the intestate. The
lower court approved the appointment of Arminio Rivera, and the case having come to this
Court in G.R. No. L-6297, We held that the appointment was proper as the administrator
would have the duty of protecting the estate against the pretending heirs. (See Exhibit "E").

The case was set for hearing on April 2, 1956 but the trial had to be postponed because two
cases involving the same parties, G.R. No. L-7644 and L-7645, were still pending before the
Supreme Court. On March 31, 1957 attorney for the plaintiff informed the court that the said
cases had already been decided so he prayed that the case be set for hearing anew in June
1957; this was done but the case was again postponed to August 5, 1957. Various other
postponements took place until September 24, 1957 when the attorneys for the defendants
informed the court that they were withdrawing from the case but that they had not as yet
secured the conformity of their clients to their withdrawal. The court again postponed the case
to November 22, 1957 notifying the parties of the postponement. When the case was called
for hearing on November 22, 1957, all the defendants failed to show up; so the court
authorized the clerk of court to hear the evidence for plaintiff without the presence of the
defendants. The case, however, was actually heard, without the presence of defendants, only
on February 6 and 19, 1959.

During the pendency of the intestate proceedings Marcosa Rivera, incompetent, filed a claim
for a total sum of P252,658.33 against the intestate. (Exhibit "F") The claim was approved
upon the strength of a deed dated February 24, 1946 where the deceased Rafael Litam
acknowledged a new indebtedness of P197,000.00 plus interest of P62,000 for the previous
year (Exhibit "F-2"). The order was appealed to this Court in G.R. No. L-7846, but We
dismissed the appeal for the reason that in two cases (G.R. Nos. L-7644-45) We had held
that when Rafael Litam was married to Marcosa Rivera, Rafael was not married to the mother
of Gregorio Dy Tam and his four brothers and three sisters. (Exh. "H") .

On July 16, 1959 after the plaintiff had submitted his memorandum, the court rendered
judgment, the dispositive part of which reads as follows:

On November 15, 1944 Arminio Rivera, administrator of the intestate, moved the court to
require the president and manager of Li Tam & Company, Inc., to give an account of the
Income derived from the 54/204 shares of stock of the intestate (Exhibit "I"). In answer Lee
Chu alleged that at the time of his death, Rafael Litam was no longer a stockholder, having
transferred his shares to various persons (Exhibit "J"). Upon the filing of this answer the
probate court authorized the filing of this action against Henry Litam, Li Hong Hap, Luis Litam
and William Litam and others (Exhibit "K").

PREMISES CONSIDERED, this Court finds the complaint to be substantiated by the


evidence on record and judgment is hereby rendered thus:
(1) The transfer on June 25, 1950 of the certificates of stock of Rafael Litam to wit: Nos. V-2,
V-3, V-9, V-10, V-11, V-12, V-13, V-14, all of Li Tam & Co., Inc., in favor of the respective
transferees is hereby declared null and void and of no legal effect and the estate of Rafael
Litam remains the owner or the above mentioned certificates of stock;

The photostat copies of the original shares of stock (Exhibits L, L-1 to L-7) of Rafael Litam
show the following transfers of the stock: .

(2) Because of the dissolution of Li Tam & Co., Inc. in 1952, the successor defendant
corporation is hereby directed either to cause the issuance in favor of the estate of Rafael
Litam of the equivalent number of its shares of capital stock or should that be not possible for
one reason or another, to pay to said estate, jointly and severally with the other defendants,
the value of said 54/204 shares of stock which is hereby fixed at P300,000.; and

6 shares to Luis Litam


6 shares to Luis Litam
6 shares to Luis Litam
4 shares to Luis Litam 2 to William Litam
1 shares to Li Hong Hap
6 shares to William Litam
6 shares to William Litam
8 shares to William Litam
9 shares to Henry Litam (Exhs. "L, L-1, to L-7").

(3) All the defendants are ordered to pay jointly and severally the herein plaintiff the sum of
P6,000.00 as attorney' fees and expenses of litigation. (pp. 95-96, R.O.A.)
Against the above judgment the defendants have prosecuted this appeal.
Some antecedent facts constituting the background is necessary to an understanding of the
evidence on the main issue, namely, the validity of the transfer of the 54/20 shares of the
deceased Rafael Litam to the defendants William, Henry, and Luis Litam and Li Hong Hap.

In Civil Case No. 2071 of the Court of First Instance of Rizal, Gregorio Dy Tam, sought to
recover certain properties in Navotas, Rizal, Malabon, Rizal and in Obando, Bulacan, alleging
that Rafael Litam was survived by Li Hong Hap, Li Ko, Gregorio Dy Tam, Henry Litam, Beatriz
Lee Tam, Elsa Lee Tam, William Litam and Luis Litam by a marriage in China in 1911 with Sia

Rafael Litam was married to Marcosa Rivera on June 10, 1922. He died on January 10, 1950
while a resident of Hulong Duhat, Malabon, Rizal. Upon his death intestate proceedings were

Khin. The Court of First Instance dismissed the action and declared the properties to be
exclusive, separate paraphernal properties of Marcosa Rivera (Exhibit "M"). Upon appeal to
Us, in G.R. No. L-7644, We affirmed the decision with a slight modification. (Exhibit "N").

Disyembre, 1947; at LIMANG LIBONG PISO (P5,000.00) isang buwan simula sa buwan ng
Enero, 1948, hanggang sa matapusan ang nasabing halaga; .
Sa huling halagang P62,000.00 ako ay maghuhulog ng P31,000.00 sa buwan ng Disyembre,
1946, o bago dumating ang nasabing petsa, at P31,000.00 sa buwan ng Disyembre, 1947 o
bago dumating ang nasabing petsa, at ang pakinabang na 10% isang taon ay nasabing
halagang P62,000.00 ay huhulugan ko buwan-buwan por mensualidades vencidos at ang
unang hulog ay gagampanan ko sa buwan ng Marzo, 1946.1wph1.t

The evidence for plaintiff consists of the testimony of himself and various documents. The gist
of the testimony is as follows: Rafael Litam died on January 10, 1951, and his wife, on
September 12, 1957. During his lifetime, Rafael Litam was President and General Manager of
the Li Tam and Company, Inc., and had 54/204 shares therein; that upon plaintiff's
qualification as administrator he inspected the properties of the deceased in the Bicol Region
and during the inspection he met defendant Henry Litam at Casiguran, Sorsogon and Henry
told him that the properties were still intact in different places. He further testified that he met
the defendants several times in 1948 in their office at 928 San Fernando, San Nicolas, Manila
and he was told that Rafael Litam owned shares in the company valued at P300,000; that
when he went to collect the debt of Rafael Litam to his aunt, he was told not to worry as they
did not claim the shares as their own. These facts were not contradicted is defendants did not
appear in person or by attorney on the dates of the trial.

3. Kung sakaling hindi ko matupad ang alin man sa mga condiciones na nasaad sa
kasulatang ito, ang kabuoan ng aking pagkakautang ay magiging vencido at maaaring
singilin lahat ng may hawak ng kasulatang ito.
4. Bilang garantia ng aking pagkakautang na ito ay ipinangangako kong sa loob ng lalong
madaling panahon ay gagawa ako ng isang escritura de hipoteca ng lahat ng aking mga
propiedades sa Sorsogon favor sa aking asawang Marcosa Rivera.
SA KATUNAYAN NG LAHAT NG ITO, ako ay lumagda sa ibaba nito, dito sa Malabon, Rizal,
Pilipinas, ngayong ika 24 ng Febrero, 1946.

The main basis of the action are two documents, identified at the trial as Exhibits "O" and "P".
They are as follows: .

(Sgd.)
RAFAEL LITAM

KASULATAN SA PAGKAKAUTANG .

Rafael

Litam

NILAGDAAN SA HARAP NI: .

ALAMIN NG LAHAT NA MAKABABASA NITO:

MACARIO B. ASISTIO

Na akong si RAFAEL LITAM, ciudadano chino, may sapat na gulang, may asawa at
naninirahan sa Malabon, Rizal, Pilipinas, ay malaya at kusang loob na .

TAFOS
COMMONWEALTH
PROVINCIA DE RIZAL

NAGSASAYSAY NG SUMUSUNOD:
1. Na bago magsiklab ang katatapos na digmaan sa Pacifico, ako may pagkakautang sa
aking asawang si MARCOSA RIVERA ng halagang ISANG DAAN AT TATLONGPUT
LIMANG LIBONG PISO (P135,000.00), kuwaltang pilipino, na tinanggap ko ng boong
kasiyahang loob sa nasabi kong asawa, at siya kong ginamit sa aking negocio. Ang nasabing
halaga ay salaping sarili ng aking asawa, at hanggang sa sandaling ito ay hindi ko pa
nababayaran sa kanya kahi't bahagi nito.

ILLEGIBLE.
UNIDOS
DE

DE
FILIPINAS)

S.

AMERICA
S.

En el Municipio de Malabon, Provincia de Rizal, Filipinas, hoy a 25 de Febrero de 1946, A. D.


comparecio personalmente anmi el Sr. Rafael Litam, con su certificado de residencia No. A268183, expedido en Malabon, Rizal, et 25 de Febrero de 1946, de quien hoy fe que conozco
por ser la misma persona que otorgo el preinserto documento y que ratifico haberlo otorgado
libre y espontancamente, el cual se compone de dos paginas, inclusive la que contiine esta
ratificacion, la segunda de las cual-es ha sido firmada en el margen izquierdo por el
otorgante y sus testigos, y sellada con mi timbre notarial.

2. Na noong ika 4 ng Enero ng taong ito, sa hangad kong maitayong muli ang aking
negocio na nasira ng digmaan, ay napangahasan kong galawin at kunin sa kinatataguan ang
halaga pang ANIMNAPU'T DALAWANG LIBONG PISO (P62,000.00), kuwaltang pilipino, na
salapi ding sarili ng aking asawang si Marcosa Rivera, kaya't sa ngayon ako ay may
pagkakautang sa kanya ng halagang ISANG DAAN AT SIYAMNAPU'T PITONG LIBONG
PISO (P197,000.00) kuwaltang pilipino, at sa pamamagitan nito ay ipinangangako kong
babayaran sa kanya, u orden, ang nasabing halaga pati ng pakinabang na 10% isang taon
ng huling halagang P62,000.00, sa ganitong paraan: .

Anti
(Sgd.) ILLEGIBLE.
NOTARIO
Mi
el 31 de Dic., 1946 .
Asiento
No.
6;
II; Serie de 1946." (Exhibit "O") .

Sa dati kong utang na P135,000.00 ako ay maghuhulog ng halagang ISANG LIBONG PISO
(P1,000.00) isang buwan simula sa buwan ng Marzo, 1946, hanggang sa buwan ng

Exhibit "P" .

mi,
PUBLICO
expira

commission
Pag.

No.

2;

Libro

Ang kabu-uan nang kualtang natangap ko na galing sa aking asawang si Marcosa Rivera
simula nang ako ay pumasok sa Ospital ay LABING DALAWANG LIBONG PISO
(P12,600.00).
(Sgd.)
RAFAEL LITAM
Noviembre
Manila.

Rafael

Litam

28,

1950.

Our examination of the certificates of stock shows that the deceased Rafael Litam's
signatures to the indorsement were authentic, but the dates of indorsement and the names
are not; so we believe, Rafael must have signed the indorsement not on January 25, 1950
but before, and the shares actually transferred in the books already after 1952. From these
circumstances we conclude that the certificates of stock must have been delivered, already
signed by the deceased, before his death, in secret, to his alleged children, the defendants
herein, who, after Rafael Litam's death in January 1951, wrote their names on the shares as
endorsees, in secret also. Their purpose is evident so that upon Rafael's death his Filipino
wife would not be able to claim the shares of stock as part of Rafael's assets and same
(shares) would not be subject to the payment of his debts. These debts at the time of his
death in 1950 reached more than P250,000. The fact that the real properties, presumably of
the deceased, in the Bicol region were also in the name of the corporation, not in Rafael's
own, must have been part of the scheme to insure that his (the deceased) assets would pass
to his children, the defendants, free from the claims of his wife.

The court below found that the transfer of the shares of stock to defendants was simulated,
fictitious and without consideration; that it was in fraud of creditors and the conduct of the
defendants at the time the transfer of the properties of the deceased was being made,
renders the alleged sale doubtful. The peculiar circumstances, such as the fact that
defendants claimed to be children of the deceased, and claimed various real properties as
belonging to Rafael Litam when as a matter of fact they were the exclusive paraphernal
properties of his wife both of which facts were found in the decisions of the Supreme Court
reveal why the transfer of the shares was disclosed only in the year 1954, when as a
matter of fact the transfers took place purportedly at the same time on July 25, 1950.

It appears, therefore, that the deceased Rafael Litam had been getting money from his
Filipina wife (to distinguish her from the Chinese wife by whom he had his children, the
defendants bearing his name), borrowing from her big sums which he put in the company, Li
Tam and Company, Inc., in shares of stock of this corporation, later endorsing the certificates
evidencing transfer thereof, without date, and delivering the shares to his children, also
investing the funds of the company, in the purchase of real estate also in the name of the
corporation, thus depriving his wife, from whom the money came, of the legal means to get
back the money loaned. And to complete the fraudulent scheme and in order to make the
properties more invulnerable to the claims of Rafael Litam's creditors, the defendants for no
apparent reason, dissolved the old corporation and formed the new Li Tam and Company,
Inc., on October 3, 1952, the defendants, children of the deceased being the new
stockholders (see Exhibit "X"). The fact that in the new corporation the respective shares of
the incorporators do not exactly coincide with the shares each had received from Rafael
Litam, according to the endorsements of the original shares, prove that Rafael Litam's
children actually divided his assets among themselves, not according to the endorsements of
the shares.

The above findings as to the existence of fraud, the lack of consideration, etc., are disputed
by the appellants in their first assignment of error, it being contended by them that the
premises are insufficient to prove lack of a consideration, as defendants had no duty to make
public the transfer and disclose the consideration therefor, etc. Answering the above
contention, we state that defendants did not prove that they ever paid any price or
consideration for the transfer, or that they had the means to pay for the price, or that the
deceased had ever received any payment for the transfer, as it was shown that he was so
short of funds soon after the date of the supposed transfer that he had to borrow the sum of
P12,000.00 from his wife on November 28, 1950 (Exhibit "P"). When in 1949 and 1950
plaintiff Rivera saw the defendants William Litam, Luis Litam and Henry Litam, these
defendants admitted that Rafael Litam owned shares in the corporation valued at P300,000
(t.s.n., p. 23). And even after the death of Rafael Litam, in the year 1952, when plaintiff went
to the Bicol region to check up the properties left by the intestate for the purpose of preparing
the inventory thereof, he met Henry Litam in Casiguran, Sorsogon. Henry Litam then did not
say that the properties did not belong to the deceased (t.s.n., p. 32), when the supposed
endorsement of the shares bears date of July 25, 1950. In the year 1952, before plaintiff filed
the inventory, he took up with Lee Chu the matter of the interest of Rafael Litam in the
corporation, Li Tam and Company, Inc. Lee Chu, who was then president, admitted that the
deceased Rafael Litam owned 54 shares of the entire stock (t.s.n., p. 33). Our conclusion
from all the above facts and from these admissions in 1952 of Lee Chu, then president of Li
Tam and Company, Inc., and of Henry Litam, one of the defendants, is that in 1952 the
shares were still owned by Rafael Litam and had not yet been endorsed or transferred on the
books of the corporation to the defendants.

The fraudulent character of the transfer of all his shares of stock by Rafael Litam is clearly
inferable from the following circumstances: namely, the transferees are his own children; no
consideration or price was given or received for the transfer; the shares of stock were the
only properties of Rafael Litam; there was no apparent need for him to dispose of all of them
as the corporation was the only source of business that he had; and he had an outstanding
indebtedness of more than P250,000 with his wife with whom he had no issue. It has been
said that "the fertility of man's invention in devising new schemes of fraud is so great that
courts have declined to define it, reserving to themselves the liberty to deal with it under
whatever form it may present itself." In the case at bar the fraudulent scheme is evidenced by
a series of related acts committed one after another, silently, quietly and surreptitiously. Our

jurisprudence abounds with cases where fraud had been held to exist but we have found
none in which all the circumstances above indicated are present, the circumstances being
varied as the men who schemed the fraud in each case. The nearest to the case at bar
is Ayles vs. Reyes and Reyes, 18 Phil. 243, where the Supreme Court held that fraud was
proved where it was shown that the debtor went into insolvency and, conniving with his
parents, sold part of his property to them and the sales were simulated, and only for the
purpose of frustrating liabilities contracted.

testified to be P6,000, for these defendants-appellants are liable by reason of the abovequoted provisions. We, therefore, find without merit the second and last assignment of errors
of appellants and we, thereby, dismiss the same.
As their third assignment of error, it is claimed on behalf of the appellants that defendants
William Litam, Luis Litam and Li Tam and Company, Inc., did not receive notice of the hearing
on February 6, and 19, 1959; that the reason for their failure to receive said notice is because
they had already transferred their places of residence; that they failed to notify the court of the
changes of address because they did not know that is required of them; that if allowed to
present evidence, they would substantially prove the allegations in their answer.

One last point needs consideration, and this is the claim made by the defendant corporation
that its obligation to transfer the shares of stock to the estate could not be inferred from the
Articles of Incorporation (Exhibit "X"), because the two corporations are distinct and separate,
and under the authorities cited by it, even if the new succeeded the old corporation. This
claim would have been correct had not the defendant corporation expressly acquired the
assets and properties of the old Li Tam and Company, Inc., and assumed its obligations and
liabilities in the articles of incorporation. (Exh. "X", Par. "d"). The trial court, therefore,
correctly held defendant corporation liable to the estate for the equivalent number of shares
of stock, otherwise, said corporation would be enriching itself at the expense of the estate.

The arguments presented by appellants are the same as those contained in their motion for
new trial and/or reconsideration, which the lower court denied. The rule in this jurisdiction is
that a petition for new trial is addressed to the discretion of the court and this Court will not
disturb the same on appeal, unless there is grave abuse thereof (La O v. Dee, et al., L-3890,
January 23, 1952). We are only to examine the record of the case, to determine if the denial
constitutes an abuse of discretion.
There is no question that defendants Henry Litam, Gregorio Dy Tam and Li Hong Hap
actually received their copies of the order of the lower court setting the case for hearing on
February 6 and 19, 1959. Insofar as they are concerned, therefore, they cannot claim denial
of their day in court. Are the other defendants, namely, Luis and William Litam and Li Tam and
Company, Inc., guilty of excusable negligence for their failure to appear during the trial?

In view of the fraud and all the foregoing, the transfer of the shares must be declared null and
void and of no effect (Article 1409, Civil Code), and the transferees, as well as the corporation
which consented to the transfer, must all be held liable for the return of the properties, that the
shares represented, or their values (Article 1352, Civil Code).
Another objection to the judgment raised by the appellants is that they should not be required
to pay the amount of P300,000 as well as the attorney's fees. The judgment for P300,000 is
an alternative relief afforded the plaintiff in case the shares of stock can not be recovered.
Attorney's fees should be awarded because the plaintiff has been forced to various litigations
in order to enforce the payment of plaintiffs claim.

The record discloses that as early as August 5, 1957, defendants' counsel, the law office
Sycip, et al., was already withdrawing from the case and this withdrawal was reiterated in
another motion for continuance of the hearing scheduled for September 24, 1957. As early as
August 5, 1957, therefore, defendants must have known that they would be without counsel.
They should have, therefore, taken steps to secure the services of another. Again on
November 21, 1957, defendant Luis Litam agreed to the withdrawal of their counsel, and Luis
Litam signed the conformity to said withdrawal in his own behalf and in those of the other
defendants. There is nothing in the record, especially in the affidavit of Luis Litam supporting
defendants' motion for new trial, that the other defendants did not authorized him to sign for
them. Having no lawyer to assist them in the proceedings, and knowing that the case was
then ready for hearing, defendants should have taken the necessary precaution of hiring a
new lawyer for any subsequent hearing or hearings. Those who had changed their addresses
should also have informed the court thereof. They failed to do so, and it was only when they
received a copy of the decision that they hired their present counsel. Their neglect in doing so
is certainly inexcusable.

Art. 1388. Whoever acquires in bad faith the things alienated in fraud of creditors, shall
indemnify the latter for damages suffered by them on account of the alienation, whenever,
due to any cause, it should be impossible for him to return them." (Civil Code of the
Philippines).
Art. 1170. Those who in the performance of their obligations are guilty of fraud, negligence
or delay, and those who in any manner contravene the tenor thereof, are liable for damages.
Liability for Non-Performance. In general, every debtor who fails in the performance of his
obligations is bound to indemnify for the losses and damages caused thereby. (De la Cruz vs.
Seminary of Manila, 18 Phil. 330; Municipality of Moncada v. Cajuigan, 21 Phil. 184; De la
Cavada vs. Diaz, 37 Phil. 982; Maluenda v. Enriquez, 46 Phil. 916; Pampanga Sugar Mills v.
Chong, 49 Phil. 1003; Pando v. Gimenez; 54 Phil. 459; Acme Films v. Theaters Supply, 63
Phil. 657). Tolentino's The New Civil Code Annotated, p. 314).

The defendants admit their places of residence alleged in the complaint in their answer. As no
notices of the changes of address was sent by them to the court, naturally notices of hearing
and orders of the court had to be sent to their former addresses. With respect to defendant
corporation, it is alleged in the affidavit of Luis Litam that it had transferred its office to

Therefore the damages sustained by the plaintiff by reason of the fraudulent transfer of the
shares of stock are the value thereof and the expenses of litigation, which plaintiff has

Sorsogon as early as 1953, but in their answer dated October 10, 1955, they admit that the
office of the defendant corporation is at 928 San Fernando, San Nicolas, Manila, the same
place where the notice of hearing was sent. This admission strengthens the impression that
defendants had deliberately refused to accept the notices of hearing.

LEONEN, J.:

The record also discloses that the order setting the case for hearing was sent to defendants
Luis and William Litam and Li Tam and Company, Inc., who failed to get said order inspite of
the two notices sent to them. Inasmuch as defendants failed to get their registered letters
service upon them of said order was deemed completed, five days from the date of the first
notice, in accordance with the provisions of Sec. 8, Rule 27 of the Rules. Consequently,
defendants can not now claim that they have not been given their day in court.

This is a petition for review on certiorari assailing the decision 2 and resolution3 of the Court of
Appeals in CA-G.R. SP. No. 86818, which upheld the (1) order 4 dated November 22, 2002
dismissing Civil Case No. 02-103319 without prejudice, and (2) the omnibus order 5 dated July
30, 2004, which denied petitioners motion for reconsideration. Both orders were issued by
the Regional Trial Court of Manila, Branch 6.6

Rule 17 of the Rules of Civil Procedure governs dismissals of actions at the instance of the
plaintiff. Hence, the "two-dismissal rule" under Rule 17, Section 1 of the Rules of Civil
Procedure will not apply if the prior dismissal was done at the instance of the defendant.

The issues before this court are procedural. However, the factual antecedents in this case,
which stemmed from a complicated family feud, must be stated to give context to its
procedural development.

Furthermore, the petition for new trial could not be granted because there is no showing that
defendants have valid defenses to the complaint. The affidavit of Luis Litam supporting
defendants' motion for reconsideration and new trial do not show any such valid defense.
Consequently, the trial court correctly denied defendants' motion for new trial and/or
reconsideration.

It is alleged that Antonio Ching owned several businesses and properties, among which was
Po Wing Properties, Incorporated (Po Wing Properties). 7 His total assets are alleged to have
been worth more than 380 million. 8 It is also alleged that whilehe was unmarried, he had
children from two women.9

FOR ALL THE FOREGOING CONSIDERATIONS the judgment appealed from should be, as
it hereby is, affirmed. With costs. So ordered.

Ramon Ching alleged that he was the only child of Antonio Ching with his common-law wife,
Lucina Santos.10 She, however, disputed this. She maintains that even ifRamon Chings birth
certificate indicates that he was Antonio Chings illegitimate child, she and Antonio Ching
merely adopted him and treated him like their own. 11

Bengzon, C.J., Bautista Angelo, Concepcion, Reyes, J.B.L., Paredes and Dizon, JJ., concur.

Joseph Cheng and Jaime Cheng, on the other hand, claim to be Antonio Chings illegitimate
children with his housemaid, Mercedes Igne. 12 While Ramon Ching disputed this, 13 both
Mercedes and Lucina have not.14
Lucina Santos alleged that when Antonio Ching fell ill sometime in 1996, he entrusted her
with the distribution of his estate to his heirs if something were to happen to him. She alleged
that she handed all the property titles and business documents to Ramon Ching for
safekeeping.15 Fortunately, Antonio Ching recovered from illness and allegedly demanded
that Ramon Ching return all the titles to the properties and business documents. 16

G.R. No. 175507


RAMON
CHING
vs.
JOSEPH
CHENG,
SANTOS, Respondents.

On July 18, 1996, Antonio Ching was murdered. 17 Ramon Ching allegedly induced Mercedes
Igne and her children, Joseph Cheng and Jaime Cheng, to sign an agreement and waiver 18 to
Antonio Chings estate in consideration of P22.5 million. Mercedes Ignes children alleged
that Ramon Ching never paid them. 19 On October 29, 1996, Ramon Ching allegedly executed
an affidavit of settlement of estate,20 naming himself as the sole heir and adjudicating upon
himself the entirety of Antonio Chings estate.21

October 8, 2014
AND
JAIME

POWING
CHENG,

PROPERTIES,
MERCEDES

INC., Petitioners,

IGNE 1 AND

Ramon Ching denied these allegationsand insisted that when Antonio Ching died, the Ching
family association, headed by Vicente Cheng, unduly influenced him to give Mercedes Igne
and her children financial aid considering that they served Antonio Ching for years. It was for
this reason that an agreement and waiver in consideration of 22.5 million was made. He also

LUCINA

DECISION

alleged that hewas summoned by the family association to execute an affidavit of settlement
of estate declaring him to be Antonio Chings sole heir.22

Extra judicial Agreement, Deed of Absolute Sale, and Transfer Certificates of Title with Prayer
for TRO and Writ of Preliminary Injunction" against Ramon Ching and Po Wing Properties.
This case was docketed as Civil Case No. 02-105251(the third case) and was eventually
raffled to Branch 6.38

After a year of investigating Antonio Chings death, the police found Ramon Ching to be its
primary suspect.23Information24 was filed against him, and a warrant of arrest25 was issued.

On December 10, 2002, Ramon Ching and Po Wing Properties filed their
comment/opposition to the application for temporary restraining order in the third case. They
also filed a motion to dismiss on the ground of res judicata, litis pendencia, forum-shopping,
and failure of the complaint to state a cause of action. A series of responsive pleadings were
filed by both parties.39

On October 7, 1998, Joseph Cheng, Jaime Cheng, and Mercedes Igne (the Chengs) filed a
complaint for declaration of nullity of titles against Ramon Ching before the Regional Trial
Court of Manila. This case was docketed as Civil Case No. 98-91046 (the first case). 26
On March 22, 1999, the complaint was amended, with leave of court, to implead additional
defendants, including Po Wing Properties, of which Ramon Ching was a primary
stockholder.The amended complaint was for "Annulment of Agreement, Waiver, Extra-Judicial
Settlement of Estate and the Certificates of Title Issued by Virtue of Said Documents with
Prayer for Temporary Restraining Order and Writ of Preliminary Injunction." 27 Sometime after,
Lucina Santos filed a motion for intervention and was allowed to intervene. 28

On July 30, 2004, Branch 6 issued an omnibus order 40 resolving both the motion for
reconsideration in the second case and the motion to dismiss in the third case. The trial court
denied the motion for reconsideration and the motion to dismiss, holding that the dismissal of
the second case was without prejudice and, hence, would not bar the filing of the third
case.41 On October 8, 2004, while their motion for reconsideration in the third case was
pending, Ramon Ching and Po Wing Properties filed a petition for certiorari (the first certiorari
case) with the Court of Appeals, assailing the order dated November 22,2002 and the portion
of the omnibus order dated July 30, 2004, which upheldthe dismissal of the second case. 42

After the responsive pleadings had been filed, Po Wing Properties filed a motion to dismiss
on the ground of lack of jurisdiction of the subject matter.29
On November 13, 2001, the Regional Trial Court of Manila, Branch 6, granted the motion to
dismiss on the ground of lack of jurisdiction over the subject matter. 30 Upon motion of the
Chengs counsel, however, the Chengs and Lucina Santos were given fifteen (15) days to file
the appropriate pleading. They did not do so.31

On December 28, 2004, the trial court issued an order denying the motion for reconsideration
in the third case. The denial prompted Ramon Ching and Po Wing Properties to file a petition
for certiorari and prohibition with application for a writ of preliminary injunction or the issuance
of a temporary restraining order (the second certiorari case) with the Court of Appeals. 43

On April 19, 2002, the Chengs and Lucina Santos filed a complaint for "Annulment of
Agreement, Waiver, Extra-Judicial Settlement of Estate and the Certificates of Title Issued by
Virtue of Said Documents with Prayer for Temporary Restraining Order and Writ of
Preliminary Injunction" against Ramon Ching and Po Wing Properties. 32This case was
docketed as Civil Case No. 02-103319 (the second case) and raffled to Branch 20 of the
Regional Trial Court of Manila.33 When Branch 20 was made aware of the first case, it issued
an order transferring the case to Branch 6, considering that the case before it involved
substantially the same parties and causes of action. 34

On March 23, 2006, the Court of Appeals rendered the decision 44 in the first certiorari case
dismissing the petition. The appellate court ruled that Ramon Ching and Po Wing Properties
reliance on the "two-dismissal rule" was misplaced since the rule involves two motions for
dismissals filed by the plaintiff only. In this case, it found that the dismissal of the first case
was upon the motion of the defendants, while the dismissal of the second case was at the
instance of the plaintiffs.45

On November 11, 2002, the Chengs and Lucina Santos filed a motion to dismiss their
complaint in the second case, praying that it be dismissed without prejudice. 35

Upon the denial of their motion for reconsideration, 46 Ramon Ching and Po Wing Properties
filed this present petition for review47 under Rule 45 of the Rules of Civil Procedure.

On November 22, 2002, Branch 6 issued an order granting the motion to dismiss on the basis
that the summons had not yet been served on Ramon Ching and Po Wing Properties, and
they had not yet filed any responsive pleading. The dismissal of the second case was made
without prejudice.36

Ramon Ching and Po Wing Properties argue that the dismissal of the second case was with
prejudice since the non-filing of an amended complaint in the first case operated as a
dismissal on the merits.48 They also argue that the second case should be dismissed on the
ground of res judicata since there was a previous final judgment of the first case involving the
same parties, subject matter, and cause of action. 49

On December 9, 2002, Ramon Ching and Po Wing Properties filed a motion for
reconsideration of the order dated November 22, 2002. They argue that the dismissal should
have been with prejudice under the "two dismissal rule" of Rule 17, Section 1 of the 1997
Rules of Civil Procedure, in view of the previous dismissal of the first case. 37

Lucina Santos was able to file a comment 50 on the petition within the period required.51 The
Chengs, however, did not comply.52 Upon the issuance by this court of a show cause order on
September 24, 2007,53 they eventually filed a comment with substantially the same
allegations and arguments as that of Lucina Santos.54

During the pendency of the motion for reconsideration, the Chengs and Lucina Santos filed a
complaint for "Disinheritance and Declaration of Nullity of Agreement and Waiver, Affidavit of

In their comment, respondents allege that when the trial court granted the motion to dismiss,
Ramon Chings counsel was notified in open court that the dismissal was without prejudice.
They argue that the trial courts order became final and executory whenhe failed to file his
motion for reconsideration within the reglementary period. 55

(15) days from notice of the motion he manifests his preference to have his counterclaim
resolved in the same action. Unless otherwise specified in the order, a dismissal under this
paragraph shall be without prejudice. A class suit shall not be dismissed or compromised
without the approval of the court.

Respondents argue that the petition for review should be dismissed on the ground of forum
shopping and litis pendencia since Ramon Ching and Po Wing Properties are seeking relief
simultaneously in two forums by filing the two petitions for certiorari, which involved the same
omnibus order by the trial court. 56 They also argue that the "two-dismissal rule" and res
judicata did not apply since (1) the failure to amend a complaint is not a dismissal, and (2)
they only moved for dismissal once in the second case. 57

SEC. 3. Dismissal due to fault of plaintiff. If, for no justifiable cause, the plaintiff fails to
appear on the date of the presentation of his evidence in chief on the complaint, or to
prosecute his action for an unreasonable length of time, or to comply with these Rules or any
order of the court, the complaint may be dismissed upon motion of the defendant or upon the
court's own motion, without prejudice to the right of the defendant to prosecute his
counterclaim in the same or in a separate action. This dismissal shall have the effect of an
adjudication upon the merits, unless otherwise declared by the court. (Emphasis supplied)

In their reply,58 petitioners argue that they did not commit forum shopping since the actions
they commenced against respondents stemmed from the complaints filed against them in the
trial courts.59 They reiterate that their petition for review is only about the second case; it just
so happened that the assailed omnibus order resolved both the second and third cases. 60

The first section of the rule contemplates a situation where a plaintiff requests the dismissal of
the case beforeany responsive pleadings have been filed by the defendant. It is donethrough
notice by the plaintiff and confirmation by the court. The dismissal is without prejudice unless
otherwise declared by the court.

Upon the filing of the parties respective memoranda,61 the case was submitted for decision.62

The second section of the rule contemplates a situation where a counterclaim has been
pleaded by the defendant before the service on him or her of the plaintiffs motion to dismiss.
It requires leave of court, and the dismissal is generally without prejudice unless otherwise
declared by the court.

For this courts resolution are the following issues:


I. Whether the trial courts dismissal of the second case operated as a bar to the filing of a
third case, asper the "two-dismissal rule"; and
II. Whether respondents committed forum shopping when they filed the third case while the
motion for reconsideration of the second case was still pending.

The third section contemplates dismissals due to the fault of the plaintiff such as the failure to
prosecute. The case is dismissed either upon motion of the defendant or by the court motu
propio. Generally, the dismissal is with prejudice unless otherwise declared by the court.

The petition is denied.


The "two-dismissal rule" vis--vis

In all instances, Rule 17 governs dismissals at the instance of the plaintiff, not of the
defendant. Dismissals upon the instance of the defendant are generally governed by Rule 16,
which covers motions to dismiss.63

the Rules of Civil Procedure


Dismissals of actions are governed by Rule 17 of the 1997 Rules of Civil Procedure. The
pertinent provisions state:
RULE
DISMISSAL OF ACTIONS

In Insular Veneer, Inc. v. Hon. Plan, 64 Consolidated Logging and Lumber Mills filed a
complaint against Insular Veneer to recover some logs the former had delivered to the latter.
It also filed ex partea motion for issuance of a restraining order. The complaint and motion
were filed in a trial court in Isabela.65

17

SEC. 1. Dismissal upon notice by plaintiff. A complaint may be dismissed by the plaintiff by
filing a notice of dismissal at any time before service of the answer or of a motion for
summary judgment. Upon such notice being filed, the court shall issue an order confirming
the dismissal. Unless otherwise stated in the notice, the dismissal is without prejudice, except
that a notice operates as an adjudication upon the merits when filed by a plaintiff who has
once dismissed in a competent court an action based on or including the same claim.

The trial court granted the motion and treated the restraining order as a writ of preliminary
injunction. When Consolidated Logging recovered the logs, it filed a notice of dismissal under
Rule 17, Section 1 of the 1964 Rules of Civil Procedure. 66
While the action on its notice for dismissal was pending, Consolidated Logging filed the same
complaint against Insular Veneer, this time in a trial court in Manila. It did not mention any
previous action pending in the Isabela court.67

SEC. 2. Dismissal upon motion of plaintiff. Except as provided in the preceding section, a
complaint shall not be dismissed at the plaintiff's instance save upon approval of the court
and upon such terms and conditions as the court deems proper. If a counterclaim has been
pleaded by a defendant prior to the service upon him of the plaintiffs motion for dismissal, the
dismissal shall be limited to the complaint. The dismissal shall be without prejudice to the
right of the defendant to prosecute his counterclaim in a separate action unless within fifteen

The Manila court eventually dismissed the complaint due to the nonappearance of
Consolidated Loggings counsel during pre-trial. Consolidated Logging subsequently returned
to the Isabela court to revive the same complaint. The Isabela court apparently treated the
filing of the amended complaint as a withdrawal of its notice of dismissal. 68

10

The purpose of the "two-dismissal rule" is "to avoid vexatious litigation." 73 When a complaint
is dismissed a second time, the plaintiff is now barred from seeking relief on the same claim.

Insular Veneer also filed in the Isabela court a motion to dismiss, arguing that the dismissal
by the Manila court constituted res judicataover the case. The Isabela court, presided over by
Judge Plan, denied the motion to dismiss. The dismissal was the subject of the petition for
certiorari and mandamus with this court.69

The dismissal of the second case was without prejudice in view of the "two-dismissal rule"
Here, the first case was filed as an ordinary civil action. It was later amended to include not
only new defendants but new causes of action that should have been adjudicated in a special
proceeding. A motion to dismiss was inevitably filed by the defendants onthe ground of lack of
jurisdiction.

This court stated that:


In resolving that issue, we are confronted with the unarguable fact that Consolidated Logging
on its volition dismissed its action for damages and injunction in the Isabela court and refiled
substantially the same action in the Manila court. Then, when the Manila court dismissed its
action for failure to prosecute, it went hack [sic] to the Isabela court and revived its old action
by means of an amended complaint.

The trial court granted that motion to dismiss, stating that:


A careful perusal of the allegations of the Amended Complaint dated February 10, 1999, filed
by Plaintiff Joseph Cheng, show that additional causes of action were incorporated i.e. extrajudicial settlement of the intestate estate of Antonio Ching and receivership, subject matters,
which should be threshed out in a special proceedings case. This is a clear departure from
the main cause of action in the original complaint which is for declaration of nullity of
certificate of titles with damages. And the rules of procedure which govern special
proceedings case are different and distinct from the rules of procedure applicable in an
ordinary civil action.

Consolidated Logging would liketo forget the Manila case, consign it to oblivion as if it were a
bad dream, and prosecute its amended complaint in the Isabela court as if nothing had
transpired in the Manila court. We hold that it cannot elude the effects of its conduct in junking
the Isabela case and in giving that case a reincarnation in the Manila court.
Consolidated Logging [sic] filed a new case in Manila at its own risk. Its lawyer at his peril
failed toappear at the pre-trial.70
This court ruled that the filing of the amended complaint in the Isabela court was barred by
the prior dismissal of the Manila court, stating that:

In view of the afore-going, the court finds the Motion to Dismiss filed by Atty. Maria Lina Nieva
S. Casals to be meritorious and the Court is left with no alternative but to dismiss as it hereby
dismisses the Amended Complaint.

The provision in section 1(e), Rule 16 of the Rules of Court that an action may be dismissed
because "there is another action pending between the same parties for the same cause"
presupposes that two similar actions are simultaneously pending in two different Courts of
First Instance. Lis pendensas a ground for a motion to dismiss has the same requisites as the
plea of res judicata.

However, on motion of Atty. Mirardo Arroyo Obias, counsel for the plaintiffs, he is given a
period of fifteen (15) days from today, within which to file an appropriate pleading, copy
furnished to all the parties concerned.
....

On the other hand, when a pleading is amended, the original pleading is deemed abandoned.
The original ceases to perform any further function as a pleading. The case stands for trial on
the amended pleading only. So, when Consolidated Logging filed its amended complaint
dated March 16, 1970 in Civil Case No. 2158, the prior dismissal order dated January 5, 1970
in the Manila case could he [sic] interposed in the Isabela court to support the defense of res
judicata.71

SO ORDERED.74
Petitioners are of the view that when Atty. Mirardo Arroyo Obias failed to file the appropriate
pleading within fifteen (15) days, he violated the order of the court. This, they argue, made
the original dismissal an adjudication upon the merits, in accordance with Rule 17, Section 3,
i.e., a dismissal through the default of the plaintiff. Hence, they argue that when respondents
filed the second case and then caused its dismissal, the dismissal should have been with
prejudice according to Rule 17, Section 1, i.e., two dismissals caused by the plaintiff on the
same claim. Unfortunately, petitioners theory is erroneous.

As a general rule, dismissals under Section 1 of Rule 17 are without prejudice except when it
is the second time that the plaintiff caused its dismissal. Accordingly, for a dismissal to
operate as an adjudication upon the merits, i.e, with prejudice to the re-filing of the same
claim, the following requisites must be present:

The trial court dismissed the first case by granting the motion to dismiss filed by the
defendants. When it allowed Atty. Mirardo Arroyo Obias a period of fifteen (15) days tofile an
appropriate pleading, it was merely acquiescing to a request made bythe plaintiffs counsel
that had no bearing on the dismissal of the case.

(1) There was a previous case that was dismissed by a competent court;
(2) Both cases were based on or include the same claim;
(3) Both notices for dismissal werefiled by the plaintiff; and

Under Rule 17, Section 3, a defendant may move to dismiss the case if the plaintiff defaults; it
does not contemplate a situation where the dismissal was due to lack of jurisdiction. Since
there was already a dismissal prior to plaintiffs default, the trial courts instruction to file the
appropriate pleading will not reverse the dismissal. If the plaintiff fails to file the appropriate

(4) When the motion to dismiss filed by the plaintiff was consented to by the defendant on the
ground that the latter paid and satisfied all the claims of the former.72

11

pleading, the trial court does not dismiss the case anew; the order dismissing the case still
stands.

When respondents filed the third case on substantially the same claim, there was already one
prior dismissal at the instance of the plaintiffs and one prior dismissal at the instance of the
defendants. While it is true that there were two previous dismissals on the same claim, it does
not necessarily follow that the re-filing of the claim was barred by Rule 17, Section 1 of the
Rules of Civil Procedure. The circumstances surrounding each dismissal must first be
examined to determine before the rule may apply, as in this case.

The dismissal of the first case was done at the instance of the defendant under Rule 16,
Section 1(b) of the Rules of Civil Procedure, which states:
SECTION 1. Grounds. Within the time for but before filing the answer to the complaint or
pleading asserting a claim, a motion to dismiss may be made on any of the following grounds:

Even assuming for the sake of argument that the failure of Atty. Mirardo Arroyo Obias to file
the appropriate pleading in the first case came under the purview of Rule 17, Section 3 of the
Rules of Civil Procedure, the dismissal in the second case is still considered as one without
prejudice. In Gomez v. Alcantara:79

....
(b) That the court has no jurisdiction over the subject matter of the claim;
....
Under Section 5 of the same rule,75 a party may re-file the same action or claim subject to
certain exceptions.

The dismissal of a case for failure to prosecute has the effect of adjudication on the merits,
and is necessarily understood to be with prejudice to the filing of another action, unless
otherwise provided in the order of dismissal. Stated differently, the general rule is that
dismissal of a case for failure to prosecute is to be regarded as an adjudication on the merits
and with prejudice to the filing of another action, and the only exception is when the order of
dismissal expressly contains a qualification that the dismissal is without
prejudice.80 (Emphasis supplied)

Thus, when respondents filed the second case, they were merely refiling the same claim that
had been previously dismissed on the basis of lack of jurisdiction. When they moved to
dismiss the second case, the motion to dismiss can be considered as the first dismissal at the
plaintiffs instance.
Petitioners do not deny that the second dismissal was requested by respondents before the
service of any responsive pleadings. Accordingly, the dismissal at this instance is a matter of
right that is not subject to the trial courts discretion. In O.B. Jovenir Construction and
Development Corporation v. Macamir Realty and Development Corporation: 76

In granting the dismissal of the second case, the trial court specifically orders the dismissal to
be without prejudice. It is only when the trial courts order either is silent on the matter, or
states otherwise, that the dismissal will be considered an adjudication on the merits.

[T]he trial court has no discretion or option to deny the motion, since dismissal by the plaintiff
under Section 1, Rule 17 is guaranteed as a matter of right to the plaintiffs. Even if the motion
cites the most ridiculous of grounds for dismissal, the trial court has no choice but to consider
the complaint as dismissed, since the plaintiff may opt for such dismissal as a matter of right,
regardless of ground.77 (Emphasis supplied)

However, while the dismissal of the second case was without prejudice, respondents act of
filing the third case while petitioners motion for reconsideration was still pending constituted
forum shopping.
The rule against forum shopping and the "twin-dismissal rule"
In Yap v. Chua:81

For this reason, the trial court issued its order dated November 22, 2002 dismissing the case,
without prejudice. The order states:

Forum shopping is the institution of two or more actions or proceedings involving the same
parties for the same cause of action, either simultaneously or successively, on the
supposition that one or the other court would make a favorable disposition. Forum shopping
may be resorted to by any party against whom an adverse judgment or order has been
issued in one forum, in an attempt to seek a favorable opinion in another, other than by
appeal or a special civil action for certiorari. Forum shopping trifles with the courts, abuses
their processes, degrades the administration of justice and congest court dockets. What
iscritical is the vexation brought upon the courts and the litigants by a party who asks different
courts to rule on the same or related causes and grant the same or substantially the same
reliefs and in the process creates the possibility of conflicting decisions being renderedby the
different fora upon the same issues. Willful and deliberate violation of the rule against forum
shopping is a ground for summary dismissal of the case; it may also constitute direct
contempt.

When this Motion was called for hearing, all the plaintiffs namely, Joseph Cheng, Jaime
Cheng, Mercedes Igne and Lucina Santos appeared without their counsels. That they
verbally affirmed the execution of the Motion to Dismiss, as shown by their signatures over
their respective names reflected thereat. Similarly, none of the defendants appeared, except
the counsel for defendant, Ramon Chang [sic], who manifested that they have not yet filed
their Answer as there was a defect in the address of Ramon Cheng [sic] and the latter has not
yet been served with summons.
Under the circumstances, and further considering that the defendants herein have not yet
filed their Answers nor any pleading, the plaintiffs has [sic] the right to out rightly [sic] cause
the dismissal of the Complaint pursuant to Section 2, Rule 17 of the 1997 Rules of Civil
Procedure without prejudice. Thereby, and as prayed for, this case is hereby ordered
DISMISSED without prejudice.
SO ORDERED.78 (Emphasis supplied)

12

To determine whether a party violated the rule against forum shopping, the most important
factor toask is whether the elements of litis pendentiaare present, or whether a final judgment
in one case will amount to res judicatain another; otherwise stated, the test for determining
forum shopping is whether in the two (or more) cases pending, there is identity of parties,
rights or causes of action, and reliefs sought.82 (Emphasis supplied)

Hence, when respondents filed the third case, they engaged in forum shopping. Any
judgment by this court on the propriety of the dismissal of the second case will inevitably
affect the disposition of the third case.
This, in fact, is the reason why there were two different petitions for certiorari before the
appellate court. The omnibus order dated July 30, 2004 denied two pending motions by
petitioners: (1) the motion for reconsideration in the second case and (2) the motion to
dismiss in the third case. Since petitioners are barred from filing a second motion for
reconsideration of the second case, the first certiorari case was filed before the appellate
court and is now the subject of this review. The denial of petitioners motion for
reconsideration in the third case, however, could still be the subject of a separate petition for
certiorari. That petition would be based now on the third case, and not on the second case.

When respondents filed the third case, petitioners motion for reconsideration of the dismissal
of the second case was still pending. Clearly, the order of dismissal was not yet final since it
could still be overturned upon reconsideration, or even on appeal to a higher court.
Moreover, petitioners were not prohibited from filing the motion for reconsideration. This court
has already stated in Narciso v. Garcia83 that a defendant has the right to file a motion for
reconsideration of a trial courts order denying the motion to dismiss since "[n]o rule prohibits
the filing of such a motion for reconsideration." 84 The second case, therefore, was still
pending when the third case was filed.

This multiplicity of suits is the veryevil sought to be avoided by the rule on forum shopping. In
Dy v. Mandy Commodities Co., Inc.,86 the rule is that:

The prudent thing that respondents could have done was to wait until the final disposition of
the second case before filing the third case. As it stands, the dismissal of the second case
was without prejudice to the re-filing of the same claim, in accordance with the Rules of Civil
Procedure. In their haste to file the third case, however, they unfortunately transgressed
certain procedural safeguards, among which are the rules on litis pendentiaand res judicata.

Once there is a finding of forum shopping, the penalty is summary dismissal not only of the
petition pending before this Court, but also of the other case that is pending in a lower court.
This is so because twin dismissal is a punitive measure to those who trifle with the orderly
administration of justice.87 (Emphasis supplied)
The rule originated from the 1986 case of Buan v. Lopez, Jr. 88 In Buan, petitioners filed a
petition for prohibition with this court while another petition for prohibition with preliminary
injunction was pending before the Regional Trial Court of Manila involving the same parties
and based on the same set of facts. This court, in dismissing both actions, stated:

In Yap:
Litis pendentiaas a ground for the dismissal of a civil action refers to that situation wherein
another action is pending between the same parties for the same cause of action, such that
the second action becomes unnecessary and vexatious. The underlying principle of litis
pendentia is the theory that a party is not allowed to vex another more than once regarding
the same subject matter and for the same cause of action. This theory is founded on the
public policy that the same subject matter should not be the subject of controversy incourts
more than once, in order that possible conflicting judgments may be avoided for the sake of
the stability of the rights and status of persons.

Indeed, the petitioners in both actions . . . have incurred not only the sanction of dismissal
oftheir case before this Court in accordance with Rule 16 of the Rules of Court, but also the
punitive measure of dismissal of both their actions, that in this Court and that in the Regional
Trial Court as well. Quite recently, upon substantially identical factual premises, the Court en
banchad occasion to condemn and penalize the act of litigants of filing the same suit in
different courts, aptly described as "forum shopping[.]" 89

The requisites of litis pendentiaare: (a) the identity of parties, or at least such as representing
the same interests in both actions; (b) the identity of rights asserted and relief prayed for, the
relief being founded on the same facts; and (c) the identity of the two cases such that
judgment in one, regardless ofwhich party is successful, would amount to res judicatain the
other.85 (Emphasis supplied)

The rule essentially penalizes the forum shopper by dismissing all pending actions on the
same claim filed in any court. Accordingly, the grant of this petition would inevitably result in
the summary dismissal of the third case. Any action, therefore, which originates from the third
case pending with any court would be barred by res judicata.
Because of the severity of the penalty of the rule, an examination must first be made on the
purpose of the rule.1wphi1Parties resort to forum shopping when they file several actions of
the same claim in different forums in the hope of obtaining a favorable result. It is prohibited
by the courts as it "trifle[s] with the orderly administration of justice." 90

There is no question that there was an identity of parties, rights, and reliefs in the second and
third cases. While it may be true that the trial court already dismissed the second case when
the third case was filed, it failed to take into account that a motion for reconsideration was
filed in the second case and, thus, was still pending. Considering that the dismissal of the
second case was the subject of the first certiorari case and this present petition for review, it
can be reasonably concluded that the second case, to this day, remains pending.

In this case, however, the dismissal of the first case became final and executory upon the
failure of respondentscounsel to file the appropriate pleading. They filed the correct pleading
the second time around but eventually sought its dismissal as they"[suspected] that their
counsel is not amply protecting their interests as the case is not moving for almost three (3)

13

years."91 The filing of the third case, therefore, was not precisely for the purpose of obtaining
a favorable result butonly to get the case moving, in an attempt to protect their rights.

The subject of the present petition for certiorari 1 is Lot No. 2042, a parcel of land located in
Calapan, Oriental Mindoro and covered by Original Certificate of Title (OCT) No. 529,
registered in the name of Feliciano Alveyra (Alveyra).

It appears that the resolution on the merits of the original controversy between the parties has
long beenmired in numerous procedural entanglements. While it might be more judicially
expedient to apply the "twin-dismissal rule" and disallow the proceedings in the third case to
continue, it would not serve the ends of substantial justice. Courts of justice must always
endeavor to resolve cases on their merits, rather than summarily dismiss these on
technicalities: [C]ases should be determined on the merits, after all parties have been given
full opportunity to ventilate their causes and defenses, rather than on technicalities or
procedural imperfections. In that way, the ends of justice would be served better. Rules of
procedure are mere tools designed to expedite the decision or resolution of cases and other
matters pending in court. A strict and rigid application of rules, resulting in technicalities that
tend to frustrate rather than promote substantial justice, must be avoided.In fact, Section 6 of
Rule 1 states that the Rules [on Civil Procedure] shall be liberally construed in order to
promote their objective of ensuring the just, speedy and inexpensive disposition of every
action and proceeding.92 (Emphasis supplied)

In 1952, the Municipality of Calapan (now a City) acquired a one-half interest over Lot No.
2042 in satisfaction of a judgment award in its favor against Alveyra. Upon registration,
however, the entire Lot No. 2042 was included in Transfer Certificate of Title (TCT) No.
21306; OCT No. 529 was accordingly cancelled.
To determine the extent of Alveyra and the Municipality of Calapans interest over Lot No.
2042, an action to quiet title 2 was instituted, which case eventually reached the Court of
Appeals (CA).3 The CA, in a decision dated October 28, 1974, subdivided Lot No. 2042 into
two lots: one-half or Lot No. 2042-A (referring to the northern portion) was declared as the
property of the heirs of Alveyra who had since died, while the other half, Lot No. 2042-B
(referring to the southern portion), was declared owned by the Municipality of Calapan.
We affirmed the CAs decision on February 23, 1976 in G.R. No. 40820. The petitioners title
over Lot No. 2042-A was registered as TCT No. T-46154 and that of the Municipality of
Calapan as TCT No. T-46155.

The rule on forum shopping will not strictly apply when it can be shown that (1) the original
case has been dismissed upon request of the plaintiff for valid procedural reasons; (2) the
only pending matter is a motion for reconsideration; and (3) there are valid procedural
reasons that serve the goal of substantial justice for the fresh new case to proceed.

Meanwhile, while the heirs of Alveyra and the Municipality of Calapan were litigating their
conflicting rights over Lot No. 2042, the heirs sold their one-half interest over the land (Lot
No. 2042-A) to respondent spouses Hicoblino and Lourdes Catly (respondent Catlys).
Respondent Catlys then filed a petition for judicial approval of the subdivision plan of Lot No.
2042-A.4 On July 31, 1996, the trial court approved the petition and ordered the subdivision of
Lot No. 2042-A to into four lots and the registration of four new titles under the name of the
respondents.5

The motion for reconsideration filed in the second case has since been dismissed and is now
the subject of a petition for certiorari. The third case filed apparently contains the better cause
of action for the plaintiffs and is now being prosecuted by a counsel they are more
comfortable with. Substantial justice will be better served if respondents do not fall victim to
the labyrinth in the procedures that their travails led them. It is for this reason that we deny
the petition. WHEREFORE, the petition is DENIED. The Regional Trial Court of Manila,
Branch 6 is ordered to proceed with Civil Case No. 02-105251 with due and deliberate
dispatch.
G.R. No. 157449

In 1999, respondent Catlys alleged that a portion of their Lot No. 2042-A was being occupied
by the petitioners and sought to recover possession of the lot, initially, by instituting an
ejectment
case
against
the
petitioners. 6When
the
ejectment
case
was
7
dismissed, respondent Catlys then filed a complaint for recovery of possession 8against the
petitioners; the case is still pending decision before the Regional Trial Court (RTC) of
Calapan City, Branch 39.

April 6, 2010

NEMESIO GOCO, LYDIA G. FABIAN, NATALIA BROTONEL, FLORA GAYOSO, BLEMIE


SORIANO, ELPIDIA NAVALES, SERGIO ROMASANTA, CATALINA NAMIS and NANCY
PAMATIGA, represented by their Attorneys-in-Fact, LYDIA G. FABIAN, ELPIDIA
NAVALES
and
NATALIA
BROTONEL, Petitioners,
vs.
HONORABLE COURT OF APPEALS, ATTY. HICOBLINO CATLY, LOURDES CATLY and
the REGISTER OF DEEDS, CALAPAN CITY, ORIENTAL MINDORO, Respondents.

Allegedly to defend themselves against the cases filed by respondent Catlys and to protect
their vested rights as lawful occupants of the land, the petitioners filed a complaint for
declaration of nullity of the four certificates of title issued in respondent Caltys names. 9 The
petitioners claimed they are occupants of the original Lot No. 2042 since 1946 and anchored
their continued right to occupy as lessees of the Municipality of Calapan. They also alleged
that the titles issued in respondent Catlys names (covering Lot No. 2042-A which were
subdivided into four lots) included portions that they claimed were part of Lot No. 2042-B
which belonged to the Municipality of Calapan. The petitioners consider the inclusion of these
portions of Lot No. 2042-B prejudicial to their interest as its actual occupants, hence, they
questioned respondent Catlys titles. Respondent Catlys, in turn, moved for the dismissal of

DECISION
BRION, J.:
FACTUAL BACKGROUND

14

the complaint asserting that it failed to state a cause of action and that the petitioners
(plaintiffs below) were not the real parties in interest.

RTC and insist that they have sufficient interest in praying for the annulment of respondent
Catlys titles, as their vested rights have been impaired.

In its September 7, 1999 Order,10 the Regional Trial Court (RTC) of Oriental Mindoro, Branch
39, ordered the dismissal of the complaint for declaration of nullity of respondent Catlys titles.
It found that the petitioners were in fact occupying portions of respondent Catlys Lot No.
2042-A. Although the petitioners were asserting a legal right to occupy the land by virtue of a
lease contract, the lease covered only Lot No. 2042-B the southern portion which belonged
to the Municipality of Calapan. The trial court discovered that the petitioners were occupying
areas outside those covered by their lessors title and concluded they had no cause of action
against respondent Catlys. The relevant portion of the September 7, 1999 Order said:

THE COURTS RULING


The Court resolves to dismiss the petition.
A petition for certiorari resolves only errors of jurisdiction
The petitioners have twice erroneously availed of the remedy of a certiorari petition, first,
before the CA against the RTC order dismissing its complaint for annulment of title, and
second, before the Court against the CAs decision thereon.
Time and again, we have discussed the nature of a certiorari petition it is intended to
correct only errors of jurisdiction where the court or tribunal has acted with grave abuse of
discretion. A writ of certiorari cannot be used for any other purpose; it cannot be used to
resolve questions or issues beyond its competence such as errors of judgment. Certiorari will
not be issued to cure errors by the trial court in its appreciation of the evidence of the parties,
its conclusions anchored on the said findings, and its conclusions of law.16

As consistently admitted by the [petitioners], they are occupying the lot belonging to the
Municipal Government of Calapan as occupant-lessees x x x it was ascertained that the
[petitioners] are outside the area covered by the Municipal Governments title. 11
Corollary to this, it declared that the petitioners were not the real parties in interest who could
assail and seek the annulment of the respondents title.

The supervisory jurisdiction of a court over the issuance of a writ of certiorari cannot be
exercised for the purpose of reviewing the intrinsic correctness of a judgment of the lower
court on the basis either of the law or the facts of the case, or of the wisdom or legal
soundness of the decision. Even if the findings of the court are incorrect, as long as it has
jurisdiction over the case, such correction is normally beyond the province of certiorari.
Where the error is not one of jurisdiction, but of an error of law or fact - a mistake of judgment
- appeal is the remedy.17[Emphasis supplied.]1avvphi1

The petitioners move to have the September 7, 1999 Order reconsidered was denied by the
RTC in its March 30, 2000 Order.12 They sought the reversal of the trial courts Orders by
filing a petition for certiorari under Rule 65 of the Rules of Court before the CA.
In a decision dated October 7, 2002, 13 the CA dismissed the petition and affirmed the RTCs
dismissal of the complaint for annulment of respondent Catlys titles. It ruled that petitioners
erred in filing a certiorari petition under Rule 65 of the Rules of Court to assail an order of
dismissal by the trial court. An order sustaining a motion to dismiss is a final adjudication on
the merits of the case and the remedy of the plaintiff is to appeal the order. This procedural
lapse notwithstanding, the CA proceeded to consider the petition as an ordinary appeal filed
under Rule 41.

In the two certiorari petitions the petitioners filed before the CA and before the Court, they
assailed rulings of the lower courts by claiming that the findings and conclusions of these
courts were merely speculative and based on misapprehension of facts. These assigned
errors, however, constitute an attack on the correctness or soundness of the decision
assailed and does not at all affect the jurisdiction of the court to issue such decision. In other
words, they amount to no more than errors of judgment correctible by an appeal, not by a writ
of certiorari that will issue only when there is no appeal, or any plain, speedy, and adequate
remedy in the ordinary course of law.18

Ruling on the merits of case, the CA agreed with the RTC that the petitioners have no cause
of action against respondent Catlys. The petitioners were assailing respondents Catlys titles
which were derived from TCT No. T-46154 covering Lot No. 2042-A. These titles, however,
are separate and distinct from the land that the petitioners are occupying which is registered
as TCT No. T-46155 covering Lot No. 2042-B in the name of the Municipality of Calapan.
Thus, their claimed vested rights in Lot No. 2042-B were not at all impaired by respondent
Catlys titles. Even assuming that a portion of respondent Catlys lot includes that belonging to
the Municipality of Calapan, the petitioners do not possess sufficient interest to assail
respondent Catlys titles as they are mere lessees.

Since an order of dismissal by the trial court is a final order from which an ordinary appeal
under Rule 41 can be taken, 19 the petitioners should have taken this avenue against the RTC
order of September 7, 1999 instead of resorting to a petition for certiorari before the CA.
Supreme Court Circular No. 2-90 is unequivocal in directing the dismissal of an inappropriate
mode of appeal:

The petitioners filed a motion for reconsideration of the CAs decision dated October 7,
2002.14 The CA denied the motion in a resolution dated March 6, 2003. 15 The petitioners now
seek to reverse these CA rulings before the Court via a petition for certiorari filed under Rule
65 of the Rules of Court. The petitioners reiterate the same arguments they raised before the

4. Erroneous Appeals An appeal taken to either the Supreme Court or the Court of Appeals
by the wrong or inappropriate mode shall be dismissed.
But rather than dismissing outright the petition, the CA, "in the interest of justice," decided to
treat it as an appeal filed under Rule 41 and consider the errors raised by the petitioners. As it
turned out, however, the CA still ruled for the petitions dismissal because it found that

15

petitioners did not have any cause of action against respondent Catlys and were not the real
parties in interest.

stands to be benefited or injured by the judgment in the suit. x x x The interest of the party
must be personal and not one based on a desire to vindicate the constitutional right of some
third and unrelated party.

As the petitioners now raise before this Court the same errors of judgment already raised
before and resolved by the CA, the dismissal of the present certiorari petition is in order for
being the wrong remedy. Errors of judgment committed by the CA are reviewable by this
Court via a petition for review on certiorari under Rule 45 of the Rules of Court. Erroneous
findings and conclusion do not render the appellate court vulnerable to the corrective writ of
certiorari.20

Clearly, a suit filed by a person who is not a party in interest must be dismissed. Thus, in
Lucas v. Durian, the Court affirmed the dismissal of a Complaint filed by a party who alleged
that the patent was obtained by fraudulent means and, consequently, prayed for the
annulment of said patent and the cancellation of a certificate of title. The Court declared that
the proper party to bring the action was the government, to which the property would revert.
Likewise affirming the dismissal of a Complaint for failure to state a cause of action, the Court
in Nebrada v. Heirs of Alivio noted that the plaintiff, being a mere homestead applicant, was
not the real party in interest to institute an action for reconveyance.

The petitioners invocation of a liberal application of the rules of procedure is unavailing. Even
if the Court were to consider the present petition as an appeal filed under Rule 45, we would
ultimately order its dismissal for failing to find any reversible error committed by the CA.

xxxx

An action for annulment of title, like any other civil action, must be instituted by the real party
in interest

Verily, the Court stressed that "if the suit is not brought in the name of or against the real party
in interest, a motion to dismiss may be filed on the ground that the complaint states no cause
of action."24 [Emphasis supplied.]

Section 2, Rule 3 of the Rules of Court states:


Sec. 2. Parties in interest. A real party in interest is the party who stands to be benefited or
injured by the judgment in the suit, or the party entitled to the avails of the suit. Unless
otherwise authorized by law or these Rules, every action must be prosecuted or defended in
the name of the real party in interest.

The petitioners demand the annulment of respondent Catlys titles because they allege that
these included portions belonging to the Municipality of Calapan. This allegation is a clear
recognition of the Municipalitys superior interest over the lot. In instituting the action for
annulment of respondent Catlys titles, what the petitioners are asserting is a right that is not
personal to them, but to that of the local government. That they are lessees who were
granted by the Municipality of Calapan the option to purchase the portion they occupy does
not suffice to constitute as parties with material interest to commence the action.

This provision has two requirements: 1) to institute an action, the plaintiff must be the real
party in interest; and 2) the action must be prosecuted in the name of the real party in
interest. Interest within the meaning of the Rules of Court means material interest or an
interest in issue to be affected by the decree or judgment of the case, as distinguished from
mere curiosity about the question involved. One having no material interest to protect cannot
invoke the jurisdiction of the court as the plaintiff in an action. When the plaintiff is not the real
party in interest, the case is dismissible on the ground of lack of cause of action. 21

WHEREFORE, premises considered, we hereby DISMISS the petitioners Petition for


Certiorari filed under Rule 65 of the Rules of Court. The Decision of October 7, 2002 and
Resolution of March 6, 2003 in CA-G.R. SP No. 58307 are AFFIRMED. Cost against the
petitioners.

An action for annulment of certificates of title to property into the issue of ownership of the
land covered by a Torrens title and the relief generally prayed for by the plaintiff is to be
declared as the lands true owner.22 The real party in interest in such action therefore is the
person claiming title or ownership adverse to that of the registered owner. The case of
Tankiko v. Cezar23 has illustrated for us the application of this principle in the following
manner:

SO ORDERED.
ARTURO D. BRION
Associate Justice

It is evident that respondents are not the real parties in interest. Because they admit that they
are not the owners of the land but mere applicants for sales patents thereon, it is daylight
clear that the land is public in character and that it should revert to the State. This being the
case, Section 101 of the Public Land Act categorically declares that only the government may
institute an action to recover ownership of a public land.
xxxx
Under Section 2, Rule 3 of the Rules of Court, every action must be prosecuted or defended
in the name of the real party in interest. It further defines a "real party in interest" as one who

16

the Regional Trial Court (RTC) of Cebu City, Branch XI dated June 29, 2000, which dismissed
the complaint filed by the respondents herein.1
The subject matter of the present case is a parcel of land known as Lot No. 1851 Flr-133 with
an aggregate area of 2,017 square meters located in Talisay, Cebu. 2
According to petitioners Faustino Reyes, Esperidion Reyes, Julieta C. Rivera, and Eutiquio
Dico, Jr., they are the lawful heirs of Dionisia Reyes who co-owned the subject parcel of land
with Anacleto Cabrera as evidenced by Transfer Certificate of Title (TCT) No. RT-3551 (T8070). On April 17, 1996, petitioners executed an Extrajudicial Settlement with Sale of the
Estate of Dionisia Reyes (the Extra Judicial Settlement) involving a portion of the subject
parcel of land. On March 21, 1997, the petitioners and the known heirs of Anacleto Cabrera
executed a Segregation of Real Estate and Confirmation of Sale (the Segregation and
Confirmation) over the same property. By virtue of the aforestated documents, TCT No. RT35551 (T-8070) was cancelled and new TCTs were issued: (1) TCT No. T-98576 in the name
of Anacleto Cabrera covering Lot 1851-A; (2) TCT No. T-98577 covering Lot 1851-B in the
name of petitioner Eutiquio Dico, Jr.; (3) TCT No. T-98578 covering Lot 1851-C in the name of
petitioner Faustino Reyes; (4) TCT No. T-98579 covering Lot 1851-D in the name of petitioner
Esperidion Reyes; (5) TCT No. T-98580 covering Lot 1851-E in the name of petitioner Julieta
G. Rivera; (6) TCT No. T-98581 covering Lot 1851-F in the name of Felipe Dico; and (7) TCT
No. T-98582 covering Lot 1851-G in the name of Archimedes C. Villaluz. 3

G.R. No. 162956

Respondents Peter B. Enriquez (Peter) for himself and on behalf of his minor daughter
Deborah Ann C. Enriquez (Deborah Ann), also known as Dina Abdullah Enriquez Alsagoff, on
the other hand, alleges that their predecessor-in-interest Anacleto Cabrera and his wife
Patricia Seguera Cabrera (collectively the Spouses Cabrera) owned pro-indiviso share in
the subject parcel of land or 1051 sq. m. They further allege that Spouses Cabrera were
survived by two daughters Graciana, who died single and without issue, and Etta, the wife
of respondent Peter and mother of respondent Deborah Ann who succeeded their parents
rights and took possession of the 1051 sq. m. of the subject parcel of land. During her
lifetime, Graciana sold her share over the land to Etta. Thus, making the latter the sole owner
of the one-half share of the subject parcel of land. Subsequently, Etta died and the property
passed on to petitioners Peter and Deborah Ann by virtue of an Extra-Judicial Settlement of
Estate. On June 19, 1999, petitioners Peter and Deborah Ann sold 200 sq. m. out of the 1051
sq. m. for P200,000.00 to Spouses Dionisio and Catalina Fernandez (Spouses Fernandez),
also their co-respondents in the case at bar. After the sale, Spouses Fernandez took
possession of the said area in the subject parcel of land. 4

April 10, 2008

FAUSTINO REYES, ESPERIDION REYES, JULIETA C. RIVERA, and EUTIQUIO DICO,


JR., petitioners,
vs.
PETER B. ENRIQUEZ, for himself and Attorney-in-Fact of his daughter DEBORAH ANN
C. ENRIQUEZ, and SPS. DIONISIO FERNANDEZ and CATALINA
FERNANDEZ, respondents.

When Spouses Fernandez, tried to register their share in the subject land, they discovered
that certain documents prevent them from doing so: (1) Affidavit by Anacleto Cabrera dated
March 16, 1957 stating that his share in Lot No. 1851, the subject property, is approximately
369 sq. m.; (2) Affidavit by Dionisia Reyes dated July 13, 1929 stating that Anacleto only
owned of Lot No. 1851, while 302.55 sq. m. belongs to Dionisia and the rest of the property
is co-owned by Nicolasa Bacalso, Juan Reyes, Florentino Reyes and Maximiano Dico; (3)

DECISION
PUNO, C.J.:
This case is a Petition for Review on Certiorari under Rule 45 of the Revised Rules of Court
from the decision of the Court of Appeals (CA) dated September 29, 2003 in CA G.R. CV No.
68147, entitled "Peter B. Enriquez, et al. v. Faustino Reyes, et al., reversing the decision of

17

case.17 Thus, a plaintiffs right to institute an ordinary civil action should be based on his own
right to the relief sought.

Extra-Judicial Settlement with Sale of the Estate of Dionisia Reyes dated April 17, 1996; (4)
certificates of title in the name of the herein petitioners; and (5) Deed of Segregation of Real
Estate and Confirmation of Sale dated March 21, 1997 executed by the alleged heirs of
Dionisia Reyes and Anacleto Cabrera. Alleging that the foregoing documents are fraudulent
and fictitious, the respondents filed a complaint for annulment or nullification of the
aforementioned documents and for damages. 5 They likewise prayed for the "repartition and
resubdivision" of the subject property.6

In cases wherein alleged heirs of a decedent in whose name a property was registered sue to
recover the said property through the institution of an ordinary civil action, such as a
complaint for reconveyance and partition, 18or nullification of transfer certificate of titles and
other deeds or documents related thereto, 19 this Court has consistently ruled that a
declaration of heirship is improper in an ordinary civil action since the matter is "within the
exclusive competence of the court in a special proceeding." 20 In the recent case of Portugal
v. Portugal-Beltran,21 the Court had the occasion to clarify its ruling on the issue at hand, to
wit:

The RTC, upon motion of the herein petitioners, dismissed the case on the ground that the
respondents-plaintiffs were actually seeking first and foremost to be declared heirs of
Anacleto Cabrera since they can not demand the partition of the real property without first
being declared as legal heirs and such may not be done in an ordinary civil action, as in this
case, but through a special proceeding specifically instituted for the purpose. 7

The common doctrine in Litam, Solivio and Guilas in which the adverse parties are putative
heirs to the estate of a decedent or parties to the special proceedings for its settlement is that
if the special proceedings are pending, or if there are no special proceedings filed but
there is, under the circumstances of the case, a need to file one, then the
determination of, among other issues, heirship should be raised and settled in said
special proceedings. Where special proceedings had been instituted but had been finally
closed and terminated, however, or if a putative heir has lost the right to have himself
declared in the special proceedings as co-heir and he can no longer ask for its re-opening,
then an ordinary civil action can be filed for his declaration as heir in order to bring about the
annulment of the partition or distribution or adjudication of a property or properties belonging
to the estate of the deceased.22

On appeal, the Court of Appeals (CA) reversed the RTC and directed the trial court to
proceed with the hearing of the case. 8 The Motion for Reconsideration filed by the herein
petitioners was similarly denied.9
Hence this petition.
The primary issue in this case is whether or not the respondents have to institute a special
proceeding to determine their status as heirs of Anacleto Cabrera before they can file an
ordinary civil action to nullify the affidavits of Anacleto Cabrera and Dionisia Reyes, the ExtraJudicial Settlement with the Sale of Estate of Dionisia Reyes, and the Deed of Segregation of
Real Estate and Confirmation of Sale executed by the heirs of Dionisia Reyes and the heirs
of Anacleto Cabrera, as well as to cancel the new transfer certificates of title issued by virtue
of the above-questioned documents.

In the instant case, while the complaint was denominated as an action for the "Declaration of
Non-Existency[sic], Nullity of Deeds, and Cancellation of Certificates of Title, etc.," a review of
the allegations therein reveals that the right being asserted by the respondents are their right
as heirs of Anacleto Cabrera who they claim co-owned one-half of the subject property and
not merely one-fourth as stated in the documents the respondents sought to annul. As
correctly pointed out by the trial court, the ruling in the case of Heirs of Guido Yaptinchay v.
Hon. Roy del Rosario23 is applicable in the case at bar. In the said case, the petitioners
therein, claiming to be the legal heirs of the late Guido and Isabel Yaptinchay filed for
annulment of the transfer certificates of title issued in the name of Golden Bay Realty
Corporation on the ground that the subject properties rightfully belong to the petitioners
predecessor and by virtue of succession have passed on to them. In affirming the trial court
therein, this Court ruled:

We answer in the affirmative.


An ordinary civil action is one by which a party sues another for the enforcement or protection
of a right, or the prevention or redress of a wrong. 10 A special proceeding, on the other hand,
is a remedy by which a party seeks to establish a status, a right or a particular fact. 11
The Rules of Court provide that only a real party in interest is allowed to prosecute and
defend an action in court.12 A real party in interest is the one who stands to be benefited or
injured by the judgment in the suit or the one entitled to the avails thereof. 13 Such interest, to
be considered a real interest, must be one which is present and substantial, as distinguished
from a mere expectancy, or a future, contingent, subordinate or consequential interest. 14 A
plaintiff is a real party in interest when he is the one who has a legal right to enforce or
protect, while a defendant is a real party in interest when he is the one who has a correlative
legal obligation to redress a wrong done to the plaintiff by reason of the defendants act or
omission which had violated the legal right of the former.15The purpose of the rule is to protect
persons against undue and unnecessary litigation. 16 It likewise ensures that the court will
have the benefit of having before it the real adverse parties in the consideration of a

...(T)he plaintiffs who claimed to be the legal heirs of the said Guido and Isabel Yaptinchay
have not shown any proof or even a semblance of it except the allegations that they are
the legal heirs of the aforementioned Yaptinchays that they have been declared the legal
heirs of the deceased couple. Now, the determination of who are the legal heirs of the
deceased couple must be made in the proper special proceedings in court, and not in an
ordinary suit for reconveyance of property. This must take precedence over the action for
reconveyance.24

18

In the same manner, the respondents herein, except for their allegations, have yet to
substantiate their claim as the legal heirs of Anacleto Cabrera who are, thus, entitled to the
subject property. Neither is there anything in the records of this case which would show that a
special proceeding to have themselves declared as heirs of Anacleto Cabrera had been
instituted. As such, the trial court correctly dismissed the case for there is a lack of cause of
action when a case is instituted by parties who are not real parties in interest. While a
declaration of heirship was not prayed for in the complaint, it is clear from the allegations
therein that the right the respondents sought to protect or enforce is that of an heir of one of
the registered co-owners of the property prior to the issuance of the new transfer certificates
of title that they seek to cancel. Thus, there is a need to establish their status as such heirs in
the proper forum.

DECISION
PEREZ, J.:
A claim of status as heir of a decedent must always be substantially supported by evidence
as required under ourlaw. The resolution of a case, in this instance, an action for annulment
of title and reconveyance of real property, cannot be further stalled and waylaid by a mere
assertion of a party of an ostensible conflicting claims of heirship of the common decedent.
Not all rights to property and incidents thereof, such as titling, ought to be preceded by a
declaration of heirship, albeit supposedly traced to a single decedent and original titleholder.
Before us is a petition for review on certiorari under Rule 45 of the Rules of Court assailing
the Decision ofthe Court of Appeals in CA-G.R. SP No. 99853 1 which reversed and set aside
the rulings, after trial and then on appeal, of the Municipal Trial Court (MTC) and Regional
Trial Court (RTC), Sta. Rosa, Laguna in Civil Case No. 1913 2 and Civil Case No. B6334,3 respectively. The trial courts annulled TCT No. 294295 issued in the name of
Crispiniano Talampas Basbas (Crispiniano) and herein respondent Ricardo Talampas Basbas
(Ricardo), covering Lot No. 39 of the Santa Rosa Detached Estate, the subject property, and
originally titled to the decedent, Severo Basbas (Severo) under Certificate of Title No. RT1684 (N.A.). Crispiniano and Ricardo and all their successors-in-interest were ordered to
reconvey the subject property to petitioners.

Furthermore, in Portugal,25 the Court held that it would be superfluous to still subject the
estate to administration proceedings since a determination of the parties' status as heirs
could be achieved in the ordinary civil case filed because it appeared from the records of the
case that the only property left by the decedent was the subject matter of the case and that
the parties have already presented evidence to establish their right as heirs of the decedent.
In the present case, however, nothing in the records of this case shows that the only property
left by the deceased Anacleto Cabrera is the subject lot, and neither had respondents Peter
and Deborah Ann presented any evidence to establish their rights as heirs, considering
especially that it appears that there are other heirs of Anacleto Cabrera who are not parties in
this case that had signed one of the questioned documents. Hence, under the circumstances
in this case, this Court finds that a determination of the rights of respondents Peter and
Deborah Ann as heirs of Anacleto Cabrera in a special proceeding is necessary.

Both parties, petitioners, Heirs ofValentin Basbas (Valentin), and respondent Ricardo trace
their claim ofownership over herein subject property to Severo.
Petitioners filed an Action for Annulment of Title, Reconveyance with Damages against
Crispiniano and respondent Ricardo seeking to: (1) annul Transfer Certificate of Title No. T294295 issued in the names of Crispiniano and Ricardo covering the contested lot, and (2)
recover possession of the subject property beforethe Municipal Trial Court, Santa Rosa,
Laguna, docketed as Civil Case No. 1913.

IN VIEW WHEREOF, the petition is GRANTED. The decision of the Court of Appeals is
hereby REVERSED and the decision of the Regional Trial Court dated June 29,
2000 DISMISSING the complaint is REINSTATED.
G.R. No. 188773

Countering petitioners allegations, Crispiniano and Ricardo denied petitioners ownership


over Lot No. 39 and contended that upon Severos death, he was survived by two
heirs,Valentin (grandfather of petitioners) and Nicolas Basbas (Nicolas) (paternal grandfather
of Crispiniano and Ricardo) who evenly divided Severos estate, comprising of two lots,
herein subject property, Lot No. 39 of the Santa Rosa Detached Estate, and Lot No. 40,
adjacent thereto, among them. Lot No. 40 was inherited by Valentin, while Lot No. 39 went to
Nicolas.

September 10, 2014

HEIRS OF VALENTIN BASBAS, ANSELMA B. ENDRINAL, GERTRUD ES BASBAS,


RUFINA BASBAS, CEFERINA B. CARTECIANO, ANACLETO BASBAS, ARSENIA
BASBAS, ANASTACIO BASBAS, BEDACIO BASBAS, TEODOCIA B. OCAMPO,
SEGUNDO C. BASBAS, MARIA B. RAMOS AND EUGENIO BASBAS IN
REPRESENTATION OF PEDRO BASBAS; HERINO T. BASBAS AND NESTOR T.
BASBAS IN REPRESENTATION OF LUCAS BASBAS; ADELAIDA B. FLORENTINO,
RODRIGO BASBAS, FELIX BASBAS, JR., TEODULO BASBAS, ANDRESITO BASBAS,
LARRY BASBAS AND JOEY BASBAS IN REPRESENTATION OF FELIX BASBAS, SR.,
VICTOR BEATO, ALIPIO BEATO, EUTIQUIO BEATO, JULIANA B. DIAZ, PABLO BEATO
AND ALEJANDRO BEATO IN REPRESENTATION OF REMIGIA B. BEATO, AS
REPRESENTED
BY
RODRIGO
BASBAS, Petitioners,
vs.
RICARDO BASBAS as represented by EUGENIO BASBAS, Respondents.

The pertinent documents presented in evidence by both parties include:


(1) Certificate of Title No. RT-1684 (N.A.) in the name of Severo;
(2) Order of the Land Registration Court, Regional Trial Court, Bian, Laguna dated 1 June
1989, granting the Petition for Reconstitution of Title covering Lot No. 39 filed by Crispiniano
and Ricardo;
(3) TCT No. T-294295 covering Lot No. 39 issued in the names of Crispiniano and Ricardo;
and (4) Extra-Judicial Settlement ofEstate of decedent Severo.

19

The undisputed facts uniformly found by all three lower courts, at the first instance, the MTC,
the RTC, Branch 24, Bian, Laguna, in the exercise of its appellate jurisdiction, and the Court
of Appeals are:

2) ordering the defendants [including herein respondent Ricardo] to reconvey to [petitioners]


Lot No. 39 of the Santa Rosa Detached Estate, and to surrender possession thereof in favor
of the [petitioners];

x x x Severo Basbas was married toAna Rivera. Severo x x x died on July 14, 1911. They had
a child named Valentin (Basbas). During Severos lifetime, he acquired a parcel of land in
Santa Rosa, Laguna otherwise known as Lot No. 39 of the Santa Rosa Detached Estate. Lot
No. 39 is adjacent to Lot No. 40 of the Santa Rosa Detached Estate which lot was acquired,
by purchase, by Valentin Basbas. Sometime in 1995, [herein petitioners Heirs of Valentin
Basbas] discovered that [respondents] Crispiniano and Ricardo Basbas were able to secure
for themselves Transfer Certificate of Title No. T-294295 over Lot No. 39 of the Santa Rosa
Detached Estate. Sometime in 1987, [respondents], through Crispiniano Basbas, filed a
Petition for Reconstitution of Title before the Regional Trial Court, Bian, Laguna, docketed
as LRC Case No. B-758, covering Lot No. 39 of the Santa RosaDetached Estate.
Subsequently thereafter, or on June 1, 1989, an Order was issued by the RTC granting the
aforesaid petition. On the basis of said Order, the title covering Lot No. 39 was ordered
reconstituted in the name of the heirs of Severo Basbas and Transfer Certificate of Title No.
RT-1684 (N.A.) was issued. On November 13, 1993, [therein] defendants Crispiniano Basbas
y Talampas and [respondent] Ricardo Basbas y Talampas executed an Extra-Judicial
Settlement of Estate of deceased Severo Basbas x x x stating among others that the only
heirs of Severo Basbas are Felomino Basbas and Melencio Casubha. On the basis of said
Extra-Judicial Settlement x x x, the Registry of Deeds of Calamba, Laguna cancelled Transfer
Certificate of Title No. RT-1684 and in lieu thereof Transfer Certificate of Title No. T-294295
was issued in the names of [therein] defendants Crispiniano Basbas and [respondent]
Ricardo Basbas x x x. [Petitioners] then brought the matter to the Barangay but no settlement
was reached. Hence, this instant action.4

3) ordering the Register of Deeds of Calamba, Laguna to issue a new certificate of title
covering said Lot No. 39 in favor of the heirs of Severo Basbas; and
4) ordering the defendants [including herein respondent Ricardo] and their successors-ininterest to pay [petitioners] the sum of Php 50,000.00 as and for attorneys fees. 6
On appeal to the RTC by Crispiniano and Ricardo docketed as Civil Case No. B-6334,
judgment of the MTC was affirmed in toto.
Insistent on their stance, Crispiniano and Ricardo appealed to the Court of Appeals.
In a subsequent turn of events, the appellate court reversed, applying our ruling in Heirs of
Yaptinchay v. Hon. del Rosario,7 and set aside the uniform rulings of the trial courts:
The court a quoerred in affirming the decision of the MTC, as the MTC had ruled on filiation
and heirship, matters which fall within the jurisdiction of a probate court, which the MTC or
RTC of Sta. Rosa, Laguna were not designated to be. It isalso proper that these particular
matters be threshed out in a special proceeding.
In Heirs of Guido and Isabel Yaptinchay v. Del Rosario, it was ruled that it is decisively clear
that the declaration of heirship can be made only in a special proceeding inasmuch as it
involves the establishment of a status or right.
The case at bar is an action for annulment of title, reconveyance with damages, a civil action,
whereas matters which involve the settlement and distribution of the estate of a deceased
person as well as filiation and heirship partake of the nature of a special proceeding, which
requires the application of specific rules as provided for in the Rules of Court. With both
parties claiming to be the heirs of Severo Basbas, it is but proper to thresh out this issue in a
special proceeding, since [Crispiniano and respondent Ricardo] seeks to establish his status
as one of the heirs entitled to the property in dispute. Before the action for annulment of title,
reconveyance with damages can beresolved, this Court opines that the matter of heirship
should be adjudicated upon first. The trial court cannot make a declaration of heirship in the
civil action for the reason that such a declaration can only be made in a special proceeding.

Significantly, the Pre-Trial Order of the MTC, dated 2 September 1998, contained the
following Stipulation of Facts:
STIPULATION OF FACTS
1. [Severo] Basbas is married to Ana Rivera.
2. Both Crispiniano Basbas and Ricardo Basbas bear the middle name Talampas.

xxxx

3. [Petitioners] are direct descendants of Valentin Basbas, who is a son of [Severo] Basbas.

WHEREFORE, judgment is hereby rendered in favor of [petitioners] and against defendants


[including herein respondent Ricardo] as follows:

The MTC and the RTC, both acting in their general jurisdiction, are devoid of authority to
render an adjudication and resolve the issue of annulment of title and reconveyance of the
real property in favor of the respondents. We reiterate that the question of who are the heirs
of Severo Basbas should be adjudged first in a probate court prior to the resolution of the
action for annulment of title and reconveyance.

1) declaring TCT No. T-294295 in the name of the defendants [including herein respondent
Ricardo] as NULL and VOID;

WHEREFORE, IN VIEW OF THE FOREGOING, the decision appealed from is hereby


REVERSED and SET ASIDE.8

4. The property at dispute was originally registered in [Severos] name. 5


After trial, where both parties presented evidence, the MTC ruled, thus:

Hence, this appeal by certiorariof petitioners Heirs of Valentin, raising the following issues:
I

20

WHETHER OR NOT THE COURT OF APPEALS SERIOUSLY ERRED IN REVERSING AND


SETTING ASIDE THE DECISION OF THE REGIONAL TRIAL COURT BRANCH 24 OF
BIAN, LAGUNA AFFIRMING THAT OF THE MUNICIPAL TRIAL COURT OF SANTA ROSA,
LAGUNAS DECISION FINDING FOR THE PETITIONERS.

been made orbrought during the lifetime of the presumed parents x x x. It could noteven be
applied under the exception of said law x x x, as no evidence was ever adduced to that effect.
The only conclusion, therefore, is that Nicolas Basbas was neither a legitimate nor an
illegitimate son of Severo Basbas, so that defendants [including herein respondent Ricardo]
are not the legal heirs of the late Severo Basbas.

II

x x x [T]he defendants [including herein respondent Ricardo] are not the legal heirs of the late
SeveroBasbas. They (defendants) [including herein respondent Ricardo] claimed that they
derived their title and ownership over Lot No. 39 in representation of Felomino Basbas, an
alleged son of the late Severo Basbas; that Severo Basbas gave Lot No. 39 to Nicolas
Basbas; and that Lot No. 40 was also given by Severo Basbas to Valentin Basbas. Such a
claim has no basis at all. The [petitioners] evidence, specifically the Friar Lands Certificate x
x x and the Certification from the DENR x x x show that Valentin Basbas acquired Lot No. 40
of the Santa Rosa Detached Estate by purchase from the government way back on April 1,
1913, contrary to the allegations of the defendants [including herein respondentRicardo] that
the same was given by Severo Basbas to Valentin Basbas as the latters share in the
inheritance.10

WHETHER OR NOT THE COURT OF APPEALS SERIOUSLY ERRED IN APPLYING THE


RULING INHEIRS OF GUIDO AND ISABEL YAPTINCHAY VERSUS HON. ROY S. DEL
ROSARIO, THAT PRIOR TO THE RESOLUTION OF THE ACTION FOR ANNULMENT OF
TITLE AND RECONVEYANCE, THE DETERMINATION OF WHO THE HEIRS ARE SHOULD
FIRST BE ADJUDGED IN A PROBATE COURT.
III
WHETHER OR NOT THE COURT OF APPEALS SERIOUSLY ERRED IN FAILING TO
RENDER JUDGMENT BASED ON THE EVIDENCE PRESENTED RELATIVE TO THE
ISSUES RAISED AND RULED UPON BY THE MUNICIPAL TRIAL COURT OF SANTA
ROSA, LAGUNA AND THE REGIONAL TRIAL COURT OF BIAN, LAGUNA.9
In ruling in favor of petitioners, Heirs of Valentin, the trial courts found that petitioners fully
established their filiation with the decedent Severo, the original titleholder of Lot No. 39 and
from whom all parties trace their claim of ownership over the subject property. Oppositely, the
trial courts found wanting, lacking documentary evidence, the different claims of heirship of
Crispiniano and herein respondent Ricardo, through Severos purported other son or nephew,
Nicolas. The MTC, affirmed in toto by the RTC, declared, thus:

In marked contrast, the Court of Appeals zeroed in on the claim of Crispiniano and Ricardo
that they are descendants, likewise great grandchildren, of Severo and inherited Lot No. 39
from their father Felomino Basbas, Severos grandson from the latters son, Nicolas, who
received the subject property as his share in Severos estate. On the whole, the appellate
court ruled that the MTC and the RTC, acting in their general jurisdiction, did not have
authority to rule on issues of filiation and heirship of the parties to the decedent Severo, such
matters to be sorted and established in a special proceeding and falling within the jurisdiction
of a probate court.

[Petitioners] have fully established their true filiation with the late Severo Basbas from whom
the subject property came from. Through their own evidence, testimonial and documentary, it
was established that Severo Basbas was married to Ana Rivera. They had one (1) child
named Valentin Basbas x x x. Valentin Basbas had no other brother nor sister. He (Valentin)
was married to Irene Beato. Valentin bore four (4) children, namely: (1) Pedro Basbas; (2)
Lucas Basbas; (3) Feliz Basbas, Sr.; and (4) Remigia Basbas. x x x.

The pivotal issue in this case turns on the applicability of our ruling in Heirs of Yaptinchay v.
Hon. del Rosario.
We cannot subscribe to the appellate court's ruling unqualifiedly applying Heirs of Yaptinchay.
Mistakenly, the Court of Appeals glosses over facts, not controverted by Crispiniano and
respondent Ricardo:

xxxx
As shown, [petitioners] are now the great grandchildren of the late Severo Basbas who died
in Santa Rosa, Laguna on July 5, 1911.

(1) Valentin was a legitimate child of Severo and Ana Rivera; and (2) Petitioners are
themselves legitimate descendants of Valentin.

The defendants [including herein respondent Ricardo] on the other hand claim that they are
also the legal heirs of the late Severo Basbas. Such a claim, however, was not supported by
any document. x x x.

Not only is the petitioners heirshipto Severo uncontroverted. The status of Valentin as a
compulsory heirof Severo and of petitioners statuses as heirs of Valentin and Severo are
stipulated facts agreed to by Crispiniano and respondent Ricardo:

xxxx

1. [Severo] Basbas is married to Ana Rivera.

As correctly pointed out by [petitioners] that assuming, for the sake of argument, that Nicolas
Basbas, predecessor of these defendants [including herein respondent Ricardo], was the son
of Severo Basbas, then Nicolas Basbas must have been an illegitimate child of Severo
Basbas, in which case his filiation should be first established before he can claim to be an
heir. But this cannot be done anymore, simply because an action for recognition should have

2. Both Crispiniano Basbas and Ricardo Basbas bear the middle name Talampas.
3. [Petitioners] are direct descendants of Valentin Basbas, who is a son of [Severo] Basbas.
4. The property at dispute was originally registered in [Severos] name. 11

21

A That is what I know. That is what my brother told me. 12

On the other hand, Crispiniano and respondent Ricardo miserably fail to establish the status
of their ascendant and purported predecessor-ininterest, Nicolas. In fact, the testimony of
respondent Ricardo tells about the status of Valentin, not about Nicolas status, as a
compulsory heir of Severo:
A Yes, sir.

Mauro Basbas (Mauro), one of the defendants before the trial court, while testifying, also
failed to shed lighton the status of Nicolas as an heir of Severo, insisting only that Nicolas is
Severos son as told to him by his grandfather, Felomino Basbas. Mauro even categorically
answered that the wife of Severo is Ana Rivera, further establishing the legitimacy of Valentin
as the son of Severo and Ana Rivera:

Q Why do you know them Mr. Witness?

Q Who is the father of Felomino Basbas?

A They are my relatives, sir.

A Nicolas Basbas.

Q Will you tell us specifically what is your relationship with [petitioners] in this case, Mr.
Witness?

Q You mean to tell us that Nicolas is the son of Severo Basbas?

A They are my cousins, I used to call them "Kuya."

Q Do you happen to know the mother of Felomino Basbas?

Q How come you became the relatives of [petitioners,] (sic) Mr. Witness?

A Yes.

A My father and the father of [petitioners] are relatives.

Q Would you tell us?

Q Specifically, what is the name ofthe father of [petitioners], Mr. Witness?

A Catalina Mane.

A Valentin Basbas.
Q What is the name of your father?

Q Since you seem to be so well informed about the family of Severo Basbas, can you tell us
who was the wife of Severo Basbas?

A Felomino Basbas.

A Ana Rivera.

Q How is Felomino and Valentin related?

Q How can you say now unless you are implying that Severo Basbas had an illegitimate son,
how can you explain now why the surname the middle name of your grandfather is [not]
Rivera?

Q Now, do you know also [petitioners] in this case the heirs of Valentin Basbas, Mr. Witness?

A Yes.

A They are cousins.


Court

Court

How come they became [your] cousins?

xxxx

A Their family names are both Basbas.

What is the middlename (sic) of Severo Basbas? A I dont know.

Q And that is your only basis in saying that they are relatives?

Court

A No.

Who is the son of Severo Basbas? A Nicolas Basbas.

Q So, what other basis?

Q What is the maiden name (sic) of Nicolas Basbas?

A Severo Basbas is the eldest and he bore a child name[d] Nicolas Basbas and Nicolas
Basbas bore a child name[d] Felomino Basbas who [had] two sons named Crispiniano and
Ricardo Basbas.

A I dont know.13
In all, Valentins long-possessed status as a legitimate child and thus, heir of Severo, need no
longer be the subject of a special proceeding for declaration of heirship as envisioned by the
Court of Appeals. There is no need to re-declare his statusas an heir of Severo.

xxxx
Q Who was the father of Valentin Basbas then?

And, contraposed to the fact that Valentins status as a legitimate child of Severo is already
established, Nicolas status as a purported heir of Severo can no longer be established,
Nicolas right thereto expiring upon his death.

A Severo Basbas.
Q You said a while ago that Nicolas Basbas is the son of Severo Basbas and now you are
saying that Valentin Basbas is the son of Severo Basbas, you mean to say that Valentin
Basbas and Nicolas Basbas are brothers?

Glaringly, there is no pretension from respondents end that Nicolas was born of a valid
marriage, only that he is Severos son. Nonetheless, even if respondents were minded to
establish the status of Nicolas, whether he is a legitimate or an illegitimate child of Severo,
such can no longer be done.

A Yes, Nicolas is the eldest[older] th[a]n Valentin Basbas.


Q So, it is clear now that Nicolas and Valentin Basbas are brothers?

22

Article 165, in relation to Articles 173 and 175, of the Family Code and Article 285 of the Civil
Code state:

As was set forth in the dispositive portion of Suarez, "Civil Case No. 51203 is reinstated only
to determine that portion which belongs to [herein respondents] and to annul the sale with
regard to said portion." There is clearly no intimation in our decision for the RTC to have to
determine an already settled issue i.e., herein respondents' status as heirs of Marcelo Sr.

Art. 165. Children conceived and born outside a valid marriage are illegitimate, unless
otherwise provided in this Code.
Art. 173. The action to claim legitimacy may be brought by the child during his or her lifetime
and shall be transmitted to the heirs should the child die during minority or in a state of
insanity. In these cases, the heirs shall have a period of five years within which to institute the
action.

Moreover, petitioner Valente cannot assail, directly or indirectly, the status of herein
respondents as legitimate children of Marcelo Sr. and Teofista, and likewise demand that
herein respondents first prove their filiation to Marcelo Sr. The following records bear out
Marcelo, Sr.'s and Teofista's paternity of herein respondents, and the latter's status as
legitimate children:

Art. 175. Illegitimate children may establish their illegitimate filiation in the same way and on
the same evidence as legitimate children. The action must be brought within the same period
specified in Article 173, except when the action is based on the second paragraph of Article
172, in which case the action may be brought during the lifetime of the alleged parent.

1. The CA decision in CA-G.R. SP Nos. 10646 to 10649 where Teofista, along with herein
respondents, questioned the RTC, Branch 151's Orders dated October 10, 1984 and October
14, 1986. Although the CA ruled against Teofista and herein respondents, it explicitly
recognized the latter's status as legitimate children of Teofista and Marcelo Sr.; and

CHAPTER
ILLEGITIMATE CHILDREN

2. The CA decision in CA-G.R. SP No. 20320 which incorrectly ruled that herein respondents
were, as children of Teofista, merely successors-ininterest of the latter to the property and by
virtue thereof, bound by the judgment in Civil Case Nos. 21376 to21379 consistent with the
doctrine of res judicata. We subsequently reversed this ruling on the wrong application of res
judicatain the conclusive case of Suarez. We retained and affirmed, however, the CA's factual
finding of herein respondents' status as heirs of Marcelo Sr. We categorically held therein that
"the proprietary interest of [herein respondents] in the levied and auctioned [properties] is
different from and adverse to that of [Teofista]. [Herein respondents] became co-owners of
the property not because of [Teofista] but through their own right as children of their deceased
father [, Marcelo Sr.]." Clearly, herein respondents'long possessed status of legitimate
children of Marcelo Sr. and Teofista cannot be indirectly or directly attacked by petitioner
Valente in an action to annul a judicial sale.

Chapter 3. Illegitimate Children

SECTION 1. - Recognition of Natural Children


Art. 285. The action for the recognition of natural children may be brought only during the
lifetime of the presumed parents, except in the following cases:
(1) If the father or mother died during the minority of the child, in which case the latter may file
the action beforethe expiration of four years from the attainment of his majority;
(2) If after the death of the fatheror of the mother a document should appear of which nothing
had been heard and in which either or both parents recognize the child.
In this case, the action must be commenced within four years from the finding of the
document.

Articles 262, 263, 265 and 266 of the Civil Code, the applicable law at the time of Marcelo's
death, support the foregoing conclusion, to wit:

Our ruling in Raymundo v. Vda. de Suarez14 is instructive:


Petitioner Valente insists that, following our ruling in Heirs of Yaptinchay v. Del Rosario,
herein respondents must first be declared heirs of Marcelo Sr. before they can file anaction to
annul the judicial sale of what is, undisputedly, conjugal property of Teofista and Marcelo Sr.

Art. 262. The heirs of the husband may impugn the legitimacy of the child only in the following
cases:

We disagree. Our ruling in Heirs of Yaptinchayis not applicable.

(1) If the husband should die before the expiration of the period fixed for bringing his action;

Herein respondents' status as legitimate children of Marcelo Sr. and Teofista and thus,
Marcelo Sr.'s heirs has been firmly established, and confirmed by this Court in Suarez v.
Court of Appeals. True, this Court is not a trier of facts,but as the final arbiter of disputes, we
found and so ruled that herein respondents are children, and heirs of their deceased father,
Marcelo Sr. This having been settled, it should no longer have been a litigated issue whenwe
ordered a remand to the lower court. In short, petitioner Valente's,Violeta's, Virginia's, and
Maria Concepcion's representation in the RTC that our ruling in Suarez required herein
respondents to present evidence of their affiliation with the deceased, Marcelo Sr., is wrong.

(2) If the husband should die after the filing of the complaint, without having desisted from the
same;
(3) If the child was born after the death of the husband.
Art. 263. The action to impugn the legitimacy of the child shall be brought within one year
from the recording of birth in the Civil Register, if the husband should be in the same place, or
in a proper case, any of his heirs. If he or his heirs are absent, the period shall be eighteen
months if they should reside in the Philippines; and two years if abroad. If the birth of the child
has been concealed, the term shall be counted from the discovery of the fraud.

23

Art. 265. The filiation of legitimate children is proved by the record of birth appearing in the
Civil Register, or by an authentic document or a final judgment.

During the hearing of the petition, Atty. Agapito G. Carait, counsel for the petitioner, presented
Crispiniano Basbas.1wphi1 Together with his testimony, the following documentary evidence
were presented, to wit:

Art. 266. In the absence of the titles indicated in the preceding article, the filiation shall be
proved by the continuous possession of status of a legitimate child.

1wphi1

In Heirs of Yaptinchay, the complaint for annulment and/or declaration of nullity of certain
TCT's was dismissed for failure of the petitioners to demonstrate "any proof or even a
semblance of it" that they had been declared the legal heirs of the deceased couple, the
spouses Yaptinchay. In stark contrast, the records of this case reveal a document, an
Extrajudicial Settlement of Marcelo Sr.'s estate, which explicitly recognizes herein
respondents as Marcelo Sr.'s legitimate children and heirs. The same document settles and
partitions the estate of Marcelo Sr. specifying Teofista's paraphernal properties, and
separates the properties she owns in common with her children, herein respondents. Plainly,
there is no need to re-declare herein respondents as heirs of Marcelo Sr., and prolong this
case interminably.15

Exhibits "A"

the publication in the Official Gazette;

"B"

Certificate of Posting;

"C"

Report;

"D"

Certification form from the Register of Deeds; and

"E"

Friar Lands Sale Certificate.

CRISPINIANO BASBAS, 70 years old, widower and a resident of Santa Rosa, Laguna, stated
that he is the petitioner in this case; that the parcel of land involved in this case is situated at
Aplaya, Santa Rosa, Laguna and is identified as Lot No. 39 of the Santa Rosa Detached
Estate with an area of 330 sq. m.; that he was born in that property; that this parcel of land
was covered by a title in the name of the heirs of Severo Basbas; that the title was lost during
the Japanese Occupation when his father Felomino Basbas who was thenin possession of
the duplicate title, evacuated to the Province of Rizal particularly in Tanay; that later on his
father moved to Sta. Maria, Laguna; thathe was with his father when they evacuated to a
place called Laranga; thatwhile there, he saw the title in the possession of his father in the
"maleta" where he kept it; that when they returned to Santa Rosa, Laguna, he asked his
father regarding the Transfer Certificate of Title and his father told him that the title was lost in
the mountains of Rizal; the petitioner verified from the Office of the Register of Deeds if said
title is still intact with their office; that the Register of Deeds issued a certification (Exhibit "D")
to the effect that Lot 39 of Santa Rosa Detached Estate has no record on file with the office;
that petitioner went to the Bureau of Lands to verify the title and found out that the said patent
was issued in the name of the legal heirs of Severo Basbas (Exhibit "E"); that the children of
the petitioner are now in possession of Lot 39; that the petitioners father had paid the realty
taxes and after his death, he (petitioner) continued paying the taxes; that his father exerted all
efforts to recover or find the said title but the same proved futile; and that to his own
knowledge, Transfer Certificate of Title No. (N.A.) covering Lot No. 39 has never been
encumbered, sold or given as security for the performance of any obligation.

Thus, we find no need for a separateproceeding for a declaration of the heirs of Severo in
order to resolve petitioners Action for Annulment of Title and Reconveyance of the subject
property. Prescinding from the foregoing, a closer scrutiny of the documents presented in
evidence by Crispiniano and Ricardo before the trial court, betray the fraudulence of their
claim.
1. Order of the RTC, Branch 25, Bian, Laguna in LRC B-758, a Petition for Reconstitution of
Title filed by Crispiniano and respondent Ricardo:
Petitioner alleges that a certain parcel of residential land, situated in the Municipality of Santa
Rosa, Province of Laguna is registered in the name of the legal heirs of Severo Basbas as
evidenced by a Transfer Certificate of Title No. (N.A.) of the Register of Deeds of Laguna
(Exhibit "E"); that the aforementioned duplicate copy of Transfer Certificate of Title No. (N.A.)
was lost during the latter part of the Japanese Occupation when the petitioner and his family
evacuated from their residence to evade the atrocities being committed by the Japanese
soldiers; that after peace and order was restored, diligent efforts were exerted in trying to find
the said certificate of title, but the same proved futile; and that pursuant to the provisions of
R.A. No. 26, petitioner desires that the original copy of said title be reconstituted and
thereafter have the full technical description of Lot No. 39 of the Santa Rosa Detached Estate
be inscribed therein.
Pursuant to Section 12 of Republic Act No. 26 copies of the petition, notice of hearing, plan
and technical description of Lot No. 39 of the Santa Rosa Detached Estate were forwarded to
the Office of the Land Registration Commission for appropriate action. On January 18, 1989,
this Court received the Report (Exhibit "C") of the Acting Administrator of the Land
Registration Commission (now NLTDRA).

xxxx
Thus, the Administrator of the Land Registration Authority, in his REPORT dated January 18,
1989 recommends:
WHEREFORE, the foregoing information relative to Lot No. 39, Santa Rosa Detached Estate,
is respectfully submitted for consideration in the resolution ofthe instant petition, and if the
Honorable Court, after notice and hearing, finds justification pursuant to Section 15 Republic
Act No. 26 to grant the same, the owners duplicate of Transfer Certificate of Title No. (N.A.)

xxxx
At the hearing, no one appeared to oppose the petition.

24

may be used as a source of the desired reconstitution pursuant to Section 3 (a) of Republic
Act No. 26, Provided, however, that in case the petition is granted, the reconstituted title
should be made subject to such encumbrances asmay be subsisting, and provided, further
that no certificate of title covering the same parcel of land exists in the Office of the Register
of Deeds concerned.

respondent Ricardo] claimed that they derived their title and ownership over Lot No. 39 in
representation of Felomino Basbas, an alleged [grand]son of the late Severo Basbas; that
Severo Basbas gave Lot No. 39 to Nicolas Basbas; and that Lot No. 40 was also given by
Severo Basbas to Valentin Basbas. Such a claim has no basis at all. The [petitioners]
evidence, specifically the Friar Lands Certificate x x x and the Certification from the DENR x x
x show that Valentin Basbas acquired Lot No. 40 of the Santa RosaDetached Estate by
purchase from the government way back on April 1, 1913, contrary to the allegations of the
defendants [including herein respondent Ricardo] that the same was given by Severo Basbas
to Valentin Basba as the latters share in the inheritance.

xxxx
WHEREFORE, finding the petition to be in order and meritorious and there being no objection
on the part of the Land Registration Commission (now NLTDRA) as to the technical
description of Lot No. 39, the same is hereby GRANTED. The Court hereby orders the
Register of Deeds of Laguna, Calamba Branch toreconstitute the original copy of TCT No.
(N.A.) in the name of the heirs of Severo Basbas who appear in the aforesaid Transfer
Certificate of Title at the time the original was lost and/or destroyed as the registered owners,
using as basis the technical description of Lot 39, certified by the Bureau of Lands, and
thereafter to annotate on the corresponding title the full technical description of Lot No. 39 of
the Sta. Rosa Detached Estate. For this purpose, the Clerk of Court is directed to forward to
the Registry of Deeds of Laguna, Calamba Branch, a certified copy of the Report of the
Acting Administrator,Land Registration Authority dated January 18, 1989, the copy of the
technical description, which documents shall be used by the Register of Deeds as bases for
reconstitution and inscription.16

Claiming to be the only heirs of Felomino Basbas (their father), and that Felomino Basbas
and Melencio Casubha are the only heirs of the late Severo Basbas, Crispiniano Basbas and
Ricardo Basbas executed an Extra-Judicial Settlement of Estate of Deceased Severo Basbas
on November 12, 1993, whereby they adjudicated to themselves Lot No. 39 of the Santa
Rosa Detached Estate x x x. On the basis of the said ExtraJudicial Settlement, Crispiniano
Basbas filed a Petition For The Reconstitution of Title No. (N.A.) covering Lot No. 39 of the
Santa Rosa Detached Estate x x x before the Regional Trial Court of Bian, Laguna, and
after hearing, an Order was issued granting the aforesaid petition. Subsequently thereafter,
TCT No. RT-1684 (N.A.) in the names of the Heirs of Severo Basbas was cancelled and a
new title (TCT No. 294295) was issued in the names of Crispiniano Basbas and Ricardo
Basbas, defendants [therein.]

2. Extra-Judicial Settlement of Estate of Severo executed by Crispiniano and respondent


Ricardo:

Based on the evidence on hand, defendants [including herein respondent Ricardo] acquired
the property in question through fraud and, therefore, an implied trust was created in favor of
[petitioners] under Article 1456 of the New Civil Code, which provides, thus:

EXTRA-JUDICIAL SETTLEMENT OF ESTATE OF DECEASED SEVERO BASBAS


xxxx

If 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.

That FELOMINO BASBAS is our father and likewise died intestate last October 30, 1976
leaving no will or debts and the share of MELENCIO CASUBHA was sold and bought by us
last 5 December 1977, xerox copy of such Deed is heretoattached as Annex "A" and made
an integral part of this Extra-Judicial Settlement of Estate of Deceased SEVERO BASBAS;

What right or rights, therefore, do they have under these circumstances? Since a constructive
trust was created, [petitioners] have the right to recover the property subject of this action.
The fact that the decision of the RTC, Bian, Lagunaapproving/granting the petition for the
reconstitution of the title covering Lot No. 39 and said decision has obtained its finality, is of
no moment. It has been held: "the rule that registration of real property under the Torrens
System has the effect of constructive notice to the whole world cannot be availed of when the
purpose of the action is to compela trustee to convey the property registered in his name for
the benefit of the cestui que trust. In other words, the defense of prescription cannotbe set up
in an action to enforce a trust x x x.

That there is no pending testate or intestate proceedings against said estate;


That in view thereof the aforenamed CRISPINIANO and RICARDO both surnamed BASBAS
do hereby adjudicate unto themselves the aforedescribed parcel of land subject to the
provisions of Sec. 4, Rule 74 of the Rules of Court as follows:
CRISPINIANO
BASBAS
RICARDO BASBAS undivided share;17

undivided

share

and

Ultimately, we agree with the disquisition of the trial courts in annulling TCT No. 294295 and
ordering the reconveyance of Lot No. 39 to petitioners:

The fact that the subject lot was already registered in the defendants [including herein
respondent Ricardo] name and indeed a Tax Declaration was issued in their favorfor taxation
purposes, and they have paid the taxes due thereon, are not conclusive evidence of
ownership. Hence, it has been held:

x x x [We proceed to] the next issue as to "whether or not the Extrajudicial Settlement of
Estate ofDeceased Severo Basbas executed by Crispiniano and Ricardo Basbas is valid."
The Court believes otherwise. Simply because the defendants [including herein respondent
Ricardo] are not the legal heirs of the late SeveroBasbas. They (defendants) [including herein

25

When a person obtains a certificate of title to a land belonging to another and he has full
knowledge of the rights of a true owner, he is considered guilty of fraud, and he may be
compelled to transfer the land to the defrauded owner so long as the property has not passed
to the hands of an innocent purchaser for value x x x. Also it has been held "that an original
owner of registered land may seek annulment of the transfer thereof on the ground of fraud
and the proper remedy is reconveyance x x x.18
We add that Valentins rights to the succession vested from the moment of death of the
decedent Severo.19 In turn, petitioners, as Heirs of Valentin, who is an uncontested heirof
decedent Severo, rights to the succession vested from the moment of Valentins death. As
such, they own Lot No. 39, undisputedly titled in Severos name and forming part of Severos
estate, and are entitled to the titling thereof in their names.
In this regard, we note that the Court of Appeals did not reverse the trials courts factual
finding on Cripinianos and Ricardos fraudulent titling of Lot No. 39 in their names. The
evidence presented by Crispiniano and Ricardo highlight the fraudulence of their claim:
1. Title to Lot No. 39 is not in their names, neither is it titled in the name of their predecessorsin-interest, Nicolas and Felomino Basbas;
2. Crispiniano and Ricardo are not the only heirs of Severo, if they are even heirs to begin
with.
One final note. Severo, as well as Valentin, have been long dead. It is well-nigh that title to
the subject property, Lot No. 39 of the Santa Rosa Detached Estate, appear in the names of
the petitioners, Heirs of Valentin, herein declared heirs of Severo, or their successors-ininterest, to finally settle title thereto and prevent occurrences of fraudulent titling thereof.
Hence, petitioners, Heirs of Valentin and their successors-in-interest, are directed to take the
appropriate action for titling of the subject property.
WHEREFORE, the petition is GRANTED. The Decision of the Court of Appeals in CA-G.R.
SP No. 99853 is REVERSED. The Decision of the Regional Trial Court and the Municipal
Trial Court are AFFIRMED. Petitioners, Heirs of Valentin Basbas and their successors-ininterest, are likewise DIRECTEDto take the appropriate action for titling of Lot No. 39 of
Santa Rosa Detached Estate with dispatch, and NOTIFY this Court within ten (10) days of
such action.
SO ORDERED.

26

with an area of 1,020 square meters under Tax Declaration No. A-016-01003; and (3) Lot
Nos. 5, 6 & 7, Block 2 covered by Tax Declaration No. A-01700723 (subject properties).
After the death of Marcelo Sr. in 1955, Teofista and herein respondents, as well as Elpidio
Suarez,7executed an Extrajudicial Settlement of Estate, 8 partitioning Marcelo Sr.'s estate,
thus:
WHEREAS, the said deceased is survived by the parties hereto who are his only legal heirs:
TEOFISTA ISAGON, being the surviving spouse, and EUFROCINA S. ANDRES, ELPIDIO
SUAREZ, DANILO SUAREZ, EVELYN SUAREZ, MARCELO SUAREZ, JR. and REGGINEO
SUAREZ, being the legitimate children of the deceased with the said TEOFISTA ISAGON;
WHEREAS, the minors ELPIDIO, SUAREZ, DANILO SUAREZ, EVELYN SUAREZ,
MARCELO SUAREZ, JR. and REGGINEO SUAREZ are represented herein by EUFROCINA
S. ANDRES, in her capacity as the guardian and legal administrator of the property of the
said minors;
WHEREAS, there are no known debts or financial obligations of whatever nature and amount
against the estate of the deceased;
NOW, THEREFORE, in consideration of the foregoing premises, the Parties have agreed to
settle and liquidate the assets of the conjugal partnership between the deceased and
TEOFISTA ISAGON, and to settle and adjudicate the estate of the said deceased, by and
pursuance to these presents, in the following manner, to wit:
1. That TEOFISTA ISAGON, as the surviving spouse and partner of the deceased, shall
receive in absolute and exclusive ownership the following properties as her lawful share in
the assets of the conjugal partnership of gains between her and the deceased, to wit:
G.R. No. 149017

November 28, 2008

(a) Half (1/2) interest and participation in the parcel of land covered by Tax Declaration No.
6938, situated at Sitio Pantayan, Municipality of Taytay, Province of Rizal;

VALENTE
RAYMUNDO,petitioner,
vs.
TEOFISTA ISAGON VDA. DE SUAREZ, DANILO I. SUAREZ, EUFROCINA SUAREZ,
MARCELO I. SUAREZ, JR, EVELYN SUAREZ, ET AL., respondents.

(b) Half (1/2) interest and participation in the parcel of land covered by Tax Declaration No.
6939, situated at Sitio Pantayan, Municipality of Taytay, Province of Rizal;
(c) Half (1/2) interest and participation in the parcel of land covered by TCT No. 38291,
situated at Barrio Rosario, Municipality of Pasig, Province of Rizal;

DECISION
NACHURA, J.:

(d) Half (1/2) interest and participation in the parcel of land covered by TCT No. 38290,
situated at Barrio Rosario, Municipality of Pasig, Province of Rizal;

This petition, filed under Rule 65 of the Rules of Court, assails the Court of Appeals (CA)
Decision1and Resolution2 in CA-G.R. SP No. 58090 which reversed, set aside and recalled
the Regional Trial Court (RTC) Orders3 in Civil Case No. 51203.

(e) TWELVE THOUSAND FIVE HUNDRED THIRTY PESOS AND NINETY (P12,530.90)
deposited with the Commercial Bank and Trust Company of the Philippines, and THIRTYNINE PESOS (P39.00) deposited with Prudential Bank.

First, the long settled facts.

2. That the Parties TEOFISTA ISAGON, EUFROCINA S. ANDRES, ELPIDIO SUAREZ,


DANILO SUAREZ, EVELYN SUAREZ, MARCELO SUAREZ, JR. and REGGINEO SUAREZ,
shall each and all receive and be entitled to a share equivalent to one-seventh (1/7) of the
estate of the deceased MARCELO SUAREZ, which estate is comprised of the following
properties, to wit:

Marcelo and Teofista Isagon Suarez'4 marriage was blessed with both material wealth and
progeny in herein respondents, namely, Danilo, 5 Eufrocina, Marcelo Jr., Evelyn, and
Reggineo,6 all surnamed Suarez. During their marriage, governed by the conjugal partnership
of gains regime, they acquired numerous properties, which included the following: (1) a parcel
of land situated in Barrio Caniogan, Pasig with an area of 348 square meters covered by
Transfer Certificate of Title (TCT) No. 30680; (2) property located in Pinagbuhatan, Pasig,

27

(a) A parcel of land covered by TCT No. 30680, situated at Barrio Kaniogan, Municipality of
Pasig, Province of Rizal, with an assessed value of P4,150.00.

When the judgment of the CFI became final and executory, herein subject properties were
levied and sold on execution on June 24, 1983 to satisfy the judgment against Teofista and
Rizal Realty. The aforementioned plaintiffs were the highest bidder, and bought the levied
properties for the amount ofP94,170.00. As a result, a certificate of sale was issued to them
and registered in their favor on August 1, 1983. On July 31, 1984, the Provincial Sheriff of
Rizal issued a final deed of sale over the subject properties.

(b) Three (3) parcels of land covered by TCT Nos. 33982, 33983 and 33984, situated at
Barrio Pineda, Municipality of Pasig, Province of Rizal, with an assessed value ofP560.00.
(c) A parcel of land covered by TCT 33986, situated at Barrio Pineda, Municipality of Pasig,
Province of Rizal, with an assessed value of P440.00.

Parenthetically, before expiration of the redemption period, or on June 21, 1984, herein
respondents filed a revindicatory action against petitioner Valente, Violeta, Virginia and Maria
Concepcion, docketed as Civil Case No. 51203, for the annulment of the auction sale and
recovery of ownership of the levied properties. Essentially, respondents alleged in their
complaint that they cannot be held liable for the judgment rendered against their mother,
Teofista, not having been impleaded therein; and consequently, the subject properties, which
they own pro indiviso with their mother, can neither be levied nor be sold on execution.

(d) Two (2) parcels of land, being Lots Nos. 42 and 44 of the amendment-subdivision plan TY4653-Amd., being a portion of Lot 2 described on the original plan II-4653, G.L.R.O. Record
No. _____, situated at Barrio Santolan, Municipality of Pasig, Province of Rizal, with a total
assessed value of P590.00.
(e) Two parcels of land, being Lots Nos. 43 and 45 of the amendment-subdivision plan TY4653-Amd., being a portion of Lot 2 described on the original plan II-4653, G.L.R.O. Record
No. _______, situated at Barrio Santolan, Municipality of Pasig, Province of Rizal, with a total
assessed value of P1,190.00.

Meanwhile, the RTC, Branch 151, formerly the CFI, Branch 1, in Civil Case Nos. 21376 to
21379, issued an Order10 directing Teofista: (1) to vacate the subject properties, (2) to desist
from despoiling, dismantling, removing or alienating the improvements thereon, (3) to place
petitioner Valente, Violeta, Virginia and Maria Concepcion in peaceful possession thereof,
and (4) to surrender to them the owner's duplicate copy of the torrens title and other pertinent
documents. Herein respondents, joined by their mother, Teofista, filed a Motion for
Reconsideration arguing that the subject properties are co-owned by them and further
informing the RTC of the filing and pendency of Civil Case No. 51203. Nonetheless, the trial
court denied Teofista's and herein respondents' motion, reiterated its previous order, which
included, among others, the order for Teofista and all persons claiming right under her, to
vacate the lots subject of the judicial sale.

(f) A parcel of land, being Lot No. 6, Block 269 of the subdivision plan pos-112, being a
portion of Lot 2, Block 348, Psd-3188, G.L.R.O. Record Nos. 375,699 and 917, situated at
San Felipe Neri, Province of Rizal, with an assessed value of P6,340.00.
(g) A parcel of land covered by OCT No. 391, situated in the Municipality of Taytay, Province
of Rizal, with an assessed value of P1,840.00.
(h) TWELVE THOUSAND (12,000) shares of stock of the Consolidated Mines, Inc.
represented by Certificate No. 71-5-B (for 1,000 shares) and Certificate No. 12736 (for 11,000
shares).
PROVIDED, that their title to the properties hereinabove mentioned shall be in common and
the share of each heir being pro indiviso.

Undaunted, Teofista and herein respondents filed a petition for certiorari before the CA to
annul the foregoing orders. The appellate court, on July 6, 1987, dismissed Teofista's and
herein respondents' petition, thus:

Curiously, despite the partition, title to the foregoing properties, explicitly identified in the
Extrajudicial Settlement of Estate as forming part of Marcelo's and Isagon's property regime,
remained in the couple's name. Not surprisingly, Teofista continued to administer and manage
these properties. On the whole, apart from those now owned exclusively by Teofista, all the
properties were held pro indiviso by Teofista and her children; and respective titles thereto
were not changed, with Teofista asde facto administrator thereof.

We believe this petition cannot prosper for two reasons. First, as purported case
for certiorari it fails to show how the respondent judge had acted without or in excess of
jurisdiction or with grave abuse of discretion. The two orders being assailed were preceded
by a final judgment, a corresponding writ of execution, a levy on execution and a judicial sale,
all of which enjoy a strong sense presumption of regularity.

In 1975, Rizal Realty Corporation (Rizal Realty) and Teofista, the latter owning ninety percent
(90%) of the former's shares of stock, were sued by petitioner Valente Raymundo, his wife
Violeta, Virginia Banta and Maria Concepcion Vito (plaintiffs) in consolidated cases for
Rescission of Contract and Damages, docketed as Civil Case Nos. 21736 to 21739.
Thereafter, in 1975, the then Court of First Instance (CFI) of Rizal, Branch 1, rendered
judgment: (1) rescinding the respective contracts of plaintiffs with Rizal Realty and Teofista,
and (2) holding the two defendants solidarily liable to plaintiffs for damages in the aggregate
principal amount of about P70,000.00.9

Secondly, as far as [petitioner] Teofista Suarez is concerned, she cannot complain about the
levy because she was a party in the consolidated cases where judgment was rendered
against her in her personal capacity. Since she did not appeal from the decision, she cannot
say that the judgment is erroneous for an obligation that belong to the corporation. And with
respect to the children of Teofista Suarez, who are co-petitioners in this proceedings [herein
respondents], suffice it to point out that not being parties in the consolidated cases, what they
should have done was to immediately file a third party claim. The moment levy was made on
the parcels of land, which they claim are theirs by virtue of hereditary succession, they should

28

have seasonably filed such claim to protect their rights. As the record discloses, however, the
children chose to remain silent, and even allowed the auction sale to be held, filing almost a
year later a half-hearted complaint to annul the proceedings which they allowed to be
dismissed by not diligently prosecuting it.

From this ruling, herein respondents appealed to the Supreme Court. In Suarez v. Court of
Appeals,13we reversed the appellate court, thus:
Even without touching on the incidents and issues raised by both petitioner [herein
respondents] and private respondents [petitioner Valente, Violeta, Virginia and Maria
Concepcion] and the developments subsequent to the filing of the complaint, [w]e cannot but
notice the glaring error committed by the trial court.

In Santos v. Mojica (10 SCRA 318), a partition case with third- party claimants, the Supreme
Court came out with the following ruling: "The procedure (a petition for certiorari) followed by
him (a petitioner not party to the original partition case) in vindicating his right is not the one
sanctioned by law, for he should have filed a separate and independent action making parties
therein the sheriff and the plaintiffs responsible for the execution xxx. It can, therefore, be
said that (he) acted improperly in filing the present petition because his remedy was to file a
separate and independent action to vindicate his ownership over the land.

It would be useless to discuss the procedural issue on the validity of the execution and the
manner of publicly selling en masse the subject properties for auction. To start with, only onehalf of the 5 parcels of land [subject properties] should have been the subject of the auction
sale.
The law in point is Article 777 of the Civil Code, the law applicable at the time of the institution
of the case:

WHEREFORE, the petition is denied and the restraining order previously issued is
DISSOLVED, with costs against petitioners.11

The rights to the succession are transmitted from the moment of the death of the decedent."

On the other litigation front concerning Civil Case No. 51203, a writ of preliminary injunction
was issued by the RTC Pasig, Branch 155, on February 25, 1985, enjoining petitioner
Valente, Violeta, Virginia and Maria Concepcion from transferring to third parties the levied
properties based on its preliminary finding that the auctioned properties are co-owned by
Teofista and herein respondents. Subsequently, however, Civil Case No. 51203 was
dismissed by the RTC, Branch 155, at the instance of petitioner Valente for failure of herein
respondents to prosecute. But in yet another turn of events, the RTC, Branch 155, lifted its
previous order of dismissal and directed the issuance of alias summons.

Article 888 further provides:


"The legitime of the legitimate children and descendants consists of one-half of the hereditary
estate of the father and of the mother.
The latter may freely dispose of the remaining half, subject to the rights of illegitimate children
and of the surviving spouse as hereinafter provided."
Article 892, par. 2 likewise provides:
"If there are two or more legitimate children or descendants, the surviving spouse shall be
entitled to a portion equal to the legitime of each of the legitimate children or descendants."

Thus, it was now petitioner Valente's, Violeta's, Virginia's and Maria Concepcion's turn to file
a petition for certiorari with the CA, assailing the various orders of the RTC, Branch 155,
which all rejected their bid to dismiss Civil Case No. 51203. The CA granted their petition,
thus:

Thus, from the foregoing, the legitime of the surviving spouse is equal to the legitime of each
child.
The proprietary interest of petitioners [herein respondents] in the levied and auctioned
property is different from and adverse to that of their mother [Teofista]. Petitioners [herein
respondents] became co-owners of the property not because of their mother [Teofista] but
through their own right as children of their deceased father [Marcelo Sr.]. Therefore,
petitioners [herein respondents] are not barred in any way from instituting the action to annul
the auction sale to protect their own interest.

And the fact that herein private respondents, as the legal heirs of Teofista Vda. de Suarez
and supposedly not parties in Civil Case Nos. 21376 - 21379 does not preclude the
application of the doctrine of res judicata since, apart from the requisites constitutive of this
procedural tenet, they were admittedly the children of Teofista Suarez, who is the real partyin-interest in the previous final judgment. As successors-in-interest of Teofista Suarez, private
respondents merely stepped into the shoes of their mother in regard to the levied pieces of
property. Verily, there is identity of parties, not only where the parties in both actions are the
same, but where there is privity with them as in the cases of successors-in-interest by title
subsequent to the commencement of the action or where there is substantial identity.

WHEREFORE, the decision of the Court of Appeals dated July 27, 1990 as well as its
Resolution of August 28, 1990 are hereby REVERSED and set aside; and Civil Case No.
51203 is reinstated only to determine that portion which belongs to petitioners and to annul
the sale with regard to said portion.

Finally, the action to annul the judicial sale filed by herein private respondents is not the
reinvindicatory suit, much less the third party claim contemplated by Section 17 of Rule 39.

It was at this point when another series of events transpired, culminating in the present
petition.

WHEREFORE, the petition for certiorari is hereby granted and the questioned orders dated
February 25, 1985, May 19, 1989 and February 26, 1990 issued in Civil Case No. 51203 are
hereby annulled; further respondent judge is ordered to dismiss Civil Case No. 51203. 12

Upon our reinstatement of Civil Case No. 51203, each and every pleading filed by herein
respondents, as plaintiffs therein, was hotly contested and opposed by therein defendants,
including petitioner Valente. Moreover, even at that stage, when the case had been remanded

29

with a directive to "determine that portion which belongs to [herein respondents] and to annul
the sale with regard to said portion," Civil Case No. 51203 had to be re-raffled and
transferred, for varied reasons, to the different court branches in Pasig City. In between all
these, petitioner Valente, along with the other defendants, repeatedly filed a Motion to
Dismiss Civil Case No. 51203 for the purported failure of herein respondents to prosecute the
case. Most of these Motions to Dismiss were denied.

13. That the undersigned now concludes that the first volume of the above-entitled case was
probably lost during the renovation of the Justice Hall Building, and will have to be
reconstituted with the use of documents in the possession of the parties, or documents
entered as exhibits in other Courts.14
In this regard, herein respondents filed a Motion for Reconstitution of Records 15 of the case.
Initially, petitioner Valente, and the other defendants -- Violeta, Virginia and Maria Concepcion
-- opposed the motion.16 However, the trial court eventually granted the motion for
reconstitution, and ordered petitioner Valente and the other defendants to submit a copy of
their Answer filed thereat and copies of other pleadings pertinent to the case. 17

With each transfer of Civil Case No. 51203, the judge to which the case was raffled had to
study the records anew. Expectedly, part of the records went missing and were lost. On April
12, 1993, the Clerk of Court of RTC, Branch 71, to which Civil Case No. 51203 was
remanded, filed a report on the records of the case, to wit:

Thereafter, three (3) incidents, among numerous others, set off by the parties' pleadings, are
worth mentioning, to wit:

1. The first volume of the record in the above-entitled case was recorded as received on June
20, 1990, by Sheriff Alejandro O. Loquinario;

1. A Motion for Leave to File and Admit Supplemental Complaint 18 filed by herein
respondents. The Supplemental Complaint additionally prayed that the levy and sale at public
auction of the subject properties be annulled and set aside, as the bid price was
unconscionable and grossly inadequate to the current value of the subject properties. The
Supplemental Complaint further sought a re-bidding with respect to Teofista's share in the
subject properties. Finally, it prayed that TCT No. 6509 in the name of petitioner Valente,
Violeta, Virginia and Maria Concepcion be cancelled and TCT No. 30680 in the name of
Marcelo Suarez, married to Teofista Isagon, be reinstated.

2. That the staff of Branch 71 at this time was sharing a small room with Branch 161 at the
First Floor of the Justice Hall, and as the Branch was newly formed, it had no equipment or
furniture of its own, and was still undermanned;
3. That sometime in August 1990, Branch 71 moved to the staffroom of Branch 159 at the
Second Floor of the Justice Hall;
4. That on October 25, 1990, this Court received a Notice of Judgment dated October 22,
1990 from the Court of Appeals that ruled the dismissal of the above-entitled case, and as per
standing instructions of Judge Graduacion A. Reyes-Claravall, the same was bound as
volume 2 of the case;

2. A Manifestation and Motion (to Execute/Enforce Decision dated September 4, 1992 of the
Supreme Court)19 filed by herein respondents pointing out that the Supreme Court itself had
noted the current increased value of the subject properties and that petitioner Valente,
Violeta, Virginia and Maria Concepcion unjustly enriched themselves in appropriating the
subject properties worth millions then, for a measly bid price of P94,170.00, for a judgment
obligation worth only P70,000.00.

5. That just before the Christmas vacation in 1991, the branch was forced to hastily move all
of its records and equipment to branch 69, because of the unexpected notice we received
that the room we were occupying was to be demolished in order to meet the schedule for the
renovation of the building;

3. An Urgent Motion [to direct compliance by plaintiffs (herein respondents) with Supreme
Court Decision or to consider the matter submitted without evidence on the part of
plaintiffs]20 filed by therein defendants, including herein petitioner Valente, pointing out that
plaintiffs (herein respondents) have yet to comply with the RTC, Branch 67 Order
commanding them to submit (to the RTC) any evidence showing settlement of the estate of
the deceased Marcelo Suarez, in order for the court to determine the portion in the estate
which belongs to Teofista. The Urgent Motion stated in paragraph 2, thus:

6. That unfortunately, the room was demolished before the undersigned could make a last
check to see if everything was transferred;
7. That it was only later on that this office discovered that important documents were indeed
lost, including transcripts of stenographic notes in a case that was submitted for decision;
8. That sometime in May 1992, the branch moved its Office to its present location;
9. That on March 8, 1993, this Court received a copy of a Decision of the Supreme Court
reversing the earlier ruling of the Court of Appeals;

2. The defendants [including herein petitioner Valente] did everything possible to expedite the
disposition of this case while the plaintiffs [herein respondents] did everything possible to
DELAY the disposition of the same obviously because the plaintiffs [herein respondents] are
in full possession and enjoyment of the property in dispute. In its decision of September 4,
1992, the SUPREME COURT nullified TWO final and executory DECISIONS of the Court of
Appeals in an unprecedented action. In said decision, the Supreme Court ordered the
plaintiffs [herein respondents] to establish with evidence their personality as heirs of Marcelo
Suarez, and after being able to do so, to adduce evidence that would determine what portion

10. That it was at this time that the first volume of this case, which was bundled along with
other cases which were decided and/or archived, was reported as missing;
11. That from the time the same was found to be missing, Judge Claravall ordered that a
search for the same be made in all of the offices wherein this branch was forced to share a
room with, as well as the Court of Appeals, in the event that the same was transmitted to said
Court;
12. That all the efforts were in vain, as said record could not be located anywhere;

30

belongs to plaintiffs hence the above matters need be litigated upon before the RTC can
"annul the sale with regard to said portion" (belonging to the plaintiffs alleged heirs).

3. Order dated September 10, 1996, issued by Judge Santos denying the appeal interposed
by petitioner Valente from the January 22, 1996 and May 29, 1996 Orders, ruling that these
are interlocutory orders, and, therefore, not appealable. 23

On these incidents, the records reveal the following Orders issued by the different branches
of the RTC:

4. Order dated April 8, 1999, issued by Pairing Judge Santiago Estrella which declared, thus:

1. Order dated March 17, 1995, issued by Presiding Judge Rodrigo B. Lorenzo of Branch
266, Pasig City, admitting herein respondents' Supplemental Complaint. 21

Considering that counsel for the plaintiffs does not have the birth certificates of the heirs of
the plaintiff to prove their affiliation with the deceased which is one of the matters written in
the decision of the higher court which must be complied with, and in order for counsel for the
plaintiffs [herein respondents] to have the opportunity to complete all documentary evidence
and in view of abbreviating the proceedings and as prayed for, today's scheduled pre-trial is
re-set for the last time to May 19, 1999 at 8:30 a.m.

2. Order dated January 22, 1996, issued by Judge Apolinario B. Santos resolving: (a) herein
respondents' Manifestation and Motion (to execute/enforce Decision dated September 4,
1992 of the Supreme Court), and (b) therein defendants' (including herein petitioner
Valente's) Request for Answer to Written Interrogatories. 22 The RTC, Branch 67, resolved the
incidents, thus:

In this connection, counsel for plaintiffs [herein respondents] is advised to secure all the
documentary evidence she needs material to this case which will expedite the disposition of
this case.24

From the foregoing uncontroverted facts, this Court is convinced beyond a shadow of doubt
that the Decision of the Supreme Court of September 4, 1992, being the final arbiter in any
judicial dispute, should be implemented for the following reasons:
On the request for Answers to Written Interrogatories filed by the defendants, it is obvious
that at this stage of the proceedings where the Supreme Court had already pronounced the
undisputed facts, which binds this court, the answer sought to be elicited through written
interrogatories, therefore, are entirely irrelevant, aside from having been filed way out of time.

This last Order and therein defendants' Urgent Motion spawned another contentious issue
between the parties. In this connection, Judge Estrella issued an Order 25 requiring the parties
to file their respective position papers due to the "divergent views on the nature of the hearing
that should be conducted in compliance with" our decision in Suarez. Both parties duly filed
their position papers, with herein respondents attaching thereto a copy of the Extrajudicial
Settlement of Estate executed by the heirs of Marcelo Suarez in 1957.

WHEREFORE, premises considered, this court, implements the decision of the Supreme
Court dated September 4, 1992 which mandates that:

In resolving this latest crossfire between the parties, the RTC, Branch 67, issued an Order
dated January 11, 2000, which reads, in part:

"xxx and Civil Case No. 51203 is reinstated only to determine that portion which belongs to
petitioner and to annul the sale with regard to said portion."

This Court is of the view that the Honorable Supreme Court is not a trier of facts, precisely it
directed that the records of this case be remanded to the Regional Trial Court for further
proceedings.

xxxx

In order to enforce such mandate of the Supreme Court, this court orders that:

xxxx

a. The auction sale of the five (5) parcels of land and all prior and subsequent proceedings in
relation thereto are declared null and void.

It is a matter of record that there was no trial on the merits completed in the Regional Trial
Court. xxx The Supreme Court reversed the judgment of the Court of Appeals and ordered
the reinstatement of Civil Case No. 51203. Naturally, there was no trial on the merits before
this Court that allowed the parties to adduce evidence to establish their respective claims in
the plaintiffs' [herein respondents] complaint and in the defendants' [including petitioner
Valente] counter-claim, respectively. It is in this context that the Honorable Supreme Court
reinstated the "action [of herein respondents] to annul the auction sale to protect their [herein
respondents] own interest.

b. Transfer Certificate of Title No. 6509 in the name of defendant Valente Raymundo is also
declared null and void, and the Register of Deeds of Rizal, Pasig City, is ordered to issue a
new one in the name of the deceased Marcelo Suarez or to reinstate Transfer Certificate of
Title No. 30680 in the name of Marcelo Suarez.
c. Teofista Suarez is ordered to reimburse the amount of P94,170.00, plus legal interest from
the date of issuance of this order, and failing which, the portion of the estate of Marcelo
Suarez belonging to the surviving spouse, Teofista Suarez, may be levied on execution.

While this Court is of the view that trial on the merits is necessary for the purpose of giving
the plaintiffs [herein respondents] a chance to adduce evidence to sustain their complaint and
the defendants [including petitioner Valente] to prove their defense, consistent with the
directive of the Honorable Supreme Court (in its Decision promulgated on September 4,
1992), the Court is, however, confronted with the very recent decision of the Honorable

d. [Herein respondents], including Teofista Suarez, are hereby ordered to submit to this court
any evidence showing settlement of the estate of the deceased, Marcelo Suarez, in order for
this court to determine the portion in the estate which belongs to Teofista Suarez.
Therein defendants, including petitioner Valente, filed a Motion for Reconsideration which the
trial court denied on May 29, 1996.

31

Supreme Court in "Heirs of Guido Yaptinchay, et al. vs. Del Rosario, et al., G.R. No. 124320,
March 2, 1999" where it held that -

[Petitioner Valente, Violeta, Virginia and Maria Concepcion] filed a notice of appeal on the
order of Judge Santos. The appeal, on motion of [herein respondents] was denied on
September 10, 1996. Obviously, the decision of the Supreme Court had become final and
executory. Likewise, both orders of Judge Santos dated May 29, 1996 denying the motion for
reconsideration and the denial of the notice of appeal dated September 6, 1996 had also
become final and executory.

The declaration of heirship must be made in an administration proceeding, and not in an


independent civil action. This doctrine was reiterated in Solve vs. Court of Appeals (182
SCRA 119, 128). The trial court cannot make a declaration of heirship in the civil action for
the reason that such a declaration can only be made in a special proceeding. Under Section
3, Rule 1 of the 1997 Revised Rules of Court, a civil action is defined as "one by which a
party sues another for the enforcement or protection of a right, or the prevention or redress of
a wrong" while a special proceeding is "a remedy by which a party seeks to establish a
status, a right, or a particular fact." It is then decisively clear that the declaration of heirship
can be made only in a special proceeding inasmuch as the petitioners here are seeking the
establishment of a status or right.

The denial of petitioner Valente's Motion for Reconsideration prompted the filing of this
present petition for certiorari.
Petitioner Valente posits that the appellate court committed grave abuse of discretion in
recalling and setting aside the Orders of Judge Estrella and reinstating those of Judge Santos
because:
1. The CA ruled that the Orders dated May 29, 1996 and September 6, 1996 issued by Judge
Santos were final and executory, and yet the latter did not allow an appeal to be taken
therefrom ratiocinating that the questioned orders were interlocutory, and therefore, not
appealable; and

In as much as the leading case on the matter is that of "Heirs of Yaptinchay v. Del Rosario,
G.R. No. 124320, March 2, 1999" it is left with no choice but to obey said latter doctrine.
WHEREFORE, the foregoing premises considered, this Court holds that in the light of the
doctrine laid down in the case of "Heirs of Yaptinchay vs. Del Rosario, G.R. No. 124320,
March 2, 1999" this case is dismissed without prejudice to the plaintiffs' [herein respondents']
filing a special proceeding consistent with said latest ruling. 26

2. The CA ignored and violated the Supreme Court's ruling in Heirs of Yaptinchay v. Del
Rosario28 which held that a declaration of heirship must be made in a special proceeding and
not in a civil action.

Herein respondents moved for reconsideration thereof which, however, was denied by the
RTC, Branch 67 on March 14, 2000.27

We find the petition bereft of merit.


At the outset, we note that petitioner Valente incorrectly filed a petition for certiorari to appeal
the CA decision. Petitioner should have filed a petition for review on certiorari under Rule 45
of the Rules of Court. Simply imputing in a petition that the decision sought to be reviewed is
tainted with grave abuse of discretion does not magically transform a petition into a special
civil action for certiorari. The CA decision disposed of the merits of a special civil action, an
original petition, filed thereat by herein respondents. That disposition is a final and executory
order, appealable to, and may be questioned before, this Court by persons aggrieved thereby,
such as petitioner Valente, via Rule 45.

Consequently, herein respondents filed a petition for certiorari before the CA alleging grave
abuse of discretion in the trial court's order dismissing Civil Case No. 51203 without
prejudice. All the defendants in the trial court were impleaded as private respondents in the
petition. Yet, curiously, only petitioner Valente filed a Comment thereto. The appellate court
granted the petition, recalled and set aside RTC, Branch 67's Orders dated January 11, 2000
and March 14, 2000, and reinstated Judge Santos' Orders dated May 29, 1996 and
September 6, 1996. It disposed of the petition, thus:
We agree with [herein respondents].

On this score alone, the petition should have been dismissed outright. However, we have
disregarded this procedural flaw and now resolve this case based on the merits or lack
thereof.

On September 4, 1992, the Supreme Court (G.R. No. 94918) reversed the decision of the
Court of Appeals and mandates that Civil Case No. 51203 be reinstated in order to determine
the portion in the estate which belongs to Teofista Suarez. The sale of the parcels of land was
declared null and void. Necessarily, the title (TCT No. 5809) in the name of respondents was
also declared null and void. xxx

Petitioner asseverates that the assailed CA ruling "is unfair and it amounts to a trickery to
prevent an appeal against a final order by claiming that the appealed order is merely
interlocutory and later maintain that the same order has become final after declaring it to be
interlocutory."

xxxx
Hon. Apolinario Santos of Br. 67, Regional Trial Court, Pasig City, on January 22, 1996 and
on motion of [herein respondents], issued an order to execute/enforce the decision of the
Supreme Court xxx.

We reject petitioner's paltry contention. Petitioner apparently does not comprehend the
distinction between an interlocutory order which is final and executory, and a final order which
disposes of the controversy or case; much less, understand the available remedies
therefrom.

xxxx

32

We have defined an interlocutory order as referring to something between the


commencement and the end of the suit which decides some point or matter but it is not the
final decision on the whole controversy.29 It does not terminate or finally dismiss or finally
dispose of the case, but leaves something to be done by the court before the case is finally
decided on the merits.30 Upon the other hand, a final order is one which leaves to the court
nothing more to do to resolve the case.31

Clearly, the denial of therein defendants' (including petitioner Valente's) appeal from the
Orders dated May 29, 1996 and September 6, 1996 was in order. Thus, the CA decision
affirming the RTC's denial was correct.
Further, on this crucial distinction as applied to this case, petitioner Valente filed a petition
forcertiorari from the CA decision in CA-G.R. SP No. 58090, which is not an interlocutory
order. It is a final order which completely disposed of the merits of the case with nothing more
left to be done therein. The correct and available remedy available to petitioner Valente was,
as previously discussed, a petition for review on certiorari under Rule 45 of the Rules of
Court.

On more than one occasion, we laid down the test to ascertain whether an order is
interlocutory or final i.e., "Does it leave something to be done in the trial court with respect to
the merits of the case?" If it does, it is interlocutory; if it does not, it is final. The key test to
what is interlocutory is when there is something more to be done on the merits of the
case.32 The Orders dated May 29, 1996 and September 6, 1996 issued by Judge Santos are
interlocutory, and therefore, not appealable, as they leave something more to be done on the
merits of the case. In fact, in paragraph (d) of Judge Santos' Order dated May 29, 1996,
herein respondents were directed to submit evidence showing settlement of the estate of the
deceased Marcelo Sr.

In fine, petitioner Valente erroneously sought relief through reversed remedies. He tried to
appeal the interlocutory orders of the RTC which are unappealable. Thus, the RTC properly
denied his Notice of Appeal, and the CA correctly upheld the RTC. He should have filed a
petition for certiorari; under Rule 65. On the other hand, from the final order of the CA, he
comes before this Court on a petition for certiorari under Rule 65, when the proper remedy is
an appeal by certiorari under Rule 45.

Contrary to petitioner Valente's stance, there is no trickery or chicanery in the CA's distinction
between an interlocutory and a final order. Indeed, as ruled by the CA, the RTC Order
denying petitioner Valente's Notice of Appeal attained finality when he failed to file a petition
for certiorariunder Rule 65 of the Rules of Court.

In the recent case of Jan-Dec Construction Corporation v. Court of Appeals 33 we ruled in this
wise:

We cannot overemphasize the rule that the correct identification of the nature of an assailed
order determines the remedies available to an aggrieved party. The old Rules of Court in
Section 2, Rule 41 reads, thus:

Under Rule 45, decisions, final orders or resolutions of the CA in any case, i.e., regardless of
the nature of the action or proceedings involved, may be appealed to the Court by filing a
petition for review, which would be but a continuation of the appellate process over the
original case. It seeks to correct errors of judgment committed by the court, tribunal, or officer.
In contrast, a special civil action for certiorari under Rule 65 is an independent action based
on the specific grounds therein provided and proper only if there is no appeal or any plain,
speedy and adequate remedy in the ordinary course of law. It is an extraordinary process for
the correction of errors of jurisdiction and cannot be availed of as a substitute for the lost
remedy of an ordinary appeal.

As a rule, the remedy from a judgment or final order of the CA is appeal via petition for review
under Rule 45 of the Rules.

SEC. 2. Judgments or orders subject to appeal.-Only final judgments or orders shall be


subject to appeal. No interlocutory or incidental judgment or order shall stay the progress of
an action, nor shall it be the subject of appeal until final judgment or order is rendered for one
party or the other.
xxxx
With the advent of the 1997 Rules of Civil Procedure, Section 1, Rule 41 now provides for the
appropriate remedy to be taken from an interlocutory order, thus:

Independently of this procedural infirmity, even on the merits of the case, the petition does not
fare otherwise. It must be dismissed for lack of merit.

SECTION 1. Subject of appeal. - An appeal may be taken from a judgment or final order that
completely disposes of the case, or of a particular matter therein when declared by these
Rules to be appealable.
xxx

Petitioner Valente insists that, following our ruling in Heirs of Yaptinchay v. Del
Rosario,34 herein respondents must first be declared heirs of Marcelo Sr. before they can file
an action to annul the judicial sale of what is, undisputedly, conjugal property of Teofista and
Marcelo Sr.

(c) An interlocutory order;

We disagree. Our ruling in Heirs of Yaptinchay is not applicable.

xxx

Herein respondents' status as legitimate children of Marcelo Sr. and Teofista and thus,
Marcelo Sr.'s heirs has been firmly established, and confirmed by this Court in Suarez v.
Court of Appeals.35 True, this Court is not a trier of facts, 36 but as the final arbiter of
disputes,37 we found and so ruled that herein respondents are children, and heirs of their

No appeal may be taken from:

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

33

deceased father, Marcelo Sr. This having been settled, it should no longer have been a
litigated issue when we ordered a remand to the lower court. In short, petitioner Valente's,
Violeta's, Virginia's, and Maria Concepcion's representation in the RTC that our ruling in
Suarez required herein respondents to present evidence of their affiliation with the deceased,
Marcelo Sr., is wrong.

Art. 263. The action to impugn the legitimacy of the child shall be brought within one year
from the recording of birth in the Civil Register, if the husband should be in the same place, or
in a proper case, any of his heirs.
If he or his heirs are absent, the period shall be eighteen months if they should reside in the
Philippines; and two years if abroad. If the birth of the child has been concealed, the term
shall be counted from the discovery of the fraud.

As was set forth in the dispositive portion of Suarez, "Civil Case No. 51203 is reinstated only
to determine that portion which belongs to [herein respondents] and to annul the sale with
regard to said portion." There is clearly no intimation in our decision for the RTC to have to
determine an already settled issue i.e., herein respondents' status as heirs of Marcelo Sr.

Art. 265. The filiation of legitimate children is proved by the record of birth appearing in the
Civil Register, or by an authentic document or a final judgment.
Art. 266. In the absence of the titles indicated in the preceding article, the filiation shall be
proved by the continuous possession of status of a legitimate child.

Moreover, petitioner Valente cannot assail, directly or indirectly, the status of herein
respondents as legitimate children of Marcelo Sr. and Teofista, and likewise demand that
herein respondents first prove their filiation to Marcelo Sr. The following records bear out
Marcelo, Sr.'s and Teofista's paternity of herein respondents, and the latter's status as
legitimate children:

In Heirs of Yaptinchay, the complaint for annulment and/or declaration of nullity of certain
TCT's was dismissed for failure of the petitioners to demonstrate "any proof or even a
semblance of it" that they had been declared the legal heirs of the deceased couple, the
spouses Yaptinchay. In stark contrast, the records of this case reveal a document, an
Extrajudicial Settlement of Marcelo Sr.'s estate, which explicitly recognizes herein
respondents as Marcelo Sr.'s legitimate children and heirs. The same document settles and
partitions the estate of Marcelo Sr. specifying Teofista's paraphernal properties, and
separates the properties she owns in common with her children, herein respondents. Plainly,
there is no need to re-declare herein respondents as heirs of Marcelo Sr., and prolong this
case interminably.

1. The CA decision in CA-G.R. SP Nos. 10646 to 10649 where Teofista, along with herein
respondents, questioned the RTC, Branch 151's Orders dated October 10, 1984 and October
14, 1986. Although the CA ruled against Teofista and herein respondents, it explicitly
recognized the latter's status as legitimate children of Teofista and Marcelo Sr.; and 38
2. The CA decision in CA-G.R. SP No. 20320 which incorrectly ruled that herein respondents
were, as children of Teofista, merely successors-in-interest of the latter to the property and by
virtue thereof, bound by the judgment in Civil Case Nos. 21376 to 21379 consistent with the
doctrine of res judicata.39 We subsequently reversed this ruling on the wrong application
of res judicata in the conclusive case of Suarez. We retained and affirmed, however, the CA's
factual finding of herein respondents' status as heirs of Marcelo Sr. We categorically held
therein that "the proprietary interest of [herein respondents] in the levied and auctioned
[properties] is different from and adverse to that of [Teofista]. [Herein respondents] became
co-owners of the property not because of [Teofista] but through their own right as children of
their deceased father [, Marcelo Sr.]."

Petitioner Valente, along with Violeta, Virginia and Maria Concepcion, became owners of the
subject properties only by virtue of an execution sale to recover Teofista's judgment
obligation. This judgment obligation is solely Teofista's, and payment therefor cannot be made
through an execution sale of properties not absolutely owned by her. These properties were
evidently conjugal properties and were, in fact, even titled in the name of Marcelo, Sr. married
to Teofista. Thus, upon Marcelo Sr.'s death, by virtue of compulsory succession, Marcelo Sr.'s
share in the conjugal partnership was transmitted by operation of law to his compulsory heirs.
Compulsory succession is a distinct kind of succession, albeit not categorized as such in
Article 77843of the Civil Code. It reserves a portion of the net estate of the decedent in favor of
certain heirs, or group of heirs, or combination of heirs, prevailing over all kinds of
succession.44 The portion that is so reserved is the legitime. Article 886 of the Civil Code
defines legitime as "that part of the testator's property which he cannot dispose of because
the law has reserved it for certain heirs who are, therefore, called compulsory heirs." Herein
respondents are primary compulsory heirs, 45 excluding secondary compulsory heirs, 46 and
preferred over concurring compulsory heirs in the distribution of the decedent's estate. 47

Clearly, herein respondents' long possessed status of legitimate children of Marcelo Sr. and
Teofista cannot be indirectly or directly attacked by petitioner Valente in an action to annul a
judicial sale.
Articles 262,40 263,41 265 and 26642 of the Civil Code, the applicable law at the time of
Marcelo's death, support the foregoing conclusion, to wit:
Art. 262. The heirs of the husband may impugn the legitimacy of the child only in the following
cases:

Even without delving into the Extrajudicial Settlement of Marcelo Sr.'s estate in 1957, it must
be stressed that herein respondents' rights to the succession vested from the moment of their
father's death.48 Herein respondents' ownership of the subject properties is no longer
inchoate; it became absolute upon Marcelo's death, although their respective shares therein

(1) If the husband should die before the expiration of the period fixed for bringing his action;
(2) If the husband should die after the filing of the complaint, without having desisted from the
same;
(3) If the child was born after the death of the husband.

34

remained pro indiviso. Ineluctably, at the time the subject properties were sold on execution
sale to answer for Teofista's judgment obligation, the inclusion of herein respondents' share
therein was null and void.

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 xxx.53

In fine, Teofista's ownership over the subject properties is not absolute. Significantly,
petitioner Valente does not even attempt to dispute the conjugal nature of the subject
properties. Since Teofista owns only a portion of the subject properties, only that portion could
have been, and was actually, levied upon and sold on auction by the provincial sheriff of
Rizal. Thus, a separate declaration of heirship by herein respondents is not necessary to
annul the judicial sale of their share in the subject properties.

All told, under the circumstances, in addition to the already settled status of herein
respondents as heirs of Marcelo Sr., there is no need to dismiss Civil Case No. 51203 and
require herein respondents to institute a separate special proceeding for a declaration of their
heirship.
WHEREFORE, premises considered, the petition is DENIED. The Decision of the Court of
Appeals in CA-G.R. SP No. 58090 is AFFIRMED. The Orders dated May 29, 1996 and
September 6, 1996 issued by Judge Santos are REINSTATED. Costs against the petitioner.

We note the recent case of Portugal v. Portugal-Beltran,49 where we scrutinized our rulings
in Heirs of Yaptinchay and the cited cases of Litam v. Rivera50 and Solivio v. Court of
Appeals,51 and Guilas v. CFI Judge of Pampanga52 cited in Solivio. We ruled thus:

SO ORDERED.

The common doctrine in Litam, Solivio and Guilas in which the adverse parties are putative
heirs to the estate of a decedent or parties to the special proceedings for its settlement is that
if the special proceedings are pending, or if there are no special proceedings filed but there
is, under the circumstances of the case, a need to file one, then the determination of, among
other issues, heirship should be raised and settled in said special proceedings. Where special
proceedings had been instituted but had been finally closed and terminated, however, or if a
putative heirs has lost the right to have himself declared in the special proceedings as co-heir
and he can no longer ask for its re-opening, then an ordinary civil action can be filed for his
declaration as heir in order to bring about the annulment of the partition or distribution or
adjudication of a property or properties belonging to the estate of the deceased.
In the case at bar, respondent, believing rightly or wrongly that she was the sole heir to
Portugal's estate, executed on February 15, 1988 the questioned Affidavit of Adjudication
under the second sentence of Rule 74, Section of the Revised Rules of Court. Said rule is an
exception to the general rule that when a person dies leaving 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.
xxx
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 proceedings. And it is superfluous in light of the fact
that the parties to the civil case-subject of the present case, could and had already in fact
presented evidence before the trial court which assumed jurisdiction over the case upon the
issues it defined during pre-trial.

35

share of defendants shall be charged the expenses for scholarship, awards, donations and
the 'Salustia Solivio Vda. de Javellana Memorial Foundation;'
b) Directing the defendant to submit an inventory of the entire estate property, including but
not limited to, specific items already mentioned in this decision and to render an accounting of
the property of the estate, within thirty (30) days from receipt of this judgment; one-half (1/2)
of this produce shall belong to plaintiff;
c) Ordering defendant to pay plaintiff P5,000.00 as expenses of litigation; P10,000.00 for and
as attorney's fees plus costs.
SO ORDERED. (pp. 42-43, Rollo)
This case involves the estate of the late novelist, Esteban Javellana, Jr., author of the first
post-war Filipino novel "Without Seeing the Dawn," who died a bachelor, without
descendants, ascendants, brothers, sisters, nephews or nieces. His only surviving relatives
are: (1) his maternal aunt, petitioner Celedonia Solivio, the spinster half-sister of his mother,
Salustia Solivio; and (2) the private respondent, Concordia Javellana-Villanueva, sister of his
deceased father, Esteban Javellana, Sr.
He was a posthumous child. His father died barely ten (10) months after his marriage in
December, 1916 to Salustia Solivio and four months before Esteban, Jr. was born.
Salustia and her sister, Celedonia (daughter of Engracio Solivio and his second wife Josefa
Fernandez), a teacher in the Iloilo Provincial High School, brought up Esteban, Jr.
Salustia brought to her marriage paraphernal properties (various parcels of land in Calinog,
Iloilo covered by 24 titles) which she had inherited from her mother, Gregoria Celo, Engracio
Solivio's first wife (p. 325, Record), but no conjugal property was acquired during her shortlived marriage to Esteban, Sr.

G.R. No. 83484 February 12, 1990


CELEDONIA
vs.
THE HONORABLE COURT
VILLANUEVA, respondents.

SOLIVIO, petitioner,
OF

APPEALS

and

CONCORDIA

On October 11, 1959, Salustia died, leaving all her properties to her only child, Esteban, Jr.,
including a house and lot in La Paz, Iloilo City, where she, her son, and her sister lived. In due
time, the titles of all these properties were transferred in the name of Esteban, Jr.

JAVELLANA

During his lifetime, Esteban, Jr. had, more than once, expressed to his aunt Celedonia and
some close friends his plan to place his estate in a foundation to honor his mother and to help
poor but deserving students obtain a college education. Unfortunately, he died of a heart
attack on February 26,1977 without having set up the foundation.

Rex Suiza Castillon for petitioner.


Salas & Villareal for private respondent.
MEDIALDEA, J.:

Two weeks after his funeral, Concordia and Celedonia talked about what to do with Esteban's
properties. Celedonia told Concordia about Esteban's desire to place his estate in a
foundation to be named after his mother, from whom his properties came, for the purpose of
helping indigent students in their schooling. Concordia agreed to carry out the plan of the
deceased. This fact was admitted by her in her "Motion to Reopen and/or Reconsider the
Order dated April 3, 1978" which she filed on July 27, 1978 in Special Proceeding No. 2540,
where she stated:

This is a petition for review of the decision dated January 26, 1988 of the Court of Appeals in
CA GR CV No. 09010 (Concordia Villanueva v. Celedonia Solivio) affirming the decision of
the trial court in Civil Case No. 13207 for partition, reconveyance of ownership and
possession and damages, the dispositive portion of which reads as follows:
WHEREFORE, judgment is hereby rendered for the plaintiff and against defendant:
a) Ordering that the estate of the late Esteban Javellana, Jr. be divided into two (2) shares:
one-half for the plaintiff and one-half for defendant. From both shares shall be equally
deducted the expenses for the burial, mausoleum and related expenditures. Against the

4. That petitioner knew all along the narrated facts in the immediately preceding paragraph
[that herein movant is also the relative of the deceased within the third degree, she being the

36

younger sister of the late Esteban Javellana, father of the decedent herein], because prior to
the filing of the petition they (petitioner Celedonia Solivio and movant Concordia Javellana)
have agreed to make the estate of the decedent a foundation, besides they have closely
known each other due to their filiation to the decedent and they have been visiting each
other's house which are not far away for (sic) each other. (p. 234, Record; Emphasis
supplied.)

In the meantime, Celedonia perfected an appeal to the Court of Appeals (CA GR CV No.
09010). On January 26, 1988, the Court of Appeals, Eleventh Division, rendered judgment
affirming the decision of the trial court in toto.Hence, this petition for review wherein she
raised the following legal issues:
1. whether Branch 26 of the RTC of Iloilo had jurisdiction to entertain Civil Case No. 13207 for
partition and recovery of Concordia Villanueva's share of the estate of Esteban Javellana, Jr.
even while the probate proceedings (Spl. Proc. No. 2540) were still pending in Branch 23 of
the same court;

Pursuant to their agreement that Celedonia would take care of the proceedings leading to the
formation of the foundation, Celedonia in good faith and upon the advice of her counsel, filed
on March 8, 1977 Spl. Proceeding No. 2540 for her appointment as special administratrix of
the estate of Esteban Javellana, Jr. (Exh. 2). Later, she filed an amended petition (Exh. 5)
praying that letters of administration be issued to her; that she be declared sole heir of the
deceased; and that after payment of all claims and rendition of inventory and accounting, the
estate be adjudicated to her (p. 115, Rollo).

2. whether Concordia Villanueva was prevented from intervening in Spl. Proc. No. 2540
through extrinsic fraud;
3. whether the decedent's properties were subject to reserva troncal in favor of Celedonia, his
relative within the third degree on his mother's side from whom he had inherited them; and
4. whether Concordia may recover her share of the estate after she had agreed to place the
same in the Salustia Solivio Vda. de Javellana Foundation, and notwithstanding the fact that
conformably with said agreement, the Foundation has been formed and properties of the
estate have already been transferred to it.

After due publication and hearing of her petition, as well as her amended petition, she was
declared sole heir of the estate of Esteban Javellana, Jr. She explained that this was done for
three reasons: (1) because the properties of the estate had come from her sister, Salustia
Solivio; (2) that she is the decedent's nearest relative on his mother's side; and (3) with her as
sole heir, the disposition of the properties of the estate to fund the foundation would be
facilitated.

I. The question of jurisdiction


After a careful review of the records, we find merit in the petitioner's contention that the
Regional Trial Court, Branch 26, lacked jurisdiction to entertain Concordia Villanueva's action
for partition and recovery of her share of the estate of Esteban Javellana, Jr. while the
probate proceedings (Spl, Proc. No. 2540) for the settlement of said estate are still pending in
Branch 23 of the same court, there being as yet no orders for the submission and approval of
the administratix's inventory and accounting, distributing the residue of the estate to the heir,
and terminating the proceedings (p. 31, Record).

On April 3, 1978, the court (Branch II, CFI, now Branch 23, RTC) declared her the sole heir of
Esteban, Jr. Thereafter, she sold properties of the estate to pay the taxes and other
obligations of the deceased and proceeded to set up the "SALUSTIA SOLIVIO VDA. DE
JAVELLANA FOUNDATION" which she caused to be registered in the Securities and
Exchange Commission on July 17,1981 under Reg. No. 0100027 (p. 98, Rollo).
Four months later, or on August 7, 1978, Concordia Javellana Villanueva filed a motion for
reconsideration of the court's order declaring Celedonia as "sole heir" of Esteban, Jr.,
because she too was an heir of the deceased. On October 27, 1978, her motion was denied
by the court for tardiness (pp. 80-81, Record). Instead of appealing the denial, Concordia filed
on January 7, 1980 (or one year and two months later), Civil Case No. 13207 in the Regional
Trial Court of Iloilo, Branch 26, entitled "Concordia Javellana- Villanueva v. Celedonia
Solivio" for partition, recovery of possession, ownership and damages.

It is the order of distribution directing the delivery of the residue of the estate to the persons
entitled thereto that brings to a close the intestate proceedings, puts an end to the
administration and thus far relieves the administrator from his duties (Santiesteban v.
Santiesteban, 68 Phil. 367, Philippine Commercial and Industrial Bank v. Escolin, et al., L27860, March 29, 1974, 56 SCRA 266).
The assailed order of Judge Adil in Spl. Proc. No. 2540 declaring Celedonia as the sole heir
of the estate of Esteban Javellana, Jr. did not toll the end of the proceedings. As a matter of
fact, the last paragraph of the order directed the administratrix to "hurry up the settlement of
the estate." The pertinent portions of the order are quoted below:

On September 3, 1984, the said trial court rendered judgment in Civil Case No. 13207, in
favor of Concordia Javellana-Villanueva.
On Concordia's motion, the trial court ordered the execution of its judgment pending appeal
and required Celedonia to submit an inventory and accounting of the estate. In her motions
for reconsideration of those orders, Celedonia averred that the properties of the deceased
had already been transferred to, and were in the possession of, the 'Salustia Solivio Vda. de
Javellana Foundation." The trial court denied her motions for reconsideration.

2. As regards the second incident [Motion for Declaration of Miss Celedonia Solivio as Sole
Heir, dated March 7, 1978], it appears from the record that despite the notices posted and the
publication of these proceedings as required by law, no other heirs came out to interpose any
opposition to the instant proceeding. It further appears that herein Administratrix is the only
claimant-heir to the estate of the late Esteban Javellana who died on February 26, 1977.

37

During the hearing of the motion for declaration as heir on March 17, 1978, it was established
that the late Esteban Javellana died single, without any known issue, and without any
surviving parents. His nearest relative is the herein Administratrix, an elder [sic] sister of his
late mother who reared him and with whom he had always been living with [sic] during his
lifetime.

partition by itself alone does not terminate the probate proceeding (Timbol v. Cano, 1 SCRA
1271, 1276, L-15445, April 29, 1961; Siguiong v. Tecson, 89 Phil. pp. 28, 30). As long as the
order of the distribution of the estate has not been complied with, the probate proceedings
cannot be deemed closed and terminated Siguiong v. Tecson, supra); because a judicial
partition is not final and conclusive and does not prevent the heirs from bringing an action to
obtain his share, provided the prescriptive period therefore has not elapsed (Mari v. Bonilia,
83 Phil. 137). The better practice, however, for the heir who has not received his share, is to
demand his share through a proper motion in the same probate or administration
proceedings, or for reopening of the probate or administrative proceedings if it had already
been closed, and not through an independent action,which would be tried by another court or
Judge which may thus reverse a decision or order of the probate or intestate court already
final and executed and re-shuffle properties long ago distributed and disposed of. (Ramos v.
Ortuzar, 89 Phil. 730, 741-742; Timbol v. Cano, supra; Jingco v. Daluz, L-5107, April 24,
1953, 92 Phil. 1082; Roman Catholic v. Agustines, L-14710, March 29, 1960, 107 Phil. 455,
460-461; Emphasis supplied)

xxxxxxxxx
2. Miss Celedonia Solivio, Administratrix of this estate, is hereby declared as the sole and
legal heir of the late Esteban S. Javellana, who died intestate on February 26, 1977 at La
Paz, Iloilo City.
The Administratrix is hereby instructed to hurry up with the settlement of this estate so that it
can be terminated. (pp, 14-16, Record)
In view of the pendency of the probate proceedings in Branch 11 of the Court of First Instance
(now RTC, Branch 23), Concordia's motion to set aside the order declaring Celedonia as sole
heir of Esteban, and to have herself (Concordia) declared as co-heir and recover her share of
the properties of the deceased, was properly filed by her in Spl. Proc. No. 2540. Her remedy
when the court denied her motion, was to elevate the denial to the Court of Appeals for
review on certiorari. However, instead of availing of that remedy, she filed more than one year
later, a separate action for the same purpose in Branch 26 of the court. We hold that the
separate action was improperly filed for it is the probate court that has exclusive jurisdiction to
make a just and legal distribution of the estate.

In Litam et al., v. Rivera, 100 Phil. 364, where despite the pendency of the special
proceedings for the settlement of the intestate estate of the deceased Rafael Litam the
plaintiffs-appellants filed a civil action in which they claimed that they were the children by a
previous marriage of the deceased to a Chinese woman, hence, entitled to inherit his one-half
share of the conjugal properties acquired during his marriage to Marcosa Rivera, the trial
court in the civil case declared that the plaintiffs-appellants were not children of the deceased,
that the properties in question were paraphernal properties of his wife, Marcosa Rivera, and
that the latter was his only heir. On appeal to this Court, we ruled that "such declarations (that
Marcosa Rivera was the only heir of the decedent) is improper, in Civil Case No. 2071, it
being within the exclusive competence of the court in Special Proceedings No. 1537, in which
it is not as yet, in issue, and, will not be, ordinarily, in issue until the presentation of the project
of partition. (p. 378).

In the interest of orderly procedure and to avoid confusing and conflicting dispositions of a
decedent's estate, a court should not interfere with probate proceedings pending in a coequal court. Thus, did we rule in Guilas v. Judge of the Court of First Instance of Pampanga,
L-26695, January 31, 1972, 43 SCRA 111, 117, where a daughter filed a separate action to
annul a project of partition executed between her and her father in the proceedings for the
settlement of the estate of her mother:
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 entitled to receive the same.
The finality of the approval of the project of The probate court, in the exercise of its
jurisdiction to make distribution, has power to determine the proportion or parts to which each
distributed is entitled. ... The power to determine the legality or illegality of the testamentary
provision is inherent in the jurisdiction of the court making a just and legal distribution of the
inheritance. ... To hold that a separate and independent action is necessary to that effect,
would be contrary to the general tendency of the jurisprudence of avoiding multiplicity of suits;
and is further, expensive, dilatory, and impractical. (Marcelino v. Antonio, 70 Phil. 388)

However, in the Guilas case, supra, since the estate proceedings had been closed and
terminated for over three years, the action for annulment of the project of partition was
allowed to continue. Considering that in the instant case, the estate proceedings are still
pending, but nonetheless, Concordia had lost her right to have herself declared as co-heir in
said proceedings, We have opted likewise to proceed to discuss the merits of her claim in the
interest of justice.
The orders of the Regional Trial Court, Branch 26, in Civil Case No. 13207 setting aside the
probate proceedings in Branch 23 (formerly Branch 11) on the ground of extrinsic fraud, and
declaring Concordia Villanueva to be a co-heir of Celedonia to the estate of Esteban, Jr.,
ordering the partition of the estate, and requiring the administratrix, Celedonia, to submit an
inventory and accounting of the estate, were improper and officious, to say the least, for
these matters he within the exclusive competence of the probate court.

A judicial declaration that a certain person is the only heir of the decedent is exclusively within
the range of the administratrix proceedings and can not properly be made an independent
action. (Litam v. Espiritu, 100 Phil. 364)
A separate action for the declaration of heirs is not proper. (Pimentel v. Palanca, 5 Phil. 436)

II. The question of extrinsic fraud

38

Was Concordia prevented from intervening in the intestate proceedings by extrinsic


fraud employed by Celedonia? It is noteworthy that extrinsic fraud was not alleged in
Concordia's original complaint in Civil Case No. 13207. It was only in her amended complaint
of March 6, 1980, that extrinsic fraud was alleged for the first time.

2. The probate proceedings are proceedings in rem. Notice of the time and place of hearing
of the petition is required to be published (Sec. 3, Rule 76 in relation to Sec. 3, Rule 79, Rules
of Court). Notice of the hearing of Celedonia's original petition was published in the "Visayan
Tribune" on April 25, May 2 and 9, 1977 (Exh 4, p. 197, Record). Similarly, notice of the
hearing of her amended petition of May 26, 1977 for the settlement of the estate was, by
order of the court, published in "Bagong Kasanag" (New Light) issues of May 27, June 3 and
10, 1977 (pp. 182-305, Record). The publication of the notice of the proceedings was
constructive notice to the whole world. Concordia was not deprived of her right to intervene in
the proceedings for she had actual, as well as constructive notice of the same. As pointed out
by the probate court in its order of October 27, 1978:

Extrinsic fraud, as a ground for annulment of judgment, is any act or conduct of the prevailing
party which prevented a fair submission of the controversy (Francisco v. David, 38 O.G. 714).
A fraud 'which prevents a party from having a trial or presenting all of his case to the court, or
one which operates upon matters pertaining, not to the judgment itself, but to the manner by
which such judgment was procured so much so that there was no fair submission of the
controversy. For instance, if through fraudulent machination by one [his adversary], a litigant
was induced to withdraw his defense or was prevented from presenting an available defense
or cause of action in the case wherein the judgment was obtained, such that the aggrieved
party was deprived of his day in court through no fault of his own, the equitable relief against
such judgment may be availed of. (Yatco v. Sumagui, 44623-R, July 31, 1971). (cited in
Philippine Law Dictionary, 1972 Ed. by Moreno; Varela v. Villanueva, et al., 96 Phil. 248)

... . The move of Concordia Javellana, however, was filed about five months after Celedonia
Solivio was declared as the sole heir. ... .
Considering that this proceeding is one in rem and had been duly published as required by
law, despite which the present movant only came to court now, then she is guilty of laches for
sleeping on her alleged right. (p. 22, Record)

A judgment may be annulled on the ground of extrinsic or collateral fraud, as distinguished


from intrinsic fraud, which connotes any fraudulent scheme executed by a prevailing litigant
'outside the trial of a case against the defeated party, or his agents, attorneys or witnesses,
whereby said defeated party is prevented from presenting fully and fairly his side of the
case. ... The overriding consideration is that the fraudulent scheme of the prevailing litigant
prevented a party from having his day in court or from presenting his case. The fraud,
therefore, is one that affects and goes into the jurisdiction of the court. (Libudan v. Gil, L21163, May 17, 1972, 45 SCRA 17, 27-29; Sterling Investment Corp. v. Ruiz, L-30694,
October 31, 1969, 30 SCRA 318, 323)

The court noted that Concordia's motion did not comply with the requisites of a petition for
relief from judgment nor a motion for new trial.
The rule is stated in 49 Corpus Juris Secundum 8030 as follows:
Where petition was sufficient to invoke statutory jurisdiction of probate court and proceeding
was in rem no subsequent errors or irregularities are available on collateral attack. (Bedwell v.
Dean 132 So. 20)
Celedonia's allegation in her petition that she was the sole heir of Esteban within the third
degree on his mother's side was not false. Moreover, it was made in good faith and in the
honest belief that because the properties of Esteban had come from his mother, not his
father, she, as Esteban's nearest surviving relative on his mother's side, is the rightful heir to
them. It would have been self-defeating and inconsistent with her claim of sole heirshipif she
stated in her petition that Concordia was her co-heir. Her omission to so state did not
constitute extrinsic fraud.

The charge of extrinsic fraud is, however, unwarranted for the following reasons:
1. Concordia was not unaware of the special proceeding intended to be filed by Celedonia.
She admitted in her complaint that she and Celedonia had agreed that the latter would
"initiate the necessary proceeding" and pay the taxes and obligations of the estate. Thus
paragraph 6 of her complaint alleged:

Failure to disclose to the adversary, or to the court, matters which would defeat one's own
claim or defense is not such extrinsic fraud as will justify or require vacation of the judgment.
(49 C.J.S. 489, citing Young v. Young, 2 SE 2d 622; First National Bank & Trust Co. of King
City v. Bowman, 15 SW 2d 842; Price v. Smith, 109 SW 2d 1144, 1149)

6. ... for the purpose of facilitating the settlement of the estate of the late Esteban Javellana,
Jr. at the lowest possible cost and the least effort, the plaintiff and the defendant agreed that
the defendant shall initiate the necessary proceeding, cause the payment of taxes and other
obligations, and to do everything else required by law, and thereafter, secure the partition of
the estate between her and the plaintiff, [although Celedonia denied that they agreed to
partition the estate, for their agreement was to place the estate in a foundation.] (p. 2,
Record; emphasis supplied)

It should be remembered that a petition for administration of a decedent's estate may be filed
by any "interested person" (Sec. 2, Rule 79, Rules of Court). The filing of Celedonia's petition
did not preclude Concordia from filing her own.
III. On the question of reserva troncal

Evidently, Concordia was not prevented from intervening in the proceedings. She stayed
away by choice. Besides, she knew that the estate came exclusively from Esteban's mother,
Salustia Solivio, and she had agreed with Celedonia to place it in a foundation as the
deceased had planned to do.

We find no merit in the petitioner's argument that the estate of the deceased was subject
to reserva troncal and that it pertains to her as his only relative within the third degree on his

39

mother's side. The reserva troncalprovision of the Civil Code is found in Article 891 which
reads as follows:

IV. The question of Concordia's one-half share


However, inasmuch as Concordia had agreed to deliver the estate of the deceased to the
foundation in honor of his mother, Salustia Solivio Vda. de Javellana (from whom the estate
came), an agreement which she ratified and confirmed in her "Motion to Reopen and/or
Reconsider Order dated April 3, 1978" which she filed in Spl. Proceeding No. 2540:

ART. 891. The ascendant who inherits from his descendant any property which the latter may
have acquired by gratuitous title from another ascendant, or a brother or sister, is obliged to
reserve such property as he may have acquired by operation of law for the benefit of relatives
who are within the third degree and who belong to the line from which said property came.

4. That ... prior to the filing of the petition they (petitioner Celedonia Solivio and movant
Concordia Javellana) have agreed to make the estate of the decedent a foundation, besides
they have closely known each other due to their filiation to the decedent and they have been
visiting each other's house which are not far away for (sic) each other. (p. 234, Record;
Emphasis supplied)

The persons involved in reserva troncal are:


1. The person obliged to reserve is the reservor (reservista)the ascendant who inherits by
operation of law property from his descendants.
2. The persons for whom the property is reserved are the reservees (reservatarios)relatives
within the third degree counted from the descendant (propositus), and belonging to the line
from which the property came.

she is bound by that agreement. It is true that by that agreement, she did not waive her
inheritance in favor of Celedonia, but she did agree to place all of Esteban's estate in the
"Salustia Solivio Vda. de Javellana Foundation" which Esteban, Jr., during his lifetime,
planned to set up to honor his mother and to finance the education of indigent but deserving
students as well.

3. The propositusthe descendant who received by gratuitous title and died without issue,
making his other ascendant inherit by operation of law. (p. 692, Civil Law by Padilla, Vol. II,
1956 Ed.)

Her admission may not be taken lightly as the lower court did. Being a judicial admission, it is
conclusive and no evidence need be presented to prove the agreement (Cunanan v. Amparo,
80 Phil. 227; Granada v. Philippine National Bank, L-20745, Sept. 2, 1966, 18 SCRA 1; Sta.
Ana v. Maliwat, L-23023, Aug. 31, 1968, 24 SCRA 1018; People v. Encipido, G.R.70091, Dec.
29, 1986, 146 SCRA 478; and Rodillas v. Sandiganbayan, G.R. 58652, May 20, 1988, 161
SCRA 347).

Clearly, the property of the deceased, Esteban Javellana, Jr., is not reservable property, for
Esteban, Jr. was not an ascendant, but the descendant of his mother, Salustia Solivio, from
whom he inherited the properties in question. Therefore, he did not hold his inheritance
subject to a reservation in favor of his aunt, Celedonia Solivio, who is his relative within the
third degree on his mother's side. The reserva troncal applies to properties inherited by an
ascendant from a descendant who inherited it from another ascendant or 9 brother or sister. It
does not apply to property inherited by a descendant from his ascendant, the reverse of the
situation covered by Article 891.
Since the deceased, Esteban Javellana, Jr., died without descendants, ascendants,
illegitimate children, surviving spouse, brothers, sisters, nephews or nieces, what should
apply in the distribution of his estate are Articles 1003 and 1009 of the Civil Code which
provide:

The admission was never withdrawn or impugned by Concordia who, significantly, did not
even testify in the case, although she could have done so by deposition if she were
supposedly indisposed to attend the trial. Only her husband, Narciso, and son-in-law, Juanito
Domin, actively participated in the trial. Her husband confirmed the agreement between his
wife and Celedonia, but he endeavored to dilute it by alleging that his wife did not intend to
give all, but only one-half, of her share to the foundation (p. 323, Record).

ART. 1003. If there are no descendants, ascendants, illegitimate children, or a surviving


spouse, the collateral relatives shall succeed to the entire estate of the deceased in
accordance with the following articles.

The records show that the "Salustia Solivio Vda. de Javellana Foundation" was established
and duly registered in the Securities and Exchange Commission under Reg. No. 0100027 for
the following principal purposes:

ART. 1009. Should there be neither brothers nor sisters, nor children of brothers or sisters,
the other collateral relatives shall succeed to the estate.

1. To provide for the establishment and/or setting up of scholarships for such deserving
students as the Board of Trustees of the Foundation may decide of at least one scholar each
to study at West Visayas State College, and the University of the Philippines in the Visayas
both located in Iloilo City.

The latter shall succeed without distinction of lines or preference among them by reason of
relationship by the whole blood.

2. To provide a scholarship for at least one scholar for St. Clements Redemptorist Community
for a deserving student who has the religious vocation to become a priest.

Therefore, the Court of Appeals correctly held that:


Both plaintiff-appellee and defendant-appellant being relatives of the decedent within the third
degree in the collateral line, each, therefore, shall succeed to the subject estate 'without
distinction of line or preference among them by reason of relationship by the whole blood,'
and is entitled one-half (1/2) share and share alike of the estate. (p. 57, Rollo)

3. To foster, develop, and encourage activities that will promote the advancement and
enrichment of the various fields of educational endeavors, especially in literary arts.

40

Scholarships provided for by this foundation may be named after its benevolent benefactors
as a token of gratitude for their contributions.

Further, the Foundation had constructed the Esteban S. Javellana Multi-purpose Center at
the West Visayas State University for teachers' and students' use, and has likewise
contributed to religious civic and cultural fund-raising drives, amongst other's. (p. 10, Rollo)

4. To direct or undertake surveys and studies in the community to determine community


needs and be able to alleviate partially or totally said needs.

Having agreed to contribute her share of the decedent's estate to the Foundation, Concordia
is obligated to honor her commitment as Celedonia has honored hers.

5. To maintain and provide the necessary activities for the proper care of the Solivio-Javellana
mausoleum at Christ the King Memorial Park, Jaro, Iloilo City, and the Javellana Memorial at
the West Visayas State College, as a token of appreciation for the contribution of the estate
of the late Esteban S. Javellana which has made this foundation possible. Also, in
perpetuation of his Roman Catholic beliefs and those of his mother, Gregorian masses or
their equivalents will be offered every February and October, and Requiem masses every
February 25th and October llth, their death anniversaries, as part of this provision.

WHEREFORE, the petition for review is granted. The decision of the trial court and the Court
of Appeals are hereby SET ASIDE. Concordia J. Villanueva is declared an heir of the late
Esteban Javellana, Jr. entitled to one-half of his estate. However, comformably with the
agreement between her and her co-heir, Celedonia Solivio, the entire estate of the deceased
should be conveyed to the "Salustia Solivio Vda. de Javallana Foundation," of which both the
petitioner and the private respondent shall be trustees, and each shall be entitled to nominate
an equal number of trustees to constitute the Board of Trustees of the Foundation which shall
administer the same for the purposes set forth in its charter. The petitioner, as administratrix
of the estate, shall submit to the probate court an inventory and accounting of the estate of
the deceased preparatory to terminating the proceedings therein.

6. To receive gifts, legacies, donations, contributions, endowments and financial aids or loans
from whatever source, to invest and reinvest the funds, collect the income thereof and pay or
apply only the income or such part thereof as shall be determined by the Trustees for such
endeavors as may be necessary to carry out the objectives of the Foundation.

SO ORDERED.

7. To acquire, purchase, own, hold, operate, develop, lease, mortgage, pledge, exchange,
sell, transfer, or otherwise, invest, trade, or deal, in any manner permitted by law, in real and
personal property of every kind and description or any interest herein.
8. To do and perform all acts and things necessary, suitable or proper for the
accomplishments of any of the purposes herein enumerated or which shall at any time
appear conducive to the protection or benefit of the corporation, including the exercise of the
powers, authorities and attributes concerned upon the corporation organized under the laws
of the Philippines in general, and upon domestic corporation of like nature in particular. (pp. 910, Rollo)
As alleged without contradiction in the petition' for review:
The Foundation began to function in June, 1982, and three (3) of its eight Esteban Javellana
scholars graduated in 1986, one (1) from UPV graduated Cum Laude and two (2) from
WVSU graduated with honors; one was a Cum Laude and the other was a recipient of Lagos
Lopez award for teaching for being the most outstanding student teacher.
The Foundation has four (4) high school scholars in Guiso Barangay High School, the site of
which was donated by the Foundation. The School has been selected as the Pilot Barangay
High School for Region VI.
The Foundation has a special scholar, Fr. Elbert Vasquez, who would be ordained this year.
He studied at St. Francis Xavier Major Regional Seminary at Davao City. The Foundation
likewise is a member of the Redemptorist Association that gives yearly donations to help poor
students who want to become Redemptorist priests or brothers. It gives yearly awards for
Creative writing known as the Esteban Javellana Award.

41

In a Resolution dated October 26, 1953 in Sp. Proc. No. 894 entitled "En el Asunto de la
Adopcion de la Menor Juanita Lopez y Limson" (pp. 92-94, 103, rec.), herein petitioner
Juanita Lopez, then single and now married to Federico Guilas, was declared legally adopted
daughter and legal heir of the spouses Jacinta and Alejandro. After adopting legally herein
petitioner Juanita Lopez, the testatrix Doa Jacinta did not execute another will or codicil so
as to include Juanita Lopez as one of her heirs.
In an order dated March 5, 1959 in Testate Proceedings No. 1426, the aforementioned will
was admitted to probate and the surviving husband, Alejandro Lopez y Siongco, was
appointed executor without bond by the Court of First Instance of Pampanga (Annexes "A"
and "B", pp. 18-23, rec.). Accordingly, Alejandro took his oath of office as executor (Annex
"C", p. 24, rec.).
Nevertheless, in a project of partition dated March 19, 1960 executed by both Alejandro
Lopez and Juanita Lopez Guilas, the right of Juanita Lopez to inherit from Jacinta was
recognized and Lots Nos. 3368 and 3441 (Jacinta's paraphernal property), described and
embraced in Original Certificate of Title No. 13092, both situated in Bacolor Pampanga Lot
3368 with an area of 68,141 square meters and Lot 3441 with an area of 163,231 square
meters, then assessed respectively at P3,070.00 and P5,800.00 (Annex "D", pp. 27-36, rec.)
were adjudicated to Juanita Lopez-Guilas as her share free from all liens, encumbrances
and charges, with the executor Alejandro Lopez, binding himself to free the said two parcels
from such liens, encumbrances and charges. The rest of the estate of the deceased
consisting of 28 other parcels of lands with a total assessed valuation of P69,020.00 and a
combined area of 743,924.67 square meters, as well as personal properties including a 1953
Buick car valued at P2,500.00 were allotted to Don Alejandro who assumed all the mortgage
liens on the estate (Annex "D", pp. 25-37, rec.).
In an order dated April 23, 1960, the lower court approved the said project of partition and
directed that the records of the case be sent to the archives, upon payment of the estate and
inheritance taxes (Annex "E", p. 38, rec.). Upon ex-parte petition of the adjudicatees
Alejandro Lopez and Juanita Lopez-Guilas dated August 25, 1961 (Annex "F", pp. 39-40,
rec.), the lower court in an order dated August 28, 1961, approved the correction of clerical
errors appearing in the project of partition (Annex "G", p. 41, rec.).

G.R. No. L-26695 January 31, 1972


JUANITA
LOPEZ
GUILAS, petitioner,
vs.
JUDGE OF THE COURT OF FIRST INSTANCE OF PAMPANGA AND ALEJANDRO
LOPEZ respondents .

On April 10, 1964, herein petitioner Juanita Lopez-Guilas filed a separate ordinary action to
set aside and annul the project of partition, which case was docketed as Civil Case 2539
entitled "Juanita Lopez-Guilas vs. Alejandro Lopez" in the Court of First Instance of
Pampanga, on the ground of lesion, perpetration and fraud, and pray further that Alejandro
Lopez be ordered to submit a statement of accounts of all the crops and to deliver
immediately to Juanita lots nos. 3368 and 3441 of the Bacolor Cadastre, which were
allocated to her under the project of partition (p. 132, rec.).

Filemon Cajator for petitioner.


Eligio G. Lagman for respondent Alejandro Lopez.
MAKASIAR, J.:p
It appears from the records that Jacinta Limson de Lopez, of Guagua, Pampanga was
married to Alejandro Lopez y Siongco. They had no children.

Meanwhile, in Testate Proceedings No. 1426, Juanita filed a petition dated July 20, 1964
praying that Alejandro Lopez be directed to deliver to her the actual possession of said lots

On April 28, 1936, Jacinta executed a will instituting her husband Alejandro as her sole heir
and executor (pp. 20-21, rec.).

42

nos. 3368 and 3441 as well as the 1,216 caverns of palay that he collected from the ten (10)
tenants or lessees of the said two lots (Annex "H", pp. 42-44, rec.).

of the project of partition as a prejudicial question, her filing an amended complaint on June
11, 1965 in civil case No. 2539 wherein she admitted the partial legality and validity of the
project of partition with respect to the adjudication to her of the two lots as her share,
rendered said civil case No. 2539 no longer a prejudicial question to her petition of July 20,
1964 for the delivery of her share (Annex "L", pp. 55-59, rec.).

In his opposition dated August 5, 1964 to the said petition, Alejandro Lopez claims that, by
virtue of the order dated April 23, 1960 which approved the project of partition submitted by
both Alejandro and Juanita and directed that the records of the case be archived upon
payment of the estate and inheritance taxes, and the order of December 15, 1960 which
"ordered closed and terminated the present case", the testate proceedings had already been
closed and terminated; and that he ceased as a consequence to be the executor of the estate
of the deceased; and that Juanita Lopez is guilty of laches and negligence in filing the petition
of the delivery of her share 4 years after such closure of the estate, when she could have filed
a petition for relief of judgment within sixty (60) days from December 15, 1960 under Rule 38
of the old Rules of Court (Annex "I") citing A. Austria vs. Heirs of Antonio Ventenilla, L100808, Sept. 18, 1956 (pp. 45-48, rec.).

Alejandro filed his opposition dated December 1, 1965 to the aforesaid motion of Juanita to
set aside the order dated October 2, 1964 (Annex "M", pp. 60-61, rec.), to which Juanita filed
her rejoinder dated December 6, 1965 wherein she stated among others that pursuant to the
project of partition, executor Alejandro secured the cancellation of OCT. No. 13093 covering
the two parcels of land adjudicated to her under the project of partition and the issuance in his
exclusive name on August 4, 1961 TCT No. 26638-R covering the said Lots Nos. 3368 and
3441 of the Bacolor Cadastre (Annex "N", pp. 62-71, rec.).
In an order dated April 27, 1966, the lower court denied Juanita's motion to set aside the
order of October 2, 1964 on the ground that the parties themselves agreed to suspend
resolution of her petition for the delivery of her shares until after the civil action for annulment
of the project of partition has been finally settled and decided (Annex "O", p. 72, rec.).

In her reply dated November 17, 1965 to said opposition, Juanita contends that the actual
delivery and distribution of the hereditary shares to the heirs, and not the order of the court
declaring as closed and terminated the proceedings, determines the termination of the
probate proceedings (citing Intestate estate of the deceased Mercedes Cano, Timbol vs.
Cano, 59 O.G. No. 30, pp. 46-73, April 29, 1961, where it was ruled that "the probate court
loses jurisdiction of an estate under administration only after the payment of all the taxes, and
after the remaining estate is delivered to the heirs entitled to receive the same"); that the
executor Alejandro is estopped from opposing her petition because he was the one who
prepared, filed and secured court approval of, the aforesaid project of partition, which she
seeks to be implemented; that she is not guilty of laches, because when she filed on July 20,
1964, her petition for he delivery of her share allocated to her under the project of partition,
less than 3 years had elapsed from August 28, 1961 when the amended project of partition
was approved, which is within the 5-year period for the execution of judgment by motion
(Annex "J", pp. 49-52, rec.).

Juanita filed a motion dated May 9, 1966 for the reconsideration of the order dated April 27,
1966 (Annex "P" pp. 73-77, rec.), to which Alejandro filed an opposition dated June 8, 1966
(Annex "Q", pp. 112-113, rec.).
Subsequently, Alejandro filed a motion dated July 25, 1966 praying that the palay deposited
with Fericsons and Ideal Rice Mill by the ten (10) tenants of the two parcels in question be
delivered to him (Annex "R", pp. 114-116, rec.),to which Juanita filed an opposition dated July
26, 1966 (Annex "S", pp. 117-121, rec.). In an order dated September 8, 1966, the lower
court denied the motion for reconsideration of the order dated April 27, 1966, and directed
Fericsons Inc. and the Ideal Rice Mills to deliver to Alejandro or his representative the 229
cavans and 46 kilos and 325 and 1/2 cavans and 23 kilos of palay respectively deposited with
the said rice mills upon the filing by Alejandro of a bond in the amount of P12,000.00 duly
approved by the court (Annex "T", pp. 122-127, rec.). Hence, this petition
for certiorari and mandamus.

In its order dated October 2, 1964, the lower court after a "pre-trial" stated that because the
civil action for the annulment of the project of partition was filed on April 13, 1964, before the
filing on July 2, 1964 of the petition for delivery of the shares of Juanita Lopez, "the parties
have agreed to suspend action or resolution upon the said petition for the delivery of shares
until; after the civil action aforementioned has been finally settled and decided", and forthwith
set the civil action for annulment for trial on November 25, and December 2, 1964 (Annex "K",
pp. 53-54, rec.).

The position of petitioner Juanita Lopez-Guilas should be sustained and the writs prayed for
granted.
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 entitled to receive the same.
The finality of the approval of the project of partition by itself alone does not terminate the
probate proceeding (Timbol vs. Cano, 1 SCRA 1271, 1276, L-15445, April 29, 1961; Siguiong
vs. Tecson, 89 Phil., pp. 28-30). As long as the order of the distribution of the estate has not
been complied with, the probate proceedings cannot be deemed closed and terminated
Siguiong vs. Tecson, supra.); because a judicial partition is not final and conclusive and does
not prevent the heir from bringing an action to obtain his share, provided the prescriptive
period therefor has not elapsed (Mari vs. Bonilla, 83 Phil., 137). The better practice, however,

On June 11, 1965, Juanita filed an amended complaint in Civil Case 2539 (pp. 78-110, rec.),
where she acknowledges the partial legality and validity of the project of partition insofar as
the allocation in her favor of the Lots Nos. 3368 and 3441, the delivery of which she is
seeking (pp. 106-107, rec.).
In her motion dated November 17, 1965, Juanita sought the setting aside of the order dated
October 2, 1964 on the ground that while the said order considered her action for annulment

43

for the heir who has not received his share, is to demand his share through a proper motion
in the same probate or administration proceedings, or for re-opening of the probate or
administrative proceedings if it had already been closed, and not through an independent
action, which would be tried by another court or Judge which may thus reverse a decision or
order of the probate on intestate court already final and executed and re-shuffle properties
long ago distributed and disposed of (Ramos vs. Ortuzar, 89 Phil., 730, 741-742; Timbol vs.
Cano, supra.; Jingco vs. Daluz, L-5107, April 24, 1953, 92 Phil. 1082; Roman Catholic vs.
Agustines, L-14710, March 29, 1960, 107 Phil., 455, 460-461).

(a) the Register of Deeds of Pampanga to cancel TCT No. 26638-R covering the aforesaid
lots Nos. 3368 and 3441 of the Bacolor Cadastre and to issue anew Transfer Certificate of
Title covering the said two lots in the name of herein petitioner Juanita Lopez Guilas; and
(b) the respondent Alejandro Lopez
(1) to deliver to herein petitioner Juanita Lopez Guilas the possession of lots Nos. 3368 and
3441;
(2) to deliver and/or pay to herein, petitioner all the rents, crops or income collected by him
from said lots Nos. 3368 and 3441 from April 23, 1960 until the possession of the two
aforementioned lots is actually delivered to her, or their value based on the current market
price; and

Section 1 of Rule 90 of the Revised Rules of Court of 1964 as worded, which secures for the
heirs or legatees the right to "demand and recover their respective shares from the executor
or administrator, or any other person having the same in his possession", re-states the
aforecited doctrines.

(3) to pay the costs.


So ordered.

The case of Austria vs. Heirs of Ventenilla (99 Phil. 1068) does not control the present
controversy; because the motion filed therein for the removal of the administratrix and the
appointment of a new administrator in her place was rejected by the court on the ground of
laches as it was filed after the lapse of about 38 years from October 5, 1910 when the court
issued an order settling and deciding the issues raised by the motion (L-10018, September
19, 1956, 99 Phil., 1069-1070). In the case at bar, the motion filed by petitioner for the
delivery of her share was filed on July 20, 1964, which is just more than 3 years from August
28, 1961 when the amended project of partition was approve and within 5 years from April 23,
1960 when the original project of partition was approved. Clearly, her right to claim the two
lots allocated to her under the project of partition had not yet expired. And in the light of
Section 1 of Rule 90 of the Revised Rules of Court of 1964 and the jurisprudence above
cited, the order dated December 15, 1960 of the probate court closing and terminating the
probate case did not legally terminate the testate proceedings, for her share under the project
of partition has not been delivered to her.

Concepcion, C.J., Reyes, J.B.L., Makalintal, Zaldivar, Castro, Fernando, Teehankee, Barredo
and Villamor, JJ., concur.

While it is true that the order dated October 2, 1964 by agreement of the parties suspended
resolution of her petition for the delivery of her shares until after the decision in the civil action
for the annulment of the project of partition (Civil Case 2539) she filed on April 10, 1964; the
said order lost its validity and efficacy when the herein petitioner filed on June 11, 1965 an
amended complaint in said Civil Case 2539 wherein she recognized the partial legality and
validity of the said project of partition insofar as the allocation in her favor of lots Nos. 3368
and 3441 in the delivery of which she has been insisting all along (pp. 106-107, rec.).
WHEREFORE, judgment is hereby rendered:
1. Granting the writs prayed for;
2. Setting aside the orders of the respondent court dated October 2, 1964 and April 27, 1966,
as null and void; and, without prejudice to the continuance of Civil Case No. 2539, which, by
reason of this decision, involves no longer Lots 3368 and 3441 of the Bacolor Cadastre, .
3. Directing.

44

On November 25, 1942, Jose Q. Portugal (Portugal) married Paz Lazo. 3


On May 22, 1948, Portugal married petitioner Isabel de la Puerta. 4
On September 13, 1949, petitioner Isabel gave birth to a boy whom she named Jose Douglas
Portugal Jr., her herein co-petitioner.5
On April 11, 1950, Paz gave birth to a girl, Aleli, 6 later baptized as Leonila Perpetua Aleli
Portugal, herein respondent.7
On May 16, 1968, Portugal and his four (4) siblings executed a Deed of Extra-Judicial
Partition and Waiver of Rights8 over the estate of their father, Mariano Portugal, who died
intestate on November 2, 1964.9 In the deed, Portugals siblings waived their rights, interests,
and participation over a 155 sq. m. parcel of land located in Caloocan in his favor. 10
On January 2, 1970, the Registry of Deeds for Caloocan City issued Transfer Certificate of
Title (TCT) No. 34292 covering the Caloocan parcel of land in the name of "Jose Q.
Portugal, married to Paz C. Lazo."11
On February 18, 1984, Paz died.
On April 21, 1985, Portugal died intestate.
On February 15, 1988, respondent executed an "Affidavit of Adjudication by Sole Heir of
Estate of Deceased Person" 12 adjudicating to herself the Caloocan parcel of land. TCT No.
34292/T-17213 in Portugals name was subsequently cancelled and in its stead TCT No.
15981314 was issued by the Registry of Deeds for Caloocan City on March 9, 1988 in the
name of respondent, "Leonila Portugal-Beltran, married to Merardo M. Beltran, Jr."
Later getting wind of the death in 1985 of Portugal and still later of the 1988 transfer by
respondent of the title to the Caloocan property in her name, petitioners filed before the RTC
of Caloocan City on July 23, 1996 a complaint 15 against respondent for annulment of the
Affidavit of Adjudication executed by her and the transfer certificate of title issued in her
name.
G.R. No. 155555. August 16, 2005
ISABEL P. PORTUGAL and JOSE DOUGLAS
vs.
LEONILA PORTUGAL-BELTRAN, Respondent.

PORTUGAL

In their complaint, petitioners alleged that respondent is not related whatsoever to the
deceased Portugal, hence, not entitled to inherit the Caloocan parcel of land and that she
perjured herself when she made false representations in her Affidavit of Adjudication.

JR., Petitioners,

Petitioners accordingly prayed that respondents Affidavit of Adjudication and the TCT in her
name be declared void and that the Registry of Deeds for Caloocan be ordered to cancel the
TCT in respondents name and to issue in its stead a new one in their (petitioners) name,
and that actual, moral and exemplary damages and attorneys fees and litigation expenses be
awarded to them.

DECISION
CARPIO MORALES, J.:
Petitioners Isabel P. Portugal and her son, Jose Douglas Portugal Jr., assail the September
24, 20021 Decision of the Court of Appeals affirming that of the Regional Trial Court (RTC) of
Caloocan City, Branch 1242 which dismissed, after trial, their complaint for annulment of
title for failure to state a cause of action and lack of jurisdiction.

Following respondents filing of her answer, the trial court issued a Pre-Trial Order chronicling,
among other things, the issues as follows:
a. Which of the two (2) marriages contracted by the deceased Jose Q. Portugal Sr., is valid?

From the records of the case are gathered the following material allegations claims of the
parties which they sought to prove by testimonial and documentary evidence during the trial
of the case:

b. Which of the plaintiff . . . Jose Portugal Jr. and defendant Leonila P. Beltran is the legal
heir of the deceased Jose Q. Portugal Sr.?

45

c. Whether or not TCT No. 159813 was issued in due course and can still be contested by
plaintiffs.

criminal case for that matter, the court may pass upon the validity of marriage even after the
death of the parties thereto, and even in a suit not directly instituted to question the validity of
said marriage, so long as it is essential to the determination of the case. (Nial, et al. v.
Bayadog, GR No. 13378, March 14, 2000). In such cases, evidence must be adduced,
testimonial or documentary, to prove the existence of grounds rendering such a previous
marriage an absolute nullity. These need not be limited solely to an earlier final judgment of a
court declaring such previous marriage void. (Domingo v. Court of Appeals, supra) (Emphasis
and underscoring supplied).

d. Whether or not plaintiffs are entitled to their claims under the complaint. 16 (Underscoring
supplied)
After trial, the trial court, by Decision of January 18, 2001, 17 after giving an account of the
testimonies of the parties and their witnesses and of their documentary evidence, without
resolving the issues defined during pre-trial, dismissed the case for lack of cause of
action on the ground that petitioners status and right as putative heirs had not been
established before a probate (sic) court, and lack of jurisdiction over the case, citing Heirs
of Guido and Isabel Yaptinchay v. Del Rosario.18

Conceding that the ruling in Cario was promulgated (in 2001) subsequent to that of Heirs of
Guido and Isabel Yaptinchay (in 1999), the appellate court found Cario to be inapplicable,
however, to the case in this wise:

In relying on Heirs of Guido and Isabel Yaptinchay, the trial court held:

To be borne in mind is the fact that the main issue in the Cario case was the validity of the
two marriagescontracted by the deceased SPO4 Santiago Cario, whose death benefits was
the bone of contention between the two women both named Susan (viz., Susan Nicdao
Cario and Susan Yee Cario) both of whom he married. It is not disputed in said case that
SPO4 S. Cario contracted two marriages with said two women during his lifetime, and the
only question was: which of these two marriages was validly celebrated? The award of the
death benefits of the deceased Cario was thus, merely an incident to the question of which
of the two marriages was valid. Upon the other hand, the case at bench is of a different
milieu. The main issue here is the annulment oftitle to property. The only undisputed fact in
this case is that the deceased Jose Portugal, during his lifetime, owned a parcel of land
covered by Transfer Certificate of Title (TCT) No. T-34292. However, here come two
contending parties, herein plaintiffs-appellants and defendant-appellee, both now
insisting to be the legal heir(s) of the decedent. x x x. The status and rights of the parties
herein have not, therefore, been definitively established, as yet. x x x. Necessarily and
naturally, such questions as to such status or right must be properly ventilated in an
appropriate special proceeding, not in an ordinary civil action, whereunder a party sues
another for the enforcement or protection of a right, or the protection or redress of a
wrong. The institution of an ordinary civil suit for that purpose in the present case is thus
impermissible. For it is axiomatic that what the law prohibits or forbids directly, it cannot
permit or allow indirectly. To permit, or allow, a declaration of heirship, or the establishment of
the legitimacy or illegitimacy of a child to be determined in an ordinary civil action, not in an
appropriate special proceeding brought for that purpose, is thus to impinge upon this axiom. x
x x21 (Emphasis in the original, underscoring supplied).

The Heirs of Yaptinchay case arose from facts not dissimilar to the case at bar.
xxx
In the instant case, plaintiffs presented a Marriage Contract, a Certificate of Live Birth,
pictures (sic) and testimonial evidence to establish their right as heirs of the decedent. Thus,
the preliminary act of having a status and right to the estate of the decedent, was sought to
be determined herein. However, the establishment of a status, a right, or a particular fact
is remedied through a special proceeding (Sec. 3(c), Rule 1, 1997 Rules of Court), not an
ordinary civil action whereby a party sues another for the enforcement or protection of a right,
or the protection or redress of a wrong (ibid, a). The operative term in the former is "to
establish", while in the latter, it is "to enforce", a right. Their status and right as putative heirs
of the decedent not having been established, as yet, the Complaint failed to state a cause of
action.
The court, not being a probate (sic) court, is without jurisdiction to rule on plaintiffs cause to
establish their status and right herein. Plaintiffs do not have the personality to sue (Secs. 1
and 2, Rule 3, in relation to Secs. 1 and 2, Rule 2, supra).19 (Italics in the original; emphasis
and underscoring supplied).
Petitioners thereupon appealed to the Court of Appeals, questioning the trial courts ratio
decedendi in dismissing the case as diametrically opposed to this Courts following ruling
in Cario v. Cario,20 viz:
Under Article 40 of the Family Code, the absolute nullity of a previous marriage may be
invoked for purposes of remarriage on the basis solely of a final judgment declaring such
previous marriage void. Meaning, where the absolute nullity of a previous marriage is sought
to be invoked for purposes of contracting a second marriage, the sole basis acceptable in
law, for said projected marriage to be free from legal infirmity, is a final judgment declaring the
previous void. (Domingo v. Court of Appeals, 226 SCRA 572, 579 [1993]) However, for
purposes other than remarriage, no judicial action is necessary to declare a marriage an
absolute nullity. For other purposes, such as but not limited to the determination of heirship,
legitimacy or illegitimacy of a child, settlement of estate, dissolution of property regime, or a

The appellate court, by Decision of September 24, 2002, 22 thus affirmed the trial courts
dismissal of the case.
Hence, the present Petition for Review on Certiorari,23 faulting the appellate court to have
erred when
I.

46

. . . it affirmed the RTC decision dismissing the initiatory complaint as it failed to state a cause
of action.

they are the legal heirs of the aforementioned Yaptinchaysthat they have been declared
the legal heirs of the deceased couple. Now, the determination of who are the legal heirs of
the deceased couple must be made in the proper special proceedings in court, and not in an
ordinary suit for reconveyance of property. This must take precedence over the action for
reconveyance . . .27 (Italics in the original; underscoring supplied).

II.
. . . (i) it applied the ruling in Heirs of Guido [and Isabel] Yaptingchay despite the existence of
a later and contrary ruling in Cario, and (ii) when the Honorable CA and the lower
court failed to render judgment based on the evidence presented relative to
the issues raised during pre-trial, . . .24 (Emphasis and underscoring supplied).

On petition for certiorari by the Heirs, this Court, albeit holding that the petition was an
improper recourse, found that the trial court did not commit grave abuse of discretion in
dismissing the case. Citing Litam et al. v. Rivera28and Solivio v. Court of Appeals,29 this Court
held that "the declaration of heirship can be made only in a special proceeding inasmuch as
the petitioners here are seeking the establishment of a status or right."

Petitioners thus prayed as follows:


WHEREFORE, it is respectfully prayed of this Honorable Supreme Court that the questioned
CA decision bereversed, and a new one entered in accordance with the prayers set forth in
the instant complaint based on the above disquisition and evidence adduced by petitioners in
the court a quo.

In the above-cited case of Litam,30 Gregorio Dy Tam instituted a special proceeding for
issuance of letters of administration before the then Court of First Instance (CFI) of Rizal,
alleging in his petition that he is the son of Rafael Litam who died in Manila on January 10,
1951 and is survived by him and his therein named seven (7) siblings who are children of the
decedent by his marriage to Sia Khin celebrated in China in 1911; that the decedent
contracted in 1922 in the Philippines another marriage with Marcosa Rivera; and that the
decedent left neither a will nor debt. Dy Tam thus prayed for the issuance of letters of
administration to Marcosa Rivera, "the surviving spouse of the decedent." The CFI granted
the petition and issued letters of administration to, on Marcosas request, her nephew Arminio
Rivera.

IN THE ALTERNATIVE, should the Honorable Supreme Court find that the pronouncements
in Cario apply, a decision be entered remanding to the court a quo the determination of the
issues of which of the two marriages is valid, and the determination of "heirship" and
legitimacy of Jose Jr. and Leonila preparatory to the determination of the annulment of title
issued in the name of Leonila.
Other relief and remedy just and equitable in the premises are likewise prayed
for.25 (Underscoring supplied).
Petitioners, in the main, argue that the appellate court misapplied Heirs of Guido and Isabel
Yaptinchay and in effect encouraged multiplicity of suits which is discouraged by this Court as
a reading of Cario shows; that Carioallows courts to pass on the determination of heirship
and the legitimacy or illegitimacy of a child so long as it is necessary to the determination of
the case; and that contrary to the appellate courts ruling, they had established their status as
compulsory heirs.

While the special proceeding was pending, Dy Tam and his purported siblings filed a civil
case before the same court, against the estate of Rafael Litam administrator Arminio Rivera
and Remedios R. Espiritu, duly appointed guardian of Marcosa. In their complaint, Dy Tam
and his purported siblings substantially reproduced the allegations made in his petition in the
special proceeding, with the addition of a list of properties allegedly acquired during the
marriage of the decedent and Marcosa.

In the main, the issue in the present petition is whether petitioners have to institute a special
proceeding to determine their status as heirs before they can pursue the case for annulment
of respondents Affidavit of Adjudication and of the TCT issued in her name.

Finding the issue raised in the civil case to be identical to some unresolved incidents in the
special proceeding, both were jointly heard by the trial court, following which it rendered a
decision in the civil case dismissing it, declaring, inter alia, that the plaintiffs Dy Tam et al. are
not the children of the decedent whose only surviving heir is Marcosa.

In the above-cited case of Heirs of Guido and Isabel Yaptinchay,26 the therein petitioners
executed on March 17, 1994 an extrajudicial settlement of the estate of the deceased Guido
and Isabel Yaptinchay, "owners-claimants" of the two lots mentioned therein. They later
discovered on August 26, 1994 that a portion, if not all, of the two lots had been titled in the
name of the therein respondent Golden Bay Realty and Development Corporation which in
turn sold portions thereof to the therein individual respondents. The therein
petitioners Heirs thus filed a complaint for annulment of titles. The therein respondents moved
to dismiss the case for failure of the therein petitioners to,inter alia, state a cause of action
and prove their status as heirs. The trial court granted the motion to dismiss in this wise:

On appeal to this Court by Dy Tam et al., one of the two issues raised for determination was
whether they are the legitimate children of Rafael Litam.
This Court, holding that the issue hinged on whether Rafael Litam and Sia Khin were married
in 1911, and whether Rafael Litam is the father of appellants Dy Tam et al., found
"substantially correct" the trial courts findings of fact and its conclusion that, among other
things, the birth certificates of Dy Tam et al. "do not establish the identity of the deceased
Rafael Litam and the persons named therein as father [and] it does not appear in the said
certificates of birth that Rafael Litam had in any manner intervened in the preparation and
filing thereof"; and that "[t]he other documentary evidence presented by [them] [is] entirely

But the plaintiffs who claimed to be the legal heirs of the said Guido and Isabel
Yaptinchay have not shown any proof or even a semblance of itexcept the allegations that

47

immaterial and highly insufficient to prove the alleged marriage between the deceased Rafael
Litam and Sia Khin and [their] alleged status . . . as children of said decedent."

delivery to her of the two lots alloted to her until after her complaint in the civil case had been
decided, set said case for trial.

This Court went on to opine in Litam, however, that "the lower court should not have
declared, in the decision appealed from, that Marcosa is the only heir of the decedent,
for such declaration is improper in the [civil case], it being within the exclusive competence of
the court in [the] [s]pecial [p]roceeding."

Juanita later filed in the civil case a motion to set aside the order setting it for trial on the
ground that in the amended complaint she, in the meantime, filed, she acknowledged the
partial legality and validity of the project of partition insofar as she was allotted the two lots,
the delivery of which she was seeking. She thus posited in her motion to set aside the April
27, 1966 order setting the civil case for hearing that there was no longer a prejudicial
question to her motion in the testate estate proceedings for the delivery to her of the actual
possession of the two lots. The trial court, by order of April 27, 1966, denied the motion.

In Solivio,31 also cited in Heirs of Guido and Isabel Yaptinchay, there was a special
proceeding for the settlement of the estate of the deceased, who was a soltero, filed before
the RTC of Iloilo. In the special proceeding, Branch 23 of said court declared as sole heir
Celedonia Solivio, the decedents maternal aunt-half sister of his mother. Concordia
Javellana-Villanueva, the decedents paternal aunt-sister of his father, moved to reconsider
the courts order declaring Celedonia Solivio as sole heir of the decedent, she claiming that
she too was an heir. The court denied the motion on the ground of tardiness. Instead of
appealing the denial of her motion, Concordia filed a civil case against Celedonia before the
same RTC, for partition, recovery of possession, ownership and damages. The civil case was
raffled to Branch 26 of the RTC, which rendered judgment in favor of Concordia. On appeal
by Celedonia, the appellate court affirmed the said judgment.

Juanita thereupon assailed the April 27, 1966 order before this Court.
The probate courts approval of the project of partition and directive that the records of the
case be sent to the archives notwithstanding, this Court held that the testate estate
proceedings had not been "legally terminated" as Juanitas share under the project of
partition had not been delivered to her. Explained this Court:
As long as the order of the distribution of the estate has not been complied with, the probate
proceedings cannot be deemed closed and terminated (Siguiong vs. Tecson, supra.);
because a judicial partition is not final and conclusive and does not prevent the heir from
bringing an action to obtain his share, provided the prescriptive period therefor has not elapse
(Mari vs. Bonilla, 83 Phil., 137). The better practice, however, for the heir who has not
received his share, is to demand his share through a proper motion in the same probate
or administration proceedings, or for re-opening of the probate or administrative
proceedings if it had already been closed, and not through an independent action, which
would be tried by another court or Judge which may thus reverse a decision or order
of the probate o[r] intestate court already final and executedand re-shuffle properties
long ago distributed and disposed of (Ramos vs. Ortuzar, 89 Phil. 730, 741-742; Timbol vs.
Cano, supra,; Jingco vs. Daluz, L-5107, April 24, 1953, 92 Phil. 1082; Roman Catholic vs.
Agustines, L-14710, March 29, 1960, 107 Phil., 455, 460-461). 34 (Emphasis and underscoring
supplied).

On petition for review filed before this Court by Celedonia who posed, among other issues,
"whether Branch 26 of the RTC of Iloilo had jurisdiction to entertain [the civil action] for
partition and recovery of Concordia Villanuevas share of the estate of [the deceased] while
the [estate] proceedings . . . were still pending . . . in Branch 23 of the same court," this Court
held that "[i]n the interest of orderly procedure and to avoid confusing and conflicting
dispositions of a decedents estate, a court should not interfere with [estate]
proceedingspending in a co-equal court," citing Guilas v. CFI Judge of Pampanga.32
This Court, however, in Solivio, upon "[c]onsidering that the estate proceedings are still
pending, but nonetheless [therein private respondent-Concordia Villanueva] had lost her right
to have herself declared as co-heir in said proceedings, opted to proceed to discuss the
merits of her claim in the interest of justice," and declared her an heir of the decedent.
In Guilas33 cited in Solivio, a project of partition between an adopted daughter, the therein
petitioner Juanita Lopez Guilas (Juanita), and her adoptive father was approved in
the proceedings for the settlement of the testate estate of the decedent-adoptive mother,
following which the probate court directed that the records of the case be archived.

This Court thus set aside the assailed April 27, 1966 order of the trial court setting the civil
case for hearing, butallowed the civil case to continue because it "involves no longer" the two
lots adjudicated to Juanita.
The common doctrine in Litam, Solivio and Guilas in which the adverse parties are putative
heirs to the estate of a decedent or parties to the special proceedings for its settlement is that
if the special proceedings are pending, or if there are no special proceedings filed but there
is, under the circumstances of the case, a need to file one, then the determination of, among
other issues, heirship should be raised and settled in said special proceedings. Where special
proceedings had been instituted but had been finally closed and terminated, however, or if a
putative heir has lost the right to have himself declared in the special proceedings as co-heir
and he can no longer ask for its re-opening, then an ordinary civil action can be filed for his

Juanita subsequently filed a civil action against her adoptive father to annul the project of
partition on the ground of lesion, preterition and fraud, and prayed that her adoptive father
immediately deliver to her the two lots allocated to her in the project of partition. She
subsequently filed a motion in the testate estate proceedings for her adoptive father to deliver
to her, among other things, the same two lots allotted to her.
After conducting pre-trial in the civil case, the trial court, noting the parties agreement to
suspend action or resolution on Juanitas motion in the testate estate proceedings for the

48

declaration as heir in order to bring about the annulment of the partition or distribution or
adjudication of a property or properties belonging to the estate of the deceased.
In the case at bar, respondent, believing rightly or wrongly that she was the sole heir to
Portugals estate, executed on February 15, 1988 35 the questioned Affidavit of Adjudication
under the second sentence of Rule 74, Section 1 of the Revised Rules of Court. 36 Said rule is
an exception to the general rule that when a person dies leaving a property, it should be
judicially administered and the competent court should appoint a qualified administrator, in
the order established in Sec. 6, Rule 78 in case the deceased left no will, or in case he did,
he failed to name an executor therein.37
Petitioners claim, however, to be the exclusive heirs of Portugal. A probate or intestate court,
no doubt, has jurisdiction to declare who are the heirs of a deceased.
It appearing, however, that in the present case the only property of the intestate estate of
Portugal is the Caloocan parcel of land, 38 to still subject it, under the circumstances of the
case, to a special proceeding which could be long, hence, not expeditious, just to establish
the status of petitioners as heirs is not only impractical; it is burdensome to the estate with the
costs and expenses of an administration proceeding. And it is superfluous in light of the fact
that the parties to the civil case subject of the present case, could and had already in fact
presented evidence before the trial court which assumed jurisdiction over the case upon the
issues it defined during pre-trial.
In fine, under the circumstances of the present case, there being no compelling reason to still
subject Portugals estate to administration proceedings since a determination of petitioners
status as heirs could be achieved in the civil case filed by petitioners, 39 the trial court should
proceed to evaluate the evidence presented by the parties during the trial and render a
decision thereon upon the issues it defined during pre-trial, which bear repeating, to wit:
1. Which of the two (2) marriages contracted by the deceased Jose Q. Portugal, is valid;
2. Which of the plaintiff, Jose Portugal Jr. and defendant Leonila P. Beltran is the legal heir of
the deceased Jose Q. Portugal (Sr.);
3. Whether or not TCT No. 159813 was issued in due course and can still be contested by
plaintiffs;
4. Whether or not plaintiffs are entitled to their claim under the complaint. 40
WHEREFORE, the petition is hereby GRANTED. The assailed September 24, 2002 Decision
of the Court of Appeals is hereby SET ASIDE.
Let the records of the case be REMANDED to the trial court, Branch 124 of the Regional Trial
Court of Caloocan City, for it to evaluate the evidence presented by the parties and render a
decision on the above-enumerated issues defined during the pre-trial.
No costs.
SO ORDERED.

49

On October 26, 2004, petitioners Avelina Abarientos Rebusquillo (Avelina) and Salvador
Orosco (Salvador) filed a Complaint for annulment and revocation of an Affidavit of SelfAdjudication dated December 4, 2001 and a Deed of Absolute Sale dated February 6, 2002
before the court a quo. In it, petitioners alleged that Avelina was one of the children of Eulalio
Abarientos (Eulalio) and Victoria Villareal (Victoria). Eulalio died intestate on July 3, 1964,
survived by his wife Victoria, six legitimate children, and one illegitimate child, namely: (1)
Avelina Abarientos-Rebusquillo, petitioner in this case; (2) Fortunata Abarientos-Orosco, the
mother of petitioner Salvador; (3) Rosalino Abarientos; (4) Juan Abarientos; (5) Feliciano
Abarientos; (6) Abraham Abarientos; and (7) Carlos Abarientos. His wife Victoria eventually
died intestate on June 30, 1983.
On his death, Eulalio left behind an untitled parcel of land in Legazpi City consisting of two
thousand eight hundred sixty-nine(2,869) square meters, more or less, which was covered by
Tax Declaration ARP No. (TD) 0141.
In 2001, Avelina was supposedly made to sign two (2) documents by her daughter Emelinda
Rebusquillo-Gualvez (Emelinda) and her son-in-law Domingo Gualvez (Domingo),
respondents in this case, on the pretext that the documents were needed to facilitate the
titling of the lot. It was only in 2003, so petitioners claim, that Avelina realized that what she
signed was an Affidavit of Self-Adjudication and a Deed of Absolute Sale in favor of
respondents.
As respondents purportedly ignored her when she tried to talk to them, Avelina sought the
intervention of the RTC to declare null and void the two (2) documents in order to reinstate
TD0141 and so correct the injustice done to the other heirs of Eulalio.

G.R. No. 204029

In their answer, respondents admitted that the execution of the Affidavit of Self-Adjudication
and the Deed of Sale was intended to facilitate the titling of the subject property. Paragraph 9
of their Answer reads:

June 4, 2014

Sometime in the year 2001, [petitioner] Avelina together with the other heirs of Eulalio
Abarientos brought out the idea to [respondent] Emelinda Rebusquillo-Gualvez to have the
property described in paragraph 8 of the complaint registered under the Torrens System of
Registration. To facilitate the titling of the property, so that the same could be attractive to
prospective buyers, it was agreed that the propertys tax declaration could be transferred to
[respondents] Spouses [Emelinda] R. Gualvez and Domingo Gualvez who will spend all the
cost of titling subject to reimbursement by all other heirs in case the property is sold; That it
was agreed that all the heirs will be given their corresponding shares on the property; That
pursuant to said purpose Avelina Abarientos-Rebusquillo with the knowledge and consent of
the other heirs signed and executed an Affidavit of Self-Adjudication and a Deed of Absolute
Sale in favor of [respondents] Gualvez. In fact, [petitioner] Avelina Rebusquillo was given an
advance sum of FIFTY THOUSAND PESOS (P50,000.00) by [respondent] spouses and all
the delinquent taxes paid by [respondents].3

AVELINA ABARIENTOS REBUSQUILLO [substituted by her heirs, except Emelinda R.


Gualvez]
and
SALVADOR
A.
OROSCO, Petitioners,
vs.
SPS. DOMINGO and EMELINDA REBUSQUILLO GUALVEZ and the CITY ASSESSOR OF
LEGAZPI CITY,Respondents.
DECISION
VELASCO, JR., J.:
Before Us is a Petition for Review on Certiorari under Rule 45 assailing the Decision 1 and
Resolution2 dated March 30, 2012 and September 25, 2012, respectively, of the Court of
Appeals (CA) in CA-G.R. CV No. 93035, which reversed and set aside the Decision dated
January 20, 2009 of the Regional Trial Court (RTC), Branch 4 in Legazpi City, in Civil Case
No. 10407.

After trial, the RTC rendered its Decision dated January 20, 2009 annulling the Affidavit of
Self-Adjudication and the Deed of Absolute Sale executed by Avelina on the grounds that (1)

The antecedent facts may be summarized as follows:

50

with regard to the Affidavit of Self-Adjudication, she was not the sole heir of her parents and
was not therefore solely entitled to their estate; and (2) in the case of the Deed of Absolute
Sale, Avelina did not really intend to sell her share in the property as it was only executed to
facilitate the titling of such property. The dispositive portion of the RTC Decision reads:

recourse to administration proceedings to determine who heirs are is sanctioned only if there
is a good and compelling reason for such recourse. 6 Hence, the Court had allowed
exceptions to the rule requiring administration proceedings as when the parties in the civil
case already presented their evidence regarding the issue of heirship, and the RTC had
consequently rendered judgment upon the issues it defined during the pre-trial. 7 In Portugal v.
Portugal-Beltran,8 this Court held:

WHEREFORE, premises considered, judgment is hereby rendered, as follows:


1. The subject Affidavit of Self-Adjudication of the Estate of the Deceased Spouses Eulalio
Abarientos and Victoria Villareal, dated December 4, 2001 as well as the subject Deed of
Absolute Sale, notarized on February 6, 2002, covering the property described in par. 8 of the
Amended Complaint are hereby ordered ANNULLED;

In the case at bar, respondent, believing rightly or wrongly that she was the sole heir to
Portugals 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.

2. That defendant City Assessors Officer of Legazpi City is hereby ordered to CANCEL the
Tax Declaration in the name of private [respondents] spouses Gualvez under ARP No. 4143
and to REINSTATE the Tax Declaration under ARP No. 0141 in the name of Eulalio
Abarientos;

Petitioners claim, however, to be the exclusive heirs of Portugal. A probate or intestate court,
no doubt, has jurisdiction to declare who are the heirs of a deceased.

3. By way of restitution, [petitioner] Avelina Abarientos Rebusquillo is hereby ordered to return


or refund to [respondents] spouses Domingo Gualvez and Emelinda Gualvez, the P50,000.00
given by the latter spouses to the former.4

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 civil case - subject of the present case, could and had already in fact
presented evidence before the trial court which assumed jurisdiction over the case upon the
issues it defined during pre-trial.

Assailing the trial courts decision, respondents interposed an appeal with the CA arguing that
the Deed of Sale cannot be annulled being a public document that has for its object the
creation and transmission of real rights over the immovable subject property. The fact that
Avelinas testimony was not offered in evidence, so respondents argued, the signature on the
adverted deed remains as concrete proof of her agreement to its terms. Lastly, respondents
contended that the Complaint filed by petitioners Avelina and Salvador before the RTC is not
the proper remedy provided by law for those compulsory heirs unlawfully deprived of their
inheritance.

In fine, under the circumstances of the present case, there being no compelling reason to still
subject Portugals estate to administration proceedings since a determination of petitioners
status as heirs could be achieved in the civil case filed by petitioners, the trial court should
proceed to evaluate the evidence presented by the parties during the trial and render a
decision thereon upon the issues it defined during pre-trial x x x. (emphasis supplied)

Pending the resolution of respondents appeal, Avelina died intestate on September 1, 2009
leaving behind several living heirs5 including respondent Emelinda.
In its Decision dated March 30, 2012, the appellate court granted the appeal and reversed
and set aside the Decision of the RTC. The CA held that the RTC erred in annulling the
Affidavit of Self-Adjudication simply on petitioners allegation of the existence of the heirs of
Eulalio, considering that issues on heirship must be made in administration or intestate
proceedings, not in an ordinary civil action. Further, the appellate court observed that the
Deed of Absolute Sale cannot be nullified as it is a notarized document that has in its favor
the presumption of regularity and is entitled to full faith and credit upon its face.

Similar to Portugal, in the present case, there appears to be only one parcel of land being
claimed by the contending parties as the inheritance from Eulalio. It would be more practical,
as Portugal teaches, to dispense with a separate special proceeding for the determination of
the status of petitioner Avelina as sole heir of Eulalio, especially in light of the fact that
respondents spouses Gualvez admitted in court that they knew for a fact that petitioner
Avelina was not the sole heir of Eulalio and that petitioner Salvador was one of the other
living heirs with rights over the subject land. As confirmed by the RTC in its Decision,
respondents have stipulated and have thereby admitted the veracity of the following facts
during the pre-trial:

Aggrieved by the CAs Decision, petitioner Avelina, as substituted by her heirs except
respondent Emelinda, and petitioner Salvador are now before this Court ascribing reversible
error on the part of the appellate court.
We find merit in the instant petition.

IV UNCONTROVERTED FACTS: (Based on the stipulation of facts in the Pre-Trial Order)

It has indeed been ruled that the declaration of heirship must be made in a special
proceeding, not in an independent civil action. However, this Court had likewise held that

A. x x x

51

B. [Petitioners] and private [respondents] spouses Gualvez admitted the following facts:
1. Identity of the parties;

whatever extent, over the property to respondents. Hence, the Deed of Absolute Sale is
nothing more than a simulated contract.

2. Capacity of the [petitioners] and private [respondents] to sue and be sued;

The Civil Code provides:

3. [Petitioner] Avelina Abarientos-Rebusquilllo is not the only surviving heir of deceased


spouses Eulalio and Victoria Abarientos;

Art. 1345. Simulation of a contract may be absolute or relative. The former takes place when
the parties do not intend to be bound at all; the latter, when the parties conceal their true
agreement. (emphasis supplied)

4. Petitioner Salvador Orosco is a co-owner/possessor of a portion of the subject property;

Art. 1346. An absolutely simulated or fictitious contract is void. A relative simulation, when it
does not prejudice a third person and is not intended for any purpose contrary to law, morals,
good customs, public order or public policy binds the parties to their real agreement.

5. Fortunata Abarientos-Orosco is the sister of Avelina Abarientos;


6. [Respondent] Emelinda Rebusquillo-Gualves is a daughter of [petitioner] Avelina A.
Rebusquillo;

In Heirs of Policronio Ureta Sr. v. Heirs of Liberato Ureta, 11 this Court explained the concept of
the simulation of contracts:

7. [Petitioner] Avelina Rebusquillo was born on Nov. 10, 1923;


8. The existence of Affidavit of Self-Adjudication of Estate of the Deceased and Deed of
Absolute Sale executed by [petitioner] Avelina A. Rebusquillo on the subject
property.9 (emphasis supplied)

In absolute simulation, there is a colorable contract but it has no substance as the parties
have no intention to be bound by it. The main characteristic of an absolute simulation is that
the apparent contract is not really desired or intended to produce legal effect or in any way
alter the juridical situation of the parties. As a result, an absolutely simulated or fictitious
contract is void, and the parties may recover from each other what they may have given
under the contract. However, if the parties state a false cause in the contract to conceal their
real agreement, the contract is relatively simulated and the parties are still bound by their real
agreement. Hence, where the essential requisites of a contract are present and the
simulation refers only to the content or terms of the contract, the agreement is absolutely
binding and enforceable between the parties and their successors in interest. (emphasis
supplied)

In light of the admission of respondents spouses Gualvez, it is with more reason that a resort
to special proceeding will be but an unnecessary superfluity. Accordingly, the court a quo had
properly rendered judgment on the validity of the Affidavit of Self-Adjudication executed by
Avelina. As pointed out by the trial court, an Affidavit of Self-Adjudication is only proper when
the affiant is the sole heir of the decedent. The second sentence of Section 1, Rule 74 of the
Rules of Court is patently clear that self-adjudication is only warranted when there is only one
heir:
Section 1. Extrajudicial settlement by agreement between heirs. x x x If there is only one
heir, he may adjudicate to himself the entire estate by means of an affidavit filed in the office
of the register of deeds. x x x (emphasis supplied)

In the present case, the true intention of the parties in the execution of the Deed of Absolute
Sale is immediately apparent from respondents very own Answer to petitioners Complaint.
As respondents themselves acknowledge, the purpose of the Deed of Absolute Sale was
simply to "facilitate the titling of the [subject] property," not to transfer the ownership of the lot
to them. Furthermore, respondents concede that petitioner Salvador remains in possession of
the property and that there is no indication that respondents ever took possession of the
subject property after its supposed purchase. Such failure to take exclusive possession of the
subject property or, in the alternative, to collect rentals from its possessor, is contrary to the
principle of ownership and is a clear badge of simulation that renders the whole transaction
void.12

As admitted by respondents, Avelina was not the sole heir of Eulalio. In fact, as admitted by
respondents, petitioner Salvador is one of the co-heirs by right of representation of his
mother. Without a doubt, Avelina had perjured herself when she declared in the affidavit that
she is "the only daughter and sole heir of spouses EULALIO ABARIENTOS AND VICTORIA
VILLAREAL."10 The falsity of this claim renders her act of adjudicating to herself the
inheritance left by her father invalid. The RTC did not, therefore, err in granting Avelinas
prayer to declare the affidavit null and void and so correct the wrong she has committed.
In like manner, the Deed of Absolute Sale executed by Avelina in favor of respondents was
correctly nullified and voided by the RTC. Avelina was not in the right position to sell and
transfer the absolute ownership of the subject property to respondents. As she was not the
sole heir of Eulalio and her Affidavit of Self-Adjudication is void, the subject property is still
subject to partition. Avelina, in fine, did not have the absolute ownership of the subject
property but only an aliquot portion. What she could have transferred to respondents was
only the ownership of such aliquot portion. It is apparent from the admissions of respondents
and the records of this case that Avelina had no intention to transfer the ownership, of

Contrary to the appellate courts opinion, the fact that the questioned Deed of Absolute Sale
was reduced to writing and notarized does not accord it the quality of incontrovertibility
otherwise provided by the parole evidence rule. The form of a contract does not make an
otherwise simulated and invalid act valid. The rule on parole evidence is not, as it were,
ironclad. Sec. 9, Rule 130 of the Rules of Court provides the exceptions:
Section 9. Evidence of written agreements. x x x

52

However, a party may present evidence to modify, explain or add to the terms of written
agreement if he puts in issue in his pleading:

INVENTARIO

(a) An intrinsic ambiguity, mistake or imperfection in the written agreement;

rreno, con sus mejoras y edificaciones, situadoen

(b) The failure of the written agreement to express the true intent and agreement of the
parties thereto;

la Escolta, Manila............................................................. P500,000.00

(c) The validity of the written agreement; or

parcelas de terreno situadas en Antipolo, Rizal................... 658.34

(d) The existence of other terms agreed to by the parties or their successors in interest after
the execution of the written agreement.

Cuatrocientos noventa y uno (491) acciones

Una sexta parte (1/6) proindiviso de un te

Una sexta parte (1/6) proindiviso de dos

de la 'Central Azucarera de la Carlota a P17.00

The term "agreement" includes wills. (emphasis supplied)

por accion ................................................................................8,347.00

The failure of the Deed of Absolute Sale to express the true intent and agreement of the
contracting parties was clearly put in issue in the present case. Again, respondents
themselves admit in their Answer that the Affidavit of Self-Adjudication and the Deed of
Absolute Sale were only executed to facilitate the titling of the property. The RTC is,
therefore, justified to apply the exceptions provided in the second paragraph of Sec. 9, Rule
130 to ascertain the true intent of the parties, which shall prevail over the letter of the
document. That said, considering that the Deed of Absolute Sale has been shown to be void
for being absolutely simulated, petitioners are not precluded from presenting evidence to
modify, explain or add to the terms of the written agreement. 13

Diez mil ochocientos seize (10,806) acciones


de la 'Central Luzon Milling Co.', disuelta y en
liquidacion a P0.15 por accion ..............................................1,620.90
Cuenta de Ahorros en el Philippine Trust
Co.............................................................................................. 2,350.73
TOTAL.............................................................. P512,976.97
MENOS:
Deuda al Banco de las Islas Filipinas, garan-

WHEREFORE, the instant petition is GRANTED.

tizada con prenda de las acciones de La Carlota ......... P 5,000,00


VALOR LIQUIDO........................................... P507,976.97

G.R. No. L-27952 February 15, 1982

The testamentary dispositions are as follows:

TESTATE ESTATE OF JOSE EUGENIO RAMIREZ, MARIA LUISA PALACIOS,


Administratrix, petitioner-appellee,
vs.
MARCELLE D. VDA. DE RAMIREZ, ET AL., oppositors, JORGE and ROBERTO
RAMIREZ, legatees, oppositors- appellants.

A.En nuda propiedad, a D. Roberto y D. Jorge Ramirez, ambas menores de edad,


residentes en Manila, I.F., calle 'Alright, No. 1818, Malate, hijos de su sobrino D. Jose Ma.
Ramirez, con sustitucion vulgar a favor de sus respectivos descendientes, y, en su defecto,
con sustitucion vulgar reciprocal entre ambos.
El precedente legado en nuda propiedad de la participacion indivisa de la finca Santa Cruz
Building, lo ordena el testador a favor de los legatarios nombrados, en atencion a que dicha
propiedad fue creacion del querido padre del otorgante y por ser aquellos continuadores del
apellido Ramirez,

ABAD SANTOS, J.:


The main issue in this appeal is the manner of partitioning the testate estate of Jose Eugenio
Ramirez among the principal beneficiaries, namely: his widow Marcelle Demoron de Ramirez;
his two grandnephews Roberto and Jorge Ramirez; and his companion Wanda de Wrobleski.

B.Y en usufructo a saber:


a. En cuanto a una tercera parte, a favor de la esposa del testador, Da. Marcelle Ramirez,
domiciliada en IE PECO, calle del General Gallieni No. 33, Seine Francia, con sustitucion
vulgar u fideicomisaria a favor de Da. Wanda de Wrobleski, de Palma de Mallorca, Son
Rapina Avenida de los Reyes 13,

The task is not trouble-free because the widow Marcelle is a French who lives in Paris, while
the companion Wanda is an Austrian who lives in Spain. Moreover, the testator provided for
substitutions.
Jose Eugenio Ramirez, a Filipino national, died in Spain on December 11, 1964, with only his
widow as compulsory heir. His will was admitted to probate by the Court of First Instance of
Manila, Branch X, on July 27, 1965. Maria Luisa Palacios was appointed administratrix of the
estate. In due time she submitted an inventory of the estate as follows:

b.Y en cuanto a las dos terceras partes restantes, a favor de la nombrada Da. Wanda de
Nrobleski con sustitucion vulgar v fideicomisaria a saber:

53

En cuanto a la mitad de dichas dos terceras partes, a favor de D. Juan Pablo Jankowski, de
Son Rapina Palma de Mallorca; y encuanto a la mitad restante, a favor de su sobrino, D.
Horace V. Ramirez, San Luis Building, Florida St. Ermita, Manila, I.F.

2. The substitutions.
It may be useful to recall that "Substitution is the appoint- judgment of another heir so that he
may enter into the inheritance in default of the heir originally instituted." (Art. 857, Civil Code.
And that there are several kinds of substitutions, namely: simple or common, brief or
compendious, reciprocal, and fideicommissary (Art. 858, Civil Code.) According to Tolentino,
"Although the Code enumerates four classes, there are really only two principal classes of
substitutions: the simple and the fideicommissary. The others are merely variations of these
two." (111 Civil Code, p. 185 [1973].)

A pesar de las sustituciones fideiconiisarias precedentemente ordinadas, las usufiructuarias


nombradas conjuntamente con los nudo propietarios, podran en cualquier memento vender a
tercero los bienes objeto delegado, sin intervencion alguna de los titulares fideicomisaarios.
On June 23, 1966, the administratrix submitted a project of partition as follows: the property
of the deceased is to be divided into two parts. One part shall go to the widow 'en pleno
dominio" in satisfaction of her legitime; the other part or "free portion" shall go to Jorge and
Roberto Ramirez "en nuda propriedad." Furthermore, one third (1/3) of the free portion is
charged with the widow's usufruct and the remaining two-thirds (2/3) with a usufruct in favor
of Wanda.

The simple or vulgar is that provided in Art. 859 of the Civil Code which reads:
ART. 859. The testator may designate one or more persons to substitute the heir or heirs
instituted in case such heir or heirs should die before him, or should not wish, or should be
incapacitated to accept the inheritance.

Jorge and Roberto opposed the project of partition on the grounds: (a) that the provisions for
vulgar substitution in favor of Wanda de Wrobleski with respect to the widow's usufruct and in
favor of Juan Pablo Jankowski and Horacio V. Ramirez, with respect to Wanda's usufruct are
invalid because the first heirs Marcelle and Wanda) survived the testator; (b) that the
provisions for fideicommissary substitutions are also invalid because the first heirs are not
related to the second heirs or substitutes within the first degree, as provided in Article 863 of
the Civil Code; (c) that the grant of a usufruct over real property in the Philippines in favor of
Wanda Wrobleski, who is an alien, violates Section 5, Article III of the Philippine Constitution;
and that (d) the proposed partition of the testator's interest in the Santa Cruz (Escolta)
Building between the widow Marcelle and the appellants, violates the testator's express win
to give this property to them Nonetheless, the lower court approved the project of partition in
its order dated May 3, 1967. It is this order which Jorge and Roberto have appealed to this
Court.

A simple substitution, without a statement of the cases to which it refers, shall comprise the
three mentioned in the preceding paragraph, unless the testator has otherwise provided.
The fideicommissary substitution is described in the Civil Code as follows:
ART. 863. A fideicommissary substitution by virtue of which the fiduciary or first heir instituted
is entrusted with the obligation to preserve and to transmit to a second heir the whole or part
of inheritance, shall be valid and shall take effect, provided such substitution does not go
beyond one degree from the heir originally instituted, and provided further that the fiduciary or
first heir and the second heir are living at time of the death of the testator.
It will be noted that the testator provided for a vulgar substitution in respect of the legacies of
Roberto and Jorge Ramirez, the appellants, thus: con sustitucion vulgar a favor de sus
respectivos descendientes, y, en su defecto, con substitution vulgar reciprocal entre ambos.
The appellants do not question the legality of the substitution so provided. The appellants
question the sustitucion vulgar y fideicomisaria a favor de Da. Wanda de Wrobleski" in
connection with the one-third usufruct over the estate given to the widow Marcelle However,
this question has become moot because as We have ruled above, the widow is not entitled to
any usufruct.

1. The widow's legitime.


The appellant's do not question the legality of giving Marcelle one-half of the estate in full
ownership. They admit that the testator's dispositions impaired his widow's legitime. Indeed,
under Art. 900 of the Civil Code "If the only survivor is the widow or widower, she or he shall
be entitled to one-half of the hereditary estate." And since Marcelle alone survived the
deceased, she is entitled to one-half of his estate over which he could impose no burden,
encumbrance, condition or substitution of any kind whatsoever. (Art. 904, par. 2, Civil Code.)

The appellants also question the sustitucion vulgar y fideicomisaria in connection with
Wanda's usufruct over two thirds of the estate in favor of Juan Pablo Jankowski and Horace
v. Ramirez.
They allege that the substitution in its vulgar aspect as void because Wanda survived the
testator or stated differently because she did not predecease the testator. But dying before
the testator is not the only case for vulgar substitution for it also includes refusal or incapacity
to accept the inheritance as provided in Art. 859 of the Civil Code, supra. Hence, the vulgar
substitution is valid.

It is the one-third usufruct over the free portion which the appellants question and justifiably
so. It appears that the court a quo approved the usufruct in favor of Marcelle because the
testament provides for a usufruct in her favor of one-third of the estate. The court a quo erred
for Marcelle who is entitled to one-half of the estate "en pleno dominio" as her legitime and
which is more than what she is given under the will is not entitled to have any additional share
in the estate. To give Marcelle more than her legitime will run counter to the testator's
intention for as stated above his dispositions even impaired her legitime and tended to favor
Wanda.

As regards the substitution in its fideicommissary aspect, the appellants are correct in their
claim that it is void for the following reasons:

54

(a) The substitutes (Juan Pablo Jankowski and Horace V. Ramirez) are not related to Wanda,
the heir originally instituted. Art. 863 of the Civil Code validates a fideicommissary substitution
"provided such substitution does not go beyond one degree from the heir originally instituted."

IN VIEW OF THE FOREGOING, the estate of Jose Eugenio Ramirez is hereby ordered
distributed as follows:

What is meant by "one degree" from the first heir is explained by Tolentino as follows:

One-half (1/2) thereof which is the free portion to Roberto and Jorge Ramirez in naked
ownership and the usufruct to Wanda de Wrobleski with a simple substitution in favor of Juan
Pablo Jankowski and Horace V. Ramirez.

One-half (1/2) thereof to his widow as her legitime;

Scaevola Maura, and Traviesas construe "degree" as designation, substitution, or


transmission. The Supreme Court of Spain has decidedly adopted this construction. From this
point of view, there can be only one tranmission or substitution, and the substitute need not
be related to the first heir. Manresa, Morell and Sanchez Roman, however, construe the word
"degree" as generation, and the present Code has obviously followed this interpretation. by
providing that the substitution shall not go beyond one degree "from the heir originally
instituted." The Code thus clearly indicates that the second heir must be related to and be
one generation from the first heir.

The distribution herein ordered supersedes that of the court a quo. No special
pronouncement as to costs.
SO ORDERED.
Barredo (Chairman), Concepcion, Jr., De Castro, Ericta and Escolin, JJ., concur.
Aquino J., took no part.

From this, it follows that the fideicommissary can only be either a child or a parent of the first
heir. These are the only relatives who are one generation or degree from the fiduciary (Op.
cit., pp. 193-194.)
(b) There is no absolute duty imposed on Wanda to transmit the usufruct to the substitutes as
required by Arts. 865 and 867 of the Civil Code. In fact, the appellee admits "that the testator
contradicts the establishment of a fideicommissary substitution when he permits the
properties subject of the usufruct to be sold upon mutual agreement of the usufructuaries and
the naked owners." (Brief, p. 26.)
3. The usufruct of Wanda.
The appellants claim that the usufruct over real properties of the estate in favor of Wanda is
void because it violates the constitutional prohibition against the acquisition of lands by
aliens.
The 1935 Constitution which is controlling provides as follows:
SEC. 5. Save in cases of hereditary succession, no private agricultural land shall be
transferred or assigned except to individuals, corporations, or associations qualified to
acquire or hold lands of the public domain in the Philippines. (Art. XIII.)
The court a quo upheld the validity of the usufruct given to Wanda on the ground that the
Constitution covers not only succession by operation of law but also testamentary
succession. We are of the opinion that the Constitutional provision which enables aliens to
acquire private lands does not extend to testamentary succession for otherwise the
prohibition will be for naught and meaningless. Any alien would be able to circumvent the
prohibition by paying money to a Philippine landowner in exchange for a devise of a piece of
land.
This opinion notwithstanding, We uphold the usufruct in favor of Wanda because a usufruct,
albeit a real right, does not vest title to the land in the usufructuary and it is the vesting of title
to land in favor of aliens which is proscribed by the Constitution.

55

Defendant's defense was that Consolacion Florentino was a mere usufructuary of, and not
owner of one-half pro-indiviso of the property in question, and that, therefore, she was not
entitled to demand partition thereof.
After trial upon the issue thus posed, the lower court rendered judgment as follows:
1. Declaring that the plaintiff is a co-owner pro-indiviso with the defendant of the house and
lot described in the complaint to the extent of each of an undivided 1/2 portion thereof; .
2. Ordering the aforesaid co-owners to execute an agreement of partition of the said property
within 30 days from receipt of this judgment unless it be shown that the division thereof may
render it unserviceable, in which case the provisions of Art. 498 of the New Civil Code may be
applied; .1wph1.t
3. That in the event the said parties shall fail to do so, this Court will appoint the
corresponding commissioners to make the partition in accordance with law; and .
4. Without special pronouncement as to costs." .
From the above judgment, defendant Singson appealed.

G.R. No. L-13876

It is admitted that Da. Leona Singson, who died single on January 13, 1948, was the owner
of the property in question at the time of her death. On July 31, 1951 she executed her last
will which was admitted to probate in Special Proceeding No. 453 of the lower court whose
decision was affirmed by the Court of Appeals in G.R. No. 3605-R. At the time of the
execution of the will, her nearest living relatives were her brothers Evaristo, Manuel and
Dionisio Singson, her nieces Rosario, Emilia and Trinidad, and her grandniece Consolation,
all surnamed Florentino.

February 28, 1962

CONSOLACION FLORENTINO DE CRISOLOGO,


vs.
DR. MANUEL SINGSON, defendant-appellant.
Felix
V.
Vergara
B. Martinez for plaintiffs-appellees.

for

ET

Clause IX of her last will reads as follows: .

AL., plaintiffs-appellees,

NOVENO. Ordeno que se de a mi nieta por parte de mi hermana mia y que al mismo
tiempo vive en mi casa, y, por tanto, bajo mi proteccion, y es la CONSOLACION
FLORENTINO:

defendant-appellant.

(A). La mitad de mi casa de materials fuertes con techo de hierro galvanizado, incluyendo la
mitad de su solar, ubicado en la Poblacion de Vigan, Ilocos Sur, Calle Plaridel, actualmente
arrendada por los hermanos Fortunato, Teofilo y Pedro del appellido Kairuz. Pero si falleciere
antes o despues que yo mi citada nieta, esta propiedad se dara por partes iguales entre mis
tres hermanos Evaristo, Manuel y Dionisio, o a sus herederos forzosos en el caso de que
alguno de ellas murieie antes ... (Exhibit F.)

DIZON, J.:
Action for partition commenced by the spouses Consolacion Florentino and Francisco
Crisologo against Manuel Singson in connection with a residential lot located a Plaridel St.,
Vigan, Ilocos Sur, with an area of approximately 193 square meters, and the improvements
existing thereon, covered by Tax No. 10765-C. Their complaint alleged that Singson owned
one-half pro-indiviso of said property and that Consolacion Florentino owned the other half by
virtue of the provisions of the duly probated last will of Da. Leona Singson, the original
owner, and the project of partition submitted to, and approved by the Court of First Instance of
Ilocos Sur in special Proceeding No. 453; that plaintiffs had made demands for the partition of
said property, but defendant refused to accede thereto, thus compelling them to bring action.

The issue to be decided is whether the testamentary disposition above-quoted provided for
what is calledsustitucion vulgar or for a sustitucion fideicomisaria. This issue is, we believe,
controlled by the pertinent provisions of the Civil Code in force in the Philippines prior to the
effectivity of the New Civil Code, in view of the fact that the testatrix died on January 13,
1948. They are the following: .
Art. 774. The testator may designate one or more persons to substitute the heir or heirs
instituted in case such heir or heirs should die before him, or should not wish or should be
unable to accept the inheritance.

56

A simple substitution, without a statement of the cases to which it is to apply, shall include the
three mentioned in the next preceeding paragraph, unless the testator has otherwise
provided:

name, or by imposing upon the first heir the absolute obligation ("obligacion terminante") to
deliver the inheritance to a substitute or second heir. In this connection Manresa says: .

Art. 781. Fidei-commissary substitutions by virtue of which the heir is charged to preserve
and transmit to a third person the whole or part of the inheritance shall be valid and effective,
provided they do not go beyond the second degree, or that they are made in favor of persons
living at the time of the death of the testator." .

Para que la sustitucion sea fideicomisaria, es preciso segun el art. 781, que se ordeno o
encargue al primer heredero, cuando sea tal, que conserve y transmita a una tercera
persona o entidad el todo a parte de la herencia. O lo que es lo mismo, la sustitucion
fideicomisaria, como declaran las resoluciones de 25 de Junio de 1895, 10 de Febrero de
1899 y 19 de Julio de 1909, exige tres requisitos: .

Art. 785. The following shall be inoperative: .

1.o Un primer heredero llamado al goce de los bienes preferentemente.

1. Fiduciary substitutions not made expressly, either by giving them this name or by imposing
upon the fiduciary the absolute obligation of delivering the property to a second heir." ....

2.o Obligacion claramente impuesta al mismo de conservar y transmitir a un tercero el todo o


parte del caudal.

In accordance with the first legal provision quoted above, the testator may not only designate
the heirs who will succeed him upon his death, but also provide for substitutes in the event
that said heirs do not accept or are in no position to accept the inheritance or legacies, or die
ahead of him.

3.o Un segundo heredero.

The testator may also bequeath his properties to a particular person with the obligation, on
the part of the latter, to deliver the same to another person, totally or partially, upon the
occurrence of a particular event (6 Manresa, p. 1112).

Por tanto, cuando el causante se limita a instituir dos herederos, y por fallecimiento de
ambos o de cualquiera de ellos, asigna la parte del fallecido o fallecidos, a los herederos
legitimos o a otras personas, solo existe una sustitucion vulgar, porque falta el requisito de
haberse impuesto a los primeros herederos la obligacion de conservar y transmitir los bienes,
y el articulo 789, en su parrafo primero, evige que la sustitucion sea expresa, ya dandole el
testador el nombre de sustitucion fideicomisaria, ya imponiendo al sustituido la obligacion
terminante de conservar y transmitir los bienes a un segundo heredero.

A estos requisitos anade la sentencia de 18 de Noviembre de 1918, otro mas, el del que el
fideicomisario tenga derecho a los bienes de la herencia desde el momento de la muerte del
testador, puesto que ha de suceder a este y no al fiduciario.

It is clear that the particular testamentary clause under consideration provides for a
substitution of the heir named therein in this manner: that upon the death of Consolacion
Florentino whether this occurs before or after that of the testatrix the property
bequeathed to her shall be delivered ("se dara") or shall belong in equal parts to the
testatrix's three brothers, Evaristo, Manuel and Dionisio, or their forced heirs, should anyone
of them die ahead of Consolacion Florentino. If this clause created what is known
as sustitucion vulgar, the necessary result would be that Consolacion Florentino, upon the
death of the testatrix, became the owner of one undivided half of the property, but if it
provided for a sustitution fideicomisaria, she would have acquired nothing more than
usufructuary rights over the same half. In the former case, she would undoubtedly be entitled
to partition, but not in the latter. As Manresa says, if the fiduciary did not acquire full
ownership of the property bequeathed by will, but mere usufructuary rights thereon until the
time came for him to deliver said property to the fideicomisario, it is obvious that the nude
ownership over the property, upon the death of the testatrix, passed to and was acquired by
another person, and the person cannot be other than the fideicomisario (6 Manresa p. 145).

A careful perusal of the testamentary clause under consideration shows that the substitution
of heirs provided for therein is not expressly made of the fideicommissary kind, nor does it
contain a clear statement to the effect that appellee, during her lifetime, shall only enjoy
usufructuary rights over the property bequeathed to her, naked ownership thereof being
vested in the brothers of the testatrix. As already stated, it merely provides that upon
appellee's death whether this happens before or after that of the testatrix her share
shall belong to the brothers of the testatrix.
In the light of the foregoing, we believe, and so hold, that the last will of the deceased Da.
Leona Singson, established a mere sustitucion vulgar, the substitution Consolacion Florentino
by the brothers of the testatrix to be effective or to take place upon the death of the former,
whether it happens before or after that of the testatrix.

It seems to be of the essence of a fideicommissary substitution that an obligation be clearly


imposed upon the first heir to preserve and transmit to another the whole or part of the estate
bequeathed to him, upon his death or upon the happening of a particular event. For this
reason, Art. 785 of the old Civil Code provides that a fideicommissary substitution shall have
no effect unless it is made expressly ("de una manera expresa") either by giving it such

IN VIEW OF THE FOREGOING, the appealed judgment is affirmed, with costs.


Bengzon, C.J., Padilla, Bautista Angelo, Labrador, Concepcion, Reyes, J.B.L., Barrera,
Paredes and De Leon, JJ., concur.

57

You might also like