BONDS OF GUARDIANS

Similar to an administrator or executor, the appointed guardian may be

required to post a bond before he enters upon the execution of his trust, or
letters of guardianship.
The purpose of the bond is for the protection of the property of the minor or
incompetent to the end that he may be assured of an honest administration of
funds.
Rule 94
Section 1. Bond to be given before issuance of letters. Amount. Conditions.
Before a guardian appointed enters upon the execution of his trust, or letter of
guardianship issue, he shall give a bond, in such sum as the court directs,
conditioned as follows:
a. to make and return to the court, within three (3) months, a true and complete
inventory of all the estate, real and personal, of his ward which shall come to his
possession or knowledge or to the possession or knowledge of any other person
for him;
b. to faithfully execute the duties of his trust, to manage and dispose of the estate
according to these rules for the best interest of the ward, and to provide for the
proper care, custody, and education of the ward;
c. to render a true and just account of all the estate of the ward in his hands, and of
all proceeds or interest derived therefrom, and of the management and disposition
of the same, at the time designated by these rules and such other times as the court
directs, and at the expiration of his trust to settle his accounts with the court and
deliver and pay over all the estate, effects, and moneys remaining in his hands, or
due from him on such settlement, to the person lawfully entitled thereto;
d. to perform all orders of the court by him to be performed.

The conditions are the following (IFA2P):

1. To file with the court a complete INVENTORY of the estate of the ward
within three (3) months;
2. To FAITHFULLY execute the duties of his trust to manage and dispose
of the estate according to the Rules for the best interest of the ward, and to
provide for the proper care, custody and education of the ward;

3.To render true ACCOUNT of all the estate and of the management and
disposition of the same;
4. To settle his ACCOUNT with the court and deliver over all the estate in
his hands to the person entitled thereto; and
5. To PERFORM all orders of the court by him to be performed.
The above-mentioned conditions are the same conditions imposed on
administrators and executors except that there is no provision on the
settlement of debts because we do not settle debts in guardianship.
When required by statutes to give a bond, no person can qualify and act as
guardian without complying with the condition precedent.

General Rule: If the guardian of the minor is his parent, Article 225 of the
Family Code shall govern regarding legal guardianship over the property of
their unemancipated common child without necessity of a court
appointment.
Article 225 of the Family Code
Article 225. The father and the mother shall jointly exercise legal
guardianship over the property of their unemancipated common
child without the necessity of a court appointment. In case of
disagreement, the fathers decision shall prevail, unless there is a
judicial order to the contrary.
Where the market value of the property or the annual income of the
child exceeds P50, 000.00, the parent concerned shall required to
furnish a bond in such amount as the court may determine, but not
less than ten per centum (10%) of the value of the property or
annual income, to guarantee the performance of the obligations
prescribed for general guardians.
A verified petition for approval of the bond shall be filed in the
proper court of the place where the child resides or if the child
resides in a foreign country, in the proper court of the place where
the property or any part thereof is situated.

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The petition shall be docketed as summary special proceedings in
which all incidents and issues regarding the performance of the
obligations referred to in the second paragraph of this Article shall
be heard and resolved.
The ordinary rules on guardianship shall be merely suppletory
except when the child is under substitute parental authority, or the
guardian is a stranger, or a parent has remarried, in which case the
ordinary rules on guardianship shall apply.

It provides that if the property of the minor or incompetent is only P50,

000.00 or less, there is no need to furnish a bond. However, if the property
or the annual income of the minor or incompetent exceeds P50, 000.00, the
court must have control. The parent must put up a bond first and seek the
authority of the court through a Summary Special Proceeding under the
Family Code.

It is called summary because it involves only the putting up and the

approval of the bond. The rules on guardianship shall be applied in a
suppletory manner.

Exception: if the child is under substitute parental authority or the

guardian is a stranger, or a parent has remarried, the ordinary rules on
guardianship shall apply.
Rule on Guardianship of Minors
A.M. No. 03-02-05-SC (April 1, 2003)
Section 16. Bond of parents as guardians of property of minor.
- If the market value or the annual income of the child exceeds
P50, 000.00, the parent concerned shall furnish a bond in such
amount as the court may determine, but in no case less than ten per
centum (10%) of the value of such property or annual income, to
guarantee the performance of the obligations prescribed for general
guardians.
A verified petition for approval of the bond shall be filed in the
Family Court of the place where the child resides or, if the child
resides in a foreign country, in the Family Court of the place where
the property or any part thereof is situated.

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The petition shall be docketed as a summary special proceedings in
which all incidents and issues regarding the performance of the
obligations of a general guardian shall be heard and resolved.
Rule on Guardianship of Minors
A.M. No. 03-02-05-SC (April 1, 2003)
Section 14. Bond of guardian; amount; conditions. - Before he
enters upon the execution of his trust, or letter of guardianship
issue, an appointed guardian may be required to post a bond in
such sum as the court shall determine and conditioned as follows:
a. to make and return to the court, within three (3) months, a true
and complete inventory of all the property, real and personal, of his
ward which shall come to his possession or knowledge or to the
possession or knowledge of any other person in his behalf;
b. to faithfully execute the duties of his trust, to manage and
dispose of the property according to this rule for the best interests
of the ward, and to provide for the proper care, custody, and
education of the ward;
c. to render a true and just account of all the property of the ward
in his hands, and of all proceeds or interest derived therefrom, and
of the management and disposition of the same, at the time
designated by this rules and such other times as the court directs;
and at the expiration of his trust, to settle his accounts with the
court and deliver and pay over all the property, effects, and monies
remaining in his hands, or due from him in such settlement, to the
person lawfully entitled thereto; and
d. to perform all orders of the court and such other duties as may
be required by law.

RULE 94

Section 2. When new bond may be required and old sureties discharged.
Whenever it is deemed necessary, the court may require a new bond to be given
by the guardian, and may discharge the sureties on the old bond from further
liability, after due notice to interested persons, when no injury can result
therefrom to those interested in the estate.

ADDITIONAL BOND:

The court may also require the guardian to file an additional bond.

The court may accept a new bond from a guardian who has already given a
bond, to require additional security where such a course seems proper for the
protection of the wards estate. This power to require new or additional
security is sometimes given by statute but has been held to exist
independently of any statutory provision.

It is the right and duty of the court to require additional security where the
bond given is insufficient. A new bond may also be required when the
guardian is about to receive funds not in contemplation when the original
bond was executed and should be given as a condition of the payment of a
legacy or distributive share to the guardian when there is any express
statutory requirement to that effect.

DURATION OF LIABILITY

The bond of the guardian is a continuing one against the obligors and their
estates until all of the conditions are fulfilled. The mere fact that defendant
was removed as guardian did not relieve his or her bondsmen when there is
any express statutory requirement to that effect.

RIGHT OF SURETY

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The sureties of a guardian against whom judgment has been entered, may
demand the benefit of levy (exclusion) of the principals property, even
when judgment is rendered against both surety and principal. But to do so,
they must point out property subject to seizure in an amount sufficient to
satisfy debt.

RULE 94

Section 3. Bonds to be filed. Actions thereon. Every bond given by a

guardian shall be filed in the office of the clerk of the court, and, in case of the
breach of a condition thereof, may be prosecuted in the same proceeding or in a
separate action for the use and benefit of the ward or of any other person legally
interested in the estate.

Rule on Guardianship of Minors

A.M. No. 03-02-05-SC (April 1, 2003)
SECTION 15. Where to File the Bond; Action Thereon. The
bond posted by a guardian shall be filed in the Family Court and,
in case of breach of any of its conditions, the guardian may be
prosecuted in the same proceeding for the benefit of the ward or of
any other person legally interested in the property.

The Bonds filed in the Office of the Clerk of Court and in case of minors in
the Family Court.
The guardian may be prosecuted in the same guardianship proceeding or in a
separate action for violating the conditions of his bond. For guardianship of
minors, the action should be filed in the same guardianship proceeding to
achieve speedy disposition of the proceeding and to prevent multiplicity of
suits.
SELLING AND ENCUMBERING PROPERTY OF WARD
RULE 95

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SECTION 1. Petition of guardian for leave to sell or encumber estate.
When the income of an estate under guardianship is insufficient to maintain the
ward and his family, or to maintain and educate the ward when a minor, or when it
appears that it is for the benefit of the ward that his real estate or some part
thereof be sold, or mortgaged or otherwise encumbered, and the proceeds thereof
put out at interest, or invested in some productive security, or in the improvement
or security of other real estate of the ward, the guardian may present a verified
petition to the court by which he was appointed setting forth such facts, and
praying that an order issue authorizing the sale or encumbrance.
Rule on Guardianship of Minors
A.M. No. 03-02-05-SC (April 1, 2003)
SECTION 19. Petition to Sell or Encumber Property. When
the income of a property under guardianship is insufficient to
maintain and educate the ward, or when it is for his benefit that his
personal or real property or any part thereof be sold, mortgaged or
otherwise encumbered, and the proceeds invested in safe and
productive security, or in the improvement or security of other real
property, the guardian may file a verified petition setting forth such
facts, and praying that an order issue authorizing the sale or
encumbrance of the property.

Same as in settlement of the estate of the deceased person, the remedy of a

guardian, if the income of the property of the ward is not sufficient to
maintain the ward and his family, the guardian shall file a petition for lease,
sale or encumbrance of the estates of the minor.

Also, same with the procedure in the administration of settlement of estate

proceedings, a guardian must file a petition to obtain court approval.
Because as a guardian, administrator or trustee, he is an officer of the court
and anything that he do especially if it involves sale or encumbrance of the
estate of the ward, he must have to seek prior court approval

WHAT ARE THE GROUNDS IF YOU WANT TO FILE A PETITION?

(IBI)
1. When the income of the estate is INSUFFICIENT to main the ward and
his family;
2. When it appears that it is for the BENEFIT of the ward;

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3. IMPROVEMENT or security of other real property
RULE 95
SECTION 2. Order to show cause thereupon. If it seems probable that such
sale or encumbrance is necessary, or would be beneficial to the ward, the court
shall make an order directing the next of kin of the ward, and all persons
interested in the estate, to appear at a reasonable time and place therein specified
to show cause why the prayer of the petition should not be granted.
Rule on Guardianship of Minors
A.M. No. 03-02-05-SC (April 1, 2003)
SECTION 20. Order to Show Cause. If the sale or
encumbrance is necessary or would be beneficial to the ward, the
court shall order his next of kin and all persons interested in the
property to appear at a reasonable time and place therein specified
and show cause why the petition should not be granted.|||

JURISDICTIONAL REQUIREMENT OF THE PETITION? (VNH)

1. It must be VERIFIED
2. NOTICE must be given to the next of kin; and
3. HEARING must be conducted to show cause why petition should be
granted.

CONTENTS:
- Petition to sell wards real estate will be presented to a specific
court, at a specific place, on a specific date; and
- All persons interested may, appear and show cause, if they have
any, why such petition should not be granted.

Next of kin does not mean the next of kindred but pertains to those relatives
who are entitled to share in the in the estate of the ward under the Law on
Intestate Succession including those who inherit per stripes or by right of
representation.

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RULE 95
SECTION 3. Hearing on return of order. Costs. At the time and place
designated in the order to show cause, the court shall hear the proofs and
allegations of the petitioner and next of kin, and other persons interested, together
with their witnesses, and grant or refuse the prayer of the petition as the best
interests of the ward require. The court shall make such order as to costs of the
hearing as may be just.
Rule on Guardianship of Minors
A.M. No. 03-02-05-SC (April 1, 2003)
SECTION 21. Hearing on Return of Order; Costs. At the
time and place designated in the order to show cause, the court
shall hear the allegations and evidence of the petitioner and next of
kin, and other persons interested, together with their witnesses, and
grant or deny the petition as the best interests of the ward may
require

The court shall make such order as to the cost of the hearing as may be just.

Hearing:
- At the time and place designated in the order to show cause
- Court shall hear proofs and allegations of petitioner and next of kin and
other persons interested and witnesses
- Court shall grant or refuse prayer of petition.
RULE 95
SECTION 4. Contents of order for sale or encumbrance, and how long
effective. Bond. If, after full examination, it appears that it is necessary, or
would be beneficial to the ward, to sell or encumber the estate, or some portion of
it, the court shall order such sale or encumbrance and that the proceeds thereof be
expended for the maintenance of the ward and his family, or the education of the
ward, if a minor, or for the putting of the same out at interest, or the investment of
the same as the circumstances may require. The order shall specify the causes
why the sale or encumbrance is necessary or beneficial, and may direct that estate
ordered sold be disposed of at either public or private sale, subject to such
conditions as to the time and manner of payment, and security where a part of the
payment is deferred, as in the discretion of the court are deemed most beneficial
to the ward. The original bond of the guardian shall stand as security for the

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proper appropriation of the proceeds of the sale, but the judge may, if deemed
expedient, require an additional bond as a condition for the granting of the order
of sale. No order of sale granted in pursuance of this section shall continue in
force more than one (1) year after granting the same, without a sale being had.
Rule on Guardianship of Minors
A.M. No. 03-02-05-SC (April 1, 2003)
SECTION 22. Contents of Order for Sale or Encumbrance and
its Duration; Bond. If, after full examination, it is necessary, or
would be beneficial to the ward, to sell or encumber the property,
or some portion of it, the court shall order such sale or
encumbrance the proceeds of which shall be expended for the
maintenance or the education of the ward, or invested as the
circumstances may require. The order shall specify the grounds for
the sale or encumbrance and may direct that the property ordered
sold be disposed of at public sale, subject to such conditions as to
the time and manner of payment, and security where a part of the
payment is deferred. The original bond of the guardian shall stand
as security for the proper appropriation of the proceeds of the sale
or encumbrance, but the court may, if deemed expedient, require
an additional bond as a condition for the sale or encumbrance. The
authority to sell or encumber shall not extend beyond one year,
unless renewed by the court.|||

The order of sale must specify the grounds. It may direct the estate be sold
publicly or privately. The court may also require an additional bond.

GENERAL RULE: Sale must first be confirmed by the court and that until
such confirmation, not even equitable title passes.

EXCEPTION: Where the court's order expressly authorized the guardian to

execute and deliver to purchaser definitely specifically describe at a price
already fixed, and it appears that the order was intended as the approval
itself of the sale that was already perfected or agreed upon by the seller and
the buyers, needing only judicial go-ahead signal to reduce the agreement to
the statutory form, it would be a useless formality to submit the deed to the
court for action in the absence of any clear requirement or direction to that
effect.||| (Soriano v. Latoo, G.R. No. L-3408, [December 23, 1950], 87
PHIL 757-761)

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The duration of the Order of Sale and Encumbrance of Property is within 1

year from granting of the order. The authority to sell or encumber shall not
extend beyond 1 year unless renewed by the court. It is presumed that if the
property was not sold within 1 year, the ward has sufficient income.

The guardian, among others, cannot acquire by purchase even at a public or

judicial auction, either in person or through the mediation of another, the
property of the person or persons who may be under his guardianship.
Civil Code
ARTICLE 1491. The following persons cannot acquire by
purchase, even at a public or judicial auction, either in person or
through the mediation of another:
(1) The guardian, the property of the person or persons
who may be under his guardianship;
(2) xxx
(3) xxx
(4) xxx
(5) xxx
(6) xxx

|||

There being a presumption that the sale of the wards estate is valid, it
cannot be attacked collaterally in the registration proceedings. A separate
action to avoid or rescind the sale on the grounds specified by law should be
filed.

RULE 95
SECTION 5. Court may order investment of proceeds and direct
management of estate. The court may authorize and require the guardian to
invest the proceeds of sales or encumbrances, and any other of his ward's money
in his hands, in real estate or otherwise, as shall be for the best interest of all
concerned, and may make such other orders for the management, investment, and
disposition of the estate and effects, as circumstances may require.
Rule on Guardianship of Minors
A.M. No. 03-02-05-SC (April 1, 2003)

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SECTION 23. Court may Order Investment of Proceeds and
Direct Management of Property. The court may authorize and
require the guardian to invest the proceeds of sales or
encumbrances, and any other money of his ward in his hands, in
real or personal property, for the best interests of the ward, and
may make such other orders for the management, investment, and
disposition of the property and effects, as circumstances may
warrant.

It provides regarding to the investment of other funds. While it requires

judicial authority in order that a guardian may invest the wards money, it
does not provide that said authority must always be either prior to or
express.