G.R. No.
L-18498 March 30, 1967 On November 27, 1953, Vitaliana Borromeo, a niece of the deceased, filed her own
TESTATE ESTATE OF VITO BORROMEO. JOSE H. JUNQUERA, petitioner-appellee,
vs.
CRISPIN BORROMEO, ET AL., oppositors-appellants.
REPUBLIC OF THE PHILIPPINES, intervenor-appellant.
Benjamin A. Rallon for oppositor-appellant Fortunato Borromeo.
Crispen Baizas and Associates for heirs oppositors-appellants Tomas Borromeo and
Amelia Borromeo.
Office of the Solicitor General for intervenor oppositor-appellant Republic.
Miguel Cuenco and Fernando S. Ruiz for heirs oppositors-appellants Crispin Borromeo,
Teofilo Borromeo, et al.
Filiberto Leonardo for petitioner-appellee.
DIZON, J.:
Vito Borromeo, a widower and permanent resident of the City of Cebu, died on March
13, 1952, in Parañaque, Rizal, at the age of 88 years, without forced heirs but leaving
extensive properties in the province of Cebu.
On April 19 of the same year, Jose H. Junquera, filed with the Court of First Instance
of said province a petition for the probate of a one page document as the last will left
by said deceased, devising all his properties to Tomas, Fortunato and Amelia, all
surnamed Borromeo, in equal and undivided shares, and designating Junquera as
executor thereof (Special Proceedings No. 916-R). The document — now in the record
as Exhibit "A" — was dated May 17, 1946, drafted in Spanish, and allegedly signed,
and thumbmarked by said deceased, in the presence of Dr. Cornelio G. Gandionco,
Eusebio Cabiluna and Filiberto Leonardo as attesting witnesses. On June 14, 1952, the
probate court appointed Junquera as special administrator of the estate.
On November 14 of the same year, Teofilo Borromeo filed an opposition to the
probate of the will based on the following grounds: (1) that the formalities required
by law had not been complied with; (2) that the testator was mentally incapable of
making a will at the time of its execution; (3) that the will was procured by undue and
improper influence, on the part of the beneficiaries and/or some other person; (4)
that the signature of the testator was procured by fraud; and (5) that the testator
acted by mistake or did not intend the instrument he signed to be his will at the time
he affixed his signature thereto.
Upon motion of the abovenamed oppositor, on June 9, 1953, the Court removed
Junquera as special administrator and appointed Dr. Patricio Beltran in his place.
opposition to the probate of the will, on the ground that the signature "Vito
Borromeo" appearing thereon was a forgery. Other oppositions were subsequently
filed by Patrocinio Borromeo de Tabotabo (her opposition was later withdrawn), Lilia
Morre de Tabotabo, Lamberto Morre, Patricia Morre de Ranario, Aurora Morre de
Borromeo, Ramon Ocampo, Isagani Morre and Rosario Morre, invoking substantially
the same grounds mentioned heretofore.
Meanwhile, Tomas, Amelia and Fortunato Borromeo, manifestly on behalf of the
"Cebu Arcade Company, T. L. Borromeo y Cia.", a duly organized partnership
controlled by them, filed a motion to exclude from the inventory of the Estate
previously filed by the new special administrator, thirteen parcels of land situated in
the City of Cebu with a total area of 2,148 square meters, alleging that during his
lifetime the deceased testator had sold said lots to them, as evidenced by the
document now in the record as Exhibit F-1 executed on May 17, 1945, confirming the
alleged previous sale. After due hearing, the court, in its order of July 16, 1954, denied
the motion for exclusion, ruling that movants' remedy was to file a separate accion
reivindicatoria against the administrator.
On October 28, 1955, the Republic of the Philippines filed a motion for leave to
intervene and join the oppositors in contesting the probate of the will, on the ground
that, should the estate be adjudicated the latter by intestacy, it stood to collect a
considerable amount by way of estate and inheritance taxes. In its order of December
10 of the same year, the Court allowed the intervention.
After a prolonged trial, on May 28, 1960, the Court rendered a decision denying the
probate of the will and declaring itself without jurisdiction to pass upon the question
of ownership over the thirteen lots which the Cebu Arcade etc. claimed as its own. All
the parties appealed — the proponents of the will from the portion of the decision
denying probate, and the oppositors and the Republic of the Philippines, from that
portion thereof where the court refused to decide the question of ownership of the
thirteen lots already mentioned.
The proponents of the disputed will, mainly with the testimony of the three attesting
witnesses, Cornelio Gandionco, Filiberto Leonardo and Eusebio Cabiluna, sought to
prove the following facts:
In the morning of May 17, 1945, Tomas Borromeo, complying with the request of Vito
Borromeo, went to the house of Atty. Filiberto Leonardo to request him to be a
witness at the execution of the latter's last will. Dr. Cornelio Gandionco, who at the
time happened to be in the house of Leonardo, was likewise requested to act as such.
Together, the three went to the residence of Vito Borromeo at Ramos Street, Cebu
City. Upon their arrival the third witness, Eusebio Cabiluna, who was living on the
ground floor of the house, was asked to come upstairs. Thereafter, in their presence,
Vito Borromeo executed first, the document Exhibit "F" (deed of confirmation of an
alleged previous sale to Cebu Arcade Company, T. L. Borromeo y Cia.) witnessed by
Gandionco and Cabiluna. Later, Vito Borromeo, being of sound and disposing mind,
and without pressure or influence exerted on him, dictated the substance of his will
to Tomas Borromeo, who in turn typewrote it in proper legal language. The document
was then read by Vito Borromeo, who later signed and thumbmarked it (Exhibit "A")
and carbon copies thereof (Exhibits "E" and "K") in the presence of the attesting
witnesses, who, in turn, signed the will and its copies in the presence of Vito Borromeo
and of each other.
Proponents also placed the Rev. Fr. Julio Corres, a Spanish Catholic priest who was the
confessor of Vito Borromeo from 1942 to 1946, the Rev. Fr. Sergio Alfafara, who was
his confessor from 1946 to 1947, and Vicenta Mañacap, a mid-wife who lived in the
testator's house and had served him from May 1945 up to his death on March 30,
1952 on the witness stand. The gist of their testimony is to the effect that at the time
of the execution of the will, Vito Borromeo was still strong and could move around
freely with the aid of a cane; that he was still mentally alert and was a man of strong
will; that his right hand was unimpaired and he could write with it unaided; that as a
matter of fact — according to Vicenta Mañacap — he still wrote personal letters to
Tomas Borromeo, could eat by himself and even played the piano.
On the other hand, the oppositors presented several witnesses who testified that the
signatures purporting to be those of Vito Borromeo on the document Exhibit "A" and
its copies were forgeries; that they were too good and too perfect signatures and,
therefore, quite impossible for the deceased — an ailing man already 82 years old on
May 17, 1945 — to write; that he was found "positive for bacillus leprosy" by Dr.
Antonio Garcia as early as 1926 or 1927, having been treated for it consistently by
injections of chaulmoogra oil administered by Dr. Max Borromeo and Dr. Cornelio
Gandionco; that Vito Borromeo's usual signatures during his better days had always
been characterized by certain flourishes, technically called "rubric"; that Vito
Borromeo had also reared and educated two of the oppositors, Crispin Borromeo and
the late Teofilo Borromeo and there was no conceivable reason why they were left
out in the will, if any such will had really been made by him knowingly; that the
testamentary witness Cornelio Gandionco, is a nephew of the other witness, Filiberto
Leonardo, and was the fiance of Angeles Borromeo, a sister of Tomas Borromeo, one
of the instituted heirs; that the third testamentary witness, Eusebio Cabiluna is the
real father of Fortunato Borromeo, another instituted heir, who admittedly grew up
and was reared by Vito Borromeo and his wife Juliana Evangelista since he was barely
three months; that Amelia Borromeo, the third instituted heir, is a younger sister of
Tomas Borromeo and dependent upon him; that on May 17, 1945, the deceased's
leprosy was so far advanced that the fingers of his right hand were already hardened
and atrophied, this making it difficult, if not impossible, for him to write; and that on
the same date, his sense of hearing and his eyesight had been considerably impaired,
his eyes being always watery due to the progress of his leprosy.
The oppositors also presented Felipe Logan of the National Bureau of Investigation
and Jose G. Villanueva, as handwriting experts, who testified, after examining the
supposed signatures of the deceased in Exhibit "A" and comparing them with his
accepted standard signatures, that the questioned signatures were forgeries. The
proponents, however, presented their own handwriting expert, Martin Ramos, who
testified to the contrary.
The trial court refused to believe the testimony of the attesting witnesses and, as a
result, denied the petition for probate, because, in its opinion, they appeared not to
be "wholly disinterested persons" and because of the serious discrepancies in their
testimonies with respect to the number of copies made of the disputed document.
The court also found that the physical condition of the deceased at the time of the
execution of the questioned document was such that it was highly improbable, if not
impossible, for him to have affixed his signatures on the documents Exhibits A, E and
K in the spontaneous and excellent manner they appear to have been written. Thus,
the court was also led to believe the testimony of the handwriting experts for
oppositors, — adverse to the genuineness of the signatures of Vito Borromeo on the
questioned document — more than that of the handwriting expert presented by the
proponents of the will.
It seems clear, therefore, that the main issue to be decided in the present appeal is
whether or not the evidence of record is sufficient to prove the due execution of the
will in question.1äwphï1.ñët
It must be conceded that in this jurisdiction, the subscribing witnesses to a contested
will are regarded as the best witnesses in connection with its due execution. It is
similarly true, however, that to deserve full credit, their test, testimony must be
reasonable and unbiased, and that, as in the case of any other witness, their testimony
may be overcome by any competent evidence — direct or circumstantial (Board, etc.
vs. Shasser, 10 Kan. 585, 168 Pac. 836 [1917]).
It is also an appellate practice of long standing in this jurisdiction to accord great
weight to the findings of fact made by the trial court and not to disturb them unless
said court had failed to consider material facts and circumstances or had given undue
weight to, or misconstrued the testimony of particular witnesses, the reason for this
being that the trial judge had full opportunity to hear and observe the conduct and
demeanor of the witnesses while testifying and was consequently in a better position
than the reviewing court to determine the question of their credibility. While this is
not applicable to the present case because His Honor, the judge who penned the
appealed decision was not the same judge before whom the evidence of the parties
was presented, it must be stated that, judging from the carefully written decision
under review, it was only after a thorough study of the record that His Honor arrived
at the conclusion that the subscribing witnesses do not appear to be wholly
disinterested persons.
On the matter of the number of copies made of the questioned will allegedly signed
by the testator and the three subscribing witnesses, His Honor found that Cabiluna
was very uncertain and confused; that a certain stage of his examination, he said that
only two copies of the will were prepared — the original and one carbon copy — while
at another stage he affirmed that he did not know whether or not there was a
duplicate and that all he could say was that he had affixed his signature three times
(Transcript, Marquiala, August 22, 1958, pp. 49-50). In truth, however, he really signed
six (6) times — twice on the original and twice on each of the two copies. Adding
confusion to the situation is the answer he gave when he was asked if Vito Borromeo
also signed the carbon copy, to which his answer was "I did not see" (Idem., p. 50).
On the other hand, the other subscribing witness, Atty. Filiberto Leonardo, testified
categorically that there were only the original and one carbon copy of the will and that
the testator and all the subscribing witnesses signed both (Transcript, Marquiala,
December 23, 1953, pp. 167, 210, and 218). However, the naked and highly disturbing
fact is that, contrary to what is inferable from the vacillating testimony of Cabiluna and
the categorical assertion of Atty. Leonardo, the proponents of the questioned will
themselves presented three copies of said will; the original, a carbon duplicate copy
and a carbon triplicate copy, now in the record as Exhibits A, E and K, respectively.
While it is true that the testimony of these subscribing witnesses was given around
eight years after the alleged execution of the questioned will, still we believe that the
transaction in which they claim to have taken an important part is of such character
and importance that it can not be a very easy matter for anyone of them to have a
hazy recollection of the number of copies signed by the testator and by them. Stranger
still would it be for them to say something in open contradiction with the reality on
the matter. If, as may be clearly deduced from their testimony — Cabiluna and
Leonardo's — there was only the original and one copy signed by the testator and the
subscribing witnesses, why is it that three — original and two copies — were really in
existence and were produced in court during the trial?
In the case of the third subscribing witness, Dr. Cornelio Gandionco, the imputation
was made by two witnesses, Dr. Teofilo Borromeo and Judge Crispin Borromeo, that
he was the fiance of Angeles Borromeo, sister of Tomas Borromeo, who is one of the
three heirs instituted in the questioned will, evidently to show that he is not a
completely disinterested witness. The evidence to this effect appears to have
remained unimpeached, although the proponents of the will could have done it by
calling on Dr. Gandionco himself or on Angeles Borromeo to deny the imputation.
Moreover, the evidence also disclose that Dr. Gandionco was the uncle of the other
subscribing witness, Atty. Leonardo, and that, in fact, they were living together at the
time of the alleged execution of the will. This circumstance — apparently trivial — can
not be taken lightly because in view of appellee's claim that Angeles Borromeo was
the fiance of Dr. Gandionco, it would not be unreasonable to entertain the suspicion
that both subscribing witnesses were not wholly disinterested. Material to this point
is the fact established by the evidence that Atty. Leonardo was the notary public
before whom the document Exhibit 4-A — which purports to convey to a partnership
controlled by the heirs instituted in the questioned will thirteen parcels of land
situated in the commercial center of Cebu City — was supposedly acknowledged by
the testator on the same date May 17, 1945.
In the light of the foregoing, We can not see our way clear to holding that the trial
court erred in refusing to give full credit to the testimony of the three subscribing
witnesses.
It has also been held that the condition and physical appearance of a questioned
document constitute a valuable factor which, if correctly evaluated in the light of
surrounding circumstances, may help in determining whether it is genuine or forged.
Subscribing witnesses may forget or exaggerate what they really know, saw, heard or
did; they may be biased and, therefore, tell only half truths to mislead the court or
favor one party to the prejudice of the other. This can not be said of the condition and
physical appearance of the questioned document itself. Both, albeit silently, will reveal
the naked truth, hiding nothing, forgetting nothing, and exaggerating nothing. For this
reason, independently of the conflicting opinions expressed by the handwriting
experts called to the witness stand by the parties, we have carefully examined and
considered the physical appearance and condition of the original and two copies of
the questioned will found in the record — particularly the signatures attributed to the
testator — and We have come to the conclusion that the latter could not have been
written by him.
Upon the face of the original and two copies of the contested will (Exhibits A, E and K)
appear a total of six alleged signatures of the testator. They are all well written along
a practically straight line, without any visible sign of tremor or lack of firmness in the
hand that wrote them. In fact, in the respects just adverted to, they appear better
written than the unquestioned signatures, of attesting witnesses Gandionco and
Cabiluna, inspite of the fact that on the date of the alleged execution of the will (May
17, 1945) the testator was considerably older and in a much poorer physical condition
than they. According to the evidence, the testator was then a sick man, eighty-two
years old, with the entire left half of his body paralyzed since six years before, while
the oldest attesting witness (Cabiluna) was around sixty-five years of age and
Leonardo and Gandionco were only forty-four and forty-five years old respectively,
and were all in good health. Despite the obviously very poor physical condition of the
testator, Leonardo claims that he signed the alleged will unaided, writing his name
thereon slowly but continuously or without interruption, and that, on the same
occasion, he signed his name several times not only on the original of the will and its
copies but also on the original and several copies of the alleged confirmatory sale
Exhibit F-1 and on his residence certificate. Considering all the attendant
circumstances, we agree with the lower court that Vito Borromeo could not have
written the questioned signatures.
In view of what has been said heretofore, We find it unnecessary to examine and
consider in detail the conflicting testimony of the handwriting experts presented by
the parties: Martin Ramos by the proponents of the will, to sustain the genuineness
of the questioned signatures, and Felipe Logan and Jose G. Villanueva, by the
oppositors, to prove that said signatures are forgeries. We shall limit ourselves in this
connection to quoting with approval the following portion of the appealed decision:
What the Court finds to be a weakness in the conclusions of Martin Ramos,
based on his comparative examination of the questioned and standard
signatures of Vito Borromeo, is his apparent assumption that all the
signatures were made by Vito Borromeo under equality or similarity of
circumstances, that is, that in all instances Vito Borromeo had normal use of
both of his hands, — the right and the left. He failed to take into account that
when Vito Borromeo allegedly affixed those signatures on May 17, 1945 on
Exhibits 'A', 'E', and 'K' the left portion of his body, including the left hand,
was already paralyzed, and Vito Borromeo was represented to have written
his name alone by himself and unaided. Maybe, if he was previously apprised
of those circumstances, he would hesitate to make the conclusion that those
flawless signatures reading Vito Borromeo, written straight and in a form as
good as, if not better than, the signatures of three much younger attesting
witnesses, were positively in the handwriting of the 82-year old, ailing, and
paralytic Vito Borromeo. The Court consequently, finds itself not disposed to
adopt his conclusions, but on the contrary is inclined toward the views of the
other two experts witnesses, Felipe Logan and Jose G. Villanueva.
As stated at the outset, the contested will is claimed to have been signed and
thumbmarked by the testator. An examination of the thumbmarks, however, readily
shows that, as the lower court found, the same are "glaringly far from being distinct
and clear"; that "they are not a possible means of identification" nor can "they possibly
be identified to be those of Vito Borromeo, or for that matter, of any other person
whatsoever". It is, therefore, obvious, that they are of little use in the resolution of the
issue before Us.
We shall now consider the appeal, taken by the oppositors and the Republic of the
Philippines from that portion of the decision where the lower court declined to decide
with finality the question of who owns the thirteen parcels of land subject-matter of
the confirmatory sale Exhibit F-1 and whether or not they should be included in or
excluded from the inventory of properties of the Estate of the deceased Vito
Borromeo.
It appears that on February 11, 1954 Tomas, Amelia, and Fortunato Borromeo,
through counsel, filed a motion for the exclusion from the inventory of the Estate of
the thirteen lots therein mentioned, with a total area of 2,348 square meters, claiming
that the same had been sold by the deceased Vito Borromeo during his lifetime to the
Cebu Arcade, T. L. Borromeo y Cia. This motion for exclusion was denied by the lower
court in its order of July 16, 1954, and the ruling was reiterated in the appealed
decision "for the same reasons and considerations" upon which it rejected the probate
of the will. The ruling on the matter, however, was expressly made provisional in
nature.
We believe, and so hold, that the resolution of the lower court on this matter is correct
because said court, acting in its capacity as a probate court, had no jurisdiction to
determine with finality the question of ownership involved. That such matter must be
litigated in a separate action has been the established jurisprudence in this jurisdiction
(Ongsinco vs. Borja, L-7635, July 25, 1955; Mallari vs. Mallari, L-4656, February 23,
1953; Garcia vs. Martin, G.R. No. L-9233, June 29, 1957; Cordova vs. Ocampo, 73 Phil.
661; Pascual vs. Pascual, 73 Phil. 561 and others), except where a party merely prays
for the inclusion or exclusion from the inventory of any particular property, in which
case the probate court may pass upon provisionally, the question of inclusion or
exclusion, but without prejudice to its final determination in an appropriate separate
action (Garcia vs. Garcia, 67 Phil. 353; Marcelino vs. Antonio, 70 Phil. 388; Guinguing
vs. Abuton, 48 Phil. 144, 147).
In view of all the foregoing, the decision appealed from is affirmed, with costs.
Concepcion, C.J., Reyes, J.B.L., Regala, Makalintal, Bengzon, J.P., Zaldivar, Sanchez and
Castro, JJ., concur.
G.R. No. 43351 February 26, 1937
Intestate estate of the deceased Baldomero Cosme.
ROSARIO COSME DE MENDOZA, administratrix-appellee,
vs.
JANUARIO PACHECO and RAYMUNDO CORDERO, sureties-appellants.
Vicente J. Francsico and Estanislao A. Fernandez, Jr. for appellants.
R. Gonzales Lloret for appellee.
LAUREL, J.:
The facts in this case are not disputed. Manuel Soriano was former administrator of
the estate of Baldomero Cosme in civil case No. 5494, Court of First Instance of
Laguna. To assure faithful performance of his duties as such administrator, he filed a
bond for P5,000, with the herein appellants, Januario Pacheco and Raymundo
Cordero, as sureties. Soriano's account, upon approval, showed him indebted to the
estate in the sum of P23,603.21. Unable to turn this amount over to the estate upon
demand of Rosario Cosme, the new administratrix, the lower court ordered the
execution of his bond on November 4, 1932, after notice duly served upon the
sureties. Sometime later, the court approved a settlement had between the
adminstratrix and the ex-administrator, whereby the latter ceded certain real
properties to the estate reducing on that account his indebtedness to the estate from
P23,603.21 to P5,000. As to this last amount, "La administradora se atiene a la orden
de ejecucion de la fianza suscrita por los fiadores Januario Pacheco y Raymundo
Cordero" (Record on Appeal, p. 2). Subsequently, the administratrix had the public
sale thereof to collect this amount of P5,000. Separate motions to he discharged from
the bond were filed by sureties Pacheco and Cordero. Both motions were denied. A
motion by Cordero to reconsider the order of denial met a like fate. Brought on appeal
to this court, the appeal was dismissed. The dispositive part of the decision of this
court (G. R. No. 40998, Cosme de Mendoza vs. Pacheco and Cordero [60 Phil., 1057])
reads as follows:
The motion of October 1, 1933, was filed only on behalf of Raymundo
Cordero who filed no motion for reconsideration of the order of execution of
November 4, 1932, and took no appeal therefrom. Being of the opinion that
the trial court correctly held that said order had become final, the motion of
October 31, 1933, for reconsideration (if such it may be called) came too late.
The judgment is therefore affirmed with costs against the appellants.
When the case was remanded to the lower court, the sureties filed a motion
challenging, for the first time, the jurisdiction of the trial court to issue the order of
November 4, 1932, executing the bond. The trial court denied the motion in view of
the decision of this court. The case is elevated here for the second time on appeal.
Appellants assign the following error:
The lower court erred in refusing: (a) To declare null and void its order of
execution of the ex-administrator's bond of November 4, 1932, as well as the
writs of execution issued in virtue thereof; (b) to accordingly vacate said
order of November 4, 1932, and order the release of the properties of the
herein sureties-appellants attached in pursuance of the writs of execution
issued against them by virtue of said order; and (c) to order the suspension
of the execution of the said order of November 4, 1932, until this case is
finally decide.
In the discussion of the foregoing assignment of error in their brief (pp. 9-23), the
appellants take in six propositions. One question, however, — that of jurisdiction of
the Court of First Instance of Laguna to order the execution of the administrator's
bond — is decisive of this appeal. Appellants, sureties upon the bond, press the point
that the order in suit is an absolute nullity for lack of power in the issuing court. "In
vain," they tell us, "have we searched our statute books, especially the part of our
Code of Civil Procedure regarding probate jurisdiction, to find whether our Courts of
First Instance, acting as probate courts, have the power to order the execution of an
administrator's bond." Neither their failure to assail that jurisdiction when they ought
nor the subsequent affirmance of the order by this court, they say, could revive an
order dead from its inception.
To begin with, it lies within discretion of the court to select an administrator of the
estate of a deceased person (Capistrano vs. Nadurata, 46 Phil., 726, 727). Before an
administrator, or an executor, enters upon the execution of his trust, and letters
testamentary or of administration are issued, the person to whom they are issued is
required to give a bond in such reasonable sum as the court directs, with one or more
sufficient sureties, conditioned upon the faithful performance of his trust (Code of
Civil Procedure, sec. 643, 662). The administrator is accountable on his bond along
with the sureties for the performance of certain legal obligations. (Tan vs. Go Chiong
Lee, 46 Phil., 200, 205. See also, Stovall vs. Banks, 10 Wall., 583, 588; 19 Law. ed., 1036;
Long vs. O'Fallon, 19 How., 116; 15 Law. ed., 550.) It is clear that a Court of First
Instance, exercising probate jurisdiction, is empowered to require the filing of the
administrator's bond, to fix the amount thereof, and to hold it accountable for any
breach of the administrator's duty. Possessed, as it is, with an all-embracing power
over the administrator's bond and over administration proceedings, a Court of First
Instance in a probate proceeding cannot be devoid of legal authority to execute and
make that bond answerable for the very purpose for which it was filed. It is true that
the law does not say expressly or in so many words that such court has power to
execute the bond of an administrator, but by necessary and logical implication, the
power is there as eloquently as if it were phrased in unequivocal term. When the
accountability of an administrator's bond is spoken of in the very provisions dealing
with and bearing directly on administration proceedings, it would involve a strained
construction to hold, as appellants would have us do, that where an administrator is
held liable for a devastravit for having squandered and misapplied property which he
was in duty bound to marshal and conserve, the estate is without a remedy to go
against the administrator's bond in the same probate proceedings, but in an action
outside of and separate from it. In this connection, it should be observed that section
683 of the Code of Civil Procedure provides that "Upon the settlement of the account
of an executor or administrator, trustee, or guardians, a person liable as surety in
respect to such amount may, upon application, be admitted as a party to such
accounting, and may have the right to appeal as hereinafter provided." There is here
afforded to a person who may be held liable as surety in respect to an administrator's
account the right, upon application, to be admitted as a party to their accounting, from
which we may not unreasonably infer that a surety, like the appellants in the case
before us, may be charged with liability upon the bond during the process of
accounting, that is, within the recognized confines of probate proceedings, and not in
an action apart and distinct from such proceedings.
Appellants in their brief direct our attention to several cases decided by this court
holding that Courts of First Instance, as probate courts, have no power to adjudicate
on claims of other persons on property forming part of the estate, by title adverse to
the deceased (Guzman vs. Anog and Anog, 37 Phil., 61, 62); on the legal usufruct of
the widow (Sahagun vs. De Gorosita, 7 Phil., 347, 351), and on the validity of
testamentary dispositions (Castañeda vs. Alemany, 3 Phil., 426, 428). We have
carefully examined these cases in relation to the facts and circumstances of the case
at bar. We take the view, however, that the execution of an administrator's bond,
unlike the questions involved in the cited cases, clearly stands upon a different footing,
and is as necessary a part and incident of the administration proceeding as the filing
of such bond or the fixing of its amount. Particularly is this true in the present case
where Soriano's indebtedness to the sate in the amount of P23,603.21, subsequently
reduced to P5,000, is conceded on all sides, and all that the trial court had to do was
to see that said amount was turned over to the estate. It is the duty of courts of
probate jurisdiction to guard jealously the estates of the deceased person by
intervening in the administration thereof in order to remedy or repair any injury that
may be done thereto (Dariano vs. Fernandez Fidalgo, 14 Phil., 62, 67; Sison vs.
Azarraga, 30 Phil., 129, 134). "Probate and like courts have a special jurisdiction only,
and their powers as to ancillary or incidental questions must of necessity to exercise
within certain limitations; but such powers include the right to try questions which
arise incidentally in a cause over which such courts have jurisdiction and the
determination of which are necessary to a lawful exercise of the powers expressly
conferred in arriving at a decision. . . . There seems, however, to be a general
tendency, in the absence of express and specific restrictions to the contrary, to uphold
the exercise by these court of such incidental powers as are, within the purview of
their grant of authority, reasonably necessary to enable them to accomplish the
objects for which they were invested with jurisdiction and to perfect the same. And it
has been held that statutes conferring jurisdiction on such courts, being remedial and
for the advancement of justice, should receive a favorable construction, such as will
give them the force and efficiency intended by the legislature." (15 C. J., 813, 814.)
The tendency in the United States indeed has been towards the enlargement of the
powers of probate courts. In the beginning these courts were possessed but limited
powers. Having originated from the ecclesiastical courts of England, their jurisdiction,
following their English patterns was practically limited to the probate of wills, the
granting of administrators, and the suing for legacies (Plant vs. Harrion, 74 N. Y. Sup.,
411, 441; 36 Misc. Rep., 649; Chadwick vs. Chadwick, 13 Pac., 385, 388; 6 Mont., 566;
3 Bl. Comm., pp. 95-98). But, though they still are often unadvisedly described,
particularly in Connecticut (Griffin vs. Pratt, 3 Conn., 513), as courts of limited, inferior
or special jurisdiction, they have outgrown their limitations and have become courts
with considerably increased powers (Woerner, The American Law of Administration
[2d], sec. 145; Plant vs. Harrison, supra).
What has been said sufficiently determinative of the appeal before us. We wish,
however, to say a word on a salutary consideration of policy which has been invariably
followed by this court in cases of this nature. We refer to the dispatch and economy
with which administration of the estates of deceased persons should be terminated
and settled. It will be recalled that the appellants could have raised the question of
jurisdiction now pressed upon us in civil case No. 5494 of the Court of First Instance
of Laguna and on appeal of that case to this court once before (G. R. No. 40998 [60
Phil., 1057]). They not failed to avail of that right but failed to appeal from the order
complained of (Vide, Decision of this court in G. R. No. 40998, Cosme de Mendoza vs.
Pacheco and Cordero). The questions raised in the appeal at bar, appellant's second
attempt to go about and frustrate the order in question, could have been passed upon
once for all in the case referred to. We cannot encourage a practice that trenches
violently upon the settled jurisprudence of this court that the policy and purpose of
administration proceedings is ". . . to close up, and not to continue an estate . . ."
(Lizarraga Hermanos vs. Abada, 40 Phil., 124, 133), and that ". . . the State fails
wretchedly in its duty to its citizens if the machinery furnished by it for the division
and distribution of the property of a decedent is so cumbersome, unwidely and
expensive that a considerable portion of the sate is absorbed in the process of such
division. Where administration is necessary, it ought to be accomplished consumes
any considerable portion of the property which it was designed to distribute is a
failure. . . ." (McMicking vs. Sy Conbieng, 21 Phil., 211, 220.)
The order appealed from is hereby affirmed, with costs against the appellants. So
ordered.
G.R. No. L-6637 September 30, 1954
WARNER BARNES AND CO., LTD., plaintiff-appellee,
vs.
LUZON SURETY CO., INC., defendant-appellant.
Tolentino and Garcia and Domingo R. Cruz for appellant.
Hilado and Hilado and Reyes and Castro for appellee.
PARAS, C.J.:
On September 17, 1952, the plaintiffs, Warner, Barnes and Co., Ltd., filed a complaint
in the Court of First Instance of Negros Occidental against the defendant, Luzon Surety
Co., Inc., of the recovery of the sum of P6,000, plus the costs and P1,500 for attorney's
fees. The basis of the complaint was a bond in the sum of P6,000 filed by Agueda
Gonzaga as administratrix of the Intestate Estate of Agueda Gonzaga on or about
January 6, 1951, in Special Proceedings No. 452 of the Court of First Instance of Negros
Occidental, the condition being that said bond would be void if the administratrix
"faithfully prepares and presents to the Court, within three months from the date of
his appointment, a correct inventory of all the property of the deceased which may
have come into his possession or into the possession of any other person representing
him according to law, if he administers all the property of the deceased which at any
time comes into his possession or into the possession of any other person
representing him; faithfully pays all debts, legacies, and bequests which encumber
said estate, pays whatever dividends which the Court may decide should be paid, and
renders a just and true account of his administrations to the Court within a year or at
any other date that he may required so to do, and faithfully executes all orders and
decrees of said court." It was alleged in the complaint that the plaintiff had a duly
approved claim against the Estate of Aguedo Gonzaga in the sum of P6,485.02, plus 2
per cent annual interest compounded monthly from October 1, 1941; that the
administratrix violated the conditions of her bond "(a) by failing to file an inventory of
the assets and funds of the estate that had come into her hands, more particularly,
the sum of P67,861.22 that she had received form the United States Philippine War
Damage Commission; (b) by failing to pay or discharge the approved claim of the
plaintiff; (c) by failing to render a true and just account of her administration in
general, and of the said war damage payments in particular."; that the defendant, as
surety in the bond, failed to pay to the plaintiff, notwithstanding the latter's demand,
the sum of P6,000, in partial satisfaction of plaintiff's unpaid claim which, after
deduction the sum of P3,000 previously paid upon account by the administratrix,
amounted to P8,186.68 as of August 31, 1952.
The defendant filed an answer setting up the special defenses that the complaint did
not state a cause of action; that its maximum liability under the surety bond is P6,000;
that if it were not for the untimely death of the judicial administratrix, she would have
been able to fully comply with her duties and obligations; that the administratrix, up
to her death, had not yet been authorized by the court in Special Proceedings No. 452
to pay plaintiff's claim; that the defendant's liability had been extinguished; that
damages or attorney's fees cannot be recovered under the surety bond.
On January 6, 1953, the plaintiff filed a motion for summary judgment, alleging that
"the special defenses relied upon by the defendant in her Answer raise only questions
of law, and the plaintiff believes that said defendant cannot produce counter-affidavits
that would raise any 'genuine issues as to any material facts.' This motion was
accompanied by Exhibits "A" to "H", Exhibits "A" being an affidavit of Atty. Luis G.
Hilado who signed the complaint.
As the defendant did not file counter-affidavits so as to raise genuine issues as to any
material fact, although a copy of the motion for summary judgment was served upon
it eleven days prior to the date of the hearing thereon, the Court of First Instance of
Negros Occidental rendered on January 17, 1953, a summary judgment sentencing
the defendant to pay to the plaintiff the sum of P6,000, P900 for attorney's fees, plus
the costs. From this judgment the defendant appealed.
Under the first assignment of error, the appellant contends that the lower court had
no jurisdiction to pass upon its liability under the bond in question, because it is only
the probate court that can hold a surety accountable for any breach by the
administratrix of her duty, citing the case of Mendoza vs. Pacheco, 64 Phil., 134. It is,
however, noteworthy that while the citation is to the effect that the probate court has
jurisdiction over the forefeiture or enforcement of an administrator's bond, it was not
held therein that the same matter may not be litigated in an ordinary civil action
brought before the court of first instance.
Under the second assignment of error, the appellant claims that there are genuine
controversies between the parties litigant, and that, contrary to the allegations of the
complaint, the administratrix made a return to the court of the war damage payments
she received; the administratrix cannot be charged with having failed to pay plaintiff's
claim because there is no showing that she was ever authorized to pay approved
claims; the administratrix may be presumed to have rendered an accounting of her
administration, likely in 1948, in accordance with section 8 of Rule 86 of the Rules of
Court. In answer, it is sufficient to state that the allegations that the administratrix
failed to file an inventory, to pay the plaintiff's claim, and to render a true and just
account of her administration, are factual and remained uncontroverted by counter-
affidavits which the appellant could have easily filed.
It is also argued for the appellant that the supporting affidavit Exhibit "A" is insufficient,
being signed merely by the lawyer, and not by a party to the case or an officer of the
plaintiff firm. This is without merit, since Exhibit A contains an express statement that Wherefore, it being understood that the defendant-appellant is sentenced to pay to
the affiant, Atty. Luis G. Hilado, had "personal knowledge of the facts" alleged therein; the plaintiff-appellee only the sum of P6,000, plus the cost, the same is hereby
and this cannot be negatived by appellant's speculation to the contrary. affirmed.

Under the third and fourth assignments of error, it is insisted for the appellant that Pablo, Bengzon, Padilla, Montemayor, Reyes, A., Jugo, Bautista Angelo, Concepcion
the bond in question was executed in favor of the Republic of the Philippines and that and Reyes, J.B.L., JJ., concur.
the proper procedure would seem to be that it might be enforced in the
administration proceedings were it was filed. This view is likewise not tenable. Though
nominally payable to the Republic of the Philippines, the bond is expressly for the
benefit of the heirs, legatees and creditors of the Estate of the deceased Aguedo
Gonzaga. There is no valid reason why a creditor may not directly in his name enforce
said bond in so far as he is concerned.

Under the fifth assignment of error, it is alleged that the plaintiffs should have first
filed a claim against the Estate of the deceased administratrix Agueda Gonzaga, in
conformity with section 6 of Rule 87 of the Rules of Court providing that "Where the
obligation of the decedent is joint and several with another debtor, the claim shall be
filed against the decedent as if he were the only debtor, without prejudice to the right
of the estate to recover contribution from the other debtor." Apart from the fact that
his defense was not pleaded either in a motion to dismiss or in the answer and was
therefore waived (section 10, Rule 9 of the Rules of Court), it appears that even as late
as September 17, 1952, when the present complaint was filed, (more than two years
after the death of Agueda Gonzaga), there were no proceedings for the administration
of her estate, with the result that section 6 of Rule 87 loses its applicability. Moreover,
it is to be noted that the appellant had also chosen to file a third-party complaint in
the present case against Romualdo Araneta, joint and several counter-guarantor of
the deceased administratrix, instead of presenting a claim against the latter's estate.

In its sixth assignment of error, the lower court is alleged to have erred in sentencing
the appellant to pay attorney's fees in the sum of P900, in excess of the limit of its
bond. This contention is tenable. Under section 3 of Rule 36 of the Rules of Court, a
summary judgment may be rendered upon proper motion except as to the amount of
damages.1âwphïl.nêt

There being no proof regarding the amount of attorney's fees claimed by the plaintiff,
no judgment thereon may be rendered herein. It is, however, argued by the counsel
for appellee that said fees are in pursuance of article 2208 of the Civil Code, providing
that attorney's fees cannot be recovered except "where the defendant acted in gross
and evident bad faith in refusing to satisfy the plaintiff's plainly valid, just and
demandable claim"; and it alleged in the complaint that the appellant had so acted in
this case. While the provision cited authorizes the collection of attorney's fees under
the situation contemplated herein, it does not dispense with the effect of section 3 of
Rule 36.
G.R. No. L-40517 January 31, 1984
LUZON SURETY COMPANY, INC., plaintiff-appellee,
vs.
PASTOR T. QUEBRAR and FRANCISCO KILAYKO, defendants-appellants.
Tolentino & Garcia & D. R. Cruz for plaintiff-appellee.
Zoilo V. dela Cruz, Jr. for defendants-appellants.
MAKASIAR, J.:
This is an appeal from the judgement of the Court of First Instance of Manila in Civil
Case No. 52790 dated November 3, 1964 which was certified to this Court by the Court
of Appeals in its resolution dated March 20, 1975.
On August 9, 1954, plaintiff-appellee issued two administrator's bond in the amount
of P15,000.00 each, in behalf of the defendant-appellant Pastor T. Quebrar, as
administrator in Special Proceedings Nos. 3075 and 3076 of the Court of First Instance
of Negros Occidental, entitled " Re Testate Estate of A. B. Chinsuy," and Re Testate
Estate of Cresenciana Lipa," respectively, (pp. 8-12, 17-21, ROA; p. 9 rec.). In
consideration of the suretyship wherein the plaintiff-appellee Luzon Surety Company,
Inc. was bound jointly and severally with the defendant appellant Pastor T. Quebrar,
the latter, together with Francisco Kilayko, executed two indemnity agreements,
where among other things, they agreed jointly and severally to pay the plaintiff-
appellee "the sum of Three Hundred Pesos (P300.00) in advance as premium thereof
for every 12 months or fraction thereof, this ... or any renewal or substitution thereof
is in effect" and to indemnify plaintiff-appellee against any and all damages, losses,
costs, stamps taxes, penalties, charges and expenses, whatsoever, including the 15%
of the amount involved in any litigation, for attomey's fees (pp. 12-16, 21-25. ROA; p.
9, rec.).
For the first year, from August 9, 1954 to August 9, 1955, the defendants-appellants
paid P304.50 under each indemnity agreement or a total of P609.00 for premiums and
documentary stamps.
On June 6, 1957, the Court of First Instance of Negros Occidental approved the
amended Project of Partition and Accounts of defendant-appellant (p. 87, ROA; p. 9,
rec.).
On May 8, 1962, the plaintiff-appellee demanded from the defendants-appellants the
payment of the premiums and documentary stamps from August 9,1955.
On October 17, 1962, the defendants-appellants ordered a motion for cancellation
and/or reduction of executor's bonds on the ground that "the heirs of these testate
estates have already received their respective shares" (pp. 69-70, ROA, p. 9, rec.).
On October 20, 1962, the Court of First Instance of Negros Occidental acting on the
motions filed by the defendants-appellants ordered the bonds cancelled.
Plaintiff-appellee's demand amounted to P2,436.00 in each case, hence, a total of
P4,872.00 for the period of August 9, 1955 to October 20, 1962. The defendants-
appellants to pay the said amount of P4,872.00.
On January 8, 1963, the plaintiff-appellee filed the case with the Court of First Instance
of Manila During the pre-trial the parties presented their documentary evidences and
agreed on the ultimate issue - "whether or not the administrator's bonds were in force
and effect from and after the year that they were filed and approved by the court up
to 1962, when they were cancelled." The defendants-appellants offered P1,800.00 by
way of amicable settlement which the plaintiff-appellee refused.
The lower court allowed the plaintiff to recover from the defendants-appellants,
holding that:
We find for the plaintiff it is clear from the terms of the Order of the
Court in which these bond were filed, that the same were in force
and effect from and after filling thereof up to and including 20
October, 1962, when the same werecancelled. It follows that the
defendants are liable under the terms of the Indemnity Agreements,
notwithstanding that they have not expressly sought the renewal of
these bonds bemuse the same were in force and effect until they
were cancelled by order of the Court. The renewal of said bonds is
presumed from the fact that the defendants did not ask for the
cancellation of the same; and their liability springs from the fact that
defendant Administrator Pastor Quebrar, benefited from the bonds
during their lifetime.
We find no merit in defendants' claim that the Administrator's
bonds in question are not judicial bonds but legal or conventional
bonds only, since they were constituted by virtue of Rule 82, Sec. 1
of the Old Rule of Court. Neither is there merit in defendants, claim
that payments of premiums and documentary stamps were
conditions precedent to the effectivity of the bonds, since it was the
 defendants' duty to pay for the premiums as long as the bonds were
in force and effect. Finally, defendants' claim that they are not liable
under the Indemnity Agreements is also without merit since the
under of defendants under said Indemnity Agreements; includes the
payment of yearly pre for the bonds.
WHEREFORE, judgment is hereby rendered in favor of the plaintiff
and against the defendants, ordering the tsn the defendant to pay
the plaintiff, jointly and severally, the amount of P6,649.36 plus
interest at the legal rate from 27 July 1964 until fully paid and the
sum equivalent to 10% of the total amount due as and or attorney's
fees, and costs (pp. 92-94, ROA; p. 9, rec.).
Defendants-appellants appealed to the Court of Appeals. On March 20, 1975, the
Court of Appeals in a resolution certified the herein case to this Court after finding
that this case involves only errors or questions of law.
1. The proper determination of the liability of the surety and of the principal on the
bond must depend primarily upon the language of the bond itself. The bonds herein
were required by Section 1 of Rule 81 of the Rules of Court. While a bond is
nonetheless a contract because it is required by statute (Midland Co. vs. Broat 52 NW
972), said statutory bonds are construed in the light of the statute creating the
obligation secured and the purposes for which the bond is required, as expressed in
the statute (Michael vs. Logan, 52 NW 972; Squires vs. Miller, 138 NW 1062). The
statute which requires the giving of a bond becomes a part of the bond and imparts
into the bond any conditions prescribed by the statute (Scott vs. United States Fidelity
Co., 252 Ala 373, 41 So 2d 298; Employer's Liability Assurance Corp. vs. Lunt, 82 Ariz
320, 313 P2d 393).
The bonds in question herein contain practically the very same conditions in Sec. 1,
Rule 81 of the Rules of Court. Pertinent provision of the administrator's bonds is as
follows:
Therefore, if the said Pastor T. Quebrar faithfully prepares and
presents to the Court, within three months from the date of his
appointment, a correct inventory of all the property of the deceased
which may have come into his possession or into the possession of
any other person representing him according to law, if he
administers all the property of the deceased which at any time
comes into his possession or into the possession of any other person
representing him; faithfully pays all the debts, legacies, and
bequests which encumber said estate, pays whatever dividends
which the Court may decide should be paid, and renders a just and
true account of his administrations to the Court within a year or at
any other date that he may be required so to do, and faithfully
executes all orders and decrees of said Court, then in this case this
obligation shall be void, otherwise it shall remain full force and
effect (p. 9, 18, ROA p. 9, rec.).
Section 1 of Rule 81 of the Rules of Court requires the administrator/executor to put
up a bond for the purpose of indemnifying the creditors, heirs, legatees and the estate.
It is conditioned upon the faithful performance of the administrator's trust (Mendoza
vs. Pacheco, 64 Phil. 134).
Having in mind the purpose and intent of the law, the surety is then liable under the
administrator's bond, for as long as the administrator has duties to do as such
administrator/executor. Since the liability of the sureties is co-extensive with that of
the administrator and embraces the performance of every duty he is called upon to
perform in the course of administration (Deobold vs. Oppermann, 111 NY 531, 19 NE
94), it follows that the administrator is still duty bound to respect the indemnity
agreements entered into by him in consideration of the suretyship
It is shown that the defendant-appellant Pastor T. Quebrar, still had something to do
as an administrator/executor even after the approval of the amended project of
partition and accounts on June 6, 1957.
The contention of the defendants-appellants that the administrator's bond ceased to
be of legal force and effect with the approval of the project of partition and statement
of accounts on June 6, 1957 is without merit. The defendant-appellant Pastor T.
Quebrar did not cease as administrator after June 6, 1957, for administration is for the
purpose of liquidation of the estate and distribution of the residue among the heirs
and legatees. And liquidation means the determination of all the assets of the estate
and payment of all the debts and expenses (Flores vs. Flores, 48 Phil. 982). It appears
that there were still debts and expenses to be paid after June 6, 1957.
And in the case of Montemayor vs. Gutierrez (114 Phil. 95), an estate may be
partitioned even before the termination of the administration proceedings. Hence,
the approval of the project of partition did not necessarily terminate the
administration proceedings. Notwithstanding the approval of the partition, the Court
of First Instance of Negros Occidental still had jurisdiction over the administration
proceedings of the estate of A.B. Chinsuy and Cresenciana Lipa.
2. The sureties of an administration bond are liable only as a rule, for matters occurring
during the term covered by the bond. And the term of a bond does not usually expire
until the administration has been closed and terminated in the manner directed by
law (Hartford Accident and Indemnity Co. vs. White, 115 SW 2d 249). Thus, as long as
the probate court retains jurisdiction of the estate, the bond contemplates a
continuing liability (Deobold vs. Oppermann, supra) notwithstanding the non-renewal
of the bond by the defendants-appellants.
It must be remembered that the probate court possesses an all-embracing power over
the administrator's bond and over the administration proceedings and it cannot be
devoid of legal authority to execute and make that bond answerable for the every
purpose for which it was filed (Mendoza vs. Pacheco, 64 Phil. 1-05). It is the duty of
the courts of probate jurisdiction to guard jealously the estate of the deceased
persons by intervening in the administration thereof in order to remedy or repair any
injury that may be done thereto (Dariano vs. Fernandez Fidalgo, 14 Phil. 62, 67; Sison
vs. Azarraga, 30 Phil. 129, 134).
3. In cases like these where the pivotal point is the interpretation of the contracts
entered into, it is essential to scrutinize the very language used in the contracts. The
two Indemnity Agreements provided that:
The undersigned, Pastor T. Quebrar and Dr. Francisco Kilayko, jointly
and severally, bind ourselves unto the Luzon Surety Co., Inc. ... in
consideration of it having become SURETY upon Civil Bond in the
sum of Fifteen Thousand Pesos (P15,000.00) ... in favor of the
Republic of the Philippines in Special Proceeding ... dated August 9,
1954, a copy of which is hereto attached and made an integral part
hereof (emphasis supplied; pp. 12-13, 21, ROA p. 9, rec.),
To separately consider these two agreements would then be contrary to the intent of
the parties in making them integrated as a whole.
The contention then of the defendants-appellants that both the Administrator's Bonds
and the Indemnity Agreements ceased to have any force and effect, the former since
June 6, 1957 with the approval of the project of partition and the latter since August
9, 1955 with the non-payment of the stated premiums, is without merit. Such
construction of the said contracts entered into would render futile the purpose for
which they were made.
To allow the defendants-appellants to evade their liability under the Indemnity
Agreements by non-payment of the premiums would ultimately lead to giving the
administrator the power to diminish or reduce and altogether nullify his liability under
the Administrator's Bonds. As already stated, this is contrary to the intent and purpose
of the law in providing for the administrator's bonds for the protection of the
creditors, heirs, legatees, and the estate.
4. Moreover, the lower court was correct in holding that there is no merit in the
defendants' claim that payments of premiums and documentary stamps are
conditions precedent to the effectivity of the bonds.
It is worthy to note that there is no provision or condition in the bond to the effect
that it will terminate at the end of the first year if the premium for continuation
thereafter is not paid. And there is no clause by which its obligation is avoided or even
suspended by the failure of the obligee to pay an annual premium (U.S. vs. Maryland
Casualty Co. DCMD 129 F. Supp; Dale vs. Continental Insurance Co., 31 SW 266;
Equitable Insurance C. vs. Harvey, 40 SW 1092).
It was held in the case of Fourth and First Bank and Trust Co. vs. Fidelity and Deposit
Co. (281 SW 785), that "at the end of the first year, the bond went on, whether or not
the premium was paid or not ... Even on a failure to pay an annual premium, the
contract ran on until affirmative action was taken to avoid it. The obligation of the
bond was therefore continuous." And in United States vs. American Surety Co. of New
York (172 F2d 135), it was held that "under a surety bond securing faithful
performance of duties by postal employee, liability for default of employee occurring
in any one year would continue, whether or not a renewal premium was paid for a
later year."
The payment of the annual premium is to be enforced as part of the consideration,
and not as a condition Woodfin vs. Asheville Mutual Insurance Co., 51 N.C. 558); for
the payment was not made a condition to the attaching or continuing of the contract
(National Bank vs. National Surety Co., 144 A 576). The premium is the consideration
for furnishing the bonds and the obligation to pay the same subsists for as long as the
liability of the surety shall exist (Reparations Commission vs. Universal Deep-Sea
Fishing Corp., L-21996, 83 SCRA 764, June 27, 1978). And in Arranz vs. Manila Fidelity
and Surety Co., Inc. (101 Phil. 272), the "premium is the consideration for furnishing
the bond or the guaranty. While the liability of the surety subsists the premium is
collectible from the principal. Lastly, in Manila Surety and Fidelity Co., Inc. vs. Villarama
(107 Phil. 891), it was held that "the one-year period mentioned therein refers not to
the duration or lifetime of the bond, but merely to the payment of premiums, and,
consequently, does not affect at all the effectivity or efficacy of such bond. But such
non- payment alone of the premiums for the succeeding years ... does not necessarily
extinguish or terminate the effectivity of the counter-bond in the absence of an
express stipulation in the contract making such non-payment of premiums a cause for
the extinguishment or termination of the undertaking. ...There is no necessity for an
extension or renewal of the agreement because by specific provision thereof, the
duration of the counter-bond was made dependent upon the existence of the original
bond."
5. It is true that in construing the liability of sureties, the principle of strictissimi juris
applies (Asiatic Petroleum Co. vs, De Pio, 46 Phil. 167; Standard Oil Co. of N.Y. vs. Cho
Siong, 53 Phil. 205); but with the advent of corporate surety, suretyship became
regarded as insurance where, usually, provisions are interpreted most favorably to the
insured and against the insurer because ordinarily the bond is prepared by the insurer
who then has the opportunity to state plainly the term of its obligation (Surety Co. vs.
Pauly, 170 US 133, 18 S. Ct. 552.,42 L. Ed. 972).

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

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

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

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

Concepcion, Jr., Guerrero, Abad Santos, De Castro and Escolin, JJ., concur.

Aquino, J., took no part.

G.R. No. L-6363 September 15, 1955
In the matter of the testate estate of Dr. Maximo Borromeo. JOHANNA HOFER
BORROMEO, widow-appelle,
vs.
CANUTO O. BORROMEO, executor-appellant.
Borromeo, Yat and Borromeo for appellant.
Tañada, Pelaez and Teehankee for appellee.
BENGZON, Acting C. J.:
In July 1948, Dr. Maximo Borromeo, a resident of Cebu City, died without ascendants
or descendants, but leaving his widow Johanna Hofer Borromeo, and a will wherein
he designated the Borromeo Bros. Estate Inc. as his sole heir, even as he named his
brother Canuto O. Borromeo as the executor. The said corporation is owned entirely
by the deceased and his brothers and sisters.
Proceedings having been instituted, the court of first instance of that province
probated the will in due course, and granted letters testamentary to Canuto O.
Borromeo, who duly qualified as such executor.
Thereafter, on July 11, 1949, the attorneys for the widow submitted an "Urgent
Motion" whereby they prayed for the removal of the executor on the grounds of
negligence in the performance of his duties and unfitness to continue discharging the
powers of the office.
This motion was scheduled to be heard on July 13, 1949 but it was postponed upon
representations by the executor of possible amicable settlement between the
opposing parties. No settlement was carried out nor even attempted. However, taking
advantage of the postponement and after a subpoena had been served on the Bank
of the Philippine Islands seeking information on the cash deposits therein of the
deceased Maximo Borromeo, the executor withdrew, without any authority from the
court, the total amount of P23,930.39 from a joint current account, in said Bank, of
Canuto Borromeo and Maximo Borromeo, and then deposited P22,244.39 of the sum
thus withdrawn in the joint account of said Canuto Borromeo and his brother Exequiel.
In time the petition was heard, and voluminous evidence, oral and documentary, was
submitted. Thereafter on February 21, 1951 the Honorable Edmundo Piccio, Judge,
for several reasons, one of them the above withdrawal of funds, decreed the removal
of the executor. On motion for reconsideration the executor's attorney prayed that
the order be revoked or that at least, the executor be permitted to resign. (Record on
Appeal p. 251.)
On March 29, 1951 obviously to accommodate the executor—there being no practical
difference between removal and resignation—His Honor modified his order in the
sense that said executor was "relieved of (instead of removed from) his commitments
as such executor". Notwithstanding such modification the executor appealed,
contending that the modified order should be revoked.
There is no question that the order removing the executor or administrator is
appealable.1 But we fail to perceive the utility of the instant appeal,2 inasmuch as the
executor begged to be permitted to resign and the court all but granted his request
explaining, specifically, that the executor was not removed but only relieved of his
commitment—which is one way of accepting the proffered resignation. The executor
got substantially what he wanted.
Granting that the modified order was not literally what he desired, still the error, if
any, did not affect his substantial rights, and could not justify reversal under the Rules.
(cf. Rule 53 sec. 3.)
In any event, supposing he was removed, there were in our opinion sufficient grounds
therefor. Take the matter of withdrawals above described. Attempting to justify his
attitude, the executor point out that, according to the joint deposit agreement Exhibit
H signed by Canuto and Maximo Borromeo.
We, the undersigned, agree with one another and with the Bank of the
Philippine Islands hereinafter called the Bank, that all moneys heretofore,
now, or hereafter deposited, by us, or any of us, to the credit of this Savings
Account or Current Account, are and shall be received and held by the Bank
with the understanding, and upon the condition that said money deposited,
without reference to previous ownerships, and all interest, dividends and
credits thereon shall be the property of all of us, during our lifetimes and
after the death of any one of us shall be the sole property of and payable to
the survivors, or survivor, provided that this last deposition is not contrary to
provisions of laws now in force or may hereafter be in force in the Philippine
Islands.(Emphasis our.)
He claims, in effect, that the money deposited was his at the time he withdrew it. But
would the Bank have allowed him to withdraw the whole amount if he were not the
executor? He got it then as executor. Instead, he deposited it in a joint account with
his brother Exequiel, thereby placing it at the latter's disposal, and hiding it from the
widow.
Furthermore, and this is important, the agreement says "provided that this last
disposition is not contrary to provisions of laws now in force . . . in the P.I." The
question arises: may a husband validly agree that upon his death certain conjugal
money deposited in the bank shall belong to his brother, and thereby deprive his wife
of her share in the conjugal partnership?
According to Art. 1413 of the Civil Code, no alienation or agreement which the
husband may make with respect to conjugal property in fraud of the wife shall
prejudice her or her heirs.3
There is at least some ground to doubt whether the stipulation could deprive the wife
of her share in the conjugal assets. The validity of the agreement could properly be
the subject of debate in court; yet this executor avoided or bypassed judicial
adjudication by getting the money, specially at a time when his actuations were
already being questioned, and his appointment as executor in danger of revocation.
And his conduct is aggravated by the circumstance that he took advantage of a
postponement, asked by him on the false pretense of possible amicable settlement,
in order to vest in himself money on which the corporate heir and the widow might
have a claim.
Another reason for the withdrawal is the fact that in his Report for March 1949 the
executor omitted to include, as income of the estate, the sum of P6,000 which he had
received from Hacienda Plaridel of the decedent. This in itself might be involuntary
error, as claimed by him. But considering that he received other sums of P13,010 and
P10,559.40 as proceeds from the farm of the deceased, but instead of depositing them
in his name as executor, placed them in his joint account with his brother Exequiel
Borromeo, it is not unreasonable to suspect a plan—inconsistent with his
trusteeship—to conceal the money of the deceased to back up his assertion, in
objecting to the widow's allowance, that the estate had no funds.
A third reason is that the executor claimed as his own certain shares of the Interisland
Gas Service, in the name of Maximo Borromeo, valued at P12,000; he asserted that
Maximo was merely his "dummy". If we had any doubts about the rightness of the trial
judges determination, this circumstance should finally tip the judicial balance on the
side of removal or resignation. Conflict between the interest of the executor and the
interest of the deceased is ground for removal or resignation of the former, who was
thereby become insuitable to discharge the trust. (Section 2, Rule 83.)
An executor or administrator should be removed where his personal
interests conflict with his official duties, but a mere hostile feeling towards
persons interested in the estate is not ground for removal unless it prevents
the management of the estate according to the dictates of prudence. (33 C.
J. S. P. 1036.) (Citing many cases.)
Reasons for rule.—"An executor is a quasi trustee, who should be indifferent
between the estate and claimant of the property, except to preserve it for
due administration, and when his interest conflicts with such right and duty
the country court, in the exercise of a sound discretion, may remove him."
(In re Manser, 60 Or. 240, 246, 118, p. 1024.)
An executor will be removed where it appears that he asserts claims against
the estate of the testator to the extent of two-thirds of the value of the
estate, and such claims are disputed by the beneficiary under the will."
(Henry's Est., 54 Pa. Super. 274.)
Claim of gifts from decedents.—Where an executor, in answer to a petition
for his removal on the ground of maladministration in claiming property of
the estate, alleged a gift by decedent to him of the property, he manifested
an interest adverse to the beneficiaries, authorizing his removal; but the
country court had no jurisdiction to determine the question of gift. (In re
Manser, 60 Or, 240, 118, p. 1024.)
It becomes unnecessary to examine the other reasons which induced the trial court
to let this executor go. The record discloses sufficient data justifying the decree of
separation or vindicating the judge's exercise of discretion. This, apart from the
principle supported by the weight of authorities that, "An appellate court is disinclined
to interfere with the action taken by the probate court in the matter of the removal
of an executor or administrator unless positive error or gross abuse of discretion is
shown." (33 C. J. S. p. 1048.) (Citing many cases.)1âwphïl.nêt
Wherefore, the appealed order should be, as it is hereby, affirmed with double costs
against appellant. It should be stated in this connection that the obvious reasons, no
petition for extension of the time to file a motion for reconsideration will be favorably
entertained. So ordered.
Padilla, Labrador, Jugo, Bautista Angelo, Reyes, A., Concepcion, and Reyes, J. B. L. JJ.,
concur.
G.R. No. 187879 July 5, 2010
DALISAY E. OCAMPO, VINCE E. OCAMPO, MELINDA CARLA E. OCAMPO, and LEONARDO
E. OCAMPO, JR., Petitioners,
vs.
RENATO M. OCAMPO and ERLINDA M. OCAMPO, Respondents.
DECISION
NACHURA, J.:
This petition1 for review on certiorari under Rule 45 of the Rules of Court seeks to
reverse and set aside the Decision2 dated December 16, 2008 and the Resolution3
dated April 30, 2009 of the Court of Appeals (CA) in CA-G.R. SP No. 104683. The
Decision annulled and set aside the Order dated March 13, 20084 of the Regional Trial
Court (RTC), Branch 24, Biñan, Laguna, in Sp. Proc. No. B-3089; while the Resolution
denied the motion for reconsideration of the Decision.
The Antecedents
Petitioners Dalisay E. Ocampo (Dalisay), Vince E. Ocampo (Vince), Melinda Carla E.
Ocampo (Melinda), and Leonardo E. Ocampo, Jr. (Leonardo, Jr.) are the surviving wife
and the children of Leonardo Ocampo (Leonardo), who died on January 23, 2004.
Leonardo and his siblings, respondents Renato M. Ocampo (Renato) and Erlinda M.
Ocampo (Erlinda) are the legitimate children and only heirs of the spouses Vicente and
Maxima Ocampo, who died intestate on December 19, 1972 and February 19, 1996,
respectively. Vicente and Maxima left several properties, mostly situated in Biñan,
Laguna. Vicente and Maxima left no will and no debts.
On June 24, 2004, five (5) months after the death of Leonardo, petitioners initiated a
petition for intestate proceedings, entitled "In Re: Intestate Proceedings of the Estate
of Sps. Vicente Ocampo and Maxima Mercado Ocampo, and Leonardo M. Ocampo,"
in the RTC, Branch 24, Biñan, Laguna, docketed as Spec. Proc. No. B-3089.5 The
petition alleged that, upon the death of Vicente and Maxima, respondents and their
brother Leonardo jointly controlled, managed, and administered the estate of their
parents. Under such circumstance, Leonardo had been receiving his share consisting
of one-third (1/3) of the total income generated from the properties of the estate.
However, when Leonardo died, respondents took possession, control and
management of the properties to the exclusion of petitioners. The petition prayed for
the settlement of the estate of Vicente and Maxima and the estate of Leonardo. It,
likewise, prayed for the appointment of an administrator to apportion, divide, and
award the two estates among the lawful heirs of the decedents.
Respondents filed their Opposition and Counter-Petition dated October 7, 2004,6
contending that the petition was defective as it sought the judicial settlement of two
estates in a single proceeding. They argued that the settlement of the estate of
Leonardo was premature, the same being dependent only upon the determination of
his hereditary rights in the settlement of his parents’ estate. In their counter-petition,
respondents prayed that they be appointed as special joint administrators of the
estate of Vicente and Maxima.
In an Order dated March 4, 2005,7 the RTC denied respondents’ opposition to the
settlement proceedings but admitted their counter-petition. The trial court also
clarified that the judicial settlement referred only to the properties of Vicente and
Maxima.
Through a Motion for Appointment of Joint Special Administrators dated October 11,
2005,8 respondents reiterated their prayer for appointment as special joint
administrators of the estate, and to serve as such without posting a bond.
In their Comment dated November 3, 2005,9 petitioners argued that, since April 2002,
they had been deprived of their fair share of the income of the estate, and that the
appointment of respondents as special joint administrators would further cause
injustice to them. Thus, they prayed that, in order to avoid further delay, letters of
administration to serve as joint administrators of the subject estate be issued to
respondents and Dalisay.
In another Motion for Appointment of a Special Administrator dated December 5,
2005,10 petitioners nominated the Biñan Rural Bank to serve as special administrator
pending resolution of the motion for the issuance of the letters of administration.
In its June 15, 2006 Order,11 the RTC appointed Dalisay and Renato as special joint
administrators of the estate of the deceased spouses, and required them to post a
bond of ₱200,000.00 each.12
Respondents filed a Motion for Reconsideration dated August 1, 200613 of the Order,
insisting that Dalisay was incompetent and unfit to be appointed as administrator of
the estate, considering that she even failed to take care of her husband Leonardo
when he was paralyzed in 1997. They also contended that petitioners’ prayer for
Dalisay’s appointment as special administrator was already deemed abandoned upon
their nomination of the Biñan Rural Bank to act as special administrator of the estate.
In their Supplement to the Motion for Reconsideration,14 respondents asserted their
priority in right to be appointed as administrators being the next of kin of Vicente and
Maxima, whereas Dalisay was a mere daughter-in-law of the decedents and not even
a legal heir by right of representation from her late husband Leonardo.
Pending the resolution of the Motion for Reconsideration, petitioners filed a Motion
to Submit Inventory and Accounting dated November 20, 2006,15 praying that the RTC
issue an order directing respondents to submit a true inventory of the estate of the
decedent spouses and to render an accounting thereof from the time they took over
the collection of the income of the estate.
Respondents filed their Comment and Manifestation dated January 15, 2007, 16
claiming that they could not yet be compelled to submit an inventory and render an
accounting of the income and assets of the estate inasmuch as there was still a
pending motion for reconsideration of the June 15, 2006 Order appointing Dalisay as
co-special administratrix with Renato.
In its Order dated February 16, 2007, the RTC revoked the appointment of Dalisay as
co-special administratrix, substituting her with Erlinda. The RTC took into
consideration the fact that respondents were the nearest of kin of Vicente and
Maxima. Petitioners did not contest this Order and even manifested in open court
their desire for the speedy settlement of the estate.
On April 23, 2007, or two (2) months after respondents’ appointment as joint special
administrators, petitioners filed a Motion for an Inventory and to Render Account of
the Estate,17 reiterating their stance that respondents, as joint special administrators,
should be directed to submit a true inventory of the income and assets of the estate.
Respondents then filed a Motion for Exemption to File Administrators’ Bond 18 on May
22, 2007, praying that they be allowed to enter their duties as special administrators
without the need to file an administrators’ bond due to their difficulty in raising the
necessary amount. They alleged that, since petitioners manifested in open court that
they no longer object to the appointment of respondents as special co-administrators,
it would be to the best interest of all the heirs that the estate be spared from incurring
unnecessary expenses in paying for the bond premiums. They also assured the RTC
that they would faithfully exercise their duties as special administrators under pain of
contempt should they violate any undertaking in the performance of the trust of their
office.
In an Order dated June 29, 2007,19 the RTC directed the parties to submit their
respective comments or oppositions to the pending incidents, i.e., petitioners’ Motion
for Inventory and to Render Account, and respondents’ Motion for Exemption to File
Administrators’ Bond.
Respondents filed their Comment and/or Opposition,20 stating that they have already
filed a comment on petitioners’ Motion for Inventory and to Render Account. They
asserted that the RTC should, in the meantime, hold in abeyance the resolution of this
Motion, pending the resolution of their Motion for Exemption to File Administrators’
Bond.
On October 15, 2007, or eight (8) months after the February 16, 2007 Order
appointing respondents as special joint administrators, petitioners filed a Motion to
Terminate or Revoke the Special Administration and to Proceed to Judicial Partition or
Appointment of Regular Administrator.21 Petitioners contended that the special
administration was not necessary as the estate is neither vast nor complex, the
properties of the estate being identified and undisputed, and not involved in any
litigation necessitating the representation of special administrators. Petitioners,
likewise, contended that respondents had been resorting to the mode of special
administration merely to delay and prolong their deprivation of what was due them.
Petitioners cited an alleged fraudulent sale by respondents of a real property for
₱2,700,000.00, which the latter represented to petitioners to have been sold only for
₱1,500,000.00, and respondents’ alleged misrepresentation that petitioners owed the
estate for the advances to cover the hospital expenses of Leonardo, but, in fact, were
not yet paid.
Respondents filed their Opposition and Comment22 on March 10, 2008, to which, in
turn, petitioners filed their Reply to Opposition/Comment23 on March 17, 2008.
In its Order dated March 13, 2008,24 the RTC granted petitioners’ Motion, revoking
and terminating the appointment of Renato and Erlinda as joint special administrators,
on account of their failure to comply with its Order, particularly the posting of the
required bond, and to enter their duties and responsibilities as special administrators,
i.e., the submission of an inventory of the properties and of an income statement of
the estate. The RTC also appointed Melinda as regular administratrix, subject to the
posting of a bond in the amount of ₱200,000.00, and directed her to submit an
inventory of the properties and an income statement of the subject estate. The RTC
likewise found that judicial partition may proceed after Melinda had assumed her
duties and responsibilities as regular administratrix.
Aggrieved, respondents filed a petition for certiorari 25 under Rule 65 of the Rules of
Court before the CA, ascribing grave abuse of discretion on the part of the RTC in (a)
declaring them to have failed to enter the office of special administration despite lapse
of reasonable time, when in truth they had not entered the office because they were
waiting for the resolution of their motion for exemption from bond; (b) appointing
Melinda as regular administratrix, a mere granddaughter of Vicente and Maxima,
instead of them who, being the surviving children of the deceased spouses, were the
next of kin; and (c) declaring them to have been unsuitable for the trust, despite lack
of hearing and evidence against them.
Petitioners filed their Comment to the Petition and Opposition to Application for
temporary restraining order and/or writ of preliminary injunction, 26 reiterating their
arguments in their Motion for the revocation of respondents’ appointment as joint
special administrators. Respondents filed their Reply.27
On December 16, 2008, the CA rendered its assailed Decision granting the petition
based on the finding that the RTC gravely abused its discretion in revoking
respondents’ appointment as joint special administrators without first ruling on their
motion for exemption from bond, and for appointing Melinda as regular administratrix
without conducting a formal hearing to determine her competency to assume as such.
According to the CA, the posting of the bond is a prerequisite before respondents
could enter their duties and responsibilities as joint special administrators, particularly
their submission of an inventory of the properties of the estate and an income
statement thereon.
Petitioners filed a Motion for Reconsideration of the Decision.28 The CA, however,
denied it. Hence, this petition, ascribing to the CA errors of law and grave abuse of
discretion for annulling and setting aside the RTC Order dated March 13, 2008.
Our Ruling
The pertinent provisions relative to the special administration of the decedents’ estate
under the Rules of Court provide—
Sec. 1. Appointment of special administrator. – When there is delay in granting letters
testamentary or of administration by any cause including an appeal from the
allowance or disallowance of a will, the court may appoint a special administrator to
take possession and charge of the estate of the deceased until the questions causing
the delay are decided and executors or administrators appointed.29
Sec. 2. Powers and duties of special administrator. – Such special administrator shall
take possession and charge of goods, chattels, rights, credits, and estate of the
deceased and preserve the same for the executor or administrator afterwards
appointed, and for that purpose may commence and maintain suits as administrator.
He may sell only such perishable and other property as the court orders sold. A special
administrator shall not be liable to pay any debts of the deceased unless so ordered
by the court.30
Sec. 1. Bond to be given before issuance of letters; Amount; Conditions. – Before an
executor or administrator enters upon the execution of his trust, and letters
testamentary or of administration issue, he shall give a bond, in such sum as the court
directs, conditioned as follows:
(a) To make and return to the court, within three (3) months, a true and
complete inventory of all goods, chattels, rights, credits, and estate of the
deceased which shall come to his possession or knowledge or to the
possession of any other person for him;
(b) To administer according to these rules, and, if an executor, according to
the will of the testator, all goods, chattels, rights, credits, and estate which
shall at any time come to his possession or to the possession of any other
person for him, and from the proceeds to pay and discharge all debts,
legacies, and charges on the same, or such dividends thereon as shall be
decreed by the court;
(c) To render a true and just account of his administration to the court within
one (1) year, and at any other time when required by the court;
(d) To perform all orders of the court by him to be performed.31
Sec. 4. Bond of special administrator. – A special administrator before entering upon
the duties of his trust shall give a bond, in such sum as the court directs, conditioned
that he will make and return a true inventory of the goods, chattels, rights, credits,
and estate of the deceased which come to his possession or knowledge, and that he
will truly account for such as are received by him when required by the court, and will
deliver the same to the person appointed executor or administrator, or to such other
person as may be authorized to receive them.32
Inasmuch as there was a disagreement as to who should be appointed as
administrator of the estate of Vicente and Maxima, the RTC, acting as a probate court,
deemed it wise to appoint joint special administrators pending the determination of
the person or persons to whom letters of administration may be issued. The RTC was
justified in doing so considering that such disagreement caused undue delay in the
issuance of letters of administration, pursuant to Section 1 of Rule 80 of the Rules of
Court. Initially, the RTC, on June 15, 2006, appointed Renato and Dalisay as joint
special administrators, imposing upon each of them the obligation to post an
administrator’s bond of ₱200,000.00. However, taking into account the arguments of
respondents that Dalisay was incompetent and unfit to assume the office of a special
administratrix and that Dalisay, in effect, waived her appointment when petitioners
nominated Biñan Rural Bank as special administrator, the RTC, on February 16, 2007,
revoked Dalisay’s appointment and substituted her with Erlinda.
A special administrator is an officer of the court who is subject to its supervision and
control, expected to work for the best interest of the entire estate, with a view to its
smooth administration and speedy settlement.33 When appointed, he or she is not
regarded as an agent or representative of the parties suggesting the appointment. 34
The principal object of the appointment of a temporary administrator is to preserve
the estate until it can pass to the hands of a person fully authorized to administer it
for the benefit of creditors and heirs, pursuant to Section 2 of Rule 80 of the Rules of
Court.35
While the RTC considered that respondents were the nearest of kin to their deceased
parents in their appointment as joint special administrators, this is not a mandatory
requirement for the appointment. It has long been settled that the selection or
removal of special administrators is not governed by the rules regarding the selection
or removal of regular administrators.36 The probate court may appoint or remove
special administrators based on grounds other than those enumerated in the Rules at
its discretion, such that the need to first pass upon and resolve the issues of fitness or
unfitness37 and the application of the order of preference under Section 6 of Rule 78,38
as would be proper in the case of a regular administrator, do not obtain. As long as
the discretion is exercised without grave abuse, and is based on reason, equity, justice,
and legal principles, interference by higher courts is unwarranted.39 The appointment
or removal
of special administrators, being discretionary, is thus interlocutory and may be
assailed through a petition for certiorari under Rule 65 of the Rules of Court.40
Granting the certiorari petition, the CA found that the RTC gravely abused its
discretion in revoking respondents’ appointment as joint special administrators, and
for failing to first resolve the pending Motion for Exemption to File Administrators’
Bond, ratiocinating that the posting of the administrators’ bond is a pre-requisite to
respondents’ entering into the duties and responsibilities of their designated office.
This Court disagrees.
It is worthy of mention that, as early as October 11, 2005, in their Motion for
Appointment as Joint Special Administrators, respondents already prayed for their
exemption to post bond should they be assigned as joint special administrators.
However, the RTC effectively denied this prayer when it issued its June 15, 2006 Order,
designating Renato and Dalisay as special administrators and enjoining them to post
bond in the amount of ₱200,000.00 each. This denial was, in effect, reiterated when
the RTC rendered its February 16, 2007 Order substituting Dalisay with Erlinda as
special administratrix.
Undeterred by the RTC’s resolve to require them to post their respective
administrators’ bonds, respondents filed anew a Motion for Exemption to File
Administrators’ Bond on May 22, 2007, positing that it would be to the best interest
of the estate of their deceased parents and all the heirs to spare the estate from
incurring the unnecessary expense of paying for their bond premiums since they could
not raise the money themselves. To note, this Motion was filed only after petitioners
filed a Motion for an Inventory and to Render Account of the Estate on April 23, 2007.
Respondents then argued that they could not enter into their duties and
responsibilities as special administrators in light of the pendency of their motion for
exemption. In other words, they could not yet submit an inventory and render an
account of the income of the estate since they had not yet posted their bonds.
Consequently, the RTC revoked respondents’ appointment as special administrators
for failing to post their administrators’ bond and to submit an inventory and
accounting as required of them, tantamount to failing to comply with its lawful orders.
Inarguably, this was, again, a denial of respondents’ plea to assume their office sans a
bond. The RTC rightly did so.
Pursuant to Section 1 of Rule 81, the bond secures the performance of the duties and
obligations of an administrator namely: (1) to administer the estate and pay the debts;
(2) to perform all judicial orders; (3) to account within one (1) year and at any other
time when required by the probate court; and (4) to make an inventory within three
(3) months. More specifically, per Section 4 of the same Rule, the bond is conditioned
on the faithful execution of the administration of the decedent’s estate requiring the
special administrator to (1) make and return a true inventory of the goods, chattels,
rights, credits, and estate of the deceased which come to his possession or knowledge;
(2) truly account for such as received by him when required by the court; and (3)
deliver the same to the person appointed as executor or regular administrator, or to
such other person as may be authorized to receive them.
Verily, the administration bond is for the benefit of the creditors and the heirs, as it
compels the administrator, whether regular or special, to perform the trust reposed
in, and discharge the obligations incumbent upon, him. Its object and purpose is to
safeguard the properties of the decedent, and, therefore, the bond should not be
considered as part of the necessary expenses chargeable against the estate, not being
included among the acts constituting the care, management, and settlement of the
estate. Moreover, the ability to post the bond is in the nature of a qualification for the
office of administration.41
Hence, the RTC revoked respondents’ designation as joint special administrators,
especially considering that respondents never denied that they have been in
possession, charge, and actual administration of the estate of Vicente and Maxima
since 2002 up to the present, despite the assumption of Melinda as regular
administratrix. In fact, respondents also admitted that, allegedly out of good faith and
sincerity to observe transparency, they had submitted a Statement of Cash
Distribution42 for the period covering April 2002 to June 2006,43 where they indicated
that Renato had received ₱4,241,676.00, Erlinda ₱4,164,526.96, and petitioners
₱2,486,656.60, and that the estate had advanced ₱2,700,000.00 for the hospital and
funeral expenses of Leonardo.44 The latter cash advance was questioned by
petitioners in their motion for revocation of special administration on account of the
demand letter45 dated June 20, 2007 of Asian Hospital and Medical Center addressed
to Dalisay, stating that there still remained unpaid hospital bills in the amount of
₱2,087,380.49 since January 2004. Undeniably, respondents had already been
distributing the incomes or fruits generated from the properties of the decedents’
estate, yet they still failed to post their respective administrators’ bonds despite
collection of the advances from their supposed shares. This state of affairs continued
even after a considerable lapse of time from the appointment of Renato as a special
administrator of the estate on June 15, 2006 and from February 16, 2007 when the
RTC substituted Erlinda, for Dalisay, as special administratrix.
What is more, respondents’ insincerity in administering the estate was betrayed by
the Deed of Conditional Sale dated January 12, 2004 46 discovered by petitioners. This
Deed was executed between respondents, as the only heirs of Maxima, as vendors,
thus excluding the representing heirs of Leonardo, and Spouses Marcus Jose B.
Brillantes and Amelita Catalan-Brillantes, incumbent lessors, as vendees, over a real
property situated in Biñan, Laguna, and covered by Transfer Certificate of Title No. T-
332305 of the Registry of Deeds of Laguna, for a total purchase price of ₱2,700,000.00.
The Deed stipulated for a payment of ₱1,500,000.00 upon the signing of the contract,
and the balance of ₱1,200,000.00 to be paid within one (1) month from the receipt of
title of the vendees. The contract also stated that the previous contract of lease
between the vendors and the vendees shall no longer be effective; hence, the vendees
were no longer obligated to pay the monthly rentals on the property. And yet there is
a purported Deed of Absolute Sale47 over the same realty between respondents, and
including Leonardo as represented by Dalisay, as vendors, and the same spouses, as
vendees, for a purchase price of only ₱1,500,000.00. Notably, this Deed of Absolute
Sale already had the signatures of respondents and vendee-spouses. Petitioners
claimed that respondents were coaxing Dalisay into signing the same, while
respondents said that Dalisay already got a share from this transaction in the amount
of ₱500,000.00. It may also be observed that the time of the execution of this Deed of
Absolute Sale, although not notarized as the Deed of Conditional Sale, might not have
been distant from the execution of the latter Deed, considering the similar Community
Tax Certificate Numbers of the parties appearing in both contracts.
Given these circumstances, this Court finds no grave abuse of discretion on the part
of the RTC when it revoked the appointment of respondents as joint special
administrators, the removal being grounded on reason, equity, justice, and legal
principle. Indeed, even if special administrators had already been appointed, once the
probate court finds the appointees no longer entitled to its confidence, it is justified
in withdrawing the appointment and giving no valid effect thereto.48
On the other hand, the Court finds the RTC’s designation of Melinda as regular
administratrix improper and abusive of its discretion.
In the determination of the person to be appointed as regular administrator, the
following provisions of Rule 78 of the Rules of Court, state –
Sec. 1. Who are incompetent to serve as executors or administrators. – No person is
competent to serve as executor or administrator who:
(a) Is a minor;
(b) Is not a resident of the Philippines; and
(c) Is in the opinion of the court unfit to execute the duties of the trust by
reason of drunkenness, improvidence, or want of understanding or integrity,
or by reason of conviction of an offense involving moral turpitude.
xxxx
Sec. 6. When and to whom letters of administration granted. – If no executor is named
in the will, or the executor or executors are incompetent, refuse the trust, or fail to
give bond, or a person dies intestate, administration shall be granted:
(a) To the surviving husband or wife, as the case may be, or next of kin, or
both, in the discretion of the court, or to such person as such surviving
husband or wife, or next of kin, requests to have appointed, if competent and
willing to serve;
(b) If such surviving husband or wife, as the case may be, or next of kin, or
the person selected by them, be incompetent or unwilling, or if the husband
or widow, or next of kin, neglects for thirty (30) days after the death of the
person to apply for administration or to request that administration be
granted to some other person, it may be granted to one or more of the
principal creditors, if competent and willing to serve;
(c) If there is no such creditor competent and willing to serve, it may be
granted to such other person as the court may select.
Further, on the matter of contest for the issuance of letters of administration, the
following provisions of Rule 79 are pertinent –
Sec. 2. Contents of petition for letters of administration. – A petition for letters of
administration must be filed by an interested person and must show, so far as known
to the petitioner:
 (a) The jurisdictional facts;
(b) The names, ages, and residences of the heirs, and the names and
residences of the creditors, of the decedent;
(c) The probable value and character of the property of the estate;
(d) The name of the person for whom letters of administration are prayed.
But no defect in the petition shall render void the issuance of letters of administration.
Sec. 3. Court to set time for hearing. Notice thereof. – When a petition for letters of
administration is filed in the court having jurisdiction, such court shall fix a time and
place for hearing the petition, and shall cause notice thereof to be given to the known
heirs and creditors of the decedent, and to any other persons believed to have an
interest in the estate, in the manner provided in Sections 3 and 4 of Rule 76.
Sec. 4. Opposition to petition for administration. – Any interested person may, by filing
a written opposition, contest the petition on the ground of the incompetency of the
person for whom letters are prayed therein, or on the ground of the contestant’s own
right to the administration, and may pray that letters issue to himself, or to any
competent person or persons named in the opposition.
Sec. 5. Hearing and order for letters to issue. – At the hearing of the petition, it must
first be shown that notice has been given as herein-above required, and thereafter
the court shall hear the proofs of the parties in support of their respective allegations,
and if satisfied that the decedent left no will, or that there is no competent and willing
executor, it shall order the issuance of letters of administration to the party best
entitled thereto.1avvphi1
as such was not properly objected to by respondents despite being the next of kin to
the decedent spouses, and was not threshed out by the RTC acting as a probate court
in accordance with the above mentioned Rules.
However, having in mind the objective of facilitating the settlement of the estate of
Vicente and Maxima, with a view to putting an end to the squabbles of the heirs, we
take into account the fact that Melinda, pursuant to the RTC Order dated March 13,
2008, already posted the required bond of ₱200,000.00 on March 26, 2008, by virtue
of which, Letters of Administration were issued to her the following day, and that she
filed an Inventory of the Properties of the Estate dated April 15, 2008.50 These acts
clearly manifested her intention to serve willingly as administratrix of the decedents’
estate, but her appointment should be converted into one of special administration,
pending the proceedings for regular administration. Furthermore, since it appears
that the only unpaid obligation is the hospital bill due from Leonardo’s estate, which
is not subject of this case, judicial partition may then proceed with dispatch.
WHEREFORE, the petition is PARTIALLY GRANTED. The Decision dated December 16,
2008 and the Resolution dated April 30, 2009 of the Court of Appeals in CA-G.R. SP
No. 104683 are AFFIRMED with the MODIFICATION that the Order dated March 13,
2008 of the Regional Trial Court, Branch 24, Biñan, Laguna, with respect to the
revocation of the special administration in favor of Renato M. Ocampo and Erlinda M.
Ocampo, is REINSTATED. The appointment of Melinda Carla E. Ocampo as regular
administratrix is SET ASIDE. Melinda is designated instead as special administratrix of
the estate under the same administrator’s bond she had posted. The trial court is
directed to conduct with dispatch the proceedings for the appointment of the regular
administrator and, thereafter, to proceed with judicial partition. No costs.
SO ORDERED.

Admittedly, there was no petition for letters of administration with respect to

Melinda, as the prayer for her appointment as co-administrator was embodied in the
motion for the termination of the special administration. Although there was a hearing
set for the motion on November 5, 2007, the same was canceled and reset to February
8, 2008 due to the absence of the parties’ counsels. The February 8, 2008 hearing was
again deferred to March 10, 2008 on account of the ongoing renovation of the Hall of
Justice. Despite the resetting, petitioners filed a Manifestation/Motion dated February
29, 2008,49 reiterating their prayer for partition or for the appointment of Melinda as
regular administrator and for the revocation of the special administration. It may be
mentioned that, despite the filing by respondents of their Opposition and Comment
to the motion to revoke the special administration, the prayer for the appointment of
Melinda as regular administratrix of the estate was not specifically traversed in the
said pleading. Thus, the capacity, competency, and legality of Melinda’s appointment
G.R. No. L-23419 June 27, 1975
INTESTATE ESTATE OF THE DECEASED GELACIO SEBIAL. BENJAMINA SEBIAL, petitioner-
appellee,
vs.
ROBERTA SEBIAL, JULIANO SEBIAL and HEIRS OF BALBINA SEBIAL, oppositors-
appellants.
C. de la Victoria & L. de la Victoria for appellants.
Robustiano D. Dejaresco for appellee.
AQUINO, J.:
Gelacio Sebial died intestate in 1943 in Pinamungajan Cebu. According to the
appellants, Gelacio Sebial, by his first wife Leoncia Manikis, who allegedly died in 1919,
begot three children named Roberta, Balbina and Juliano. By his second wife, Dolores
Enad, whom he allegedly married in 1927, he supposedly begot six children named
Benjamina, Valentina, Ciriaco, Gregoria, Esperanza and Luciano.
On June 17, 1960 Benjamina Sebial filed in the Court of First Instance of Cebu a verified
petition for the settlement of Gelacio Sebial's estate. She prayed that she be
appointed administratrix thereof (Spec. Proc. No. 2049-R). Roberta Sebial opposed the
petition on the ground that the estate of Gelacio Sebial had already been partitioned
among his children and that, if an administration proceeding was necessary, she,
Roberta Sebial, a resident of Guimbawian, a remote mountain barrio of Pinamungajan,
where the decedent's estate was supposedly located, should be the one appointed
administratrix and not Benjamina Sebial, a housemaid working at Talisay, Cebu which
is about seventy kilometers away from Pinamungajan. In a supplemental opposition
the children of the first marriage contended that the remedy of Benjamina Sebial was
an action to rescind the partition.
After hearing, the lower court in its order of January 16, 1961 appointed Benjamina
Sebial as administratrix. It found that the decedent left an estate consisting of lands
with an area of twenty-one hectares, valued at more than six thousand pesos, and
that the alleged partition of the decedent's estate was invalid and ineffective.
Letters of administration were issued to Benjamina Sebial on January 19, 1961. On the
same date, a notice to creditors was issued. The oppositors moved for the
reconsideration of the order appointing Benjamina Sebial as administratrix. They
insisted that the decedent's estate had been partitioned on August 29, 1945, as shown
in Exhibits 5, 6, 7 and I, and that the action to rescind the partition had already
prescribed. The lower court denied the motion in its order of February 11, 1961.
The oppositors filed on March 16, 1961 a motion to terminate the administration
proceeding on the grounds that the decedent's estate was valued at less than six
thousand pesos and that it had already been partitioned and, therefore, there was no
necessity for the administration proceeding.
On April 27, 1961 Benjamina Sebial filed an inventory and appraisal of the decedent's
estate allegedly consisting of seven unregistered parcels of land, covered by Tax
Declarations Nos. 04477, 04478, 04490, 04491, 04492, 04493 and 04500, with a total
value of nine thousand pesos, all located at Barrio Guimbawian, Pinamungajan. The
oppositors registered their opposition to the inventory on the ground that the seven
parcels of land enumerated in the inventory no longer formed part of the decedent's
estate.
On May 6, 1961, the administratrix filed a motion to require Lorenzo Rematado,
Demetrio Camillo and the spouses Roberta Sebial and Lazaro Recuelo to deliver to her
the parcels of land covered by Tax Declarations Nos. 04478, 04490,04491 and 04493.
On June 24, 1961 the probate court issued an order suspending action on the pending
incidents in view of the possibility of an amicable settlement. It ordered the parties to
prepare a complete list of the properties belonging to the decedent, with a
segregation of the properties belonging to each marriage. Orders of the same tenor
were issued by the lower court on July 8 and October 28, 1961.
On November 11, 1961 the oppositors, Roberta Sebial, Juliano Sebial and the heirs of
Balbina Sebial, submitted their own inventory of the conjugal assets of Gelacio Sebial
and Leoncia Manikis, consisting of two parcels of land acquired in 1912 and 1915. They
alleged that the conjugal estate of Gelacio Sebial and Dolores Enad consisted of only
one parcel of land, containing an area of seven hectares, allegedly purchased with
money coming from the conjugal assets of Gelacio Sebial and Leoncia Manikis. They
further alleged that the said seven- hectare land was sold by the children of the second
marriage to Eduardo Cortado (Tax Declaration No. 2591).1äwphï1.ñët
The oppositors claimed that the aforementioned two parcels of land acquired during
the first marriage were partitioned in 1945 among (1) Roberta Sebial, (2) Juliano
Sebial, (3) Francisco Sebial as the representative of the estate of Balbina Sebial and (4)
Valentina Sebial as the representative of the six children of the second marriage, some
of whom were minors. They clarified that under that partition the three children of
the first marriage received a three-fourths share while the six children of second
marriage received a one-fourth share (Tax Declaration No. 06500). They also alleged
that Eduardo Cortado, Emilio Sialongo, Lorenzo Rematado and Lazaro Recuelo were
the third persons involved in the transfer of the lands pertaining to the estate of
Gelacio Sebial (Tax Declarations Nos. 04493, 06571 and 04471). To the inventory
submitted by the oppositors, the administratrix filed an opposition dated November
18, 1961.
In an order dated November 11, 1961 the lower court inexplicably required the
administratrix to submit another inventory. In compliance with that order she
submitted an inventory dated November 17, 1961, wherein she reproduced her
inventory dated April 17, 1961 and added two other items, namely, two houses
allegedly valued at P8,000 and the fruits of the properties amounting to P5,000
allegedly received by the children of the first marriage. The oppositor interposed an
opposition to the said inventory.
On November 24, 1961 the oppositors filed a "motion for revision of partition" which
was based on their own inventory dated November 7, 1961.
The lower court in its order of December 11, 1961 approved the second inventory
dated November, 7, 1961 because there was allegedly a "prima facie evidence to show
that" the seven parcels of land and two houses listed therein belonged to the
decedent's estate. In another order also dated December 11, 1961 the lower court
granted the motion of the administratrix dated May 4, 1961 for the delivery to her of
certain parcels of land and it directed that the heirs of Gelacio Sebial, who are in
possession of the parcels of land covered by Tax Declarations Nos. 04493, 04491,
04490 and 04478, should deliver those properties to the administratrix and should not
disturb her in her possession and administration of the same. The lower court denied
the oppositors' motion dated November 20, 1961 for "revision of partition".
On December 29, 1961 Roberta Sebial moved for the reconsideration of the two
orders on the grounds (1) that the court had no jurisdiction to approve an inventory
filed beyond the three-month period fixed in section 1, Rule 84 of the Rules of Court;
(2) that the said inventory is not supported by any documentary evidence because
there is no tax declaration at all in Gelacio Sebial's name; (3) that the two houses
mentioned in the inventory were nonexistent because they were demolished by the
Japanese soldiers in 1943 and the materials thereof were appropriated by the
administratrix and her brothers and sisters; (4) that the valuation of P17,000 indicated
in the inventory was fake, fictitious and fantastic since the total value of the seven
parcels of land amounted only to P3,080; (5) that Gelacio Sebial's estate should be
settled summarily because of its small value as provided in section 2, Rule 74 of the
Rules of Court and (6) that an ordinary action is necessary to recover the lands in the
possession of third persons.
The oppositors without awaiting the resolution of their motion for reconsideration
filed a notice of appeal from the two orders both dated December 11, 1961. The notice
of appeal was filed "without prejudice to the motion for reconsideration". Benjamina
Sebial opposed the motion for reconsideration. The lower court in its order of January
18, 1962 denied oppositors' motion for reconsideration. It approved Roberta Sebial's
amended record on appeal. The case was elevated to the Court of Appeals.
The Court of Appeals in its resolution of July 31, 1964 in CA-G.R. No. 31978.-R certified
the case to this Court because in its opinion the appeal involves only the legal issues
of (1) the construction to be given to section 2, Rule 74 and section 1, Rule 84 (now
Rule 83) of the Rules of Court and (2) whether an ordinary civil action for recovery of
property and not an administration proceeding is the proper remedy, considering
oppositors' allegation that the estate of Gelacio Sebial was partitioned in 1945 and
that some of his heirs had already sold their respective shares (Per Angeles, Gatmaitan
and Concepcion Jr., JJ.)
The Clerk of Court of the lower court in his letter of January 15, 1963, transmitting the
amended record on appeal, said "there was no presentation of evidence by either
parties concerning the two orders appealed from".
This case involves the conflicting claims of some humble folks from a remote rural area
in Cebu regarding some unregistered farm lands. Because of her poverty Roberta
Sebial wanted to appeal in forma pauperis. Her husband Lazaro Recuelo and her
nephew, Candelario Carrillo, in order to justify the filing of a mimeographed brief,
swore that their families subsisted on root crops because they could not afford to buy
corn grit or rice.
Oppositors' contention in their motion for reconsideration (not in their brief) that the
probate court had no jurisdiction to approve the inventory dated November 17, 1961
because the administratrix filed it after three months from the date of her
appointment is not well-taken. The three-month period prescribed in section 1, Rule
83 (formerly Rule 84) of the Rules of Court is not mandatory. After the filing of a
petition for the issuance of letters of administration and the publication of the notice
of hearing, the proper Court of First Instance acquires jurisdiction over a decedent's
estate and retains that jurisdiction until the proceeding is closed. The fact that an
inventory was filed after the three-month period would not deprive the probate court
of jurisdiction to approve it. However, an administrator's unexplained delay in filing
the inventory may be a ground for his removal (Sec. 2, Rule 82, Rules of Court).
The other contention of the oppositors that inasmuch as the value of the decedent's
estate is less than five thousand pesos and he had no debts, the estate could be settled
summarily under section 2, Rule 74 of the Rules of Court or that an administration
proceeding was not necessary (the limit of six thousand pesos was increased to ten
thousand pesos in section 2, Rule 74 effective on January 1, 1964) rests on a
controversial basis. While in the verified petition for the issuance of letters of
administration, it was alleged that the gross value of the decedent's estate was "not
more than five thousand pesos", in the amended inventory the valuation was P17,000.
Indeed, one of the lower court's omissions was its failure to ascertain by
preponderance of evidence the actual value of the estate, if there was still an estate
to be administered. The approval of the amended inventory was not such a
determination.
Anyway, in the present posture of the proceeding, no useful purpose would be served
by dismissing the petition herein and ordering that a new petition for summary
settlement be filed. Inasmuch as a regular administrator had been appointed and a
notice to creditors had been issued and no claims were filed, the probate court could
still proceed summarily and expeditiously to terminate the proceeding. With the
cooperation of the lawyers of the parties, it should strive to effect an amicable
settlement of the case (See arts. 222 and 2029, Civil Code).
If the efforts to arrive at an amicable settlement prove fruitless, then the probate court
should ascertain what assets constituted the estate of Gelacio Sebial, what happened
to those assets and whether the children of the second marriage (the petitioner was
a child of the second marriage and the principal oppositor was a child of first marriage)
could still have a share, howsoever small, in the decedent's estate.
The lower court's order of December 11, 1961, approving the amended inventory of
November 11, 1961, is not a conclusive determination of what assets constituted the
decedent's estate and of the valuations thereof. Such a determination is only
provisional in character and is without prejudice to a judgment in a separate action on
the issue of title or ownership (3 Moran's Comments on the Rules of Court, 1970 Ed.,
448-449).1äwphï1.ñët
The other order dated December 11, 1961 requires the delivery to the administratrix
of (1) two parcels of land covered by Tax Declarations Nos. 04491 and 04493 in the
possession of the spouses Lazaro Recuelo and Roberta Sebial, an oppositor-appellant;
(2) the parcel of land covered by Tax Declaration No. 04490 in the possession of
Lorenzo Rematado and (3) the parcel of land described under Tax Declaration No.
04478 in the possession of Demetrio Camillo (Canillo), a child of the deceased Balbina
Sebial, one of the three children of the first marriage.
We hold that the said order is erroneous and should be set aside because the probate
court failed to receive evidence as to the ownership of the said parcels of land. The
general rule is that questions of title to property cannot be passed upon in a testate
or intestate proceeding. However, when the parties are all heirs of the decedent, it is
optional upon them to submit to the probate court the question of title to property
and, when so submitted, the probate court may definitely pass judgment thereon (3
Moran's Comment's on the Rules of Court, 1970 Ed., pp. 448, 473; Alvarez vs. Espiritu,
L-18833, August 14, 1965, 14 SCRA 892).
Lorenzo Rematado and Lazaro Recuelo are not heirs of the decedent. They are third
persons. The rule is that matters affecting property under administration may be taken
cognizance of by the probate court in the course of the intestate proceedings provided
that the interests of third persons are not prejudiced (Cunanan vs. Amparo, 80 Phil.
227; Ibid, 3 Moran 473).
However, third persons to whom the decedent's assets had been fraudulently
conveyed may be cited to appear in court and be examined under oath as to how they
came into the possession of the decedent's assets (Sec. 6, Rule 87, Rules of Court) but
a separate action would be necessary to recover the said assets (Chanco vs.
Madrilejos, 12 Phil. 543; Guanco vs. Philippine National Bank, 54 Phil. 244).
The probate court should receive evidence on the discordant contentions of the
parties as to the assets of decedent's estate, the valuations thereof and the rights of
the transferees of some of the assets. The issue of prescription should also be
considered (see p. 84, Record on Appeal). Generally prescription does not run in favor
of a coheir as long as he expressly or impliedly recognizes the coownership (Art. 494,
Civil Code).1äwphï1.ñët But from the moment that a coheir claims absolute and
exclusive ownership of the hereditary properties and denies the others any share
therein, the question involved is no longer one of partition but that of ownership
(Bargayo vs. Camumot, 40 Phil. 857).
At the hearing of the petition for letters of administration some evidence was already
introduced on the assets constituting the estate of Gelacio Sebial. The petitioner
testified and presented Exhibits A to J and X to Y-3. The oppositor also testified and
presented Exhibits 2 to 10-A. The stenographic notes for the said hearing should be
transcribed. In addition to that evidence. The probate court should require the parties
to present further proofs on the ownership of the seven parcels of land and the
materials of the two houses enumerated in the amended inventory of November 17,
1961, on the alleged partition effected in 1945 and on the allegations in oppositors'
inventory dated November 7, 1961.
After receiving evidence, the probate court should decide once and for all whether
there are still any assets of the estate that can be partitioned and, if so, to effect the
requisite partition and distribution. If the estate has no more assets and if a partition
had really been made or the action to recover the lands transferred to third person
had prescribed, it should dismiss the intestate proceeding.
WHEREFORE, (a) the probate court's order of December 11, 1961, granting the
administratrix's motion of May 4, 1961 for the delivery to her of certain properties is
set aside; (b) its other order of December 11, 1961 approving the amended inventory
should not be considered as a final adjudication on the ownership of the properties
listed in the inventory and (c) this case is remanded to the lower court for further
proceedings in accordance with the guidelines laid down in this decision. No costs.

SO ORDERED.

Fernando (Chairman), Antonio and Concepcion, Jr., JJ., concur.

G.R. No. L-45430 April 15, 1939
In the matter of the estate of the deceased Paulina Vasquez Vda. de Garcia.
TERESA GARCIA, plaintiff-appellant,
vs.
LUISA GARCIA, MARIETA GARCIA, and PURIFICACION GARCIA, and BRAULIO DE VERA,
guardian of the minors Antonio, Lourdes and Ramon, surnamed De Vera, defendants-
appellees.
Anastasio R. Teodoro and Andres S. Nicolas for appellant.
Pablo Lorenzo, Delfin Joven and Eulalio Chaves for appellee.
VILLA-REAL, J.:
After Luisa Garcia was appointed special administratrix of the properties left by the
deceased Paulina Vasquez Vda. de Garcia, she filed with the competent court an
inventory thereof on May 13, 1936.
On May 23, 1936, the heir Teresa Garcia objected to said inventory, taking exception
to various items therein.
On June 20, 1936, the court issued the following order:
Without prejudice to the filing of an ordinary action by the heir Teresa Garcia
de Bartolome, the petition to include in the inventory certain properties of
the estate, filed by Teresa Garcia and others with the conformity of counsel
for the administratrix, is denied.
On July 28, 1936, Teresa Garcia filed a motion asking that she be appointed special
administratrix of the intestate for the sole purpose of bringing any action which she
may believe necessary to recover for the benefit of the intestate the properties and
credits set out in her motion, as well as other properties which might be discovered
from time to time belonging to the said intestate.
After hearing said motion and the administratrix' opposition thereto, the Court of First
Instance of Manila denied the motion by its order of August 19, 1936.
On motion for reconsideration filed by Teresa Garcia, which was opposed by the
administratrix, the court issued the following order of September 28, 1936:
This is a motion for reconsideration of the order of this Court of the 19th day
of August last, denying the petition of Teresa Garcia, one of the daughter of
the deceased, wherein she asked to be appointed special administratrix in
order that she might bring an action for the recovery of certain properties
which she claims belong to the estate and are in the possession of the regular
administratrix and her other sisters.
Before this petition was filed a hearing had been held to determine the
ownership of these properties as a direct result of Teresa Garcia's objection
to the inventory filed by the administratrix in which, it was alleged, those
properties should be included. Now the same party upon whose complaint
that hearing was conducted repudiates the steps taken by the court on the
ground on the grounds of alleged lack of jurisdiction.
The interrupted proceeding which the motion under consideration would
have set aside was by no means irregular. It is in accordance with the general
practice constantly followed in this jurisdiction. The jurisdiction to try
controversies between heirs of a deceased person regarding the ownership
of properties alleged to belong to his estate is vested in probate courts. In
the last analysis, the purpose of intestate proceeding is the distribution of
the decedent's estate among the persons entitled to succeed him. It is in the
nature of an action of partition, and in a suit of partition it is proper that each
party be required to bring into the mass whatever community property he or
she may have in his or her possession. To this end and as a necessary
corollary, the interested parties may introduce proofs relative to the
ownership of the properties in dispute. All the heirs who take part in the
distribution of the decedent's estate are before the court and subject to the
jurisdiction thereof in all matters and incidents necessary to the complete
settlement of such estate, so long as no interests of third parties are affected.
The cases relied upon by the movant have no bearing on the present case. In
the cases cited, not only were the persons alleged to have in their possession
properties of the estate strangers to the intestate, but their appearance had
been ordered under different provisions and for a different purpose. The
court was not aware of the fact that a proceeding under section 709 of the
Code of Civil Procedure is no t to try title to property.
However that may be, the jurisdiction involved here is one over the person,
not over the subject-matter; and it is a well-established rule that such
jurisdiction may be acquired by consent. A general appearance, let alone
going into trial without objection, has been always held to constitute a waiver
of the party's right to object to the authority of the court over his person. The
administratrix and other heirs have not objected.
 The motion for reconsideration is denied. The movant may however ask, if
she cares to do so, that this proceeding be reset for the continuation of the
hearing of her inventory of the administratrix and the determination of
whether the properties in question belong to the estate and should be
included in the said inventory for disposition according to law.
So ordered.
In the view of the foregoing, we are of the opinion and so hold, that a court takes
cognizance of testate on intestate proceedings has power and jurisdiction to
determine whether or not the properties included therein or excluded therefrom
belong prima facie to the deceased, although such a determination is not final or
ultimate in nature, and without prejudice to the right of the interested parties, in a
proper action, to raise the question bearing on the ownership or existence of the right
or credit.

From the foregoing order Teresa Garcia took this appeal, assigning our alleged errors Wherefore, the appealed order is affirmed, reserving to Teresa Garcia the right to ask
committed by the lower Court in its order, which errors boil down to the proposition for the reopening of the hearing of her opposition to the inventory, as well as to ask
of whether or not a court has jurisdiction to hear and pass upon the exceptions which for the appointment of a special administratrix in accordance with law, with the costs
an heir takes to an inventory of the properties left by a deceased referring to the to the appellant. So ordered.
inclusion or exclusion of certain properties and credits.
Avanceña, C.J., Imperial, Diaz, Laurel, Concepcion and Moran, JJ., concur.
It is the duty of every administrator, whether special or regular, imposed by section
668 of the Code of Civil Procedure, to return to the court within three months after
his appointment a true inventory of the real estate and all the goods, chattels, right,
and credits of the deceased which come into his possession or knowledge, unless he
is residuary legatee and has given the prescribed bond. The court which acquires
jurisdiction over the properties of a deceased person through the filing of the
corresponding proceedings, has supervision and control over the said properties, and
under the said power, it is its inherent duty to see that the inventory submitted by the
administrator appointed by it contains all the properties, rights and credits which the
law requires the administrator to set out in his inventory. In compliance with this duty
the court has also inherent power to determine what properties, rights and credits of
the deceased should be included in or excluded from the inventory. Should an heir or
person interested in the properties of a deceased persons duly call the court's
attention to the fact that certain properties, rights or credits have been left out in the
inventory, it is likewise the court's duty to hear the observations, with power to
determine if such observations should be attended to or not and if the properties
referred to therein belong prima facie to the intestate, but no such determination is
final and ultimate in nature as to the ownership of the said properties (23 C.J., p. 1163,
par. 381).

The lower court, therefore, had jurisdiction to hear the opposition of the heir Teresa
Garcia to the inventory filed by the special administratrix Luisa Garcia, as well as the
observations made by the former as to certain properties and credits, and to
determine for purposes of the inventory alone if they should be included therein or
excluded therefrom. As Teresa Garcia withdrew her opposition after evidence was
adduced tending to show whether or not certain properties belonged to the intestate
and, hence, whether they should be included in the inventory, alleging that the lower
court had no jurisdiction to do so, she cannot be heard to complain that the court
suspended the trial of her opposition.
G.R. No. L-51291 May 29, 1984 settlement of the estate, her alleged half sister and sole heir Rufina adjudicated to
herself all the property of the decedent including the property in question. After the
FRANCISCO CUIZON, ROSITA CUIZON, PURIFICATION C. GUIDO married to TEODORO notice of the extrajudicial settlement was duly published in a newspaper of general
GUIDO, and JUAN ARCHE, petitioners, circulation, Rufina thereafter, executed a deed of Confirmation of Sale wherein she
vs. confirmed and ratified the deed of sale of December 29, 1971 executed by the late
HON. JOSE R. RAMOLETE, Presiding Judge of the Court of First Instance of Cebu, Branch Irene and renounced and waived whatever rights, interest, and participation she may
III, DOMINGO L. ANTIGUA and SEGUNDO ZAMBO, respondents. have in the property in question in favor of the petitioners. The deed was duly
registered with the Registry of Deeds and annotated at the back of TCT No. 10477.
Eliseo C. Alinsug for petitioners. Subsequently, TCT No. 12665 was issued in favor of the petitioners.

Loreto M. Pono for respondents Domingo Antigua and Segundo Zambo. On September 28, 1978, a petition for letters of administrator was filed before the
Court of First Instance of Cebu (Sp. Proc. No. 3864-R) by respondent Domingo Antigua,
allegedly selected by the heirs of Irene numbering seventeen (17) in all to act as
administrator of the estate of the decedent. The petition was granted.
GUTIERREZ, JR., J.:
Respondent Antigua as administrator filed an inventory of the estate of Irene. He
included in the inventory the property in question which was being administered by
The sole issue in this petition for certiorari is whether or not a probate court has
Juan Arche, one of the petitioners. On June 27, 1979, respondent Antigua filed a
jurisdiction over parcels of land already covered by a Transfer Certificate of Title issued
motion asking the court for authority to sell the salt from the property and praying
in favor of owners who are not parties to the intestate proceedings if the said parcels
that petitioner Arche be ordered to deliver the salt to the administrator. The motion
have been included in the inventory of properties of the estate prepared by the
was granted and respondent court issued the following order:
administrator.
The administrator, thru this motion, informs the Court that the
For a clearer understanding of the present case, the background facts may be
estate owns some beds and fish pond located in Opao, Mandaue
appreciated. As far back as 1961, Marciano Cuizon applied for the registration of
City that these salt beds are producing salt which are now in the
several parcels of land located at Opao, Mandaue City then covered by certificates of
warehouse in Mandaue City, under the custody of Juan Arche that
Tax Declaration in Land Registration Case No. N-179. In 1970, he distributed his
the value of the salt in the warehouse is estimated to be worth
property between his two children, Rufina and Irene. Part of the property given to
P5,000.00 are beginning to melt and, unless they are sold as soon
Irene consisted largely of salt beds which eventually became the subject of this
as possible, they may depreciate in value. It is likewise prayed in this
controversy.
motion that Juan Arche be ordered to deliver the salt in question to
the administrator such other products of the land now in his (Juan
On December 29, 1971, Irene Cuizon executed a Deed of Sale with Reservation of Arche) possession.
Usufruct involving the said salt beds in favor of the petitioners Francisco, Rosita and
Purificacion, all surnamed Cuizon. At that time, Francisco and Rosita were minors and
xxx xxx xxx
assisted by their mother, Rufina, only sister of Irene. However, the sale was not
registered because the petitioners felt it was unnecessary due to the lifetime
Let this motion be, as it is hereby GRANTED. The administrator is
usufructuary rights of Irene.
hereby authorized to sell the salt now in the custody of Juan Arche
and the latter (Juan Arche) is hereby ordered to deliver the salt in
Although the decision in L.R. Case No. N-179 was rendered way back in 1962, the
question to the administrator in order to effect the sale thereof and
decree of registration No. N-161246 and the corresponding Original Certificate of Title
he is likewise directed to deliver such other products of the land to
No. 0171 was issued only in 1976 in the name of Marciano Cuizon. In that same year,
the administrator.
Transfer Certificate of Title No. 10477 covering the property in question was issued by
the Register of Deeds to Irene Cuizon. The latter died in 1978. In the extrajudicial
Subsequently, on three different occasions, respondent Segundo Zambo with the aid
of several men, sought to enforce the order of the respondent court, compelling the
petitioners to come to us on certiorari. On September 14, 1979, we issued a
restraining order enjoining the respondents from enforcing the above order of the
respondent court and from further interfering with the petitioners in their peaceful
possession and cultivation of the property in question.
The thrust of the petitioners' argument is that the respondent court, as a court
handling only the intestate proceedings, had neither the authority to adjudicate
controverted rights nor to divest them of their possession and ownership of the
property in question and hand over the same to the administrator. Petitioners further
contend that the proper remedy of the respondent administrator is to file a separate
civil action to recover the same.
On the other hand, the respondent administrator banked on the failure of the
petitioners to first apply for relief in the court of origin before filing the present
petition. According to him this was a fatal defect. In addition, the administrator stated
that the deed of sale of December 29, 1971 lost its efficacy upon the rendition of
judgment and issuance of the decree in favor of Irene Cuizon.
It is a well-settled rule that a probate court or one in charge of proceedings whether
testate or intestate cannot adjudicate or determine title to properties claimed to be a
part of the estate and which are equally (claimed to belong to outside parties. All that
the said court could do as regards said properties is to determine whether they should
or should not be included in the inventory or list of properties to be administered by
the administrator. If there is no dispute, well and good; but if there is, then the parties,
the administrator, and the opposing parties have to resort to an ordinary action for a
final determination of the conflicting claims of title because the probate court cannot
do so (Mallari v. Mallari, 92 Phil. 694; Baquial v. Amihan, 92 Phil. 501).
Similarly, in Valero Vda. de Rodriguez vs. CA., (91 SCRA 540) we held that for the
purpose of determining whether a certain property should or should not be included
in the inventory the probate court may pass upon the title thereto but such
determination is not conclusive and is subject to the final decision in a separate a
petition regarding ownership which may be instituted by the parties (3 Moran's
Comments on the Rules of Court, 1970 Edition, pages 448-9 and 473: Lachenal v. Salas,
L-42257, June 14, 1976, 71 SCRA 262, 266).
In the instant case, the property involved is not only claimed by outside parties but it,
was sold seven years before the death of the decedent and is duly titled in the name
of the vendees who are not party to the proceedings. In Bolisay vs. Alcid, (85 SCRA
213), this Court was confronted with a similar situation. The petitioners therein sought
to annul the order of the respondent court in a special proceeding which in effect
ruled that notwithstanding that the subject property was duly titled in the name of
petitioners, the administratrix of the intestate estate involved in said proceeding had
the right to collect the rentals of said property over the objection of the titled owners
just because it was included in the inventory of said estate and there was an ordinary
action in the regular court over the ownership thereof and the estate was one of the
parties therein. This Court viewed the petition as one seeking for a prima facie
determination and not a final resolution of the claim of ownership.
We held that:
... Considering that as aforestated the said property is titled under
the Torrens System in the names of the petitioners, it does appear
strange, in the light of the probate court's own ruling that it has no
jurisdiction to pass on the issue of ownership, that the same court
deemed the same as part of the estate under administration just
because the administratrix, alleges it is still owned by the estate and
has in fact listed it in the inventory submitted by her to the court.
It does not matter that respondent - administratrix has evidence
purporting to support her claim of ownership, for, on the other
hand, petitioners have a Torrens title in their favor, which under the
law is endowed with incontestability until after it has been set aside
in the manner indicated in the law itself, which, of course, does not
include, bringing up the matter as a mere incident in special
proceedings for the settlement of the estate of deceased persons.
In other words, in Our considered view, the mere inclusion in the
inventory submitted by the administrator of the estate of a
deceased person of a given property does not of itself deprive the
probate court of authority to inquire into the property of such
inclusion in case an heir or a third party claims adverse title thereto.
To hold otherwise would render inutile the power of that court to
make a prima facie determination of the issue of ownership
recognized in the above quoted precedents. The correct rule is that
the probate court should resolve the issue before it provisionally, as
basis for its inclusion in or exclusion from the inventory. It does not
even matter that the issue is raised after approval of the inventory
because "apparently, it is not necessary that the inventory and
appraisal be approved by the Court." (Francisco on the Rules of
Court Vol. V-B, p. 99, citing Siy Chong Keng vs. Collector of Internal
Revenue, 60 Phil. 494)
In regard to such incident of inclusion or exclusion, We hold that if
a property covered by Torrens Title is involved, the presumptive
 conclusiveness of such title should be given due weight, and in the
absence of strong compelling evidence to the contrary, the holder
thereof should be considered as the owner of the property in
controversy until his title is nullified or modified in an appropriate
ordinary action, particularly, when as in the case at bar, possession
of the property itself is in the persons named in the title.

Having been apprised of the fact that the property in question was in the possession
of third parties and more important, covered by a transfer certificate of title issued in
the name of such third parties, the respondent court should have denied the motion
of the respondent administrator and excluded the property in question from the
inventory of the property of the estate. It had no authority to deprive such third
persons of their possession and ownership of the property. Respondent court was
clearly without jurisdiction to issue the order of June 27, 1979. Thus, it was
unnecessary for the petitioners to first apply for relief with the intestate court.

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

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

SO ORDERED.

Teehankee, (Chairman), Melencio-Herrera, Plana, Relova and De la Fuente, JJ., concur.

G.R. No. L-23035 October 13, 1925 judge further found that after the death of the first wife the testator had liquidated
the ganacial estate pertaining to them and had divided among the first set of children
In re will of Ignacio Abuton y Poncol, deceased. all of the property that pertained to the first wife in the division, with the exception of
TEODORA GUINGUING, petitioner-appellee, the home-place in the poblacion, in which the testator had continued to reside till
vs. death. The share pertaining to the testator in said division was, so the court found,
AGAPITO ABUTON and CALIXTO ABUTON, opponents-appellants. retained in his own hands; and this property constituted the proper subject matter of
the present administration proceedings. Accordingly an order was entered to the
M. Abejuela for appellants. effect that the administrator should include in the inventory of the estate of Agapito
No appearance for appellee. Abuton all of the property of which the testator was possessed at the time of his death.
From this order the two opponents of the motion appealed.

We entertain serious doubts as to whether the order in question here was really such
a final order as to be appealable under section 783 of the Code of Civil Procedure,
STREET, J.:
since the making of the inventory is necessarily of a preliminary and provisional
nature, and the improper inclusion of property therein or the improper omission of
In the course of the administration of the estate of Ignacio Abuton, deceased, resident
property therefrom is not absolutely decisive of the rights of persons in interest. But,
of Oroquieta, Province of Misamis, it appeared that the deceased died testate on
passing this point without decision, we proceed to consider whether there is any merit
March 8, 1916, leaving two sets of children by two different wives, the first of whom
in the errors assigned to the order which is the subject of the appeal. 1awph!l.net
was Dionisia Olarte, who died about twenty years ago, and by whom the deceased
had twelve, children, three of whom died without issue. The second wife was Teodora
The contention made in the first assignment of error, to the effect that an order of the
Guinguing, to whom the testator was married on July 14, 1906, and by whom he had
character of that appealed from cannot be made by a court without formal notice
four children, all still living. A will of the testator, executed on November 25, 1914, was
being given to all persons in interest, in the same manner as if a new action had been
probated in court and allowed on October 9, 1917 (Exhibit A); and one Gabriel Binaoro
begun, is clearly untenable, since all the heirs are already virtually represented in the
was appointed administrator. In due course of proceeding Binaoro submitted to the
administration and are bound by all proper orders made therein, so far and so far only
court an inventory of the properties belonging to the deceased at the time of his
as such orders have legal effect. This is not inconsistent with the proposition that
death. In this inventory he included only the lands which the testator had devised to
contested claims of ownership between the administrator and third persons should
the children of the second marriage, omitting other lands possessed by him at the
be tried in separate proceedings, which is entirely true. The question here is merely
time of his death and which were claimed by the children of the first marriage as
between some of the heirs and the administrator, as representative of all persons in
having been derived from their mother. Accordingly, on March 14, 1922, Teodoro
interest. Besides, it should be pointed out, the inclusion of a property in the inventory
Guinguing, in representation of herself and her four minor children, presented a
does not deprive the occupant of possession; and if it is finally determined that the
motion in court, asking that the administrator be required to amend his inventory and
property has been properly included in the estate, the occupant heir is liable for the
to include therein all property pertaining to the conjugal partnership of Ignacio Abuton
fruits and interest only from the date when the succession was opened (art. 1049, Civ.
and Dionisia Olarte, including property actually in the hands of his children by her
Code). The provisions of the Civil Code with reference to collation clearly contemplate
which (the motion alleged) had been delivered to said children as an advancement.
that disputes between heirs with respect to the obligation to collate may be
The purpose of the motion was to force the first set of children to bring into collation
determined in the course of the administration proceedings.
the properties that had been received by them, in conformity with article 1035 of the
Civil Code; and the motion was based partly on the supposition that Ignacio Abuton
had never in fact effected a liquidation of the conjugal property pertaining to himself The second and third assignments are directed to the supposed errors of the court in
and Dionisia Olarte. This motion was formally opposed by two of the children of the having based its findings as to the property belonging to the estate of Agapito Abuton
first marriage, namely, Agapito and Calixto Abuton y Olarte. in part upon the recitals of his legalized will (Exhibit A) and in part upon the recitals of
a previous will (Exhibit 1), which had been superseded by the last. This older will
appears to have been produced by the representatives of the first set of children in
Upon hearing the proof the trial judge found that no property had been acquired by
the proceedings for the probate of the will which was admitted, and was attached to
the testator during his second marriage and that the administration was concerned
only with property that had been acquired before the death of the first wife. The trial
that expediente. It is said in appellants' brief that this document was not introduced in
evidence at the hearing of the present controversy.

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

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

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

Avanceña, C. J., Malcolm, Villamor, Ostrand, Johns, and Villa-Real, JJ., concur.
G.R. No. L-31860 October 16, 1930 (c) The court erred in admitting, over objection, Exhibits D, E and F.

In the matter of the Estate of Charles C. Rear, deceased. J.J. WILSON, administrator- (d) That Wilson, as special administrator and as administrator, was
appellee, neglectful and imprudent and he committed waste. He is, therefore,
vs. liable.
M. T. REAR, ET AL., heirs-appellants.
II. The lower court erred in refusing to allow the cross-examination and direct
J. A. Wolfson and Lionel D. Hargis for appellants. examination of witnesses.
Juan S. Alano and Pastor Kimpo for appellee.
III. The lower court erred in denying the request for a reasonable continuance
STATEMENT in order to obtain depositions.

July 14, 1925, Charles C. Rear was murdered by some Moros on his plantation situate Separate Opinions
in the interior of the Province of Cotabato at an isolated place, without communication
except by river, about 17 kilometers from the nearest settlement of Pikit, and about JOHNS, J.:
70 kilometers from the town of Cotabato. The whole plantation consisted of public
lands. J.J. Wilson qualified as special administrator of the estate on November It appears from the first inventory of December 27, 1925, that the assets of the estate,
17,1925. Later, the property of the estate was appraised at P20,800, of which the including real property, coconut trees, and houses were P15,300, and that the
commissioners filed an inventory and report, which was also signed by Wilson. January personal property was valued at P5,250, which included 80 head of cattle, carabao
4,1927, the commisioners made and filed a report of claims against the estate, but by and horses of the value of P4,000. Although he was appointed special administrator
reasons of the fact that it was claimed and alleged that the administrator did not have on November 17, 1925, he never made any report or filed any account of any kind
any funds to pay, on March 30, 1927, the court ordered the administrator to sell a until 1927. Neither did he apply to or obtain an order from the court of any nature
portion of the property. April 26, 1927, and with the consent of the heirs, a petition during that period, and it appears that the attention of the court was for the first time
was made for authority to sell, under sealed proposal, all the property of the estate, called to the administration of the estate when the commissioners on claims asked to
with a view of closing the administration. October 10,1927, the court granted this have their fees paid; otherwise, the court never made any order of any kind from
petition, and after due notice, the public sale took place, and the property was sold to December 27, 1925, to April, 1927. It also appears that at the time of his death, the
Wm. Mannion for P7,600. April 26,1927, Wilson submitted a report covering his only debts against the deceased were one in favor of Sewal Fleming which then
administration to that date, which was approved and later set aside on motion of the amounted to P800, and one in favor of J. S. Alano for P500. It appears from the
heirs of the deceased. March 23, 1928, Wilson filed his final account which later was amended final report that in the course of administration, the administrator received
amended on June 20,1928, to which the heirs made numerous and specific objections, the following amounts from the specified sources:
and after a hearing, the court approved the account as filed. From which the heirs of
the deceased appealed and assign the following errors:
1925
I. The lower court erred in approving the final amended account of the
Nov. 30, Hogs sold (see plant. book) P108.50
administrator for the following reasons:
Sales store (see plant. book) 38.02
(a) That the alleged disbursements made by the special
administrator and the administrator were far in excess of the Dec. 31, Sundry products sold (see plant. book) 217.50
amount required to preserve the estate;
Old debt collected 6.00
(b) That no authority being asked for or granted by the court, all
1926
loans or advances, made to the estate, were made contrary to law
and are not legal charges against the estate (Trs., p. 37).
Jan. 31, Sundry farm products 76.15 July Carabao sold 100.00

Sales store 104.58 Two steers sold 160.00

Feb. 28, Sundry products 130.00 Aug. Hogs sold 79.50

Sales store 87.95 Few nuts sold 8.00

March 31, Sundry products 3.00 Sept. Two steers sold 180.00

Sales store 53.12 Nuts sold 12.00

April 30, Products 117.00 Oct. $50 U. S. Liberty Bond & Interest 127.52

Store .25
The total of which is 1,919.25
May None (Store discontinued)

June 30, Products 2.20

From which it appears that on November 30,1925, the administrator sold hogs for
July Do 29.75 P108.50; in July, 1927, he sold one carabao for P100 and two steers for P160; in August
he sold hogs for P79.50; and in September he sold two steers for P180.
Aug. Do 12.80

Sept. Do 18.40 Strange as it may seem, the above is the only account which was ever rendered of the
livestock which was appraised at P4,000, and yet no specific objection was ever made
Oct. None. or filed to the final account of the administrator for his failure to render any other or
different account of the livestock. Even so, it appears that the sale to Mannion was
Nov. Do. made by and with the consent of the heirs, and that the deed was intended to convey
all of the property to him described in the inventory, except that of a perishable nature
Dec. Do. and some personal effects. It further appears from the amended account that the total
amount of cash received by the administrator, including the sale to Mannion was
1927 P9,519.25, and that the total amount of cash disbursed by the administrator was
P11,328.94, leaving a deficit or balance due and owing from the estate of P1,809.69.
Jan. Products 16.00
It also appears that the amount of Fleming's note at the time it was paid was
Feb. Do 166.60 P1,003.40, and that the taxes for the years 1925,1926, and 1927 amounted to
P152.14, and the claim of J. S. Alano amounted to P500. That is to say, at the time they
Mar. Products 15.00 were paid, the actual claims against the deceased was P 1,655.54. Here, it will be noted
that the value of the personal property of the estate at the time of Wilson's
Cash received from Constabulary 20.91 appointment, appearing over his own signature was P5,800 which included 80 head
of cattle, carabao and horses of the value of P4,000. That is to say, at the time Wilson
Apr. Products 13.50 was appointed, his estate had personal property of the value of P5,800, and when the
amended final account was filed the actual debts of the deceased, including interest
May Do 5.00
and accumulated taxes, was P1,655.54.
June Do 10.00
In this situation, it was the legal duty of the administrator to at once apply to the court
for an order to sell the personal property to pay the debts of the deceased and the
expenses of administration. It also appears from the amended final account that the
expenses charged by the administrator was P750.94; that the court expenses,
including attorney's fees was P693.20; and that the claims of the commisioners was
P322.90, the total of which is P1,767.04. That is to say, that the total of all claims
against the deceased, including interest and taxes was P1,655.54, and that the whole
amount of the court costs and expenses of administration was P1,767.04, the total of
which is P3,422.58. That is to say, at the time of his appointment, it appears over the
administrator's own signature that the value of the personal property of the deceased
which came into his possession was P5,800, and the whole amount of claims against
Rear at the time of his death and the court costs and expenses of administration was
P3,422.58. That is to say, if the personal property of the estate had been promptly
sold, when it should have been, and sold for its appraised value, all the debts of the
deceased and the court costs and expenses of administration would have been paid,
and the estate would have a balance left of P2,377.42. Instead of doing that, and
without any order, process or authority of the court the administrator, as appears
from his amended final account, continued the operation of the plantation and the
employment of Fleming as manager at a salary of P200 per month, and a large number
of men, so that at the time of the filing of the amended final account, the total expense
for labor was P2,863.62, and the amount of the manager's salary was P4,533.33, the
net result of which was that all of the property of the estate was consumed, lost, or
destroyed, leaving a deficit against the estate of P1,809.69. Whereas, if the
administrator had followed the law and promptly sold the personal property, all of the
debts of the estate would have been paid, and it would have a cash balance in its favor
of P2,377.42, and all of its real property left, which was appraised at P15,000.
It is but fair to say that Wilson's place of business, which was in Zamboanga, is at least
300 kilometers from the plantation, and that he declined to serve as administrator and
only accepted it under pressure. That in legal effect he operated and left the
management of the plantation largely in the discretion of Fleming, and that he
personally had but little, if anything, to do with the administration, and it does not
appear that he was a party to any fraud. But even so, he was appointed and qualified
as administrator, and the law imposed upon him legal duties and obligations, among
which was to handle the estate in a business-like manner, marshal its assets, and close
the estate without any unreasonable or unnecessary delay. He was not appointed to
act for or on behalf of the creditors, or to represent the interests of the heirs only. He
should have administered the affairs of the estate for the use and benefit alike of all
interested persons, as any prudent business man would handle his own personal
business. When appointed, it is the legal duty of the administrator to administer,
settle, and close the administration in the ordinary course of business, without any
unnecessary delay. Neither does an administrator, in particular, without a specific
showing or an order of the court, have any legal right to continue the operation of the
business in which the deceased was engaged, or to eat up and absorb the assets of
the estate in the payment of operating expenses. Yet, in the instant case, the
administrator on his own volition and without any authority or process of court
continued the operation of the plantation, and in the end, as shown by his own report,
the estate, which was appraised at P20,800, with actual debts of the deceased of only
P1,655,54 was all wiped out and lost, and left with a deficit of P1,809.69. 1awph!l.net
The law does not impose upon an administrator a high degree of care in the
administration of an estate, but it does impose upon him ordinary and usual care, for
want of which he is personally liable. In the instant case there were no complications
of any kind and in the usual and ordinary course of business, the administrator should
have wound up and settled the estate within eight months from the date of his
appointment.
Ruling Case Law, vol. 11, section 142, says:
Winding up Business — An executor or administrator ordinarily has no power
to continue the business in which the decedent was engaged at the time of
his death; and this is true although he acts in the utmost good faith and
believes that he is proceeding for the best interests of the estate. The penalty
for continuing a business of the decedent without authority is the imposition
of a personal liability on the executor or administrator so doing for all debts
of the business. The normal duty of the personal representative in reference
to such business is limited to winding it up, and even where the beneficiaries
are infants the court cannot authorize the administrator to carry on the trade
of the decedent. However, an exception to the general rule is sometimes
recognized; and so it has been held that in order to settle an estate the
personal representative may, in some cases , be permitted to continue a
business for a reasonable time. For example, such personal representative
when authorized to postpone the sale of the testator's effects may generally
carry on the business for a reasonable time with a view to its sale as a going
concern. Even in such cases the personal representatives are not, however,
entitled to embark in the business more of the testator's property than was
employed in it at his death. (Citing numerous authorities.)
The same principle is also laid down in Cyc., vol., 18,p. 241, where it is said:
C. Engaging in Business — 1. GENERAL RULE. The general rule is that neither
an executor nor an administrator is justified in placing or leaving assets in
trade, for this is a hazardous use to permit of trust moneys; and trading lies
outside the scope of administrative functions. So great a breach of trust is it
for the representative to engage in business with the funds of the estate that
the law charges him with all the losses thereby incurred without on the other
hand allowing him to receive the benefit of any profits that he may make, the
 rule being that the persons beneficially interested in the estate may either appears from the record that during his lifetime, the deceased employed a number of
hold the representative liable for the amount so used with interest, or at their laborers on the plantation, and that after Wilson was appointed as administrator,
election take all the profits which the representative has made by such Fleming personally took charge of and operated the plantation, and that the expenses
unauthorized use of the funds of the estate. of which for the first eight months was P2,257.45.

Even so, considering the fact that Wilson's home and place of
business was 300 kilometers from the plantation, and that in the
very nature of things, he could not give the business of the estate
his personal attention, we are disposed to be more or less lenient,
and to allow him the actual operating expenses of the plantation for
the first eight months of his appointment amounting to P2,257.45.
Although the expense account of the administrator and the claims
of the commissioners are somewhat high, we are also disposed to
allow those claims. That is to say, in his final account, the
administrator should have credit for the following items:
The order of the lower court approving the final account of Wilson as administrator is
reversed and set aside, and a judgment will be entered in favor of the heirs and against
the administrator for P3,839.22, with interest thereon from November 7,1927, at the
rate of 6 per cent per annum, without prejudice to any remedy which the heirs may
have against the bondsmen of the administrator. The appellants to recover costs. So
ordered.
Avanceña, C.J., Johnson, Street, Malcolm, Villamor, Romualdez and Villa-Real, JJ.,
concur.
Ostrand, J., reserves his vote.

His personal charges and expenses P 750.94

Court expenses, including attorney's fee 693.20

Claims of the commissioners 322.90

Expenses for and on account of operation for the first eight months 2,257.45

Debts against the deceased, including taxes 1,655.54

or a total of 5,680.03

As stated, it appears from his report that the administrator in the course of
administration received P1,919.25 from the sale of personal property. This with the
P7,600 which he received from the remaining assets sold to Mannion make a total of
P9,519.25 from which should be deducted P5,680.03 for and on account of the items
above stated, leaving a balance due and owing from the administrator to the heirs of
the deceased of P3,839.22.

As stated, it is the duty of the administrator of an estate to represent and protect the
interests of all interested persons, including the heirs of the deceased. It is very
apparent upon their face that the entries in Exhibits D and E were not made in the
ordinary course of business, and even if they were, they would not be evidence of the
payments without the corresponding receipts or vouchers. That is to say, to entitle
the administrator to credit for money paid out in the course of administration, he
should submit and file with the court a corresponding receipt or voucher. Even so, it
G.R. No. L-19265 May 29, 1964
MOISES SAN DIEGO, SR., petitioner,
vs.
ADELO NOMBRE and PEDRO ESCANLAR, respondents.
A. R. Castañeda and M. S. Roxas for petitioner.
Amado B. Parreño Law Office for respondents.
PAREDES, J.:
The case at bar had its origin in Special Proceedings No. 7279 of the CFI of Negros
Occidental wherein respondent Adelo Nombre was the duly constituted judicial
administrator. On May 1, 1960, Nombre, in his capacity was judicial administrator of
the intestate estate subject of the Sp. Proc. stated above, leased one of the properties
of the estate (a fishpond identified as Lot No. 1617 of the cadastral survey of
Kabankaban, Negros Occidental), to Pedro Escanlar, the other respondent. The terms
of the lease was for three (3) years, with a yearly rental of P3,000.00 to expire on May
1, 1963, the transaction having been done, admittedly, without previous authority or
approval of the Court where the proceedings was pending. On January 17, 1961,
Nombre was removed as administrator by Order of the court and one Sofronio
Campillanos was appointed in his stead. The appeal on the Order of Nombre's removal
is supposedly pending with the Court of Appeals. Respondent Escanlar was cited for
contempt, allegedly for his refusal to surrender the fishpond to the newly appointed
administrator. On March 20, 1961, Campillanos filed a motion asking for authority to
execute a lease contract of the same fishpond, in favor of petitioner herein, Moises
San Diego, Sr., for 5 years from 1961, at a yearly rental of P5,000.00. Escanlar was not
notified of such motion. Nombre, the deposed administrator, presented a written
opposition to the motion of Campillanos on April 11, 1964, pointing out that the
fishpond had been leased by him to Escanlar for 3 years, the period of which was going
to expire on May 1, 1963. In a supplemental opposition, he also invited the attention
of the Court that to grant the motion of the new administrator would in effect nullify
the contract in favor of Escanlar, a person on whom the Court had no jurisdiction. He
also intimated that the validity of the lease contract entered into by a judicial
administrator, must be recognized unless so declared void in a separate action. The
opposition notwithstanding, the Court on April 8, 1961, in effect declared that the
contract in favor of Escanlar was null and void, for want of judicial authority and that
unless he would offer the same as or better conditions than the prospective lessee,
San Diego, there was no good reason why the motion for authority to lease the
property to San Diego should not be granted. Nombre moved to reconsider the Order
of April 8, stating that Escanlar was willing to increase the rental of P5,000.00, but only
after the termination of his original contract. The motion for reconsideration was
denied on April 24, 1961, the trial judge stating that the contract in favor of Escanlar
was executed in bad faith and was fraudulent because of the imminence of Nombre's
removal as administrator, one of the causes of which was his indiscriminate pleasant,
of the property with inadequate rentals.
From this Order, a petition for Certiorari asking for the annulment of the Orders of
April 8 and 24, 1961 was presented by Nombre and Escanlar with the Court of Appeals.
A Writ of preliminary injunction was likewise prayed for to restrain the new
administrator Campillanos from possessing the fishpond and from executing a new
lease contract covering it; requiring him to return the possession thereof to Escanlar,
plus damages and attorney's fees in the amount of P10,000.00 and costs. The Court
of Appeals issued the injunctive writ and required respondents therein to Answer.
Campillanos insisted on the invalidity of the contract in favor of Escanlar; the lower
court alleged that it did not exactly annul or invalidate the lease in his questioned
orders but suggested merely that Escanlar "may file a separate ordinary action in the
Court of general jurisdiction."
The Court of Appeals, in dismissing the petition for certiorari, among others said —
The controlling issue in this case is the legality of the contract of lease entered
into by the former administrator Nombre, and Pedro Escanlar on May 1,
1960.
Respondents contend that this contract, not having been authorized or
approved by the Court, is null and void and cannot be an obstacle to the
execution of another of lease by the new administrator, Campillanos. This
contention is without merit. ... . It has been held that even in the absence of
such special powers, a contract or lease for more than 6 years is not entirely
invalid; it is invalid only in so far as it exceeds the six-year limit (Enrique v.
Watson Company, et al., 6 Phil. 84). 1
No such limitation on the power of a judicial administrator to grant a lease of
property placed under his custody is provided for in the present law. Under
Article 1647 of the present Civil Code, it is only when the lease is to be
recorded in the Registry of Property that it cannot be instituted without
special authority. Thus, regardless of the period of lease, there is no need of
special authority unless the contract is to be recorded in the Registry of
Property. As to whether the contract in favor of Escanlar is to be so recorded
is not material to our inquiry. 1äwphï1.ñët
On the contrary, Rule 85, Section 3, of the Rules of Court authorizes a judicial
administrator, among other things, to administer the estate of the deceased
not disposed of by will. Commenting on this Section in the light of several
Supreme Court decisions (Jocson de Hilado v. Nava, 69 Phil. 1; Gamboa v.
 Gamboa, 68 Phil. 304; Ferraris v. Rodas, 65 Phil. 732; Rodriguez v. Borromeo,
43 Phil. 479), Moran says: "Under this provision, the executor or
administrator has the power of administering the estate of the deceased for
purposes of liquidation and distribution. He may, therefore, exercise all acts
of administration without special authority of the Court. For instance, he may
lease the property without securing previously any permission from the
court. And where the lease has formally been entered into, the court cannot,
in the same proceeding, annul the same, to the prejudice of the lessee, over
whose person it had no jurisdiction. The proper remedy would be a separate
action by the administrator or the heirs to annul the lease. ... .
On September 13, 1961, petitioner herein Moises San Diego, Sr., who was not a party
in the case, intervened and moved for a reconsideration of the above judgment. The
original parties (the new administrator and respondent judge) also filed Motions for
reconsideration, but we do not find them in the record. On November 18, 1961, the
Court of Appeals denied the motions for reconsideration. With the denial of the said
motions, only San Diego, appealed therefrom, raising legal questions, which center on
"Whether a judicial administrator can validly lease property of the estate without prior
judicial authority and approval", and "whether the provisions of the New Civil Code on
Agency should apply to judicial administrators."
The Rules of Court provide that —
An executor or administrator shall have the right to the possession of the real
as well as the personal estate of the deceased so long as it is necessary for
the payment of the debts and the expenses of administration, and shall
administer the estate of the deceased not disposed of by his will. (Sec. 3, Rule
85, old Rules).
Lease has been considered an act of administration (Jocson v. Nava; Gamboa v.
Gamboa; Rodriguez v. Borromeo; Ferraris v. Rodas, supra).
The Civil Code, on lease, provides:
If a lease is to be recorded in the Registry of Property, the following persons
cannot constitute the same without proper authority, the husband with
respect to the wife's paraphernal real estate, the father or guardian as to the
property of the minor or ward, and the manager without special power. (Art.
1647).
The same Code, on Agency, states:
Special powers of attorneys are necessary in the following cases:
(8) To lease any real property to another person for more than one year. (Art.
1878)
Petitioner contends, that No. 8, Art. 1878 is the limitation to the right of a judicial
administrator to lease real property without prior court authority and approval, if it
exceeds one year. The lease contract in favor of Escanlar being for 3 years and without
such court approval and authority is, therefore, null and void. Upon the other hand,
respondents maintain that there is no limitation of such right; and that Article 1878
does not apply in the instant case.
We believe that the Court of Appeals was correct in sustaining the validity of the
contract of lease in favor of Escanlar, notwithstanding the lack of prior authority and
approval. The law and prevailing jurisprudence on the matter militates in favor of this
view. While it may be admitted that the duties of a judicial administrator and an agent
(petitioner alleges that both act in representative capacity), are in some respects,
identical, the provisions on agency (Art. 1878, C.C.), should not apply to a judicial
administrator. A judicial administrator is appointed by the Court. He is not only the
representative of said Court, but also the heirs and creditors of the estate (Chua Tan
v. Del Rosario, 57 Phil. 411). A judicial administrator before entering into his duties, is
required to file a bond. These circumstances are not true in case of agency. The agent
is only answerable to his principal. The protection which the law gives the principal, in
limiting the powers and rights of an agent, stems from the fact that control by the
principal can only be thru agreements, whereas the acts of a judicial administrator are
subject to specific provisions of law and orders of the appointing court. The
observation of former Chief Justice Moran, as quoted in the decision of the Court of
Appeals, is indeed sound, and We are not prone to alter the same, at the moment.
We, likewise, seriously doubt petitioner's legal standing to pursue this appeal. And, if
We consider the fact that after the expiration of the original period of the lease
contract executed by respondent Nombre in favor of Escanlar, a new contract in favor
of said Escanlar, was executed on May 1, 1963, by the new administrator Campillanos.
who, incidentally, did not take any active participation in the present appeal, the right
of petitioner to the fishpond becomes a moot and academic issue, which We need not
pass upon.
WHEREFORE, the decision appealed from should be, as it is hereby affirmed, in all
respects, with costs against petitioner Moises San Diego, Sr.
Bengzon, C.J., Bautista Angelo, Concepcion, Reyes, J.B.L., Barrera, Regala and
Makalintal, JJ., concur.
Padilla, Labrador and Dizon, JJ., took no part.
G.R. No. L-28214 July 30, 1969 t. Cash on Bank: BPI (Savings) D-1365 in the amount of P55,284.11; PNB
(Savings) 8189, in the amount of P9,047.74; and PCIB (Savings) 337, in the
NATIVIDAD V. A. JARODA, petitioner, amount of P416.24. (Annex "A" to Petition, Rollo, pages 1415);
vs.
THE HONORABLE VICENTE N. CUSI, JR., Presiding Judge, Branch I, Court of First Instance that the heirs of the deceased are his surviving spouse, nine (9) children (among them
of Davao, and ANTONIO V. A. TAN, in his capacity as judicial administrator of intestate the herein petitioner, Natividad V. A. Jaroda), and four (4) grandsons, among them the
estate of Carlos Villa Abrille, Special Proc. No. 1391, Court of First Instance of Davao, herein respondent, Antonio V. A. Tan.
respondents.
On 26 April 1965, respondent Tan was appointed special administrator.
Dario C. Rama for petitioner.
Jose R. Madrazo, Jr. for respondents. On 4 May 1965, respondent special administrator Tan fled an ex-parte petition for the
withdrawal of the sums of P109,886.42 and P72,644.66 from the Philippine National
REYES, J.B.L., J.: Bank, Davao Branch, which sums were not listed in his petition for administration as
among the properties left by the deceased, alleging that these sums were deposited
Questioned as null and void in this petition for certiorari with preliminary injunction in the name of the deceased but that they actually belong to, and were held in trust
are two (2) orders of the Court of First Instance of Davao, Branch I, issued in its Special for, the co-owners of the Juna Subdivision, and alleging as reason for the withdrawal
Proceeding No. 1391 entitled "In the Matter of the Intestate Estate of Carlos Villa that it would be advantageous to the estate of the deceased. Annexed to the said
Abrille, deceased, Antonio V. A. Tan, petitioner." petition are powers of attorney purportedly signed by the co-owners in 1948 and 1949
authorizing the late Carlos Villa Abrille to sell the lots in the Juna Subdivision and to
The first of the said two orders, dated 5 May 1965, granted an ex-parte petition by deposit the proceeds thereof with the Philippine National Bank. The alleged co-owners
then special administrator Antonio V. A. Tan, the herein respondent, to withdraw from of the subdivision concurred in the petition, but not the heirs of the deceased (Annex
the Philippine National Bank the amount of P182,531.08 deposited in savings and "C" to Petition, Rollo, page 19).
checking accounts in the name, and during the lifetime, of Carlos Villa Abrille (now
deceased) but allegedly held in trust for the decedent's co-owners in the Juna The respondent court found the petition for withdrawal of the bank deposits as
Subdivision. "meritorious", and granted the petition in an order on 5 May 1965.

The second order, dated 3 September 1965, approved ex-parte the power of attorney
executed by special administrator Tan appointing himself attorney-in-fact to sell the
share of the estate in the subdivision lots.
The aforesaid Special Proceeding No. 1391 was commenced by Antonio V. A. Tan on
22 April 1965, alleging in his petition filed with the respondent court that Carlos Villa
Abrille died intestate on 3 April 1965; that he left an estate consisting of his conjugal
share in real and personal properties, among which are:
p. Nineteen (19) Percent share in the co-ownership known as Juna
Subdivision;
xxx xxx xxx
xxx xxx xxx
On 7 May 1965, special administrator Tan executed, together with the other co-
owners of the Juna Subdivision, a power of attorney appointing himself as attorney-
in-fact to "sell (or) dispose upon terms and conditions as he deems wise" the lots in
the 99.546-hectare subdivision (Annex "F-1" to Petition, Rollo, pages 30-32).
On 9 September 1965, respondent Tan was issued letters of administration by the
respondent court.
On the same day, 9 September 1965, as regular administrator, respondent Tan filed a
petition with the respondent court, alleging that the deceased was the manager of
and a co-owner in the Juna Subdivision and that he had been engaged in the business
of selling the lots, and praying for the approval by the court of the power of attorney
executed by him, in behalf of the intestate estate, and appointing and authorizing
himself to sell the lots.
The court granted the petition, "as prayed for," on 3 September 1965.1äwphï1.ñët
On 29 November 1966, herein petitioner Natividad V. A. Jaroda moved to nullify the
order of 5 May 1965, that allowed the withdrawal of the bank deposits, as well as the
order of 3 September 1965, which approved the power of attorney.
The respondent court denied, on 25 February 1967, "for lack of merit" the aforesaid
motion.
Petitioner Jaroda appealed from the order of denial, but the respondent court
dismissed the appeal on the ground that the order appealed from was interlocutory.
Jaroda then filed before the Supreme Court a petition for certiorari and/or mandamus
on 8 July 1967, docketed as G.R. No. L-27831, but this Court dismissed the petition,
adding in its resolution that appeal in due time is the remedy.
On 28 October 1967, petitioner Jaroda filed the present petition for certiorari with
preliminary injunction. She alleged, among other things, that appeal would not be
speedy and adequate as respondent Tan has sold and continues to sell the subdivision
lots on the strength of the respondent court's order, to her irreparable prejudice and
that of the other heirs. This Court gave due course to the petition and issued
preliminary injunction on 3 November 1967, restraining the respondent from selling
the share of the intestate estate.
We agree with petitioner that the order of 5 May 1965 allowing the special
administrator to withdraw the bank deposits standing in the name of the decedent is
in abuse of discretion amounting to lack of jurisdiction. In the first place, said
withdrawal is foreign to the powers and duties of a special administrator, which, as
Section 2 of Rule 80 of the Rules of Court provides, are to —
take possession and charge of the goods, chattels, rights, credits and estate
of the decease and preserve the same for the executor or administrator
afterwards appointed, and for that purpose may commence and maintain
suits as administrator. He may sell only such perishable and other property
as the court orders sold. A special administrator shall not be liable to pay any
debts of the deceased unless so ordered by the court.
In the second place, the order was issued without notice to, and hearing of, the heirs
of the deceased. The withdrawal of the bank deposits may be viewed as a taking of
possession and charge of the credits of the estate, and apparently within the powers
and duties of a special administrator; but actually, said withdrawal is a waiver by the
special administrator of a prima facie exclusive right of the intestate estate to the bank
deposits in favor of the co-owners of the Juna Subdivision, who were allegedly
claiming the same as alleged by the administrator in his motion (Petition, Annex "C").
The bank deposits were in the name of the deceased; they, therefore, belong prima
facie to his estate after his death. And until the contrary is shown by proper evidence
at the proper stage, when money claims may be filed in the intestate proceedings, the
special administrator is without power to make the waiver or to hand over part of the
estate, or what appears to be a prima facie part of the estate, to other persons on the
ground that the estate is not the owner thereof. If even to sell for valuable
consideration property of the estate requires prior written notice of the application to
the heirs, legatees, or devisees under Rule 89 of the Rules of Court, such notice is
equally, if not more, indispensable for disposing gratuitously of assets of the decedent
in favor of strangers. Admittedly, no such notice was given, and without it the court's
authority is invalid and improper.
The order of 3 September 1965 approving the power of attorney executed by
administrator Tan and appointing himself as attorney-in-fact to sell the subdivision
lots for a price at his discretion is, likewise, void for want of notice and for approving
an improper contract or transaction.
The very rule, Section 4 of Rule 89 of the Rules of Court, relied on by respondent Tan
to sustain the power of attorney for the sale of the pro-indiviso share of the estate in
the subdivision requires "written notice to the heirs, devisees, and legatees who are
interested in the estate to be sold" and, admittedly, administrator Tan did not furnish
such notice. (Answer, pages 1 and 2, paragraph 3, Rollo, page 53) Without such notice,
the order of the court authorizing the sale is void. (Estate of Gamboa vs. Floranza, 12
Phil. 191; Gabriel vs. Encarnacion, 94 Phil. 917)
But respondent Tan holds petitioner Jaroda with actual knowledge of the questioned
order, and to show it he quotes the transcript of stenographic notes of a discussion by
a lawyer of Jaroda about the said order. The discussion, however, took place on 19
March 1966 while the order was issued on 13 September 1965, and there is nothing
in the discussion that may indicate knowledge by Jaroda of the order before, at or
immediately after its issuance.
It has been broadly stated that an administrator is not permitted to deal with himself
as an individual in any transaction concerning trust property. (Pesula's Estate, 64 ALR
2d 851, 150 Cal. App. 2d 462, 310 P 2d 39)
It is well settled that an executrix holds the property of her testator's estate
as a trustee. In re Heydenfeldt's Estate, 117 Cal. 551, 49 P. 713; Firebaugh v.
Burbank, 121 Cal. 186, 53 P. 560. It is equally well settled that an executrix
will not be permitted to deal with herself as an individual in any transaction
concerning the trust property. Civil Code, S 2230. In Davis v. Rock Creek L., F.
& M Co., 55 Cal. 359, at page 364, 36 Am. Rep. 40, it is said: 'The law, for wise
reasons, will not permit one who acts in a fiduciary capacity thus to deal with
himself in his individual capacity.' The following cases are to the same effect:
Wickersham v. Crittenden, 93 Cal. 17, 29, 28 P. 788; Sims v. Petaluma Gas
 Light Co., 131 Cal. 656, 659, 63 P. 1011; Western States Life Ins. Co. v.
Lockwood, 166 Cal. 185, 191, 135 P. 496; In re Estate of Parker, 200 Cal. 132,
139, 251 P 907, 49 A. L. R. 1025. In Wickersham v. Crittenden, supra, 93 Cal.
at page 29, 28 P. at page 790, it is further stated in respect to a transaction
wherein a trustee sought to deal with trust property: 'Courts will not permit
any investigation into the fairness of the transaction, or allow the trustee to
show that the dealing was for the best interest of the beneficiary.' This
language is quoted with approval in the case of Pacific Vinegar & Pickle Works
v. Smith, 145 Cal. 352, 365, 78 P. 550, 104 Am. St. Rep 42. (In re Bogg's Estate,
121 P. 2d 678, 683).
The opinion of some commentators that, as a general rule, auto-contracts are
permissible if not expressly prohibited (See Tolentino, Civil Code of the Philippines,
Vol. IV 1962, pages 375-377), and that there is no express provision of law prohibiting
an administrator from appointing himself as his own agent, even if correct, cannot and
should not apply to administrator of decedent's estates, in view of the fiduciary
relationship that they occupy with respect to the heirs of the deceased and their
responsibilities toward the probate court. A contrary ruling would open the door to
fraud and maladministration, and once the harm is done, it might be too late to correct
it. A concrete example would be for administrator Tan to authorize agent Tan to sell a
lot for P50, with the condition that if he can sell it for more he could keep the
difference; agent Tan sells the lot for P150.00; he retains P100.00 and deposits in the
bank P50.00 "in the name of Antonio V. A. Tan, in trust for Juna Subdivision" (as
worded in the power of attorney. Annex "F-1"); thus, administrator Tan's accounting
to the estate for the sale of the lot for P50 would be in order, but the estate would
have been actually cheated of the sum of P100, which went to agent Tan in his
individual capacity.
The court below also failed to notice that, as alleged in the administrator's petition
(Annex "F" herein), after the death of Carlos Villa Abrille the administrator Tan, in his
personal capacity, had replaced said deceased as manager of the Juna Subdivision by
authority of the other co-owners. By the court's questioned order of 3 September
1965 empowering him to represent the interest of the deceased in the management
of the subdivision, the administrator Tan came to be the agent or attorney-in-fact of
two different principals: the court and the heirs of the deceased on the one hand, and
the majority co-owners of the subdivision on the other, in managing and disposing of
the lots of the subdivision. This dual agency of the respondent Tan rendered him
incapable of independent defense of the estate's interests against those of the
majority co-owners. It is highly undesirable, if not improper, that a court officer and
administrator, in dealing with property under his administration, should have to look
to the wishes of strangers as well as to those of the court that appointed him. A judicial
administrator should be at all times subject to the orders of the appointing Tribunal
and of no one else.
That petitioner Jaroda, as heir of the late Carlos Villa Abrille, should hold a minor
interest (¹/¹¹ of 19%) in the co-ownership known as the Juna Subdivision and that the
early termination of said co-ownership would redound to the benefit of the co-
owners, including the heirs of Carlos Villa Abrille, are beside the point. Jaroda's interest
in the estate demands that she be heard by the court in all matters affecting the
disposal of her share, and that the administrator should primarily protect the interest
of the estate in which she is a participant rather than those of the decedent's co-
owners.
The resolution of this Court in L-27836 (Natividad V. A. Jaroda vs. the Hon. Vicente N.
Cusi, Jr., etc., et al.), dismissing the petition for certiorari and/or mandamus and
stating that appeal in due time is the remedy, is no bar to the present petition, for it
has not been shown that the allegations in both the dismissed petition and those of
the present one are substantially the same. Anyway, certiorari lies if appeal would not
be prompt enough to block the injurious effects of the orders of the lower court
(Silvestre vs. Torres, et al., 57 Phil. 885; Pachoco vs. Tumangday, L-14500, 25 May
1960; Mayormente vs. Robaco Corp., L-25337, 27 Nov. 1967, 21 SCRA 1080).
After the present case was submitted for decision, respondent Tan manifested that
the co-owners of the Juna Subdivision and the heirs of the late Carlos Villa Abrille,
including the petitioner Natividad V. A. Jaroda, had executed a partial partition and
the same has been approved by the probate court. Said approved partial partition has
no effect, one way or the other, upon the orders contested in the present case. For
one thing, it is not definite whether the lots described in the 57 pages of the partition
agreement correspond to those of the Juna Subdivision as described in the power of
attorney.
FOR THE FOREGOING REASONS, the order of 5 May 1965 and 3 September 1965 of
the Court of First Instance of Davao, Branch I, in its Special Proceeding No. 1391, are
hereby set aside and declared null and void. The preliminary injunction heretofore
issued is hereby made permanent. Costs against the respondent, Antonio V. A. Tan, in
his personal capacity.
Concepcion, C.J., Dizon, Makalintal, Sanchez, Castro, Fernando, Capistrano, Teehankee
and Barredo, JJ., concur.
A.M. No. 2430 August 30, 1990
MAURO P. MANANQUIL, complainant,
vs.
ATTY. CRISOSTOMO C. VILLEGAS, respondent.
Geminiano M. Eleccion for complainant.
RESOLUTION
CORTES, J.:
In a verified complaint for disbarment dated July 5, 1982, Mauro P. Mananquil charged
respondent Atty. Crisostomo C. Villegas with gross misconduct or malpractice
committed while acting as counsel of record of one Felix Leong in the latter's capacity
as administrator of the Testate Estate of the late Felomina Zerna in Special
Proceedings No. 460 before then Court of First Instance of Negros Occidental. The
complainant was appointed special administrator after Felix Leong died.
In compliance with a resolution of this Court, respondent filed his comment to the
complaint on January 20, 1983. After complainant filed his reply, the Court resolved
to refer the case to the Solicitor General for investigation, report and
recommendation.
In a hearing conducted on May 15, 1985 by the investigating officer assigned to the
case, counsel for the complainant proposed that the case be considered on the basis
of position papers and memoranda to be submitted by the parties. Respondent
agreed. Thus, the investigating officer required the parties to submit their respective
position papers and memoranda, with the understanding that with or without the
memoranda, the case will be deemed submitted for resolution after the expiration of
30 days. In compliance, both parties submitted their respective position papers; but
no memorandum was filed by either party. Thereafter, the case was deemed
submitted.
In the pleadings submitted before the Court and the Office of the Solicitor General,
complainant alleges that over a period of 20 years, respondent allowed lease contracts
to be executed between his client Felix Leong and a partnership HIJOS DE JOSE
VILLEGAS, of which respondent is one of the partners, covering several parcels of land
of the estate, i.e. Lots Nos. 1124, 1228, 2221, 2402, 3939, 3942 and 3957 of the Tanjay
Cadastre, under iniquitous terms and conditions. Moreover, complainant charges that
these contracts were made without the approval of the probate court and in violation
of Articles 1491 and 1646 of the new Civil Code.
On the basis of the pleadings submitted by the parties, and other pertinent records of
the investigation, the Solicitor General submitted his report dated February 21, 1990,
finding that respondent committed a breach in the performance of his duties as
counsel of administrator Felix Leong when he allowed the renewal of contracts of
lease for properties involved in the testate proceedings to be undertaken in favor of
HIJOS DE JOSE VILLEGAS without notifying and securing the approval of the probate
court. However, the Solicitor General opined that there was no sufficient evidence to
warrant a finding that respondent had allowed the properties to be leased in favor of
his family partnership at a very low rental or in violation of Articles 1491 and 1646 of
the new Civil Code. Thus, the Solicitor General recommended that respondent be
suspended from the practice of law for a period of THREE (3) months with a warning
that future misconduct on respondent's part will be more severely dealt with [Report
and Recommendation of the Solicitor General, pp. 1-10; Rollo, pp. 37-46. Also,
Complaint of the Solicitor General, pp. 1-3; Rollo, pp. 47-49].
As gleaned from the record of the case and the report and recommendation of the
Solicitor General, the following facts are uncontroverted:
That as early as March 21, 1961, respondent was retained as
counsel of record for Felix Leong, one of the heirs of the late
Felomina Zerna, who was appointed as administrator of the Testate
Estate of the Felomina Zerna in Special No. 460 on May 22, 1961;
That, a lease contract dated August 13, 1963 was executed between
Felix Leong and the "Heirs of Jose Villegas" represented by
respondent's brother-in-law Marcelo Pastrano involving, among
others, sugar lands of the estate designated as Lot Nos. 1124, 1228,
2221, 2402, 3939, 3942 and 3957 of the Tanjay Cadastre;
That Felix Leong was designated therein as administrator and
"owner, by testamentary disposition, of 5/6 of all said parcels of
land";
That, the lifetime of the lease contract was FOUR (4) sugar crop
years, with a yearly rental of TEN PERCENT (10%) of the value of the
sugar produced from the leased parcels of land;
That, on April 20, 1965, the formal partnership of HIJOS DE JOSE
VILLEGAS was formed amongst the heirs of Jose Villegas, of which
respondent was a member;
That, on October 18, 1965, another lease contract was executed
between Felix Leong and the partnership HIJOS DE JOSE VILLEGAS,
 containing basically the same terms and conditions as the first
contract, with Marcelo Pastrano signing once again as
representative of the lessee;
That, on March 14, 1968, after the demise of Marcelo Pastrano,
respondent was appointed manager of HIJOS DE JOSE VILLEGAS by
the majority of partners;
That, renewals of the lease contract were executed between Felix
Leong and HIJOS DE JOSE VILLEGAS on January 13, 1975 and on
December 4, 1978, with respondent signing therein as
representative of the lessee; and,
That, in the later part of 1980, respondent was replaced by his
nephew Geronimo H. Villegas as manager of the family partnership.
Under the above circumstances, the Court finds absolutely no merit to complainant's
charge, and the Solicitor General's finding, that respondent committed acts of
misconduct in failing to secure the approval of the court in Special Proceedings No.
460 to the various lease contracts executed between Felix Leong and respondent's
family partnership.
Pursuant to Section 3 of Rule 84 of the Revised Rules of Court, a judicial executor or
administrator has the right to the possession and management of the real as well as
the personal estate of the deceased so long as it is necessary for the payment of the
debts and the expenses of administration. He may, therefore, exercise acts of
administration without special authority from the court having jurisdiction of the
estate. For instance, it has long been settled that an administrator has the power to
enter into lease contracts involving the properties of the estate even without prior
judicial authority and approval [See Ferraris v. Rodas, 65 Phil. 732 (1938); Jocson de
Hilado v. Nava, 69 Phil. 1 (1939); San Diego, Sr. v. Hombre, G.R No. L-19265, May 29,
1964, 11 SCRA 165].
Thus, considering that administrator Felix Leong was not required under the law and
prevailing jurisprudence to seek prior authority from the probate court in order to
validly lease real properties of the estate, respondent, as counsel of Felix Leong,
cannot be taken to task for failing to notify the probate court of the various lease
contracts involved herein and to secure its judicial approval thereto.
Nevertheless, contrary to the opinion of the Solicitor General, the Court finds
sufficient evidence to hold respondent subject to disciplinary sanction for having, as
counsel of record for the administrator in Special Proceedings No. 460, participated in
the execution in 1975 and 1978 of renewals of the lease agreement involving
properties of the estate in favor of the partnership HIJOS DE JOSE VILLEGAS, of which
respondent is a member and in 1968 was appointed managing partner.
By virtue of Article 1646 of the new Civil Code, the persons referred to in Article 1491
are prohibited from leasing, either in person or through the mediation of another, the
properties or things mentioned in that article, to wit:
xxx xxx xxx
(1) The guardian, the property of the person or persons who may be
under his guardianship;
(2) Agents, the property whose administration or sale may have
been intrusted to them, unless the consent of the principal have
been given;
(3) Executors and administrators, the property of the estate under
administration
(4) Public officers and employees, the property of the State or of any
subdivision thereof, or of any government owned or controlled
corporation, or institution, the administration of which has been
intrusted to them; this provision shall apply to judges and
government experts who, in any manner whatsoever, take part in
the sale;
(5) Justices, judges, prosecuting attorneys, clerks of superior and
inferior courts, and other officers and employees connected with
the administration of justice, the property or rights in litigation or
levied upon on execution before the court within whose jurisdiction
or territory they exercise their respective functions; this prohibition
includes the act of acquiring by assignment and shall apply to
lawyers, with respect to the property and rights which may be the
object of any litigation in which they may take part by virtue of their
profession.
(6) Any others specially disqualified by law
xxx xxx xxx
[Article 1491 of the new Civil Code; Emphasis supplied.]
The above disqualification imposed on public and judicial officers and lawyers is
grounded on public policy considerations which disallow the transactions entered into
by them, whether directly or indirectly, in view of the fiduciary relationship involved,
or the peculiar control exercised by these individuals over the properties or rights
covered [See Rubias v. Batiller, G.R. No. L-35702, May 29, 1973, 51 SCRA 120;
Maharlika Publishing Corporation v. Tagle, G.R. No. 65594, July 9, 1986, 142 SCRA 553;
Fornilda v. The Branch 164, RTC Fourth Judicial Region, Pasig, G.R. No. 72306, October
5, 1988, 166 SCRA 281 and January 24, 1989, 169 SCRA 351].
Thus, even if the parties designated as lessees in the assailed lease contracts were the
"Heirs of Jose Villegas" and the partnership HIJOS DE JOSE VILLEGAS, and respondent
signed merely as an agent of the latter, the Court rules that the lease contracts are
covered by the prohibition against any acquisition or lease by a lawyer of properties
involved in litigation in which he takes part. To rule otherwise would be to lend a stamp
of judicial approval on an arrangement which, in effect, circumvents that which is
directly prohibited by law. For, piercing through the legal fiction of separate juridical
personality, the Court cannot ignore the obvious implication that respondent as one
of the heirs of Jose Villegas and partner, later manager of, in HIJOS DE JOSE VILLEGAS
stands to benefit from the contractual relationship created between his client Felix
Leong and his family partnership over properties involved in the ongoing testate
proceedings.
In his defense, respondent claims that he was neither aware of, nor participated in,
the execution of the original lease contract entered into between his client and his
family partnership, which was then represented by his brother-in-law Marcelo
Pastrano. And although he admits that he participated in the execution of subsequent
renewals of the lease contract as managing partner of HIJOS DE JOSE VILLEGAS, he
argues that he acted in good faith considering that the heirs of Filomena Zerna
consented or acquiesced to the terms and conditions stipulated in the original lease
contract. He further contends that pursuant to the ruling of the Court in Tuason v.
Tuason [88 Phil. 428 (1951)] the renewal contracts do not fall within the prohibition
of Articles 1491 and 1646 since he signed the same as a mere agent of the partnership.
Respondent's contentions do not provide sufficient basis to escape disciplinary action
from this Court.
It taxes this Courts imagination that respondent disclaims any knowledge in the
execution of the original lease contract between his client and his family partnership
represented by his brother-in-law. Be that as it may, it cannot be denied that
respondent himself had knowledge of and allowed the subsequent renewals of the
lease contract. In fact, he actively participated in the lease contracts dated January 13,
1975 and December 4, 1978 by signing on behalf of the lessee HIJOS DE JOSE
VILLEGAS.
Moreover, the claim that the heirs of Filomena Zerna have acquiesced and consented
to the assailed lease contracts does not militate against respondent's liability under
the rules of professional ethics. The prohibition referred to in Articles 1491 and 1646
of the new Civil Code, as far as lawyers are concerned, is intended to curtail any undue
influence of the lawyer upon his client on account of his fiduciary and confidential
association [Sotto v. Samson, G.R. No. L-16917, July 31, 1962, 5 SCRA 733]. Thus, the
law makes the prohibition absolute and permanent [Rubias v. Batiller, supra]. And in
view of Canon 1 of the new Code of Professional Responsibility and Sections 3 & 27 of
Rule 138 of the Revised Rules of Court, whereby lawyers are duty-bound to obey and
uphold the laws of the land, participation in the execution of the prohibited contracts
such as those referred to in Articles 1491 and 1646 of the new Civil Code has been
held to constitute breach of professional ethics on the part of the lawyer for which
disciplinary action may be brought against him [See Bautista v. Gonzalez, Adm. Matter
No. 1625, February 12, 1990). Accordingly, the Court must reiterate the rule that the
claim of good faith is no defense to a lawyer who has failed to adhere faithfully to the
legal disqualifications imposed upon him, designed to protect the interests of his client
[See In re Ruste, 70 Phil. 243 (1940); Also, Severino v. Severino, 44 Phil. 343 (1923)].
Neither is there merit in respondent's reliance on the case of Tuason v. Tuason [supra.]
It cannot be inferred from the statements made by the Court in that case that
contracts of sale or lease where the vendee or lessee is a partnership, of which a
lawyer is a member, over a property involved in a litigation in which he takes part by
virtue of his profession, are not covered by the prohibition under Articles 1491 and
1646.
However, the Court sustains the Solicitor General's holding that there is no sufficient
evidence on record to warrant a finding that respondent allowed the properties of the
estate of Filomena Zerna involved herein to be leased to his family partnership at very
low rental payments. At any rate, it is a matter for the court presiding over Special
Proceedings No. 460 to determine whether or not the agreed rental payments made
by respondent's family partnership is reasonable compensation for the use and
occupancy of the estate properties.
Considering thus the nature of the acts of misconduct committed by respondent, and
the facts and circumstances of the case, the Court finds sufficient grounds to suspend
respondent from the practice of law for a period of three (3) months.
WHEREFORE, finding that respondent Atty. Crisostomo C. Villegas committed acts of
gross misconduct, the Court Resolved to SUSPEND respondent from the practice of
law for four (4) months effective from the date of his receipt of this Resolution, with a
warning that future misconduct on respondent's part will be more severely dealt with.
Let copies of this Resolution be circulated to all courts of the country for their
information and guidance, and spread in the personal record of Atty. Villegas.
G.R. No. L-9686 May 30, 1961
FELICISIMO C. JOSON, administrator-appellee,
vs.
EDUARDO JOSON, ET AL., heirs-appellants.
Lavides, Sicat & Lavides for administrator-appellee.
Mario S. Garcia for heirs-appellants.
ANGELO, J.:
Tomas Joson died on July 5, 1945 in Quezon, Nueva Ecija leaving behind heirs and
properties. He married three times and was survived by nine (9) heirs: two (2) children
and grandchildren by his first wife Eufemia de la Cruz; two (2) daughters by his second
wife Pomposa Miguel and his third wife and surviving widow Dominga M. Joson. Upon
his death, his will was presented to the Court of First Instance of Nueva Ecija by his
son Felicisimo Joson for probate. In August, 1945, said will having been duly probated,
Felicisimo Joson was appointed administrator of the estate and, accordingly, he filed
an inventory of the properties left by the deceased.
On April 15, 1948, the administrator filed his first account for the year 1945-1946. This
was ordered by the court to be examined by the clerk of court but the same has never
been approved. On July 19, 1948, he filed his second account for the year 1946-1947
which was also referred to the clerk of court for examination. The same has never
been also approved by the court. On November 11, 1948, the administrator filed
another account for the year 1947-1948 and, upon motion of the heirs, he was
ordered to file an accounting covering the properties under his administration. On
September 7, 1954, Eduardo Joson, one of the heirs, filed an opposition to all the
accounts filed by the administrator where he alleged that the administrator
diminished the shares of the heirs in the yearly produce of the properties and had
padded his expenses of administration, and on September 29, 1954, the same heir
filed another motion praying the court to order the administrator to post a bond in
the amount of P50,000.00 For the reason that from the accounts represented by him
to be the true income of the estate from 1947 to 1953 there was a big difference of
P132,600.00 which the administrator should account for to the heirs. On October 14,
1954, the administrator submitted an amended statement of accounts for the same
years which were objected by two more heirs on the ground that the administrator
had reported for the years 1947-1952 an income short of what was actually received
and expenses much bigger than those actually incurred by him.
In the meantime, or on December 30, 1952, the heirs were able to compromise their
differences and entered into an extrajudicial settlement and partition of the entire
estate under the provisions of Section 1, Rule 74, of the Rules of Court which provides
for the settlement of the estate without court intervention. This settlement was
contained in two documents executed on the same date wherein they manifested that
they are entering into it because of their desire to put an end to the judicial proceeding
and administration. But, as the court was never informed of this extrajudicial
settlement either by the administrator or by the heirs, it issued on May 19, 1954 an
order requiring the administrator to file an accounting of his administration from 1949
to 1954, which accordingly the administrator complied with by submitting an
amended statement of his accounts as already mentioned above.
However, on November 25, 1954, without said accounts having been heard or
approved, the administrator filed a motion to declare the proceedings closed and
terminated and to relieve him of his duties as such, which motion was amended by
him on January 15, 1955. Heir Eduardo Joson filed an opposition to said motion but,
after hearing, the court issued an order declaring the proceedings terminated and
relieving the administrator not only of his duties as such but also of his accounts
notwithstanding the heirs' opposition to said accounts. Hence this appeal:
In granting the motion of the administrator to declare the proceedings closed and
terminated and relieving him of his duties and of his accounts, the trial court made
the following pronouncement:
. . . It is claimed by the oppositor that the estate cannot be declared closed
and terminated for the reason that some of the accounts submitted by the
administrator for the years 1945 to 1948 have not been approved. The Court
does not find any logic in this contention. The heirs knew on December 30,
1952, when they entered into an extra-judicial settlement of the estate, the
existence of those accounts, but nothing is mentioned in the said extra-
judicial settlement regarding the same. They are, therefore, presumed to
have approved these accounts and have their opposition thereto. There is,
therefore, no reason to suspend the closing of this proceeding and make the
same depend upon the approval of these old accounts. To do so would be
like making the accessory more important than the principal. There is no
doubt that the report of the administrator of his administration is a mere
incident in this proceeding to wind up the estate of the deceased. If the
parties concerned have already entered into an extra-judicial settlement of
the estate, the same should put an end to this proceeding. Once this
proceeding is terminated, the incidents thereto must yield, since the only
purpose of submitting a report of the accounts by the administrator is to
facilitate the liquidation. The administration of an estate cannot be an end
but only a means of settlement of the estate. It, therefore, becomes
unnecessary and a mere waste of time to call the administrator to account
for, or to report on, his administration from the moment that the heirs have
already entered into an extra-judicial settlement. To do so, would amount to
 a modification of the extra-judicial settlement which is the law between the disregarded the express provisions of our rules relative to the settlement of accounts
parties, which include the oppositors herein. of a judicial administrator.

The issues now posed by appellants are: (1) Is the duty of an administrator to make an
accounting of his administration a mere incident which can be avoided once the estate
has been settled?; (2) Are the proceedings deemed terminated by the mere execution
of an extrajudicial partition of the estate without the necessity of having the accounts
of the administrator heard and approved by the court?; and (3) Is the administrator
ipso facto relieved of his duty of proving his account from the moment said partition
has been executed? Appellants answer these questions in the negative with the
argument that if the contrary is to be upheld as was done by the trial court the same
would be contrary to the express provisions of our rules relative to the duties of a
judicial administrator. Hence, they argue, the trial court committed an error in closing
the estate in disregard of the accounts submitted by the administrator.
We find merit in this contention. To begin with, Section 1 of Rule 86 categorically
charges an administrator "with the whole of the estate of the deceased which has
come into his possession at the value of appraisement contained in the inventory; with
all the interest, profit, and income of such an estate; and with the proceeds of so much
of the estate as is hold by him, at the price at which sold." Section 8 of the same rule
imposes upon him the duty to render an account of his administration within one year
from his appointment, unless the court otherwise directs, as well as to render such
further accounts as the court may require until the estate is fully settled. Section 10
likewise provides that before an account of the administrator is allowed notice shall
be given to all persons interested of the time and place of examining and allowing the
same. And finally Section 9 expressly directs that the court shall examine the
administrator upon oath with respect to every matter relating to his account except
when no objection is made to the allowance of the account and its correctness is
satisfactorily established by competent testimony.
The fact that all the heirs of the estate have entered into an extrajudicial settlement
and partition in order to put an end to their differences cannot in any way be
interpreted as a waiver of the objections of the heirs to the accounts submitted by the
administrator not only because to so hold would be a derogation of the pertinent
provisions of our rules but also because there is nothing provided in said partition that
the aforesaid accounts shall be deemed waived or condoned. While the attitude of
the heirs in concluding said extrajudicial settlement is plausible and has contributed
to the early settlement of the estate, the same cannot however be considered as
release of the obligation of the administrator to prove his accounts. This is more so
when, according to the oppositors, the administrator has committed in his accounts a
shortage in the amount of P132,600.00 which certainly cannot just be brushed aside
by a mere technicality.
WHEREFORE, the order appealed from is set aside. The case shall be remanded to the
trial court for further proceedings in line with this decision. No costs.
Bengzon, C.J., Padilla, Labrador, Concepcion, Reyes, J.B.L., Paredes, Dizon, De Leon and
Natividad, JJ., concur.
Barrera, J., took no part.

It thus appears that the duty of an administrator to render an account is not a mere
incident of an administration proceeding which ran be waived or disregarded when
the same is terminated, but that it is a duty that has to be performed and duly acted
upon by the court before the administration is finally ordered closed and terminated.
Here the administrator has submitted his accounts for several years not only motu
proprio but upon requirement of the court, to which accounts the heirs have
seasonably submitted their opposition. And when the administrator moved the court
to close the proceedings and relieve him of his administration and of his accounts, the
heirs who objected thereto objected likewise to the closing of the proceedings
invoking their right to be heard but the court ignored their opposition and granted the
motion setting forth as reasons therefor what we quoted in the early part of this
decision. Verily, the trial court erred in acceding to the motion for in doing so it
G.R. No. L-50277 February 14, 1980
TESTATE ESTATE OF THE LATE DOMINADOR TUMANG, MAGDALENA A. TUMANG,
administratrix-appellee,
vs.
GUIA T. LAGUIO AND HER MINOR CHILDREN, movants-appellants.
ANTONIO, J.:
This case was forwarded to this Court by the Court of Appeals on the ground that it
involves purely legal issues. The factual background, as found by the Court of Appeals,
is as follows:
In Special Proceeding No. 1953 involving the estate of the late Dominador Tumang
and pending before the Court of First Instance of Pampanga, the widow of the
deceased, namely Magdalena A. Tumang, administratrix and executrix of the will, filed
a petition to declare the testate proceedings definitely terminated and closed with
respect to herself and two of her children — Melba Tumang Ticzon and Nestor A.
Tumang. The petition was premised on the fact that the aforesaid heirs had already
acknowledged receipt of the properties adjudicated to them, and in order for such
properties to be transferred in their names, there was need for an order of the court
declaring the proceedings closed with respect to the aforesaid heirs. The petition was
opposed by appenee's daughter, Guia T. Laguio and her children on the ground that
appellee, as administratrix and executrix, had not yet delivered all properties
adjudicated to them. Moreover, the oppositors contended that there could be no
partial termination of the proceedings. Thereafter, the administratrix withdrew the
aforementioned petition.
During the hearing of the motion to withdraw petition, Magdalena Tumang, as
required by the court, filed a pleading captioned "Compliance", alleging that as shown
by the attached receipts issued by the BIR, the estate and inheritance taxes had been
fully paid; that as certified by the Deputy Clerk of Court, no claim has been presented
that has not already delivered all the properties and dividends of the shares of stock
adjudicated to her and her minor children since the approval of the original and
amendatory projects of partition; and that with such admission, the court no longer
has jurisdiction to entertain the motion under consideration.
Resolving the foregoing, the court a quo issued the first questioned Order on February
5, 1971, stating in part, the following:
Considering the opposition well founded, the court hereby
considers the motion to require administratrix to render an
accounting untenable, as the final accounting of the administratrix
was already approved and therefore denies the motion of oppositor
and counter-petitioner dated Jan. 25, 1971. 2
A motion for reconsideration of the foregoing Order was filed by Guia T. Laguio and
her minor children. On August 16, 1971, the court a quo issued the second questioned
Order denying the motion for reconsideration in the following manner:
After a careful consideration of the grounds relied upon by the
movant counter-petitioner, this Court resolves to deny the motion
for reconsideration for the reason that in view of said counter-
petitioner's receipt of the cash dividends in question without first
requiring the administratrix the accounting now being sought to be
rendered for purposes of determining the correctness of the cash
dividends constitutes already a waiver on her part to question such
correctness of the aforesaid cash dividends. The counter-petitioner
is being assisted by counsel in the person of her own husband, and
who being well-versed in such legal process, could have rejected
receipt of the said cash dividends on the shares of stock if the
correctness of the same was at that time being doubted. To say the
least, therefore, the grounds for the motion for reconsideration are,
in the honest opinion of this Court, unmeritorious, and all the
motion, in effect, is hereby denied. 3
The sole issue is whether or not the court should have required the executrix to render
an accounting of the cash and stock dividends received after the approval of her final
accounts. A corollary issue is whether or not petitioners have waived their right to
demand such accounting.
Section 8 of Rule 85 provides that the "executor or administrator shall render an
account of his administration within one (1) year from the time of receiving letters
testamentary or of administration ..., and he shall render such further accounts as the
court may requite until the estate is wholly settled."
In the instant case, further accounts by the executrix appear to be in order, in view of
the fact that the dividends sought to be accounted for are not included in the final
accounts rendered by the executrix. It appears that the interests of all the parties will
be better served and the conflict between petitioners and respondent will be resolved
if such additional accounting is made. Further, "it has been held that an executor or
administrator who receives assets of the estate after he has filed an account should
file a supplementary account thereof, and may be compelled to do so, but that it is
only with respect to matters occuring after the settlement of final account that
representatives will be compelled to file supplementary account." 4 It is only in a case
where the petition to compel an executor to account after he has accounted and has
been discharged fails to allege that any further sums came into the hands of the
executor, and the executor specifically denies the receipt of any further sums that the
accounting should be denied. 5

There is no question that in the instant case, the fact that the executrix received funds
of the estate after the approval of her final accounts and before the issuance of an
order finally closing the proceedings is admitted. She must, therefore, account for the
same, in consonance with her duty to account for all the assets of the decedent's
estate which have come into her possession by virtue of her office. 6 An executor
should account for all his receipts and disbursements since his last accounting. 7

We disagree with the lower court's finding that petitioners, by receiving the dividends
without requiring an accounting, had waived their right to do so. The duty of an
executor or administrator to render an account is not a mere incident of an
administration proceeding which can be waived or disregarded. It is a duty that has to
be performed and duly acted upon by the court before the administration is finally
ordered closed and terminated, 8 to the end that no part of the decedent's estate be
left unaccounted for. The fact that the final accounts had been approved does not
divest the court of jurisdiction to require supplemental accounting for, aside from the
initial accounting, the Rules provide that "he shall render such further accounts as the
court may require until the estate is wholly settled." 9

WHEREFORE, in view of all the foregoing, the Orders of the lower court dated February
5, 1971 and August 16, 1971 are set aside, and respondent executrix is hereby ordered
to render a supplemental accounting of all cash and stock dividends as well as other
properties of the estate which came into her possession after the approval of her final
accounts.

SO ORDERED.
G.R. No. L-4090 January 31, 1952
INTESTATE ESTATE OF THE DECEASED HONOFRE LEYSON, deceased. VICTORIO L.
RODRIGUEZ, administrator-appellant, and
MARGARITA LEYSON LAURENTE, heiress-appellant,
vs.
PABLO M. SILVA, movant-appellee.
Eliseo Caunca for appellants.
Fidel J. Silva for appellee.
TUASON, J.:
This appeal is from an order of the Court of First Instance of Manila, Honorable Rafael
Amparo, Judge authorizing the cancellation of the bond of Pablo M. Silva who had
resigned as joint administrator of the intestate estate of Honofre Leyson, deceased,
and allowing Silva P600 as compensation for his services. The appellants are the
remaining administrator and an heir of the deceased.
The appeal was elevated to this Court on the appellant's manifestation that they would
raise only questions of law. Following are the assignments of error:
The lower court erred in issuing its order of August 19, 1949, granting Pablo
M. Silva's motion filed on August 9, 1949, and ordering the cancellation of his
bond and authorizing him to collect from the estate the sum of P600.00 as
his administrator's fees, inasmuch as said order is not in accordance with the
provisions section 7, Rule 86 of the rules of Court.
That taking for granted, but without admitting that the compensation of the
administrators from their appointment up to the issuance of the order dated
August 19, 1950, granting the resignation of Mr. Pablo M. Silva that the sum
of P600 is reasonable, the lower court, however, erred in not providing that,
in view of the fact that in this proceeding there are two administrators
according to the services actually rendered by them respectively, in
accordance with the provision of Section 7, paragraph 2, Rule 86 of the Rules
of court, and that the sum of P100.00 already received by the appellee be
deducted from any amount that may finally be conceded to him.
Lastly, the lower court erred in cancelling Mr. Pablo M. Silva's administrators
bond, inasmuch as few months before the issuance of said order dated
August 19, 1950, granting his resignation, he secured the cancellation of
Transfer Certificate of Title No. 13 (6947) Quezon City, and Transfer
Certificate of Title No. 11778 Manila, issued in the name of Honofre Leyson,
and in their stead another titles were issued in the name of Mr. Pablo M.
Silva, the herein appellee, in a doubtful manner.
The first two assignments of error raise the same question or allied questions and may
well be considered together. This question is, may the court fix an administrator's or
executor's fee in excess of the fees prescribed by section 7 of Rule 86, which follows?
SEC. 7. What expenses and fees allowed executor or administrator. Not to
charge for services as attorney. Compensation provided by will controls unless
renounced. An executor or administrator shall be allowed the necessary
expenses in the care, management, and settlement of the estate, and for his
services, four pesos per day for the time actually and necessarily employed,
or a commission upon the value of so much of the estate as comes into his
possession and is finally disposed of by him in the payment of debts,
expenses, legacies, or distributive shares, or by delivery to heirs or devises,
of two per centum of the first five thousand pesos of such value, one per
centum of such value as exceeds five thousand pesos and does not exceed
thirty thousand pesos, one-half per centum of so much of such value as
exceeds thirty thousands pesos and does not exceed one hundred thousand
pesos, and one-quarter per centum of so much of such value as exceeds one
hundred thousand pesos. But in any special case, where the estate is large,
and the settlement has been attended with great difficulty, and has required
a high degree of capacity on the part of the executor or administrator, a
greater sum may be allowed. If objection to the fees allowed be taken, the
allowance may be reexamined on appeal.
If there are two or more executors or administrators, the compensation shall
be apportioned among them by the court according to the services actually
rendered by them respectively.
When the executor or administrator is an attorney he shall not charge against
the estate any professional fees for legal services rendered by him.
When the deceased by will makes some other provision for the
compensation of his executor, that provision shall be a full satisfaction for his
services unless by a written instrument filed in the court he renounces all
claim to the compensation provided by the will.
It will be seen from this provision that a greater sum may be allowed "in any special
case, where the estate is large, and the settlement has been attended with great
difficulty, and has required a high degree of capacity on the part of the executor or
administrator." And so it has been held that "the amount of an executor's fee allowed
by the Court of first Instance in any special case under the provisions of Section 680
of the Code of Civil Procedure is a matter largely in the discretion of the probate court,
which will not be disturbed on appeal, except for an abuse of discretion." (Rosentock,
vs. Elser, 48 Phil. 709.)
The order of which the appellants complain does not state the work performed by the
appellee, but the inventory shows the appraised value of the estate to be P22,116.46,
itemized as follows:
Cash on deposit in the Philippine National Bank .......................
Accounts receivable .......................................................................
Real Estate ........................................................................................
Personal Property ............................................................................
is that the appellee is in possession of a residential lot in Cubao, Quezon City, which
belonged to the deceased Honofre Leyson. But the appellee claims that this lot was
sold to him by Leyson on March 2, 1945. Certainly it was already in possession when
he and appellant Rodriguez took over the administration from the special
administratrix. This land therefore did not come into De Silva's hands in pursuance or
in the inventory prepared by or in conjunction with one of the appellants. Even
granting then, for the sake of argument, that De Silva has no valid title to this lot, the
sureties are not chargeable for it on the bond. De Silva's liability is personal and
exclusive of the sureties who are the parties mostly affected by the third assignment
P8,159.43
of error.
500.00
Moreover, there is a pending suit over this property and that suit affords the estate
12,061.03
ample protection against the said property being alienated pending final disposition
1,291.00
of the litigation.

And it is stated in the appellee's brief that prior to his appointment and that of Victorio Upon the foregoing consideration, the order appealed from is affirmed, with costs.
L. Rodriguez as joint administrators, Justa Gomez, the decedent's cousin with whom
Leyson lived was special administratrix; that during Justa Gomez's incumbency which Paras, C.J., Pablo, Bengzon, Padilla, Montemayor, Reyes, Jugo and Bautista Angelo, JJ.,
lasted till December 8, 1947, the lease holdings of the said estate were renting about concur.
900.00 a month; that after appellee's appointment, and through his initiative, their
income was increased to P1,300.00 and two parcels of land located in San Juan, Rizal,
were paid for in full and the corresponding certificates of title secured. It also asserted,
and not denied, that the appellee was instrumental in the gathering of decedent's
personal effects, and that as the result of his motion a court order, whereby Margarita
Leyson Laurente, one of the now appellants, had been authorized to withdraw from
the bank P3,400 as advance payment of her share of the inheritance, was
reconsidered and set aside. The fact that the appellee is an attorney-at-law has served
the estate in good stead, has served the estate in good stead, and this ought not be
lost sight it. Although being a lawyer is by itself not a factor in the assessment of an
administrator's fee, it should be otherwise as in this case the administrator was able
to stop what appeared to be an improvident disbursement of a substantial amount
without having to employ outside legal help at an additional expense to estate.

The appellant having announced that no questions of fact would be discussed is

estopped from contesting the above allegations. On the basis of the services thus
specified, coupled with the fact that the appellee worked as co-probate court
committed an abuse of discretion in granting him P600.00 or P700.00, as fee
independent of the fee that might be allowed the other administrator.

As to the cancellation of the appellee's bond, which is the subject of the third ground
for appeal, there is no showing that De Silva was guilty of misappropriation or any of
the acts of commission or omission for which his bond could be held liable under Rule
86. The sole ground for the insistence that this cancellation should have been withheld
G.R. No. L-13031 May 30, 1961 February 6, 1947 the estate funds amounted to P7,986.53; that on June 8, 1948 he
reported to the Court additional expenses incurred amounting to P865.20, thus
INTESTATE ESTATE OF JAMES R. BURT, deceased. THE PHILIPPINE TRUST CO., leaving a balance of P7,121.33; that thereafter he disbursed the sum of P250.00 to
administrator-appellee, defray the burial expenses of the deceased, thus leaving a balance of P6,871.33; that
vs. on several occasions during the period from February 22, 1946 to May 14, 1947, he
LUZON SURETY CO., INC., surety-appellant. had delivered to Feliciano Burt adoptive son of the deceased James R. Burt different
sums of money totalling P5,825.00, thus leaving a balance of P972.33. After
Feria, Manglapus and Associates for administrator-appellee. considering this statement, the Court, on September 18, 1948, issued an order finding
Tolentino, Garcia and D. R. Cruz for surety-appellant. Picard, guilty of having disbursed funds of the estate amounting to about P8,000.00,
without authority. For this reason, the Court referred the matter to the City Fiscal of
Manila for investigation. Result of this was the prosecution of Picard, for estafa. Having
DIZON, J.:
pleaded guilty to the charge, judgment of conviction was accordingly rendered, and
he was, besides, held civilly liable in the sum of P8,000.00.
On February 14, 1946, the Court of First Instance of Manila appointed Francis R.
Picard, Sr. as Administrator the Intestate Estate of the deceased James R. Burt (Civil
On July 8, 1957 the Court issued an order requiring appellant Luzon Surety Co., Inc. to
Case No. 71872) upon a bond of P1,000.00. Thereafter he submitted and the Court
show cause why the administrator's bond filed by it on behalf of Picard would not be
approved his bond in the required amount, with appellant Luzon Surety Co., Inc. as his
confiscated. Appellant filed a motion to set aside said order upon the following
surety.
grounds: firstly, that the Court cannot order the confiscation of the administrator's
bond, on prejudice or injury to creditors, legatees or heirs of the estate of James R.
For reasons that do not fully appear of record, on May 1, 1948 the Court dismissed
Burt having been shown, and secondly, that "a probate court cannot, ex proprio motu,
Picard, as administrator and appointed the Philippine Trust Co. in his place. After
prosecute the probate bond." On August 3, 1957 the Court denied appellant's motion
qualifying for the position, the latter, on July 19, 1948, submitted an inventory-report
and ordered the confiscation of its bond. After the denial of appellant's lotion for
showing that the only asset of the Intestate Estate of Burt that had come into its
reconsideration, it took the present appeal.
possession was the sum of P57.75 representing the balance of the checking account
of said deceased with the Philippine National Bank. In view thereof, on July 26, 1948
Appellant's contention that the probate court, ex proprio motu, cannot order the
the Court issued an order the pertinent portion of which reads as follows:
confiscation or forfeiture of an administrator's bond, is clearly without merit.
Whatever may be the rule prevailing in other jurisdictions, in ours probate court is
A review, however, of the record of the case reveals that former possessed with an all-embracing power not only in requiring but also in fixing the
Administrator Francis Picard, filed on February 6, 1941, an inventory of the
amount, and executing or forfeiting an administrator's bond. The execution or
estate of the deceased, from which it appears that the sole property he found
forfeiture of an administrator's bond, is deemed be a necessary part and incident of
was the amount of P8,873.73 in current account with the Philippine National
the administration proceedings as much as its filing and the fixing of its amount. The
Bank. This amount was reduced to P7,986.53 after deducting therefrom his
rule, therefore, is that the probate court may have said bond executed in the same
expenses in the amount of P887.22; and as reported by him in his petition
probate proceeding.
filed on June 8, 1948, the further expenses in the amount of P865.20 were
deducted, thereby leaving the balance of P7,121.33 as of May 27, 1948.
Moreover, the condition of the administrator's bond in question is that Francis L.
Picard shall faithfully execute the orders and decrees of the court; that if he did so,
In view of the foregoing, the Court hereby orders said Francis Picard, to
the obligation shall become void, otherwise it shall remain in full force and effect. In
deliver within forty-eight hours (48) from the receipt of a copy of the order
having been established that Picard disbursed funds of the estate without authority,
the difference of P7,063.58 to the present Administrator, Philippine Trust
the conclusion follows that he had and his surety became bound upon the terms of
Company; otherwise he will be ordered committed to prison for contempt
their bond.
until he shall have complied with this order.
Appellant also contends that it was not proper for the lower court to order the
In compliance with the above order, Picard, submitted an itemized statement of
confiscation of its bond because no prejudice or injury to any creditor, heir or other
disbursements made by him as administrator of the estate, showing that as of
interested person has been proved. This is also without merits. According to the
record, the claims against the estate filed by Antonio Gardiner and Jose Teruel for the
sum of P200.00 and P3,205.00, respectively, were approved by the probate court but
the same have remained unpaid because of lack of funds.

Finally, appellant claims that it had been released from liability as surety because it
received no notice of the proceedings for the determination of the accountability of
the administrator. This contention we also find to be untenable.

From the nature of the obligation entered into by the surety on an administrator's
bond — which makes him privy to the proceedings against his principal — he is bound
and concluded, in the absence of fraud and collusion, by a judgment against his
principal, even though said surety was not a party to the proceeding. In the case of
the De Mendoza vs. Pacheco, 64 Phil. 135, the sureties on the administrator's bond
were held liable thereon altho they were not parties to the proceeding against the
administrator, nor were they notified in connection therewith prior to the issuance of
the court order for the confiscation of the bond. Lastly, according to Section 11, Rule
86 of the Rules of Court, upon the settlement of the account of an executor or
administrator, his sureties "may upon application, be admitted as a party to such
accounting." The import of this provision is that the sureties are not entitled to notice
but may be allowed to intervene in the settlement of the accounts of the executor or
administrator if they ask for leave to do so in due time.

WHEREFORE, the decision appealed from is hereby affirmed, with costs.

Bengzon, C.J., Padilla, Bautista Angelo, Labrador, Concepcion, Reyes, J.B.L., Paredes,
De Leon and Natividad, JJ., concur.
Barrera, J., took no part.
G.R. No. 174873 August 26, 2008
QUASHA ANCHETA PEÑA AND NOLASCO LAW OFFICE FOR ITS OWN BEHALF, AND
REPRESENTING THE HEIRS OF RAYMOND TRIVIERE, petitioners,
vs.
LCN CONSTRUCTION CORP., respondent.
DECISION
CHICO-NAZARIO, J.:
This is a Petition for Review under Rule 45 of the Revised Rules of Court with
petitioners Quasha Ancheta Peña and Nolasco Law Office (Quasha Law Office) and the
Heirs of Raymond Triviere praying for the reversal of the Decision1 dated 11 May 2006
and Resolution2 dated 22 September 2006 of the Court of Appeals granting in part the
Petition for Certiorari filed by respondent LCN Construction Corporation (LCN) in CA-
G.R. SP No. 81296.
The factual antecedents of the case are as follows:
Raymond Triviere passed away on 14 December 1987. On 13 January 1988,
proceedings for the settlement of his intestate estate were instituted by his widow,
Amy Consuelo Triviere, before the Regional Trial Court (RTC) of Makati City, Branch 63
of the National Capital Region (NCR), docketed as Special Proceedings Case No. M-
1678. Atty. Enrique P. Syquia (Syquia) and Atty. William H. Quasha (Quasha) of the
Quasha Law Office, representing the widow and children of the late Raymond Triviere,
respectively, were appointed administrators of the estate of the deceased in April
1988. As administrators, Atty. Syquia and Atty. Quasha incurred expenses for the
payment of real estate taxes, security services, and the preservation and
administration of the estate, as well as litigation expenses.
In February 1995, Atty. Syquia and Atty. Quasha filed before the RTC a Motion for
Payment of their litigation expenses. Citing their failure to submit an accounting of the
assets and liabilities of the estate under administration, the RTC denied in May 1995
the Motion for Payment of Atty. Syquia and Atty. Quasha.
In 1996, Atty. Quasha also passed away. Atty. Redentor Zapata (Zapata), also of the
Quasha Law Office, took over as the counsel of the Triviere children, and continued to
help Atty. Syquia in the settlement of the estate.
On 6 September 2002, Atty. Syquia and Atty. Zapata filed another Motion for
Payment,3 for their own behalf and for their respective clients, presenting the
following allegations:
(1) That the instant Petition was filed on January 13, 1988; and Atty. Enrique
P. Syquia was appointed Administrator by the Order of this Honorable Court
dated April 12, 1988, and discharged his duties starting April 22, 1988, after
properly posting his administrator's bond up to this date, or more than
fourteen (14) years later. Previously, there was the co-administrator Atty.
William H. Quasha, but he has already passed away.
(2) That, together with Co-administrator Atty. William H. Quasha, they have
performed diligently and conscientiously their duties as Co-administrators,
having paid the required Estate tax and settled the various claims against the
Estate, totaling approximately twenty (20) claims, and the only remaining
claim is the unmeritorious claim of LCN Construction Corp., now pending
before this Honorable Court;
(3) That for all their work since April 22, 1988, up to July 1992, or for four (4)
years, they were only given the amount of P20,000.00 each on November 28,
1988; and another P50,00.00 each on October 1991; and the amount of
P100,000.00 each on July 1992; or a total of P170,000.00 to cover their
administration fees, counsel fees and expenses;
(4) That through their work, they were able to settle all the testate (sic) claims
except the remaining baseless claim of LCN Construction Corp., and were
able to dismiss two (2) foreign claims, and were also able to increase the
monetary value of the estate from roughly over P1Million to the present
P4,738,558.63 as of August 25, 2002 and maturing on September 27, 2002;
and the money has always been with the Philippine National Bank, as per the
Order of this Honorable Court;
(5) That since July 1992, when the co-administrators were paid P100,000.00
each, nothing has been paid to either Administrator Syquia or his client, the
widow Consuelo Triviere; nor to the Quasha Law Offices or their clients, the
children of the deceased Raymond Triviere;
(6) That as this Honorable Court will notice, Administrator Syquia has always
been present during the hearings held for the many years of this case; and
the Quasha Law Offices has always been represented by its counsel, Atty.
Redentor C. Zapata; and after all these years, their clients have not been
given a part of their share in the estate;
 (7) That Administrator Syquia, who is a lawyer, is entitled to additional
Administrator's fees since, as provided in Section 7, Rule 85 of the Revised
Rules of Court:
"x x x where the estate is large, and the settlement has been
attended with great difficulty, and has required a high degree of
capacity on the part of the executor or administrator, a greater sum
may be allowed…"
In addition, Atty. Zapata has also been present in all the years of this case. In
addition, they have spent for all the costs of litigation especially the
transcripts, as out-of-pocket expenses.
(8) That considering all the foregoing, especially the fact that neither the
Administrator or his client, the widow; and the Quasha Law Offices or their
clients, the children of the deceased, have received any money for more than
ten (10) years now, they respectfully move that the amount of P1Million be
taken from the Estate funds, to be divided as follows:
a) P450,000.00 as share of the children of the deceased [Triviere]
who are represented by the Quasha Ancheta Peña & Nolasco Law
Offices;
b) P200,000.00 as attorney's fees and litigation expenses for the
Quasha Ancheta Peña & Nolasco Law Offices;
c) P150,000.00 as share for the widow of the deceased [Raymond
Triviere], Amy Consuelo Triviere; and
d) P200,000.00 for the administrator Syquia, who is also the counsel
of the widow; and for litigation costs and expenses.
LCN, as the only remaining claimant4 against the Intestate Estate of the Late Raymond
Triviere in Special Proceedings Case No. M-1678, filed its Comment on/Opposition to
the afore-quoted Motion on 2 October 2002. LCN countered that the RTC had already
resolved the issue of payment of litigation expenses when it denied the first Motion
for Payment filed by Atty. Syquia and Atty. Quasha for failure of the administrators to
submit an accounting of the assets and expenses of the estate as required by the
court. LCN also averred that the administrators and the heirs of the late Raymond
Triviere had earlier agreed to fix the former's fees at only 5% of the gross estate, based
on which, per the computation of LCN, the administrators were even overpaid
P55,000.00. LCN further asserted that contrary to what was stated in the second
Motion for Payment, Section 7, Rule 85 of the Revised Rules of Court was
inapplicable,5 since the administrators failed to establish that the estate was large, or
that its settlement was attended with great difficulty, or required a high degree of
capacity on the part of the administrators. Finally, LCN argued that its claims are still
outstanding and chargeable against the estate of the late Raymond Triviere; thus, no
distribution should be allowed until they have been paid; especially considering that
as of 25 August 2002, the claim of LCN against the estate of the late Raymond Triviere
amounted to P6,016,570.65 as against the remaining assets of the estate totaling
P4,738,558.63, rendering the latter insolvent.
On 12 June 2003, the RTC issued its Order6 taking note that "the widow and the heirs
of the deceased Triviere, after all the years, have not received their respective share
(sic) in the Estate x x x."
The RTC declared that there was no more need for accounting of the assets and
liabilities of the estate considering that:
[T]here appears to be no need for an accounting as the estate has no more
assets except the money deposited with the Union Bank of the Philippines
under Savings Account No. 12097-000656-0 x x x; on the estate taxes, records
shows (sic) that the BIR Revenue Region No. 4-B2 Makati had issued a
certificate dated April 27, 1988 indicating that the estate taxes has been fully
paid.7
As to the payment of fees of Atty. Syquia and the Quasha Law Office, the RTC found
as follows:
[B]oth the Co-Administrator and counsel for the deceased (sic) are entitled
to the payment for the services they have rendered and accomplished for the
estate and the heirs of the deceased as they have over a decade now spent
so much time, labor and skill to accomplish the task assigned to them; and
the last time the administrators obtained their fees was in 1992.8
Hence, the RTC granted the second Motion for Payment; however, it reduced the
sums to be paid, to wit:
In view of the foregoing considerations, the instant motion is hereby
GRANTED. The sums to be paid to the co-administrator and counsel for the
heirs of the deceased Triviere are however reduced.
Accordingly, the co-administrator Atty. Syquia and aforenamed counsel are
authorized to pay to be sourced from the Estate of the deceased as follows:
 a) P450,000.00 as share of the children of the deceased who are represented
by the Quasha, Ancheta, Pena, Nolasco Law Offices;
b) P100,000.00 as attorney's fees and litigation expenses for said law firm;
c) P150,000.00 as share for the widow of the deceased Amy Consuelo
Triviere; and
d) P100,000.00 for the Co-administrator Atty. Enrique P. Syquia and for
litigation costs and expenses.9
LCN filed a Motion for Reconsideration10 of the foregoing Order on 2 July 2003, but it
was denied by the RTC on 29 October 2003.11
On 13 May 2004, LCN sought recourse from the Court of Appeals by assailing in CA-
G.R. SP No. 81296, a Petition for Certiorari, the RTC Orders dated 12 June 2003 and 2
July 2003, for having been rendered with grave abuse of discretion.12 LCN maintained
that:
(1) The administrator's claim for attorney's fees, aside from being prohibited
under paragraph 3, Section 7 of Rule 85 is, together with administration and
litigation expenses, in the nature of a claim against the estate which should
be ventilated and resolved pursuant to Section 8 of Rule 86;
(2) The awards violate Section 1, Rule 90 of the Rules of Court, as there still
exists its (LCN's) unpaid claim in the sum of P6,016,570.65; and
(3) The alleged deliberate failure of the co-administrators to submit an
accounting of the assets and liabilities of the estate does not warrant the
Court's favorable action on the motion for payment. 13
On 11 May 2006, the Court of Appeals promulgated a Decision essentially ruling in
favor of LCN.
While the Court of Appeals conceded that Atty. Syquia and the Quasha Law Office, as
the administrators of the estate of the late Raymond Triviere, were entitled to
administrator's fees and litigation expenses, they could not claim the same from the
funds of the estate. Referring to Section 7, Rule 85 of the Revised Rules of Court, the
appellate court reasoned that the award of expenses and fees in favor of executors
and administrators is subject to the qualification that where the executor or
administrator is a lawyer, he shall not charge against the estate any professional fees
for legal services rendered by him. Instead, the Court of Appeals held that the
attorney's fees due Atty. Syquia and the Quasha Law Offices should be borne by their
clients, the widow and children of the late Raymond Triviere, respectively.
The appellate court likewise revoked the P450,000.00 share and P150,000.00 share
awarded by the RTC to the children and widow of the late Raymond Triviere,
respectively, on the basis that Section 1, Rule 91 of the Revised Rules of Court
proscribes the distribution of the residue of the estate until all its obligations have
been paid.
The appellate court, however, did not agree in the position of LCN that the
administrators' claims against the estate should have been presented and resolved in
accordance with Section 8 of Rule 86 of the Revised Rules of Court. Claims against the
estate that require presentation under Rule 86 refer to "debts or demands of a
pecuniary nature which could have been enforced against the decedent during his
lifetime and which could have been reduced to simple judgment and among which are
those founded on contracts." The Court of Appeals also found the failure of the
administrators to render an accounting excusable on the basis of Section 8, Rule 85 of
the Revised Rules of Court.14
Finding the Petition for Certiorari of LCN partly meritorious, the Court of Appeals
decreed:
WHEREFORE, premises considered, the instant petition is hereby PARTLY
GRANTED. The assailed Orders of the public respondent are hereby
AFFIRMED with MODIFICATION in that -
(1) the shares awarded to the heirs of the deceased Triviere in the assailed
Order of June 12, 2003 are hereby DELETED; and
(2) the attorney's fees awarded in favor of the co-administrators are hereby
DELETED. However, inasmuch as the assailed order fails to itemize these fees
from the litigation fees/administrator's fees awarded in favor of the co-
administrators, public respondent is hereby directed to determine with
particularity the fees pertaining to each administrator.15
Petitioner filed a Motion for Reconsideration16 of the 11 May 2006 Decision of the
Court of Appeals. The Motion, however, was denied by the appellate court in a
Resolution dated 22 September 2006,17 explaining that:
In sum, private respondents did not earlier dispute [herein respondent LCN's]
claim in its petition that the law firm and its lawyers served as co-
administrators of the estate of the late Triviere. It is thus quite absurd for the
 said law firm to now dispute in the motion for reconsideration its being a co-
administrator of the estate.
[Herein petitioners], through counsel, likewise appear to be adopting in their
motion for reconsideration a stance conflicting with their earlier theory
submitted to this Court. Notably, the memorandum for [petitioner] heirs
states that the claim for attorney's fees is supported by the facts and law. To
support such allegation, they contend that Section 7 (3) of Rule 85 of the
1997 Rules of Civil Procedure finds no application to the instant case since
"what is being charged are not professional fees for legal services rendered
but payment for administration of the Estate which has been under the care
and management of the co-administrators for the past fourteen (14) years."
Their allegation, therefore, in their motion for reconsideration that Section 7
(3) of Rule 85 is inapplicable to the case of Quasha Law Offices because it is
"merely seeking payment for legal services rendered to the estate and for
litigation expenses" deserves scant consideration.
xxxx
WHEREFORE, premises considered, private respondents' motion for
reconsideration is hereby DENIED for lack of merit. 18
Exhausting all available legal remedies, petitioners filed the present Petition for
Review on Certiorari based on the following assignment of errors:
I.
THE HONORABLE COURT OF APPEALS ERRED IN RULING THAT THE AWARD
IN FAVOR OF THE HEIRS OF THE LATE RAYMOND TRIVIERE IS ALREADY A
DISTRIBUTION OF THE RESIDUE OF THE ESTATE.
II.
THE HONORABLE COURT OF APPEALS ERRED IN NULLIFYING THE AWARD OF
ATTORNEY'S FEES IN FAVOR OF THE CO-ADMINISTRATORS
I
The Court of Appeals modified the 12 June 2003 Order of the RTC by deleting the
awards of P450,000.00 and P150,000.00 in favor of the children and widow of the late
Raymond Triviere, respectively. The appellate court adopted the position of LCN that
the claim of LCN was an obligation of the estate which was yet unpaid and, under
Section 1, Rule 90 of the Revised Rules of Court, barred the distribution of the residue
of the estate.
Petitioners, though, insist that the awards in favor of the petitioner children and
widow of the late Raymond Triviere is not a distribution of the residue of the estate,
thus, rendering Section 1, Rule 90 of the Revised Rules of Court inapplicable.
Section 1, Rule 90 of the Revised Rules of Court provides:
Section 1. When order for distribution of residue made. - When the debts,
funeral charges, and expenses of administration, the allowance to the widow,
and inheritance tax, if any, chargeable to the estate in accordance with law,
have been paid, the court, on the application of the executor or
administrator, or of a person interested in the estate, and after hearing upon
notice, shall assign the residue of the estate to the persons entitled to the
same, naming them and the proportions, or parts, to which each is entitled,
and such persons may demand and recover their respective shares from the
executor or administrator, or any other person having the same in his
possession. If there is a controversy before the court as to who are the lawful
heirs of the deceased person or as to the distributive shares to which each
person is entitled under the law, the controversy shall be heard and decided
as in ordinary cases.
No distribution shall be allowed until the payment of the obligations above
mentioned has been made or provided for, unless the distributees, or any of
them, give a bond, in a sum to be fixed by the court, conditioned for the
payment of said obligations within such time as the court directs.
According to petitioners, the 12 June 2003 Order of the RTC should not be construed
as a final order of distribution. The 12 June 2003 RTC Order granting the second
Motion for Payment is a mere interlocutory order that does not end the estate
proceedings. Only an order of distribution directing the delivery of the residue of the
estate to the proper distributees brings the intestate proceedings to a close and,
consequently, puts an end to the administration and relieves the administrator of his
duties.
A perusal of the 12 June 2003 RTC Order would immediately reveal that it was not yet
distributing the residue of the estate. The said Order grants the payment of certain
amounts from the funds of the estate to the petitioner children and widow of the late
Raymond Triviere considering that they have not received their respective shares
therefrom for more than a decade. Out of the reported P4,738,558.63 value of the
estate, the petitioner children and widow were being awarded by the RTC, in its 12
June 2003 Order, their shares in the collective amount of P600,000.00. Evidently, the
remaining portion of the estate still needs to be settled. The intestate proceedings
were not yet concluded, and the RTC still had to hear and rule on the pending claim
of LCN against the estate of the late Raymond Triviere and only thereafter can it
distribute the residue of the estate, if any, to his heirs.
While the awards in favor of petitioner children and widow made in the RTC Order
dated 12 June 2003 was not yet a distribution of the residue of the estate, given that
there was still a pending claim against the estate, still, they did constitute a partial and
advance distribution of the estate. Virtually, the petitioner children and widow were
already being awarded shares in the estate, although not all of its obligations had been
paid or provided for.
Section 2, Rule 109 of the Revised Rules of Court expressly recognizes advance
distribution of the estate, thus:
Section 2. Advance distribution in special proceedings. - Notwithstanding a
pending controversy or appeal in proceedings to settle the estate of a
decedent, the court may, in its discretion and upon such terms as it may deem
proper and just, permit that such part of the estate as may not be affected by
the controversy or appeal be distributed among the heirs or legatees, upon
compliance with the conditions set forth in Rule 90 of these rules. (Emphases
supplied.)
The second paragraph of Section 1 of Rule 90 of the Revised Rules of Court allows the
distribution of the estate prior to the payment of the obligations mentioned therein,
provided that "the distributees, or any of them, gives a bond, in a sum to be fixed by
the court, conditioned for the payment of said obligations within such time as the
court directs."
In sum, although it is within the discretion of the RTC whether or not to permit the
advance distribution of the estate, its exercise of such discretion should be qualified
by the following: [1] only part of the estate that is not affected by any pending
controversy or appeal may be the subject of advance distribution (Section 2, Rule 109);
and [2] the distributees must post a bond, fixed by the court, conditioned for the
payment of outstanding obligations of the estate (second paragraph of Section 1, Rule
90). There is no showing that the RTC, in awarding to the petitioner children and
widow their shares in the estate prior to the settlement of all its obligations, complied
with these two requirements or, at the very least, took the same into consideration.
Its Order of 12 June 2003 is completely silent on these matters. It justified its grant of
the award in a single sentence which stated that petitioner children and widow had
not yet received their respective shares from the estate after all these years. Taking
into account that the claim of LCN against the estate of the late Raymond Triviere
allegedly amounted to P6,016,570.65, already in excess of the P4,738,558.63 reported
total value of the estate, the RTC should have been more prudent in approving the
advance distribution of the same.
Petitioners earlier invoked Dael v. Intermediate Appellate Court,,19 where the Court
sustained an Order granting partial distribution of an estate.
However, Dael is not even on all fours with the case at bar, given that the Court therein
found that:
Where, however, the estate has sufficient assets to ensure equitable
distribution of the inheritance in accordance with law and the final judgment
in the proceedings and it does not appear there are unpaid obligations, as
contemplated in Rule 90, for which provisions should have been made or a
bond required, such partial distribution may be allowed. (Emphasis supplied.)
No similar determination on sufficiency of assets or absence of any outstanding
obligations of the estate of the late Raymond Triviere was made by the RTC in this
case. In fact, there is a pending claim by LCN against the estate, and the amount
thereof exceeds the value of the entire estate.
Furthermore, in Dael, the Court actually cautioned that partial distribution of the
decedent's estate pending final termination of the testate or intestate proceeding
should as much as possible be discouraged by the courts, and, except in extreme
cases, such form of advances of inheritance should not be countenanced. The reason
for this rule is that courts should guard with utmost zeal and jealousy the estate of the
decedent to the end that the creditors thereof be adequately protected and all the
rightful heirs be assured of their shares in the inheritance.
Hence, the Court does not find that the Court of Appeals erred in disallowing the
advance award of shares by the RTC to petitioner children and the widow of the late
Raymond Triviere.
II
On the second assignment of error, petitioner Quasha Law Office contends that it is
entitled to the award of attorney's fees and that the third paragraph of Section 7, Rule
85 of the Revised Rules of Court, which reads:
Section 7. What expenses and fees allowed executor or administrator. Not to
charge for services as attorney. Compensation provided by will controls
unless renounced. x x x.
 xxxx
When the executor or administrator is an attorney, he shall not charge
against the estate any professional fees for legal services rendered by him.
(Emphasis supplied.)
is inapplicable to it. The afore-quoted provision is clear and unequivocal and needs no
statutory construction. Here, in attempting to exempt itself from the coverage of said
rule, the Quasha Law Office presents conflicting arguments to justify its claim for
attorney's fees against the estate. At one point, it alleges that the award of attorney's
fees was payment for its administration of the estate of the late Raymond Triviere;
yet, it would later renounce that it was an administrator.
In the pleadings filed by the Quasha Law Office before the Court of Appeals, it referred
to itself as co-administrator of the estate.
In the Comment submitted to the appellate court by Atty. Doronila, the member-
lawyer then assigned by the Quasha Law Office to the case, it stated that:
The 12 June 2003 Order granted the Motion for Payment filed by Co-
Administrator and counsel Atty. Enrique P. Syquia and the counsel Atty. Cirilo
E. Doronila and Co-Administrator for the children of the late Raymond
Triviere. x x x.20 (Emphasis supplied.)
It would again in the same pleading claim to be the "co-administrator and counsel for
the heirs of the late Raymond Triviere."21
Finally, the Memorandum it submitted to the Court of Appeals on behalf of its clients,
the petitioner-children of the late Raymond Triviere, the Quasha Law Office alleged
that:
2. The petition assails the Order of the Honorable Regional Trial Court of
Makati, Branch 63 granting the Motion for Payment filed by Co-
Administrators Atty. Enrique P. Syquia and the undersigned counsel together
with the children of the deceased Raymond Triviere, and the Order dated 29
October 2003 denying Petitioner's Motion for Reconsideration of the First
Order.
xxxx
I. Statement of Antecedent Facts
xxxx
4. On 13 May 2004, Atty. Enrique Syquia, co-administrator and counsel for
respondent Amy Consuelo Triviere and the undersigned counsel, co-
administrator and counsel for the children of the late Raymond Triviere filed
their Comment.22
Petitioner Quasha Law Office asserts that it is not within the purview of Section 7, Rule
85 of the Revised Rules of Court since it is not an appointed administrator of the
estate.23 When Atty. Quasha passed away in 1996, Atty. Syquia was left as the sole
administrator of the estate of the late Raymond Triviere. The person of Atty. Quasha
was distinct from that of petitioner Quasha Law Office; and the appointment of Atty.
Quasha as administrator of the estate did not extend to his law office. Neither could
petitioner Quasha Law Office be deemed to have substituted Atty. Quasha as
administrator upon the latter's death for the same would be in violation of the rules
on the appointment and substitution of estate administrators, particularly, Section 2,
Rule 82 of the Revised Rules of Court.24 Hence, when Atty. Quasha died, petitioner
Quasha Law Office merely helped in the settlement of the estate as counsel for the
petitioner children of the late Raymond Triviere.
In its Memorandum before this Court, however, petitioner Quasha Law Office argues
that "what is being charged are not professional fees for legal services rendered but
payment for administration of the Estate which has been under the care and
management of the co-administrators for the past fourteen (14) years."25
On the other hand, in the Motion for Payment filed with the RTC on 3 September 2002,
petitioner Quasha Law Office prayed for P200,000.00 as "attorney's fees and litigation
expenses." Being lumped together, and absent evidence to the contrary, the
P200,000.00 for attorney's fees and litigation expenses prayed for by the petitioner
Quasha Law Office can be logically and reasonably presumed to be in connection with
cases handled by said law office on behalf of the estate. Simply, petitioner Quasha Law
Office is seeking attorney's fees as compensation for the legal services it rendered in
these cases, as well as reimbursement of the litigation expenses it incurred therein.
The Court notes with disfavor the sudden change in the theory by petitioner Quasha
Law Office. Consistent with discussions in the preceding paragraphs, Quasha Law
Office initially asserted itself as co-administrator of the estate before the courts. The
records do not belie this fact. Petitioner Quasha Law Office later on denied it was
substituted in the place of Atty. Quasha as administrator of the estate only upon filing
a Motion for Reconsideration with the Court of Appeals, and then again before this
Court. As a general rule, a party cannot change his theory of the case or his cause of
action on appeal.26 When a party adopts a certain theory in the court below, he will
not be permitted to change his theory on appeal, for to permit him to do so would not
only be unfair to the other party but it would also be offensive to the basic rules of fair
play, justice and due process.27 Points of law, theories, issues and arguments not
brought to the attention of the lower court need not be, and ordinarily will not be,
considered by a reviewing court, as these cannot be raised for the first time at such
late stage.28
This rule, however, admits of certain exceptions.29 In the interest of justice and within
the sound discretion of the appellate court, a party may change his legal theory on
appeal, only when the factual bases thereof would not require presentation of any
further evidence by the adverse party in order to enable it to properly meet the issue
raised in the new theory.30
On the foregoing considerations, this Court finds it necessary to exercise leniency on
the rule against changing of theory on appeal, consistent with the rules of fair play and
in the interest of justice. Petitioner Quasha Law Office presented conflicting
arguments with respect to whether or not it was co-administrator of the estate.
Nothing in the records, however, reveals that any one of the lawyers of Quasha Law
Office was indeed a substitute administrator for Atty. Quasha upon his death.
The court has jurisdiction to appoint an administrator of an estate by granting letters
of administration to a person not otherwise disqualified or incompetent to serve as
such, following the procedure laid down in Section 6, Rule 78 of the Rules of Court.
Corollary thereto, Section 2, Rule 82 of the Rules of Court provides in clear and
unequivocal terms the modes for replacing an administrator of an estate upon the
death of an administrator, to wit:
Section 2. Court may remove or accept resignation of executor or
administrator. Proceedings upon death, resignation, or removal. x x x.
When an executor or administrator dies, resigns, or is removed the remaining
executor or administrator may administer the trust alone, unless the court
grants letters to someone to act with him. If there is no remaining executor or
administrator, administration may be granted to any suitable person.
The records of the case are wanting in evidence that Quasha Law Office or any of its
lawyers substituted Atty. Quasha as co-administrator of the estate. None of the
documents attached pertain to the issuance of letters of administration to petitioner
Quasha Law Office or any of its lawyers at any time after the demise of Atty. Quasha
in 1996. This Court is thus inclined to give credence to petitioner's contention that
while it rendered legal services for the settlement of the estate of Raymond Triviere
since the time of Atty. Quasha's death in 1996, it did not serve as co-administrator
thereof, granting that it was never even issued letters of administration.
The attorney's fees, therefore, cannot be covered by the prohibition in the
third paragraph of Section 7, Rule 85 of the Revised Rules of Court against an
attorney, to charge against the estate professional fees for legal services
rendered by them.
However, while petitioner Quasha Law Office, serving as counsel of the Triviere
children from the time of death of Atty. Quasha in 1996, is entitled to attorney's fees
and litigation expenses of P100,000.00 as prayed for in the Motion for Payment dated
3 September 2002, and as awarded by the RTC in its 12 June 2003 Order, the same
may be collected from the shares of the Triviere children, upon final distribution of
the estate, in consideration of the fact that the Quasha Law Office, indeed, served as
counsel (not anymore as co-administrator), representing and performing legal
services for the Triviere children in the settlement of the estate of their deceased
father.
Finally, LCN prays that as the contractor of the house (which the decedent caused to
be built and is now part of the estate) with a preferred claim thereon, it should already
be awarded P2,500,000.00, representing one half (1/2) of the proceeds from the sale
of said house. The Court shall not take cognizance of and rule on the matter
considering that, precisely, the merits of the claim of LCN against the estate are still
pending the proper determination by the RTC in the intestate proceedings below.
WHEREFORE, premises considered, the Petition for Review on Certiorari is hereby
PARTLY GRANTED. The Decision dated 11 May 2006 and Resolution dated 22
September 2006 of the Court of Appeals in CA-G.R. SP No. 81296 are AFFIRMED, with
the following MODIFICATIONS:
1) Petitioner Quasha Law Office is entitled to attorney's fees of ONE
HUNDRED THOUSAND PESOS (P100,000.00), for legal services rendered for
the Triviere children in the settlement of the estate of their deceased father,
the same to be paid by the Triviere children in the manner herein discussed;
and
2) Attorneys Enrique P. Syquia and William H. Quasha are entitled to the
payment of their corresponding administrators' fees, to be determined by
the RTC handling Special Proceedings Case No. M-1678, Branch 63 of the
Makati RTC, the same to be chargeable to the estate of Raymond Trieviere.
SO ORDERED.
G.R. No. L-9271 March 29, 1957
In the matter of the testate estate of the late DA. MARGARITA DAVID. CARLOS MORAN
SISON, Judicial Administrator, petitioner-appellant,
vs.
NARCISA F. TEODORO, heiress, oppositor-appellee.
Teodoro R. Dominguez for appellant.
Manuel O. Chan for appellee.
BAUTISTA ANGELO, J.:
On December 20, 1948, the Court of First Instance of Manila, which has jurisdiction
over the estate of the late Margarita David, issued an order appointing Carlos Moran
Sison as judicial administrator, without compensation, after filing a bond in the
amount of P5,000. The next day, Carlos Moran Sison took his oath of office and put up
the requisite bond which was duly approved by the court. On the same day, letters of
administration were issued to him.
On January 19, 1955, the judicial administrator filed an accounting of his
administration which contains, among others, the following disbursement items:
13. Paid to Visayan Surety & Insurance Corporation on August 6, 1954, as renewal
premiums on the Administrator's bond of Judicial Administrator Carlos Moran
Sison covering the period from December 20, 1949 to December 20, 1954,
inclusive .................................
15. Paid to Visayan Surety & Insurance Corporation on December 21, 1954, for
premiums due on the Administrator's bond of judicial Administrator Carlos Moran
Sison for the period from December 21, 1954 to December 21, 1955
...............................................................
Narcisa F. Teodoro, one of the heirs, objected to the approval of the above- quoted
items on the grounds that they are not necessary expenses of administration and
should not be charged against the estate. On February 25, 1955, the court approved
the report of the administrator but disallowed the items objected to on the ground
that they cannot be considered as expenses of administration. The administrator filed
a motion for reconsideration and when the same was denied, he took the present
appeal.
The only issue to be determined is "whether a judicial administrator, serving without
compensation, is entitled to charge as an expense of administration the premiums
paid on his bond."
The lower court did not consider the premiums paid on the bond filed by the
administrator as an expense of administration taking into account undoubtedly the
ruling laid down in the case of Sulit vs. Santos, 56 Phil., 626. That is a case which also
involves the payment of certain premium on the bond put up by the judicial
administrator and when he asked the court that the same be considered as an expense
of administration, it was disapproved for the same reasons advanced by the trial court.
In sustaining this finding, this Court ruled that the "expense incurred by an executor
or administrator to produce a bond is not a proper charge against the estate. Section
680 of the Code of Civil Procedure (similar to section 7, Rule 86) does not authorize
the executor or administrator to charge against the estate the money spent for the
presentation, filing, and substitution of a bond." And elaborating on this matter, the
Court made the following comment:
The aforementioned cases, in reality, seem superfluous in ascertaining the
true principle. The position of an executor or administrator is one of trust. In
fact, the Philippine Code of Civil Procedure so mentions it. It is proper for the
law to safeguard the estate of deceased persons by requiring the executor or
administrator to give a suitable bond. The ability to give this bond is in the
nature of a qualification for the office. The execution and approval of the
bond constitute a condition precedent to acceptance of the responsibilities
of the trust. If an individual does not desire to assume the position of
executor of administrator, he may refuse to do so. On the other hand, when
P380.70 the individual prefers an adequate bond and has it approved by the probate
court, he thereby admits the adequacy of the compensation which is
permitted him pursuant to law. It would be a very far-fetched construction
to deduce the giving of a bond in order to qualify for the office of executor
or administrator is a necessary expense in the care, management, and
76.14
settlement of the estate within the meaning of section 680 of the Code of
Civil Procedure, for these are expenses incurred after the executor of
administrator has met the requirements of the law and has entered upon the
performance of his duties. (See In re Eby's Estate [1894], 30 Atl., 124.)
We feel that the orders of Judge Mapa in this case rested on a fine sense of
official duty, sometimes lacking in cases of this character, to protect the
residue of the estate of a deceased person from unjustifiable inroads by an
executor, and that as these orders conform to the facts and the law, they are
entitled to be fortified by an explicit pronouncement from this court. We rule
that the expense incurred by an execution or administrator to procure a bond
is not a proper charge against the estate, and that section 680 of the Code of
 Civil Procedure does not authorize the executor or administrator to charge
against the estate the money spent for the presentation, filing, and
substitution of a bond.

It is true that the Sulit case may be differentiated from the present in the sense that,
in the former the administrator accepted the trust with the emolument that the law
allows, whereas in the latter the administrator accepted the same without
compensation, but this difference is of no moment, for there is nothing in the decision
that may justify the conclusion that the allowance or disallowance of premiums paid
on the bond of the administrator is made dependent on the receipt of compensation.
On the contrary, a different conclusion may be inferred considering the ratio decidendi
on which the ruling is predicated. Thus, it was there stated that the position of an
executor or administrator is one of trust: that it is proper for the law to safeguard the
estates of deceased persons by requiring the administrator to give a suitable bond,
and that the ability to give this bond is in the nature of a qualification for the office. It
is also intimated therein that "If an individual does not desire to assume the position
of executor or administrator, he may refuse to do so," and it is far-fetched to conclude
that the giving of a bond by an administrator is an necessary expense in the care,
management and settlement of the estate within the meaning of the law, because
these expenses are incurred "after the executor or administrator has met the
requirement of the law and has entered upon the performance of his duties." Of
course, a person may accept the position of executor or administrator with all the
incident appertaining thereto having in mind the compensation which the law allows
for the purpose, but he may waive this compensation in the same manner as he may
refuse to serve without it. Appellant having waived compensation, he cannot now be
heard to complain of the expenses incident to his qualification.

The orders appealed from are hereby affirmed, without costs.

Paras. C.J., Bengzon, Reyes, A., Labrador, Concepcion, Reyes, J.B.L., Endencia and Felix,
JJ., concur.
G.R. No. L-29414 July 17, 1928 the same month, Attorney Felix Wijangco, on behalf of Panis, filed a motion in the
probated proceedings in which be set forth that the minor Bruno Uy Tioco is now
TEODORICO UY TIOCO, petitioner, deceased and that his share of inheritance will go to his father, the herein petitioner;
vs. that the property involved in the case is community property in which one-half
CARLOS IMPERIAL, Judge of First Instance of Manila, and ALEJANDRO M. PANIS, belongs to the petitioner; that consequently the minor Pedro Uy Tioco is only entitled
respondents. to a one-fourth of the property pertaining to the estate, and that therefore his appeal
from the order allowing the attorney's fees can only relate to one-fourth of the
Marcelo Nubla for petitioner. amount allowed, wherefore the movent asked that the administrator be ordered to
The respondent Judge in his own behalf. make payments of three-fourths of the amount within five days from the presentation
Alejandro M. Panis in his own behalf and in behalf of the respondent judge. of the motion. To this motion the guardian ad litem objected, but under the date of
March 6, 1928, the respondent judge ordered the administrator to make payment of
three-fourths of P15,000 within five days. The administrator refused to make such
OSTRAND, J.:
payment, and on March 17th the court, after citing him to show cause, again ordered
him to pay as provided for in the order of March 6, under penalty of removal from
This is a petition for a writ of prohibition to restrain the respondent judge from
office. The present action was thereupon brought. Upon filing the petition the
compelling the petitioner to pay the sum of P11,250 to the other respondent,
respondent were ordered to answer, as ordered, the respondents submitted a
Alejandro Panis, out of the funds of the estate of the deceased Basilisa Yangco, of
demurrer which we, considering that there can be no dispute as to the essential facts,
which estate said petitioner is the administrator.
shall regard as a sufficient answer to said petition.

It appears from the record that the respondent Panis was counsel for the
In our opinion, the petition must be granted. The orders of March 6th and 7th for a
administration of said estate and that he on October 31, 1927, before the final
partial payment of the fees claimed were issued after an appeal had been taken and
settlement of accounts, presented a motion in the probate proceedings for the
perfected by the filing of an appeal bond approved by the court. The appeal was taken
allowance of attorney's fees in the sum of P15,000. On December 5, 1927, the
from the order of February 15 denying the motion for reopening and reconsideration
respondent judge, over the objections in writing presented by the administrator,
of the allowance for attorney's fees and involves the validity of that order and the
granted the motion and allowed the fees claimed by Panis. The administrator, the
finality of the order of December 5, 1927. Whether this orders were valid and final
herein petitioner, did not appeal from the order of the court, but on February 8, 1928,
need not be here determined, but they are appealable, and we are not aware of any
Jacinto Yangco, in his capacity as guardian ad litem of the minors Pedro and Bruno Uy
provision of law authorizing the lower court to enforce the immediate execution of
Tioco, the sons and then the only heirs of the deceased, presented a motion for
such orders and probate proceedings after an appeal has been perfected. The interest
reconsideration under section 113 of the Code of Civil Procedure on the grounds that
of the appellee are supposed to be sufficiently protected by an adequate bond.
he was not notified of the motion for the allowance of fees and had no knowledge
thereof or of the order granting the motion until a few days before the filing of there
The arguments submitted indicate a misconception of the character of the liability for
motion for reconsideration; that the fees allowed Panis were excessive and prejudicial
the attorney's fees are claimed are supposed to have been rendered to the executor
to the interest of the estate; and that considering the nature of the work performed,
or administrator to assist him in the execution of his trust. The attorney can therefore
the services rendered with him did not warrant the payment of the sum claimed. This
not hold the estate directly liable for his fees; such fees are allowed to the executor or
motion was denied on February 15, 1928, the respondent judge holding that while the
administrator and not to the attorney. The liability for the payment rests on the
heirs of the deceased were not notified by the hearing of the motion for allowance of
executor or administrator, but if the fees paid are beneficial to the estate and
attorney's fees, such notice was duly served upon the administrator; that was a
reasonable, he is entitled to the reimbursement from the estate. Such payment should
sufficient compliance with the law; that curador ad litem might have the right to
be included in his accounts and the reimbursement therefore settled upon the notice
intervene in the case but have no absolute right to be notified of the motion; that the
prescribed in section 682 of the Code of Civil Procedure. (See Church on Probate Law
provisions of section 113 of the Code of Civil Procedure were not applicable to the
and Practice, pp. 1570-1588 and authorities there cited; Woerner on the American
case; and that, in any event, the motion for reconsideration is entirely without merit.
Law of Administration, 2d ed., sections 515 and 516.)
On February 23, 1928, the guardian ad litem excepted to the order of February 15,
1928, and gave notice of his intention to appeal to the Supreme Court. On the 28th of
For the reasons stated the respondent judge is hereby prohibited from enforcing the
payment of the attorney's fees above-mentioned until the appeal taken by Jacinto
Yangco, as guardian ad litem for the minor Pedro Uy Tioco, has been passed upon by
this court or dismissed. No costs will be allowed. So ordered.

Avanceña, C.J., Street, Malcolm, Villamor, Romualdez, and Villa-Real, JJ., concur.