HILTON v. GUYOT, 159 U.S.

113 (1895)
159 U.S. 113

HILTON et al.
v.
GUYOT et al. (two cases).

Nos. 130 and 34.

June 3, 1895. [159 U.S. 113, 114] The first of these two cases was an action at law, brought
December 18, 1885, in the circuit court of the United States for the Southern district of New
York, by Gustave Bertin Guyot, as official liquidator of the firm of Charles Fortin & Co., and
by the surviving members of that firm, all aliens and citizens of the republic of France,
against Henry Hilton and William Libbey, citizens of the United States and of the state of
New York, and trading as copartners, in the cities of New York and Paris, and elsewhere,
under the firm name of A. T. Stewart & Co. The action was upon a judgment recovered in a
French court at Paris, in the republic of France, by the firm of Charles Fortin & Co., all of
whose members were French citizens, against Hilton & Libbey, trading as copartners, as
aforesaid, and citizens of the United States and of the state of New York.

The complaint alleged that in 1886, and since, during the time of all the transactions
included in the judgment sued on, Hilton and Libbey, as successors to Alexander T.
Stewart and Libbey, under the firm name of A. T. Stewart & Co., carried on a general
business as merchants in the cities of New York and Paris, and elsewhere, and maintained
a regular store and place of business at Paris; that during the same time Charles Fortin &
Co. carried on the manufacture and sale of gloves at Paris, and the two firms had there
large dealings in that business, and controversies arose in the adjustment of accounts
between them.

The complaint further alleged that between March 1, 1879, and December 1, 1882, five suits
were brought by Fortin & Co. against Stewart & Co. for sums alleged to be due, and three
suits by Stewart & Co. against Fortin & Co., in the tribunal of commerce of the department
of the Seine, a judicial tribunal or court, organized and existing under the laws of France,
sitting at Paris, and having jurisdiction of suits and controversies between merchants or
traders growing [159 U.S. 113, 115] out of commercial dealings between them; that Stewart
& Co. appeared by their authorized attorneys in all those suits; and that, after full hearing
before an arbitrator appointed by that court, and before the court itself, and after all the
suits had been consolidated by the court, final judgment was rendered on January 20,
1883, that Fortin & Co. recover of Stewart & Co. various sums, arising out of the dealings
between them, amounting to 660,847 francs, with interest, and dismissed part of Fortin &
Co.'s claim.

The complaint further alleged that appeals were taken by both parties from that judgment
to the court of appeals of Paris, Third section, an appellate court of record, organized and
existing under the laws of the republic of France, and having jurisdiction of appeals from
the final judgments of the tribunal of commerce of the department of the Seine, where the
amount in dispute exceeded the sum of 1,500 francs; and that the said court of appeal, by a
final judgment, rendered March 19, 1884, and remaining of record in the office of its clerk
at Paris, after hearing the several parties by their counsel, and upon full consideration of
the merits, dismissed the appeal of the defendants, confirmed the judgment of the lower
court in favor of the plaintiffs, and ordered, upon the plaintiffs' appeal, that they recover
the additional sum of 152,528 francs, with 182,849 francs for interest on all the claims
allowed, and 12,559 francs for costs and expenses.

The complaint further alleged that Guyot had been duly appointed by the tribunal of
commerce of the department of the Seine official liquidator of the firm of Forth & Co., with
full powers, according to law and commercial usage, for the verification and realization of
its property, both real and personal, and to collect and cause to be executed the judgments
aforesaid.

The complaint further alleged that the judgment of the court of appeals of Paris, and the
judgment of the tribunal of commerce, as modified by the judgment of the appellate court,
still remain in full force and effect; 'that the said courts respectively had jurisdiction of the
subject-matter of the controversies so submitted to them, and of the parties, the [159 U.S.
113, 116] said defendants having intervened, by their attorneys and counsel, and applied
for affirmative relief in both courts; that the plaintiffs have hitherto been unable to collect
the said judgments or any part thereof, by reason of the absence of the said defendants,
they having given up their business in Paris prior to the recovery of the said judgment on
appeal, and having left no property within the jurisdiction of the republic of France out of
which the said judgments might be made;' and that there are still justly due and owing
from the defendants to the plaintiffs upon those said judgments certain sums, specified in
the complaint, and amounting in all to 1,008,783 francs in the currency of the republic of
France, equivalent to $195,122.47.

The defendants, in their answer, set forth in detail the original contracts and transactions
in France between the parties, and the subsequent dealings between them, modifying those
contracts, and alleged that the plaintiffs had no just claim against the defendants, but that,
no the contrary, the defendants, upon a just settlement of the accounts, were entitled to
recover large sums from the plaintiffs.

The answer admitted the proceedings and judgments in the French courts, and that the
defendants gave up their business in France before the judgment on appeal, and had no
property within the jurisdiction of France out of which that judgment could be collected.

The answer further alleged that the tribunal of commerce of the department of the Seine
was a tribunal whose judges were merchants, ship captains, stockbrokers, and persons
engaged in commercial pursuits, and of which Charles Fortin had been a member until
shortly before the commencement of the litigation.
The answer further alleged that, in the original suits brought against the defendants by
Fortin & Co., the citations were left at their storehouse in Paris; that they were then
residents and citizens of the state of New York, and neither of them at that time, or within
four years before, had been within, or resident or domiciled within, the jurisdiction of that
tribunal, or owed any allegiance to France; but that [159 U.S. 113, 117] they were the
owners of property situated in that country, which would by the law of France have been
liable to seizure if they did not appear in that tribunal; and that they unwillingly, and solely
for the purpose of protecting that property, authorized and caused an agent to appear for
them in those proceedings; and that the suits brought by them against Fortin & Co. were
brought for the same purpose, and in order to make a proper defense, and to establish
counterclaims arising out of the transactions between the parties, and to compel the
production and inspection of Fortin & Co.'s books, and that they sought no other
affirmative relief in that tribunal.

The answer further alleged that pending that litigation the defendants discovered gross
frauds in the accounts of Fourtin & Co., that the arbitrator and the tribunal declined to
compel Fortin & Co. to produce their books and papers for inspection, and that, if they had
been produced, the judgment would not have been obtained against the defendants.

The answer further alleged that, without any fault or negligence on the part of the
defendants, there was not a full and fair trial of the controversies before the arbitrator, in
that no witness was sworn or affirmed; in that Charles Fortin was permitted to make, and
did make, statements not under oath, containing many falsehoods; in that the privilege of
cross-examination of Fortin and other persons, who made statements before the
arbitrator, was denied to the defendants; and in that extracts from printed newspapers,
the knowledge of which was not brought home to the defendants, and letters and other
communications in writing between Fortin & Co. and third persons, to which the
defendants were neither privy nor party, were received by the arbitrator; that without such
improper evidence the judgment would not have been obtained; and that the arbitrator
was deceived and misled by the false and fraudulent accounts introduced by Fortin & Co.,
and by the hearsay testimony given, without the solemnity of an oath, and without cross-
examination, and by the fraudulent suppression of the books and papers.

The answer further alleged that Fortin & Co. made up their statements and accounts falsely
and fraudulently, and with [159 U.S. 113, 118] intent to deceive the defendants and the
arbitrator and the said courts of France, and those courts were deceived and misled
thereby; that, owing to the fraudulent suppression of the books and papers of Fortin & Co.
upon the trial, and the false statements of Fortin regarding matters involved in the
controversy, the arbitrator and the courts of France 'were deceived and misled in regard to
the merits of the controversies pending before them, and wrongfully decided against said
Stewart & Co., as hereinbefore stated; that said judgment, hereinbefore mentioned, is
fraudulent, and based upon false and fraudulent accounts and statements, and is
errorneous in fact and in law, and is void; that the trial hereinbefore mentioned was not
conducted according to the usages and practice of the common law, and the allegations and
proofs given by said Fortin & Co., upon which said judgment is founded, would not be
competent or admissible in any court or tribunal of the United States, in any suit between
the same parties, involving the same subject-matter, and it is contrary to natural justice
and public policy that the said judgment should be enforced against a citizen of the United
States; and that, if there had been a full and fair trial upon the merits of the controversies
so pending before said tribunals, no judgment would have been obtained against said
Stewart & Co.

'Defendants, further answering, allege that it is contrary to natural justice that the
judgment hereinbefore mentioned should be enforced without an examination of the
merits thereof; that by the laws of the republic of France, to wit, article 181 [159 U.S. 113,
121] of the royal ordinance of June 15, 1629, it is provided namely: 'Judgments rendered,
contracts or obligations recognized, in foreign kingdoms and sovereignties, for any cause
whatever, shall give rise to no lien or execution in our kingdom. Thus the contracts shall
stand for simple promises, and, notwithstanding such judgments, our subjects against
whom they have been rendered may contest their rights anew before our own judges.'
'And it is further provided by the laws of France, by article 546 of the Code de Procedure
Civile, as follows: 'Judgments rendered by foreign tribunals shall be capable of execu-[159
U.S. 113, 119] tion in France, only in the manner and in the cases set forth by articles 2123
and 2128 of the Civil Code.'
'And it is further provided by the laws of France, by article 2128 [ 2123] of the Code de
Procedure Civile [Civil Code]: 'A lien cannot, in like manner, arise from judgments
rendered in any foreign country, save only as they have been declared in force by a French
tribunal, without prejudice, however, to provisions to the contrary, contained in public
laws and treaties.' [And by article 2128 of that Code: 'Contracts entered into in a foreign
country cannot give a lien upon property in France, if there are no provisions contrary to
this principle in public laws or in treaties.']
'That the construction given to said statutes by the judicial tribunals of France is such that
no comity is displayed towards the judgments of tribunals of foreign countries against the
citizens of France, when sued upon in said courts of France, and the merits of the
controversies upon which the said judgments are based are examined anew, unless a treaty
to the contrary effect exists between the said republic of France and the country in which
such judgment is obtained. That no treaty exists between the said republic of France and
the United States, by the terms or effect of which the judgments of either country are
prevented from being examined anew upon the merits, when sued upon in the courts of the
country other than that in which it is obtained. That the tribunals of the republic of France
give no force and effect, within the jurisdiction of the said country, to the duly rendered
judgments of courts of competent jurisdiction of the United States against citizens of
France, after proper personal service of the process of said courts is made thereon in this
country.'
The answer further set up, by way of counterclaim, and in detail, various matters arising
out of the dealings between the parties, and alleged that none of the plaintiffs had since
1881 been residents of the state of New York, or within the jurisdiction of that state, but the
defendants were, and always had been, residents of that state.

The answer concluded by demanding that the plaintiffs' [159 U.S. 113, 120] complaint be
dismissed, and that the defendants have judgment against them upon the counterclaims,
amounting to $102,942.91.

The plaintiffs filed a replication to so much of the answer as made counterclaims, denying
its allegations, and setting up in bar thereof the judgment sued on.

The defendants, on June 22, 1888, filed a bill in equity against the plaintiffs, setting forth
the same matters as in their answer to the action at law, and praying for a discovery, and
for an injunction against the prosecution of the action. To that bill a plea was filed, setting
up the French judgments, and upon a hearing the bill was dismissed. 42 Fed. 249. From the
decree dismissing the bill an appeal was taken, which is the second case now before this
court.

The action at law afterwards came on for trial by a jury, and the plaintiffs put in the
records of the proceedings and judgments in the French courts, and evidence that the
jurisdiction of those courts was as alleged in the complaint, and that the practice followed,
and the method of examining the witnesses, were according to the French law; and also
proved the title of Guyot as liquidator.

It was admitted by both parties that for several years prior to 1876 the firm of Alexander T.
Stewart & Co., composed of Stewart and Libbey, conducted their business as merchants in
the city of New York, with branches in other cities of America and Europe; that both
partners were citizens and residents of the city and state of New York during the entire
period mentioned in the complaint; and that in April, 1876, Stewart died, and Hilton and
Libbey formed a partnership to continue the business under the same firm name, and
became the owners of all the property and rights of the old firm.

The defendants made numerous offers of evidence in support of all the specific allegations
of fact in their answer, including the allegations as to the law and comity of France. The
plaintiffs, in their brief filed in this court, admitted that most of these offers 'where offers
to prove matters in support of the defenses and counterclaims set up by the defendants in
the cases tried before the French courts, and which, or most [159 U.S. 113, 121] of which,
would have been relevant and competent if the plaintiffs in error are not concluded by the
result of those litigations, and have now the right to try those issues, either on the ground
that the French judgments are only prima facie evidence of the correctness of those
judgments, or on the ground that the case is within the exception of a judgment obtained
by fraud.'

The defendants, in order to show that they should not be concluded by having appeared
and litigated in the suits brought against them by the plaintiffs in the French courts,
offered to prove that they were residents and citizens of the state of New York, and neither
of them had been, within four years prior to the commencement of those suits, domiciled
or resident within the jurisdiction of those courts; that they had a purchasing agent and a
storehouse in Paris, but only as a means or facility to aid in the transaction of their
principal business, which was in New York, and they were never otherwise engaged in
business in France; that neither of them owed allegiance to France, but they were the
owners of property there, which would, according to the laws of France, have been liable to
seizure if they had not appeared to answer in those suits; that they unwillingly, and solely
for the purpose of protecting their property within the jurisdiction of the French tribunal,
authorized an agent to appear, and he did appear in the proceedings before it; and that
their motion to compel an inspection of the plaintiffs' books, as well as the suits brought by
the defendants in France, were necessary by way of defense or counterclaim to the suits
there brought by the plaintiffs against them.

Among the matters which the defendants alleged and offered to prove in order to show that
the French judgments were procured by fraud were that Fortin & Co., with intent to
deceive and defraud the defendants, and the arbitrator and the courts of France, entered in
their books, and presented to the defendants, and to the French courts, accounts bearing
upon the transactions in controversy which were false and fraudulent, and contained
excessive and fraudulent charges against the defendants in various particulars, specified;
that the [159 U.S. 113, 122] defendants made due application to the tribunal of commerce
to compel Fortin & Co. to allow their account books and letter books to be inspected by the
defendants, and the application was opposed by Fortin & Co., and denied by the tribunal;
that the discovery and inspection of those books were necessary to determine the truth of
the controversies between the parties; that before the tribunal of commerce Charles Fortin
was permitted to and did give in evidence statements not under oath, relating to the merits
of the controversies there pending, and falsely represented that a certain written contract,
made in 1873, between Stewart & Co. and Fortin & Co., concerning their dealings, was not
intended by the parties to be operative according to its terms; and in support of that false
representation made statements as to admissions by Stewart in a private conversation with
him; and that the defendants could not deny those statements, because Stewart was dead,
and they were not protected from the effect of Fortin's statements by the privilege of cross-
examining him under oath; and that the French judgments were based upon false and
fraudulent accounts presented and statements made by Fortin & Co. before the tribunal of
commerce during the trial before it.

The records of the judgments of the French courts, put in evidence by the plaintiffs,
showed that all the matters now relied on to show fraud were contested in and considered
by those courts.

The plaintiffs objected to all the evidence offered by the defendants, on the grounds that
the matters offered to be proved were irrelevant, immaterial, and incompetent; that in
respect to them the defendants were concluded by the judgment sued on and given in
evidence; and that none of those matters, if proved, would be a defense to this action upon
that judgment.

The court declined to admit any of the evidence so offered by the defendants, and directed
a verdict for the plaintiffs in the sum of $277, 775.44, being the amount of the French
judgment and interest. The defendants, having duly excepted to the rulings and direction
of the court, sued out a writ of error.

T- [159 U.S. 113, 123] The writ of error in the action at law and the appeal in the suit in
equity were argued together in this court in January, 1894, and, by direction of the court,
were reargued in April, 1894

G.R. No. L-11390 March 26, 1918

EL BANCO ESPAÑOL-FILIPINO, plaintiff-appellant,

vs.
VICENTE PALANCA, administrator of the estate of Engracio Palanca Tanquinyeng, defendant-
appellant.

Aitken and DeSelms for appellant.

Hartigan and Welch for appellee.

STREET, J.:

This action was instituted upon March 31, 1908, by "El Banco Espanol-Filipino" to foreclose a
mortgage upon various parcels of real property situated in the city of Manila. The mortgage in
question is dated June 16, 1906, and was executed by the original defendant herein, Engracio
Palanca Tanquinyeng y Limquingco, as security for a debt owing by him to the bank. Upon March
31, 1906, the debt amounted to P218,294.10 and was drawing interest at the rate of 8 per centum
per annum, payable at the end of each quarter. It appears that the parties to this mortgage at that
time estimated the value of the property in question at P292,558, which was about P75,000 in
excess of the indebtedness. After the execution of this instrument by the mortgagor, he returned to
China which appears to have been his native country; and he there died, upon January 29, 1810,
without again returning to the Philippine Islands.

As the defendant was a nonresident at the time of the institution of the present action, it was
necessary for the plaintiff in the foreclosure proceeding to give notice to the defendant by publication
pursuant to section 399 of the Code of Civil Procedure. An order for publication was accordingly
obtained from the court, and publication was made in due form in a newspaper of the city of Manila.
At the same time that the order of the court should deposit in the post office in a stamped envelope a
copy of the summons and complaint directed to the defendant at his last place of residence, to wit,
the city of Amoy, in the Empire of China. This order was made pursuant to the following provision
contained in section 399 of the Code of Civil Procedure:

In case of publication, where the residence of a nonresident or absent defendant is known,

the judge must direct a copy of the summons and complaint to be forthwith deposited by the
clerk in the post-office, postage prepaid, directed to the person to be served, at his place of
residence
Whether the clerk complied with this order does not affirmatively appear. There is, however, among
the papers pertaining to this case, an affidavit, dated April 4, 1908, signed by Bernardo Chan y
Garcia, an employee of the attorneys of the bank, showing that upon that date he had deposited in
the Manila post-office a registered letter, addressed to Engracio Palanca Tanquinyeng, at Manila,
containing copies of the complaint, the plaintiff's affidavit, the summons, and the order of the court
directing publication as aforesaid. It appears from the postmaster's receipt that Bernardo probably
used an envelope obtained from the clerk's office, as the receipt purports to show that the letter
emanated from the office.

The cause proceeded in usual course in the Court of First Instance; and the defendant not having
appeared, judgment was, upon July 2, 1908, taken against him by default. Upon July 3, 1908, a
decision was rendered in favor of the plaintiff. In this decision it was recited that publication had been
properly made in a periodical, but nothing was said about this notice having been given mail. The
court, upon this occasion, found that the indebtedness of the defendant amounted to P249,355. 32,
with interest from March 31, 1908. Accordingly it was ordered that the defendant should, on or
before July 6, 1908, deliver said amount to the clerk of the court to be applied to the satisfaction of
the judgment, and it was declared that in case of the failure of the defendant to satisfy the judgment
within such period, the mortgage property located in the city of Manila should be exposed to public
sale. The payment contemplated in said order was never made; and upon July 8, 1908, the court
ordered the sale of the property. The sale took place upon July 30, 1908, and the property was
bought in by the bank for the sum of P110,200. Upon August 7, 1908, this sale was confirmed by the
court.

About seven years after the confirmation of this sale, or to the precise, upon June 25, 1915, a motion
was made in this cause by Vicente Palanca, as administrator of the estate of the original defendant,
Engracio Palanca Tanquinyeng y Limquingco, wherein the applicant requested the court to set aside
the order of default of July 2, 1908, and the judgment rendered upon July 3, 1908, and to vacate all
the proceedings subsequent thereto. The basis of this application, as set forth in the motion itself,
was that the order of default and the judgment rendered thereon were void because the court had
never acquired jurisdiction over the defendant or over the subject of the action.

At the hearing in the court below the application to vacate the judgment was denied, and from this
action of the court Vicente Planca, as administrator of the estate of the original defendant, has
appealed. No other feature of the case is here under consideration than such as related to the action
of the court upon said motion.

The case presents several questions of importance, which will be discussed in what appears to be
the sequence of most convenient development. In the first part of this opinion we shall, for the
purpose of argument, assume that the clerk of the Court of First Instance did not obey the order of
the court in the matter of mailing the papers which he was directed to send to the defendant in
Amoy; and in this connection we shall consider, first, whether the court acquired the necessary
jurisdiction to enable it to proceed with the foreclosure of the mortgage and, secondly, whether those
proceedings were conducted in such manner as to constitute due process of law.

The word "jurisdiction," as applied to the faculty of exercising judicial power, is used in several
different, though related, senses since it may have reference (1) to the authority of the court to
entertain a particular kind of action or to administer a particular kind of relief, or it may refer to the
power of the court over the parties, or (2) over the property which is the subject to the litigation.

The sovereign authority which organizes a court determines the nature and extent of its powers in
general and thus fixes its competency or jurisdiction with reference to the actions which it may
entertain and the relief it may grant.
Jurisdiction over the person is acquired by the voluntary appearance of a party in court and his
submission to its authority, or it is acquired by the coercive power of legal process exerted over the
person.

Jurisdiction over the property which is the subject of the litigation may result either from a seizure of
the property under legal process, whereby it is brought into the actual custody of the law, or it may
result from the institution of legal proceedings wherein, under special provisions of law, the power of
the court over the property is recognized and made effective. In the latter case the property, though
at all times within the potential power of the court, may never be taken into actual custody at all. An
illustration of the jurisdiction acquired by actual seizure is found in attachment proceedings, where
the property is seized at the beginning of the action, or some subsequent stage of its progress, and
held to abide the final event of the litigation. An illustration of what we term potential jurisdiction over
the res, is found in the proceeding to register the title of land under our system for the registration of
land. Here the court, without taking actual physical control over the property assumes, at the
instance of some person claiming to be owner, to exercise a jurisdiction in rem over the property and
to adjudicate the title in favor of the petitioner against all the world.

In the terminology of American law the action to foreclose a mortgage is said to be a proceeding
quasi in rem, by which is expressed the idea that while it is not strictly speaking an action in rem yet
it partakes of that nature and is substantially such. The expression "action in rem" is, in its narrow
application, used only with reference to certain proceedings in courts of admiralty wherein the
property alone is treated as responsible for the claim or obligation upon which the proceedings are
based. The action quasi rem differs from the true action in rem in the circumstance that in the former
an individual is named as defendant, and the purpose of the proceeding is to subject his interest
therein to the obligation or lien burdening the property. All proceedings having for their sole object
the sale or other disposition of the property of the defendant, whether by attachment, foreclosure, or
other form of remedy, are in a general way thus designated. The judgment entered in these
proceedings is conclusive only between the parties.

In speaking of the proceeding to foreclose a mortgage the author of a well known treaties, has said:

Though nominally against person, such suits are to vindicate liens; they proceed upon
seizure; they treat property as primarily indebted; and, with the qualification above-
mentioned, they are substantially property actions. In the civil law, they are styled
hypothecary actions, and their sole object is the enforcement of the lien against the res; in
the common law, they would be different in chancery did not treat the conditional
conveyance as a mere hypothecation, and the creditor's right ass an equitable lien; so, in
both, the suit is real action so far as it is against property, and seeks the judicial recognition
of a property debt, and an order for the sale of the res. (Waples, Proceedings In Rem. sec.
607.)

It is true that in proceedings of this character, if the defendant for whom publication is made appears,
the action becomes as to him a personal action and is conducted as such. This, however, does not
affect the proposition that where the defendant fails to appear the action is quasi in rem; and it
should therefore be considered with reference to the principles governing actions in rem.

There is an instructive analogy between the foreclosure proceeding and an action of attachment,
concerning which the Supreme Court of the United States has used the following language:

If the defendant appears, the cause becomes mainly a suit in personam, with the added
incident, that the property attached remains liable, under the control of the court, to answer
to any demand which may be established against the defendant by the final judgment of the
 court. But, if there is no appearance of the defendant, and no service of process on him, the
case becomes, in its essential nature, a proceeding in rem, the only effect of which is to
subject the property attached to the payment of the defendant which the court may find to be
due to the plaintiff. (Cooper vs. Reynolds, 10 Wall., 308.)

In an ordinary attachment proceeding, if the defendant is not personally served, the preliminary
seizure is to, be considered necessary in order to confer jurisdiction upon the court. In this case the
lien on the property is acquired by the seizure; and the purpose of the proceedings is to subject the
property to that lien. If a lien already exists, whether created by mortgage, contract, or statute, the
preliminary seizure is not necessary; and the court proceeds to enforce such lien in the manner
provided by law precisely as though the property had been seized upon attachment. (Roller vs.
Holly, 176 U. S., 398, 405; 44 L. ed., 520.) It results that the mere circumstance that in an
attachment the property may be seized at the inception of the proceedings, while in the foreclosure
suit it is not taken into legal custody until the time comes for the sale, does not materially affect the
fundamental principle involved in both cases, which is that the court is here exercising a jurisdiction
over the property in a proceeding directed essentially in rem.

Passing now to a consideration of the jurisdiction of the Court of First Instance in a mortgage
foreclosure, it is evident that the court derives its authority to entertain the action primarily from the
statutes organizing the court. The jurisdiction of the court, in this most general sense, over the cause
of action is obvious and requires no comment. Jurisdiction over the person of the defendant, if
acquired at all in such an action, is obtained by the voluntary submission of the defendant or by the
personal service of process upon him within the territory where the process is valid. If, however, the
defendant is a nonresident and, remaining beyond the range of the personal process of the court,
refuses to come in voluntarily, the court never acquires jurisdiction over the person at all. Here the
property itself is in fact the sole thing which is impleaded and is the responsible object which is the
subject of the exercise of judicial power. It follows that the jurisdiction of the court in such case is
based exclusively on the power which, under the law, it possesses over the property; and any
discussion relative to the jurisdiction of the court over the person of the defendant is entirely apart
from the case. The jurisdiction of the court over the property, considered as the exclusive object of
such action, is evidently based upon the following conditions and considerations, namely: (1) that the
property is located within the district; (2) that the purpose of the litigation is to subject the property by
sale to an obligation fixed upon it by the mortgage; and (3) that the court at a proper stage of the
proceedings takes the property into custody, if necessary, and expose it to sale for the purpose of
satisfying the mortgage debt. An obvious corollary is that no other relief can be granted in this
proceeding than such as can be enforced against the property.

We may then, from what has been stated, formulated the following proposition relative to the
foreclosure proceeding against the property of a nonresident mortgagor who fails to come in and
submit himself personally to the jurisdiction of the court: (I) That the jurisdiction of the court is
derived from the power which it possesses over the property; (II) that jurisdiction over the person is
not acquired and is nonessential; (III) that the relief granted by the court must be limited to such as
can be enforced against the property itself.

It is important that the bearing of these propositions be clearly apprehended, for there are many
expressions in the American reports from which it might be inferred that the court acquires personal
jurisdiction over the person of the defendant by publication and notice; but such is not the case. In
truth the proposition that jurisdiction over the person of a nonresident cannot be acquired by
publication and notice was never clearly understood even in the American courts until after the
decision had been rendered by the Supreme Court of the United States in the leading case of
Pennoyer vs. Neff (95 U. S. 714; 24 L. ed., 565). In the light of that decision, and of other decisions
which have subsequently been rendered in that and other courts, the proposition that jurisdiction
over the person cannot be thus acquired by publication and notice is no longer open to question; and
it is now fully established that a personal judgment upon constructive or substituted service against a
nonresident who does not appear is wholly invalid. This doctrine applies to all kinds of constructive
or substituted process, including service by publication and personal service outside of the
jurisdiction in which the judgment is rendered; and the only exception seems to be found in the case
where the nonresident defendant has expressly or impliedly consented to the mode of service. (Note
to Raher vs. Raher, 35 L. R. A. [N. S. ], 292; see also 50 L .R. A., 585; 35 L. R. A. [N. S.], 312

The idea upon which the decision in Pennoyer vs. Neff (supra) proceeds is that the process from the
tribunals of one State cannot run into other States or countries and that due process of law requires
that the defendant shall be brought under the power of the court by service of process within the
State, or by his voluntary appearance, in order to authorize the court to pass upon the question of
his personal liability. The doctrine established by the Supreme Court of the United States on this
point, being based upon the constitutional conception of due process of law, is binding upon the
courts of the Philippine Islands. Involved in this decision is the principle that in proceedings in rem or
quasi in rem against a nonresident who is not served personally within the state, and who does not
appear, the relief must be confined to the res, and the court cannot lawfully render a personal
judgment against him. (Dewey vs. Des Moines, 173 U. S., 193; 43 L. ed., 665; Heidritter vs.
Elizabeth Oil Cloth Co., 112 U. S., 294; 28 L. ed., 729.) Therefore in an action to foreclose a
mortgage against a nonresident, upon whom service has been effected exclusively by publication,
no personal judgment for the deficiency can be entered. (Latta vs. Tutton, 122 Cal., 279; Blumberg
vs. Birch, 99 Cal., 416.)

It is suggested in the brief of the appellant that the judgment entered in the court below offends
against the principle just stated and that this judgment is void because the court in fact entered a
personal judgment against the absent debtor for the full amount of the indebtedness secured by the
mortgage. We do not so interpret the judgment.

In a foreclosure proceeding against a nonresident owner it is necessary for the court, as in all cases
of foreclosure, to ascertain the amount due, as prescribed in section 256 of the Code of Civil
Procedure, and to make an order requiring the defendant to pay the money into court. This step is a
necessary precursor of the order of sale. In the present case the judgment which was entered
contains the following words:

Because it is declared that the said defendant Engracio Palanca Tanquinyeng y Limquingco,
is indebted in the amount of P249,355.32, plus the interest, to the 'Banco Espanol-Filipino' . .
. therefore said appellant is ordered to deliver the above amount etc., etc.

This is not the language of a personal judgment. Instead it is clearly intended merely as a
compliance with the requirement that the amount due shall be ascertained and that the evidence of
this it may be observed that according to the Code of Civil Procedure a personal judgment against
the debtor for the deficiency is not to be rendered until after the property has been sold and the
proceeds applied to the mortgage debt. (sec. 260).

The conclusion upon this phase of the case is that whatever may be the effect in other respects of
the failure of the clerk of the Court of First Instance to mail the proper papers to the defendant in
Amoy, China, such irregularity could in no wise impair or defeat the jurisdiction of the court, for in our
opinion that jurisdiction rest upon a basis much more secure than would be supplied by any form of
notice that could be given to a resident of a foreign country.

Before leaving this branch of the case, we wish to observe that we are fully aware that many
reported cases can be cited in which it is assumed that the question of the sufficiency of publication
or notice in a case of this kind is a question affecting the jurisdiction of the court, and the court is
sometimes said to acquire jurisdiction by virtue of the publication. This phraseology was undoubtedly
originally adopted by the court because of the analogy between service by the publication and
personal service of process upon the defendant; and, as has already been suggested, prior to the
decision of Pennoyer vs. Neff (supra) the difference between the legal effects of the two forms of
service was obscure. It is accordingly not surprising that the modes of expression which had already
been molded into legal tradition before that case was decided have been brought down to the
present day. But it is clear that the legal principle here involved is not effected by the peculiar
language in which the courts have expounded their ideas.

We now proceed to a discussion of the question whether the supposed irregularity in the
proceedings was of such gravity as to amount to a denial of that "due process of law" which was
secured by the Act of Congress in force in these Islands at the time this mortgage was foreclosed.
(Act of July 1, 1902, sec. 5.) In dealing with questions involving the application of the constitutional
provisions relating to due process of law the Supreme Court of the United States has refrained from
attempting to define with precision the meaning of that expression, the reason being that the idea
expressed therein is applicable under so many diverse conditions as to make any attempt ay precise
definition hazardous and unprofitable. As applied to a judicial proceeding, however, it may be laid
down with certainty that the requirement of due process is satisfied if the following conditions are
present, namely; (1) There must be a court or tribunal clothed with judicial power to hear and
determine the matter before it; (2) jurisdiction must be lawfully acquired over the person of the
defendant or over the property which is the subject of the proceeding; (3) the defendant must be
given an opportunity to be heard; and (4) judgment must be rendered upon lawful hearing.

Passing at once to the requisite that the defendant shall have an opportunity to be heard, we
observe that in a foreclosure case some notification of the proceedings to the nonresident owner,
prescribing the time within which appearance must be made, is everywhere recognized as essential.
To answer this necessity the statutes generally provide for publication, and usually in addition
thereto, for the mailing of notice to the defendant, if his residence is known. Though commonly
called constructive, or substituted service of process in any true sense. It is merely a means
provided by law whereby the owner may be admonished that his property is the subject of judicial
proceedings and that it is incumbent upon him to take such steps as he sees fit to protect it. In
speaking of notice of this character a distinguish master of constitutional law has used the following
language:

. . . if the owners are named in the proceedings, and personal notice is provided for, it is
rather from tenderness to their interests, and in order to make sure that the opportunity for a
hearing shall not be lost to them, than from any necessity that the case shall assume that
form. (Cooley on Taxation [2d. ed.], 527, quoted in Leigh vs. Green, 193 U. S., 79, 80.)

It will be observed that this mode of notification does not involve any absolute assurance that the
absent owner shall thereby receive actual notice. The periodical containing the publication may
never in fact come to his hands, and the chances that he should discover the notice may often be
very slight. Even where notice is sent by mail the probability of his receiving it, though much
increased, is dependent upon the correctness of the address to which it is forwarded as well as upon
the regularity and security of the mail service. It will be noted, furthermore, that the provision of our
law relative to the mailing of notice does not absolutely require the mailing of notice unconditionally
and in every event, but only in the case where the defendant's residence is known. In the light of all
these facts, it is evident that actual notice to the defendant in cases of this kind is not, under the law,
to be considered absolutely necessary.
The idea upon which the law proceeds in recognizing the efficacy of a means of notification which
may fall short of actual notice is apparently this: Property is always assumed to be in the possession
of its owner, in person or by agent; and he may be safely held, under certain conditions, to be
affected with knowledge that proceedings have been instituted for its condemnation and sale.

It is the duty of the owner of real estate, who is a nonresident, to take measures that in some
way he shall be represented when his property is called into requisition, and if he fails to do
this, and fails to get notice by the ordinary publications which have usually been required in
such cases, it is his misfortune, and he must abide the consequences. (6 R. C. L., sec. 445
[p. 450]).

It has been well said by an American court:

If property of a nonresident cannot be reached by legal process upon the constructive notice,
then our statutes were passed in vain, and are mere empty legislative declarations, without
either force, or meaning; for if the person is not within the jurisdiction of the court, no
personal judgment can be rendered, and if the judgment cannot operate upon the property,
then no effective judgment at all can be rendered, so that the result would be that the courts
would be powerless to assist a citizen against a nonresident. Such a result would be a
deplorable one. (Quarl vs. Abbett, 102 Ind., 233; 52 Am. Rep., 662, 667.)

It is, of course universally recognized that the statutory provisions relative to publication or other
form of notice against a nonresident owner should be complied with; and in respect to the publication
of notice in the newspaper it may be stated that strict compliance with the requirements of the law
has been held to be essential. In Guaranty Trust etc. Co. vs. Green Cove etc., Railroad Co. (139 U.
S., 137, 138), it was held that where newspaper publication was made for 19 weeks, when the
statute required 20, the publication was insufficient.

With respect to the provisions of our own statute, relative to the sending of notice by mail, the
requirement is that the judge shall direct that the notice be deposited in the mail by the clerk of the
court, and it is not in terms declared that the notice must be deposited in the mail. We consider this
to be of some significance; and it seems to us that, having due regard to the principles upon which
the giving of such notice is required, the absent owner of the mortgaged property must, so far as the
due process of law is concerned, take the risk incident to the possible failure of the clerk to perform
his duty, somewhat as he takes the risk that the mail clerk or the mail carrier might possibly lose or
destroy the parcel or envelope containing the notice before it should reach its destination and be
delivered to him. This idea seems to be strengthened by the consideration that placing upon the
clerk the duty of sending notice by mail, the performance of that act is put effectually beyond the
control of the plaintiff in the litigation. At any rate it is obvious that so much of section 399 of the
Code of Civil Procedure as relates to the sending of notice by mail was complied with when the court
made the order. The question as to what may be the consequences of the failure of the record to
show the proof of compliance with that requirement will be discussed by us further on.

The observations which have just been made lead to the conclusion that the failure of the clerk to
mail the notice, if in fact he did so fail in his duty, is not such an irregularity, as amounts to a denial of
due process of law; and hence in our opinion that irregularity, if proved, would not avoid the
judgment in this case. Notice was given by publication in a newspaper and this is the only form of
notice which the law unconditionally requires. This in our opinion is all that was absolutely necessary
to sustain the proceedings.

It will be observed that in considering the effect of this irregularity, it makes a difference whether it be
viewed as a question involving jurisdiction or as a question involving due process of law. In the
matter of jurisdiction there can be no distinction between the much and the little. The court either has
jurisdiction or it has not; and if the requirement as to the mailing of notice should be considered as a
step antecedent to the acquiring of jurisdiction, there could be no escape from the conclusion that
the failure to take that step was fatal to the validity of the judgment. In the application of the idea of
due process of law, on the other hand, it is clearly unnecessary to be so rigorous. The jurisdiction
being once established, all that due process of law thereafter requires is an opportunity for the
defendant to be heard; and as publication was duly made in the newspaper, it would seem highly
unreasonable to hold that failure to mail the notice was fatal. We think that in applying the
requirement of due process of law, it is permissible to reflect upon the purposes of the provision
which is supposed to have been violated and the principle underlying the exercise of judicial power
in these proceedings. Judge in the light of these conceptions, we think that the provision of Act of
Congress declaring that no person shall be deprived of his property without due process of law has
not been infringed.

In the progress of this discussion we have stated the two conclusions; (1) that the failure of the clerk
to send the notice to the defendant by mail did not destroy the jurisdiction of the court and (2) that
such irregularity did not infringe the requirement of due process of law. As a consequence of these
conclusions the irregularity in question is in some measure shorn of its potency. It is still necessary,
however, to consider its effect considered as a simple irregularity of procedure; and it would be idle
to pretend that even in this aspect the irregularity is not grave enough. From this point of view,
however, it is obvious that any motion to vacate the judgment on the ground of the irregularity in
question must fail unless it shows that the defendant was prejudiced by that irregularity. The least,
therefore, that can be required of the proponent of such a motion is to show that he had a good
defense against the action to foreclose the mortgage. Nothing of the kind is, however, shown either
in the motion or in the affidavit which accompanies the motion.

An application to open or vacate a judgment because of an irregularity or defect in the proceedings

is usually required to be supported by an affidavit showing the grounds on which the relief is sought,
and in addition to this showing also a meritorious defense to the action. It is held that a general
statement that a party has a good defense to the action is insufficient. The necessary facts must be
averred. Of course if a judgment is void upon its face a showing of the existence of a meritorious
defense is not necessary. (10 R. C. L., 718.)

The lapse of time is also a circumstance deeply affecting this aspect of the case. In this connection
we quote the following passage from the encyclopedic treatise now in course of publication:

Where, however, the judgment is not void on its face, and may therefore be enforced if
permitted to stand on the record, courts in many instances refuse to exercise their quasi
equitable powers to vacate a judgement after the lapse of the term ay which it was entered,
except in clear cases, to promote the ends of justice, and where it appears that the party
making the application is himself without fault and has acted in good faith and with ordinary
diligence. Laches on the part of the applicant, if unexplained, is deemed sufficient ground for
refusing the relief to which he might otherwise be entitled. Something is due to the finality of
judgments, and acquiescence or unnecessary delay is fatal to motions of this character,
since courts are always reluctant to interfere with judgments, and especially where they have
been executed or satisfied. The moving party has the burden of showing diligence, and
unless it is shown affirmatively the court will not ordinarily exercise its discretion in his favor.
(15 R. C. L., 694, 695.)

It is stated in the affidavit that the defendant, Engracio Palanca Tanquinyeng y Limquingco, died
January 29, 1910. The mortgage under which the property was sold was executed far back in 1906;
and the proceedings in the foreclosure were closed by the order of court confirming the sale dated
August 7, 1908. It passes the rational bounds of human credulity to suppose that a man who had
placed a mortgage upon property worth nearly P300,000 and had then gone away from the scene of
his life activities to end his days in the city of Amoy, China, should have long remained in ignorance
of the fact that the mortgage had been foreclosed and the property sold, even supposing that he had
no knowledge of those proceedings while they were being conducted. It is more in keeping with the
ordinary course of things that he should have acquired information as to what was transpiring in his
affairs at Manila; and upon the basis of this rational assumption we are authorized, in the absence of
proof to the contrary, to presume that he did have, or soon acquired, information as to the sale of his
property.

The Code of Civil Procedure, indeed, expressly declares that there is a presumption that things have
happened according to the ordinary habits of life (sec. 334 [26]); and we cannot conceive of a
situation more appropriate than this for applying the presumption thus defined by the lawgiver. In
support of this presumption, as applied to the present case, it is permissible to consider the
probability that the defendant may have received actual notice of these proceedings from the
unofficial notice addressed to him in Manila which was mailed by an employee of the bank's
attorneys. Adopting almost the exact words used by the Supreme Court of the United States in
Grannis vs. Ordeans (234 U. S., 385; 58 L. ed., 1363), we may say that in view of the well-known
skill of postal officials and employees in making proper delivery of letters defectively addressed, we
think the presumption is clear and strong that this notice reached the defendant, there being no proof
that it was ever returned by the postal officials as undelivered. And if it was delivered in Manila,
instead of being forwarded to Amoy, China, there is a probability that the recipient was a person
sufficiently interested in his affairs to send it or communicate its contents to him.

Of course if the jurisdiction of the court or the sufficiency of the process of law depended upon the
mailing of the notice by the clerk, the reflections in which we are now indulging would be idle and
frivolous; but the considerations mentioned are introduced in order to show the propriety of applying
to this situation the legal presumption to which allusion has been made. Upon that presumption,
supported by the circumstances of this case, ,we do not hesitate to found the conclusion that the
defendant voluntarily abandoned all thought of saving his property from the obligation which he had
placed upon it; that knowledge of the proceedings should be imputed to him; and that he acquiesced
in the consequences of those proceedings after they had been accomplished. Under these
circumstances it is clear that the merit of this motion is, as we have already stated, adversely
affected in a high degree by the delay in asking for relief. Nor is it an adequate reply to say that the
proponent of this motion is an administrator who only qualified a few months before this motion was
made. No disability on the part of the defendant himself existed from the time when the foreclosure
was effected until his death; and we believe that the delay in the appointment of the administrator
and institution of this action is a circumstance which is imputable to the parties in interest whoever
they may have been. Of course if the minor heirs had instituted an action in their own right to recover
the property, it would have been different.

It is, however, argued that the defendant has suffered prejudice by reason of the fact that the bank
became the purchaser of the property at the foreclosure sale for a price greatly below that which had
been agreed upon in the mortgage as the upset price of the property. In this connection, it appears
that in article nine of the mortgage which was the subject of this foreclosure, as amended by the
notarial document of July 19, 1906, the parties to this mortgage made a stipulation to the effect that
the value therein placed upon the mortgaged properties should serve as a basis of sale in case the
debt should remain unpaid and the bank should proceed to a foreclosure. The upset price stated in
that stipulation for all the parcels involved in this foreclosure was P286,000. It is said in behalf of the
appellant that when the bank bought in the property for the sum of P110,200 it violated that
stipulation.
It has been held by this court that a clause in a mortgage providing for a tipo, or upset price, does
not prevent a foreclosure, nor affect the validity of a sale made in the foreclosure proceedings.
(Yangco vs. Cruz Herrera and Wy Piaco, 11 Phil. Rep., 402; Banco-Español Filipino vs. Donaldson,
Sim and Co., 5 Phil. Rep., 418.) In both the cases here cited the property was purchased at the
foreclosure sale, not by the creditor or mortgagee, but by a third party. Whether the same rule
should be applied in a case where the mortgagee himself becomes the purchaser has apparently not
been decided by this court in any reported decision, and this question need not here be considered,
since it is evident that if any liability was incurred by the bank by purchasing for a price below that
fixed in the stipulation, its liability was a personal liability derived from the contract of mortgage; and
as we have already demonstrated such a liability could not be the subject of adjudication in an action
where the court had no jurisdiction over the person of the defendant. If the plaintiff bank became
liable to account for the difference between the upset price and the price at which in bought in the
property, that liability remains unaffected by the disposition which the court made of this case; and
the fact that the bank may have violated such an obligation can in no wise affect the validity of the
judgment entered in the Court of First Instance.

In connection with the entire failure of the motion to show either a meritorious defense to the action
or that the defendant had suffered any prejudice of which the law can take notice, we may be
permitted to add that in our opinion a motion of this kind, which proposes to unsettle judicial
proceedings long ago closed, can not be considered with favor, unless based upon grounds which
appeal to the conscience of the court. Public policy requires that judicial proceedings be upheld. The
maximum here applicable is non quieta movere. As was once said by Judge Brewer, afterwards a
member of the Supreme Court of the United States:

Public policy requires that judicial proceedings be upheld, and that titles obtained in those
proceedings be safe from the ruthless hand of collateral attack. If technical defects are
adjudged potent to destroy such titles, a judicial sale will never realize that value of the
property, for no prudent man will risk his money in bidding for and buying that title which he
has reason to fear may years thereafter be swept away through some occult and not readily
discoverable defect. (Martin vs. Pond, 30 Fed., 15.)

In the case where that language was used an attempt was made to annul certain foreclosure
proceedings on the ground that the affidavit upon which the order of publication was based
erroneously stated that the State of Kansas, when he was in fact residing in another State. It was
held that this mistake did not affect the validity of the proceedings.

In the preceding discussion we have assumed that the clerk failed to send the notice by post as
required by the order of the court. We now proceed to consider whether this is a proper assumption;
and the proposition which we propose to establish is that there is a legal presumption that the clerk
performed his duty as the ministerial officer of the court, which presumption is not overcome by any
other facts appearing in the cause.

In subsection 14 of section 334 of the Code of Civil Procedure it is declared that there is a
presumption "that official duty has been regularly performed;" and in subsection 18 it is declared that
there is a presumption "that the ordinary course of business has been followed." These
presumptions are of course in no sense novelties, as they express ideas which have always been
recognized. Omnia presumuntur rite et solemniter esse acta donec probetur in contrarium. There is
therefore clearly a legal presumption that the clerk performed his duty about mailing this notice; and
we think that strong considerations of policy require that this presumption should be allowed to
operate with full force under the circumstances of this case. A party to an action has no control over
the clerk of the court; and has no right to meddle unduly with the business of the clerk in the
performance of his duties. Having no control over this officer, the litigant must depend upon the court
to see that the duties imposed on the clerk are performed.

Other considerations no less potent contribute to strengthen the conclusion just stated. There is no
principle of law better settled than that after jurisdiction has once been required, every act of a court
of general jurisdiction shall be presumed to have been rightly done. This rule is applied to every
judgment or decree rendered in the various stages of the proceedings from their initiation to their
completion (Voorhees vs. United States Bank, 10 Pet., 314; 35 U. S., 449); and if the record is silent
with respect to any fact which must have been established before the court could have rightly acted,
it will be presumed that such fact was properly brought to its knowledge. (The Lessee of Grignon vs.
Astor, 2 How., 319; 11 L. ed., 283.)

In making the order of sale [of the real state of a decedent] the court are presumed to have
adjudged every question necessary to justify such order or decree, viz: The death of the
owners; that the petitioners were his administrators; that the personal estate was insufficient
to pay the debts of the deceased; that the private acts of Assembly, as to the manner of sale,
were within the constitutional power of the Legislature, and that all the provisions of the law
as to notices which are directory to the administrators have been complied with. . . . The
court is not bound to enter upon the record the evidence on which any fact was decided.
(Florentine vs. Barton, 2 Wall., 210; 17 L. ed., 785.) Especially does all this apply after long
lapse of time.

Applegate vs. Lexington and Carter County Mining Co. (117 U. S., 255) contains an instructive
discussion in a case analogous to that which is now before us. It there appeared that in order to
foreclose a mortgage in the State of Kentucky against a nonresident debtor it was necessary that
publication should be made in a newspaper for a specified period of time, also be posted at the front
door of the court house and be published on some Sunday, immediately after divine service, in such
church as the court should direct. In a certain action judgment had been entered against a
nonresident, after publication in pursuance of these provisions. Many years later the validity of the
proceedings was called in question in another action. It was proved from the files of an ancient
periodical that publication had been made in its columns as required by law; but no proof was
offered to show the publication of the order at the church, or the posting of it at the front door of the
court-house. It was insisted by one of the parties that the judgment of the court was void for lack of
jurisdiction. But the Supreme Court of the United States said:

The court which made the decree . . . was a court of general jurisdiction. Therefore every
presumption not inconsistent with the record is to be indulged in favor of its jurisdiction. . . . It
is to be presumed that the court before making its decree took care of to see that its order for
constructive service, on which its right to make the decree depended, had been obeyed.

It is true that in this case the former judgment was the subject of collateral , or indirect attack, while
in the case at bar the motion to vacate the judgment is direct proceeding for relief against it. The
same general presumption, however, is indulged in favor of the judgment of a court of general
jurisdiction, whether it is the subject of direct or indirect attack the only difference being that in case
of indirect attack the judgment is conclusively presumed to be valid unless the record affirmatively
shows it to be void, while in case of direct attack the presumption in favor of its validity may in certain
cases be overcome by proof extrinsic to the record.

The presumption that the clerk performed his duty and that the court made its decree with the
knowledge that the requirements of law had been complied with appear to be amply sufficient to
support the conclusion that the notice was sent by the clerk as required by the order. It is true that
there ought to be found among the papers on file in this cause an affidavit, as required by section
400 of the Code of Civil Procedure, showing that the order was in fact so sent by the clerk; and no
such affidavit appears. The record is therefore silent where it ought to speak. But the very purpose of
the law in recognizing these presumptions is to enable the court to sustain a prior judgment in the
face of such an omission. If we were to hold that the judgment in this case is void because the
proper affidavit is not present in the file of papers which we call the record, the result would be that in
the future every title in the Islands resting upon a judgment like that now before us would depend, for
its continued security, upon the presence of such affidavit among the papers and would be liable at
any moment to be destroyed by the disappearance of that piece of paper. We think that no court,
with a proper regard for the security of judicial proceedings and for the interests which have by law
been confided to the courts, would incline to favor such a conclusion. In our opinion the proper
course in a case of this kind is to hold that the legal presumption that the clerk performed his duty
still maintains notwithstanding the absence from the record of the proper proof of that fact.

In this connection it is important to bear in mind that under the practice prevailing in the Philippine
Islands the word "record" is used in a loose and broad sense, as indicating the collective mass of
papers which contain the history of all the successive steps taken in a case and which are finally
deposited in the archives of the clerk's office as a memorial of the litigation. It is a matter of general
information that no judgment roll, or book of final record, is commonly kept in our courts for the
purpose of recording the pleadings and principal proceedings in actions which have been
terminated; and in particular, no such record is kept in the Court of First Instance of the city of
Manila. There is, indeed, a section of the Code of Civil Procedure which directs that such a book of
final record shall be kept; but this provision has, as a matter of common knowledge, been generally
ignored. The result is that in the present case we do not have the assistance of the recitals of such a
record to enable us to pass upon the validity of this judgment and as already stated the question
must be determined by examining the papers contained in the entire file.

But it is insisted by counsel for this motion that the affidavit of Bernardo Chan y Garcia showing that
upon April 4, 1908, he sent a notification through the mail addressed to the defendant at Manila,
Philippine Islands, should be accepted as affirmative proof that the clerk of the court failed in his duty
and that, instead of himself sending the requisite notice through the mail, he relied upon Bernardo to
send it for him. We do not think that this is by any means a necessary inference. Of course if it had
affirmatively appeared that the clerk himself had attempted to comply with this order and had
directed the notification to Manila when he should have directed it to Amoy, this would be conclusive
that he had failed to comply with the exact terms of the order; but such is not this case. That the
clerk of the attorneys for the plaintiff erroneously sent a notification to the defendant at a mistaken
address affords in our opinion very slight basis for supposing that the clerk may not have sent notice
to the right address.

There is undoubtedly good authority to support the position that when the record states the evidence
or makes an averment with reference to a jurisdictional fact, it will not be presumed that there was
other or different evidence respecting the fact, or that the fact was otherwise than stated. If, to give
an illustration, it appears from the return of the officer that the summons was served at a particular
place or in a particular manner, it will not be presumed that service was also made at another place
or in a different manner; or if it appears that service was made upon a person other than the
defendant, it will not be presumed, in the silence of the record, that it was made upon the defendant
also (Galpin vs. Page, 18 Wall., 350, 366; Settlemier vs. Sullivan, 97 U. S., 444, 449). While we
believe that these propositions are entirely correct as applied to the case where the person making
the return is the officer who is by law required to make the return, we do not think that it is properly
applicable where, as in the present case, the affidavit was made by a person who, so far as the
provisions of law are concerned, was a mere intermeddler.
The last question of importance which we propose to consider is whether a motion in the cause is
admissible as a proceeding to obtain relief in such a case as this. If the motion prevails the judgment
of July 2, 1908, and all subsequent proceedings will be set aside, and the litigation will be renewed,
proceeding again from the date mentioned as if the progress of the action had not been interrupted.
The proponent of the motion does not ask the favor of being permitted to interpose a defense. His
purpose is merely to annul the effective judgment of the court, to the end that the litigation may again
resume its regular course.

There is only one section of the Code of Civil Procedure which expressly recognizes the authority of
a Court of First Instance to set aside a final judgment and permit a renewal of the litigation in the
same cause. This is as follows:

SEC. 113. Upon such terms as may be just the court may relieve a party or legal
representative from the judgment, order, or other proceeding taken against him through his
mistake, inadvertence, surprise, or excusable neglect; Provided, That application thereof be
made within a reasonable time, but in no case exceeding six months after such judgment,
order, or proceeding was taken.

An additional remedy by petition to the Supreme Court is supplied by section 513 of the same Code.
The first paragraph of this section, in so far as pertinent to this discussion, provides as follows:

When a judgment is rendered by a Court of First Instance upon default, and a party thereto
is unjustly deprived of a hearing by fraud, accident, mistake or excusable negligence, and
the Court of First Instance which rendered the judgment has finally adjourned so that no
adequate remedy exists in that court, the party so deprived of a hearing may present his
petition to the Supreme Court within sixty days after he first learns of the rendition of such
judgment, and not thereafter, setting forth the facts and praying to have judgment set aside. .
..

It is evident that the proceeding contemplated in this section is intended to supplement the remedy
provided by section 113; and we believe the conclusion irresistible that there is no other means
recognized by law whereby a defeated party can, by a proceeding in the same cause, procure a
judgment to be set aside, with a view to the renewal of the litigation.

The Code of Civil Procedure purports to be a complete system of practice in civil causes, and it
contains provisions describing with much fullness the various steps to be taken in the conduct of
such proceedings. To this end it defines with precision the method of beginning, conducting, and
concluding the civil action of whatever species; and by section 795 of the same Code it is declared
that the procedure in all civil action shall be in accordance with the provisions of this Code. We are
therefore of the opinion that the remedies prescribed in sections 113 and 513 are exclusive of all
others, so far as relates to the opening and continuation of a litigation which has been once
concluded.

The motion in the present case does not conform to the requirements of either of these provisions;
and the consequence is that in our opinion the action of the Court of First Instance in dismissing the
motion was proper.

If the question were admittedly one relating merely to an irregularity of procedure, we cannot
suppose that this proceeding would have taken the form of a motion in the cause, since it is clear
that, if based on such an error, the came to late for relief in the Court of First Instance. But as we
have already seen, the motion attacks the judgment of the court as void for want of jurisdiction over
the defendant. The idea underlying the motion therefore is that inasmuch as the judgment is a nullity
it can be attacked in any way and at any time. If the judgment were in fact void upon its face, that is,
if it were shown to be a nullity by virtue of its own recitals, there might possibly be something in this.
Where a judgment or judicial order is void in this sense it may be said to be a lawless thing, which
can be treated as an outlaw and slain at sight, or ignored wherever and whenever it exhibits its
head.

But the judgment in question is not void in any such sense. It is entirely regular in form, and the
alleged defect is one which is not apparent upon its face. It follows that even if the judgment could
be shown to be void for want of jurisdiction, or for lack of due process of law, the party aggrieved
thereby is bound to resort to some appropriate proceeding to obtain relief. Under accepted principles
of law and practice, long recognized in American courts, a proper remedy in such case, after the
time for appeal or review has passed, is for the aggrieved party to bring an action to enjoin the
judgment, if not already carried into effect; or if the property has already been disposed of he may
institute suit to recover it. In every situation of this character an appropriate remedy is at hand; and if
property has been taken without due process, the law concedes due process to recover it. We
accordingly old that, assuming the judgment to have been void as alleged by the proponent of this
motion, the proper remedy was by an original proceeding and not by motion in the cause. As we
have already seen our Code of Civil Procedure defines the conditions under which relief against a
judgment may be productive of conclusion for this court to recognize such a proceeding as proper
under conditions different from those defined by law. Upon the point of procedure here involved, we
refer to the case of People vs. Harrison (84 Cal., 607) wherein it was held that a motion will not lie to
vacate a judgment after the lapse of the time limited by statute if the judgment is not void on its face;
and in all cases, after the lapse of the time limited by statute if the judgment is not void on its face;
and all cases, after the lapse of such time, when an attempt is made to vacate the judgment by a
proceeding in court for that purpose an action regularly brought is preferable, and should be
required. It will be noted taken verbatim from the California Code (sec. 473).

The conclusions stated in this opinion indicate that the judgment appealed from is without error, and
the same is accordingly affirmed, with costs. So ordered.

Arellano, C.J., Torres, Carson, and Avanceña, JJ., concur.

Separate Opinions

MALCOLM, J., dissenting:

I dissent. It will not make me long to state my reasons. An immutable attribute — the fundamental
idea — of due process of law is that no man shall be condemned in his person or property without
notice and an opportunity of being heard in his defense. Protection of the parties demands a strict
and an exact compliance with this constitutional provision in our organic law and of the statutory
provisions in amplification. Literally hundreds of precedents could be cited in support of these
axiomatic principles. Where as in the instant case the defendant received no notice and had no
opportunity to be heard, certainly we cannot say that there is due process of law. Resultantly, "A
judgment which is void upon its face, and which requires only an inspection of the judgment roll to
demonstrate its want of vitality is a dead limb upon the judicial tree, which should be lopped off, if the
power so to do exists. It can bear no fruit to the plaintiff, but is a constant menace to the defendant."
(Mills vs. Dickons, 6 Rich [S. C.], 487.)
Summary of Shaffer v. Heitner, 433 U.S. 186, 97 S. Ct. 2569, 53 L. Ed. 2d 683 (1977).
Facts
Greyhound, a Delaware corporation, lost a large antitrust judgment and Heitner (P) initiated a shareholder
derivative suit in Delaware against 28 officers and directors of the corporation (i.e. Shaffer, D). Heitner
owned one share of Greyhound stock and was a nonresident of Delaware. Heitner filed a motion for
sequestration of stock owned by 21 of the defendants in order to obtain quasi-in-rem jurisdiction. The
legal situs of the stock was deemed to be in Delaware.

The Delaware sequestration statute allowed property within the state to be seized to allow the Delaware
court to obtain personal jurisdiction over the owner. Shaffer et al. made a special appearance to challenge
the court’s jurisdiction on the grounds that the statute was unconstitutional. Shaffer also asserted that
there were insufficient contacts to confer jurisdiction. The District Court found that the statute was valid,
and did not address the minimum contacts argument due to the finding that the legal presence of the
stock in Delaware conferred quasi-in rem jurisdiction.

Issues
1. Can a state obtain personal jurisdiction over a party based on that party’s ownership of property
in the state?
2. Is quasi in rem jurisdiction subject to the constitutional requirements of minimum contacts?
Holding and Rule (Marshall)
1. No. A state cannot obtain personal jurisdiction over a party based merely on that party’s
ownership of property in the state.
2. Yes. Quasi in rem jurisdiction is subject to the constitutional requirements of minimum contacts.
Rules

Whether or not a State can assert jurisdiction over a nonresident must be evaluated according to the
minimum-contacts standard of International Shoe Co. v. Washington.
In rem jurisdiction: due process under the Fourteenth Amendment requires that the basis for jurisdiction
must be sufficient to justify exercising jurisdiction over the interests of persons in the thing. The presence
of property in a State may allow jurisdiction by providing contacts among the forum State, the defendant,
and the litigation; for example, when claims to the property itself are the source of the underlying
controversy.

Where, as in this case, the property serving as the basis for jurisdiction is completely unrelated to the
plaintiff’s cause of action, the presence of the property alone, i.e., absent other ties among the defendant,
the State, and the litigation, would not support the State’s jurisdiction.

Delaware’s assertion of jurisdiction over appellants, based solely as it is on the statutory presence of
appellants’ property in Delaware, violates the Due Process Clause, which does not contemplate that a
state may make binding a judgment against an individual or corporate defendant with which the state has
no contacts, ties, or relations. Appellants’ holdings in the corporation do not provide contacts with
Delaware sufficient to support jurisdiction of that State’s courts over appellants.

Delaware state-court jurisdiction is not supported by that State’s interest in supervising the management
of a Delaware corporation and defining the obligations of its officers and directors, since Delaware bases
jurisdiction, not on appellants’ status as corporate fiduciaries, but on the presence of their property in the
State.

Though it may be appropriate for Delaware law to govern the obligations of appellants to the corporation
and stockholders, this does not mean that appellants have purposefully availed themselves of the
privilege of conducting activities within the forum State. See Hanson v. Denckla. Appellants, who were
not required to acquire interests in the corporation in order to hold their positions, did not by acquiring
those interests surrender their right to be brought to judgment in the States in which they had minimum
contacts.
Discussion
In Mullane v. Central Hanover Bank and Trust we held certain Fourteenth Amendment rights attach
once an adverse judgment in rem directly affects the property owner by divesting him of his rights in the
property. If jurisdiction over property involves jurisdiction over a person’s interests, the proper standard is
the minimum contacts standard of International Shoe. This makes the assertion of jurisdiction over the
property an assertion of jurisdiction over the person. Thus, all assertions of jurisdiction must be
determined according to the standards of International Shoe and its progeny.
Delaware has a strong interest in supervising the management of corporations created within its borders.
The legislature must assert that interest, however. Delaware is not a fair forum for this litigation because
the officers and directors have never set foot in the state and have not purposefully availed themselves of
the benefits and protections of the state.

Disposition
Reversed.

Concurring (Powell)
I reserve judgment as to whether ownership of real property in a jurisdiction may provide the contacts
necessary for jurisdiction. Quasi in rem jurisdiction should remain valid when real property is involved.

Concurring (Stevens)
This holding should not be read to invalidate in rem jurisdiction.

Concurring in Part and Dissenting in Part (Brennan)

The use of minimum contacts is more than justified and it represents a sensible approach to the exercise
of state court jurisdiction, however the majority’s approach to minimum contacts is wrong. To be proper,
State court jurisdiction must have both notice and a long arm statute. Under this case there is no such
statute.

As a general rule, a state forum has jurisdiction to adjudicate a shareholder derivative action centering on
the conduct and policies of the directors and officers of a corporation incorporated in that State. I
therefore would not foreclose Delaware from asserting jurisdiction over appellants were it persuaded to do
so on the basis of minimum contacts. Heitner however never pleaded or demonstrated that the
defendants had minimum contacts with the state.

Greyhound’s choice of incorporation in Delaware is a prima facie showing of submission to its jurisdiction.
There was a voluntary association with the State of Delaware invoking the benefits and protections of its
laws. The majority opinion is purely advisory once it finds that the state statute is invalid.
IDONAH PERKINS vs. ROXAS ET AL.
GRN 47517, June 27, 1941
FACTS:
July 5, 1938, respondent Eugene Perkins filed a complaint in the CFI- Manila against the Benguet
Consolidated Mining Company for the recovery of a sum consisting of dividends which have been
declared and made payable on shares of stock registered in his name, payment of which was being
withheld by the company, and for the recognition of his right to the control and disposal of said shares
to the exclusion of all others. The company alleged, by way of defense that the withholding of
plaintiff’s right to the disposal and control of the shares was due to certain demands made with
respect to said shares by the petitioner Idonah Perkins, and by one Engelhard.
Eugene Perkins included in his modified complaint as parties defendants petitioner, Idonah Perkins,
and Engelhard. Eugene Perkins prayed that petitioner Idonah Perkins and H. Engelhard be adjudged
without interest in the shares of stock in question and excluded from any claim they assert thereon.
Summons by publication were served upon the nonresident defendants Idonah Perkins and Engelhard.
Engelhard filed his answer. Petitioner filed her answer with a crosscomplaint in which she sets up a
judgment allegedly obtained by her against respondent Eugene Perkins, from the SC of the State of
New York, wherein it is declared that she is the sole legal owner and entitled to the possession and
control of the shares of stock in question with all the cash dividends declared thereon by the Benguet
Consolidated Mining Company.

Idonah Perkins filed a demurrer thereto on the ground that “the court has no jurisdiction of the
subject of the action,” because the alleged judgment of the SC of the State of New York is res
judicata. Petitioner’s demurrer was overruled, thus this petition.

ISSUE:
WON in view of the alleged judgment entered in favor of the petitioner by the SC of New York and
which is claimed by her to be res judicata on all questions raised by the respondent, Eugene Perkins,
the local court has jurisdiction over the subject matter of the action.
RULING:
By jurisdiction over the subject matter is meant the nature of the cause of action and of the relief
sought, and this is conferred by the sovereign authority which organizes the court, and is to be sought
for in general nature of its powers, or in authority specially conferred. In the present case, the
amended complaint filed by the respondent, Eugene Perkins alleged calls for the adjudication of title to
certain shares of stock of the Benguet Consolidated Mining Company and the granting of affirmative
reliefs, which fall within the general jurisdiction of the CFI- Manila. Similarly CFI- Manila is empowered
to adjudicate the several demands contained in petitioner’s crosscomplaint.
Idonah Perkins in her crosscomplaint brought suit against Eugene Perkins and the Benguet
Consolidated Mining Company upon the alleged judgment of the SC of the State of New York and
asked the court below to render judgment enforcing that New York judgment, and to issue execution
thereon. This is a form of action recognized by section 309 of the Code of Civil Procedure (now section
47, Rule 39, Rules of Court) and which falls within the general jurisdiction of the CFI- Manila, to
adjudicate, settle and determine.
The petitioner expresses the fear that the respondent judge may render judgment “annulling the final,
subsisting, valid judgment rendered and entered in this petitioner’s favor by the courts of the State of
New York, which decision is res judicata on all the questions constituting the subject matter of civil
case” and argues on the assumption that the respondent judge is without jurisdiction to take
cognizance of the cause. Whether or not the respondent judge in the course of the proceedings will
give validity and efficacy to the New York judgment set up by the petitioner in her cross-complaint is a
question that goes to the merits of the controversy and relates to the rights of the parties as between
each other, and not to the jurisdiction or power of the court. The test of jurisdiction is whether or not
the tribunal has power to enter upon the inquiry, not whether its conclusion in the course of it is right
or wrong. If its decision is erroneous, its judgment can be reversed on appeal; but its determination of
the question, which the petitioner here anticipates and seeks to prevent, is the exercise by that court
and the rightful exercise of its jurisdiction.

Petition denied.

Alabama Great Southern R.R. v. Carroll

Supreme Court of Alabama
97 Ala. 126 , 11 So. 803 (1892)

MCCLELLAN, J.

The plaintiff, W. D. Carroll, is, and was at the time of entering into the service of the
defendant, the Alabama Great Southern Railroad Company, and at the time of being
injured in that service, a citizen of Alabama. The defendant is an Alabama
corporation, operating a railroad extending from Chattanooga, in the state of
Tennessee, through Alabama to Meridian, in the state of Mississippi. At the time of
the casualty complained of plaintiff was in the service of the defendant in the capacity
of brakeman on freight trains running from Birmingham, Ala., to Meridian, Miss.,
under a contract which was made in the state of Alabama. The injury was caused by
the breaking of a link between two cars in a freight train which was proceeding from
Birmingham to Meridian. The point at which the link broke and the injury was
suffered was in the state of Mississippi. The evidence tended to show that the link
which broke was a defective link, and that it was in a defective condition when the
train left Birmingham. ***

The evidence went also to show that the defect in this link consisted in or resulted
from its having been bent while cold; that this tended to weaken the iron, and in this
instance had cracked the link somewhat on the outer curve of the bend, and that the
link broke at the point of this crack. It was shown to be the duty of certain employees
of defendant stationed along its line to inspect the links attached to cars to be put in
trains, or forming the couplings between cars in trains at Chattanooga, Birmingham,
and some points between Birmingham and the place where this link broke, and also
that it was the duty of the conductor of freight trains, and the other train men, to
maintain such inspection as occasion afforded throughout the runs or trips of such
trains; and the evidence affords ground for inference that there was a negligent
omission on the part of such employees to perform this duty, or, if performed, the
failure to discover the defect in, and to remove, this link was the result of negligence.

The foregoing statement of facts, either proved or finding lodgment in the tendencies
of the evidence, together with the evidence of the law of Mississippi as to the master's
liability for injuries sustained by an employee in his service, will suffice for the
consideration and determination of the question which is of chief importance in this
case, namely, whether the defendant is liable at all, on the facts presented by this
record, for an injury sustained by the plaintiff in the state of Mississippi.

***The only negligence *** which finds support *** in any tendency of the evidence,
is that of persons whose duty it was to inspect the links of the train, and remove such
as were defective, and replace them with others which were not defective. This was
the negligence, not of the master, the defendant, but of fellow servants of the plaintiff,
for which at common law the defendant is not liable. ***

It is, however, further contended that the plaintiff, if his evidence be believed, has
made out a case for the recovery sought under the employers' liability act of Alabama,
it being clearly shown that there is no such or similar law of force in the state of
Mississippi. Considering this position in the abstract,-that is, dissociated from the
facts of this particular case, which are supposed to exert an important influence upon
it,-there cannot be two opinions as to its being unsound and untenable. So looked at,
we do not understand appellee's counsel even to deny either the proposition or its
application to this case,-that there can be no recovery in one state for injuries to the
person sustained in another, unless the infliction of the injuries is actionable under the
law of the state in which they were received. Certainly this is the well-established rule
of law, subject, in some jurisdictions, to the qualification that the infliction of the
injuries would also support an action in the state where the suit is brought had they
been received within that state.***

But it is claimed that the facts of this case take it out of the general rule which the
authorities cited above abundantly support, and authorize the courts of Alabama to
subject the defendant to the payment of damages under section 2590 of the Code,
although the injuries counted on were sustained in Mississippi under circumstances
which involved no liability on the defendant by the laws of that state. This insistence
is, in the first instance, based on that aspect of the evidence which goes to show that
the negligence which produced the casualty transpired in Alabama, and the theory
that, wherever the consequences of that negligence manifested itself, a recovery can
be had in Alabama. We are referred to no authority in support of this proposition, and
exhaustive investigation on our part has failed to disclose any.

***It is admitted, or at least cannot be denied, that negligence of duty unproductive of

damnifying results will not authorize or support a recovery. Up to the time this train
passed out of Alabama no injury had resulted. For all that occurred in Alabama,
therefore, no cause of action whatever arose. The fact which created the right to sue,-
the injury,-without which confessedly no action would lie anywhere, transpired in the
state of Mississippi. It was in that state, therefore, necessarily that the cause of action,
if any, arose; and whether a cause of action arose and existed at all, or not, must in all
reason be determined by the law which obtained at the time and place when and
where the fact which is relied on to justify a recovery transpired. Section 2590 of the
Code of Alabama had no efficacy beyond the lines of Alabama. It cannot be allowed
to operate upon facts occurring in another state, so as to evolve out of them rights and
liabilities which do not exist under the law of that state, which is of course paramount
in the premises.

***Section 2590 of the Code, in other words, is to be interpreted in the light of

universally recognized principles of private, international, or interstate law, as if its
operation had been expressly limited to this state, and as if its first line read as
follows: "When a personal injury is received in Alabama by a servant or employee,"
etc. The negligent infliction of an injury here, under statutory circumstances, creates a
right of action here, which, being transitory, may be enforced in any other state or
country the comity of which admits of it; but for an injury inflicted elsewhere than in
Alabama our statute gives no right of recovery, and the aggrieved party must look to
the local law to ascertain what his rights are. Under that law this plaintiff had no cause
of action, as we have seen, and hence he has no rights which our courts can enforce.
***

Another consideration *** it is insisted, entitles this plaintiff to recover here under the
employers' liability act for an injury inflicted beyond the territorial operation of that
act. This is claimed upon the fact that at the time plaintiff was injured he was in the
discharge of duties which rested on him by the terms of a contract between him and
the defendant, which had been entered into in Alabama, and hence was an Alabama
contract, in connection with the facts that plaintiff was and is a citizen of this state,
and the defendant is an Alabama corporation. These latter facts-of citizenship and
domicile, respectively, of plaintiff and defendant-are of no importance in this
connection, it seems to us, further than this: they may tend to show that the contract
was made here, which is not controverted and, if the plaintiff has a cause of action at
all, he, by reason of them, may prosecute it in our courts. They have no bearing on the
primary question of the existence of a cause of action, and, as that is the question
before us, we need not further advert to the fact of plaintiff's citizenship or defendant's
domicile.****

The contract was that plaintiff should serve the defendant in the capacity of a
brakeman on its freight trains between Birmingham, Ala., and Meridian, Miss., and
should receive as compensation a stipulated sum for each trip from Birmingham to
Meridian and return. The theory is that the employers' liability act became a part of
this contract *** If this argument is sound, and it is sound if the duties and liabilities
prescribed by the act can be said to be contractual duties and obligations at all, it
would lead to conclusions, the possibility of which has not hitherto been suggested by
any court or law writer, and which, to say the least, would be astounding to the
profession.***

It is the purpose of the statute, and must be the limit of its operation, to govern
persons standing in the relation of master and servants to each other, in respect of their
conduct in certain particulars within the state of Alabama. Mississippi has the same
right to establish governmental rules for such persons within her borders as Alabama,
and she has established rules which are different from those of our law; and the
conduct of such persons towards each other is, when its legality is brought in question,
to be adjudged by the rules of the one or the other state, as it falls territorially within
the one or the other. ***

For the error in refusing to instruct the jury to find for the defendant, if they believed
the evidence, the judgment is reversed, and the cause will be remanded.

CADALIN ET AL VS. POEA ET AL

BIENVENIDO M. CADALIN, ROLANDO M. AMUL, DONATO B. EVANGELISTA, and the rest of

1,767 NAMED-COMPLAINANTS, thru and by their Attorney-in-fact, Atty. GERARDO A. DEL
MUNDOvs. PHILIPPINE OVERSEAS EMPLOYMENT ADMINISTRATION’S ADMINISTRATOR,
NLRC, BROWN & ROOT INTERNATIONAL, INC. AND/OR ASIA INTERNATIONAL BUILDERS
CORPORATION
GRN 104776, December 5,1994.
FACTS:
This is a consolidation of 3 cases of SPECIAL CIVIL ACTIONS in the Supreme Court for Certiorari.
On June 6, 1984, Cadalin, Amul and Evangelista, in their own behalf and on behalf of 728 other OCWs
instituted a class suit by filing an “Amended Complaint” with the POEA for money claims arising from
their recruitment by ASIA INTERNATIONAL BUILDERS CORPORATION (AIBC) and employment by
BROWN & ROOT INTERNATIONAL, INC (BRI) which is a foreign corporation with headquarters in
Houston, Texas, and is engaged in construction; while AIBC is a domestic corporation licensed as a
service contractor to recruit, mobilize and deploy Filipino workers for overseas employment on behalf
of its foreign principals.

The amended complaint sought the payment of the unexpired portion of the employment contracts,
which was terminated prematurely, and secondarily, the payment of the interest of the earnings of the
Travel and Reserved Fund; interest on all the unpaid benefits; area wage and salary differential pay;
fringe benefits; reimbursement of SSS and premium not remitted to the SSS; refund of withholding
tax not remitted to the BIR; penalties for committing prohibited practices; as well as the suspension of
the license of AIBC and the accreditation of BRII

On October 2, 1984, the POEA Administrator denied the “Motion to Strike Out of the Records” filed by
AIBC but required the claimants to correct the deficiencies in the complaint pointed out.

AIB and BRII kept on filing Motion for Extension of Time to file their answer. The POEA kept on
granting such motions.

On November 14, 1984, claimants filed an opposition to the motions for extension of time and asked
that AIBC and BRII declared in default for failure to file their answers.

On December 27, 1984, the POEA Administrator issued an order directing AIBC and BRII to file their
answers within ten days from receipt of the order.

(at madami pang motions ang na-file, new complainants joined the case, ang daming inavail na
remedies ng both parties)
On June 19, 1987, AIBC finally submitted its answer to the complaint. At the same hearing, the
parties were given a period of 15 days from said date within which to submit their respective position
papers. On February 24, 1988, AIBC and BRII submitted position paper. On October 27, 1988, AIBC
and BRII filed a “Consolidated Reply,” POEA Adminitartor rendered his decision which awarded the
amount of $824, 652.44 in favor of only 324 complainants. Claimants submitted their “Appeal
Memorandum For Partial Appeal” from the decision of the POEA. AIBC also filed its MR and/or appeal
in addition to the “Notice of Appeal” filed earlier.
NLRC promulgated its Resolution, modifying the decision of the POEA. The resolution removed some of
the benefits awarded in favor of the claimants. NLRC denied all the MRs. Hence, these petitions filed
by the claimants and by AlBC and BRII.

The case rooted from the Labor Law enacted by Bahrain where most of the complainants were
deployed. His Majesty Ise Bin Selman Al Kaifa, Amir of Bahrain, issued his Amiri Decree No. 23 on
June 16, 1176, otherwise known re the Labour Law for the Private Sector. Some of the provision of
Amiri Decree No. 23 that are relevant to the claims of the complainants-appellants are as follows:

“Art. 79: x x x A worker shall receive payment for each extra hour equivalent to his wage entitlement
increased by a minimum of twenty-rive per centurn thereof for hours worked during the day; and by a
minimum off fifty per centurn thereof for hours worked during the night which shall be deemed to
being from seven o’clock in the evening until seven o’clock in the morning .”
Art. 80: Friday shall be deemed to be a weekly day of rest on full pay.
If employee worked, 150% of his normal wage shall be paid to him x x x.”
Art. 81; x x x When conditions of work require the worker to work on any official holiday, he shall be
paid an additional sum equivalent to 150% of his normal wage.”

Art. 84: Every worker who has completed one year’s continuous service with his employer shall be
entitled to Laos on full pay for a period of not less than 21 days for each year increased to a period
not less than 28 days after five continuous years of service.”

A worker shall be entitled to such leave upon a quantum meruit in respect of the proportion of his
service in that year.”

Art. 107: A contract of employment made for a period of indefinite duration may be terminated by
either party thereto after giving the other party prior notice before such termination, in writing, in
respect of monthly paid workers and fifteen days’ notice in respect of other workers. The party
terminating a contract without the required notice shall pay to the other party compensation
equivalent to the amount of wages payable to the worker for the period of such notice or the
unexpired portion thereof.”

Art. Ill: x x x the employer concerned shall pay to such worker, upon termination of employment, a
leaving indemnity for the period of his employment calculated on the basis of fifteen days’ wages for
each year of the first three years of service and of one month’s wages for each year of service
thereafter. Such worker shall be entitled to payment of leaving indemnity upon a quantum meruit in
proportion to the period of his service completed within a year.”

ISSUE:
1. WON the foreign law should govern or the contract of the parties.(WON the complainants who have
worked in Bahrain are entitled to the above-mentioned benefits provided by Amiri Decree No. 23 of
Bahrain).

2. WON the Bahrain Law should apply in the case. (Assuming it is applicable WON complainants’ claim
for the benefits provided therein have prescribed.)

3. Whether or not the instant cases qualify as; a class suit (siningit ko nalang)
(the rest of the issues in the full text of the case refer to Labor Law)
RULING:
1. NLRC set aside Section 1, Rule 129 of the 1989 Revised Rules on Evidence governing the pleading
and proof of a foreign law and admitted in evidence a simple copy of the Bahrain’s Amiri Decree No.
23 of 1976 (Labour Law for the Private Sector).

NLRC applied the Amiri Deere, No. 23 of 1976, which provides for greater benefits than those
stipulated in the overseas-employment contracts of the claimants. It was of the belief that where the
laws of the host country are more favorable and beneficial to the workers, then the laws of the host
country shall form part of the overseas employment contract. It approved the observation of the POEA
Administrator that in labor proceedings, all doubts in the implementation of the provisions of the Labor
Code and its implementing regulations shall be resolved in favor of labor.

The overseas-employment contracts, which were prepared by AIBC and BRII themselves, provided
that the laws of the host country became applicable to said contracts if they offer terms and conditions
more favorable than those stipulated therein. However there was a part of the employment contract
which provides that the compensation of the employee may be “adjusted downward so that the total
computation plus the non-waivable benefits shall be equivalent to the compensation” therein agree,’
another part of the same provision categorically states “that total remuneration and benefits do not
fall below that of the host country regulation and custom.”

Any ambiguity in the overseas-employment contracts should be interpreted against AIBC and BRII,
the parties that drafted it. Article 1377 of the Civil Code of the Philippines provides:
‘The interpretation of obscure words or stipulations in a contract shall not favor the party who caused
the obscurity.”
Said rule of interpretation is applicable to contracts of adhesion where there is already a prepared
form containing the stipulations of the employment contract and the employees merely “take it or
leave it.” The presumption is that there was an imposition by one party against the other and that the
employees signed the contracts out of necessity that reduced their bargaining power.
We read the overseas employment contracts in question as adopting the provisions of the Amiri
Decree No. 23 of 1976 as part and parcel thereof. The parties to a contract may select the law by
which it is to be governed. In such a case, the foreign law is adopted as a “system” to regulate the
relations of the parties, including questions of their capacity to enter into the contract, the formalities
to be observed by them, matters of performance, and so forth. Instead of adopting the entire mass of
the foreign law, the parties may just agree that specific provisions of a foreign statute shall be
deemed incorporated into their contract “as a set of terms.” By such reference to the provisions of the
foreign law, the contract does not become a foreign contract to be governed by the foreign law. The
said law does not operate as a statute but as a set of contractual terms deemed written in the
contract.
A basic policy of contract is to protect the expectation of the parties. Such party expectation is
protected by giving effect to the parties’ own choice of the applicable law. The choice of law must,
however, bear some relationship the parties or their transaction. There is no question that the
contracts sought to be enforced by claimants have a direct connection with the Bahrain law because
the services were rendered in that country.

2. NLRC ruled that the prescriptive period for the filing of the claims of the complainants was 3 years,
as provided in Article 291 of the Labor Code of the Philippines, and not ten years as provided in Article
1144 of the Civil Code of the Philippines nor one year as provided in the Amiri Decree No. 23 of 1976.

Article 156 of the Amiri Decree No. 23 of 1976 provides:

“A claim arising out of a contract of employment shall not actionable after the lapse of one year from
the date of the expiry of the Contract”.
As a general rule, a foreign procedural law will not be applied in the forum (local court), Procedural
matters, such as service of process, joinder of actions, period and requisites for appeal, and so forth,
are governed by the laws of the forum. This is true even if the action is based upon a foreign
substantive law.

A law on prescription of actions is sui generis in Conflict of Laws in the sense that it may be viewed
either as procedural or substantive, depending on the characterization given such a law. In Bournias
v. Atlantic Maritime Company (220 F. 2d. 152, 2d Cir. [1955]), where the issue was the applicability
of the Panama Labor Code in a case filed in the State of New York for claims arising from said Code,
the claims would have prescribed under the Panamanian Law but not under the Statute of Limitations
of New York. The U.S. Circuit Court of Appeals held that the Panamanian Law was procedural as it was
not “specifically intended to be substantive,” hence, the prescriptive period provided in the law of the
forum should apply. The Court observed: “. . . we are dealing with a statute of limitations of a foreign
country, and it is not clear on the face of the statute that its purpose was to limit the enforceability,
outside as well as within the foreign country concerned, of the substantive rights to which the statute
pertains. We think that as a yardstick for determining whether that was the purpose, this test is the
most satisfactory one.

The Court further noted: “Applying that test here it appears to us that the libellant is entitled to
succeed, for the respondents have failed to satisfy us that the Panamanian period of limitation in
question was specifically aimed against the particular rights which the libellant seeks to enforce. The
Panama Labor Code is a statute having broad objectives.” The American court applied the statute of
limitations of New York, instead of the Panamanian law, after finding that there was no showing that
the Panamanian law on prescription was intended to be substantive. Being considered merely a
procedural law even in Panama, it has to give way to the law of the forum (local Court) on prescription
of actions.

However the characterization of a statute into a procedural or substantive law becomes irrelevant
when the country of the forum (local Court) has a “borrowing statute.” Said statute has the practical
effect of treating the foreign statute of limitation as one of substance. A “borrowing statute” directs
the state of the forum (local Court) to apply the foreign statute of limitations to the pending claims
based on a foreign law. While there are several kinds of “borrowing statutes,” one form provides that
an action barred by the laws of the place where it accrued will not be enforced in the forum even
though the local statute was not run against it.

Section 48 of Code of Civil Procedure is of this kind. It provides: “If by the laws of the state or country
where the cause of action arose, the action is barred, it is also barred in the Philippine Islands.”

Section 48 has not been repealed or amended by the Civil Code of the Philippines. In the light of the
1987 Constitution, however, Section 48 cannot be enforced ex proprio vigore insofar as it ordains the
application in this jurisdiction of Section 156 of the Amiri Decree No. 23 of 1976.

The courts of the forum (local Court) will not enforce any foreign claim obnoxious to the forum’s public
policy. To enforce the one-year prescriptive period of the Amiri Decree No. 23 of 1976 as regards the
claims in question would contravene the public policy on the protection to labor.

In the Declaration of Principles and State Policies, the 1987 Constitution emphasized that:“The state
shall promote social justice in all phases of national development” (Sec. 10).
‘The state affirms labor as a primary social economic force. It shall protect the rights of workers and
promote their welfare” (Sec. 18).
In Article XIII on Social Justice and Human Rights, the 1987 Constitution provides:
“Sec. 3. The State shall afford full protection to labor, local and overseas, organized and unorganized,
and promote full employment and equality of employment opportunities for all.”
Thus, the applicable law on prescription is the Philippine law.

The next question is whether the prescriptive period governing the filing of the claims is 3 years, as
provided by the Labor Code or 10 years, as provided by the Civil Code of the Philippines.

Article 1144 of the Civil Code of the Philippines provides:

“The following actions must be brought within ten years from the time the right of action accross:
(1) Upon a written contract; (2) Upon an obligation created by law; (3) Upon a judgment”
In this case, the claim for pay differentials is primarily anchored on the written contracts between the
litigants, the ten-year prescriptive period provided by Art. 1144(l) of the New Civil Code should
govern.
3. NO. A class suit is proper where the subject matter of the controversy is one of common or general
interest to many and the parties are so numerous that it is impracticable to bring them all before the
court. When all the claims are for benefits granted under the Bahrain law many of the claimants
worked outside Bahrain. Some of the claimants were deployed in Indonesia under different terms and
condition of employment.

Inasmuch as the First requirement of a class suit is not present (common or general interest based on
the Amiri Decree of the State of Bahrain), it is only logical that only those who worked in Bahrain shall
be entitled to rile their claims in a class suit.

While there are common defendants (AIBC and BRII) and the nature of the claims is the same (for
employee’s benefits), there is no common question of law or fact. While some claims are based on the
Amiri Law of Bahrain, many of the claimants never worked in that country, but were deployed
elsewhere. Thus, each claimant is interested only in his own demand and not in the claims of the other
employees of defendants. A claimant has no concern in protecting the interests of the other claimants
as shown by the fact, that hundreds of them have abandoned their co-claimants and have entered into
separate compromise settlements of their respective claims. The claimants who worked in Bahrain can
not be allowed to sue in a class suit in a judicial proceeding.

WHEREFORE, all the three petitioners are DISMISSED.

G.R. No. L-16749 January 31, 1963

IN THE MATTER OF THE TESTATE ESTATE OF EDWARD E. CHRISTENSEN, DECEASED.

ADOLFO C. AZNAR, Executor and LUCY CHRISTENSEN, Heir of the deceased, Executor and
Heir-appellees,
vs.
HELEN CHRISTENSEN GARCIA, oppositor-appellant.

M. R. Sotelo for executor and heir-appellees.

Leopoldo M. Abellera and Jovito Salonga for oppositor-appellant.

LABRADOR, J.:

This is an appeal from a decision of the Court of First Instance of Davao, Hon. Vicente N. Cusi, Jr.,
presiding, in Special Proceeding No. 622 of said court, dated September 14, 1949, approving among
things the final accounts of the executor, directing the executor to reimburse Maria Lucy Christensen
the amount of P3,600 paid by her to Helen Christensen Garcia as her legacy, and declaring Maria
Lucy Christensen entitled to the residue of the property to be enjoyed during her lifetime, and in case
of death without issue, one-half of said residue to be payable to Mrs. Carrie Louise C. Borton, etc., in
accordance with the provisions of the will of the testator Edward E. Christensen. The will was
executed in Manila on March 5, 1951 and contains the following provisions:
 3. I declare ... that I have but ONE (1) child, named MARIA LUCY CHRISTENSEN (now Mrs.
Bernard Daney), who was born in the Philippines about twenty-eight years ago, and who is
now residing at No. 665 Rodger Young Village, Los Angeles, California, U.S.A.

4. I further declare that I now have no living ascendants, and no descendants except my
above named daughter, MARIA LUCY CHRISTENSEN DANEY.

xxx xxx xxx

7. I give, devise and bequeath unto MARIA HELEN CHRISTENSEN, now married to
Eduardo Garcia, about eighteen years of age and who, notwithstanding the fact that she was
baptized Christensen, is not in any way related to me, nor has she been at any time adopted
by me, and who, from all information I have now resides in Egpit, Digos, Davao, Philippines,
the sum of THREE THOUSAND SIX HUNDRED PESOS (P3,600.00), Philippine Currency
the same to be deposited in trust for the said Maria Helen Christensen with the Davao
Branch of the Philippine National Bank, and paid to her at the rate of One Hundred Pesos
(P100.00), Philippine Currency per month until the principal thereof as well as any interest
which may have accrued thereon, is exhausted..

xxx xxx xxx

12. I hereby give, devise and bequeath, unto my well-beloved daughter, the said MARIA
LUCY CHRISTENSEN DANEY (Mrs. Bernard Daney), now residing as aforesaid at No. 665
Rodger Young Village, Los Angeles, California, U.S.A., all the income from the rest,
remainder, and residue of my property and estate, real, personal and/or mixed, of
whatsoever kind or character, and wheresoever situated, of which I may be possessed at my
death and which may have come to me from any source whatsoever, during her lifetime: ....

It is in accordance with the above-quoted provisions that the executor in his final account and project
of partition ratified the payment of only P3,600 to Helen Christensen Garcia and proposed that the
residue of the estate be transferred to his daughter, Maria Lucy Christensen.

Opposition to the approval of the project of partition was filed by Helen Christensen Garcia, insofar
as it deprives her (Helen) of her legitime as an acknowledged natural child, she having been
declared by Us in G.R. Nos. L-11483-84 an acknowledged natural child of the deceased Edward E.
Christensen. The legal grounds of opposition are (a) that the distribution should be governed by the
laws of the Philippines, and (b) that said order of distribution is contrary thereto insofar as it denies to
Helen Christensen, one of two acknowledged natural children, one-half of the estate in full
ownership. In amplification of the above grounds it was alleged that the law that should govern the
estate of the deceased Christensen should not be the internal law of California alone, but the entire
law thereof because several foreign elements are involved, that the forum is the Philippines and
even if the case were decided in California, Section 946 of the California Civil Code, which requires
that the domicile of the decedent should apply, should be applicable. It was also alleged that Maria
Helen Christensen having been declared an acknowledged natural child of the decedent, she is
deemed for all purposes legitimate from the time of her birth.

The court below ruled that as Edward E. Christensen was a citizen of the United States and of the
State of California at the time of his death, the successional rights and intrinsic validity of the
provisions in his will are to be governed by the law of California, in accordance with which a testator
has the right to dispose of his property in the way he desires, because the right of absolute dominion
over his property is sacred and inviolable (In re McDaniel's Estate, 77 Cal. Appl. 2d 877, 176 P. 2d
952, and In re Kaufman, 117 Cal. 286, 49 Pac. 192, cited in page 179, Record on Appeal). Oppositor
Maria Helen Christensen, through counsel, filed various motions for reconsideration, but these were
denied. Hence, this appeal.

The most important assignments of error are as follows:

THE LOWER COURT ERRED IN IGNORING THE DECISION OF THE HONORABLE SUPREME
COURT THAT HELEN IS THE ACKNOWLEDGED NATURAL CHILD OF EDWARD E.
CHRISTENSEN AND, CONSEQUENTLY, IN DEPRIVING HER OF HER JUST SHARE IN THE
INHERITANCE.

II

THE LOWER COURT ERRED IN ENTIRELY IGNORING AND/OR FAILING TO RECOGNIZE THE
EXISTENCE OF SEVERAL FACTORS, ELEMENTS AND CIRCUMSTANCES CALLING FOR THE
APPLICATION OF INTERNAL LAW.

III

THE LOWER COURT ERRED IN FAILING TO RECOGNIZE THAT UNDER INTERNATIONAL

LAW, PARTICULARLY UNDER THE RENVOI DOCTRINE, THE INTRINSIC VALIDITY OF THE
TESTAMENTARY DISPOSITION OF THE DISTRIBUTION OF THE ESTATE OF THE DECEASED
EDWARD E. CHRISTENSEN SHOULD BE GOVERNED BY THE LAWS OF THE PHILIPPINES.

IV

THE LOWER COURT ERRED IN NOT DECLARING THAT THE SCHEDULE OF DISTRIBUTION
SUBMITTED BY THE EXECUTOR IS CONTRARY TO THE PHILIPPINE LAWS.

THE LOWER COURT ERRED IN NOT DECLARING THAT UNDER THE PHILIPPINE LAWS
HELEN CHRISTENSEN GARCIA IS ENTITLED TO ONE-HALF (1/2) OF THE ESTATE IN FULL
OWNERSHIP.

There is no question that Edward E. Christensen was a citizen of the United States and of the State
of California at the time of his death. But there is also no question that at the time of his death he
was domiciled in the Philippines, as witness the following facts admitted by the executor himself in
appellee's brief:

In the proceedings for admission of the will to probate, the facts of record show that the
deceased Edward E. Christensen was born on November 29, 1875 in New York City, N.Y.,
U.S.A.; his first arrival in the Philippines, as an appointed school teacher, was on July 1,
1901, on board the U.S. Army Transport "Sheridan" with Port of Embarkation as the City of
San Francisco, in the State of California, U.S.A. He stayed in the Philippines until 1904.

In December, 1904, Mr. Christensen returned to the United States and stayed there for the
following nine years until 1913, during which time he resided in, and was teaching school in
Sacramento, California.
 Mr. Christensen's next arrival in the Philippines was in July of the year 1913. However, in
1928, he again departed the Philippines for the United States and came back here the
following year, 1929. Some nine years later, in 1938, he again returned to his own country,
and came back to the Philippines the following year, 1939.

Wherefore, the parties respectfully pray that the foregoing stipulation of facts be admitted
and approved by this Honorable Court, without prejudice to the parties adducing other
evidence to prove their case not covered by this stipulation of facts.1äwphï1.ñët

Being an American citizen, Mr. Christensen was interned by the Japanese Military Forces in
the Philippines during World War II. Upon liberation, in April 1945, he left for the United
States but returned to the Philippines in December, 1945. Appellees Collective Exhibits "6",
CFI Davao, Sp. Proc. 622, as Exhibits "AA", "BB" and "CC-Daney"; Exhs. "MM", "MM-l",
"MM-2-Daney" and p. 473, t.s.n., July 21, 1953.)

In April, 1951, Edward E. Christensen returned once more to California shortly after the
making of his last will and testament (now in question herein) which he executed at his
lawyers' offices in Manila on March 5, 1951. He died at the St. Luke's Hospital in the City of
Manila on April 30, 1953. (pp. 2-3)

In arriving at the conclusion that the domicile of the deceased is the Philippines, we are persuaded
by the fact that he was born in New York, migrated to California and resided there for nine years,
and since he came to the Philippines in 1913 he returned to California very rarely and only for short
visits (perhaps to relatives), and considering that he appears never to have owned or acquired a
home or properties in that state, which would indicate that he would ultimately abandon the
Philippines and make home in the State of California.

Sec. 16. Residence is a term used with many shades of meaning from mere temporary
presence to the most permanent abode. Generally, however, it is used to denote something
more than mere physical presence. (Goodrich on Conflict of Laws, p. 29)

As to his citizenship, however, We find that the citizenship that he acquired in California when he
resided in Sacramento, California from 1904 to 1913, was never lost by his stay in the Philippines,
for the latter was a territory of the United States (not a state) until 1946 and the deceased appears to
have considered himself as a citizen of California by the fact that when he executed his will in 1951
he declared that he was a citizen of that State; so that he appears never to have intended to
abandon his California citizenship by acquiring another. This conclusion is in accordance with the
following principle expounded by Goodrich in his Conflict of Laws.

The terms "'residence" and "domicile" might well be taken to mean the same thing, a place of
permanent abode. But domicile, as has been shown, has acquired a technical meaning.
Thus one may be domiciled in a place where he has never been. And he may reside in a
place where he has no domicile. The man with two homes, between which he divides his
time, certainly resides in each one, while living in it. But if he went on business which would
require his presence for several weeks or months, he might properly be said to have
sufficient connection with the place to be called a resident. It is clear, however, that, if he
treated his settlement as continuing only for the particular business in hand, not giving up his
former "home," he could not be a domiciled New Yorker. Acquisition of a domicile of choice
requires the exercise of intention as well as physical presence. "Residence simply requires
bodily presence of an inhabitant in a given place, while domicile requires bodily presence in
that place and also an intention to make it one's domicile." Residence, however, is a term
used with many shades of meaning, from the merest temporary presence to the most
 permanent abode, and it is not safe to insist that any one use et the only proper one.
(Goodrich, p. 29)

The law that governs the validity of his testamentary dispositions is defined in Article 16 of the Civil
Code of the Philippines, which is as follows:

ART. 16. Real property as well as personal property is subject to the law of the country
where it is situated.

However, intestate and testamentary successions, both with respect to the order of
succession and to the amount of successional rights and to the intrinsic validity of
testamentary provisions, shall be regulated by the national law of the person whose
succession is under consideration, whatever may be the nature of the property and
regardless of the country where said property may be found.

The application of this article in the case at bar requires the determination of the meaning of the
term "national law" is used therein.

There is no single American law governing the validity of testamentary provisions in the United
States, each state of the Union having its own private law applicable to its citizens only and in force
only within the state. The "national law" indicated in Article 16 of the Civil Code above quoted can
not, therefore, possibly mean or apply to any general American law. So it can refer to no other than
the private law of the State of California.

The next question is: What is the law in California governing the disposition of personal property?
The decision of the court below, sustains the contention of the executor-appellee that under the
California Probate Code, a testator may dispose of his property by will in the form and manner he
desires, citing the case of Estate of McDaniel, 77 Cal. Appl. 2d 877, 176 P. 2d 952. But appellant
invokes the provisions of Article 946 of the Civil Code of California, which is as follows:

If there is no law to the contrary, in the place where personal property is situated, it is
deemed to follow the person of its owner, and is governed by the law of his domicile.

The existence of this provision is alleged in appellant's opposition and is not denied. We have
checked it in the California Civil Code and it is there. Appellee, on the other hand, relies on the case
cited in the decision and testified to by a witness. (Only the case of Kaufman is correctly cited.) It is
argued on executor's behalf that as the deceased Christensen was a citizen of the State of
California, the internal law thereof, which is that given in the abovecited case, should govern the
determination of the validity of the testamentary provisions of Christensen's will, such law being in
force in the State of California of which Christensen was a citizen. Appellant, on the other hand,
insists that Article 946 should be applicable, and in accordance therewith and following the doctrine
of therenvoi, the question of the validity of the testamentary provision in question should be referred
back to the law of the decedent's domicile, which is the Philippines.

The theory of doctrine of renvoi has been defined by various authors, thus:

The problem has been stated in this way: "When the Conflict of Laws rule of the forum refers
a jural matter to a foreign law for decision, is the reference to the purely internal rules of law
of the foreign system; i.e., to the totality of the foreign law minus its Conflict of Laws rules?"
On logic, the solution is not an easy one. The Michigan court chose to accept the renvoi, that
is, applied the Conflict of Laws rule of Illinois which referred the matter back to Michigan law.
But once having determined the the Conflict of Laws principle is the rule looked to, it is
difficult to see why the reference back should not have been to Michigan Conflict of Laws.
This would have resulted in the "endless chain of references" which has so often been
criticized be legal writers. The opponents of the renvoi would have looked merely to the
internal law of Illinois, thus rejecting the renvoi or the reference back. Yet there seems no
compelling logical reason why the original reference should be the internal law rather than to
the Conflict of Laws rule. It is true that such a solution avoids going on a merry-go-round, but
those who have accepted the renvoi theory avoid this inextricabilis circulas by getting off at
the second reference and at that point applying internal law. Perhaps the opponents of
the renvoi are a bit more consistent for they look always to internal law as the rule of
reference.

Strangely enough, both the advocates for and the objectors to the renvoi plead that greater
uniformity will result from adoption of their respective views. And still more strange is the fact
that the only way to achieve uniformity in this choice-of-law problem is if in the dispute the
two states whose laws form the legal basis of the litigation disagree as to whether
the renvoi should be accepted. If both reject, or both accept the doctrine, the result of the
litigation will vary with the choice of the forum. In the case stated above, had the Michigan
court rejected the renvoi, judgment would have been against the woman; if the suit had been
brought in the Illinois courts, and they too rejected the renvoi, judgment would be for the
woman. The same result would happen, though the courts would switch with respect to
which would hold liability, if both courts accepted the renvoi.

The Restatement accepts the renvoi theory in two instances: where the title to land is in
question, and where the validity of a decree of divorce is challenged. In these cases the
Conflict of Laws rule of the situs of the land, or the domicile of the parties in the divorce case,
is applied by the forum, but any further reference goes only to the internal law. Thus, a
person's title to land, recognized by the situs, will be recognized by every court; and every
divorce, valid by the domicile of the parties, will be valid everywhere. (Goodrich, Conflict of
Laws, Sec. 7, pp. 13-14.)

X, a citizen of Massachusetts, dies intestate, domiciled in France, leaving movable property

in Massachusetts, England, and France. The question arises as to how this property is to be
distributed among X's next of kin.

Assume (1) that this question arises in a Massachusetts court. There the rule of the conflict
of laws as to intestate succession to movables calls for an application of the law of the
deceased's last domicile. Since by hypothesis X's last domicile was France, the natural thing
for the Massachusetts court to do would be to turn to French statute of distributions, or
whatever corresponds thereto in French law, and decree a distribution accordingly. An
examination of French law, however, would show that if a French court were called upon to
determine how this property should be distributed, it would refer the distribution to the
national law of the deceased, thus applying the Massachusetts statute of distributions. So on
the surface of things the Massachusetts court has open to it alternative course of action: (a)
either to apply the French law is to intestate succession, or (b) to resolve itself into a French
court and apply the Massachusetts statute of distributions, on the assumption that this is
what a French court would do. If it accepts the so-called renvoidoctrine, it will follow the latter
course, thus applying its own law.
 This is one type of renvoi. A jural matter is presented which the conflict-of-laws rule of the
forum refers to a foreign law, the conflict-of-laws rule of which, in turn, refers the matter back
again to the law of the forum. This is renvoi in the narrower sense. The German term for this
judicial process is 'Ruckverweisung.'" (Harvard Law Review, Vol. 31, pp. 523-571.)

After a decision has been arrived at that a foreign law is to be resorted to as governing a
particular case, the further question may arise: Are the rules as to the conflict of laws
contained in such foreign law also to be resorted to? This is a question which, while it has
been considered by the courts in but a few instances, has been the subject of frequent
discussion by textwriters and essayists; and the doctrine involved has been descriptively
designated by them as the "Renvoyer" to send back, or the "Ruchversweisung", or the
"Weiterverweisung", since an affirmative answer to the question postulated and the operation
of the adoption of the foreign law in toto would in many cases result in returning the main
controversy to be decided according to the law of the forum. ... (16 C.J.S. 872.)

Another theory, known as the "doctrine of renvoi", has been advanced. The theory of the
doctrine of renvoiis that the court of the forum, in determining the question before it, must
take into account the whole law of the other jurisdiction, but also its rules as to conflict of
laws, and then apply the law to the actual question which the rules of the other jurisdiction
prescribe. This may be the law of the forum. The doctrine of therenvoi has generally been
repudiated by the American authorities. (2 Am. Jur. 296)

The scope of the theory of renvoi has also been defined and the reasons for its application in a
country explained by Prof. Lorenzen in an article in the Yale Law Journal, Vol. 27, 1917-1918, pp.
529-531. The pertinent parts of the article are quoted herein below:

The recognition of the renvoi theory implies that the rules of the conflict of laws are to be
understood as incorporating not only the ordinary or internal law of the foreign state or
country, but its rules of the conflict of laws as well. According to this theory 'the law of a
country' means the whole of its law.

xxx xxx xxx

Von Bar presented his views at the meeting of the Institute of International Law, at
Neuchatel, in 1900, in the form of the following theses:

(1) Every court shall observe the law of its country as regards the application of foreign laws.

(2) Provided that no express provision to the contrary exists, the court shall respect:

(a) The provisions of a foreign law which disclaims the right to bind its nationals
abroad as regards their personal statute, and desires that said personal statute shall
be determined by the law of the domicile, or even by the law of the place where the
act in question occurred.

(b) The decision of two or more foreign systems of law, provided it be certain that
one of them is necessarily competent, which agree in attributing the determination of
a question to the same system of law.

xxx xxx xxx

 If, for example, the English law directs its judge to distribute the personal estate of an
Englishman who has died domiciled in Belgium in accordance with the law of his domicile,
he must first inquire whether the law of Belgium would distribute personal property upon
death in accordance with the law of domicile, and if he finds that the Belgian law would make
the distribution in accordance with the law of nationality — that is the English law — he must
accept this reference back to his own law.

We note that Article 946 of the California Civil Code is its conflict of laws rule, while the rule applied
in In re Kaufman, Supra, its internal law. If the law on succession and the conflict of laws rules of
California are to be enforced jointly, each in its own intended and appropriate sphere, the principle
cited In re Kaufman should apply to citizens living in the State, but Article 946 should apply to such
of its citizens as are not domiciled in California but in other jurisdictions. The rule laid down of
resorting to the law of the domicile in the determination of matters with foreign element involved is in
accord with the general principle of American law that the domiciliary law should govern in most
matters or rights which follow the person of the owner.

When a man dies leaving personal property in one or more states, and leaves a will directing
the manner of distribution of the property, the law of the state where he was domiciled at the
time of his death will be looked to in deciding legal questions about the will, almost as
completely as the law of situs is consulted in questions about the devise of land. It is logical
that, since the domiciliary rules control devolution of the personal estate in case of intestate
succession, the same rules should determine the validity of an attempted testamentary
dispostion of the property. Here, also, it is not that the domiciliary has effect beyond the
borders of the domiciliary state. The rules of the domicile are recognized as controlling by
the Conflict of Laws rules at the situs property, and the reason for the recognition as in the
case of intestate succession, is the general convenience of the doctrine. The New York court
has said on the point: 'The general principle that a dispostiton of a personal property, valid at
the domicile of the owner, is valid anywhere, is one of the universal application. It had its
origin in that international comity which was one of the first fruits of civilization, and it this
age, when business intercourse and the process of accumulating property take but little
notice of boundary lines, the practical wisdom and justice of the rule is more apparent than
ever. (Goodrich, Conflict of Laws, Sec. 164, pp. 442-443.)

Appellees argue that what Article 16 of the Civil Code of the Philippines pointed out as the national
law is the internal law of California. But as above explained the laws of California have prescribed
two sets of laws for its citizens, one for residents therein and another for those domiciled in other
jurisdictions. Reason demands that We should enforce the California internal law prescribed for its
citizens residing therein, and enforce the conflict of laws rules for the citizens domiciled abroad. If we
must enforce the law of California as in comity we are bound to go, as so declared in Article 16 of
our Civil Code, then we must enforce the law of California in accordance with the express mandate
thereof and as above explained, i.e., apply the internal law for residents therein, and its conflict-of-
laws rule for those domiciled abroad.

It is argued on appellees' behalf that the clause "if there is no law to the contrary in the place where
the property is situated" in Sec. 946 of the California Civil Code refers to Article 16 of the Civil Code
of the Philippines and that the law to the contrary in the Philippines is the provision in said Article 16
that the national law of the deceased should govern. This contention can not be sustained. As
explained in the various authorities cited above the national law mentioned in Article 16 of our Civil
Code is the law on conflict of laws in the California Civil Code, i.e., Article 946, which authorizes the
reference or return of the question to the law of the testator's domicile. The conflict of laws rule in
California, Article 946, Civil Code, precisely refers back the case, when a decedent is not domiciled
in California, to the law of his domicile, the Philippines in the case at bar. The court of the domicile
can not and should not refer the case back to California; such action would leave the issue incapable
of determination because the case will then be like a football, tossed back and forth between the two
states, between the country of which the decedent was a citizen and the country of his domicile. The
Philippine court must apply its own law as directed in the conflict of laws rule of the state of the
decedent, if the question has to be decided, especially as the application of the internal law of
California provides no legitime for children while the Philippine law, Arts. 887(4) and 894, Civil Code
of the Philippines, makes natural children legally acknowledged forced heirs of the parent
recognizing them.

The Philippine cases (In re Estate of Johnson, 39 Phil. 156; Riera vs. Palmaroli, 40 Phil. 105;
Miciano vs. Brimo, 50 Phil. 867; Babcock Templeton vs. Rider Babcock, 52 Phil. 130; and Gibbs vs.
Government, 59 Phil. 293.) cited by appellees to support the decision can not possibly apply in the
case at bar, for two important reasons, i.e., the subject in each case does not appear to be a citizen
of a state in the United States but with domicile in the Philippines, and it does not appear in each
case that there exists in the state of which the subject is a citizen, a law similar to or identical with
Art. 946 of the California Civil Code.

We therefore find that as the domicile of the deceased Christensen, a citizen of California, is the
Philippines, the validity of the provisions of his will depriving his acknowledged natural child, the
appellant, should be governed by the Philippine Law, the domicile, pursuant to Art. 946 of the Civil
Code of California, not by the internal law of California..

WHEREFORE, the decision appealed from is hereby reversed and the case returned to the lower
court with instructions that the partition be made as the Philippine law on succession provides.
Judgment reversed, with costs against appellees.

G.R. Nos. L-27860 and L-27896 March 29, 1974

PHILIPPINE COMMERCIAL AND INDUSTRIAL BANK, Administrator of the Testate Estate of
Charles Newton Hodges (Sp. Proc. No. 1672 of the Court of First Instance of Iloilo), petitioner,
vs.
THE HONORABLE VENICIO ESCOLIN, Presiding Judge of the Court of First Instance of Iloilo,
Branch II, and AVELINA A. MAGNO, respondents.
G.R. Nos. L-27936 & L-27937 March 29, 1974
TESTATE ESTATE OF THE LATE LINNIE JANE HODGES (Sp. Proc. No. 1307). TESTATE ESTATE
OF THE LATE CHARLES NEWTON HODGES (Sp. Proc. No. 1672). PHILIPPINE COMMERCIAL AND
INDUSTRIAL BANK, administrator-appellant,
vs.
LORENZO CARLES, JOSE PABLICO, ALFREDO CATEDRAL, SALVADOR GUZMAN, BELCESAR
CAUSING, FLORENIA BARRIDO, PURIFICACION CORONADO, GRACIANO LUCERO, ARITEO
THOMAS JAMIR, MELQUIADES BATISANAN, PEPITO IYULORES, ESPERIDION PARTISALA,
WINIFREDO ESPADA, ROSARIO ALINGASA, ADELFA PREMAYLON, SANTIAGO PACAONSIS, and
AVELINA A. MAGNO, the last as Administratrix in Sp. Proc. No. 1307, appellees, WESTERN
INSTITUTE OF TECHNOLOGY, INC., movant-appellee.
San Juan, Africa, Gonzales and San Agustin for Philippine Commercial and Industrial Bank.
Manglapus Law Office, Antonio Law Office and Rizal R. Quimpo for private respondents and appellees
Avelina A. Magno, etc., et al.
BARREDO, J.:p
Certiorari and prohibition with preliminary injunction; certiorari to “declare all acts of the respondent court
in the Testate Estate of Linnie Jane Hodges (Sp. Proc. No. 1307 of the Court of First Instance of Iloilo)
subsequent to the order of December 14, 1957 as null and void for having been issued without
jurisdiction”; prohibition to enjoin the respondent court from allowing, tolerating, sanctioning, or abetting
private respondent Avelina A. Magno to perform or do any acts of administration, such as those
enumerated in the petition, and from exercising any authority or power as Regular Administratrix of
above-named Testate Estate, by entertaining manifestations, motion and pleadings filed by her and acting
on them, and also to enjoin said court from allowing said private respondent to interfere, meddle or take
part in any manner in the administration of the Testate Estate of Charles Newton Hodges (Sp. Proc. No.
1672 of the same court and branch); with prayer for preliminary injunction, which was issued by this Court
on August 8, 1967 upon a bond of P5,000; the petition being particularly directed against the orders of the
respondent court of October 12, 1966 denying petitioner’s motion of April 22, 1966 and its order of July
18, 1967 denying the motion for reconsideration of said order.
Related to and involving basically the same main issue as the foregoing petition, thirty-three (33) appeals
from different orders of the same respondent court approving or otherwise sanctioning the acts of
administration of the respondent Magno on behalf of the testate Estate of Mrs. Hodges.

THE FACTS
On May 23, 1957, Linnie Jane Hodges died in Iloilo City leaving a will executed on November 22, 1952
pertinently providing as follows:

FIRST: I direct that all my just debts and funeral expenses be first paid out of my estate.

SECOND: I give, devise and bequeath all of the rest, residue and remainder of my estate, both personal
and real, wherever situated, or located, to my beloved husband, Charles Newton Hodges, to have and to
hold unto him, my said husband, during his natural lifetime.

THIRD: I desire, direct and provide that my husband, Charles Newton Hodges, shall have the right to
manage, control, use and enjoy said estate during his lifetime, and he is hereby given the right to make
any changes in the physical properties of said estate, by sale or any part thereof which he may think best,
and the purchase of any other or additional property as he may think best; to execute conveyances with
or without general or special warranty, conveying in fee simple or for any other term or time, any property
which he may deem proper to dispose of; to lease any of the real property for oil, gas and/or other
minerals, and all such deeds or leases shall pass the absolute fee simple title to the interest so conveyed
in such property as he may elect to sell. All rents, emoluments and income from said estate shall belong
to him, and he is further authorized to use any part of the principal of said estate as he may need or
desire. It is provided herein, however, that he shall not sell or otherwise dispose of any of the improved
property now owned by us located at, in or near the City of Lubbock, Texas, but he shall have the full right
to lease, manage and enjoy the same during his lifetime, above provided. He shall have the right to
subdivide any farm land and sell lots therein. and may sell unimproved town lots.

FOURTH: At the death of my said husband, Charles Newton Hodges, I give, devise and bequeath all of
the rest, residue and remainder of my estate, both real and personal, wherever situated or located, to be
equally divided among my brothers and sisters, share and share alike, namely:

Esta Higdon, Emma Howell, Leonard Higdon, Roy Higdon, Saddie Rascoe, Era Roman and Nimroy
Higdon.

FIFTH: In case of the death of any of my brothers and/or sisters named in item Fourth, above, prior to the
death of my husband, Charles Newton Hodges, then it is my will and bequest that the heirs of such
deceased brother or sister shall take jointly the share which would have gone to such brother or sister had
she or he survived.

SIXTH: I nominate and appoint my said husband, Charles Newton Hodges, to be executor of this, my last
will and testament, and direct that no bond or other security be required of him as such executor.

SEVENTH: It is my will and bequest that no action be had in the probate court, in the administration of my
estate, other than that necessary to prove and record this will and to return an inventory and
appraisement of my estate and list of claims. (Pp. 2-4, Petition.)

This will was subsequently probated in aforementioned Special Proceedings No. 1307 of respondent
court on June 28, 1957, with the widower Charles Newton Hodges being appointed as Executor, pursuant
to the provisions thereof.

Previously, on May 27, 1957, the said widower (hereafter to be referred to as Hodges) had been
appointed Special Administrator, in which capacity he filed a motion on the same date as follows:

URGENT EX-PARTE MOTION TO ALLOW OR AUTHORIZE PETITIONER TO CONTINUE THE

BUSINESS IN WHICH HE WAS ENGAGED AND TO PERFORM ACTS WHICH HE HAD BEEN DOING
WHILE DECEASED WAS LIVING
Come petitioner in the above-entitled special proceedings, thru his undersigned attorneys, to the Hon.
Court, most respectfully states:

1. — That Linnie Jane Hodges died leaving her last will and testament, a copy of which is attached to the
petition for probate of the same.

2. — That in said last will and testament herein petitioner Charles Newton Hodges is directed to have the
right to manage, control use and enjoy the estate of deceased Linnie Jane Hodges, in the same way, a
provision was placed in paragraph two, the following: “I give, devise and bequeath all of the rest, residue
and remainder of my estate, to my beloved husband, Charles Newton Hodges, to have and (to) hold unto
him, my said husband, during his natural lifetime.”
3. — That during the lifetime of Linnie Jane Hodges, herein petitioner was engaged in the business of
buying and selling personal and real properties, and do such acts which petitioner may think best.

4. — That deceased Linnie Jane Hodges died leaving no descendants or ascendants, except brothers
and sisters and herein petitioner as executor surviving spouse, to inherit the properties of the decedent.

5. — That the present motion is submitted in order not to paralyze the business of petitioner and the
deceased, especially in the purchase and sale of properties. That proper accounting will be had also in all
these transactions.

WHEREFORE, it is most respectfully prayed that, petitioner C. N. Hodges (Charles Newton Hodges) be
allowed or authorized to continue the business in which he was engaged and to perform acts which he
had been doing while deceased Linnie Jane Hodges was living.

City of Iloilo, May 27, 1957. (Annex “D”, Petition.)

which the respondent court immediately granted in the following order:

It appearing in the urgent ex-parte motion filed by petitioner C. N. Hodges, that the business in which said
petitioner and the deceased were engaged will be paralyzed, unless and until the Executor is named and
appointed by the Court, the said petitioner is allowed or authorized to continue the business in which he
was engaged and to perform acts which he had been doing while the deceased was living.
SO ORDERED.

City of Iloilo May 27, 1957. (Annex “E”, Petition.)

Under date of December 11, 1957, Hodges filed as such Executor another motion thus:

MOTION TO APPROVE ALL SALES, CONVEYANCES, LEASES, MORTGAGES THAT THE

EXECUTOR HAD MADE FURTHER AND SUBSEQUENT TRANSACTIONS WHICH THE EXECUTOR
MAY DO IN ACCORDANCE WITH THE LAST WISH OF THE DECEASED LINNIE JANE HODGES.

Comes the Executor in the above-entitled proceedings, thru his undersigned attorney, to the Hon. Court,
most respectfully states:

1. — That according to the last will and testament of the deceased Linnie Jane Hodges, the executor as
the surviving spouse and legatee named in the will of the deceased; has the right to dispose of all the
properties left by the deceased, portion of which is quoted as follows:

Second: I give, devise and bequeath all of the rest, residue and remainder of my estate, both personal
and real, wherever situated, or located, to my beloved husband, Charles Newton Hodges, to have and to
hold unto him, my said husband, during his natural lifetime.
Third: I desire, direct and provide that my husband, Charles Newton Hodges, shall have the right to
manage, control, use and enjoy said estate during his lifetime, and he is hereby given the right to make
any changes in the physical properties of said estate, by sale or any part thereof which he may think best,
and the purchase of any other or additional property as he may think best; to execute conveyances with
or without general or special warranty, conveying in fee simple or for any other term or time, any property
which he may deem proper to dispose of; to lease any of the real property for oil, gas and/or other
minerals, and all such deeds or leases shall pass the absolute fee simple title to the interest so conveyed
in such property as he may elect to sell. All rents, emoluments and income from said estate shall belong
to him, and he is further authorized to use any part of the principal of said estate as he may need or
desire. …
2. — That herein Executor, is not only part owner of the properties left as conjugal, but also, the
successor to all the properties left by the deceased Linnie Jane Hodges. That during the lifetime of herein
Executor, as Legatee has the right to sell, convey, lease or dispose of the properties in the Philippines.
That inasmuch as C.N. Hodges was and is engaged in the buy and sell of real and personal properties,
even before the death of Linnie Jane Hodges, a motion to authorize said C.N. Hodges was filed in Court,
to allow him to continue in the business of buy and sell, which motion was favorably granted by the
Honorable Court.

3. — That since the death of Linnie Jane Hodges, Mr. C.N. Hodges had been buying and selling real and
personal properties, in accordance with the wishes of the late Linnie Jane Hodges.

4. — That the Register of Deeds for Iloilo, had required of late the herein Executor to have all the sales,
leases, conveyances or mortgages made by him, approved by the Hon. Court.

5. — That it is respectfully requested, all the sales, conveyances leases and mortgages executed by the
Executor, be approved by the Hon. Court. and subsequent sales conveyances, leases and mortgages in
compliances with the wishes of the late Linnie Jane Hodges, and within the scope of the terms of the last
will and testament, also be approved;

6. — That the Executor is under obligation to submit his yearly accounts, and the properties conveyed
can also be accounted for, especially the amounts received.

WHEREFORE, it is most respectfully prayed that, all the sales, conveyances, leases, and mortgages
executed by the Executor, be approved by the Hon. Court, and also the subsequent sales, conveyances,
leases, and mortgages in consonance with the wishes of the deceased contained in her last will and
testament, be with authorization and approval of the Hon. Court.

City of Iloilo, December 11, 1967.

(Annex “G”, Petition.)

which again was promptly granted by the respondent court on December 14, 1957 as follows:
ORDER
As prayed for by Attorney Gellada, counsel for the Executor for the reasons stated in his motion dated
December 11, 1957, which the Court considers well taken all the sales, conveyances, leases and
mortgages of all properties left by the deceased Linnie Jane Hodges executed by the Executor Charles N.
Hodges are hereby APPROVED. The said Executor is further authorized to execute subsequent sales,
conveyances, leases and mortgages of the properties left by the said deceased Linnie Jane Hodges in
consonance with the wishes conveyed in the last will and testament of the latter.

So ordered.

Iloilo City. December 14, 1957.

(Annex “H”, Petition.)

On April 14, 1959, in submitting his first statement of account as Executor for approval, Hodges alleged:

Pursuant to the provisions of the Rules of Court, herein executor of the deceased, renders the following
account of his administration covering the period from January 1, 1958 to December 31, 1958, which
account may be found in detail in the individual income tax return filed for the estate of deceased Linnie
Jane Hodges, to wit:

That a certified public accountant has examined the statement of net worth of the estate of Linnie Jane
Hodges, the assets and liabilities, as well as the income and expenses, copy of which is hereto attached
and made integral part of this statement of account as Annex “A”.

IN VIEW OF THE FOREGOING, it is most respectfully prayed that, the statement of net worth of the
estate of Linnie Jane Hodges, the assets and liabilities, income and expenses as shown in the individual
income tax return for the estate of the deceased and marked as Annex “A”, be approved by the
Honorable Court, as substantial compliance with the requirements of the Rules of Court.

That no person interested in the Philippines of the time and place of examining the herein accounts be
given notice, as herein executor is the only devisee or legatee of the deceased, in accordance with the
last will and testament already probated by the Honorable court.

City of Iloilo April 14, 1959.

(Annex “I”, Petition.)

The respondent court approved this statement of account on April 21, 1959 in its order worded thus:

Upon petition of Atty. Gellada, in representation of the Executor, the statement of net worth of the estate
of Linnie Jane Hodges, assets and liabilities, income and expenses as shown in the individual income tax
return for the estate of the deceased and marked as Annex “A” is approved.
SO ORDERED.

City of Iloilo April 21, 1959.

(Annex “J”, Petition.)

His accounts for the periods January 1, 1959 to December 31, 1959 and January 1, 1960 to December
31, 1960 were submitted likewise accompanied by allegations identical mutatis mutandis to those of April
14, 1959, quoted above; and the respective orders approving the same, dated July 30, 1960 and May 2,
1961, were substantially identical to the above-quoted order of April 21, 1959. In connection with the
statements of account just mentioned, the following assertions related thereto made by respondent-
appellee Magno in her brief do not appear from all indications discernible in the record to be disputable:
Under date of April 14, 1959, C.N. Hodges filed his first “Account by the Executor” of the estate of Linnie
Jane Hodges. In the “Statement of Networth of Mr. C.N. Hodges and the Estate of Linnie Jane Hodges”
as of December 31, 1958 annexed thereto, C.N. Hodges reported that the combined conjugal estate
earned a net income of P328,402.62, divided evenly between him and the estate of Linnie Jane Hodges.
Pursuant to this, he filed an “individual income tax return” for calendar year 1958 on the estate of Linnie
Jane Hodges reporting, under oath, the said estate as having earned income of P164,201.31, exactly
one-half of the net income of his combined personal assets and that of the estate of Linnie Jane Hodges.
(p. 91, Appellee’s Brief.)

xxx xxx xxx

Under date of July 21, 1960, C.N. Hodges filed his second “Annual Statement of Account by the
Executor” of the estate of Linnie Jane Hodges. In the “Statement of Networth of Mr. C.N. Hodges and the
Estate of Linnie Jane Hodges” as of December 31, 1959 annexed thereto, C.N. Hodges reported that the
combined conjugal estate earned a net income of P270,623.32, divided evenly between him and the
estate of Linnie Jane Hodges. Pursuant to this, he filed an “individual income tax return” for calendar year
1959 on the estate of Linnie Jane Hodges reporting, under oath, the said estate as having earned income
of P135,311.66, exactly one-half of the net income of his combined personal assets and that of the estate
of Linnie Jane Hodges. (pp. 91-92. Appellee’s Brief.)

xxx xxx xxx

Under date of April 20, 1961, C.N. Hodges filed his third “Annual Statement of Account by the Executor
for the Year 1960″ of the estate of Linnie Jane Hodges. In the “Statement of Net Worth of Mr. C.N.
Hodges and the Estate of Linnie Jane Hodges” as of December 31, 1960 annexed thereto, C.N. Hodges
reported that the combined conjugal estate earned a net income of P314,857.94, divided evenly between
him and the estate of Linnie Jane Hodges. Pursuant to this, he filed an “individual income tax return” for
calendar year 1960 on the estate of Linnie Jane Hodges reporting, under oath, the said estate as having
earned income of P157,428.97, exactly one-half of the net income of his combined personal assets and
that of the estate of Linnie Jane Hodges. (Pp. 92-93, Appellee’s Brief.)
Likewise the following:

In the petition for probate that he (Hodges) filed, he listed the seven brothers and sisters of Linnie Jane as
her “heirs” (see p. 2, Green ROA). The order of the court admitting the will to probate unfortunately
omitted one of the heirs, Roy Higdon (see p. 14, Green ROA). Immediately, C.N. Hodges filed a verified
motion to have Roy Higdon’s name included as an heir, stating that he wanted to straighten the records
“in order the heirs of deceased Roy Higdon may not think or believe they were omitted, and that they
were really and are interested in the estate of deceased Linnie Jane Hodges. .

As an executor, he was bound to file tax returns for the estate he was administering under American law.
He did file such as estate tax return on August 8, 1958. In Schedule “M” of such return, he answered
“Yes” to the question as to whether he was contemplating “renouncing the will”. On the question as to
what property interests passed to him as the surviving spouse, he answered:

“None, except for purposes of administering the Estate, paying debts, taxes and other legal charges. It is
the intention of the surviving husband of deceased to distribute the remaining property and interests of the
deceased in their Community estate to the devisees and legatees named in the will when the debts,
liabilities, taxes and expenses of administration are finally determined and paid.”

Again, on August 9, 1962, barely four months before his death, he executed an “affidavit” wherein he
ratified and confirmed all that he stated in Schedule “M” of his estate tax returns as to his having
renounced what was given him by his wife’s will. 1
As appointed executor, C.N. Hodges filed an “Inventory” dated May 12, 1958. He listed all the assets of
his conjugal partnership with Linnie Jane Hodges on a separate balance sheet and then stated expressly
that her estate which has come into his possession as executor was “one-half of all the items” listed in
said balance sheet. (Pp. 89-90, Appellee’s Brief.)

Parenthetically, it may be stated, at this juncture, that We are taking pains to quote wholly or at least,
extensively from some of the pleadings and orders whenever We feel that it is necessary to do so for a
more comprehensive and clearer view of the important and decisive issues raised by the parties and a
more accurate appraisal of their respective positions in regard thereto.

The records of these cases do not show that anything else was done in the above-mentioned Special
Proceedings No. 1307 until December 26, 1962, when on account of the death of Hodges the day before,
the same lawyer, Atty. Leon P. Gellada, who had been previously acting as counsel for Hodges in his
capacity as Executor of his wife’s estate, and as such had filed the aforequoted motions and
manifestations, filed the following:

URGENT EX-PARTE MOTION FOR THE APPOINTMENT OF A

SPECIAL ADMINISTRATRIX
COMES the undersigned attorney for the Executor in the above-entitled proceedings, to the Honorable
Court, most respectfully states:
1. That in accordance with the Last Will and Testament of Linnie Jane Hodges (deceased), her husband,
Charles Newton Hodges was to act as Executor, and in fact, in an order issued by this Hon. Court dated
June 28, 1957, the said Charles Newton Hodges was appointed Executor and had performed the duties
as such.

2. That last December 22, 1962, the said Charles Newton Hodges was stricken ill, and brought to the
Iloilo Mission Hospital for treatment, but unfortunately, he died on December 25, 1962, as shown by a
copy of the death certificate hereto attached and marked as Annex “A”.

3. That in accordance with the provisions of the last will and testament of Linnie Jane Hodges, whatever
real and personal properties that may remain at the death of her husband Charles Newton Hodges, the
said properties shall be equally divided among their heirs. That there are real and personal properties left
by Charles Newton Hodges, which need to be administered and taken care of.

4. That the estate of deceased Linnie Jane Hodges, as well as that of Charles Newton Hodges, have not
as yet been determined or ascertained, and there is necessity for the appointment of a general
administrator to liquidate and distribute the residue of the estate to the heirs and legatees of both
spouses. That in accordance with the provisions of Section 2 of Rule 75 of the Rules of Court, the
conjugal partnership of Linnie Jane Hodges and Charles Newton Hodges shall be liquidated in the testate
proceedings of the wife.

5. That the undersigned counsel, has perfect personal knowledge of the existence of the last will and
testament of Charles Newton Hodges, with similar provisions as that contained in the last will and
testament of Linnie Jane Hodges. However, said last will and testament of Charles Newton Hodges is
kept inside the vault or iron safe in his office, and will be presented in due time before this honorable
Court.

6. That in the meantime, it is imperative and indispensable that, an Administratrix be appointed for the
estate of Linnie Jane Hodges and a Special Administratrix for the estate of Charles Newton Hodges, to
perform the duties required by law, to administer, collect, and take charge of the goods, chattels, rights,
credits, and estate of both spouses, Charles Newton Hodges and Linnie Jane Hodges, as provided for in
Section 1 and 2, Rule 81 of the Rules of Court.

7. That there is delay in granting letters testamentary or of administration, because the last will and
testament of deceased, Charles Newton Hodges, is still kept in his safe or vault, and in the meantime,
unless an administratrix (and,) at the same time, a Special Administratrix is appointed, the estate of both
spouses are in danger of being lost, damaged or go to waste.

8. That the most trusted employee of both spouses Linnie Jane Hodges and C.N. Hodges, who had been
employed for around thirty (30) years, in the person of Miss Avelina Magno, (should) be appointed
Administratrix of the estate of Linnie Jane Hodges and at the same time Special Administratrix of the
estate of Charles Newton Hodges. That the said Miss Avelina Magno is of legal age, a resident of the
Philippines, the most fit, competent, trustworthy and well-qualified person to serve the duties of
Administratrix and Special Administratrix and is willing to act as such.

9. That Miss Avelina Magno is also willing to file bond in such sum which the Hon. Court believes
reasonable.

WHEREFORE, in view of all the foregoing, it is most respectfully prayed that, Miss AVELINA A. MAGNO
be immediately appointed Administratrix of the estate of Linnie Jane Hodges and as Special
Administratrix of the estate of Charles Newton Hodges, with powers and duties provided for by law. That
the Honorable Court fix the reasonable bond of P1,000.00 to be filed by Avelina A. Magno.

(Annex “O”, Petition.)

which respondent court readily acted on in its order of even date thus: .

For the reasons alleged in the Urgent Ex-parte Motion filed by counsel for the Executor dated December
25, 1962, which the Court finds meritorious, Miss AVELINA A. MAGNO, is hereby appointed
Administratrix of the estate of Linnie Jane Hodges and as Special Administratrix of the estate of Charles
Newton Hodges, in the latter case, because the last will of said Charles Newton Hodges is still kept in his
vault or iron safe and that the real and personal properties of both spouses may be lost, damaged or go to
waste, unless a Special Administratrix is appointed.
Miss Avelina A. Magno is required to file bond in the sum of FIVE THOUSAND PESOS (P5,000.00), and
after having done so, let letters of Administration be issued to her.” (Annex “P”, Petition.)

On December 29, 1962, however, upon urgent ex-parte petition of respondent Magno herself, thru Atty.
Gellada, Harold, R. Davies, “a representative of the heirs of deceased Charles Newton Hodges (who had)
arrived from the United States of America to help in the administration of the estate of said deceased”
was appointed as Co-Special Administrator of the estate of Hodges, (pp. 29-33, Yellow – Record on
Appeal) only to be replaced as such co-special administrator on January 22, 1963 by Joe Hodges, who,
according to the motion of the same attorney, is “the nephew of the deceased (who had) arrived from the
United States with instructions from the other heirs of the deceased to administer the properties or estate
of Charles Newton Hodges in the Philippines, (Pp. 47-50, id.)
Meanwhile, under date of January 9, 1963, the same Atty. Gellada filed in Special Proceedings 1672 a
petition for the probate of the will of Hodges, 2with a prayer for the issuance of letters of administration to
the same Joe Hodges, albeit the motion was followed on February 22, 1963 by a separate one asking
that Atty. Fernando Mirasol be appointed as his co-administrator. On the same date this latter motion was
filed, the court issued the corresponding order of probate and letters of administration to Joe Hodges and
Atty. Mirasol, as prayed for.
At this juncture, again, it may also be explained that just as, in her will, Mrs. Hodges bequeathed her
whole estate to her husband “to have and to hold unto him, my said husband, during his natural lifetime”,
she, at the same time or in like manner, provided that “at the death of my said husband — I give devise
and bequeath all of the rest, residue and remainder of my estate, both real and personal, wherever
situated or located, to be equally divided among my brothers and sisters, share and share alike —”.
Accordingly, it became incumbent upon Hodges, as executor of his wife’s will, to duly liquidate the
conjugal partnership, half of which constituted her estate, in order that upon the eventuality of his death,
“the rest, residue and remainder” thereof could be determined and correspondingly distributed or divided
among her brothers and sisters. And it was precisely because no such liquidation was done, furthermore,
there is the issue of whether the distribution of her estate should be governed by the laws of the
Philippines or those of Texas, of which State she was a national, and, what is more, as already stated,
Hodges made official and sworn statements or manifestations indicating that as far as he was concerned
no “property interests passed to him as surviving spouse — “except for purposes of administering the
estate, paying debts, taxes and other legal charges” and it was the intention of the surviving husband of
the deceased to distribute the remaining property and interests of the deceased in their Community
Estate to the devisees and legatees named in the will when the debts, liabilities, taxes and expenses of
administration are finally determined and paid”, that the incidents and controversies now before Us for
resolution arose. As may be observed, the situation that ensued upon the death of Hodges became rather
unusual and so, quite understandably, the lower court’s actuations presently under review are apparently
wanting in consistency and seemingly lack proper orientation.

Thus, We cannot discern clearly from the record before Us the precise perspective from which the trial
court proceeded in issuing its questioned orders. And, regretably, none of the lengthy briefs submitted by
the parties is of valuable assistance in clearing up the matter.

To begin with, We gather from the two records on appeal filed by petitioner, as appellant in the appealed
cases, one with green cover and the other with a yellow cover, that at the outset, a sort of modus
operandi had been agreed upon by the parties under which the respective administrators of the two
estates were supposed to act conjointly, but since no copy of the said agreement can be found in the
record before Us, We have no way of knowing when exactly such agreement was entered into and under
what specific terms. And while reference is made to said modus operandi in the order of September 11,
1964, on pages 205-206 of the Green Record on Appeal, reading thus:
The present incident is to hear the side of administratrix, Miss Avelina A. Magno, in answer to the charges
contained in the motion filed by Atty. Cesar Tirol on September 3, 1964. In answer to the said charges,
Miss Avelina A. Magno, through her counsel, Atty. Rizal Quimpo, filed a written manifestation.

After reading the manifestation here of Atty. Quimpo, for and in behalf of the administratrix, Miss Avelina
A. Magno, the Court finds that everything that happened before September 3, 1964, which was resolved
on September 8, 1964, to the satisfaction of parties, was simply due to a misunderstanding between the
representative of the Philippine Commercial and Industrial Bank and Miss Magno and in order to restore
the harmonious relations between the parties, the Court ordered the parties to remain in status quo as to
their modus operandi before September 1, 1964, until after the Court can have a meeting with all the
parties and their counsels on October 3, as formerly agreed upon between counsels, Attys. Ozaeta,
Gibbs and Ozaeta, Attys. Tirol and Tirol and Atty. Rizal Quimpo.
In the meantime, the prayers of Atty. Quimpo as stated in his manifestation shall not be resolved by this
Court until October 3, 1964.

SO ORDERED.

there is nothing in the record indicating whatever happened to it afterwards, except that again, reference
thereto was made in the appealed order of October 27, 1965, on pages 292-295 of the Green Record on
Appeal, as follows:

On record is an urgent motion to allow PCIB to open all doors and locks in the Hodges Office at 206-208
Guanco Street, Iloilo City, to take immediate and exclusive possession thereof and to place its own locks
and keys for security purposes of the PCIB dated October 27, 1965 thru Atty. Cesar Tirol. It is alleged in
said urgent motion that Administratrix Magno of the testate estate of Linnie Jane Hodges refused to open
the Hodges Office at 206-208 Guanco Street, Iloilo City where PCIB holds office and therefore PCIB is
suffering great moral damage and prejudice as a result of said act. It is prayed that an order be issued
authorizing it (PCIB) to open all doors and locks in the said office, to take immediate and exclusive
possession thereof and place thereon its own locks and keys for security purposes; instructing the clerk of
court or any available deputy to witness and supervise the opening of all doors and locks and taking
possession of the PCIB.

A written opposition has been filed by Administratrix Magno of even date (Oct. 27) thru counsel Rizal
Quimpo stating therein that she was compelled to close the office for the reason that the PCIB failed to
comply with the order of this Court signed by Judge Anacleto I. Bellosillo dated September 11, 1964 to
the effect that both estates should remain in status quo to their modus operandi as of September 1, 1964.
To arrive at a happy solution of the dispute and in order not to interrupt the operation of the office of both
estates, the Court aside from the reasons stated in the urgent motion and opposition heard the verbal
arguments of Atty. Cesar Tirol for the PCIB and Atty. Rizal Quimpo for Administratix Magno.

After due consideration, the Court hereby orders Magno to open all doors and locks in the Hodges Office
at 206-208 Guanco Street, Iloilo City in the presence of the PCIB or its duly authorized representative and
deputy clerk of court Albis of this branch not later than 7:30 tomorrow morning October 28, 1965 in order
that the office of said estates could operate for business.

Pursuant to the order of this Court thru Judge Bellosillo dated September 11, 1964, it is hereby ordered:

(a) That all cash collections should be deposited in the joint account of the estates of Linnie Jane Hodges
and estates of C.N. Hodges;

(b) That whatever cash collections that had been deposited in the account of either of the estates should
be withdrawn and since then deposited in the joint account of the estate of Linnie Jane Hodges and the
estate of C.N. Hodges;
(c) That the PCIB should countersign the check in the amount of P250 in favor of Administratrix Avelina A.
Magno as her compensation as administratrix of the Linnie Jane Hodges estate chargeable to the testate
estate of Linnie Jane Hodges only;

(d) That Administratrix Magno is hereby directed to allow the PCIB to inspect whatever records,
documents and papers she may have in her possession in the same manner that Administrator PCIB is
also directed to allow Administratrix Magno to inspect whatever records, documents and papers it may
have in its possession;

(e) That the accountant of the estate of Linnie Jane Hodges shall have access to all records of the
transactions of both estates for the protection of the estate of Linnie Jane Hodges; and in like manner the
accountant or any authorized representative of the estate of C.N. Hodges shall have access to the
records of transactions of the Linnie Jane Hodges estate for the protection of the estate of C.N. Hodges.

Once the estates’ office shall have been opened by Administratrix Magno in the presence of the PCIB or
its duly authorized representative and deputy clerk Albis or his duly authorized representative, both
estates or any of the estates should not close it without previous consent and authority from this court.

SO ORDERED.

As may be noted, in this order, the respondent court required that all collections from the properties in the
name of Hodges should be deposited in a joint account of the two estates, which indicates that seemingly
the so-called modus operandi was no longer operative, but again there is nothing to show when this
situation started.
Likewise, in paragraph 3 of the petitioner’s motion of September 14, 1964, on pages 188-201 of the
Green Record on Appeal, (also found on pp. 83-91 of the Yellow Record on Appeal) it is alleged that:

3. On January 24, 1964 virtually all of the heirs of C.N. Hodges, Joe Hodges and Fernando P. Mirasol
acting as the two co-administrators of the estate of C.N. Hodges, Avelina A. Magno acting as the
administratrix of the estate of Linnie Jane Hodges and Messrs. William Brown and Ardell Young acting for
all of the Higdon family who claim to be the sole beneficiaries of the estate of Linnie Jane Hodges and
various legal counsel representing the aforementioned parties entered into an amicable agreement, which
was approved by this Honorable Court, wherein the parties thereto agreed that certain sums of money
were to be paid in settlement of different claims against the two estates and that the assets (to the extent
they existed) of both estates would be administered jointly by the PCIB as administrator of the estate of
C.N. Hodges and Avelina A. Magno as administratrix of the estate of Linnie Jane Hodges, subject,
however, to the aforesaid October 5, 1963 Motion, namely, the PCIB’s claim to exclusive possession and
ownership of one hundred percent (100%) (or, in the alternative, seventy-five percent (75%) of all assets
owned by C.N. Hodges or Linnie Jane Hodges situated in the Philippines. On February 1, 1964 (pp. 934-
935, CFI Rec., S.P. No. 1672) this Honorable Court amended its order of January 24, 1964 but in no way
changed its recognition of the afore-described basic demand by the PCIB as administrator of the estate of
C.N. Hodges to one hundred percent (100%) of the assets claimed by both estates.
but no copy of the mentioned agreement of joint administration of the two estates exists in the record, and
so, We are not informed as to what exactly are the terms of the same which could be relevant in the
resolution of the issues herein.

On the other hand, the appealed order of November 3, 1965, on pages 313-320 of the Green Record on
Appeal, authorized payment by respondent Magno of, inter alia, her own fees as administratrix, the
attorney’s fees of her lawyers, etc., as follows:
Administratrix Magno thru Attys. Raul S. Manglapus and Rizal. R. Quimpo filed a Manifestation and
Urgent Motion dated June 10, 1964 asking for the approval of the Agreement dated June 6, 1964 which
Agreement is for the purpose of retaining their services to protect and defend the interest of the said
Administratrix in these proceedings and the same has been signed by and bears the express conformity
of the attorney-in-fact of the late Linnie Jane Hodges, Mr. James L. Sullivan. It is further prayed that the
Administratrix of the Testate Estate of Linnie Jane Hodges be directed to pay the retailers fee of said
lawyers, said fees made chargeable as expenses for the administration of the estate of Linnie Jane
Hodges (pp. 1641-1642, Vol. V, Sp. 1307).

An opposition has been filed by the Administrator PCIB thru Atty. Herminio Ozaeta dated July 11, 1964,
on the ground that payment of the retainers fee of Attys. Manglapus and Quimpo as prayed for in said
Manifestation and Urgent Motion is prejudicial to the 100% claim of the estate of C. N. Hodges;
employment of Attys. Manglapus and Quimpo is premature and/or unnecessary; Attys. Quimpo and
Manglapus are representing conflicting interests and the estate of Linnie Jane Hodges should be closed
and terminated (pp. 1679-1684, Vol, V, Sp. 1307).

Atty. Leon P. Gellada filed a memorandum dated July 28, 1964 asking that the Manifestation and Urgent
Motion filed by Attys. Manglapus and Quimpo be denied because no evidence has been presented in
support thereof. Atty. Manglapus filed a reply to the opposition of counsel for the Administrator of the C.
N. Hodges estate wherein it is claimed that expenses of administration include reasonable counsel or
attorney’s fees for services to the executor or administrator. As a matter of fact the fee agreement dated
February 27, 1964 between the PCIB and the law firm of Ozaeta, Gibbs & Ozaeta as its counsel (Pp.
1280-1284, Vol. V, Sp. 1307) which stipulates the fees for said law firm has been approved by the Court
in its order dated March 31, 1964. If payment of the fees of the lawyers for the administratrix of the estate
of Linnie Jane Hodges will cause prejudice to the estate of C. N. Hodges, in like manner the very
agreement which provides for the payment of attorney’s fees to the counsel for the PCIB will also be
prejudicial to the estate of Linnie Jane Hodges (pp. 1801-1814, Vol. V, Sp. 1307).

Atty. Herminio Ozaeta filed a rejoinder dated August 10, 1964 to the reply to the opposition to the
Manifestation and Urgent Motion alleging principally that the estates of Linnie Jane Hodges and C. N.
Hodges are not similarly situated for the reason that C. N. Hodges is an heir of Linnie Jane Hodges
whereas the latter is not an heir of the former for the reason that Linnie Jane Hodges predeceased C. N.
Hodges (pp. 1839-1848, Vol. V, Sp. 1307); that Attys. Manglapus and Quimpo formally entered their
appearance in behalf of Administratrix of the estate of Linnie Jane Hodges on June 10, 1964 (pp. 1639-
1640, Vol. V, Sp. 1307).

Atty. Manglapus filed a manifestation dated December 18, 1964 stating therein that Judge Bellosillo
issued an order requiring the parties to submit memorandum in support of their respective contentions. It
is prayed in this manifestation that the Manifestation and Urgent Motion dated June 10, 1964 be resolved
(pp. 6435-6439, Vol. VII, Sp. 1307).

Atty. Roman Mabanta, Jr. for the PCIB filed a counter- manifestation dated January 5, 1965 asking that
after the consideration by the court of all allegations and arguments and pleadings of the PCIB in
connection therewith (1) said manifestation and urgent motion of Attys. Manglapus and Quimpo be denied
(pp. 6442-6453, Vol. VII, Sp. 1307). Judge Querubin issued an order dated January 4, 1965 approving
the motion dated June 10, 1964 of the attorneys for the administratrix of the estate of Linnie Jane Hodges
and agreement annexed to said motion. The said order further states: “The Administratrix of the estate of
Linnie Jane Hodges is authorized to issue or sign whatever check or checks may be necessary for the
above purpose and the administrator of the estate of C. N. Hodges is ordered to countersign the same.
(pp. 6518-6523, Vol VII, Sp. 1307).

Atty. Roman Mabanta, Jr. for the PCIB filed a manifestation and motion dated January 13, 1965 asking
that the order of January 4, 1965 which was issued by Judge Querubin be declared null and void and to
enjoin the clerk of court and the administratrix and administrator in these special proceedings from all
proceedings and action to enforce or comply with the provision of the aforesaid order of January 4, 1965.
In support of said manifestation and motion it is alleged that the order of January 4, 1965 is null and void
because the said order was never delivered to the deputy clerk Albis of Branch V (the sala of Judge
Querubin) and the alleged order was found in the drawer of the late Judge Querubin in his office when
said drawer was opened on January 13, 1965 after the death of Judge Querubin by Perfecto Querubin,
Jr., the son of the judge and in the presence of Executive Judge Rovira and deputy clerk Albis (Sec. 1,
Rule 36, New Civil Code) (Pp. 6600-6606, Vol. VIII, Sp. 1307).

Atty. Roman Mabanta, Jr. for the PCIB filed a motion for reconsideration dated February 23, 1965 asking
that the order dated January 4, 1964 be reversed on the ground that:

1. Attorneys retained must render services to the estate not to the personal heir;

2. If services are rendered to both, fees should be pro-rated between them;

3. Attorneys retained should not represent conflicting interests; to the prejudice of the other heirs not
represented by said attorneys;

4. Fees must be commensurate to the actual services rendered to the estate;

5. There must be assets in the estate to pay for said fees (Pp. 6625-6636, Vol. VIII, Sp. 1307).
Atty. Quimpo for Administratrix Magno of the estate of Linnie Jane Hodges filed a motion to submit dated
July 15, 1965 asking that the manifestation and urgent motion dated June 10, 1964 filed by Attys.
Manglapus and Quimpo and other incidents directly appertaining thereto be considered submitted for
consideration and approval (pp. 6759-6765, Vol. VIII, Sp. 1307).

Considering the arguments and reasons in support to the pleadings of both the Administratrix and the
PCIB, and of Atty. Gellada, hereinbefore mentioned, the Court believes that the order of January 4, 1965
is null and void for the reason that the said order has not been filed with deputy clerk Albis of this court
(Branch V) during the lifetime of Judge Querubin who signed the said order. However, the said
manifestation and urgent motion dated June 10, 1964 is being treated and considered in this instant
order. It is worthy to note that in the motion dated January 24, 1964 (Pp. 1149- 1163, Vol. V, Sp. 1307)
which has been filed by Atty. Gellada and his associates and Atty. Gibbs and other lawyers in addition to
the stipulated fees for actual services rendered. However, the fee agreement dated February 27, 1964,
between the Administrator of the estate of C. N. Hodges and Atty. Gibbs which provides for retainer fee of
P4,000 monthly in addition to specific fees for actual appearances, reimbursement for expenditures and
contingent fees has also been approved by the Court and said lawyers have already been paid. (pp.
1273-1279, Vol. V, Sp. Proc. 1307 pp. 1372-1373, Vol. V, Sp. Proc. 1307).

WHEREFORE, the order dated January 4, 1965 is hereby declared null and void.

The manifestation and motion dated June 10, 1964 which was filed by the attorneys for the administratrix
of the testate estate of Linnie Jane Hodges is granted and the agreement annexed thereto is hereby
approved.

The administratrix of the estate of Linnie Jane Hodges is hereby directed to be needed to implement the
approval of the agreement annexed to the motion and the administrator of the estate of C. N. Hodges is
directed to countersign the said check or checks as the case may be.

SO ORDERED.

thereby implying somehow that the court assumed the existence of independent but simultaneous
administrations.

Be that as it may, again, it appears that on August 6, 1965, the court, acting on a motion of petitioner for
the approval of deeds of sale executed by it as administrator of the estate of Hodges, issued the following
order, also on appeal herein:

Acting upon the motion for approval of deeds of sale for registered land of the PCIB, Administrator of the
Testate Estate of C. N. Hodges in Sp. Proc. 1672 (Vol. VII, pp. 2244-2245), dated July 16, 1965, filed by
Atty. Cesar T. Tirol in representation of the law firms of Ozaeta, Gibbs and Ozaeta and Tirol and Tirol and
the opposition thereto of Atty. Rizal R. Quimpo (Vol. VIII, pp. 6811-6813) dated July 22, 1965 and
considering the allegations and reasons therein stated, the court believes that the deeds of sale should be
signed jointly by the PCIB, Administrator of the Testate Estate of C. N. Hodges and Avelina A. Magno,
Administratrix of the Testate Estate of Linnie Jane Hodges and to this effect the PCIB should take the
necessary steps so that Administratrix Avelina A. Magno could sign the deeds of sale.

SO ORDERED. (p. 248, Green Record on Appeal.)

Notably this order required that even the deeds executed by petitioner, as administrator of the Estate of
Hodges, involving properties registered in his name, should be co-signed by respondent Magno. 3And this
was not an isolated instance.
In her brief as appellee, respondent Magno states:

After the lower court had authorized appellee Avelina A. Magno to execute final deeds of sale pursuant to
contracts to sell executed by C. N. Hodges on February 20, 1963 (pp. 45-46, Green ROA), motions for
the approval of final deeds of sale (signed by appellee Avelina A. Magno and the administrator of the
estate of C. N. Hodges, first Joe Hodges, then Atty. Fernando Mirasol and later the appellant) were
approved by the lower court upon petition of appellee Magno’s counsel, Atty. Leon P. Gellada, on the
basis of section 8 of Rule 89 of the Revised Rules of Court. Subsequently, the appellant, after it had taken
over the bulk of the assets of the two estates, started presenting these motions itself. The first such
attempt was a “Motion for Approval of Deeds of Sale for Registered Land and Cancellations of
Mortgages” dated July 21, 1964 filed by Atty. Cesar T. Tirol, counsel for the appellant, thereto annexing
two (2) final deeds of sale and two (2) cancellations of mortgages signed by appellee Avelina A. Magno
and D. R. Paulino, Assistant Vice-President and Manager of the appellant (CFI Record, Sp. Proc. No.
1307, Vol. V, pp. 1694-1701). This motion was approved by the lower court on July 27, 1964. It was
followed by another motion dated August 4, 1964 for the approval of one final deed of sale again signed
by appellee Avelina A. Magno and D. R. Paulino (CFI Record, Sp. Proc. No. 1307. Vol. V, pp. 1825-
1828), which was again approved by the lower court on August 7, 1964. The gates having been opened,
a flood ensued: the appellant subsequently filed similar motions for the approval of a multitude of deeds of
sales and cancellations of mortgages signed by both the appellee Avelina A. Magno and the appellant.

A random check of the records of Special Proceeding No. 1307 alone will show Atty. Cesar T. Tirol as
having presented for court approval deeds of sale of real properties signed by both appellee Avelina A.
Magno and D. R. Paulino in the following numbers: (a) motion dated September 21, 1964 — 6 deeds of
sale; (b) motion dated November 4, 1964 — 1 deed of sale; (c) motion dated December 1, 1964 — 4
deeds of sale; (d) motion dated February 3, 1965 — 8 deeds of sale; (f) motion dated May 7, 1965 — 9
deeds of sale. In view of the very extensive landholdings of the Hodges spouses and the many motions
filed concerning deeds of sale of real properties executed by C. N. Hodges the lower court has had to
constitute special separate expedientes in Special Proceedings Nos. 1307 and 1672 to include mere
motions for the approval of deeds of sale of the conjugal properties of the Hodges spouses.

As an example, from among the very many, under date of February 3, 1965, Atty. Cesar T. Tirol, as
counsel for the appellant, filed “Motion for Approval of Deeds of Sale for Registered Land and
Cancellations of Mortgages” (CFI Record, Sp. Proc. No. 1307, Vol. VIII, pp. 6570-6596) the allegations of
which read:

“1. In his lifetime, the late C. N. Hodges executed “Contracts to Sell” real property, and the prospective
buyers under said contracts have already paid the price and complied with the terms and conditions
thereof;

“2. In the course of administration of both estates, mortgage debtors have already paid their debts
secured by chattel mortgages in favor of the late C. N. Hodges, and are now entitled to release therefrom;

“3. There are attached hereto documents executed jointly by the Administratrix in Sp. Proc. No. 1307 and
the Administrator in Sp. Proc. No. 1672, consisting of deeds of sale in favor —

Fernando Cano, Bacolod City, Occ. Negros

Fe Magbanua, Iloilo City
Policarpio M. Pareno, La Paz, Iloilo City
Rosario T. Libre, Jaro, Iloilo City
Federico B. Torres, Iloilo City
Reynaldo T. Lataquin, La Paz, Iloilo City
Anatolio T. Viray, Iloilo City
Benjamin Rolando, Jaro, Iloilo City

and cancellations of mortgages in favor of —

Pablo Manzano, Oton, Iloilo

Ricardo M. Diana, Dao, San Jose, Antique
Simplicio Tingson, Iloilo City
Amado Magbanua, Pototan, Iloilo
Roselia M. Baes, Bolo, Roxas City
William Bayani, Rizal Estanzuela, Iloilo City
Elpidio Villarete, Molo, Iloilo City
Norma T. Ruiz, Jaro, Iloilo City

“4. That the approval of the aforesaid documents will not reduce the assets of the estates so as to prevent
any creditor from receiving his full debt or diminish his dividend.”

And the prayer of this motion is indeed very revealing:

“WHEREFORE, it is respectfully prayed that, under Rule 89, Section 8 of the Rules of Court, this
honorable court approve the aforesaid deeds of sale and cancellations of mortgages.” (Pp. 113-117,
Appellee’s Brief.)

None of these assertions is denied in Petitioner’s reply brief.

Further indicating lack of concrete perspective or orientation on the part of the respondent court and its
hesitancy to clear up matters promptly, in its other appealed order of November 23, 1965, on pages 334-
335 of the Green Record on Appeal, said respondent court allowed the movant Ricardo Salas, President
of appellee Western Institute of Technology (successor of Panay Educational Institutions, Inc.), one of the
parties with whom Hodges had contracts that are in question in the appeals herein, to pay petitioner, as
Administrator of the estate of Hodges and/or respondent Magno, as Administrator of the estate of Mrs.
Hodges, thus:

Considering that in both cases there is as yet no judicial declaration of heirs nor distribution of properties
to whomsoever are entitled thereto, the Court believes that payment to both the administrator of the
testate estate of C. N. Hodges and the administratrix of the testate estate of Linnie Jane Hodges or to
either one of the two estates is proper and legal.

WHEREFORE, movant Ricardo T. Salas can pay to both estates or either of them.

SO ORDERED.

(Pp. 334-335, Green Record on Appeal.)

On the other hand, as stated earlier, there were instances when respondent Magno was given authority to
act alone. For instance, in the other appealed order of December 19, 1964, on page 221 of the Green
Record on Appeal, the respondent court approved payments made by her of overtime pay to some
employees of the court who had helped in gathering and preparing copies of parts of the records in both
estates as follows:

Considering that the expenses subject of the motion to approve payment of overtime pay dated
December 10, 1964, are reasonable and are believed by this Court to be a proper charge of
administration chargeable to the testate estate of the late Linnie Jane Hodges, the said expenses are
hereby APPROVED and to be charged against the testate estate of the late Linnie Jane Hodges. The
administrator of the testate estate of the late Charles Newton Hodges is hereby ordered to countersign
the check or checks necessary to pay the said overtime pay as shown by the bills marked Annex “A”, “B”
and “C” of the motion.

SO ORDERED.

(Pp. 221-222, Green Record on Appeal.)

Likewise, the respondent court approved deeds of sale executed by respondent Magno alone, as
Administratrix of the estate of Mrs. Hodges, covering properties in the name of Hodges, pursuant to
“contracts to sell” executed by Hodges, irrespective of whether they were executed by him before or after
the death of his wife. The orders of this nature which are also on appeal herein are the following:
1. Order of March 30, 1966, on p. 137 of the Green Record on Appeal, approving the deed of sale
executed by respondent Magno in favor of appellee Lorenzo Carles on February 24, 1966, pursuant to a
“contract to sell” signed by Hodges on June 17, 1958, after the death of his wife, which contract petitioner
claims was cancelled by it for failure of Carles to pay the installments due on January 7, 1965.

2. Order of April 5, 1966, on pp. 139-140, id., approving the deed of sale executed by respondent Magno
in favor of appellee Salvador Guzman on February 28, 1966 pursuant to a “contract to sell” signed by
Hodges on September 13, 1960, after the death of his wife, which contract petitioner claims it cancelled
on March 3, 1965 in view of failure of said appellee to pay the installments on time.
3. Order of April 20, 1966, on pp. 167-168, id., approving the deed of sale executed by respondent Magno
in favor of appellee Purificacion Coronado on March 28, 1966 pursuant to a “contract to sell” signed by
Hodges on August 14, 1961, after the death of his wife.
4. Order of April 20, 1966, on pp. 168-169, id., approving the deed of sale executed by respondent Magno
in favor of appellee Florenia Barrido on March 28, 1966, pursuant to a “contract to sell” signed by Hodges
on February 21, 1958, after the death of his wife.
5. Order of June 7, 1966, on pp. 184-185, id., approving the deed of sale executed by respondent Magno
in favor of appellee Belcezar Causing on May 2, 1966, pursuant to a “contract to sell” signed by Hodges
on February 10, 1959, after the death of his wife.
6. Order of June 21, 1966, on pp. 211-212, id., approving the deed of sale executed by respondent
Magno in favor of appellee Artheo Thomas Jamir on June 3, 1966, pursuant to a “contract to sell” signed
by Hodges on May 26, 1961, after the death of his wife.
7. Order of June 21, 1966, on pp. 212-213, id., approving the deed of sale executed by respondent
Magno in favor of appellees Graciano Lucero and Melquiades Batisanan on June 6 and June 3, 1966,
respectively, pursuant to “contracts to sell” signed by Hodges on June 9, 1959 and November 27, 1961,
respectively, after the death of his wife.
8. Order of December 2, 1966, on pp. 303-304, id., approving the deed of sale executed by respondent
Magno in favor of appellees Espiridion Partisala, Winifredo Espada and Rosario Alingasa on September
6, 1966, August 17, 1966 and August 3, 1966, respectively, pursuant to “contracts to sell” signed by
Hodges on April 20, 1960, April 18, 1960 and August 25, 1958, respectively, that is, after the death of his
wife.
9. Order of April 5, 1966, on pp. 137-138, id., approving the deed of sale executed by respondent Magno
in favor of appellee Alfredo Catedral on March 2, 1966, pursuant to a “contract to sell” signed by Hodges
on May 29, 1954, before the death of his wife, which contract petitioner claims it had cancelled on
February 16, 1966 for failure of appellee Catedral to pay the installments due on time.
10. Order of April 5, 1966, on pp. 138-139, id., approving the deed of sale executed by respondent Magno
in favor of appellee Jose Pablico on March 7, 1966, pursuant to a “contract to sell” signed by Hodges on
March 7, 1950, after the death of his wife, which contract petitioner claims it had cancelled on June 29,
1960, for failure of appellee Pablico to pay the installments due on time.
11. Order of December 2, 1966, on pp. 303-304, id., insofar as it approved the deed of sale executed by
respondent Magno in favor of appellee Pepito Iyulores on September 6, 1966, pursuant to a “contract to
sell” signed by Hodges on February 5, 1951, before the death of his wife.
12. Order of January 3, 1967, on pp. 335-336, id., approving three deeds of sale executed by respondent
Magno, one in favor of appellees Santiago Pacaonsis and two in favor of appellee Adelfa Premaylon on
December 5, 1966 and November 3, 1966, respectively, pursuant to separate “promises to sell” signed
respectively by Hodges on May 26, 1955 and January 30, 1954, before the death of his wife, and October
31, 1959, after her death.
In like manner, there were also instances when respondent court approved deeds of sale executed by
petitioner alone and without the concurrence of respondent Magno, and such approvals have not been
the subject of any appeal. No less than petitioner points this out on pages 149-150 of its brief as appellant
thus:

The points of fact and law pertaining to the two abovecited assignments of error have already been
discussed previously. In the first abovecited error, the order alluded to was general, and as already
explained before, it was, as admitted by the lower court itself, superseded by the particular orders
approving specific final deeds of sale executed by the appellee, Avelina A. Magno, which are subject of
this appeal, as well as the particular orders approving specific final deeds of sale executed by the
appellant, Philippine Commercial and Industrial Bank, which were never appealed by the appellee,
Avelina A. Magno, nor by any party for that matter, and which are now therefore final.

Now, simultaneously with the foregoing incidents, others of more fundamental and all embracing
significance developed. On October 5, 1963, over the signature of Atty. Allison J. Gibbs in representation
of the law firm of Ozaeta, Gibbs & Ozaeta, as counsel for the co-administrators Joe Hodges and
Fernando P. Mirasol, the following self-explanatory motion was filed:

URGENT MOTION FOR AN ACCOUNTING AND DELIVERY TO ADMINISTRATION OF THE ESTATE

OF C. N. HODGES OF ALL OF THE ASSETS OF THE CONJUGAL PARTNERSHIP OF THE
DECEASED LINNIE JANE HODGES AND C N. HODGES EXISTING AS OF MAY 23, 1957 PLUS ALL
THE RENTS, EMOLUMENTS AND INCOME THEREFROM.
COMES NOW the co-administrator of the estate of C. N. Hodges, Joe Hodges, through his undersigned
attorneys in the above-entitled proceedings, and to this Honorable Court respectfully alleges:

(1) On May 23, 1957 Linnie Jane Hodges died in Iloilo City.

(2) On June 28, 1957 this Honorable Court admitted to probate the Last Will and Testament of the
deceased Linnie Jane Hodges executed November 22, 1952 and appointed C. N. Hodges as Executor of
the estate of Linnie Jane Hodges (pp. 24-25, Rec. Sp. Proc. 1307).

(3) On July 1, 1957 this Honorable Court issued Letters Testamentary to C. N. Hodges in the Estate of
Linnie Jane Hodges (p. 30, Rec. Sp. Proc. 1307).

(4) On December 14, 1957 this Honorable Court, on the basis of the following allegations in a Motion
dated December 11, 1957 filed by Leon P. Gellada as attorney for the executor C. N. Hodges:
“That herein Executor, (is) not only part owner of the properties left as conjugal, but also, the successor to
all the properties left by the deceased Linnie Jane Hodges.”
(p. 44, Rec. Sp. Proc. 1307; emphasis supplied.)

issued the following order:

“As prayed for by Attorney Gellada, counsel for the Executory, for the reasons stated in his motion dated
December 11, 1957 which the court considers well taken, all the sales, conveyances, leases and
mortgages of all properties left by the deceased Linnie Jane Hodges are hereby APPROVED. The said
executor is further authorized to execute subsequent sales, conveyances, leases and mortgages of the
properties left by the said deceased Linnie Jane Hodges in consonance with the wishes contained in the
last will and testament of the latter.”
(p. 46, Rec. Sp. Proc. 1307; emphasis supplied.)

(5) On April 21, 1959 this Honorable Court approved the inventory and accounting submitted by C. N.
Hodges through his counsel Leon P. Gellada on April 14, 1959 wherein he alleged among other things

“That no person interested in the Philippines of the time and place of examining the herein account, be
given notice, as herein executor is the only devisee or legatee of the deceased, in accordance with the
last will and testament already probated by the Honorable Court.”
(pp. 77-78, Rec. Sp. Proc. 1307; emphasis supplied.).

(6) On July 30, 1960 this Honorable Court approved the “Annual Statement of Account” submitted by C.
N. Hodges through his counsel Leon P. Gellada on July 21, 1960 wherein he alleged among other things:

“That no person interested in the Philippines of the time and place of examining the herein account, be
given notice as herein executor is the only devisee or legatee of the deceased Linnie Jane Hodges , in
accordance with the last will and testament of the deceased, already probated by this Honorable Court.”
(pp. 81-82. Rec. Sp. Proc. 1307; emphasis supplied.)

(7) On May 2, 1961 this Honorable court approved the “Annual Statement of Account By The Executor for
the Year 1960″ submitted through Leon P. Gellada on April 20, 1961 wherein he alleged:

That no person interested in the Philippines be given notice, of the time and place of examining the herein
account, as herein Executor is the only devisee or legatee of the deceased Linnie Jane Hodges, in
accordance with the last will and testament of the deceased, already probated by this Honorable Court.
(pp. 90-91. Rec. Sp. Proc. 1307; emphasis supplied.)

(8) On December 25, 1962, C.N. Hodges died.

(9) On December 25, 1962, on the Urgent Ex-parte Motion of Leon P. Gellada filed only in Special
Proceeding No. 1307, this Honorable Court appointed Avelina A. Magno
“Administratrix of the estate of Linnie Jane Hodges and as Special Administratrix of the estate of Charles
Newton Hodges, in the latter case, because the last will of said Charles Newton Hodges is still kept in his
vault or iron safe and that the real and personal properties of both spouses may be lost, damaged or go to
waste, unless a Special Administratrix is appointed.”

(p. 100. Rec. Sp. Proc. 1307)

(10) On December 26, 1962 Letters of Administration were issued to Avelina Magno pursuant to this
Honorable Court’s aforesaid Order of December 25, 1962

“With full authority to take possession of all the property of said deceased in any province or provinces in
which it may be situated and to perform all other acts necessary for the preservation of said property, said
Administratrix and/or Special Administratrix having filed a bond satisfactory to the Court.”

(p. 102, Rec. Sp. Proc. 1307)

(11) On January 22, 1963 this Honorable Court on petition of Leon P. Gellada of January 21, 1963 issued
Letters of Administration to:

(a) Avelina A. Magno as Administratrix of the estate of Linnie Jane Hodges;

(b) Avelina A. Magno as Special Administratrix of the Estate of Charles Newton Hodges; and

(c) Joe Hodges as Co-Special Administrator of the Estate of Charles Newton Hodges.

(p. 43, Rec. Sp. Proc. 1307)

(12) On February 20, 1963 this Honorable Court on the basis of a motion filed by Leon P. Gellada as legal
counsel on February 16, 1963 for Avelina A. Magno acting as Administratrix of the Estate of Charles
Newton Hodges (pp. 114-116, Sp. Proc. 1307) issued the following order:

“… se autoriza a aquella (Avelina A. Magno) a firmar escrituras de venta definitiva de propiedades

cubiertas por contratos para vender, firmados, en vida, por el finado Charles Newton Hodges, cada vez
que el precio estipulado en cada contrato este totalmente pagado. Se autoriza igualmente a la misma a
firmar escrituras de cancelacion de hipoteca tanto de bienes reales como personales cada vez que la
consideracion de cada hipoteca este totalmente pagada.

“Cada una de dichas escrituras que se otorguen debe ser sometida para la aprobacion de este Juzgado.”

(p. 117, Sp. Proc. 1307).

[Par 1 (c), Reply to Motion For Removal of Joe Hodges]

(13) On September l6, 1963 Leon P. Gellada, acting as attorney for Avelina A. Magno as Administratrix of
the estate of Linnie Jane Hodges, alleges:

3. — That since January, 1963, both estates of Linnie Jane Hodges and Charles Newton Hodges have
been receiving in full, payments for those “contracts to sell” entered into by C. N. Hodges during his
lifetime, and the purchasers have been demanding the execution of definite deeds of sale in their favor.

4. — That hereto attached are thirteen (13) copies deeds of sale executed by the Administratrix and by
the co-administrator (Fernando P. Mirasol) of the estate of Linnie Jane Hodges and Charles Newton
Hodges respectively, in compliance with the terms and conditions of the respective “contracts to sell”
executed by the parties thereto.”

(14) The properties involved in the aforesaid motion of September 16, 1963 are all registered in the name
of the deceased C. N. Hodges.

(15) Avelina A. Magno, it is alleged on information and belief, has been advertising in the newspaper in
Iloilo thusly:

For Sale

Testate Estate of Linnie Jane Hodges and Charles Newton Hodges.

All Real Estate or Personal Property will be sold on First Come First Served Basis.

Avelina A. Magno
Administratrix

(16) Avelina A. Magno, it is alleged on information and belief, has paid and still is paying sums of money
to sundry persons.

(17) Joe Hodges through the undersigned attorneys manifested during the hearings before this Honorable
Court on September 5 and 6, 1963 that the estate of C. N. Hodges was claiming all of the assets
belonging to the deceased spouses Linnie Jane Hodges and C. N. Hodges situated in Philippines
because of the aforesaid election by C. N. Hodges wherein he claimed and took possession as sole
owner of all of said assets during the administration of the estate of Linnie Jane Hodges on the ground
that he was the sole devisee and legatee under her Last Will and Testament.

(18) Avelina A. Magno has submitted no inventory and accounting of her administration as Administratrix
of the estate of Linnie Jane Hodges and Special Administratrix of the estate of C. N. Hodges. However,
from manifestations made by Avelina A. Magno and her legal counsel, Leon P. Gellada, there is no
question she will claim that at least fifty per cent (50%) of the conjugal assets of the deceased spouses
and the rents, emoluments and income therefrom belong to the Higdon family who are named in
paragraphs Fourth and Fifth of the Will of Linnie Jane Hodges (p. 5, Rec. Sp. Proc. 1307).
WHEREFORE, premises considered, movant respectfully prays that this Honorable Court, after due
hearing, order:

(1) Avelina A. Magno to submit an inventory and accounting of all of the funds, properties and assets of
any character belonging to the deceased Linnie Jane Hodges and C. N. Hodges which have come into
her possession, with full details of what she has done with them;

(2) Avelina A. Magno to turn over and deliver to the Administrator of the estate of C. N. Hodges all of the
funds, properties and assets of any character remaining in her possession;

(3) Pending this Honorable Court’s adjudication of the aforesaid issues, Avelina A. Magno to stop, unless
she first secures the conformity of Joe Hodges (or his duly authorized representative, such as the
undersigned attorneys) as the Co-administrator and attorney-in-fact of a majority of the beneficiaries of
the estate of C. N. Hodges:

(a) Advertising the sale and the sale of the properties of the estates:

(b) Employing personnel and paying them any compensation.

(4) Such other relief as this Honorable Court may deem just and equitable in the premises. (Annex “T”,
Petition.)

Almost a year thereafter, or on September 14, 1964, after the co-administrators Joe Hodges and
Fernando P. Mirasol were replaced by herein petitioner Philippine Commercial and Industrial Bank as
sole administrator, pursuant to an agreement of all the heirs of Hodges approved by the court, and
because the above motion of October 5, 1963 had not yet been heard due to the absence from the
country of Atty. Gibbs, petitioner filed the following:

MANIFESTATION AND MOTION, INCLUDING MOTION TO SET FOR HEARING AND RESOLVE
“URGENT MOTION FOR AN ACCOUNTING AND DELIVERY TO ADMINISTRATORS OF THE ESTATE
OF C. N. HODGES OF ALL THE ASSETS OF THE CONJUGAL PARTNERSHIP OF THE DECEASED
LINNIE JANE HODGES AND C. N. HODGES EXISTING AS OF MAY 23, 1957 PLUS ALL OF THE
RENTS, EMOLUMENTS AND INCOME THEREFROM OF OCTOBER 5, 1963.
COMES NOW Philippine Commercial and Industrial Bank (hereinafter referred to as PCIB), the
administrator of the estate of C. N. Hodges, deceased, in Special Proceedings No. 1672, through its
undersigned counsel, and to this Honorable Court respectfully alleges that:

1. On October 5, 1963, Joe Hodges acting as the co-administrator of the estate of C. N. Hodges filed,
through the undersigned attorneys, an “Urgent Motion For An Accounting and Delivery To Administrator
of the Estate of C. N. Hodges of all Of The Assets Of The Conjugal Partnership of The Deceased Linnie
Jane Hodges and C. N. Hodges Existing as Of May, 23, 1957 Plus All Of The Rents, Emoluments and
Income Therefrom” (pp. 536-542, CFI Rec. S. P. No. 1672).
2. On January 24, 1964 this Honorable Court, on the basis of an amicable agreement entered into on
January 23, 1964 by the two co-administrators of the estate of C. N. Hodges and virtually all of the heirs
of C. N. Hodges (p. 912, CFI Rec., S. P. No. 1672), resolved the dispute over who should act as
administrator of the estate of C. N. Hodges by appointing the PCIB as administrator of the estate of C. N.
Hodges (pp. 905-906, CFI Rec. S. P. No. 1672) and issuing letters of administration to the PCIB.

3. On January 24, 1964 virtually all of the heirs of C. N. Hodges, Joe Hodges and Fernando P. Mirasol
acting as the two co-administrators of the estate of C. N. Hodges, Avelina A. Magno acting as the
administratrix of the estate of Linnie Jane Hodges, and Messrs. William Brown and Ardel Young Acting for
all of the Higdon family who claim to be the sole beneficiaries of the estate of Linnie Jane Hodges and
various legal counsel representing the aforenamed parties entered into an amicable agreement, which
was approved by this Honorable Court, wherein the parties thereto agreed that certain sums of money
were to be paid in settlement of different claims against the two estates and that the assets (to the extent
they existed)of both estates would be administrated jointly by the PCIB as administrator of the estate of
C. N. Hodges and Avelina A. Magno as administratrix of the estate of Linnie Jane Hodges , subject,
however, to the aforesaid October 5, 1963 Motion, namely, the PCIB’s claim to exclusive possession and
ownership of one-hundred percent (10017,) (or, in the alternative, seventy-five percent [75%] of all assets
owned by C. N. Hodges or Linnie Jane Hodges situated in the Philippines. On February 1, 1964 (pp. 934-
935, CFI Rec., S. P. No. 1672) this Honorable Court amended its order of January 24, 1964 but in no way
changes its recognition of the aforedescribed basic demand by the PCIB as administrator of the estate of
C. N. Hodges to one hundred percent (100%) of the assets claimed by both estates.
4. On February 15, 1964 the PCIB filed a “Motion to Resolve” the aforesaid Motion of October 5, 1963.
This Honorable Court set for hearing on June 11, 1964 the Motion of October 5, 1963.

5. On June 11, 1964, because the undersigned Allison J. Gibbs was absent in the United States, this
Honorable Court ordered the indefinite postponement of the hearing of the Motion of October 5, 1963.

6. Since its appointment as administrator of the estate of C. N. Hodges the PCIB has not been able to
properly carry out its duties and obligations as administrator of the estate of C. N. Hodges because of the
following acts, among others, of Avelina A. Magno and those who claim to act for her as administratrix of
the estate of Linnie Jane Hodges:

(a) Avelina A. Magno illegally acts as if she is in exclusive control of all of the assets in the Philippines of
both estates including those claimed by the estate of C. N. Hodges as evidenced in part by her locking
the premises at 206-208 Guanco Street, Iloilo City on August 31, 1964 and refusing to reopen same until
ordered to do so by this Honorable Court on September 7, 1964.

(b) Avelina A. Magno illegally acts as though she alone may decide how the assets of the estate of C.N.
Hodges should be administered, who the PCIB shall employ and how much they may be paid as
evidenced in party by her refusal to sign checks issued by the PCIB payable to the undersigned counsel
pursuant to their fee agreement approved by this Honorable Court in its order dated March 31, 1964.
(c) Avelina A. Magno illegally gives access to and turns over possession of the records and assets of the
estate of C.N. Hodges to the attorney-in-fact of the Higdon Family, Mr. James L. Sullivan, as evidenced in
part by the cashing of his personal checks.

(d) Avelina A. Magno illegally refuses to execute checks prepared by the PCIB drawn to pay expenses of
the estate of C. N. Hodges as evidenced in part by the check drawn to reimburse the PCIB’s advance of
P48,445.50 to pay the 1964 income taxes reported due and payable by the estate of C.N. Hodges.

7. Under and pursuant to the orders of this Honorable Court, particularly those of January 24 and
February 1, 1964, and the mandate contained in its Letters of Administration issued on January 24, 1964
to the PCIB, it has

“full authority to take possession of all the property of the deceased C. N. Hodges

“and to perform all other acts necessary for the preservation of said property.” (p. 914, CFI Rec., S.P. No.
1672.)

8. As administrator of the estate of C. N. Hodges, the PCIB claims the right to the immediate exclusive
possession and control of all of the properties, accounts receivables, court cases, bank accounts and
other assets, including the documentary records evidencing same, which existed in the Philippines on the
date of C. N. Hodges’ death, December 25, 1962, and were in his possession and registered in his name
alone. The PCIB knows of no assets in the Philippines registered in the name of Linnie Jane Hodges, the
estate of Linnie Jane Hodges, or, C. N. Hodges, Executor of the Estate of Linnie Jane Hodges on
December 25, 1962. All of the assets of which the PCIB has knowledge are either registered in the name
of C. N. Hodges, alone or were derived therefrom since his death on December 25, 1962.

9. The PCIB as the current administrator of the estate of C. N. Hodges, deceased, succeeded to all of the
rights of the previously duly appointed administrators of the estate of C. N. Hodges, to wit:

(a) On December 25, 1962, date of C. N. Hodges’ death, this Honorable Court appointed Miss Avelina A.
Magno simultaneously as:

(i) Administratrix of the estate of Linnie Jane Hodges (p. 102, CFI Rec., S.P. No. 1307) to replace the
deceased C. N. Hodges who on May 28, 1957 was appointed Special Administrator (p. 13. CFI Rec. S.P.
No. 1307) and on July 1, 1957 Executor of the estate of Linnie Jane Hodges (p. 30, CFI Rec., S. P. No.
1307).

(ii) Special Administratrix of the estate of C. N. Hodges (p. 102, CFI Rec., S.P. No. 1307).
(b) On December 29, 1962 this Honorable Court appointed Harold K. Davies as co-special administrator
of the estate of C.N. Hodges along with Avelina A. Magno (pp. 108-111, CFI Rec., S. P. No. 1307).

(c) On January 22, 1963, with the conformity of Avelina A. Magno, Harold K. Davies resigned in favor of
Joe Hodges (pp. 35-36, CFI Rec., S.P. No. 1672) who thereupon was appointed on January 22, 1963 by
this Honorable Court as special co-administrator of the estate of C.N. Hodges (pp. 38-40 & 43, CFI Rec.
S.P. No. 1672) along with Miss Magno who at that time was still acting as special co-administratrix of the
estate of C. N. Hodges.

(d) On February 22, 1963, without objection on the part of Avelina A. Magno, this Honorable Court
appointed Joe Hodges and Fernando P. Mirasol as co-administrators of the estate of C.N. Hodges (pp.
76-78, 81 & 85, CFI Rec., S.P. No. 1672).

10. Miss Avelina A. Magno, pursuant to the orders of this Honorable Court of December 25, 1962, took
possession of all Philippine Assets now claimed by the two estates. Legally, Miss Magno could take
possession of the assets registered in the name of C. N. Hodges alone only in her capacity as Special
Administratrix of the Estate of C.N. Hodges. With the appointment by this Honorable Court on February
22, 1963 of Joe Hodges and Fernando P. Mirasol as the co-administrators of the estate of C.N. Hodges,
they legally were entitled to take over from Miss Magno the full and exclusive possession of all of the
assets of the estate of C.N. Hodges. With the appointment on January 24, 1964 of the PCIB as the sole
administrator of the estate of C.N. Hodges in substitution of Joe Hodges and Fernando P. Mirasol, the
PCIB legally became the only party entitled to the sole and exclusive possession of all of the assets of the
estate of C. N. Hodges.

11. The PCIB’s predecessors submitted their accounting and this Honorable Court approved same, to wit:

(a) The accounting of Harold K. Davies dated January 18, 1963 (pp. 16-33, CFI Rec. S.P. No. 1672);
which shows or its face the:

(i) Conformity of Avelina A. Magno acting as “Administratrix of the Estate of Linnie Jane Hodges and
Special Administratrix of the Estate of C. N. Hodges”;

(ii) Conformity of Leslie Echols, a Texas lawyer acting for the heirs of C.N. Hodges; and

(iii) Conformity of William Brown, a Texas lawyer acting for the Higdon family who claim to be the only
heirs of Linnie Jane Hodges (pp. 18, 25-33, CFI Rec., S. P. No. 1672).

Note: This accounting was approved by this Honorable Court on January 22, 1963 (p. 34, CFI Rec., S. P.
No. 1672).

(b) The accounting of Joe Hodges and Fernando P. Mirasol as of January 23, 1964, filed February 24,
1964 (pp. 990-1000, CFI Rec. S.P. No. 1672 and pp. 1806-1848, CFI Rec. S.P. No. 1307).

Note: This accounting was approved by this Honorable Court on March 3, 1964.

(c) The PCIB and its undersigned lawyers are aware of no report or accounting submitted by Avelina A.
Magno of her acts as administratrix of the estate of Linnie Jane Hodges or special administratrix of the
estate of C.N. Hodges, unless it is the accounting of Harold K. Davies as special co-administrator of the
estate of C.N. Hodges dated January 18, 1963 to which Miss Magno manifested her conformity (supra).
12. In the aforesaid agreement of January 24, 1964, Miss Avelina A. Magno agreed to receive
P10,000.00

“for her services as administratrix of the estate of Linnie Jane Hodges”

and in addition she agreed to be employed, starting February 1, 1964, at

“a monthly salary of P500.00 for her services as an employee of both estates.”

24 ems.

13. Under the aforesaid agreement of January 24, 1964 and the orders of this Honorable Court of same
date, the PCIB as administrator of the estate of C. N. Hodges is entitled to the exclusive possession of all
records, properties and assets in the name of C. N. Hodges as of the date of his death on December 25,
1962 which were in the possession of the deceased C. N. Hodges on that date and which then passed to
the possession of Miss Magno in her capacity as Special Co-Administratrix of the estate of C. N. Hodges
or the possession of Joe Hodges or Fernando P. Mirasol as co-administrators of the estate of C. N.
Hodges.

14. Because of Miss Magno’s refusal to comply with the reasonable request of PCIB concerning the
assets of the estate of C. N. Hodges, the PCIB dismissed Miss Magno as an employee of the estate of C.
N. Hodges effective August 31, 1964. On September 1, 1964 Miss Magno locked the premises at 206-
208 Guanco Street and denied the PCIB access thereto. Upon the Urgent Motion of the PCIB dated
September 3, 1964, this Honorable Court on September 7, 1964 ordered Miss Magno to reopen the
aforesaid premises at 206-208 Guanco Street and permit the PCIB access thereto no later than
September 8, 1964.

15. The PCIB pursuant to the aforesaid orders of this Honorable Court is again in physical possession of
all of the assets of the estate of C. N. Hodges. However, the PCIB is not in exclusive control of the
aforesaid records, properties and assets because Miss Magno continues to assert the claims hereinabove
outlined in paragraph 6, continues to use her own locks to the doors of the aforesaid premises at 206-208
Guanco Street, Iloilo City and continues to deny the PCIB its right to know the combinations to the doors
of the vault and safes situated within the premises at 206-208 Guanco Street despite the fact that said
combinations were known to only C. N. Hodges during his lifetime.

16. The Philippine estate and inheritance taxes assessed the estate of Linnie Jane Hodges were
assessed and paid on the basis that C. N. Hodges is the sole beneficiary of the assets of the estate of
Linnie Jane Hodges situated in the Philippines. Avelina A. Magno and her legal counsel at no time have
questioned the validity of the aforesaid assessment and the payment of the corresponding Philippine
death taxes.
17. Nothing further remains to be done in the estate of Linnie Jane Hodges except to resolve the
aforesaid Motion of October 5, 1963 and grant the PCIB the exclusive possession and control of all of the
records, properties and assets of the estate of C. N. Hodges.

18. Such assets as may have existed of the estate of Linnie Jane Hodges were ordered by this Honorable
Court in special Proceedings No. 1307 to be turned over and delivered to C. N. Hodges alone. He in fact
took possession of them before his death and asserted and exercised the right of exclusive ownership
over the said assets as the sole beneficiary of the estate of Linnie Jane Hodges.

WHEREFORE, premises considered, the PCIB respectfully petitions that this Honorable court:

(1) Set the Motion of October 5, 1963 for hearing at the earliest possible date with notice to all interested
parties;

(2) Order Avelina A. Magno to submit an inventory and accounting as Administratrix of the Estate of
Linnie Jane Hodges and Co-Administratrix of the Estate of C. N. Hodges of all of the funds, properties
and assets of any character belonging to the deceased Linnie Jane Hodges and C. N. Hodges which
have come into her possession, with full details of what she has done with them;

(3) Order Avelina A. Magno to turn over and deliver to the PCIB as administrator of the estate of C. N.
Hodges all of the funds, properties and assets of any character remaining in her possession;

(4) Pending this Honorable Court’s adjudication of the aforesaid issues, order Avelina A. Magno and her
representatives to stop interferring with the administration of the estate of C. N. Hodges by the PCIB and
its duly authorized representatives;

(5) Enjoin Avelina A. Magno from working in the premises at 206-208 Guanco Street, Iloilo City as an
employee of the estate of C. N. Hodges and approve her dismissal as such by the PCIB effective August
31, 1964;

(6) Enjoin James L. Sullivan, Attorneys Manglapus and Quimpo and others allegedly representing Miss
Magno from entering the premises at 206-208 Guanco Street, Iloilo City or any other properties of C. N.
Hodges without the express permission of the PCIB;

(7) Order such other relief as this Honorable Court finds just and equitable in the premises. (Annex “U”
Petition.)

On January 8, 1965, petitioner also filed a motion for “Official Declaration of Heirs of Linnie Jane Hodges
Estate” alleging:

COMES NOW Philippine Commercial and Industrial Bank (hereinafter referred to as PCIB), as
administrator of the estate of the late C. N. Hodges, through the undersigned counsel, and to this
Honorable Court respectfully alleges that:
1. During their marriage, spouses Charles Newton Hodges and Linnie Jane Hodges, American citizens
originally from the State of Texas, U.S.A., acquired and accumulated considerable assets and properties
in the Philippines and in the States of Texas and Oklahoma, United States of America. All said properties
constituted their conjugal estate.

2. Although Texas was the domicile of origin of the Hodges spouses, this Honorable Court, in its orders
dated March 31 and December 12, 1964 (CFI Record, Sp. Proc. No. 1307, pp. —-; Sp. Proc. No. 1672, p.
—-), conclusively found and categorically ruled that said spouses had lived and worked for more than 50
years in Iloilo City and had, therefore, acquired a domicile of choice in said city, which they retained until
the time of their respective deaths.

3. On November 22, 1952, Linnie Jane Hodges executed in the City of Iloilo her Last Will and Testament,
a copy of which is hereto attached as Annex “A”. The bequests in said will pertinent to the present issue
are the second, third, and fourth provisions, which we quote in full hereunder.
SECOND: I give, devise and bequeath all of the rest, residue and remainder of my estate, both personal
and real, wherever situated, or located, to my husband, Charles Newton Hodges, to have and to hold unto
him, my said husband during his natural lifetime.

THIRD: I desire, direct and provide that my husband, Charles Newton Hodges, shall have the right to
manage, control, use and enjoy said estate during his lifetime, and he is hereby given the right to make
any changes in the physical properties of said estate by sale of any part thereof which he think best, and
the purchase of any other or additional property as he may think best; to execute conveyances with or
without general or special warranty, conveying in fee simple or for any other term or time, any property
which he may deem proper to dispose of; to lease any of the real property for oil, gas and/or other
minerals, and all such deeds or leases shall pass the absolute fee simple title to the interest so conveyed
in such property as he may elect to sell. All rents, emoluments and income from said estate shall belong
to him, and he is further authorized to use any part of the principal of said estate as he may need or
desire. It is provided herein, however, that he shall not sell or otherwise dispose of any of the improved
property now owned by us located at, in or near the City of Lubbock, Texas, but he shall have the full right
to lease, manage and enjoy the same during his lifetime, as above provided. He shall have the right to
sub-divide any farmland and sell lots therein, and may sell unimproved town lots.

FOURTH: At the death of my said husband, Charles Newton Hodges, I give, devise and bequeath all of
the rest, residue and remainder of my estate both real and personal, wherever situated or located, to be
equally divided among my brothers and sisters, share and share alike, namely:

“Esta Higdon, Emma Howell, Leonard Higdon, Roy Higdon, Sadie Rascoe, Era Boman and Nimray
Higdon.”

4. On November 14, 1953, C. N. Hodges executed in the City of Iloilo his Last Will and Testament, a copy
of which is hereto attached as Annex “B “. In said Will, C. N. Hodges designated his wife, Linnie Jane
Hodges, as his beneficiary using the identical language she used in the second and third provisos of her
Will, supra.
5. On May 23, 1957 Linnie Jane Hodges died in Iloilo City, predeceasing her husband by more than five
(5) years. At the time of her death, she had no forced or compulsory heir, except her husband, C. N.
Hodges. She was survived also by various brothers and sisters mentioned in her Will (supra), which, for
convenience, we shall refer to as the HIGDONS.
6. On June 28, 1957, this Honorable Court admitted to probate the Last Will and Testament of the
deceased Linnie Jane Hodges (Annex “A”), and appointed C. N. Hodges as executor of her estate without
bond. (CFI Record, Sp. Proc. No. 1307, pp. 24-25). On July 1, 1957, this Honorable Court issued letters
testamentary to C. N. Hodges in the estate of Linnie Jane Hodges. (CFI Record, Sp. Proc. No. 1307, p.
30.)

7. The Will of Linnie Jane Hodges, with respect to the order of succession, the amount of successional
rights, and the intrinsic of its testamentary provisions, should be governed by Philippine laws because:

(a) The testatrix, Linnie Jane Hodges, intended Philippine laws to govern her Will;

(b) Article 16 of the Civil Code provides that “the national law of the person whose succession is under
consideration, whatever may be the nature of the property and regardless of the country wherein said
property may be found”, shall prevail. However, the Conflict of Law of Texas, which is the “national law” of
the testatrix, Linnie Jane Hodges, provide that the domiciliary law (Philippine law — see paragraph
2, supra) should govern the testamentary dispositions and successional rights over movables (personal
properties), and the law of the situs of the property (also Philippine law as to properties located in the
Philippines) with regards immovable (real properties). Thus applying the “Renvoi Doctrine”, as approved
and applied by our Supreme Court in the case of “In The Matter Of The Testate Estate of Eduard E.
Christensen”, G.R. No.
L-16749, promulgated January 31, 1963, Philippine law should apply to the Will of Linnie Jane Hodges
and to the successional rights to her estate insofar as her movable and immovable assets in the
Philippines are concerned. We shall not, at this stage, discuss what law should govern the assets of
Linnie Jane Hodges located in Oklahoma and Texas, because the only assets in issue in this motion are
those within the jurisdiction of this motion Court in the two above-captioned Special Proceedings.
8. Under Philippine and Texas law, the conjugal or community estate of spouses shall, upon dissolution,
be divided equally between them. Thus, upon the death of Linnie Jane Hodges on May 23, 1957, one-half
(1/2) of the entirety of the assets of the Hodges spouses constituting their conjugal estate pertained
automatically to Charles Newton Hodges, not by way of inheritance, but in his own right as partner in the
conjugal partnership. The other one-half (1/2) portion of the conjugal estate constituted the estate of
Linnie Jane Hodges. This is the only portion of the conjugal estate capable of inheritance by her heirs.
9. This one-half (1/2) portion of the conjugal assets pertaining to Linnie Jane Hodges cannot, under a
clear and specific provision of her Will, be enhanced or increased by income, earnings, rents, or
emoluments accruing after her death on May 23, 1957. Linnie Jane Hodges’ Will provides that “all rents,
emoluments and income from said estate shall belong to him (C. N. Hodges) and he is further authorized
to use any part of the principal of said estate as he may need or desire.” (Paragraph 3, Annex “A”.) Thus,
by specific provision of Linnie Jane Hodges’ Will, “all rents, emoluments and income” must be credited to
the one-half (1/2) portion of the conjugal estate pertaining to C. N. Hodges. Clearly, therefore, the estate
of Linnie Jane Hodges, capable of inheritance by her heirs, consisted exclusively of no more than one-
half (1/2) of the conjugal estate, computed as of the time of her death on May 23, 1957.
10. Articles 900, 995 and 1001 of the New Civil Code provide that the surviving spouse of a deceased
leaving no ascendants or descendants is entitled, as a matter of right and by way of irrevocable legitime,
to at least one-half (1/2) of the estate of the deceased, and no testamentary disposition by the deceased
can legally and validly affect this right of the surviving spouse. In fact, her husband is entitled to said one-
half (1/2) portion of her estate by way of legitime. (Article 886, Civil Code.) Clearly, therefore, immediately
upon the death of Linnie Jane Hodges, C. N. Hodges was the owner of at least three-fourths (3/4) or
seventy-five (75%) percent of all of the conjugal assets of the spouses, (1/2 or 50% by way of conjugal
partnership share and 1/4 or 25% by way of inheritance and legitime) plus all “rents, emoluments and
income” accruing to said conjugal estate from the moment of Linnie Jane Hodges’ death (see paragraph
9, supra).
11. The late Linnie Jane Hodges designated her husband C.N. Hodges as her sole and exclusive heir
with full authority to do what he pleased, as exclusive heir and owner of all the assets constituting her
estate, except only with regards certain properties “owned by us, located at, in or near the City of
Lubbock, Texas”. Thus, even without relying on our laws of succession and legitime, which we have cited
above, C. N. Hodges, by specific testamentary designation of his wife, was entitled to the entirely to his
wife’s estate in the Philippines.
12. Article 777 of the New Civil Code provides that “the rights of the successor are transmitted from the
death of the decedent”. Thus, title to the estate of Linnie Jane Hodges was transmitted to C. N. Hodges
immediately upon her death on May 23, 1957. For the convenience of this Honorable Court, we attached
hereto as Annex “C” a graph of how the conjugal estate of the spouses Hodges should be divided in
accordance with Philippine law and the Will of Linnie Jane Hodges.

13. In his capacity as sole heir and successor to the estate of Linnie Jane Hodges as above-stated, C. N.
Hodges, shortly after the death of Linnie Jane Hodges, appropriated to himself the entirety of her estate.
He operated all the assets, engaged in business and performed all acts in connection with the entirety of
the conjugal estate, in his own name alone, just as he had been operating, engaging and doing while the
late Linnie Jane Hodges was still alive. Upon his death on December 25, 1962, therefore, all said
conjugal assets were in his sole possession and control, and registered in his name alone, not as
executor, but as exclusive owner of all said assets.
14. All these acts of C. N. Hodges were authorized and sanctioned expressly and impliedly by various
orders of this Honorable Court, as follows:

(a) In an Order dated May 27, 1957, this Honorable Court ruled that C. N. Hodges “is allowed or
authorized to continue the business in which he was engaged, and to perform acts which he had been
doing while the deceased was living.” (CFI Record, Sp. Proc. No. 1307, p. 11.)
(b) On December 14, 1957, this Honorable Court, on the basis of the following fact, alleged in the verified
Motion dated December 11, 1957 filed by Leon P. Gellada as attorney for the executor C. N. Hodges:

That herein Executor, (is) not only part owner of the properties left as conjugal, but also, the successor to
all the properties left by the deceased Linnie Jane Hodges.’ (CFI Record, Sp. Proc. No. 1307, p. 44;
emphasis supplied.)

issued the following order:

“As prayed for by Attorney Gellada, counsel for the Executor, for the reasons stated in his motion dated
December 11, 1957, which the Court considers well taken, all the sales, conveyances, leases and
mortgages of all the properties left by the deceased Linnie Jane Hodges executed by the Executor,
Charles Newton Hodges are hereby APPROVED. The said Executor is further authorized to execute
subsequent sales, conveyances, leases and mortgages of the properties left by the said deceased Linnie
Jane Hodges in consonance with the wishes contained in the last will and testament of the latter.” (CFI
Record. Sp. Proc. No. 1307, p. 46; emphasis supplied.)
24 ems

(c) On April 21, 1959, this Honorable Court approved the verified inventory and accounting submitted by
C. N. Hodges through his counsel Leon P. Gellada on April 14, 1959 wherein he alleged among other
things,

“That no person interested in the Philippines of the time and place of examining the herein account, be
given notice, as herein executor is the only devisee or legatee of the deceased, in accordance with the
last will and testament already probated by the Honorable Court.” (CFI Record, Sp. Proc. No. 1307, pp.
77-78; emphasis supplied.)
(d) On July 20, 1960, this Honorable Court approved the verified “Annual Statement of Account”
submitted by C. N. Hodges through his counsel Leon P. Gellada on July 21, 1960 wherein he alleged,
among other things.

“That no person interested in the Philippines of the time and place of examining the herein account, be
given notice as herein executor is the only devisee or legatee of the deceased Linnie Jane Hodges , in
accordance with the last will and testament ofthe deceased, already probated by this Honorable Court.”
(CFI Record, Sp. Proc. No. 1307, pp. 81-82; emphasis supplied.)
(e) On May 2, 1961, this Honorable Court approved the verified “Annual Statement of Account By The
Executor For the Year 1960″ submitted through Leon P. Gellada on April 20, 1961 wherein he alleged:

“That no person interested in the Philippines be given notice, ofthe time and place of examining the herein
account, as herein executor is the only devisee or legatee of the deceased Linnie Jane Hodges, in
accordance with the last will and testament ofthe deceased, already probated by this Honorable Court .”
(CFI Record, Sp. Proc. No. 1307, pp. 90-91; emphasis supplied.)
15. Since C. N. Hodges was the sole and exclusive heir of Linnie Jane Hodges, not only by law, but in
accordance with the dispositions of her will, there was, in fact, no need to liquidate the conjugal estate of
the spouses. The entirely of said conjugal estate pertained to him exclusively, therefore this Honorable
Court sanctioned and authorized, as above-stated, C. N. Hodges to manage, operate and control all the
conjugal assets as owner.

16. By expressly authorizing C. N. Hodges to act as he did in connection with the estate of his wife, this
Honorable Court has (1) declared C. N. Hodges as the sole heir of the estate of Linnie Jane Hodges, and
(2) delivered and distributed her estate to C. N. Hodges as sole heir in accordance with the terms and
conditions of her Will. Thus, although the “estate of Linnie Jane Hodges” still exists as a legal and juridical
personality, it had no assets or properties located in the Philippines registered in its name whatsoever at
the time of the death of C. N. Hodges on December 25, 1962.

17. The Will of Linnie Jane Hodges (Annex “A”), fourth paragraph, provides as follows:

“At the death of my said husband, Charles Newton Hodges, I give, devise and bequeath all of the rest,
residue and remainder of my estate both real and personal, wherever situated or located, to be equally
divided among my brothers and sisters, share and share alike, namely:

“Esta Higdon, Emma Howell, Leonard Higdon, Roy Higdon, Sadie Rascoe, Era Boman and Nimray
Higdon.”

Because of the facts hereinabove set out there is no “rest, residue and remainder”, at least to the extent
of the Philippine assets, which remains to vest in the HIGDONS, assuming this proviso in Linnie Jane
Hodges’ Will is valid and binding against the estate of C. N. Hodges.

18. Any claims by the HIGDONS under the above-quoted provision of Linnie Jane Hodges’ Will is without
merit because said provision is void and invalid at least as to the Philippine assets. It should not, in
anyway, affect the rights of the estate of C. N. Hodges or his heirs to the properties, which C. N. Hodges
acquired by way of inheritance from his wife Linnie Jane Hodges upon her death.

(a) In spite of the above-mentioned provision in the Will of Linnie Jane Hodges, C. N. Hodges acquired,
not merely a usufructuary right, but absolute title and ownership to her estate. In a recent case involving a
very similar testamentary provision, the Supreme Court held that the heir first designated acquired full
ownership of the property bequeathed by the will, not mere usufructuary rights. (Consolacion Florentino
de Crisologo, et al., vs. Manuel Singson, G. R. No. L-13876, February 28, 1962.)

(b) Article 864, 872 and 886 of the New Civil Code clearly provide that no charge, condition or substitution
whatsoever upon the legitime can be imposed by a testator. Thus, under the provisions of Articles 900,
995 and 1001 of the New Civil Code, the legitime of a surviving spouse is 1/2 of the estate of the
deceased spouse. Consequently, the above-mentioned provision in the Will of Linnie Jane Hodges is
clearly invalid insofar as the legitime of C. N. Hodges was concerned, which consisted of 1/2 of the 1/2
portion of the conjugal estate, or 1/4 of the entire conjugal estate of the deceased.

(c) There are generally only two kinds of substitution provided for and authorized by our Civil Code
(Articles 857-870), namely, (1) simple or common substitution, sometimes referred to
as vulgar substitution (Article 859), and (2) fideicommissary substitution (Article 863). All other
substitutions are merely variations of these. The substitution provided for by paragraph four of the Will of
Linnie Jane Hodges is not fideicommissary substitution, because there is clearly no obligation on the part
of C. N. Hodges as the first heir designated, to preserve the properties for the substitute heirs.
(Consolacion Florentino de Crisologo et al. vs. Manuel Singson, G. R. No.
L-13876.) At most, it is a vulgar or simple substitution. However, in order that
a vulgar or simple substitution can be valid, three alternative conditions must be present, namely, that the
first designated heir (1) should die before the testator; or (2) should not wish to accept the inheritance; or
(3) should be incapacitated to do so. None of these conditions apply to C. N. Hodges, and, therefore, the
substitution provided for by the above-quoted provision of the Will is not authorized by the Code, and,
therefore, it is void. Manresa, commenting on these kisses of substitution, meaningfully stated that: “…
cuando el testador instituyeun primer heredero, y por fallecimiento de este nombra otro u otros, ha de
entenderse que estas segundas designaciones solo han de llegar a tener efectividad en el caso de que el
primer instituido muera antes que el testador, fuera o no esta su verdadera intencion. …”. (6 Manresa, 7
a ed., pag. 175.) In other words, when another heir is designated to inherit upon the death of a first heir,
the second designation can have effect only in case the first instituted heir dies before the testator,
whether or not that was the true intention of said testator. Since C. N. Hodges did not die before Linnie
Jane Hodges, the provision for substitution contained in Linnie Jane Hodges’ Willis void.
(d) In view of the invalidity of the provision for substitution in the Will, C. N. Hodges’ inheritance to the
entirety of the Linnie Jane Hodges estate is irrevocable and final.

19. Be that as it may, at the time of C. N. Hodges’ death, the entirety of the conjugal estate appeared and
was registered in him exclusively as owner. Thus, the presumption is that all said assets constituted his
estate. Therefore —

(a) If the HIGDONS wish to enforce their dubious rights as substituted heirs to 1/4 of the conjugal estate
(the other 1/4 is covered by the legitime of C. N. Hodges which can not be affected by any testamentary
disposition), their remedy, if any, is to file their claim against the estate of C. N. Hodges, which should be
entitled at the present time to full custody and control of all the conjugal estate of the spouses.

(b) The present proceedings, in which two estates exist under separate administration, where the
administratrix of the Linnie Jane Hodges estate exercises an officious right to object and intervene in
matters affecting exclusively the C. N. Hodges estate, is anomalous.

WHEREFORE, it is most respectfully prayed that after trial and reception of evidence, this Honorable
Court declare:
1. That the estate of Linnie Jane Hodges was and is composed exclusively of one-half (1/2) share in the
conjugal estate of the spouses Hodges, computed as of the date of her death on May 23, 1957;

2. That the other half of the conjugal estate pertained exclusively to C. N. Hodges as his share as partner
in the conjugal partnership;

3. That all “rents, emoluments and income” of the conjugal estate accruing after Linnie Jane Hodges’
death pertains to C. N. Hodges;

4. That C. N. Hodges was the sole and exclusive heir of the estate of Linnie Jane Hodges;

5. That, therefore, the entire conjugal estate of the spouses located in the Philippines, plus all the “rents,
emoluments and income” above-mentioned, now constitutes the estate of C. N. Hodges, capable of
distribution to his heirs upon termination of Special Proceedings No. 1672;

6. That PCIB, as administrator of the estate of C. N. Hodges, is entitled to full and exclusive custody,
control and management of all said properties; and

7. That Avelina A. Magno, as administratrix of the estate of Linnie Jane Hodges, as well as the
HIGDONS, has no right to intervene or participate in the administration of the C. N. Hodges estate.

PCIB further prays for such and other relief as may be deemed just and equitable in the premises.”

(Record, pp. 265-277)

Before all of these motions of petitioner could be resolved, however, on December 21, 1965, private
respondent Magno filed her own “Motion for the Official Declaration of Heirs of the Estate of Linnie Jane
Hodges” as follows:

COMES NOW the Administratrix of the Estate of Linnie Jane Hodges and, through undersigned counsel,
unto this Honorable Court most respectfully states and manifests:

1. That the spouses Charles Newton Hodges and Linnie Jane Hodges were American citizens who died
at the City of Iloilo after having amassed and accumulated extensive properties in the Philippines;

2. That on November 22, 1952, Linnie Jane Hodges executed a last will and testament (the original of this
will now forms part of the records of these proceedings as Exhibit “C” and appears as Sp. Proc. No. 1307,
Folio I, pp. 17-18);

3. That on May 23, 1957, Linnie Jane Hodges died at the City of Iloilo at the time survived by her
husband, Charles Newton Hodges, and several relatives named in her last will and testament;
4. That on June 28, 1957, a petition therefor having been priorly filed and duly heard, this Honorable
Court issued an order admitting to probate the last will and testament of Linnie Jane Hodges (Sp. Proc.
No. 1307, Folio I, pp. 24-25, 26-28);

5. That the required notice to creditors and to all others who may have any claims against the decedent,
Linnie Jane Hodges has already been printed, published and posted (Sp. Proc. No. 1307, Folio I. pp. 34-
40) and the reglamentary period for filing such claims has long ago lapsed and expired without any claims
having been asserted against the estate of Linnie Jane Hodges, approved by the
Administrator/Administratrix of the said estate, nor ratified by this Honorable Court;

6. That the last will and testament of Linnie Jane Hodges already admitted to probate contains an
institution of heirs in the following words:

“SECOND: I give, devise and bequeath all of the rest, residue and remainder of my estate, both personal
and real, wherever situated or located, to my beloved husband, Charles Newton Hodges to have and to
hold unto him, my said husband, during his natural lifetime.

THIRD: I desire, direct and provide that my husband, Charles Newton Hodges, shall have the right to
manage, control, use and enjoy said estate during his lifetime, and, he is hereby given the right to make
any changes in the physical properties of said estate, by sale of any part thereof which he may think best,
and the purchase of any other or additional property as he may think best; to execute conveyances with
or without general or special warranty, conveying in fee simple or for any other term or time, any property
which he may deem proper to dispose of; to lease any of the real property for oil, gas and/or other
minerals, and all such deeds or leases shall pass the absolute fee simple title to the interest so conveyed
in such property as he elect to sell. All rents, emoluments and income from said estate shall belong to
him, and he is further authorized to use any part of the principal of said estate as he may need or desire.
It is provided herein, however, that he shall not sell or otherwise dispose of any of the improved property
now owned by us located at, in or near the City of Lubbock Texas, but he shall have the full right to lease,
manage and enjoy the same during his lifetime, above provided. He shall have the right to subdivide any
farm land and sell lots therein, and may sell unimproved town lots.

FOURTH: At the death of my said husband, Charles Newton Hodges, I give, devise and bequeath all of
the rest, residue and remainder of my estate, both real and personal, wherever situated or located, to be
equally divided among my brothers and sisters, share and share alike, namely:

Esta Higdon, Emma Howell, Leonard Higdon, Roy Higdon, Sadie Rascoe, Era Boman and Nimroy
Higdon.

FIFTH: In case of the death of any of my brothers and/or sisters named in item Fourth, above, prior to the
death of my husband, Charles Newton Hodges, then it is my will and bequest that the heirs of such
deceased brother or sister shall take jointly the share which would have gone to such brother or sister had
she or he survived.”
7. That under the provisions of the last will and testament already above-quoted, Linnie Jane Hodges
gave a life-estate or a usufruct over all her estate to her husband, Charles Newton Hodges, and a vested
remainder-estate or the naked title over the same estate to her relatives named therein;

8. That after the death of Linnie Jane Hodges and after the admission to probate of her last will and
testament, but during the lifetime of Charles Newton Hodges, the said Charles Newton Hodges with full
and complete knowledge of the life-estate or usufruct conferred upon him by the will since he was then
acting as Administrator of the estate and later as Executor of the will of Linnie Jane Hodges,
unequivocably and clearly through oral and written declarations and sworn public statements, renounced,
disclaimed and repudiated his life-estate and usufruct over the estate of Linnie Jane Hodges;

9. That, accordingly, the only heirs left to receive the estate of Linnie Jane Hodges pursuant to her last
will and testament, are her named brothers and sisters, or their heirs, to wit: Esta Higdon, Emma Howell,
Leonard Higdon, Aline Higdon and David Higdon, the latter two being the wife and son respectively of the
deceased Roy Higdon, Sadie Rascoe Era Boman and Nimroy Higdon, all of legal ages, American
citizens, with residence at the State of Texas, United States of America;

10. That at the time of the death of Linnie Jane Hodges on May 23, 1957, she was the co-owner (together
with her husband Charles Newton Hodges) of an undivided one-half interest in their conjugal properties
existing as of that date, May 23, 1957, which properties are now being administered sometimes jointly
and sometimes separately by the Administratrix of the estate of Linnie Jane Hodges and/or the
Administrator of the estate of C. N. Hodges but all of which are under the control and supervision of this
Honorable Court;

11. That because there was no separation or segregation of the interests of husband and wife in the
combined conjugal estate, as there has been no such separation or segregation up to the present, both
interests have continually earned exactly the same amount of “rents, emoluments and income”, the entire
estate having been continually devoted to the business of the spouses as if they were alive;

12. That the one-half interest of Linnie Jane Hodges in the combined conjugal estate was earning “rents,
emoluments and income” until her death on May 23, 1957, when it ceased to be saddled with any more
charges or expenditures which are purely personal to her in nature, and her estate kept on earning such
“rents, emoluments and income” by virtue of their having been expressly renounced, disclaimed and
repudiated by Charles Newton Hodges to whom they were bequeathed for life under the last will and
testament of Linnie Jane Hodges;

13. That, on the other hand, the one-half interest of Charles Newton Hodges in the combined conjugal
estate existing as of May 23, 1957, while it may have earned exactly the same amount of “rents,
emoluments and income” as that of the share pertaining to Linnie Jane Hodges, continued to be
burdened by charges, expenditures, and other dispositions which are purely personal to him in nature,
until the death of Charles Newton Hodges himself on December 25, 1962;
14. That of all the assets of the combined conjugal estate of Linnie Jane Hodges and Charles Newton
Hodges as they exist today, the estate of Linnie Jane Hodges is clearly entitled to a portion more than fifty
percent (50%) as compared to the portion to which the estate of Charles Newton Hodges may be entitled,
which portions can be exactly determined by the following manner:

a. An inventory must be made of the assets of the combined conjugal estate as they existed on the death
of Linnie Jane Hodges on May 23, 1957 — one-half of these assets belong to the estate of Linnie Jane
Hodges;

b. An accounting must be made of the “rents, emoluments and income” of all these assets — again one-
half of these belong to the estate of Linnie Jane Hodges;

c. Adjustments must be made, after making a deduction of charges, disbursements and other dispositions
made by Charles Newton Hodges personally and for his own personal account from May 23, 1957 up to
December 25, 1962, as well as other charges, disbursements and other dispositions made for him and in
his behalf since December 25, 1962 up to the present;

15. That there remains no other matter for disposition now insofar as the estate of Linnie Jane Hodges is
concerned but to complete the liquidation of her estate, segregate them from the conjugal estate, and
distribute them to her heirs pursuant to her last will and testament.

WHEREFORE, premises considered, it is most respectfully moved and prayed that this Honorable Court,
after a hearing on the factual matters raised by this motion, issue an order:

a. Declaring the following persons, to wit: Esta Higdon, Emma Howell, Leonard Higdon, Aline Higdon,
David Higdon, Sadie Rascoe, Era Boman and Nimroy Higdon, as the sole heirs under the last will and
testament of Linnie Jane Hodges and as the only persons entitled to her estate;

b. Determining the exact value of the estate of Linnie Jane Hodges in accordance with the system
enunciated in paragraph 14 of this motion;

c. After such determination ordering its segregation from the combined conjugal estate and its delivery to
the Administratrix of the estate of Linnie Jane Hodges for distribution to the heirs to whom they properly
belong and appertain.

(Green Record on Appeal, pp. 382-391)

whereupon, instead of further pressing on its motion of January 8, 1965 aforequoted, as it had been doing
before, petitioner withdrew the said motion and in addition to opposing the above motion of respondent
Magno, filed a motion on April 22, 1966 alleging in part that:

1. That it has received from the counsel for the administratrix of the supposed estate of Linnie Jane
Hodges a notice to set her “Motion for Official Declaration of Heirs of the Estate of Linnie Jane Hodges”;
2. That before the aforesaid motion could be heard, there are matters pending before this Honorable
Court, such as:

a. The examination already ordered by this Honorable Court of documents relating to the allegation of
Avelina Magno that Charles Newton Hodges “through … written declarations and sworn public
statements, renounced, disclaimed and repudiated life-estate and usufruct over the estate of Linnie Jane
Hodges’;

b. That “Urgent Motion for An Accounting and Delivery to the Estate of C. N. Hodges of All the Assets of
the Conjugal Partnership of the Deceased Linnie Jane Hodges and C. N. Hodges Existing as of May 23,
1957 Plus All the Rents, Emoluments and Income Therefrom”;

c. Various motions to resolve the aforesaid motion;

d. Manifestation of September 14, 1964, detailing acts of interference of Avelina Magno under color of title
as administratrix of the Estate of Linnie Jane Hodges;

which are all prejudicial, and which involve no issues of fact, all facts involved therein being matters of
record, and therefore require only the resolution of questions of law;

3. That whatever claims any alleged heirs or other persons may have could be very easily threshed out in
the Testate Estate of Charles Newton Hodges;

4. That the maintenance of two separate estate proceedings and two administrators only results in
confusion and is unduly burdensome upon the Testate Estate of Charles Newton Hodges, particularly
because the bond filed by Avelina Magno is grossly insufficient to answer for the funds and property
which she has inofficiously collected and held, as well as those which she continues to inofficiously collect
and hold;
5. That it is a matter of record that such state of affairs affects and inconveniences not only the estate but
also third-parties dealing with it;” (Annex “V”, Petition.)

and then, after further reminding the court, by quoting them, of the relevant allegations of its earlier motion
of September 14, 1964, Annex U, prayed that:

1. Immediately order Avelina Magno to account for and deliver to the administrator of the Estate of C. N.
Hodges all the assets of the conjugal partnership of the deceased Linnie Jane Hodges and C. N. Hodges,
plus all the rents, emoluments and income therefrom;

2. Pending the consideration of this motion, immediately order Avelina Magno to turn over all her
collections to the administrator Philippine Commercial & Industrial Bank;

3. Declare the Testate Estate of Linnie Jane Hodges (Sp. Proc. No. 1307) closed;
4. Defer the hearing and consideration of the motion for declaration of heirs in the Testate Estate of Linnie
Jane Hodges until the matters hereinabove set forth are resolved.
(Prayer, Annex “V” of Petition.)

On October 12, 1966, as already indicated at the outset of this opinion, the respondent court denied the
foregoing motion, holding thus:

ORDER

On record is a motion (Vol. X, Sp. 1672, pp. 4379-4390) dated April 22, 1966 of administrator PCIB
praying that (1) Immediately order Avelina Magno to account for and deliver to the administrator of the
estate of C. N. Hodges all assets of the conjugal partnership of the deceased Linnie Jane Hodges and C.
N. Hodges, plus all the rents, emoluments and income therefrom; (2) Pending the consideration of this
motion, immediately order Avelina Magno to turn over all her collections to the administrator PCIB; (3)
Declare the Testate Estate of Linnie Jane Hodges (Sp. Proc. No. 1307) closed; and (4) Defer the hearing
and consideration of the motion for declaration of heirs in the Testate Estate of Linnie Jane Hodges until
the matters hereinabove set forth are resolved.

This motion is predicated on the fact that there are matters pending before this court such as (a) the
examination already ordered by this Honorable Court of documents relating to the allegation of Avelina
Magno that Charles Newton Hodges thru written declaration and sworn public statements renounced,
disclaimed and repudiated his life-estate and usufruct over the estate of Linnie Jane Hodges (b) the
urgent motion for accounting and delivery to the estate of C. N. Hodges of all the assets of the conjugal
partnership of the deceased Linnie Jane Hodges and C. N. Hodges existing as of May 23, 1957 plus all
the rents, emoluments and income therefrom; (c) various motions to resolve the aforesaid motion; and (d)
manifestation of September 14, 1964, detailing acts of interference of Avelina Magno under color of title
as administratrix of the estate of Linnie Jane Hodges.

These matters, according to the instant motion, are all pre-judicial involving no issues of facts and only
require the resolution of question of law; that in the motion of October 5, 1963 it is alleged that in a motion
dated December 11, 1957 filed by Atty. Leon Gellada as attorney for the executor C. N. Hodges, the said
executor C. N. Hodges is not only part owner of the properties left as conjugal but also the successor to
all the properties left by the deceased Linnie Jane Hodges.

Said motion of December 11, 1957 was approved by the Court in consonance with the wishes contained
in the last will and testament of Linnie Jane Hodges.

That on April 21, 1959 this Court approved the inventory and accounting submitted by C. N. Hodges thru
counsel Atty. Leon Gellada in a motion filed on April 14, 1959 stating therein that executor C. N. Hodges
is the only devisee or legatee of Linnie Jane Hodges in accordance with the last will and testament
already probated by the Court.
That on July 13, 1960 the Court approved the annual statement of accounts submitted by the executor C.
N. Hodges thru his counsel Atty. Gellada on July 21, 1960 wherein it is stated that the executor, C. N.
Hodges is the only devisee or legatee of the deceased Linnie Jane Hodges; that on May 2, 1961 the
Court approved the annual statement of accounts submitted by executor, C. N. Hodges for the year 1960
which was submitted by Atty. Gellada on April 20, 1961 wherein it is stated that executor Hodges is the
only devisee or legatee of the deceased Linnie Jane Hodges;

That during the hearing on September 5 and 6, 1963 the estate of C. N. Hodges claimed all the assets
belonging to the deceased spouses Linnie Jane Hodges and C. N. Hodges situated in the Philippines;
that administratrix Magno has executed illegal acts to the prejudice of the testate estate of C. N. Hodges.

An opposition (Sp. 1672, Vol. X, pp. 4415-4421) dated April 27, 1966 of administratrix Magno has been
filed asking that the motion be denied for lack of merit and that the motion for the official declaration of
heirs of the estate of Linnie Jane Hodges be set for presentation and reception of evidence.

It is alleged in the aforesaid opposition that the examination of documents which are in the possession of
administratrix Magno can be made prior to the hearing of the motion for the official declaration of heirs of
the estate of Linnie Jane Hodges, during said hearing.

That the matters raised in the PCIB’s motion of October 5, 1963 (as well as the other motion) dated
September 14, 1964 have been consolidated for the purpose of presentation and reception of evidence
with the hearing on the determination of the heirs of the estate of Linnie Jane Hodges. It is further alleged
in the opposition that the motion for the official declaration of heirs of the estate of Linnie Jane Hodges is
the one that constitutes a prejudicial question to the motions dated October 5 and September 14, 1964
because if said motion is found meritorious and granted by the Court, the PCIB’s motions of October 5,
1963 and September 14, 1964 will become moot and academic since they are premised on the
assumption and claim that the only heir of Linnie Jane Hodges was C. N. Hodges.

That the PCIB and counsel are estopped from further questioning the determination of heirs in the estate
of Linnie Jane Hodges at this stage since it was PCIB as early as January 8, 1965 which filed a motion for
official declaration of heirs of Linnie Jane Hodges that the claim of any heirs of Linnie Jane Hodges can
be determined only in the administration proceedings over the estate of Linnie Jane Hodges and not that
of C. N. Hodges, since the heirs of Linnie Jane Hodges are claiming her estate and not the estate of C. N.
Hodges.

A reply (Sp. 1672, Vol. X, pp. 4436-4444) dated May 11, 1966 of the PCIB has been filed alleging that the
motion dated April 22, 1966 of the PCIB is not to seek deferment of the hearing and consideration of the
motion for official declaration of heirs of Linnie Jane Hodges but to declare the testate estate of Linnie
Jane Hodges closed and for administratrix Magno to account for and deliver to the PCIB all assets of the
conjugal partnership of the deceased spouses which has come to her possession plus all rents and
income.
A rejoinder (Sp. 1672, Vol. X, pp. 4458-4462) of administratrix Magno dated May 19, 1966 has been filed
alleging that the motion dated December 11, 1957 only sought the approval of all conveyances made by
C. N. Hodges and requested the Court authority for all subsequent conveyances that will be executed by
C. N. Hodges; that the order dated December 14, 1957 only approved the conveyances made by C. N.
Hodges; that C. N. Hodges represented by counsel never made any claim in the estate of Linnie Jane
Hodges and never filed a motion to declare himself as the heir of the said Linnie Jane Hodges despite the
lapse of more than five (5) years after the death of Linnie Jane Hodges; that it is further alleged in the
rejoinder that there can be no order of adjudication of the estate unless there has been a prior express
declaration of heirs and so far no declaration of heirs in the estate of Linnie Jane Hodges (Sp. 1307) has
been made.

Considering the allegations and arguments in the motion and of the PCIB as well as those in the
opposition and rejoinder of administratrix Magno, the Court finds the opposition and rejoinder to be well
taken for the reason that so far there has been no official declaration of heirs in the testate estate of
Linnie Jane Hodges and therefore no disposition of her estate.

WHEREFORE, the motion of the PCIB dated April 22, 1966 is hereby DENIED.
(Annex “W”, Petition)

In its motion dated November 24, 1966 for the reconsideration of this order, petitioner alleged inter
alia that:
It cannot be over-stressed that the motion of December 11, 1957 was based on the fact that:

a. Under the last will and testament of the deceased, Linnie Jane Hodges, the late Charles Newton
Hodges was the sole heir instituted insofar as her properties in the Philippines are concerned;

b. Said last will and testament vested upon the said late Charles Newton Hodges rights over said
properties which, in sum, spell ownership, absolute and in fee simple;

c. Said late Charles Newton Hodges was, therefore, “not only part owner of the properties left as conjugal,
but also, the successor to all the properties left by the deceased Linnie Jane Hodges.

Likewise, it cannot be over-stressed that the aforesaid motion was granted by this Honorable Court “for
the reasons stated” therein.

Again, the motion of December 11, 1957 prayed that not only “all the sales, conveyances, leases, and
mortgages executed by” the late Charles Newton Hodges, but also all “the subsequent sales,
conveyances, leases, and mortgages …” be approved and authorized. This Honorable Court, in its order
of December 14, 1957, “for the reasons stated” in the aforesaid motion, granted the same, and not only
approved all the sales, conveyances, leases and mortgages of all properties left by the deceased Linnie
Jane Hodges executed by the late Charles Newton Hodges, but also authorized “all subsequent sales,
conveyances, leases and mortgages of the properties left by the said deceased Linnie Jane Hodges.
(Annex “X”, Petition)

and reiterated its fundamental pose that the Testate Estate of Linnie Jane Hodges had already been
factually, although not legally, closed with the virtual declaration of Hodges and adjudication to him, as
sole universal heir of all the properties of the estate of his wife, in the order of December 14, 1957, Annex
G. Still unpersuaded, on July 18, 1967, respondent court denied said motion for reconsideration and held
that “the court believes that there is no justification why the order of October 12, 1966 should be
considered or modified”, and, on July 19, 1967, the motion of respondent Magno “for official declaration of
heirs of the estate of Linnie Jane Hodges”, already referred to above, was set for hearing.

In consequence of all these developments, the present petition was filed on August 1, 1967 (albeit
petitioner had to pay another docketing fee on August 9, 1967, since the orders in question were issued in
two separate testate estate proceedings, Nos. 1307 and 1672, in the court below).

Together with such petition, there are now pending before Us for resolution herein, appeals from the
following:

1. The order of December 19, 1964 authorizing payment by respondent Magno of overtime pay, (pp. 221,
Green Record on Appeal) together with the subsequent orders of January 9, 1965, (pp. 231-232, id.)
October 27, 1965, (pp. 227, id.) and February 15, 1966 (pp. 455-456, id.) repeatedly denying motions for
reconsideration thereof.
2. The order of August 6, 1965 (pp. 248, id.) requiring that deeds executed by petitioner to be co-signed
by respondent Magno, as well as the order of October 27, 1965 (pp. 276-277) denying reconsideration.
3. The order of October 27, 1965 (pp. 292-295, id.) enjoining the deposit of all collections in a joint
account and the same order of February 15, 1966 mentioned in No. 1 above which included the denial of
the reconsideration of this order of October 27, 1965.
4. The order of November 3, 1965 (pp. 313-320, id.) directing the payment of attorney’s fees, fees of the
respondent administratrix, etc. and the order of February 16, 1966 denying reconsideration thereof.
5. The order of November 23, 1965 (pp. 334-335, id.) allowing appellee Western Institute of Technology
to make payments to either one or both of the administrators of the two estates as well as the order of
March 7, 1966 (p. 462, id.) denying reconsideration.
6. The various orders hereinabove earlier enumerated approving deeds of sale executed by respondent
Magno in favor of appellees Carles, Catedral, Pablito, Guzman, Coronado, Barrido, Causing, Javier,
Lucero and Batisanan, (see pp. 35 to 37 of this opinion), together with the two separate orders both dated
December 2, 1966 (pp. 306-308, and pp. 308-309, Yellow Record on Appeal) denying reconsideration of
said approval.

7. The order of January 3, 1967, on pp. 335-336, Yellow Record on Appeal, approving similar deeds of
sale executed by respondent Magno, as those in No. 6, in favor of appellees Pacaonsis and Premaylon,
as to which no motion for reconsideration was filed.
8. Lastly, the order of December 2, 1966, on pp. 305-306, Yellow Record on Appeal, directing petitioner to
surrender to appellees Lucero, Batisanan, Javier, Pablito, Barrido, Catedral, Causing, Guzman, and
Coronado, the certificates of title covering the lands involved in the approved sales, as to which no motion
for reconsideration was filed either.

Strictly speaking, and considering that the above orders deal with different matters, just as they affect
distinctly different individuals or persons, as outlined by petitioner in its brief as appellant on pp. 12-20
thereof, there are, therefore, thirty-three (33) appeals before Us, for which reason, petitioner has to pay
also thirty-one (31) more docket fees.

It is as well perhaps to state here as elsewhere in this opinion that in connection with these appeals,
petitioner has assigned a total of seventy-eight (LXXVIII) alleged errors, the respective discussions and
arguments under all of them covering also the fundamental issues raised in respect to the petition
for certiorari and prohibition, thus making it feasible and more practical for the Court to dispose of all
these cases together. 4
The assignments of error read thus:

I to IV

THE ORDER COURT ERRED IN APPROVING THE FINAL DEEDS OF SALE IN FAVOR OF THE
APPELLEES, PEPITO G. IYULORES, ESPIRIDION PARTISALA, WINIFREDO C. ESPADA AND
ROSARIO ALINGASA, EXECUTED BY THE APPELLEE, AVELINA A. MAGNO, COVERING PARCELS
OF LAND OWNED BY THE DECEASED, CHARLES NEWTON HODGES, AND THE CONTRACTS TO
SELL COVERING WHICH WERE EXECUTED BY HIM DURING HIS LIFETIME.

V to VIII

THE LOWER COURT ERRED IN APPROVING THE DEEDS OF SALE IN FAVOR OF THE
APPELLEES, PEPITO G. IYULORES, ESPIRIDION PARTISALA, WINIFREDO C. ESPADA AND
ROSARIO ALINGASA, COVERING PARCELS OF LAND FOR WHICH THEY HAVE NEVER PAID IN
FULL IN ACCORDANCE WITH THE ORIGINAL CONTRACTS TO SELL.

IX to XII

THE LOWER COURT ERRED IN DETERMINING THE RIGHTS OF OWNERSHIP OVER REAL
PROPERTY OF THE APPELLEES, PEPITO G. IYULORES, ESPIRIDION PARTISALA, WINIFREDO C.
ESPADA AND ROSARIO ALINGASA, WHILE ACTING AS A PROBATE COURT.

XIII to XV

THE LOWER COURT ERRED IN APPROVING THE FINAL DEEDS OF SALE IN FAVOR OF THE
APPELLEES ADELFA PREMAYLON (LOT NO. 102), SANTIAGO PACAONSIS, AND ADELFA
PREMAYLON (LOT NO. 104), EXECUTED BY THE APPELLEE, AVELINA A. MAGNO, COVERING
PARCELS OF LAND OWNED BY THE DECEASED, CHARLES NEWTON HODGES, AND THE
CONTRACTS TO SELL COVERING WHICH WERE EXECUTED BY HIM DURING HIS LIFETIME.

XVI to XVIII

THE LOWER COURT ERRED IN APPROVING THE DEEDS OF SALE IN FAVOR OF THE APPELLEES
ADELFA PREMAYLON (LOT NO. 102), SANTIAGO PACAONSIS, AND ADELFA PREMAYLON (LOT
NO. 104) COVERING PARCELS OF LAND FOR WHICH THEY HAVE NEVER PAID IN FULL IN
ACCORDANCE WITH THE ORIGINAL CONTRACTS TO SELL.

XIX to XXI

THE LOWER COURT ERRED IN DETERMINING THE RIGHTS OF OWNERSHIP OVER REAL
PROPERTY OF THE APPELLEES ADELFA PREMAYLON (LOT NO. 102), SANTIAGO PACAONSIS,
AND ADELFA PREMAYLON (LOT NO. 104) WHILE ACTING AS A PROBATE COURT.

XXII to XXV

THE LOWER COURT ERRED IN APPROVING THE FINAL DEEDS OF SALE IN FAVOR OF THE
APPELLEES LORENZO CARLES, JOSE PABLICO, ALFREDO CATEDRAL AND SALVADOR S.
GUZMAN, EXECUTED BY THE APPELLEE, AVELINA A. MAGNO, COVERING PARCELS OF LAND
OWNED BY THE DECEASED, CHARLES NEWTON HODGES, AND THE CONTRACTS TO SELL
COVERING WHICH WERE EXECUTED BY HIM DURING HIS LIFETIME.

XXVI to XXIX

THE LOWER COURT ERRED IN APPROVING THE FINAL DEED OF SALE EXECUTED IN FAVOR OF
THE APPELLEES, LORENZO CARLES, JOSE PABLICO, ALFREDO CATEDRAL AND SALVADOR S.
GUZMAN PURSUANT TO CONTRACTS TO SPELL WHICH WERE CANCELLED AND RESCINDED.

XXX to XXXIV

THE LOWER COURT ERRED IN DETERMINING THE RIGHTS OF OWNERSHIP OVER REAL
PROPERTY OF THE LORENZO CARLES, JOSE PABLICO, ALFREDO CATEDRAL AND SALVADOR
S. GUZMAN, WHILE ACTING AS A PROBATE COURT.

XXXV to XXXVI

THE LOWER COURT ERRED IN APPROVING THE FINAL DEEDS OF SALE IN FAVOR OF THE
APPELLEES, FLORENIA BARRIDO AND PURIFICACION CORONADO, EXECUTED BY THE
APPELLEE, AVELINA A. MAGNO, COVERING PARCELS OF LAND OWNED BY THE DECEASED,
CHARLES NEWTON HODGES, AND THE CONTRACTS TO SELL COVERING WHICH WERE
EXECUTED BY HIM DURING HIS LIFETIME.
XXXVII to XXXVIII

THE LOWER COURT ERRED IN APPROVING THE DEEDS OF SALE IN FAVOR OF THE
APPELLEES, FLORENIA BARRIDO AND PURIFICACION CORONADO, ALTHOUGH THEY WERE IN
ARREARS IN THE PAYMENTS AGREED UPON IN THE ORIGINAL CONTRACT TO SELL WHICH
THEY EXECUTED WITH THE DECEASED, CHARLES NEWTON HODGES, IN THE AMOUNT OF
P10,680.00 and P4,428.90, RESPECTIVELY.

XXXIX to XL

THE LOWER COURT ERRED IN DEPRIVING THE DECEASED, CHARLES NEWTON HODGES, OF
THE CONTRACTUAL RIGHT, EXERCISED THROUGH HIS ADMINISTRATOR, THE INSTANT
APPELLANT, TO CANCEL THE CONTRACTS TO SELL OF THE APPELLEES, FLORENIA BARRIDO
AND PURIFICACION CORONADO.

XLI to XLIII

THE LOWER COURT ERRED IN APPROVING THE FINAL DEEDS OF SALE IN FAVOR OF THE
APPELLEES, GRACIANO LUCERO, ARITEO THOMAS JAMIR AND MELQUIADES BATISANAN,
EXECUTED BY THE APPELLEE, AVELINA A. MAGNO, COVERING PARCELS OF LAND OWNED BY
THE DECEASED, CHARLES NEWTON HODGES, AND THE CONTRACTS TO SELL COVERING
WHICH WERE EXECUTED BY HIM DURING HIS LIFETIME.

XLIV to XLVI

THE LOWER COURT ERRED IN APPROVING THE FINAL DEED OF SALE IN FAVOR OF THE
APPELLEES, GRACIANO LUCERO, ARITEO THOMAS JAMIR AND MELQUIADES BATISANAN,
PURSUANT TO CONTRACTS TO SELL EXECUTED BY THEM WITH THE DECEASED, CHARLES
NEWTON HODGES, THE TERMS AND CONDITIONS OF WHICH THEY HAVE NEVER COMPLIED
WITH.

XLVII to XLIX

THE LOWER COURT ERRED IN DEPRIVING THE DECEASED, CHARLES NEWTON HODGES, OF
HIS RIGHT, EXERCISED THROUGH HIS ADMINISTRATION, THE INSTANT APPELLANT, TO
CANCEL THE CONTRACTS TO SELL OF THE APPELLEES, GRACIANO LUCERO, ARITEO THOMAS
JAMIR AND MELQUIADES BATISANAN, AND IN DETERMINING THE RIGHTS OF THE SAID
APPELLEES OVER REAL PROPERTY WHILE ACTING AS A PROBATE COURT.

THE LOWER COURT ERRED IN APPROVING THE FINAL DEEDS OF SALE IN FAVOR OF THE
APPELLEE, BELCESAR CAUSING, EXECUTED BY THE APPELLEE, AVELINA A. MAGNO,
COVERING PARCELS OF LAND OWNED BY THE DECEASED, CHARLES NEWTON HODGES, AND
THE CONTRACTS TO SELL COVERING WHICH WERE EXECUTED BY HIM DURING HIS LIFETIME.

LI

THE LOWER COURT ERRED IN APPROVING THE DEEDS OF SALE IN FAVOR OF THE APPELLEE,
BELCESAR CAUSING, ALTHOUGH HE WAS IN ARREARS IN THE PAYMENTS AGREED UPON IN
THE ORIGINAL CONTRACT TO SELL WHICH HE EXECUTED WITH THE DECEASED, CHARLES
NEWTON HODGES, IN THE AMOUNT OF P2,337.50.

LII

THE LOWER COURT ERRED IN APPROVING THE DEED OF SALE IN FAVOR OF THE APPELLEE,
BELCESAR CAUSING, ALTHOUGH THE SAME WAS NOT EXECUTED IN ACCORDANCE WITH THE
RULES OF COURT.

LIII to LXI

THE LOWER COURT ERRED IN ORDERING THE APPELLANT, PHILIPPINE COMMERCIAL AND
INDUSTRIAL BANK TO SURRENDER THE OWNER’S DUPLICATE CERTIFICATES OF TITLE OVER
THE RESPECTIVE LOTS COVERED BY THE DEEDS OF SALE EXECUTED BY THE APPELLEE,
AVELINA A. MAGNO, IN FAVOR OF THE OTHER APPELLEES, JOSE PABLICO, ALFREDO
CATEDRAL, SALVADOR S. GUZMAN, FLRENIA BARRIDO, PURIFICACION CORONADO, BELCESAR
CAUSING, ARITEO THOMAS JAMIR, MAXIMA BATISANAN AND GRACIANO L. LUCERO.

LXII

THE LOWER COURT ERRED IN RESOLVING THE MOTION OF THE APPELLEE, WESTERN
INSTITUTE OF TECHNOLOGY, DATED NOVEMBER 3, 1965, WITHOUT ANY COPY THEREOF
HAVING BEEN SERVED UPON THE APPELLANT, PHILIPPINE COMMERCIAL & INDUSTRIAL BANK.

LXIII

THE LOWER COURT ERRED IN HEARING AND CONSIDERING THE MOTION OF THE APPELLEE,
WESTERN INSTITUTE OF TECHNOLOGY, DATED NOVEMBER 3rd, 1965, ON NOVEMBER 23, 1965,
WHEN THE NOTICE FOR THE HEARING THEREOF WAS FOR NOVEMBER 20, 1965.

LXIV

THE LOWER COURT ERRED IN GRANTING THE APPELLEE, WESTERN INSTITUTE OF

TECHNOLOGY A RELIEF OTHER THAN THAT PRAYED FOR IN ITS MOTION, DATED NOVEMBER 3,
1965, IN THE ABSENCE OF A PRAYER FOR GENERAL RELIEF CONTAINED THEREIN.

LXV
THE LOWER COURT ERRED IN ALLOWING THE APPELLEE, WESTERN INSTITUTE OF
TECHNOLOGY, TO CONTINUE PAYMENTS UPON A CONTRACT TO SELL THE TERMS AND
CONDITIONS OF WHICH IT HAS FAILED TO FULFILL.

LXVI

THE LOWER COURT ERRED IN DETERMINING THE RIGHTS OF THE APPELLEE, WESTERN
INSTITUTE OF TECHNOLOGY OVER THE REAL PROPERTY SUBJECT MATTER OF THE
CONTRACT TO SELL IT EXECUTED WITH THE DECEASED, CHARLES NEWTON HODGES, WHILE
ACTING AS A PROBATE COURT.

LXVII

LOWER COURT ERRED IN ALLOWING THE CONTINUATION OF PAYMENTS BY THE APPELLEE,

WESTERN INSTITUTE OF TECHNOLOGY, UPON A CONTRACT TO SELL EXECUTED BY IT AND
THE DECEASED, CHARLES NEWTON HODGES, TO A PERSON OTHER THAN HIS LAWFULLY
APPOINTED ADMINISTRATOR.

LXVIII

THE LOWER COURT ERRED IN ORDERING THE PAYMENT OF RETAINER’S FEES FROM THE
SUPPOSED ESTATE OF THE DECEASED, LINNIE JANE HODGES, WHEN THERE IS NEITHER
SUCH ESTATE NOR ASSETS THEREOF.

LXIX

THE LOWER COURT ERRED IN ORDERING THE PAYMENT OF RETAINER’S FEES OF LAWYERS
OF ALLEGED HEIRS TO THE SUPPOSED ESTATE OF THE DECEASED, LINNIE JANE HODGES.

LXX

THE LOWER COURT ERRED IN IMPLEMENTING THE ALLEGED AGREEMENT BETWEEN THE
HEIRS OF THE SUPPOSED ESTATE OF THE DECEASED, LINNIE JANE HODGES, AND THEIR
LAWYERS.

LXXI

THE LOWER COURT ERRED IN ORDERING THE PREMATURE DISTRIBUTION OF ESTATE ASSETS
TO ALLEGED HEIRS OR BENEFICIARIES THEREOF, BY WAY OF RETAINER’S FEES.

LXXII

THE LOWER COURT ERRED IN ORDERING THAT ALL FINAL DEEDS OF SALE EXECUTED
PURSUANT TO CONTRACTS TO SELL ENTERED INTO BY THE DECEASED, CHARLES NEWTON
HODGES, DURING HIS LIFETIME, BE SIGNED JOINTLY BY THE APPELLEE, AVELINA A. MAGNO,
AND THE APPELLANT, PHILIPPINE COMMERCIAL AND INDUSTRIAL BANK, AND NOT BY THE
LATTER ONLY AS THE LAWFULLY APPOINTED ADMINISTRATOR OF HIS ESTATE.

LXXIII

THE LOWER COURT ERRED IN ORDERING THE PAYMENT OF LEGAL EXPENSES FROM THE
SUPPOSED ESTATE OF THE DECEASED, LINNIE JANE HODGES, WHEN THERE IS NEITHER
SUCH ESTATE NOR ASSETS THEREOF.

LXXIV

THE LOWER COURT ERRED IN ORDERING THE PAYMENT OF LEGAL EXPENSES OF LAWYERS
OF ALLEGED HEIRS TO THE SUPPOSED ESTATE OF THE DECEASED, LINNIE JANE HODGES.

LXXV

THE LOWER COURT ERRED IN ORDERING THE PREMATURE DISTRIBUTION OF ESTATE ASSETS
TO ALLEGED HEIRS OR BENEFICIARIES THEREOF, BY WAY OF LEGAL EXPENSES.

LXXVI

THE LOWER COURT ERRED IN ORDERING THE PAYMENT OF COMPENSATION TO THE

PURPORTED ADMINISTRATRIX OF THE SUPPOSED ESTATE OF THE DECEASED, LINNIE JANE
HODGES, THE INSTANT APPELLEE, AVELINA A. MAGNO, WHEN THERE IS NEITHER SUCH
ESTATE NOR ASSETS THEREOF.

LXXVII

THE LOWER COURT ERRED IN ORDERING THAT THE FUNDS OF THE TESTATE ESTATE OF THE
DECEASED, CHARLES NEWTON HODGES, BE PLACED IN A JOINT ACCOUNT OF THE
APPELLANT, PHILIPPINE COMMERCIAL AND INDUSTRIAL BANK, AND THE APPELLEE, AVELINA
A. MAGNO, WHO IS A COMPLETE STRANGER TO THE AFORESAID ESTATE.

LXXVIII

THE LOWER COURT ERRED IN ORDERING THAT THE APPELLEE, AVELINA A. MAGNO, BE GIVEN
EQUAL ACCESS TO THE RECORDS OF THE TESTATE ESTATE OF THE DECEASED, CHARLES
NEWTON HODGES, WHEN SHE IS A COMPLETE STRANGER TO THE AFORESAID ESTATE. (Pp.
73-83, Appellant’s Brief.)

To complete this rather elaborate, and unavoidably extended narration of the factual setting of these
cases, it may also be mentioned that an attempt was made by the heirs of Mrs. Hodges to have
respondent Magno removed as administratrix, with the proposed appointment of Benito J. Lopez in her
place, and that respondent court did actually order such proposed replacement, but the Court declared
the said order of respondent court violative of its injunction of August 8, 1967, hence without force and
effect (see Resolution of September 8, 1972 and February 1, 1973). Subsequently, Atty. Efrain B. Trenas,
one of the lawyers of said heirs, appeared no longer for the proposed administrator Lopez but for the
heirs themselves, and in a motion dated October 26, 1972 informed the Court that a motion had been
filed with respondent court for the removal of petitioner PCIB as administrator of the estate of C. N.
Hodges in Special Proceedings 1672, which removal motion alleged that 22.968149% of the share of C.
N. Hodges had already been acquired by the heirs of Mrs. Hodges from certain heirs of her husband.
Further, in this connection, in the answer of PCIB to the motion of respondent Magno to have it declared
in contempt for disregarding the Court’s resolution of September 8, 1972 modifying the injunction of
August 8, 1967, said petitioner annexed thereto a joint manifestation and motion, appearing to have been
filed with respondent court, informing said court that in addition to the fact that 22% of the share of C. N.
Hodges had already been bought by the heirs of Mrs. Hodges, as already stated, certain other heirs of
Hodges representing 17.343750% of his estate were joining cause with the heirs of Mrs. Hodges as
against PCIB, thereby making somewhat precarious, if not possibly untenable, petitioners’ continuation as
administrator of the Hodges estate.

RESOLUTION OF ISSUES IN THE CERTIORARI AND

PROHIBITION CASES
I

As to the Alleged Tardiness

of the Present Appeals
The priority question raised by respondent Magno relates to the alleged tardiness of all the
aforementioned thirty-three appeals of PCIB. Considering, however, that these appeals revolve around
practically the same main issues and that it is admitted that some of them have been timely taken, and,
moreover, their final results hereinbelow to be stated and explained make it of no consequence whether
or not the orders concerned have become final by the lapsing of the respective periods to appeal them,
We do not deem it necessary to pass upon the timeliness of any of said appeals.

II

The Propriety Here of Certiorari and

Prohibition instead of Appeal
The other preliminary point of the same respondent is alleged impropriety of the special civil action
of certiorari and prohibition in view of the existence of the remedy of appeal which it claims is proven by
the very appeals now before Us. Such contention fails to take into account that there is a common thread
among the basic issues involved in all these thirty-three appeals which, unless resolved in one single
proceeding, will inevitably cause the proliferation of more or less similar or closely related incidents and
consequent eventual appeals. If for this consideration alone, and without taking account anymore of the
unnecessary additional effort, expense and time which would be involved in as many individual appeals
as the number of such incidents, it is logical and proper to hold, as We do hold, that the remedy of appeal
is not adequate in the present cases. In determining whether or not a special civil action of certiorari or
prohibition may be resorted to in lieu of appeal, in instances wherein lack or excess of jurisdiction or grave
abuse of discretion is alleged, it is not enough that the remedy of appeal exists or is possible. It is
indispensable that taking all the relevant circumstances of the given case, appeal would better serve the
interests of justice. Obviously, the longer delay, augmented expense and trouble and unnecessary
repetition of the same work attendant to the present multiple appeals, which, after all, deal with practically
the same basic issues that can be more expeditiously resolved or determined in a single special civil
action, make the remedies of certiorari and prohibition, pursued by petitioner, preferable, for purposes of
resolving the common basic issues raised in all of them, despite the conceded availability of appeal.
Besides, the settling of such common fundamental issues would naturally minimize the areas of conflict
between the parties and render more simple the determination of the secondary issues in each of them.
Accordingly, respondent Magno’s objection to the present remedy of certiorari and prohibition must be
overruled.
We come now to the errors assigned by petitioner-appellant, Philippine Commercial & Industrial Bank,
(PCIB, for short) in the petition as well as in its main brief as appellant.

III

On Whether or Not There is Still Any Part of the Testate

Estate Mrs. Hodges that may be Adjudicated to her brothers
and sisters as her estate, of which respondent Magno is the
unquestioned Administratrix in special Proceedings 1307.
In the petition, it is the position of PCIB that the respondent court exceeded its jurisdiction or gravely
abused its discretion in further recognizing after December 14, 1957 the existence of the Testate Estate
of Linnie Jane Hodges and in sanctioning purported acts of administration therein of respondent Magno.
Main ground for such posture is that by the aforequoted order of respondent court of said date, Hodges
was already allowed to assert and exercise all his rights as universal heir of his wife pursuant to the
provisions of her will, quoted earlier, hence, nothing else remains to be done in Special Proceedings 1307
except to formally close it. In other words, the contention of PCIB is that in view of said order, nothing
more than a formal declaration of Hodges as sole and exclusive heir of his wife and the consequent
formal unqualified adjudication to him of all her estate remain to be done to completely close Special
Proceedings 1307, hence respondent Magno should be considered as having ceased to be Administratrix
of the Testate Estate of Mrs. Hodges since then.

After carefully going over the record, We feel constrained to hold that such pose is patently untenable
from whatever angle it is examined.

To start with, We cannot find anywhere in respondent Order of December 14, 1957 the sense being read
into it by PCIB. The tenor of said order bears no suggestion at all to such effect. The declaration of heirs
and distribution by the probate court of the estate of a decedent is its most important function, and this
Court is not disposed to encourage judges of probate proceedings to be less than definite, plain and
specific in making orders in such regard, if for no other reason than that all parties concerned, like the
heirs, the creditors, and most of all the government, the devisees and legatees, should know with
certainty what are and when their respective rights and obligations ensuing from the inheritance or in
relation thereto would begin or cease, as the case may be, thereby avoiding precisely the legal
complications and consequent litigations similar to those that have developed unnecessarily in the
present cases. While it is true that in instances wherein all the parties interested in the estate of a
deceased person have already actually distributed among themselves their respective shares therein to
the satisfaction of everyone concerned and no rights of creditors or third parties are adversely affected, it
would naturally be almost ministerial for the court to issue the final order of declaration and distribution,
still it is inconceivable that the special proceeding instituted for the purpose may be considered
terminated, the respective rights of all the parties concerned be deemed definitely settled, and the
executor or administrator thereof be regarded as automatically discharged and relieved already of all
functions and responsibilities without the corresponding definite orders of the probate court to such effect.

Indeed, the law on the matter is specific, categorical and unequivocal. Section 1 of Rule 90 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.

These provisions cannot mean anything less than that in order that a proceeding for the settlement of the
estate of a deceased may be deemed ready for final closure, (1) there should have been issued already
an order of distribution or assignment of the estate of the decedent among or to those entitled thereto by
will or by law, but (2) such order shall not be issued until after it is shown that the “debts, funeral
expenses, expenses of administration, allowances, taxes, etc. chargeable to the estate” have been paid,
which is but logical and proper. (3) Besides, such an order is usually issued upon proper and specific
application for the purpose of the interested party or parties, and not of the court.

… it is only after, and not before, the payment of all debts, funeral charges, expenses of administration,
allowance to the widow, and inheritance tax shall have been effected that the court should make a
declaration of heirs or of such persons as are entitled by law to the residue. (Moran, Comments on the
Rules of Court, 2nd ed., Vol. II, p. 397, citing Capistrano vs. Nadurata, 49 Phil., 726; Lopez vs. Lopez, 37
Off. Gaz., 3091.) (JIMOGA-ON v. BELMONTE, 84 Phil. 545, 548) (p. 86, Appellee’s Brief)

xxx xxx xxx

Under Section 753 of the Code of Civil Procedure, (corresponding to Section 1, Rule 90) what brings an
intestate (or testate) proceeding to a close is the order of distribution directing delivery of the residue to
the persons entitled thereto after paying the indebtedness, if any, left by the deceased. (Santiesteban vs.
Santiesteban, 68 Phil. 367, 370.)

In the cases at bar, We cannot discern from the voluminous and varied facts, pleadings and orders before
Us that the above indispensable prerequisites for the declaration of heirs and the adjudication of the
estate of Mrs. Hodges had already been complied with when the order of December 14, 1957 was issued.
As already stated, We are not persuaded that the proceedings leading to the issuance of said order,
constituting barely of the motion of May 27, 1957, Annex D of the petition, the order of even date, Annex
E, and the motion of December 11, 1957, Annex H, all aforequoted, are what the law contemplates. We
cannot see in the order of December 14, 1957, so much relied upon by the petitioner, anything more than
an explicit approval of “all the sales, conveyances, leases and mortgages of all the properties left by the
deceased Linnie Jane Hodges executed by the Executor Charles N. Hodges” (after the death of his wife
and prior to the date of the motion), plus a general advance authorization to enable said “Executor — to
execute subsequent sales, conveyances, leases and mortgages of the properties left the said deceased
Linnie Jane Hodges in consonance with wishes conveyed in the last will and testament of the latter”,
which, certainly, cannot amount to the order of adjudication of the estate of the decedent to Hodges
contemplated in the law. In fact, the motion of December 11, 1957 on which the court predicated the order
in question did not pray for any such adjudication at all. What is more, although said motion did allege that
“herein Executor (Hodges) is not only part owner of the properties left as conjugal, but also, the successor
to all the properties left by the deceased Linnie Jane Hodges”, it significantly added that “herein Executor,
as Legatee (sic), has the right to sell, convey, lease or dispose of the properties in the Philippines —
during his lifetime”, thereby indicating that what said motion contemplated was nothing more than either
the enjoyment by Hodges of his rights under the particular portion of the dispositions of his wife’s will
which were to be operative only during his lifetime or the use of his own share of the conjugal estate,
pending the termination of the proceedings. In other words, the authority referred to in said motions and
orders is in the nature of that contemplated either in Section 2 of Rule 109 which permits, in appropriate
cases, advance or partial implementation of the terms of a duly probated will before final adjudication or
distribution when the rights of third parties would not be adversely affected thereby or in the established
practice of allowing the surviving spouse to dispose of his own share of he conjugal estate, pending its
final liquidation, when it appears that no creditors of the conjugal partnership would be prejudiced thereby,
(see the Revised Rules of Court by Francisco, Vol. V-B, 1970 ed. p. 887) albeit, from the tenor of said
motions, We are more inclined to believe that Hodges meant to refer to the former. In any event, We are
fully persuaded that the quoted allegations of said motions read together cannot be construed as a
repudiation of the rights unequivocally established in the will in favor of Mrs. Hodges’ brothers and sisters
to whatever have not been disposed of by him up to his death.

Indeed, nowhere in the record does it appear that the trial court subsequently acted upon the premise
suggested by petitioner. On the contrary, on November 23, 1965, when the court resolved the motion of
appellee Western Institute of Technology by its order We have quoted earlier, it categorically held that as
of said date, November 23, 1965, “in both cases (Special Proceedings 1307 and 1672) there is as yet no
judicial declaration of heirs nor distribution of properties to whomsoever are entitled thereto.” In this
connection, it may be stated further against petitioner, by way of some kind of estoppel, that in its own
motion of January 8, 1965, already quoted in full on pages 54-67 of this decision, it prayed inter alia that
the court declare that “C. N. Hodges was the sole and exclusive heir of the estate of Linnie Jane Hodges”,
which it would not have done if it were really convinced that the order of December 14, 1957 was already
the order of adjudication and distribution of her estate. That said motion was later withdrawn when Magno
filed her own motion for determination and adjudication of what should correspond to the brothers and
sisters of Mrs. Hodges does not alter the indubitable implication of the prayer of the withdrawn motion.
It must be borne in mind that while it is true that Mrs. Hodges bequeathed her whole estate to her
husband and gave him what amounts to full powers of dominion over the same during his lifetime, she
imposed at the same time the condition that whatever should remain thereof upon his death should go to
her brothers and sisters. In effect, therefore, what was absolutely given to Hodges was only so much of
his wife’s estate as he might possibly dispose of during his lifetime; hence, even assuming that by the
allegations in his motion, he did intend to adjudicate the whole estate to himself, as suggested by
petitioner, such unilateral act could not have affected or diminished in any degree or manner the right of
his brothers and sisters-in-law over what would remain thereof upon his death, for surely, no one can
rightly contend that the testamentary provision in question allowed him to so adjudicate any part of the
estate to himself as to prejudice them. In other words, irrespective of whatever might have been Hodges’
intention in his motions, as Executor, of May 27, 1957 and December 11, 1957, the trial court’s orders
granting said motions, even in the terms in which they have been worded, could not have had the effect of
an absolute and unconditional adjudication unto Hodges of the whole estate of his wife. None of them
could have deprived his brothers and sisters-in-law of their rights under said will. And it may be added
here that the fact that no one appeared to oppose the motions in question may only be attributed, firstly,
to the failure of Hodges to send notices to any of them, as admitted in the motion itself, and, secondly, to
the fact that even if they had been notified, they could not have taken said motions to be for the final
distribution and adjudication of the estate, but merely for him to be able, pending such final distribution
and adjudication, to either exercise during his lifetime rights of dominion over his wife’s estate in
accordance with the bequest in his favor, which, as already observed, may be allowed under the broad
terms of Section 2 of Rule 109, or make use of his own share of the conjugal estate. In any event, We do
not believe that the trial court could have acted in the sense pretended by petitioner, not only because of
the clear language of the will but also because none of the interested parties had been duly notified of the
motion and hearing thereof. Stated differently, if the orders of May 27, 1957 and December 4, 1957 were
really intended to be read in the sense contended by petitioner, We would have no hesitancy in declaring
them null and void.
Petitioner cites the case of Austria vs. Ventenilla, G. R. No. L-10018, September 19, 1956, (unreported
but a partial digest thereof appears in 99 Phil. 1069) in support of its insistence that with the orders of May
27 and December 14, 1957, the closure of Mrs. Hodges’ estate has become a mere formality, inasmuch
as said orders amounted to the order of adjudication and distribution ordained by Section 1 of Rule 90.
But the parallel attempted to be drawn between that case and the present one does not hold. There the
trial court had in fact issued a clear, distinct and express order of adjudication and distribution more than
twenty years before the other heirs of the deceased filed their motion asking that the administratrix be
removed, etc. As quoted in that decision, the order of the lower court in that respect read as follows:
En orden a la mocion de la administradora, el juzgado la encuentra procedente bajo la condicion de que
no se hara entrega ni adjudicacion de los bienes a los herederos antes de que estos presten la fianza
correspondiente y de acuerdo con lo prescrito en el Art. 754 del Codigo de Procedimientos: pues, en
autos no aparece que hayan sido nombrados comisionados de avaluo y reclamaciones. Dicha fianza
podra ser por un valor igual al de los bienes que correspondan a cada heredero segun el testamento.
Creo que no es obice para la terminacion del expediente el hecho de que la administradora no ha
presentado hasta ahora el inventario de los bienes; pues, segun la ley, estan exentos de esta formalidad
os administradores que son legatarios del residuo o remanente de los bienes y hayan prestado fianza
para responder de las gestiones de su cargo, y aparece en el testamento que la administradora Alejandra
Austria reune dicha condicion.

POR TODO LO EXPUESTO, el juzgado declara, 1.o: no haber lugar a la mocion de Ramon Ventenilla y
otros; 2.o, declara asimismo que los unicos herederos del finado Antonio Ventenilla son su esposa
Alejandra Austria, Maria Ventenilla, hermana del testador, y Ramon Ventenilla, Maria Ventenilla, Ramon
Soriano, Eulalio Soriano, Jose Soriano, Gabriela Ventenilla, Lorenzo Ventenilla, Felicitas Ventenilla,
Eugenio Ventenilla y Alejandra Ventenilla, en representacion de los difuntos Juan, Tomas, Catalino y
Froilan, hermanos del testador, declarando, ademas que la heredera Alejandra Austria tiene derecho al
remanente de todos los bienes dejados por el finado, despues de deducir de ellos la porcion que
corresponde a cada uno de sus coherederos, conforme esta mandado en las clausulas 8.a, 9.a, 10.a,
11.a, 12.a y 13.a del testamento; 3.o, se aprueba el pago hecho por la administradora de los gastos de la
ultima enfermedad y funerales del testador, de la donacion hecha por el testador a favor de la Escuela a
Publica del Municipio de Mangatarem, y de las misas en sufragio del alma del finado; 4.o, que una vez
prestada la fianza mencionada al principio de este auto, se haga la entrega y adjudicacion de los bienes,
conforme se dispone en el testamento y se acaba de declarar en este auto; 5.o, y, finalmente, que
verificada la adjudicacion, se dara por terminada la administracion, revelandole toda responsabilidad a la
administradora, y cancelando su fianza.

ASI SE ORDENA.

Undoubtedly, after the issuance of an order of such tenor, the closure of any proceedings for the
settlement of the estate of a deceased person cannot be but perfunctory.
In the case at bar, as already pointed out above, the two orders relied upon by petitioner do not
appear ex-facie to be of the same tenor and nature as the order just quoted, and, what is more, the
circumstances attendant to its issuance do not suggest that such was the intention of the court, for
nothing could have been more violative of the will of Mrs. Hodges.
Indeed, to infer from Hodges’ said motions and from his statements of accounts for the years 1958, 1959
and 1960, A Annexes I, K and M, respectively, wherein he repeatedly claimed that “herein executor
(being) the only devisee or legatee of the deceased, in accordance with the last will and testament
already probated,” there is “no (other) person interested in the Philippines of the time and place of
examining herein account to be given notice”, an intent to adjudicate unto himself the whole of his wife’s
estate in an absolute manner and without regard to the contingent interests of her brothers and sisters, is
to impute bad faith to him, an imputation which is not legally permissible, much less warranted by the
facts of record herein. Hodges knew or ought to have known that, legally speaking, the terms of his wife’s
will did not give him such a right. Factually, there are enough circumstances extant in the records of these
cases indicating that he had no such intention to ignore the rights of his co-heirs. In his very motions in
question, Hodges alleged, thru counsel, that the “deceased Linnie Jane Hodges died leaving no
descendants and ascendants, except brothers and sisters and herein petitioner, as surviving spouse, to
inherit the properties of the decedent“, and even promised that “proper accounting will be had — in all
these transactions” which he had submitted for approval and authorization by the court, thereby implying
that he was aware of his responsibilities vis-a-vis his co-heirs. As alleged by respondent Magno in her
brief as appellee:
Under date of April 14, 1959, C. N. Hodges filed his first “Account by the Executor” of the estate of Linnie
Jane Hodges. In the “Statement of Networth of Mr. C. N. Hodges and the Estate of Linnie Jane Hodges”
as of December 31, 1958 annexed thereto, C. N. Hodges reported that the combined conjugal estate
earned a net income of P328,402.62, divided evenly between him and the estate of Linnie Jane Hodges.
Pursuant to this, he filed an “individual income tax return” for calendar year 1958 on the estate of Linnie
Jane Hodges reporting, under oath, the said estate as having earned income of P164,201.31, exactly
one-half of the net income of his combined personal assets and that of the estate of Linnie Jane Hodges.
(p. 91, Appellee’s Brief.)

Under date of July 21, 1960, C. N. Hodges filed his second “Annual Statement of Account by the
Executor” of the estate of Linnie Jane Hodges. In the “Statement of Networth of Mr. C. N. Hodges and the
Estate of Linnie Jane Hodges” as of December 31, 1959 annexed thereto, C. N. Hodges reported that the
combined conjugal estate earned a net income of P270,623.32, divided evenly between him and the
estate of Linnie Jane Hodges. Pursuant to this, he filed an “individual income tax return” for calendar year
1959 on the estate of Linnie Jane Hodges reporting, under oath, the said estate as having earned income
of P135,311.66, exactly one-half of the net income of his combined personal assets and that of the estate
of Linnie Jane Hodges. (pp. 91-92, id.)
Under date of April 20, 1961, C. N. Hodges filed his third “Annual Statement of Account by the Executor
for the year 1960″ of the estate of Linnie Jane Hodges. In the “Statement of Net Worth of Mr. C. N.
Hodges and the Estate of Linnie Jane Hodges” as of December 31, 1960 annexed thereto, C. N. Hodges
reported that the combined conjugal estate earned a net income of P314,857.94, divided of Linnie Jane
Hodges. Pursuant to this, he filed an “individual evenly between him and the estate income tax return” for
calendar year 1960 on the estate of Linnie Jane Hodges reporting, under oath, the said estate as having
earned income of P157,428.97, exactly one-half of the net income of his combined personal assets and
that of the estate of Linnie Jane Hodges. (pp. 92-93, id.)
In the petition for probate that he (Hodges) filed, he listed the seven brothers and sisters of Linnie Jane as
her “heirs” (see p. 2, Green ROA). The order of the court admitting the will to probate unfortunately
omitted one of the heirs, Roy Higdon (see p. 14, Green ROA). Immediately, C. N. Hodges filed a verified
motion to have Roy Higdon’s name included as an heir, stating that he wanted to straighten the records
“in order (that) the heirs of deceased Roy Higdon may not think or believe they were omitted, and that
they were really and are interested in the estate of deceased Linnie Jane Hodges”.

Thus, he recognized, if in his own way, the separate identity of his wife’s estate from his own share of the
conjugal partnership up to the time of his death, more than five years after that of his wife. He never
considered the whole estate as a single one belonging exclusively to himself. The only conclusion one
can gather from this is that he could have been preparing the basis for the eventual transmission of his
wife’s estate, or, at least, so much thereof as he would not have been able to dispose of during his
lifetime, to her brothers and sisters in accordance with her expressed desire, as intimated in his tax return
in the United States to be more extensively referred to anon. And assuming that he did pay the
corresponding estate and inheritance taxes in the Philippines on the basis of his being sole heir, such
payment is not necessarily inconsistent with his recognition of the rights of his co-heirs. Without
purporting to rule definitely on the matter in these proceedings, We might say here that We are inclined to
the view that under the peculiar provisions of his wife’s will, and for purposes of the applicable inheritance
tax laws, Hodges had to be considered as her sole heir, pending the actual transmission of the remaining
portion of her estate to her other heirs, upon the eventuality of his death, and whatever adjustment might
be warranted should there be any such remainder then is a matter that could well be taken care of by the
internal revenue authorities in due time.

It is to be noted that the lawyer, Atty. Leon P. Gellada, who signed the motions of May 27, 1957 and
December 11, 1957 and the aforementioned statements of account was the very same one who also
subsequently signed and filed the motion of December 26, 1962 for the appointment of respondent
Magno as “Administratrix of the Estate of Mrs. Linnie Jane Hodges” wherein it was alleged that “in
accordance with the provisions of the last will and testament of Linnie Jane Hodges, whatever real
properties that may remain at the death of her husband, Charles Newton Hodges, the said properties
shall be equally divided among their heirs.” And it appearing that said attorney was Hodges’ lawyer as
Executor of the estate of his wife, it stands to reason that his understanding of the situation, implicit in his
allegations just quoted, could somehow be reflective of Hodges’ own understanding thereof.

As a matter of fact, the allegations in the motion of the same Atty. Gellada dated July 1, 1957, a “Request
for Inclusion of the Name of Roy Higdon in the Order of the Court dated July 19, 1957, etc.”, reference to
which is made in the above quotation from respondent Magno’s brief, are over the oath of Hodges
himself, who verified the motion. Said allegations read:
1. — That the Hon. Court issued orders dated June 29, 1957, ordering the probate of the will.

2. — That in said order of the Hon. Court, the relatives of the deceased Linnie Jane Hodges were
enumerated. However, in the petition as well as in the testimony of Executor during the hearing, the name
Roy Higdon was mentioned, but deceased. It was unintentionally omitted the heirs of said Roy Higdon
who are his wife Aline Higdon and son David Higdon, all of age, and residents of Quinlan, Texas, U.S.A.

3. — That to straighten the records, and in order the heirs of deceased Roy Higdon may not think or
believe they were omitted, and that they were really and are interested in the estate of deceased Linnie
Jane Hodges, it is requested of the Hon. Court to insert the names of Aline Higdon and David Higdon,
wife and son of deceased Roy Higdon in the said order of the Hon. Court dated June 29, 1957. (pars. 1 to
3, Annex 2 of Magno’s Answer — Record, p. 260)
As can be seen, these italicized allegations indicate, more or less, the real attitude of Hodges in regard to
the testamentary dispositions of his wife.

In connection with this point of Hodges’ intent, We note that there are documents, copies of which are
annexed to respondent Magno’s answer, which purportedly contain Hodges’ own solemn declarations
recognizing the right of his co-heirs, such as the alleged tax return he filed with the United States Taxation
authorities, identified as Schedule M, (Annex 4 of her answer) and his supposed affidavit of renunciation,
Annex 5. In said Schedule M, Hodges appears to have answered the pertinent question thus:

2a. Had the surviving spouse the right to declare an election between (1) the provisions made in his or
her favor by the will and (11) dower, curtesy or a statutory interest? (X) Yes ( ) No

2d. Does the surviving spouse contemplate renouncing the will and electing to take dower, curtesy, or a
statutory interest? (X) Yes ( ) No

3. According to the information and belief of the person or persons filing the return, is any action
described under question 1 designed or contemplated? ( ) Yes (X) No (Annex 4, Answer — Record, p.
263)

and to have further stated under the item, “Description of property interests passing to surviving spouse”
the following:

None, except for purposes of administering the Estate, paying debts, taxes and other legal charges. It is
the intention of the surviving husband of deceased to distribute the remaining property and interests of
the deceased in their Community Estate to the devisees and legatees named in the will when the debts,
liabilities, taxes and expenses of administration are finally determined and paid. (Annex 4, Answer —
Record, p. 263)
In addition, in the supposed affidavit of Hodges, Annex 5, it is stated:

I, C. N. Hodges, being duly sworn, on oath affirm that at the time the United States Estate Tax Return was
filed in the Estate of Linnie Jane Hodges on August 8, 1958, I renounced and disclaimed any and all right
to receive the rents, emoluments and income from said estate, as shown by the statement contained in
Schedule M at page 29 of said return, a copy of which schedule is attached to this affidavit and made a
part hereof.

The purpose of this affidavit is to ratify and confirm, and I do hereby ratify and confirm, the declaration
made in Schedule M of said return and hereby formally disclaim and renounce any right on my part to
receive any of the said rents, emoluments and income from the estate of my deceased wife, Linnie Jane
Hodges. This affidavit is made to absolve me or my estate from any liability for the payment of income
taxes on income which has accrued to the estate of Linnie Jane Hodges since the death of the said Linnie
Jane Hodges on May 23, 1957. (Annex 5, Answer — Record, p. 264)
Although it appears that said documents were not duly presented as evidence in the court below, and We
cannot, therefore, rely on them for the purpose of the present proceedings, still, We cannot close our eyes
to their existence in the record nor fail to note that their tenor jibes with Our conclusion discussed above
from the circumstances related to the orders of May 27 and December 14, 1957. 5 Somehow, these
documents, considering they are supposed to be copies of their originals found in the official files of the
governments of the United States and of the Philippines, serve to lessen any possible apprehension that
Our conclusion from the other evidence of Hodges’ manifest intent vis-a-vis the rights of his co-heirs is
without basis in fact.

Verily, with such eloquent manifestations of his good intentions towards the other heirs of his wife, We
find it very hard to believe that Hodges did ask the court and that the latter agreed that he be declared her
sole heir and that her whole estate be adjudicated to him without so much as just annotating the
contingent interest of her brothers and sisters in what would remain thereof upon his demise. On the
contrary, it seems to us more factual and fairer to assume that Hodges was well aware of his position as
executor of the will of his wife and, as such, had in mind the following admonition made by the Court
in Pamittan vs. Lasam, et al., 60 Phil., 908, at pp. 913-914:
Upon the death of Bernarda in September, 1908, said lands continued to be conjugal property in the
hands of the defendant Lasam. It is provided in article 1418 of the Civil Code that upon the dissolution of
the conjugal partnership, an inventory shall immediately be made and this court in construing this
provision in connection with section 685 of the Code of Civil Procedure (prior to its amendment by Act No.
3176 of November 24, 1924) has repeatedly held that in the event of the death of the wife, the law
imposes upon the husband the duty of liquidating the affairs of the partnership without delay (desde
luego) (Alfonso vs. Natividad, 6 Phil., 240; Prado vs. Lagera, 7 Phil., 395; De la Rama vs. De la Rama, 7
Phil., 745; Enriquez vs. Victoria, 10 Phil., 10; Amancio vs. Pardo, 13 Phil., 297; Rojas vs. Singson
Tongson, 17 Phil., 476; Sochayseng vs. Trujillo, 31 Phil., 153; Molera vs. Molera, 40 Phil., 566; Nable
Jose vs. Nable Jose, 41 Phil., 713.)

In the last mentioned case this court quoted with approval the case of Leatherwood vs. Arnold (66 Texas,
414, 416, 417), in which that court discussed the powers of the surviving spouse in the administration of
the community property. Attention was called to the fact that the surviving husband, in the management of
the conjugal property after the death of the wife, was a trustee of unique character who is liable for any
fraud committed by him with relation to the property while he is charged with its administration. In the
liquidation of the conjugal partnership, he had wide powers (as the law stood prior to Act No. 3176) and
the high degree of trust reposed in him stands out more clearly in view of the fact that he was the owner
of a half interest in his own right of the conjugal estate which he was charged to administer. He could
therefore no more acquire a title by prescription against those for whom he was administering the
conjugal estate than could a guardian against his ward or a judicial administrator against the heirs of
estate. Section 38 of Chapter III of the Code of Civil Procedure, with relation to prescription, provides that
“this chapter shall not apply … in the case of a continuing and subsisting trust.” The surviving husband in
the administration and liquidation of the conjugal estate occupies the position of a trustee of the highest
order and is not permitted by the law to hold that estate or any portion thereof adversely to those for
whose benefit the law imposes upon him the duty of administration and liquidation. No liquidation was
ever made by Lasam — hence, the conjugal property which came into his possession on the death of his
wife in September, 1908, still remains conjugal property, a continuing and subsisting trust. He should
have made a liquidation immediately (desde luego). He cannot now be permitted to take advantage of his
own wrong. One of the conditions of title by prescription (section 41, Code of Civil Procedure) is
possession “under a claim of title exclusive of any other right”. For a trustee to make such a claim would
be a manifest fraud.
And knowing thus his responsibilities in the premises, We are not convinced that Hodges arrogated
everything unto himself leaving nothing at all to be inherited by his wife’s brothers and sisters.

PCIB insists, however, that to read the orders of May 27 and December 14, 1957, not as adjudicatory, but
merely as approving past and authorizing future dispositions made by Hodges in a wholesale and general
manner, would necessarily render the said orders void for being violative of the provisions of Rule 89
governing the manner in which such dispositions may be made and how the authority therefor and
approval thereof by the probate court may be secured. If We sustained such a view, the result would only
be that the said orders should be declared ineffective either way they are understood, considering We
have already seen it is legally impossible to consider them as adjudicatory. As a matter of fact, however,
what surges immediately to the surface, relative to PCIB’s observations based on Rule 89, is that from
such point of view, the supposed irregularity would involve no more than some non-jurisdictional
technicalities of procedure, which have for their evident fundamental purpose the protection of parties
interested in the estate, such as the heirs, its creditors, particularly the government on account of the
taxes due it; and since it is apparent here that none of such parties are objecting to said orders or would
be prejudiced by the unobservance by the trial court of the procedure pointed out by PCIB, We find no
legal inconvenience in nor impediment to Our giving sanction to the blanket approval and authority
contained in said orders. This solution is definitely preferable in law and in equity, for to view said orders
in the sense suggested by PCIB would result in the deprivation of substantive rights to the brothers and
sisters of Mrs. Hodges, whereas reading them the other way will not cause any prejudice to anyone, and,
withal, will give peace of mind and stability of rights to the innocent parties who relied on them in good
faith, in the light of the peculiar pertinent provisions of the will of said decedent.
Now, the inventory submitted by Hodges on May 12, 1958 referred to the estate of his wife as consisting
of “One-half of all the items designated in the balance sheet, copy of which is hereto attached and marked
as “Annex A”.” Although, regrettably, no copy of said Annex A appears in the records before Us, We take
judicial notice, on the basis of the undisputed facts in these cases, that the same consists of considerable
real and other personal kinds of properties. And since, according to her will, her husband was to be the
sole owner thereof during his lifetime, with full power and authority to dispose of any of them, provided
that should there be any remainder upon his death, such remainder would go to her brothers and sisters,
and furthermore, there is no pretension, much less any proof that Hodges had in fact disposed of all of
them, and, on the contrary, the indications are rather to the effect that he had kept them more or less
intact, it cannot truthfully be said that, upon the death of Hodges, there was no more estate of Mrs.
Hodges to speak of. It is Our conclusion, therefore, that properties do exist which constitute such estate,
hence Special Proceedings 1307 should not yet be closed.

Neither is there basis for holding that respondent Magno has ceased to be the Administratrix in said
proceeding. There is no showing that she has ever been legally removed as such, the attempt to replace
her with Mr. Benito Lopez without authority from the Court having been expressly held ineffective by Our
resolution of September 8, 1972. Parenthetically, on this last point, PCIB itself is very emphatic in
stressing that it is not questioning said respondent’s status as such administratrix. Indeed, it is not clear
that PCIB has any standing to raise any objection thereto, considering it is a complete stranger insofar as
the estate of Mrs. Hodges is concerned.

It is the contention of PCIB, however, that as things actually stood at the time of Hodges’ death, their
conjugal partnership had not yet been liquidated and, inasmuch as the properties composing the same
were thus commingled pro indiviso and, consequently, the properties pertaining to the estate of each of
the spouses are not yet identifiable, it is PCIB alone, as administrator of the estate of Hodges, who should
administer everything, and all that respondent Magno can do for the time being is to wait until the
properties constituting the remaining estate of Mrs. Hodges have been duly segregated and delivered to
her for her own administration. Seemingly, PCIB would liken the Testate Estate of Linnie Jane Hodges to
a party having a claim of ownership to some properties included in the inventory of an administrator of the
estate of a decedent, (here that of Hodges) and who normally has no right to take part in the proceedings
pending the establishment of his right or title; for which as a rule it is required that an ordinary action
should be filed, since the probate court is without jurisdiction to pass with finality on questions of title
between the estate of the deceased, on the one hand, and a third party or even an heir claiming
adversely against the estate, on the other.

We do not find such contention sufficiently persuasive. As We see it, the situation obtaining herein cannot
be compared with the claim of a third party the basis of which is alien to the pending probate proceedings.
In the present cases what gave rise to the claim of PCIB of exclusive ownership by the estate of Hodges
over all the properties of the Hodges spouses, including the share of Mrs. Hodges in the community
properties, were the orders of the trial court issued in the course of the very settlement proceedings
themselves, more specifically, the orders of May 27 and December 14, 1957 so often mentioned above.
In other words, the root of the issue of title between the parties is something that the court itself has done
in the exercise of its probate jurisdiction. And since in the ultimate analysis, the question of whether or not
all the properties herein involved pertain exclusively to the estate of Hodges depends on the legal
meaning and effect of said orders, the claim that respondent court has no jurisdiction to take cognizance
of and decide the said issue is incorrect. If it was within the competence of the court to issue the root
orders, why should it not be within its authority to declare their true significance and intent, to the end that
the parties may know whether or not the estate of Mrs. Hodges had already been adjudicated by the
court, upon the initiative of Hodges, in his favor, to the exclusion of the other heirs of his wife instituted in
her will?

At this point, it bears emphasis again that the main cause of all the present problems confronting the
courts and the parties in these cases was the failure of Hodges to secure, as executor of his wife’s estate,
from May, 1957 up to the time of his death in December, 1962, a period of more than five years, the final
adjudication of her estate and the closure of the proceedings. The record is bare of any showing that he
ever exerted any effort towards the early settlement of said estate. While, on the one hand, there are
enough indications, as already discuss that he had intentions of leaving intact her share of the conjugal
properties so that it may pass wholly to his co-heirs upon his death, pursuant to her will, on the other
hand, by not terminating the proceedings, his interests in his own half of the conjugal properties remained
commingled pro-indiviso with those of his co-heirs in the other half. Obviously, such a situation could not
be conducive to ready ascertainment of the portion of the inheritance that should appertain to his co-heirs
upon his death. Having these considerations in mind, it would be giving a premium for such
procrastination and rather unfair to his co-heirs, if the administrator of his estate were to be given
exclusive administration of all the properties in question, which would necessarily include the function of
promptly liquidating the conjugal partnership, thereby identifying and segregating without unnecessary
loss of time which properties should be considered as constituting the estate of Mrs. Hodges, the
remainder of which her brothers and sisters are supposed to inherit equally among themselves.

To be sure, an administrator is not supposed to represent the interests of any particular party and his acts
are deemed to be objectively for the protection of the rights of everybody concerned with the estate of the
decedent, and from this point of view, it maybe said that even if PCIB were to act alone, there should be
no fear of undue disadvantage to anyone. On the other hand, however, it is evidently implicit in section 6
of Rule 78 fixing the priority among those to whom letters of administration should be granted that the
criterion in the selection of the administrator is not his impartiality alone but, more importantly, the extent
of his interest in the estate, so much so that the one assumed to have greater interest is preferred to
another who has less. Taking both of these considerations into account, inasmuch as, according to
Hodges’ own inventory submitted by him as Executor of the estate of his wife, practically all their
properties were conjugal which means that the spouses have equal shares therein, it is but logical that
both estates should be administered jointly by representatives of both, pending their segregation from
each other. Particularly is such an arrangement warranted because the actuations so far of PCIB evince a
determined, albeit groundless, intent to exclude the other heirs of Mrs. Hodges from their inheritance.
Besides, to allow PCIB, the administrator of his estate, to perform now what Hodges was duty bound to
do as executor is to violate the spirit, if not the letter, of Section 2 of Rule 78 which expressly provides that
“The executor of an executor shall not, as such, administer the estate of the first testator.” It goes without
saying that this provision refers also to the administrator of an executor like PCIB here.

We are not unmindful of the fact that under Section 2 of Rule 73, “When the marriage is dissolved by the
death of the husband or wife, the community property shall be inventoried, administered, and liquidated,
and the debts thereof paid, in the testate or intestate proceedings of the deceased spouse. If both
spouses have died, the conjugal partnership shall be liquidated in the testate or intestate proceedings of
either.” Indeed, it is true that the last sentence of this provision allows or permits the conjugal partnership
of spouses who are both deceased to be settled or liquidated in the testate or intestate proceedings of
either, but precisely because said sentence allows or permits that the liquidation be made in either
proceeding, it is a matter of sound judicial discretion in which one it should be made. After all, the former
rule referring to the administrator of the husband’s estate in respect to such liquidation was done away
with by Act 3176, the pertinent provisions of which are now embodied in the rule just cited.

Thus, it can be seen that at the time of the death of Hodges, there was already the pending judicial
settlement proceeding of the estate of Mrs. Hodges, and, more importantly, that the former was the
executor of the latter’s will who had, as such, failed for more than five years to see to it that the same was
terminated earliest, which was not difficult to do, since from ought that appears in the record, there were
no serious obstacles on the way, the estate not being indebted and there being no immediate heirs other
than Hodges himself. Such dilatory or indifferent attitude could only spell possible prejudice of his co-
heirs, whose rights to inheritance depend entirely on the existence of any remainder of Mrs. Hodges’
share in the community properties, and who are now faced with the pose of PCIB that there is no such
remainder. Had Hodges secured as early as possible the settlement of his wife’s estate, this problem
would not arisen. All things considered, We are fully convinced that the interests of justice will be better
served by not permitting or allowing PCIB or any administrator of the estate of Hodges exclusive
administration of all the properties in question. We are of the considered opinion and so hold that what
would be just and proper is for both administrators of the two estates to act conjointly until after said
estates have been segregated from each other.

At this juncture, it may be stated that we are not overlooking the fact that it is PCIB’s contention that,
viewed as a substitution, the testamentary disposition in favor of Mrs. Hodges’ brothers and sisters may
not be given effect. To a certain extent, this contention is correct. Indeed, legally speaking, Mrs. Hodges’
will provides neither for a simple or vulgar substitution under Article 859 of the Civil Code nor for a
fideicommissary substitution under Article 863 thereof. There is no vulgar substitution therein because
there is no provision for either (1) predecease of the testator by the designated heir or (2) refusal or (3)
incapacity of the latter to accept the inheritance, as required by Article 859; and neither is there a
fideicommissary substitution therein because no obligation is imposed thereby upon Hodges to preserve
the estate or any part thereof for anyone else. But from these premises, it is not correct to jump to the
conclusion, as PCIB does, that the testamentary dispositions in question are therefore inoperative and
invalid.
The error in PCIB’s position lies simply in the fact that it views the said disposition exclusively in the light
of substitutions covered by the Civil Code section on that subject, (Section 3, Chapter 2, Title IV, Book III)
when it is obvious that substitution occurs only when another heir is appointed in a will “so that he may
enter into inheritance in default of the heir originally instituted,” (Article 857, id.) and, in the present case,
no such possible default is contemplated. The brothers and sisters of Mrs. Hodges are not substitutes for
Hodges because, under her will, they are not to inherit what Hodges cannot, would not or may not inherit,
but what he would not dispose of from his inheritance; rather, therefore, they are also heirs instituted
simultaneously with Hodges, subject, however, to certain conditions, partially resolutory insofar as
Hodges was concerned and correspondingly suspensive with reference to his brothers and sisters-in-law.
It is partially resolutory, since it bequeaths unto Hodges the whole of her estate to be owned and enjoyed
by him as universal and sole heir with absolute dominion over them 6only during his lifetime, which means
that while he could completely and absolutely dispose of any portion thereof inter vivos to anyone other
than himself, he was not free to do so mortis causa, and all his rights to what might remain upon his death
would cease entirely upon the occurrence of that contingency, inasmuch as the right of his brothers and
sisters-in-law to the inheritance, although vested already upon the death of Mrs. Hodges, would
automatically become operative upon the occurrence of the death of Hodges in the event of actual
existence of any remainder of her estate then.
Contrary to the view of respondent Magno, however, it was not the usufruct alone of her estate, as
contemplated in Article 869 of the Civil Code, that she bequeathed to Hodges during his lifetime, but the
full ownership thereof, although the same was to last also during his lifetime only, even as there was no
restriction whatsoever against his disposing or conveying the whole or any portion thereof to anybody
other than himself. The Court sees no legal impediment to this kind of institution, in this jurisdiction or
under Philippine law, except that it cannot apply to the legitime of Hodges as the surviving spouse,
consisting of one-half of the estate, considering that Mrs. Hodges had no surviving ascendants nor
descendants. (Arts. 872, 900, and 904, New Civil Code.)

But relative precisely to the question of how much of Mrs. Hodges’ share of the conjugal partnership
properties may be considered as her estate, the parties are in disagreement as to how Article 16 of the
Civil Code 7should be applied. On the one hand, petitioner claims that inasmuch as Mrs. Hodges was a
resident of the Philippines at the time of her death, under said Article 16, construed in relation to the
pertinent laws of Texas and the principle of renvoi, what should be applied here should be the rules of
succession under the Civil Code of the Philippines, and, therefore, her estate could consist of no more
than one-fourth of the said conjugal properties, the other fourth being, as already explained, the legitime
of her husband (Art. 900, Civil Code) which she could not have disposed of nor burdened with any
condition (Art. 872, Civil Code). On the other hand, respondent Magno denies that Mrs. Hodges died a
resident of the Philippines, since allegedly she never changed nor intended to change her original
residence of birth in Texas, United States of America, and contends that, anyway, regardless of the
question of her residence, she being indisputably a citizen of Texas, under said Article 16 of the Civil
Code, the distribution of her estate is subject to the laws of said State which, according to her, do not
provide for any legitime, hence, the brothers and sisters of Mrs. Hodges are entitled to the remainder of
the whole of her share of the conjugal partnership properties consisting of one-half thereof. Respondent
Magno further maintains that, in any event, Hodges had renounced his rights under the will in favor of his
co-heirs, as allegedly proven by the documents touching on the point already mentioned earlier, the
genuineness and legal significance of which petitioner seemingly questions. Besides, the parties are
disagreed as to what the pertinent laws of Texas provide. In the interest of settling the estates herein
involved soonest, it would be best, indeed, if these conflicting claims of the parties were determined in
these proceedings. The Court regrets, however, that it cannot do so, for the simple reason that neither the
evidence submitted by the parties in the court below nor their discussion, in their respective briefs and
memoranda before Us, of their respective contentions on the pertinent legal issues, of grave importance
as they are, appear to Us to be adequate enough to enable Us to render an intelligent comprehensive
and just resolution. For one thing, there is no clear and reliable proof of what in fact the possibly
applicable laws of Texas are. 7* Then also, the genuineness of documents relied upon by respondent
Magno is disputed. And there are a number of still other conceivable related issues which the parties may
wish to raise but which it is not proper to mention here. In Justice, therefore, to all the parties concerned,
these and all other relevant matters should first be threshed out fully in the trial court in the proceedings
hereafter to be held therein for the purpose of ascertaining and adjudicating and/or distributing the estate
of Mrs. Hodges to her heirs in accordance with her duly probated will.
To be more explicit, all that We can and do decide in connection with the petition for certiorari and
prohibition are: (1) that regardless of which corresponding laws are applied, whether of the Philippines or
of Texas, and taking for granted either of the respective contentions of the parties as to provisions of the
latter, 8and regardless also of whether or not it can be proven by competent evidence that Hodges
renounced his inheritance in any degree, it is easily and definitely discernible from the inventory submitted
by Hodges himself, as Executor of his wife’s estate, that there are properties which should constitute the
estate of Mrs. Hodges and ought to be disposed of or distributed among her heirs pursuant to her will in
said Special Proceedings 1307; (2) that, more specifically, inasmuch as the question of what are the
pertinent laws of Texas applicable to the situation herein is basically one of fact, and, considering that the
sole difference in the positions of the parties as to the effect of said laws has reference to the supposed
legitime of Hodges — it being the stand of PCIB that Hodges had such a legitime whereas Magno claims
the negative – it is now beyond controversy for all future purposes of these proceedings that whatever be
the provisions actually of the laws of Texas applicable hereto, the estate of Mrs. Hodges is at least, one-
fourth of the conjugal estate of the spouses; the existence and effects of foreign laws being questions of
fact, and it being the position now of PCIB that the estate of Mrs. Hodges, pursuant to the laws of Texas,
should only be one-fourth of the conjugal estate, such contention constitutes an admission of fact, and
consequently, it would be in estoppel in any further proceedings in these cases to claim that said estate
could be less, irrespective of what might be proven later to be actually the provisions of the applicable
laws of Texas; (3) that Special Proceedings 1307 for the settlement of the testate estate of Mrs. Hodges
cannot be closed at this stage and should proceed to its logical conclusion, there having been no proper
and legal adjudication or distribution yet of the estate therein involved; and (4) that respondent Magno
remains and continues to be the Administratrix therein. Hence, nothing in the foregoing opinion is
intended to resolve the issues which, as already stated, are not properly before the Court now, namely,
(1) whether or not Hodges had in fact and in law waived or renounced his inheritance from Mrs. Hodges,
in whole or in part, and (2) assuming there had been no such waiver, whether or not, by the application of
Article 16 of the Civil Code, and in the light of what might be the applicable laws of Texas on the matter,
the estate of Mrs. Hodges is more than the one-fourth declared above. As a matter of fact, even our
finding above about the existence of properties constituting the estate of Mrs. Hodges rests largely on a
general appraisal of the size and extent of the conjugal partnership gathered from reference made thereto
by both parties in their briefs as well as in their pleadings included in the records on appeal, and it should
accordingly yield, as to which exactly those properties are, to the more concrete and specific evidence
which the parties are supposed to present in support of their respective positions in regard to the
foregoing main legal and factual issues. In the interest of justice, the parties should be allowed to present
such further evidence in relation to all these issues in a joint hearing of the two probate proceedings
herein involved. After all, the court a quo has not yet passed squarely on these issues, and it is best for all
concerned that it should do so in the first instance.
Relative to Our holding above that the estate of Mrs. Hodges cannot be less than the remainder of one-
fourth of the conjugal partnership properties, it may be mentioned here that during the deliberations, the
point was raised as to whether or not said holding might be inconsistent with Our other ruling here also
that, since there is no reliable evidence as to what are the applicable laws of Texas, U.S.A. “with respect
to the order of succession and to the amount of successional rights” that may be willed by a testator
which, under Article 16 of the Civil Code, are controlling in the instant cases, in view of the undisputed
Texan nationality of the deceased Mrs. Hodges, these cases should be returned to the court a quo, so
that the parties may prove what said law provides, it is premature for Us to make any specific ruling now
on either the validity of the testamentary dispositions herein involved or the amount of inheritance to
which the brothers and sisters of Mrs. Hodges are entitled. After nature reflection, We are of the
considered view that, at this stage and in the state of the records before Us, the feared inconsistency is
more apparent than real. Withal, it no longer lies in the lips of petitioner PCIB to make any claim that
under the laws of Texas, the estate of Mrs. Hodges could in any event be less than that We have fixed
above.

It should be borne in mind that as above-indicated, the question of what are the laws of Texas governing
the matters herein issue is, in the first instance, one of fact, not of law. Elementary is the rule that foreign
laws may not be taken judicial notice of and have to be proven like any other fact in dispute between the
parties in any proceeding, with the rare exception in instances when the said laws are already within the
actual knowledge of the court, such as when they are well and generally known or they have been
actually ruled upon in other cases before it and none of the parties concerned do not claim otherwise. (5
Moran, Comments on the Rules of Court, p. 41, 1970 ed.) In Fluemer vs. Hix, 54 Phil. 610, it was held:
It is the theory of the petitioner that the alleged will was executed in Elkins West Virginia, on November 3,
1925, by Hix who had his residence in that jurisdiction, and that the laws of West Virginia govern. To this
end, there was submitted a copy of section 3868 of Acts 1882, c. 84 as found in West Virginia Code,
Annotated, by Hogg Charles E., vol. 2, 1914, p. 1960, and as certified to by the Director of the National
Library. But this was far from a compliance with the law. The laws of a foreign jurisdiction do not prove
themselves in our courts. The courts of the Philippine Islands are not authorized to take judicial notice of
the laws of the various States of the American Union. Such laws must be proved as facts. (In re Estate of
Johnson [1918], 39 Phil., 156.) Here the requirements of the law were not met. There was no showing
that the book from which an extract was taken was printed or published under the authority of the State of
West Virginia, as provided in section 300 of the Code of Civil Procedure. Nor was the extract from the law
attested by the certificate of the officer having charge of the original, under the seal of the State of West
Virginia, as provided in section 301 of the Code of Civil Procedure. No evidence was introduced to show
that the extract from the laws of West Virginia was in force at the time the alleged will was executed.”

No evidence of the nature thus suggested by the Court may be found in the records of the cases at bar.
Quite to the contrary, the parties herein have presented opposing versions in their respective pleadings
and memoranda regarding the matter. And even if We took into account that in Aznar vs. Garcia, the
Court did make reference to certain provisions regarding succession in the laws of Texas, the disparity in
the material dates of that case and the present ones would not permit Us to indulge in the hazardous
conjecture that said provisions have not been amended or changed in the meantime.
On the other hand, in In re Estate of Johnson, 39 Phil. 156, We held:

Upon the other point — as to whether the will was executed in conformity with the statutes of the State of
Illinois — we note that it does not affirmatively appear from the transcription of the testimony adduced in
the trial court that any witness was examined with reference to the law of Illinois on the subject of the
execution of will. The trial judge no doubt was satisfied that the will was properly executed by examining
section 1874 of the Revised Statutes of Illinois, as exhibited in volume 3 of Starr & Curtis’s Annotated
Illinois Statutes, 2nd ed., p. 426; and he may have assumed that he could take judicial notice of the laws
of Illinois under section 275 of the Code of Civil Procedure. If so, he was in our opinion mistaken. That
section authorizes the courts here to take judicial notice, among other things, of the acts of the legislative
department of the United States. These words clearly have reference to Acts of the Congress of the
United States; and we would hesitate to hold that our courts can, under this provision, take judicial notice
of the multifarious laws of the various American States. Nor do we think that any such authority can be
derived from the broader language, used in the same section, where it is said that our courts may take
judicial notice of matters of public knowledge “similar” to those therein enumerated. The proper rule we
think is to require proof of the statutes of the States of the American Union whenever their provisions are
determinative of the issues in any action litigated in the Philippine courts.

Nevertheless, even supposing that the trial court may have erred in taking judicial notice of the law of
Illinois on the point in question, such error is not now available to the petitioner, first, because the petition
does not state any fact from which it would appear that the law of Illinois is different from what the court
found, and, secondly, because the assignment of error and argument for the appellant in this court raises
no question based on such supposed error. Though the trial court may have acted upon pure conjecture
as to the law prevailing in the State of Illinois, its judgment could not be set aside, even upon application
made within six months under section 113 of the Code of Civil Procedure, unless it should be made to
appear affirmatively that the conjecture was wrong. The petitioner, it is true, states in general terms that
the will in question is invalid and inadequate to pass real and personal property in the State of Illinois, but
this is merely a conclusion of law. The affidavits by which the petition is accompanied contain no
reference to the subject, and we are cited to no authority in the appellant’s brief which might tend to raise
a doubt as to the correctness of the conclusion of the trial court. It is very clear, therefore, that this point
cannot be urged as of serious moment.

It is implicit in the above ruling that when, with respect to certain aspects of the foreign laws concerned,
the parties in a given case do not have any controversy or are more or less in agreement, the Court may
take it for granted for the purposes of the particular case before it that the said laws are as such virtual
agreement indicates, without the need of requiring the presentation of what otherwise would be the
competent evidence on the point. Thus, in the instant cases wherein it results from the respective
contentions of both parties that even if the pertinent laws of Texas were known and to be applied, the
amount of the inheritance pertaining to the heirs of Mrs. Hodges is as We have fixed above, the absence
of evidence to the effect that, actually and in fact, under said laws, it could be otherwise is of no longer of
any consequence, unless the purpose is to show that it could be more. In other words, since PCIB, the
petitioner-appellant, concedes that upon application of Article 16 of the Civil Code and the pertinent laws
of Texas, the amount of the estate in controversy is just as We have determined it to be, and respondent-
appellee is only claiming, on her part, that it could be more, PCIB may not now or later pretend differently.

To be more concrete, on pages 20-21 of its petition herein, dated July 31, 1967, PCIB states
categorically:

Inasmuch as Article 16 of the Civil Code provides that “intestate and testamentary successions both with
respect to the order of succession and to the amount of successional rights and to the intrinsic validity of
testamentary provisions, shall be regulated by the national law of the person whose succession is under
consideration, whatever may be the nature of the property and regardless of the country wherein said
property may be found”, while the law of Texas (the Hodges spouses being nationals of U.S.A., State of
Texas), in its conflicts of law rules, provides that the domiciliary law (in this case Philippine law) governs
the testamentary dispositions and successional rights over movables or personal properties, while the law
of the situs (in this case also Philippine law with respect to all Hodges properties located in the
Philippines), governs with respect to immovable properties, and applying therefore the ‘renvoi doctrine’ as
enunciated and applied by this Honorable Court in the case of In re Estate of Christensen (G.R. No. L-
16749, Jan. 31, 1963), there can be no question that Philippine law governs the testamentary dispositions
contained in the Last Will and Testament of the deceased Linnie Jane Hodges, as well as the
successional rights to her estate, both with respect to movables, as well as to immovables situated in the
Philippines.

In its main brief dated February 26, 1968, PCIB asserts:

The law governing successional rights.

As recited above, there is no question that the deceased, Linnie Jane Hodges, was an American citizen.
There is also no question that she was a national of the State of Texas, U.S.A. Again, there is likewise no
question that she had her domicile of choice in the City of Iloilo, Philippines, as this has already been
pronounced by the above-cited orders of the lower court, pronouncements which are by now res
adjudicata (par. [a], See. 49, Rule 39, Rules of Court; In re Estate of Johnson, 39 Phil. 156).
Article 16 of the Civil Code provides:

“Real property as well as personal property is subject to the law of the country where it is situated.

However, intestate and testamentary successions, both with respect to the order of succession and to the
amount of successional rights and to the intrinsic validity of testamentary provisions, shall be regulated by
the national law of the person whose succession is under consideration, whatever may be the nature of
the property and regardless of the country wherein said property may be found.”

Thus the aforecited provision of the Civil Code points towards the national law of the deceased, Linnie
Jane Hodges, which is the law of Texas, as governing succession “both with respect to the order of
succession and to the amount of successional rights and to the intrinsic validity of testamentary provisions
…”. But the law of Texas, in its conflicts of law rules, provides that the domiciliary law governs the
testamentary dispositions and successional rights over movables or personal property, while the law of
the situs governs with respect to immovable property. Such that with respect to both movable property, as
well as immovable property situated in the Philippines, the law of Texas points to the law of the
Philippines.

Applying, therefore, the so-called “renvoi doctrine”, as enunciated and applied by this Honorable Court in
the case of “In re Christensen” (G.R. No. L-16749, Jan. 31, 1963), there can be no question that
Philippine law governs the testamentary provisions in the Last Will and Testament of the deceased Linnie
Jane Hodges, as well as the successional rights to her estate, both with respect to movables, as well as
immovables situated in the Philippines.

The subject of successional rights.

Under Philippine law, as it is under the law of Texas, the conjugal or community property of the spouses,
Charles Newton Hodges and Linnie Jane Hodges, upon the death of the latter, is to be divided into two,
one-half pertaining to each of the spouses, as his or her own property. Thus, upon the death of Linnie
Jane Hodges, one-half of the conjugal partnership property immediately pertained to Charles Newton
Hodges as his own share, and not by virtue of any successional rights. There can be no question about
this.

Again, Philippine law, or more specifically, Article 900 of the Civil Code provides:

If the only survivor is the widow or widower, she or he shall be entitled to one-half of the hereditary estate
of the deceased spouse, and the testator may freely dispose of the other half.

If the marriage between the surviving spouse and the testator was solemnized in articulo mortis, and the
testator died within three months from the time of the marriage, the legitime of the surviving spouse as the
sole heir shall be one-third of the hereditary estate, except when they have been living as husband and
wife for more than five years. In the latter case, the legitime of the surviving spouse shall be that specified
in the preceding paragraph.
This legitime of the surviving spouse cannot be burdened by a fideicommisary substitution (Art. 864, Civil
code), nor by any charge, condition, or substitution (Art, 872, Civil code). It is clear, therefore, that in
addition to one-half of the conjugal partnership property as his own conjugal share, Charles Newton
Hodges was also immediately entitled to one-half of the half conjugal share of the deceased, Linnie Jane
Hodges, or one-fourth of the entire conjugal property, as his legitime.

One-fourth of the conjugal property therefore remains at issue.

In the summary of its arguments in its memorandum dated April 30, 1968, the following appears:

Briefly, the position advanced by the petitioner is:

a. That the Hodges spouses were domiciled legally in the Philippines (pp. 19-20, petition). This is now a
matter of res adjudicata (p. 20, petition).

b. That under Philippine law, Texas law, and the renvoi doctrine, Philippine law governs the successional
rights over the properties left by the deceased, Linnie Jane Hodges (pp. 20-21, petition).

c. That under Philippine as well as Texas law, one-half of the Hodges properties pertains to the
deceased, Charles Newton Hodges (p. 21, petition). This is not questioned by the respondents.

d. That under Philippine law, the deceased, Charles Newton Hodges, automatically inherited one-half of
the remaining one-half of the Hodges properties as his legitime (p. 21, petition).

e. That the remaining 25% of the Hodges properties was inherited by the deceased, Charles Newton
Hodges, under the will of his deceased spouse (pp. 22-23, petition). Upon the death of Charles Newton
Hodges, the substitution ‘provision of the will of the deceased, Linnie Jane Hodges, did not operate
because the same is void (pp. 23-25, petition).

f. That the deceased, Charles Newton Hodges, asserted his sole ownership of the Hodges properties and
the probate court sanctioned such assertion (pp. 25-29, petition). He in fact assumed such ownership and
such was the status of the properties as of the time of his death (pp. 29-34, petition).

Of similar tenor are the allegations of PCIB in some of its pleadings quoted in the earlier part of this
option.

On her part, it is respondent-appellee Magno’s posture that under the laws of Texas, there is no system of
legitime, hence the estate of Mrs. Hodges should be one-half of all the conjugal properties.

It is thus unquestionable that as far as PCIB is concerned, the application to these cases of Article 16 of
the Civil Code in relation to the corresponding laws of Texas would result in that the Philippine laws on
succession should control. On that basis, as We have already explained above, the estate of Mrs.
Hodges is the remainder of one-fourth of the conjugal partnership properties, considering that We have
found that there is no legal impediment to the kind of disposition ordered by Mrs. Hodges in her will in
favor of her brothers and sisters and, further, that the contention of PCIB that the same constitutes an
inoperative testamentary substitution is untenable. As will be recalled, PCIB’s position that there is no
such estate of Mrs. Hodges is predicated exclusively on two propositions, namely: (1) that the provision in
question in Mrs. Hodges’ testament violates the rules on substitution of heirs under the Civil Code and (2)
that, in any event, by the orders of the trial court of May 27, and December 14, 1957, the trial court had
already finally and irrevocably adjudicated to her husband the whole free portion of her estate to the
exclusion of her brothers and sisters, both of which poses, We have overruled. Nowhere in its pleadings,
briefs and memoranda does PCIB maintain that the application of the laws of Texas would result in the
other heirs of Mrs. Hodges not inheriting anything under her will. And since PCIB’s representations in
regard to the laws of Texas virtually constitute admissions of fact which the other parties and the Court
are being made to rely and act upon, PCIB is “not permitted to contradict them or subsequently take a
position contradictory to or inconsistent with them.” (5 Moran, id, p. 65, citing Cunanan vs. Amparo, 80
Phil. 227; Sta. Ana vs. Maliwat, L-23023, Aug. 31, 1968, 24 SCRA 1018).

Accordingly, the only question that remains to be settled in the further proceedings hereby ordered to be
held in the court below is how much more than as fixed above is the estate of Mrs. Hodges, and this
would depend on (1) whether or not the applicable laws of Texas do provide in effect for more, such as,
when there is no legitime provided therein, and (2) whether or not Hodges has validly waived his whole
inheritance from Mrs. Hodges.

In the course of the deliberations, it was brought out by some members of the Court that to avoid or, at
least, minimize further protracted legal controversies between the respective heirs of the Hodges
spouses, it is imperative to elucidate on the possible consequences of dispositions made by Hodges after
the death of his wife from the mass of the unpartitioned estates without any express indication in the
pertinent documents as to whether his intention is to dispose of part of his inheritance from his wife or part
of his own share of the conjugal estate as well as of those made by PCIB after the death of Hodges. After
a long discussion, the consensus arrived at was as follows: (1) any such dispositions made gratuitously in
favor of third parties, whether these be individuals, corporations or foundations, shall be considered as
intended to be of properties constituting part of Hodges’ inheritance from his wife, it appearing from the
tenor of his motions of May 27 and December 11, 1957 that in asking for general authority to make sales
or other disposals of properties under the jurisdiction of the court, which include his own share of the
conjugal estate, he was not invoking particularly his right over his own share, but rather his right to
dispose of any part of his inheritance pursuant to the will of his wife; (2) as regards sales, exchanges or
other remunerative transfers, the proceeds of such sales or the properties taken in by virtue of such
exchanges, shall be considered as merely the products of “physical changes” of the properties of her
estate which the will expressly authorizes Hodges to make, provided that whatever of said products
should remain with the estate at the time of the death of Hodges should go to her brothers and sisters; (3)
the dispositions made by PCIB after the death of Hodges must naturally be deemed as covering only the
properties belonging to his estate considering that being only the administrator of the estate of Hodges,
PCIB could not have disposed of properties belonging to the estate of his wife. Neither could such
dispositions be considered as involving conjugal properties, for the simple reason that the conjugal
partnership automatically ceased when Mrs. Hodges died, and by the peculiar provision of her will, under
discussion, the remainder of her share descended also automatically upon the death of Hodges to her
brothers and sisters, thus outside of the scope of PCIB’s administration. Accordingly, these construction
of the will of Mrs. Hodges should be adhered to by the trial court in its final order of adjudication and
distribution and/or partition of the two estates in question.
THE APPEALS
A cursory examination of the seventy-eight assignments of error in appellant PCIB’s brief would readily
reveal that all of them are predicated mainly on the contention that inasmuch as Hodges had already
adjudicated unto himself all the properties constituting his wife’s share of the conjugal partnership,
allegedly with the sanction of the trial court per its order of December 14, 1957, there has been, since
said date, no longer any estate of Mrs. Hodges of which appellee Magno could be administratrix, hence
the various assailed orders sanctioning her actuations as such are not in accordance with law. Such
being the case, with the foregoing resolution holding such posture to be untenable in fact and in law and
that it is in the best interest of justice that for the time being the two estates should be administered
conjointly by the respective administrators of the two estates, it should follow that said assignments of
error have lost their fundamental reasons for being. There are certain matters, however, relating
peculiarly to the respective orders in question, if commonly among some of them, which need further
clarification. For instance, some of them authorized respondent Magno to act alone or without
concurrence of PCIB. And with respect to many of said orders, PCIB further claims that either the matters
involved were not properly within the probate jurisdiction of the trial court or that the procedure followed
was not in accordance with the rules. Hence, the necessity of dealing separately with the merits of each
of the appeals.

Indeed, inasmuch as the said two estates have until now remained commingled pro-indiviso, due to the
failure of Hodges and the lower court to liquidate the conjugal partnership, to recognize appellee Magno
as Administratrix of the Testate Estate of Mrs. Hodges which is still unsegregated from that of Hodges is
not to say, without any qualification, that she was therefore authorized to do and perform all her acts
complained of in these appeals, sanctioned though they might have been by the trial court. As a matter of
fact, it is such commingling pro-indiviso of the two estates that should deprive appellee of freedom to act
independently from PCIB, as administrator of the estate of Hodges, just as, for the same reason, the latter
should not have authority to act independently from her. And considering that the lower court failed to
adhere consistently to this basic point of view, by allowing the two administrators to act independently of
each other, in the various instances already noted in the narration of facts above, the Court has to look
into the attendant circumstances of each of the appealed orders to be able to determine whether any of
them has to be set aside or they may all be legally maintained notwithstanding the failure of the court a
quo to observe the pertinent procedural technicalities, to the end only that graver injury to the substantive
rights of the parties concerned and unnecessary and undesirable proliferation of incidents in the subject
proceedings may be forestalled. In other words, We have to determine, whether or not, in the light of the
unusual circumstances extant in the record, there is need to be more pragmatic and to adopt a rather
unorthodox approach, so as to cause the least disturbance in rights already being exercised by numerous
innocent third parties, even if to do so may not appear to be strictly in accordance with the letter of the
applicable purely adjective rules.
Incidentally, it may be mentioned, at this point, that it was principally on account of the confusion that
might result later from PCIB’s continuing to administer all the community properties, notwithstanding the
certainty of the existence of the separate estate of Mrs. Hodges, and to enable both estates to function in
the meantime with a relative degree of regularity, that the Court ordered in the resolution of September 8,
1972 the modification of the injunction issued pursuant to the resolutions of August 8, October 4 and
December 6, 1967, by virtue of which respondent Magno was completely barred from any participation in
the administration of the properties herein involved. In the September 8 resolution, We ordered that,
pending this decision, Special Proceedings 1307 and 1672 should proceed jointly and that the respective
administrators therein “act conjointly — none of them to act singly and independently of each other for
any purpose.” Upon mature deliberation, We felt that to allow PCIB to continue managing or administering
all the said properties to the exclusion of the administratrix of Mrs. Hodges’ estate might place the heirs of
Hodges at an unduly advantageous position which could result in considerable, if not irreparable, damage
or injury to the other parties concerned. It is indeed to be regretted that apparently, up to this date, more
than a year after said resolution, the same has not been given due regard, as may be gleaned from the
fact that recently, respondent Magno has filed in these proceedings a motion to declare PCIB in contempt
for alleged failure to abide therewith, notwithstanding that its repeated motions for reconsideration thereof
have all been denied soon after they were filed. 9
Going back to the appeals, it is perhaps best to begin first with what appears to Our mind to be the
simplest, and then proceed to the more complicated ones in that order, without regard to the numerical
sequence of the assignments of error in appellant’s brief or to the order of the discussion thereof by
counsel.

Assignments of error numbers

LXXII, LXXVII and LXXVIII.
These assignments of error relate to (1) the order of the trial court of August 6, 1965 providing that “the
deeds of sale (therein referred to involving properties in the name of Hodges) should be signed jointly by
the PCIB, as Administrator of Testate Estate of C.N. Hodges, and Avelina A. Magno, as Administratrix of
the Testate Estate of Linnie Jane Hodges, and to this effect, the PCIB should take the necessary steps so
that Administratrix Avelina A. Magno could sign the deeds of sale,” (p. 248, Green Rec. on Appeal) (2) the
order of October 27, 1965 denying the motion for reconsideration of the foregoing order, (pp. 276-277, id.)
(3) the other order also dated October 27, 1965 enjoining inter alia, that “(a) all cash collections should be
deposited in the joint account of the estate of Linnie Jane Hodges and estate of C. N. Hodges, (b) that
whatever cash collections (that) had been deposited in the account of either of the estates should be
withdrawn and since then (sic) deposited in the joint account of the estate of Linnie Jane Hodges and the
estate of C. N. Hodges; … (d) (that) Administratrix Magno — allow the PCIB to inspect whatever records,
documents and papers she may have in her possession, in the same manner that Administrator PCIB is
also directed to allow Administratrix Magno to inspect whatever records, documents and papers it may
have in its possession” and “(e) that the accountant of the estate of Linnie Jane Hodges shall have
access to all records of the transactions of both estates for the protection of the estate of Linnie Jane
Hodges; and in like manner, the accountant or any authorized representative of the estate of C. N.
Hodges shall have access to the records of transactions of the Linnie Jane Hodges estate for the
protection of the estate of C. N. Hodges”, (pp. 292-295, id.) and (4) the order of February 15, 1966,
denying, among others, the motion for reconsideration of the order of October 27, 1965 last referred to.
(pp. 455-456, id.)
As may be readily seen, the thrust of all these four impugned orders is in line with the Court’s above-
mentioned resolution of September 8, 1972 modifying the injunction previously issued on August 8, 1967,
and, more importantly, with what We have said the trial court should have always done pending the
liquidation of the conjugal partnership of the Hodges spouses. In fact, as already stated, that is the
arrangement We are ordering, by this decision, to be followed. Stated differently, since the questioned
orders provide for joint action by the two administrators, and that is precisely what We are holding out to
have been done and should be done until the two estates are separated from each other, the said orders
must be affirmed. Accordingly the foregoing assignments of error must be, as they are hereby overruled.

Assignments of error Numbers LXVIII

to LXXI and LXXIII to LXXVI.
The orders complained of under these assignments of error commonly deal with expenditures made by
appellee Magno, as Administratrix of the Estate of Mrs. Hodges, in connection with her administration
thereof, albeit additionally, assignments of error Numbers LXIX to LXXI put into question the payment of
attorneys fees provided for in the contract for the purpose, as constituting, in effect, premature advances
to the heirs of Mrs. Hodges.

More specifically, assignment Number LXXIII refers to reimbursement of overtime pay paid to six
employees of the court and three other persons for services in copying the court records to enable the
lawyers of the administration to be fully informed of all the incidents in the proceedings. The
reimbursement was approved as proper legal expenses of administration per the order of December 19,
1964, (pp. 221-222, id.) and repeated motions for reconsideration thereof were denied by the orders of
January 9, 1965, (pp. 231-232, id.) October 27, 1965, (p. 277, id.) and February 15, 1966. (pp. 455-
456, id.) On the other hand, Assignments Numbers LXVIII to LXXI, LXXIV and LXXV question the trial
court’s order of November 3, 1965 approving the agreement of June 6, 1964 between Administratrix
Magno and James L. Sullivan, attorney-in-fact of the heirs of Mrs. Hodges, as Parties of the First Part,
and Attorneys Raul Manglapus and Rizal R. Quimpo, as Parties of the Second Part, regarding attorneys
fees for said counsel who had agreed “to prosecute and defend their interests (of the Parties of the First
Part) in certain cases now pending litigation in the Court of First Instance of Iloilo —, more specifically in
Special Proceedings 1307 and 1672 —” (pp. 126-129, id.) and directing Administratrix Magno “to issue
and sign whatever check or checks maybe needed to implement the approval of the agreement annexed
to the motion” as well as the “administrator of the estate of C. N. Hodges — to countersign the said check
or checks as the case maybe.” (pp. 313-320, id.), reconsideration of which order of approval was denied
in the order of February 16, 1966, (p. 456, id.) Assignment Number LXXVI imputes error to the lower
court’s order of October 27, 1965, already referred to above, insofar as it orders that “PCIB should
counter sign the check in the amount of P250 in favor of Administratrix Avelina A. Magno as her
compensation as administratrix of Linnie Jane Hodges estate chargeable to the Testate Estate of Linnie
Jane Hodges only.” (p. 294, id.)
Main contention again of appellant PCIB in regard to these eight assigned errors is that there is no such
estate as the estate of Mrs. Hodges for which the questioned expenditures were made, hence what were
authorized were in effect expenditures from the estate of Hodges. As We have already demonstrated in
Our resolution above of the petition for certiorari and prohibition, this posture is incorrect. Indeed, in
whichever way the remaining issues between the parties in these cases are ultimately resolved, 10the final
result will surely be that there are properties constituting the estate of Mrs. Hodges of which Magno is the
current administratrix. It follows, therefore, that said appellee had the right, as such administratrix, to hire
the persons whom she paid overtime pay and to be paid for her own services as administratrix. That she
has not yet collected and is not collecting amounts as substantial as that paid to or due appellant PCIB is
to her credit.
Of course, she is also entitled to the services of counsel and to that end had the authority to enter into
contracts for attorney’s fees in the manner she had done in the agreement of June 6, 1964. And as
regards to the reasonableness of the amount therein stipulated, We see no reason to disturb the
discretion exercised by the probate court in determining the same. We have gone over the agreement,
and considering the obvious size of the estate in question and the nature of the issues between the
parties as well as the professional standing of counsel, We cannot say that the fees agreed upon require
the exercise by the Court of its inherent power to reduce it.

PCIB insists, however, that said agreement of June 6, 1964 is not for legal services to the estate but to
the heirs of Mrs. Hodges, or, at most, to both of them, and such being the case, any payment under it,
insofar as counsels’ services would redound to the benefit of the heirs, would be in the nature of
advances to such heirs and a premature distribution of the estate. Again, We hold that such posture
cannot prevail.

Upon the premise We have found plausible that there is an existing estate of Mrs. Hodges, it results that
juridically and factually the interests involved in her estate are distinct and different from those involved in
her estate of Hodges and vice versa. Insofar as the matters related exclusively to the estate of Mrs.
Hodges, PCIB, as administrator of the estate of Hodges, is a complete stranger and it is without
personality to question the actuations of the administratrix thereof regarding matters not affecting the
estate of Hodges. Actually, considering the obviously considerable size of the estate of Mrs. Hodges, We
see no possible cause for apprehension that when the two estates are segregated from each other, the
amount of attorney’s fees stipulated in the agreement in question will prejudice any portion that would
correspond to Hodges’ estate.

And as regards the other heirs of Mrs. Hodges who ought to be the ones who should have a say on the
attorney’s fees and other expenses of administration assailed by PCIB, suffice it to say that they appear
to have been duly represented in the agreement itself by their attorney-in-fact, James L. Sullivan and
have not otherwise interposed any objection to any of the expenses incurred by Magno questioned by
PCIB in these appeals. As a matter of fact, as ordered by the trial court, all the expenses in question,
including the attorney’s fees, may be paid without awaiting the determination and segregation of the
estate of Mrs. Hodges.

Withal, the weightiest consideration in connection with the point under discussion is that at this stage of
the controversy among the parties herein, the vital issue refers to the existence or non-existence of the
estate of Mrs. Hodges. In this respect, the interest of respondent Magno, as the appointed administratrix
of the said estate, is to maintain that it exists, which is naturally common and identical with and
inseparable from the interest of the brothers and sisters of Mrs. Hodges. Thus, it should not be wondered
why both Magno and these heirs have seemingly agreed to retain but one counsel. In fact, such an
arrangement should be more convenient and economical to both. The possibility of conflict of interest
between Magno and the heirs of Mrs. Hodges would be, at this stage, quite remote and, in any event,
rather insubstantial. Besides, should any substantial conflict of interest between them arise in the future,
the same would be a matter that the probate court can very well take care of in the course of the
independent proceedings in Case No. 1307 after the corresponding segregation of the two subject
estates. We cannot perceive any cogent reason why, at this stage, the estate and the heirs of Mrs.
Hodges cannot be represented by a common counsel.

Now, as to whether or not the portion of the fees in question that should correspond to the heirs
constitutes premature partial distribution of the estate of Mrs. Hodges is also a matter in which neither
PCIB nor the heirs of Hodges have any interest. In any event, since, as far as the records show, the
estate has no creditors and the corresponding estate and inheritance taxes, except those of the brothers
and sisters of Mrs. Hodges, have already been paid, 11no prejudice can caused to anyone by the
comparatively small amount of attorney’s fees in question. And in this connection, it may be added that,
although strictly speaking, the attorney’s fees of the counsel of an administrator is in the first instance his
personal responsibility, reimbursable later on by the estate, in the final analysis, when, as in the situation
on hand, the attorney-in-fact of the heirs has given his conformity thereto, it would be idle effort to inquire
whether or not the sanction given to said fees by the probate court is proper.
For the foregoing reasons, Assignments of Error LXVIII to LXXI and LXXIII to LXXVI should be as they
are hereby overruled.

Assignments of error I to IV,

XIII to XV, XXII to XXV, XXXV
to XXX VI, XLI to XLIII and L.
These assignments of error deal with the approval by the trial court of various deeds of sale of real
properties registered in the name of Hodges but executed by appellee Magno, as Administratrix of the
Estate of Mrs. Hodges, purportedly in implementation of corresponding supposed written “Contracts to
Sell” previously executed by Hodges during the interim between May 23, 1957, when his wife died, and
December 25, 1962, the day he died. As stated on pp. 118-120 of appellant’s main brief, “These are: the,
contract to sell between the deceased, Charles Newton Hodges, and the appellee, Pepito G. Iyulores
executed on February 5, 1961; the contract to sell between the deceased, Charles Newton Hodges, and
the appellant Esperidion Partisala, executed on April 20, 1960; the contract to sell between the deceased,
Charles Newton Hodges, and the appellee, Winifredo C. Espada, executed on April 18, 1960; the contract
to sell between the deceased, Charles Newton Hodges, and the appellee, Rosario Alingasa, executed on
August 25, 1958; the contract to sell between the deceased, Charles Newton Hodges, and the appellee,
Lorenzo Carles, executed on June 17, 1958; the contract to sell between the deceased, Charles Newton
Hodges, and the appellee, Salvador S. Guzman, executed on September 13, 1960; the contract to sell
between the deceased, Charles Newton Hodges, and the appellee, Florenia Barrido, executed on
February 21, 1958; the contract to sell between the deceased, Charles Newton Hodges, and the appellee,
Purificacion Coronado, executed on August 14, 1961; the contract to sell between the deceased, Charles
Newton Hodges, and the appellee, Graciano Lucero, executed on November 27, 1961; the contract to sell
between the deceased, Charles Newton Hodges, and the appellee, Ariteo Thomas Jamir, executed on
May 26, 1961; the contract to sell between the deceased, Charles Newton Hodges, and the appellee,
Melquiades Batisanan, executed on June 9, 1959; the contract to sell between the deceased, Charles
Newton Hodges, and the appellee, Belcezar Causing, executed on February 10, 1959 and the contract to
sell between the deceased, Charles Newton Hodges, and the appellee, Adelfa Premaylon, executed on
October 31, 1959, re Title No. 13815.”

Relative to these sales, it is the position of appellant PCIB that, inasmuch as pursuant to the will of Mrs.
Hodges, her husband was to have dominion over all her estate during his lifetime, it was as absolute
owner of the properties respectively covered by said sales that he executed the aforementioned contracts
to sell, and consequently, upon his death, the implementation of said contracts may be undertaken only
by the administrator of his estate and not by the administratrix of the estate of Mrs. Hodges. Basically, the
same theory is invoked with particular reference to five other sales, in which the respective “contracts to
sell” in favor of these appellees were executed by Hodges before the death of his wife, namely, those in
favor of appellee Santiago Pacaonsis, Alfredo Catedral, Jose Pablico, Western Institute of Technology
and Adelfa Premaylon.

Anent those deeds of sale based on promises or contracts to sell executed by Hodges after the death of
his wife, those enumerated in the quotation in the immediately preceding paragraph, it is quite obvious
that PCIB’s contention cannot be sustained. As already explained earlier, 1 1* all proceeds of remunerative
transfers or dispositions made by Hodges after the death of his wife should be deemed as continuing to
be parts of her estate and, therefore, subject to the terms of her will in favor of her brothers and sisters, in
the sense that should there be no showing that such proceeds, whether in cash or property have been
subsequently conveyed or assigned subsequently by Hodges to any third party by acts inter vivos with the
result that they could not thereby belong to him anymore at the time of his death, they automatically
became part of the inheritance of said brothers and sisters. The deeds here in question involve
transactions which are exactly of this nature. Consequently, the payments made by the appellees should
be considered as payments to the estate of Mrs. Hodges which is to be distributed and partitioned among
her heirs specified in the will.
The five deeds of sale predicated on contracts to sell executed Hodges during the lifetime of his wife,
present a different situation. At first blush, it would appear that as to them, PCIB’s position has some
degree of plausibility. Considering, however, that the adoption of PCIB’s theory would necessarily have
tremendous repercussions and would bring about considerable disturbance of property rights that have
somehow accrued already in favor of innocent third parties, the five purchasers aforenamed, the Court is
inclined to take a pragmatic and practical view of the legal situation involving them by overlooking the
possible technicalities in the way, the non-observance of which would not, after all, detract materially from
what should substantially correspond to each and all of the parties concerned.

To start with, these contracts can hardly be ignored. Bona fide third parties are involved; as much as
possible, they should not be made to suffer any prejudice on account of judicial controversies not of their
own making. What is more, the transactions they rely on were submitted by them to the probate court for
approval, and from already known and recorded actuations of said court then, they had reason to believe
that it had authority to act on their motions, since appellee Magno had, from time to time prior to their
transactions with her, been allowed to act in her capacity as administratrix of one of the subject estates
either alone or conjointly with PCIB. All the sales in question were executed by Magno in 1966 already,
but before that, the court had previously authorized or otherwise sanctioned expressly many of her act as
administratrix involving expenditures from the estate made by her either conjointly with or independently
from PCIB, as Administrator of the Estate of Hodges. Thus, it may be said that said buyers-appellees
merely followed precedents in previous orders of the court. Accordingly, unless the impugned orders
approving those sales indubitably suffer from some clearly fatal infirmity the Court would rather affirm
them.
It is quite apparent from the record that the properties covered by said sales are equivalent only to a
fraction of what should constitute the estate of Mrs. Hodges, even if it is assumed that the same would
finally be held to be only one-fourth of the conjugal properties of the spouses as of the time of her death
or, to be more exact, one-half of her estate as per the inventory submitted by Hodges as executor, on
May 12, 1958. In none of its numerous, varied and voluminous pleadings, motions and manifestations has
PCIB claimed any possibility otherwise. Such being the case, to avoid any conflict with the heirs of
Hodges, the said properties covered by the questioned deeds of sale executed by appellee Magno may
be treated as among those corresponding to the estate of Mrs. Hodges, which would have been actually
under her control and administration had Hodges complied with his duty to liquidate the conjugal
partnership. Viewing the situation in that manner, the only ones who could stand to be prejudiced by the
appealed orders referred to in the assignment of errors under discussion and who could, therefore, have
the requisite interest to question them would be only the heirs of Mrs. Hodges, definitely not PCIB.

It is of no moment in what capacity Hodges made the “contracts to sell’ after the death of his wife. Even if
he had acted as executor of the will of his wife, he did not have to submit those contracts to the court nor
follow the provisions of the rules, (Sections 2, 4, 5, 6, 8 and 9 of Rule 89 quoted by appellant on pp. 125
to 127 of its brief) for the simple reason that by the very orders, much relied upon by appellant for other
purposes, of May 27, 1957 and December 14, 1957, Hodges was “allowed or authorized” by the trial court
“to continue the business in which he was engaged and to perform acts which he had been doing while
the deceased was living”, (Order of May 27) which according to the motion on which the court acted was
“of buying and selling personal and real properties”, and “to execute subsequent sales, conveyances,
leases and mortgages of the properties left by the said deceased Linnie Jane Hodges in consonance with
the wishes conveyed in the last will and testament of the latter.” (Order of December 14) In other words, if
Hodges acted then as executor, it can be said that he had authority to do so by virtue of these blanket
orders, and PCIB does not question the legality of such grant of authority; on the contrary, it is relying on
the terms of the order itself for its main contention in these cases. On the other hand, if, as PCIB
contends, he acted as heir-adjudicatee, the authority given to him by the aforementioned orders would
still suffice.

As can be seen, therefore, it is of no moment whether the “contracts to sell” upon which the deeds in
question were based were executed by Hodges before or after the death of his wife. In a word, We hold,
for the reasons already stated, that the properties covered by the deeds being assailed pertain or should
be deemed as pertaining to the estate of Mrs. Hodges; hence, any supposed irregularity attending the
actuations of the trial court may be invoked only by her heirs, not by PCIB, and since the said heirs are
not objecting, and the defects pointed out not being strictly jurisdictional in nature, all things considered,
particularly the unnecessary disturbance of rights already created in favor of innocent third parties, it is
best that the impugned orders are not disturbed.

In view of these considerations, We do not find sufficient merit in the assignments of error under
discussion.

Assignments of error V to VIII,

XVI to XVIII, XXVI to XXIX, XXXVII
to XXXVIII, XLIV to XLVI and LI.
All these assignments of error commonly deal with alleged non-fulfillment by the respective vendees,
appellees herein, of the terms and conditions embodied in the deeds of sale referred to in the
assignments of error just discussed. It is claimed that some of them never made full payments in
accordance with the respective contracts to sell, while in the cases of the others, like Lorenzo Carles,
Jose Pablico, Alfredo Catedral and Salvador S. Guzman, the contracts with them had already been
unilaterally cancelled by PCIB pursuant to automatic rescission clauses contained in them, in view of the
failure of said buyers to pay arrearages long overdue. But PCIB’s posture is again premised on its
assumption that the properties covered by the deeds in question could not pertain to the estate of Mrs.
Hodges. We have already held above that, it being evident that a considerable portion of the conjugal
properties, much more than the properties covered by said deeds, would inevitably constitute the estate
of Mrs. Hodges, to avoid unnecessary legal complications, it can be assumed that said properties form
part of such estate. From this point of view, it is apparent again that the questions, whether or not it was
proper for appellee Magno to have disregarded the cancellations made by PCIB, thereby reviving the
rights of the respective buyers-appellees, and, whether or not the rules governing new dispositions of
properties of the estate were strictly followed, may not be raised by PCIB but only by the heirs of Mrs.
Hodges as the persons designated to inherit the same, or perhaps the government because of the still
unpaid inheritance taxes. But, again, since there is no pretense that any objections were raised by said
parties or that they would necessarily be prejudiced, the contentions of PCIB under the instant
assignments of error hardly merit any consideration.

Assignments of error IX to XII, XIX

to XXI, XXX to XXIV, XXXIX to XL,
XLVII to XLIX, LII and LIII to LXI.
PCIB raises under these assignments of error two issues which according to it are fundamental, namely:
(1) that in approving the deeds executed by Magno pursuant to contracts to sell already cancelled by it in
the performance of its functions as administrator of the estate of Hodges, the trial court deprived the said
estate of the right to invoke such cancellations it (PCIB) had made and (2) that in so acting, the court
“arrogated unto itself, while acting as a probate court, the power to determine the contending claims of
third parties against the estate of Hodges over real property,” since it has in effect determined whether or
not all the terms and conditions of the respective contracts to sell executed by Hodges in favor of the
buyers-appellees concerned were complied with by the latter. What is worse, in the view of PCIB, is that
the court has taken the word of the appellee Magno, “a total stranger to his estate as determinative of the
issue”.

Actually, contrary to the stand of PCIB, it is this last point regarding appellee Magno’s having agreed to
ignore the cancellations made by PCIB and allowed the buyers-appellees to consummate the sales in
their favor that is decisive. Since We have already held that the properties covered by the contracts in
question should be deemed to be portions of the estate of Mrs. Hodges and not that of Hodges, it is PCIB
that is a complete stranger in these incidents. Considering, therefore, that the estate of Mrs. Hodges and
her heirs who are the real parties in interest having the right to oppose the consummation of the
impugned sales are not objecting, and that they are the ones who are precisely urging that said sales be
sanctioned, the assignments of error under discussion have no basis and must accordingly be as they are
hereby overruled.

With particular reference to assignments LIII to LXI, assailing the orders of the trial court requiring PCIB to
surrender the respective owner’s duplicate certificates of title over the properties covered by the sales in
question and otherwise directing the Register of Deeds of Iloilo to cancel said certificates and to issue
new transfer certificates of title in favor of the buyers-appellees, suffice it to say that in the light of the
above discussion, the trial court was within its rights to so require and direct, PCIB having refused to give
way, by withholding said owners’ duplicate certificates, of the corresponding registration of the transfers
duly and legally approved by the court.

Assignments of error LXII to LXVII

All these assignments of error commonly deal with the appeal against orders favoring appellee Western
Institute of Technology. As will be recalled, said institute is one of the buyers of real property covered by a
contract to sell executed by Hodges prior to the death of his wife. As of October, 1965, it was in arrears in
the total amount of P92,691.00 in the payment of its installments on account of its purchase, hence it
received under date of October 4, 1965 and October 20, 1965, letters of collection, separately and
respectively, from PCIB and appellee Magno, in their respective capacities as administrators of the
distinct estates of the Hodges spouses, albeit, while in the case of PCIB it made known that “no other
arrangement can be accepted except by paying all your past due account”, on the other hand, Magno
merely said she would “appreciate very much if you can make some remittance to bring this account up-
to-date and to reduce the amount of the obligation.” (See pp. 295-311, Green R. on A.) On November 3,
1965, the Institute filed a motion which, after alleging that it was ready and willing to pay P20,000 on
account of its overdue installments but uncertain whether it should pay PCIB or Magno, it prayed that it be
“allowed to deposit the aforesaid amount with the court pending resolution of the conflicting claims of the
administrators.” Acting on this motion, on November 23, 1965, the trial court issued an order, already
quoted in the narration of facts in this opinion, holding that payment to both or either of the two
administrators is “proper and legal”, and so “movant — can pay to both estates or either of them”,
considering that “in both cases (Special Proceedings 1307 and 1672) there is as yet no judicial
declaration of heirs nor distribution of properties to whomsoever are entitled thereto.”

The arguments under the instant assignments of error revolve around said order. From the procedural
standpoint, it is claimed that PCIB was not served with a copy of the Institute’s motion, that said motion
was heard, considered and resolved on November 23, 1965, whereas the date set for its hearing was
November 20, 1965, and that what the order grants is different from what is prayed for in the motion. As
to the substantive aspect, it is contended that the matter treated in the motion is beyond the jurisdiction of
the probate court and that the order authorized payment to a person other than the administrator of the
estate of Hodges with whom the Institute had contracted.

The procedural points urged by appellant deserve scant consideration. We must assume, absent any
clear proof to the contrary, that the lower court had acted regularly by seeing to it that appellant was duly
notified. On the other hand, there is nothing irregular in the court’s having resolved the motion three days
after the date set for hearing the same. Moreover, the record reveals that appellants’ motion for
reconsideration wherein it raised the same points was denied by the trial court on March 7, 1966 (p. 462,
Green R. on A.) Withal, We are not convinced that the relief granted is not within the general intent of the
Institute’s motion.

Insofar as the substantive issues are concerned, all that need be said at this point is that they are mere
reiterations of contentions We have already resolved above adversely to appellants’ position. Incidentally,
We may add, perhaps, to erase all doubts as to the propriety of not disturbing the lower court’s orders
sanctioning the sales questioned in all these appeal s by PCIB, that it is only when one of the parties to a
contract to convey property executed by a deceased person raises substantial objections to its being
implemented by the executor or administrator of the decedent’s estate that Section 8 of Rule 89 may not
apply and, consequently, the matter has, to be taken up in a separate action outside of the probate court;
but where, as in the cases of the sales herein involved, the interested parties are in agreement that the
conveyance be made, it is properly within the jurisdiction of the probate court to give its sanction thereto
pursuant to the provisions of the rule just mentioned. And with respect to the supposed automatic
rescission clauses contained in the contracts to sell executed by Hodges in favor of herein appellees, the
effect of said clauses depend on the true nature of the said contracts, despite the nomenclature
appearing therein, which is not controlling, for if they amount to actual contracts of sale instead of being
mere unilateral accepted “promises to sell”, (Art. 1479, Civil Code of the Philippines, 2nd paragraph)
the pactum commissorium or the automatic rescission provision would not operate, as a matter of public
policy, unless there has been a previous notarial or judicial demand by the seller (10 Manresa 263, 2nd
ed.) neither of which have been shown to have been made in connection with the transactions herein
involved.
Consequently, We find no merit in the assignments of error
Number LXII to LXVII.

SUMMARY
Considering the fact that this decision is unusually extensive and that the issues herein taken up and
resolved are rather numerous and varied, what with appellant making seventy-eight assignments of error
affecting no less than thirty separate orders of the court a quo, if only to facilitate proper understanding of
the import and extent of our rulings herein contained, it is perhaps desirable that a brief restatement of the
whole situation be made together with our conclusions in regard to its various factual and legal aspects. .

The instant cases refer to the estate left by the late Charles Newton Hodges as well as that of his wife,
Linnie Jane Hodges, who predeceased him by about five years and a half. In their respective wills which
were executed on different occasions, each one of them provided mutually as follows: “I give, devise and
bequeath all of the rest, residue and remainder (after funeral and administration expenses, taxes and
debts) of my estate, both real and personal, wherever situated or located, to my beloved (spouse) to have
and to hold unto (him/her) — during (his/her) natural lifetime”, subject to the condition that upon the death
of whoever of them survived the other, the remainder of what he or she would inherit from the other is
“give(n), devise(d) and bequeath(ed)” to the brothers and sisters of the latter.

Mrs. Hodges died first, on May 23, 1957. Four days later, on May 27, Hodges was appointed special
administrator of her estate, and in a separate order of the same date, he was “allowed or authorized to
continue the business in which he was engaged, (buying and selling personal and real properties) and to
perform acts which he had been doing while the deceased was living.” Subsequently, on December 14,
1957, after Mrs. Hodges’ will had been probated and Hodges had been appointed and had qualified as
Executor thereof, upon his motion in which he asserted that he was “not only part owner of the properties
left as conjugal, but also, the successor to all the properties left by the deceased Linnie Jane Hodges”,
the trial court ordered that “for the reasons stated in his motion dated December 11, 1957, which the
Court considers well taken, … all the sales, conveyances, leases and mortgages of all properties left by
the deceased Linnie Jane Hodges executed by the Executor, Charles Newton Hodges are hereby
APPROVED. The said Executor is further authorized to execute subsequent sales, conveyances, leases
and mortgages of the properties left by the said deceased Linnie Jane Hodges in consonance with the
wishes contained in the last will and testament of the latter.”
Annually thereafter, Hodges submitted to the court the corresponding statements of account of his
administration, with the particularity that in all his motions, he always made it point to urge the that “no
person interested in the Philippines of the time and place of examining the herein accounts be given
notice as herein executor is the only devisee or legatee of the deceased in accordance with the last will
and testament already probated by the Honorable Court.” All said accounts approved as prayed for.

Nothing else appears to have been done either by the court a quo or Hodges until December 25, 1962.
Importantly to be the provision in the will of Mrs. Hodges that her share of the conjugal partnership was to
be inherited by her husband “to have and to hold unto him, my said husband, during his natural lifetime”
and that “at the death of my said husband, I give, devise and bequeath all the rest, residue and remainder
of my estate, both real and personal, wherever situated or located, to be equally divided among my
brothers and sisters, share and share alike”, which provision naturally made it imperative that the conjugal
partnership be promptly liquidated, in order that the “rest, residue and remainder” of his wife’s share
thereof, as of the time of Hodges’ own death, may be readily known and identified, no such liquidation
was ever undertaken. The record gives no indication of the reason for such omission, although relatedly,
it appears therein:
1. That in his annual statement submitted to the court of the net worth of C. N. Hodges and the Estate of
Linnie Jane Hodges, Hodges repeatedly and consistently reported the combined income of the conjugal
partnership and then merely divided the same equally between himself and the estate of the deceased
wife, and, more importantly, he also, as consistently, filed corresponding separate income tax returns for
each calendar year for each resulting half of such combined income, thus reporting that the estate of Mrs.
Hodges had its own income distinct from his own.

2. That when the court a quo happened to inadvertently omit in its order probating the will of Mrs. Hodges,
the name of one of her brothers, Roy Higdon then already deceased, Hodges lost no time in asking for
the proper correction “in order that the heirs of deceased Roy Higdon may not think or believe they were
omitted, and that they were really interested in the estate of the deceased Linnie Jane Hodges”.
3. That in his aforementioned motion of December 11, 1957, he expressly stated that “deceased Linnie
Jane Hodges died leaving no descendants or ascendants except brothers and sisters and herein
petitioner as the surviving spouse, to inherit the properties of the decedent”, thereby indicating that he
was not excluding his wife’s brothers and sisters from the inheritance.

4. That Hodges allegedly made statements and manifestations to the United States inheritance tax
authorities indicating that he had renounced his inheritance from his wife in favor of her other heirs, which
attitude he is supposed to have reiterated or ratified in an alleged affidavit subscribed and sworn to here
in the Philippines and in which he even purportedly stated that his reason for so disclaiming and
renouncing his rights under his wife’s will was to “absolve (him) or (his) estate from any liability for the
payment of income taxes on income which has accrued to the estate of Linnie Jane Hodges”, his wife,
since her death.
On said date, December 25, 1962, Hodges died. The very next day, upon motion of herein respondent
and appellee, Avelina A. Magno, she was appointed by the trial court as Administratrix of the Testate
Estate of Linnie Jane Hodges, in Special Proceedings No. 1307 and as Special Administratrix of the
estate of Charles Newton Hodges, “in the latter case, because the last will of said Charles Newton
Hodges is still kept in his vault or iron safe and that the real and personal properties of both spouses may
be lost, damaged or go to waste, unless Special Administratrix is appointed,” (Order of December 26,
1962, p. 27, Yellow R. on A.) although, soon enough, on December 29, 1962, a certain Harold K. Davies
was appointed as her Co-Special Administrator, and when Special Proceedings No. 1672, Testate Estate
of Charles Newton Hodges, was opened, Joe Hodges, as next of kin of the deceased, was in due time
appointed as Co-Administrator of said estate together with Atty. Fernando P. Mirasol, to replace Magno
and Davies, only to be in turn replaced eventually by petitioner PCIB alone.

At the outset, the two probate proceedings appear to have been proceeding jointly, with each
administrator acting together with the other, under a sort of modus operandi. PCIB used to secure at the
beginning the conformity to and signature of Magno in transactions it wanted to enter into and submitted
the same to the court for approval as their joint acts. So did Magno do likewise. Somehow, however,
differences seem to have arisen, for which reason, each of them began acting later on separately and
independently of each other, with apparent sanction of the trial court. Thus, PCIB had its own lawyers
whom it contracted and paid handsomely, conducted the business of the estate independently of Magno
and otherwise acted as if all the properties appearing in the name of Charles Newton Hodges belonged
solely and only to his estate, to the exclusion of the brothers and sisters of Mrs. Hodges, without
considering whether or not in fact any of said properties corresponded to the portion of the conjugal
partnership pertaining to the estate of Mrs. Hodges. On the other hand, Magno made her own
expenditures, hired her own lawyers, on the premise that there is such an estate of Mrs. Hodges, and
dealth with some of the properties, appearing in the name of Hodges, on the assumption that they
actually correspond to the estate of Mrs. Hodges. All of these independent and separate actuations of the
two administrators were invariably approved by the trial court upon submission. Eventually, the
differences reached a point wherein Magno, who was more cognizant than anyone else about the ins and
outs of the businesses and properties of the deceased spouses because of her long and intimate
association with them, made it difficult for PCIB to perform normally its functions as administrator
separately from her. Thus, legal complications arose and the present judicial controversies came about.

Predicating its position on the tenor of the orders of May 27 and December 14, 1957 as well as the
approval by the court a quo of the annual statements of account of Hodges, PCIB holds to the view that
the estate of Mrs. Hodges has already been in effect closed with the virtual adjudication in the mentioned
orders of her whole estate to Hodges, and that, therefore, Magno had already ceased since then to have
any estate to administer and the brothers and sisters of Mrs. Hodges have no interests whatsoever in the
estate left by Hodges. Mainly upon such theory, PCIB has come to this Court with a petition
for certiorari and prohibition praying that the lower court’s orders allowing respondent Magno to continue
acting as administratrix of the estate of Mrs. Hodges in Special Proceedings 1307 in the manner she has
been doing, as detailed earlier above, be set aside. Additionally, PCIB maintains that the provision in Mrs.
Hodges’ will instituting her brothers and sisters in the manner therein specified is in the nature of a
testamentary substitution, but inasmuch as the purported substitution is not, in its view, in accordance
with the pertinent provisions of the Civil Code, it is ineffective and may not be enforced. It is further
contended that, in any event, inasmuch as the Hodges spouses were both residents of the Philippines,
following the decision of this Court in Aznar vs. Garcia, or the case of Christensen, 7 SCRA 95, the estate
left by Mrs. Hodges could not be more than one-half of her share of the conjugal partnership,
notwithstanding the fact that she was citizen of Texas, U.S.A., in accordance with Article 16 in relation to
Articles 900 and 872 of the Civil Code. Initially, We issued a preliminary injunction against Magno and
allowed PCIB to act alone.
At the same time PCIB has appealed several separate orders of the trial court approving individual acts of
appellee Magno in her capacity as administratrix of the estate of Mrs. Hodges, such as, hiring of lawyers
for specified fees and incurring expenses of administration for different purposes and executing deeds of
sale in favor of her co-appellees covering properties which are still registered in the name of Hodges,
purportedly pursuant to corresponding “contracts to sell” executed by Hodges. The said orders are being
questioned on jurisdictional and procedural grounds directly or indirectly predicated on the principal theory
of appellant that all the properties of the two estates belong already to the estate of Hodges exclusively.

On the other hand, respondent-appellee Magno denies that the trial court’s orders of May 27 and
December 14, 1957 were meant to be finally adjudicatory of the hereditary rights of Hodges and contends
that they were no more than the court’s general sanction of past and future acts of Hodges as executor of
the will of his wife in due course of administration. As to the point regarding substitution, her position is
that what was given by Mrs. Hodges to her husband under the provision in question was a lifetime
usufruct of her share of the conjugal partnership, with the naked ownership passing directly to her
brothers and sisters. Anent the application of Article 16 of the Civil Code, she claims that the applicable
law to the will of Mrs. Hodges is that of Texas under which, she alleges, there is no system of legitime,
hence, the estate of Mrs. Hodges cannot be less than her share or one-half of the conjugal partnership
properties. She further maintains that, in any event, Hodges had as a matter of fact and of law renounced
his inheritance from his wife and, therefore, her whole estate passed directly to her brothers and sisters
effective at the latest upon the death of Hodges.

In this decision, for the reasons discussed above, and upon the issues just summarized, We overrule
PCIB’s contention that the orders of May 27, 1957 and December 14, 1957 amount to an adjudication to
Hodges of the estate of his wife, and We recognize the present existence of the estate of Mrs. Hodges, as
consisting of properties, which, while registered in that name of Hodges, do actually correspond to the
remainder of the share of Mrs. Hodges in the conjugal partnership, it appearing that pursuant to the
pertinent provisions of her will, any portion of said share still existing and undisposed of by her husband at
the time of his death should go to her brothers and sisters share and share alike. Factually, We find that
the proven circumstances relevant to the said orders do not warrant the conclusion that the court intended
to make thereby such alleged final adjudication. Legally, We hold that the tenor of said orders furnish no
basis for such a conclusion, and what is more, at the time said orders were issued, the proceedings had
not yet reached the point when a final distribution and adjudication could be made. Moreover, the
interested parties were not duly notified that such disposition of the estate would be done. At best,
therefore, said orders merely allowed Hodges to dispose of portions of his inheritance in advance of final
adjudication, which is implicitly permitted under Section 2 of Rule 109, there being no possible prejudice
to third parties, inasmuch as Mrs. Hodges had no creditors and all pertinent taxes have been paid.

More specifically, We hold that, on the basis of circumstances presently extant in the record, and on the
assumption that Hodges’ purported renunciation should not be upheld, the estate of Mrs. Hodges
inherited by her brothers and sisters consists of one-fourth of the community estate of the spouses at the
time of her death, minus whatever Hodges had gratuitously disposed of therefrom during the period from,
May 23, 1957, when she died, to December 25, 1962, when he died provided, that with regard to
remunerative dispositions made by him during the same period, the proceeds thereof, whether in cash or
property, should be deemed as continuing to be part of his wife’s estate, unless it can be shown that he
had subsequently disposed of them gratuitously.
At this juncture, it may be reiterated that the question of what are the pertinent laws of Texas and what
would be the estate of Mrs. Hodges under them is basically one of fact, and considering the respective
positions of the parties in regard to said factual issue, it can already be deemed as settled for the
purposes of these cases that, indeed, the free portion of said estate that could possibly descend to her
brothers and sisters by virtue of her will may not be less than one-fourth of the conjugal estate, it
appearing that the difference in the stands of the parties has reference solely to the legitime of Hodges,
PCIB being of the view that under the laws of Texas, there is such a legitime of one-fourth of said
conjugal estate and Magno contending, on the other hand, that there is none. In other words, hereafter,
whatever might ultimately appear, at the subsequent proceedings, to be actually the laws of Texas on the
matter would no longer be of any consequence, since PCIB would anyway be in estoppel already to claim
that the estate of Mrs. Hodges should be less than as contended by it now, for admissions by a party
related to the effects of foreign laws, which have to be proven in our courts like any other controverted
fact, create estoppel.

In the process, We overrule PCIB’s contention that the provision in Mrs. Hodges’ will in favor of her
brothers and sisters constitutes ineffective hereditary substitutions. But neither are We sustaining, on the
other hand, Magno’s pose that it gave Hodges only a lifetime usufruct. We hold that by said provision,
Mrs. Hodges simultaneously instituted her brothers and sisters as co-heirs with her husband, with the
condition, however, that the latter would have complete rights of dominion over the whole estate during
his lifetime and what would go to the former would be only the remainder thereof at the time of Hodges’
death. In other words, whereas they are not to inherit only in case of default of Hodges, on the other
hand, Hodges was not obliged to preserve anything for them. Clearly then, the essential elements of
testamentary substitution are absent; the provision in question is a simple case of conditional
simultaneous institution of heirs, whereby the institution of Hodges is subject to a partial resolutory
condition the operative contingency of which is coincidental with that of the suspensive condition of the
institution of his brothers and sisters-in-law, which manner of institution is not prohibited by law.
We also hold, however, that the estate of Mrs. Hodges inherited by her brothers and sisters could be
more than just stated, but this would depend on (1) whether upon the proper application of the principle
of renvoi in relation to Article 16 of the Civil Code and the pertinent laws of Texas, it will appear that
Hodges had no legitime as contended by Magno, and (2) whether or not it can be held that Hodges had
legally and effectively renounced his inheritance from his wife. Under the circumstances presently
obtaining and in the state of the record of these cases, as of now, the Court is not in a position to make a
final ruling, whether of fact or of law, on any of these two issues, and We, therefore, reserve said issues
for further proceedings and resolution in the first instance by the court a quo, as hereinabove indicated.
We reiterate, however, that pending such further proceedings, as matters stand at this stage, Our
considered opinion is that it is beyond cavil that since, under the terms of the will of Mrs. Hodges, her
husband could not have anyway legally adjudicated or caused to be adjudicated to himself her whole
share of their conjugal partnership, albeit he could have disposed any part thereof during his lifetime, the
resulting estate of Mrs. Hodges, of which Magno is the uncontested administratrix, cannot be less than
one-fourth of the conjugal partnership properties, as of the time of her death, minus what, as explained
earlier, have been gratuitously disposed of therefrom, by Hodges in favor of third persons since then, for
even if it were assumed that, as contended by PCIB, under Article 16 of the Civil Code and
applying renvoi the laws of the Philippines are the ones ultimately applicable, such one-fourth share
would be her free disposable portion, taking into account already the legitime of her husband under Article
900 of the Civil Code.
The foregoing considerations leave the Court with no alternative than to conclude that in predicating its
orders on the assumption, albeit unexpressed therein, that there is an estate of Mrs. Hodges to be
distributed among her brothers and sisters and that respondent Magno is the legal administratrix thereof,
the trial court acted correctly and within its jurisdiction. Accordingly, the petition for certiorari and
prohibition has to be denied. The Court feels however, that pending the liquidation of the conjugal
partnership and the determination of the specific properties constituting her estate, the two administrators
should act conjointly as ordered in the Court’s resolution of September 8, 1972 and as further clarified in
the dispositive portion of its decision.
Anent the appeals from the orders of the lower court sanctioning payment by appellee Magno, as
administratrix, of expenses of administration and attorney’s fees, it is obvious that, with Our holding that
there is such an estate of Mrs. Hodges, and for the reasons stated in the body of this opinion, the said
orders should be affirmed. This We do on the assumption We find justified by the evidence of record, and
seemingly agreed to by appellant PCIB, that the size and value of the properties that should correspond
to the estate of Mrs. Hodges far exceed the total of the attorney’s fees and administration expenses in
question.

With respect to the appeals from the orders approving transactions made by appellee Magno, as
administratrix, covering properties registered in the name of Hodges, the details of which are related
earlier above, a distinction must be made between those predicated on contracts to sell executed by
Hodges before the death of his wife, on the one hand, and those premised on contracts to sell entered
into by him after her death. As regards the latter, We hold that inasmuch as the payments made by
appellees constitute proceeds of sales of properties belonging to the estate of Mrs. Hodges, as may be
implied from the tenor of the motions of May 27 and December 14, 1957, said payments continue to
pertain to said estate, pursuant to her intent obviously reflected in the relevant provisions of her will, on
the assumption that the size and value of the properties to correspond to the estate of Mrs. Hodges would
exceed the total value of all the properties covered by the impugned deeds of sale, for which reason, said
properties may be deemed as pertaining to the estate of Mrs. Hodges. And there being no showing that
thus viewing the situation, there would be prejudice to anyone, including the government, the Court also
holds that, disregarding procedural technicalities in favor of a pragmatic and practical approach as
discussed above, the assailed orders should be affirmed. Being a stranger to the estate of Mrs. Hodges,
PCIB has no personality to raise the procedural and jurisdictional issues raised by it. And inasmuch as it
does not appear that any of the other heirs of Mrs. Hodges or the government has objected to any of the
orders under appeal, even as to these parties, there exists no reason for said orders to be set aside.

DISPOSITIVE PART
IN VIEW OF ALL THE FOREGOING PREMISES, judgment is hereby rendered DISMISSING the petition
in G. R. Nos. L-27860 and L-27896, and AFFIRMING, in G. R. Nos. L-27936-37 and the other thirty-one
numbers hereunder ordered to be added after payment of the corresponding docket fees, all the orders of
the trial court under appeal enumerated in detail on pages 35 to 37 and 80 to 82 of this decision; the
existence of the Testate Estate of Linnie Jane Hodges, with respondent-appellee Avelina A. Magno, as
administratrix thereof is recognized, and it is declared that, until final judgment is ultimately rendered
regarding (1) the manner of applying Article 16 of the Civil Code of the Philippines to the situation
obtaining in these cases and (2) the factual and legal issue of whether or not Charles Newton Hodges
had effectively and legally renounced his inheritance under the will of Linnie Jane Hodges, the said estate
consists of one-fourth of the community properties of the said spouses, as of the time of the death of the
wife on May 23, 1957, minus whatever the husband had already gratuitously disposed of in favor of third
persons from said date until his death, provided, first, that with respect to remunerative dispositions, the
proceeds thereof shall continue to be part of the wife’s estate, unless subsequently disposed of
gratuitously to third parties by the husband, and second, that should the purported renunciation be
declared legally effective, no deductions whatsoever are to be made from said estate; in consequence,
the preliminary injunction of August 8, 1967, as amended on October 4 and December 6, 1967, is lifted,
and the resolution of September 8, 1972, directing that petitioner-appellant PCIB, as Administrator of the
Testate Estate of Charles Newton Hodges, in Special Proceedings 1672, and respondent-appellee
Avelina A. Magno, as Administratrix of the Testate Estate of Linnie Jane Hodges, in Special Proceedings
1307, should act thenceforth always conjointly, never independently from each other, as such
administrators, is reiterated, and the same is made part of this judgment and shall continue in force,
pending the liquidation of the conjugal partnership of the deceased spouses and the determination and
segregation from each other of their respective estates, provided, that upon the finality of this judgment,
the trial court should immediately proceed to the partition of the presently combined estates of the
spouses, to the end that the one-half share thereof of Mrs. Hodges may be properly and clearly identified;
thereafter, the trial court should forthwith segregate the remainder of the one-fourth herein adjudged to be
her estate and cause the same to be turned over or delivered to respondent for her exclusive
administration in Special Proceedings 1307, while the other one-fourth shall remain under the joint
administration of said respondent and petitioner under a joint proceedings in Special Proceedings 1307
and 1672, whereas the half unquestionably pertaining to Hodges shall be administered by petitioner
exclusively in Special Proceedings 1672, without prejudice to the resolution by the trial court of the
pending motions for its removal as administrator 12; and this arrangement shall be maintained until the final
resolution of the two issues of renvoi and renunciation hereby reserved for further hearing and
determination, and the corresponding complete segregation and partition of the two estates in the
proportions that may result from the said resolution.
Generally and in all other respects, the parties and the court a quo are directed to adhere henceforth, in
all their actuations in Special Proceedings 1307 and 1672, to the views passed and ruled upon by the
Court in the foregoing opinion.
Appellant PCIB is ordered to pay, within five (5) days from notice hereof, thirty-one additional appeal
docket fees, but this decision shall nevertheless become final as to each of the parties herein after fifteen
(15) days from the respective notices to them hereof in accordance with the rules.

Costs against petitioner-appellant PCIB.

Zaldivar, Castro, Esguerra and Fernandez, JJ., concur.

Makasiar, Antonio, Muñoz Palma and Aquino, JJ., concur in the result.

READ CASE DIGEST HERE.

Separate Opinions
FERNANDO, J., concurring:
I concur on the basis of the procedural pronouncements in the opinion.

TEEHANKEE, J., concurring:

I concur in the result of dismissal of the petition for certiorari and prohibition in Cases L-27860 and L-
27896 and with the affirmance of the appealed orders of the probate court in Cases L-27936-37.
I also concur with the portion of the dispositive part of the judgment penned by Mr. Justice Barredo
decreeing the lifting of the Court’s writ of preliminary injunction of August 8, 1967 as amended on October
4, and December 6, 1967 1and ordering in lieu thereof that the Court’s resolution of September 8,
1972 2which directed that petitioner-appellant PCIB as administrator of C. N. (Charles Newton) Hodges’
estate (Sp. Proc. No. 1672 and respondent-appellee Avelina A. Magno as administratrix of Linnie Jane
Hodges’ estate (Sp. Proc. No. 1307) should act always conjointly never independently from each other,
as such administrators, is reiterated and shall continue in force and made part of the judgment.
It is manifest from the record that petitioner-appellant PCIB’s primal contention in the cases at bar
belatedly filed by it with this Court on August 1, 1967 (over ten (10) years after Linnie Jane Hodges’ death
on May 23, 1957 and (over five (5) years after her husband C.N. Hodges’ death on December 25,
1962 — during which time both estates have been pending settlement and distribution to the decedents’
respective rightful heirs all this time up to now) — that the probate court per its order of December 14,
1957 (supplementing an earlier order of May 25, 1957) 3in granting C. N. Hodges’ motion as Executor of
his wife Linnie’s estate to continue their “business of buying and selling personal and real properties” and
approving “all sales, conveyances, leases and mortgages” made and to be made by him as such executor
under his obligation to submit his yearly accounts in effect declared him as sole heir of his wife’s estate
and nothing remains to be done except to formally close her estate (Sp. Proc. No. 1307) as her estate
was thereby merged with his own so that nothing remains of it that may be adjudicated to her brothers
and sisters as her designated heirs after him, 4— is wholly untenable and deserves scant consideration.
Aside from having been put forth as an obvious afterthought much too late in the day, this contention of
PCIB that there no longer exists any separate estate of Linnie Jane Hodges after the probate court’s
order of December 14, 1957 goes against the very acts and judicial admissions of C.N. Hodges as her
executor whereby he consistently recognized the separate existence and identity of his wife’s estate apart
from his own separate estate and from his own share of their conjugal partnership and estate and “never
considered the whole estate as a single one belonging exclusively to himself” during the entire period that
he survived her for over five (5) years up to the time of his own death on December 25, 1962 5and against
the identical acts and judicial admissions of PCIB as administrator of C.N. Hodges’ estate until PCIB
sought in 1966 to take over both estates as pertaining to its sole administration.
PCIB is now barred and estopped from contradicting or taking a belated position contradictory to or
inconsistent with its previous admissions 6 (as well as those of C.N. Hodges himself in his lifetime and of
whose estate PCIB is merely an administrator) recognizing the existence and identity of Linnie Jane
Hodges’ separate estate and the legal rights and interests therein of her brothers and sisters as her
designated heirs in her will.
PCIB’s petition for certiorari and prohibition to declare all acts of the probate court in Linnie Jane Hodges’
estate subsequent to its order of December 14, 1957 as “null and void for having been issued without
jurisdiction” must therefore be dismissed with the rejection of its belated and untenable contention that
there is no longer any estate of Mrs. Hodges of which respondent Avelina Magno is the duly appointed
and acting administratrix.
PCIB’s appeal 7from the probate court’s various orders recognizing respondent Magno as administratrix of
Linnie’s estate (Sp. Proc No. 1307) and sanctioning her acts of administration of said estate and
approving the sales contracts executed by her with the various individual appellees, which involve
basically the same primal issue raised in the petition as to whether there still exists a separate estate of
Linnie of which respondent-appellee Magno may continue to be the administratrix, must necessarily fail —
a result of the Court’s main opinion at bar that there does exist such an estate and that the two estates
(husband’s and wife’s) must be administered cojointly by their respective administrators (PCIB and
Magno).
The dispositive portion of the main opinion
The main opinion disposes that:

IN VIEW OF ALL THE FOREGOING PREMISES, judgment is hereby rendered DISMISSING the petition
in G. R. Nos. L-27860 and L-27896, and AFFIRMING, in G. R. Nos. L-27936-37 and the other thirty-one
numbers hereunder ordered to be added after payment of the corresponding docket fees, all the orders of
the trial court under appeal enumerated in detail on pages 35 to 37 and 80 to 82 of this decision:
The existence of the Testate Estate of Linnie Jane Hodges, with respondent-appellee Avelina A. Magno,
as administratrix thereof is recognized, and
It is declared that, until final judgment is ultimately rendered regarding (1) the manner of applying Article
16 of the Civil Code of the Philippines to the situation obtaining in these cases and (2) the factual and
legal issues of whether or not Charles Newton Hodges has effectively and legally renounced his
inheritance under the will of Linnie Jane Hodges, the said estate consists of one-fourth of the community
properties of the said spouses, as of the time of the death of the wife on May 23, 1957, minus whatever
the husband had already gratuitously disposed of in favor of third persons from said date until his death,
provided, first, that with respect to remunerative dispositions, the proceeds thereof shall continue to
be part of the wife’s estate, unless subsequently disposed of gratuitously to third parties by the husband,
and second, that should the purported renunciation be declared legally effective, no
deduction whatsoever are to be made from said estate;
In consequence, the preliminary injunction of August 8, 1967, as amended on October 4 and December
6, 1967, is lifted and the resolution of September 8, 1972, directing that petitioner-appellant PCIB, as
Administrator of the Testate Estate of Charles Newton Hodges in Special Proceedings 1672, and
respondent-appellee Avelina A. Magno, as Administratrix of the Testate Estate of Linnie Jane Hodges in
Special Proceedings 1307, should act thenceforth always conjointly, never independently from each
other, as such administrators, is reiterated, and the same is made part of this judgment and shall continue
in force, pending the liquidation of the conjugal partnership of the deceased spouses and
the determination and segregation from each other of their respective estates; provided, that upon the
finality of this judgment, the trial court should immediately proceed to the partition of the presently
combined estates of the spouses, to the end that the one-half share thereof of Mrs. Hodges may be
properly and clearly identified;
Thereafter, the trial court should forthwith segregate the remainder of the one-fourth herein adjudged to
be her estate and cause the same to be turned over or delivered to respondent for her exclusive
administration in Special Proceedings 1307, while the other one-fourth shall remain under the joint
administrative of said respondent and petitioner under a joint proceedings in Special Proceedings 1307
and 1672, whereas the half unquestionably pertaining to Hodges shall be administered by petitioner
exclusively in Special Proceedings 1672, without prejudice to the resolution by the trial court of
the pending motions for its removal as administrator;
And this arrangement shall be maintained until the final resolution of the two issues
of renvoi and renunciation hereby reserved for further hearing and determination, and the
corresponding complete segregation and partition of the two estates in the proportions that may result
from the said resolution.
Generally and in all other respects, the parties and the court a quo are directed to adhere henceforth, in
all their actuations in Special Proceedings 1307 and 1672, to the views passed and ruled upon by the
Court in the foregoing opinion. 8
Minimum estimate of Mrs. Hodges’ estate:
One-fourth of conjugal properties.
The main opinion in declaring the existence of a separate estate of Linnie Jane Hodges which shall pass
to her brothers and sisters with right of representation (by their heirs) as her duly designated heirs
declares that her estate consists as a minimum (i.e. assuming (1) that under Article 16 of the Philippine
Civil Code C. N. Hodges as surviving husband was entitled to one-half of her estate as legitime and (2)
that he had not effectively and legally renounced his inheritance under her will) of “one-fourth of the
community properties of the said spouses, as of the time of the death of the wife on May 23,
1957, minus whatever the husband had already gratuitously disposed of in favor of third persons from
said date until his death,” with the proviso that proceeds of remunerative dispositions or sales for valuable
consideration made by C. N. Hodges after his wife Linnie’s death shall continue to be part of her
estate unless subsequently disposed of by him gratuitously to third parties subject to the condition,
however, that if he is held to have validly and effectively renounced his inheritance under his wife’s
will, no deductions of any dispositions made by Hodges even if gratuitously are to be made from his wife
Linnie’s estate which shall pass intact to her brothers and sisters as her designated heirs called in her will
to succeed to her estate upon the death of her husband C. N. Hodges.
Differences with the main opinion
I do not share the main opinion’s view that Linnie Jane Hodges instituted her husband as her heir under
her will “to have dominion over all her estate during his lifetime … as absolute owner of the properties
…” 9and that she bequeathed “the whole of her estate to be owned and enjoyed by him as universal and
sole heir with absolute dominion over them only during his lifetime, which means that while he could
completely and absolutely dispose of any portion thereof inter vivos to anyone other than himself, he was
not free to do so mortis causa, and all his rights to what might remain upon his death would cease entirely
upon the occurrence of that contingency, inasmuch as the right of his brothers and sisters-in-law to the
inheritance, although vested already upon the death of Mrs. Hodges, would automatically become
operative upon the occurrence of the death of Hodges in the event of actual existence of any remainder of
her estate then.” 10
As will be amplified hereinafter, I do not subscribe to such a view that Linnie Jane Hodges willed “full and
absolute ownership” and “absolute dominion” over her estate to her husband, but rather that she named
her husband C. N. Hodges and her brothers and sisters as instituted heirs with a term under Article 885 of
our Civil Code, to wit, Hodges as instituted heir with a resolutory term whereunder his right to the
succession ceased in diem upon arrival of the resolutory term of his death on December 25, 1962 and her
brothers and sisters as instituted heirs with a suspensive term whereunder their right to the
succession commenced ex die upon arrival of the suspensive term of the death of C. N. Hodges on
December 25, 1962.
Hence, while agreeing with the main opinion that the proceeds of all remunerative dispositions made by
C. N. Hodges after his wife’s death remain an integral part of his wife’s estate which she willed to her
brothers and sisters, I submit that C. N. Hodges could not validly make gratuitous dispositions of any part
or all of his wife’s estate — “completely and absolutely dispose of any portion thereof inter vivos to
anyone other than himself” in the language of the main opinion, supra — and thereby render ineffectual
and nugatory her institution of her brothers and sisters as her designated heirs to succeed to
her whole estate “at the death of (her) husband.” If according to the main opinion, Hodges could not make
such gratuitous “complete and absolute dispositions” of his wife Linnie’s estate “mortis causa,” it would
seem that by the same token and rationale he was likewise proscribed by the will from making such
dispositions of Linnie’s estate inter vivos.
I believe that the two questions of renvoi and renunciation should be
resolved preferentially and expeditiously by the probate court ahead of the partition and segregation of
the minimum one-fourth of the conjugal or community properties constituting Linnie Jane
Hodges’ separate estate, which task considering that it is now seventeen (17) years since Linnie Jane
Hodges’ death and her conjugal estate with C. N. Hodges has remained unliquidated up to now might
take a similar number of years to unravel with the numerous items, transactions and details of the sizable
estates involved.
Such partition of the minimum one-fourth would not be final, since if the two prejudicial questions
of renvoi and renunciation were resolved favorably to Linnie’s estate meaning to say that if it should be
held that C. N. Hodges is not entitled to any legitime of her estate and at any rate he had totally
renounced his inheritance under the will), then Linnie’s estate would consist not only of the minimum one-
fourth but one-half of the conjugal or community properties of the Hodges spouses, which would require
again the partition and segregation of still another one-fourth of said. properties
to complete Linnie’s separate estate.
My differences with the main opinion involve further the legal concepts, effects and consequences of the
testamentary dispositions of Linnie Jane Hodges in her will and the question of the best to reach a
solution of the pressing question of expediting the closing of the estates which after all do not appear to
involve any outstanding debts nor any dispute between the heirs and should therefore be promptly settled
now after all these years without any further undue complications and delays and distributed to the heirs
for their full enjoyment and benefit. As no consensus appears to have been reached thereon by a majority
of the Court, I propose to state views as concisely as possible with the sole end in view that they may be
of some assistance to the probate court and the parties in reaching an expeditious closing and settlement
of the estates of the Hodges spouses.

Two Assumptions
As indicated above, the declaration of the minimum of Mrs. Hodges’ estate as one-fourth of the conjugal
properties is based on two assumptions most favorable to C. N. Hodges’ estate and his heirs, namely (1)
that the probate court must accept the renvoi or “reference back” 11allegedly provided by the laws of the
State of Texas (of which state the Hodges spouses were citizens) whereby the civil laws of the Philippines
as the domicile of the Hodges spouses would govern their succession notwithstanding the provisions of
Article 16 of our Civil Code (which provides that the national law of the decedents, in this case, of Texas,
shall govern their succession) with the result that her estate would consist of no more than one-fourth of
the conjugal properties since the legitime of her husband (the other one-fourth of said conjugal properties
or one-half of her estate, under Article 900 of our Civil Code) could not then be disposed of nor burdened
with any condition by her and (2) that C.N. Hodges had not effectively and legally renounced his
inheritance under his wife’s will.
These two assumptions are of course flatly disputed by respondent-appellee Magno as Mrs. Hodges’
administratrix, who avers that the law of the State of Texas governs her succession and does not provide
for and legitime, hence, her brothers and sisters are entitled to succeed to the whole of her share of the
conjugal properties which is one-half thereof and that in any event, Hodges had totally renounced all his
rights under the will.
The main opinion concedes that “(I)n the interest of settling the estates herein involved soonest, it would
be best, indeed, if these conflicting claims of the parties were determined in these proceedings.” It
observes however that this cannot be done due to the inadequacy of the evidence submitted by the
parties in the probate court and of the parties’ discussion, viz, “there is no clear and reliable proof of what
the possibly applicable laws of Texas are. Then also, the genuineness of the documents relied upon by
respondent Magno [re Hodges' renunciation] is disputed.” 12

Hence, the main opinion expressly reserves resolution and determination on these two conflicting claims
and issues which it deems “are not properly before the Court now,” 13and specifically holds that
“(A)ccordingly, the only question that remains to be settled in the further proceedings hereby ordered to
be held in the court below is how much more than as fixed above is the estate of Mrs. Hodges, and this
would depend on (1) whether or not the applicable laws of Texas do provide in effect for more, such as,
when there is no legitime provided therein, and (2) whether or not Hodges has validly waived his whole
inheritance from Mrs. Hodges.” 14

Suggested guidelines
Considering that the only unresolved issue has thus been narrowed down and in consonance with the
ruling spirit of our probate law calling for the prompt settlement of the estates of deceased persons for the
benefit of creditors and those entitled to the residue by way of inheritance — considering that the estates
have been long pending settlement since 1957 and 1962, respectively — it was felt that the Court should
lay down specific guidelines for the guidance of the probate court towards the end that it may expedite the
closing of the protracted estates proceedings below to the mutual satisfaction of the heirs and without
need of a dissatisfied party elevating its resolution of this only remaining issue once more to this Court
and dragging out indefinitely the proceedings.
After all, the only question that remains depends for its determination on the resolution of the two
questions of renvoi and renunciation, i.e. as to whether C. N. Hodges can claim a legitime and whether he
had renounced the inheritance. But as already indicated above, the Court without reaching a consensus
which would finally resolve the conflicting claims here and now in this case opted that “these and other
relevant matters should first be threshed out fully in the trial court in the proceedings hereinafter to be
held for the purpose of ascertaining and/or distributing the estate of Mrs. Hodges to her heirs in
accordance with her duly probated will.” 15

The writer thus feels that laying down the premises and principles governing the nature, effects and
consequences of Linnie Jane Hodges’ testamentary dispositions in relation to her conjugal partnership
and co-ownership of properties with her husband C. N. Hodges and “thinking out” the end results,
depending on whether the evidence directed to be formally received by the probate court would bear out
that under renvoi C. N. Hodges was or was not entitled to claim a legitime of one-half of his wife Linnie’s
estate and/or that he had or had not effectively and validly renounced his inheritance should help clear
the decks, as it were, and assist the probate court in resolving the only remaining question of how much
more than the minimum one-fourth of the community properties of the Hodges spouses herein finally
determined should be awarded as the separate estate of Linnie, particularly since the views expressed in
the main opinion have not gained a consensus of the Court. Hence, the following suggested guidelines,
which needless to state, represent the personal opinion and views of the writer:
1. To begin with, as pointed out in the main opinion, “according to Hodges’ own inventory submitted by
him as executor of the estate of his wife, practically all their properties were conjugal which means that
the spouses have equal shares therein.” 16
2. Upon the death of Mrs. Hodges on May 23, 1957, and the dissolution thereby of the marriage, the law
imposed upon Hodges as surviving husband the duty of inventorying, administering and liquidating the
conjugal or community property. 17Hodges failed to discharge this duty of liquidating the conjugal
partnership and estate. On the contrary, he sought and obtained authorization from the probate court
to continue the conjugal partnership’s business of buying and selling real and personal properties.
In his annual accounts submitted to the probate court as executor of Mrs. Hodges’ estate, Hodges
thus consistently reported the considerable combined income (in six figures) of the conjugal partnership
or coownership and then divided the same equally between himself and Mrs. Hodges’ estate and as
consistently filed separate income tax returns and paid the income taxes for each resulting half of
such combined income corresponding to his own and to Mrs. Hodges’ estate. 18 (Parenthetically, he
could not in law do this, had he adjudicated Linnie’s entire estate to himself, thus supporting the view
advanced even in the main opinion that “Hodges waived not only his rights to the fruits but to the
properties themselves.” 19
By operation of the law of trust 20as well as by his own acknowledgment and acts, therefore, all
transactions made by Hodges after his wife’s death were deemed for and on behalf of their unliquidated
conjugal partnership and community estate and were so reported and treated by him.
3. With this premise established that all transactions of Hodges after his wife’s death were for and on
behalf of their unliquidated conjugal partnership and community estate, share and share alike, it should
be clear that no gratuitous dispositions, if any, made by C. N. Hodges from his wife Linnie’s estate should
be deducted from her separate estate as held in the main opinion. On the contrary, any such gratuitous
dispositions should be charged to his own share of the conjugal estate since he had no authority or right
to make any gratuitous dispositions of Linnie’s properties to the prejudice of her brothers and sisters
whom she called to her succession upon his death, not to mention that the very authority obtained by him
from the probate court per its orders of May 25, and December 14, 1957 was to continue the conjugal
partnership’s business of buying and selling real properties for the account of their unliquidated conjugal
estate and co-ownership, share and share alike and not to make any free dispositions of Linnie’s estate.
4. All transactions as well after the death on December 25, 1962 of Hodges himself appear perforce and
necessarily to have been conducted, on the same premise, for and on behalf of their unliquidated
conjugal partnership and/or co-ownership, share and share alike — since the conjugal partnership
remained unliquidated — which is another way of saying that such transactions, purchases and sales,
mostly the latter, must be deemed in effect to have been made for the respective estates of C. N. Hodges
and of his wife Linnie Jane Hodges, as both estates continued to have an equal stake and share in the
conjugal partnership which was not only left unliquidated but continued as a co-ownership or joint
business with the probate court’s approval by Hodges during the five-year period that he survived his
wife.
This explains the probate court’s action of requiring that deeds of sale executed by PCIB as Hodges’
estate’s administrator be “signed jointly” by respondent Magno as Mrs. Hodges’ estate’s administratrix, as
well as its order authorizing payment by lot purchasers from the Hodges to either estate, since “there is as
yet no judicial declaration of heirs nor distribution of properties to whomsoever are entitled thereto.” 22

And this equally furnishes the rationale of the main opinion for continued conjoint administration by the
administrators of the two estates of the deceased spouses, “pending the liquidation of the conjugal
partnership,” 23since “it is but logical that both estates should be administered jointly by the representatives
of both, pending their segregation from each other. Particularly … because the actuations so far of PCIB
evince a determined, albeit groundless, intent to exclude the other heirs of Mrs. Hodges from their
inheritance.” 24 5. Antly by the representatives of both, pending their segregation from each other.
Particularly … because the actuations so far of PCIB evince a determined, albeit groundless, intent to
exclude the other heirs of Mrs. Hodges from their inheritance.” 24

5. As stressed in the main opinion, the determination of the only unresolved issue of how much more than
the minimum of one-fourth of the community or conjugal properties of the Hodges spouses pertains to
Mrs. Hodges’ estate depends on the twin questions of renunciation and renvoi. It directed consequently
that “a joint hearing of the two probate proceedings herein involved” be held by the probate court for the
reception of “further evidence” in order to finally resolved these twin questions. 25

(a) On the question of renunciation, it is believed that all that the probate court has to do is to receive
formally in evidence the various documents annexed to respondent Magno’s answer at bar, 26namely:
Copy of the U.S. Estate Tax Return filed on August 8, 1958 by C. N. Hodges for his wife Linnie’s estate
wherein he purportedly declared that he was renouncing his inheritance under his wife’s will in favor
of her brothers and sisters as co-heirs designated with him and that it was his “intention (as) surviving
husband of the deceased to distribute the remaining property and interests of the deceased in their
community estate to the devisee and legatees named in the will when the debts, liabilities, taxes and
expenses of administration are finally determined and paid;” 27and
The affidavit of ratification of such renunciation (which places him in estoppel) allegedly executed on
August 9, 1962 by C. N. Hodges in Iloilo City wherein he reaffirmed that “… on August 8, 1958,
I renounced and disclaimed any and all right to receive the rents, emoluments and income from said
estate” and further declared that “(T)he purpose of this affidavit is to ratify and confirm, and I do hereby
ratify and confirm, the declaration made in schedule M of said return and hereby formally disclaim and
renounce any right on my part to receive any of the said rents, emoluments and income from the estate of
my deceased wife, Linnie Jane Hodges. This affidavit is made to absolve me or my estate from any
liability for the payment of income taxes on income which has accrued to the estate of Linnie Jane
Hodges since the death of the said Linnie Jane Hodges on May 23, 1957.” 28

(b) On the question of renvoi, all that remains for the probate court to do is to formally receive in evidence
duly authenticated copies of the laws of the State of Texas governing the succession of Linnie Jane
Hodges and her husband C. N. Hodges as citizens of said State at the time of their respective deaths
on May 23, 1957 and December 25, 1962. 29
6. The text and tenor of the declarations by C. N. Hodges of renunciation of his inheritance from his wife
in favor of her other named heirs in her will (her brothers and sisters and their respective heirs) as ratified
and reiterated expressly in his affidavit of renunciation executed four years later for the avowed purpose
of not being held liable for payment of income taxes on income which has accrued to his wife’s estate
since her death indicate a valid and effective renunciation.
Once the evidence has been formally admitted and its genuineness and legal effectivity established by
the probate court, the renunciation by C. N. Hodges must be given due effect with the result that C. N.
Hodges therefore acquired no part of his wife’s one-half share of the community properties since he
removed himself as an heir by virtue of his renunciation. By simple substitution then under Articles 857
and 859 of our Civil Code 30and by virtue of the will’s institution of heirs, since “the heir originally instituted
C. N. Hodges) does not become an heir” 31by force of his renunciation, Mrs. Hodges’ brothers and sisters
whom she designated as her heirs upon her husband’s death are called immediately to her succession.
Consequently, the said community and conjugal properties would then pertain pro indiviso share and
share alike to their respective estates, with each estate, however, shouldering its own expenses of
administration, estate and inheritance taxes, if any remain unpaid, attorneys’ fees and other like expenses
and the net remainder to be adjudicated directly to the decedents’ respective brothers and sisters (and
their heirs) as the heirs duly designated in their respective wills. The question of renvoi becomes
immaterial since most laws and our laws permit such renunciation of inheritance.
7. If there were no renunciation (or the same may somehow be declared to have not been valid and
effective) by C. N. Hodges of his inheritance from his wife, however, what would be the consequence?
(a) If the laws on succession of the State of Texas do provide for renvoi or “reference back” to Philippine
law as the domiciliary law of the Hodges’ spouses governing their succession, then petitioners’ view that
Mrs. Hodges’ estate would consist only of the minimum of “one-fourth of the community properties of the
said spouses, as of the time of (her) death on May 23, 1957″ would have to be sustained and C. N.
Hodges’ estate would consist of three-fourths of the community properties, comprising his own one-half
(or two-fourths) share and the other fourth of Mrs. Hodges’ estate as the legitime granted him as surviving
spouse by Philippine law (Article 900 of the Civil Code) which could not be disposed of nor burdened with
any condition by Mrs. Hodges as testatrix.
(b) If the laws on succession of the State of Texas do not provide for such renvoi and respondent
Magno’s assertion is correct that the Texas law which would then prevail, provides for no legitime for C.
N. Hodges as the surviving spouse, then respondent Magno’s assertion that Mrs. Hodges’ estate would
consist of one-half of the community properties (with the other half pertaining to C. N. Hodges) would
have to be sustained. The community and conjugal properties would then pertain share and share alike to
their respective estates, with each estate shouldering its own expenses of administration in the same
manner stated in the last paragraph of paragraph 6 hereof. .
8. As to the nature of the institution of heirs made by Mrs. Hodges in her will, the main opinion holds that
“(T)he brothers and sisters of Mrs. Hodges are not substitutes for Hodges; rather, they are also heirs
instituted simultaneously with Hodges,” but goes further and holds that “it was not the usufruct alone of
her estate … that she bequeathed to Hodges during his lifetime, but the full ownership thereof, although
the same was to last also during his lifetime only, even as there was no restriction against his disposing or
conveying the whole or any portion thereof anybody other than himself” and describes Hodges
“as universal and sole heir with absolute dominion over Mrs. Hodges’ estate (except over their Lubbock,
Texas property ), 32adding that “Hodges was not obliged to preserve anything for them” (referring to Mrs.
Hodges’ brothers and sisters as instituted co-heirs). 33

Contrary to this view of the main opinion, the writer submits that the provisions of Mrs. Hodges’ will
did not grant to C.N. Hodges “full ownership” nor “absolute dominion” over her estate, such that he could
as “universal and sole heir” by the mere expedient of gratuitously disposing to third persons
her whole estate during his lifetime nullify her institution of her brothers and sisters as his co-heirs to
succeed to her whole estate “at the death of (her) husband,” deprive them of any inheritance and make
his own brothers and sisters in effect sole heirs not only of his own estate but of his wife’s estate as well.
Thus, while Linnie Jane Hodges did not expressly name her brothers and sisters as substitutes for
Hodges because she willed that they would enter into the succession upon his death, still it cannot be
gainsaid, as the main opinion concedes, “that they are also heirs instituted simultaneously with Hodges,
subject however to certain conditions, partially resolutory insofar as Hodges was concerned and
correspondingly suspensive with reference to his brothers and sisters-in-law.” 34

Hence, if Hodges is found to have validly renounced his inheritance, there would be a substitution of heirs
in fact and in law since Linnie’s brothers and sisters as the heirs “simultaneously instituted” with
a suspensive term would be called immediately to her succession instead of waiting for the arrival
of suspensive term of Hodges’ death, since as the heir originally instituted he does not become an heir by
force of his renunciation and therefore they would “enter into the inheritance in default of the heir originally
instituted” (Hodges) under the provisions of Article 857 and 859 of our Civil Code, supra, 35thus
accelerating their succession to her estate as a consequence of Hodges’ renunciation.
Consequently, Linnie Jane Hodges willed that her husband C.N. Hodges would “during his natural lifetime
… manage, control, use and enjoy said estate” and that only “all rents,
emoluments and income“ alone shall belong to him. She further willed that while he
could sell and purchase properties of her estate, and “use any part of the principal estate,” such principal
notwithstanding “any changes in the physical properties of said estate”(i.e. new properties acquired or
exchanged) would still pertain to her estate, which at the time of his death would pass in full dominion to
her brothers and sisters as the ultimate sole and universal heirs of her estate. 36
The testatrix Linnie Jane Hodges in her will thus principally provided that “I give, devise and bequeath all
of the rest, residue and remainder of my estate, both personal and real … to my beloved husband,
Charles Newton Hodges, to have and to hold with him … during his natural lifetime;” 37that “(he) shall have
the right to manage, control, use and enjoy said estate during his lifetime, … to make any changes in
the physical properties of said estate, by sale … and the purchase of any other or additional property as
he may think best … . All rents, emoluments and income from said estate shall belong to him and he is
further authorized to use any part of the principal of said estate as he may need or desire, … he shall not
sell or otherwise dispose of any of the improved property now owned by us, located at … City of Lubbock,
Texas … . He shall have the right to subdivide any farm land and sell lots therein, and may
sell unimproved town lots;” 38that “(A)t the death of my said husband, Charles Newton, I give, devise and
bequeath all of the rest, residue and remainder of my estate, both personal and real, … to be equally
divided among my brothers and sisters, share and share alike, namely: Esta Higdon, Emma Howell,
Leonard Higdon, Roy Higdon, Sadie Rascoe, Era Roman and Nimroy Higdon;” 39and that “(I)n case of the
death of any of my brothers and/or sisters … prior to the death of my husband … the heirs of such
deceased brother or sister shall take jointly the share which would have gone to such brother or sister had
she or he survived.” 40
Such provisions are wholly consistent with the view already fully expounded above that all transactions
and sales made by Hodges after his wife Linnie’s death were by operation of the law of trust as well as
by his own acknowledgment and acts deemed for and on behalf of their unliquidated conjugal partnership
and community estate, share and share alike, with the express authorization of the probate court per its
orders of May 25, and December 14, 1957 granting Hodges’ motion to continue the conjugal partnership
business of buying and selling real estate even after her death. By the same token, Hodges could not
conceivably be deemed to have had any authority or right to dispose gratuitously of any portion of her
estate to whose succession she had called her brothers and sisters upon his death.
9. Such institutions of heirs with a term are expressly recognized and permitted under Book III, Chapter 2,
section 4 of our Civil Code dealing with “conditional testamentary dispositions and testamentary
dispositions with a term.” 41
Thus, Article 885 of our Civil Code expressly provides that:

ART 885. The designation of the day or time when the effects of the institution of an heir
shall commence or cease shall be valid.
In both cases, the legal heir shall be considered as called to the succession until the arrival of the period
or its expiration. But in the first case he shall not enter into possession of the property until after having
given sufficient security, with the intervention of the instituted heir.

Accordingly, under the terms of Mrs. Hodges’ will, her husband’s right to the succession as the instituted
heir ceased in diem, i.e. upon the arrival of the resolutory term of his death on December 25, 1962, while
her brothers’ and sisters’ right to the succession also as instituted heirs commenced ex die, i.e. upon the
expiration of the suspensive term (as far as they were concerned) of the death of C. N. Hodges on
December 25, 1962 . 42
As stated in Padilla’s treatise on the Civil Code, “A term is a period whose arrival is certain although the
exact date thereof may be uncertain. A term may have either a suspensive or a resolutory effect. The
designation of the day when the legacy “shall commence” is ex die, or a term with a suspensive
effect, from a certain day. The designation of the day when the legacy “shall cease” is in diem or a term
with a resolutory effect, until a certain day.” He adds that “A legacy based upon a certain age or upon
the death of a person is not a condition but a term. If the arrival of the term would commence the right of
the heir, it is suspensive. If the arrival of the term would terminate his right, it is resolutory” and that “upon
the arrival of the period, in case of a suspensive term, the instituted heir is entitled to the succession, and
in case of a resolutory term, his right terminates.” 43

10. The sizable estates herein involved have now been pending settlement for a considerably protracted
period (of seventeen years counted from Linnie’s death in 1957), and all that is left to be done is to
resolve the only remaining issue (involving the two questions of renunciation and renvoi) hereinabove
discussed in order to close up the estates and finally effect distribution to the deceased spouses’
respective brothers and sisters and their heirs as the heirs duly instituted in their wills long admitted to
probate. Hence, it is advisable for said instituted heirs and their heirs in turn 44to come to terms for the
adjudication and distribution to them pro-indiviso of the up to now unliquidated community properties of
the estates of the Hodges spouses (derived from their unliquidated conjugal partnership) rather than to
get bogged down with the formidable task of physically segregating and partitioning the two estates with
the numerous transactions, items and details and physical changes of properties involved. The estates
proceedings would thus be closed and they could then name their respective attorneys-in-fact to work out
the details of segregating, dividing or partitioning the unliquidated community properties or liquidating
them — which can be done then on their own without further need of intervention on the part of the
probate court as well as allow them meanwhile to enjoy and make use of the income and cash and liquid
assets of the estates in such manner as may be agreed upon between them.
Such a settlement or modus vivendi between the heirs of the unliquidated two estates for the mutual
benefit of all of them should not prove difficult, considering that it appears as stated in the main opinion
that 22.968149% of the share or undivided estate of C. N. Hodges have already been acquired by the
heirs of Linnie Jane Hodges from certain heirs of her husband, while certain other heirs representing
17.34375% of Hodges’ estate were joining cause with Linnie’s heirs in their pending and unresolved
motion for the removal of petitioner PCIB as administrator of Hodges’ estate, 45apparently impatient with
the situation which has apparently degenerated into a running battle between the administrators of the
two estates to the common prejudice of all the heirs.
11. As earlier stated, the writer has taken the pain of suggesting these guidelines which may serve to
guide the probate court as well as the parties towards expediting the winding up and closing of the
estates and the distribution of the net estates to the instituted heirs and their successors duly entitled
thereto. The probate court should exert all effort towards this desired objective pursuant to the mandate of
our probate law, bearing in mind the Court’s admonition in previous cases that “courts of first instance
should exert themselves to close up estate within twelve months from the time they are presented,
and they may refuse to allow any compensation to executors and administrators who do not actively
labor to that end, and they may even adopt harsher measures.” 46
Timeliness of appeals and imposition of
thirty-one (31) additional docket fees
Two appeals were docketed with this Court, as per the two records on appeal submitted (one with a green
cover and the other with a yellow cover). As stated at the outset, these appeals involve basically the same
primal issue raised in the petition for certiorari as to whether there still exists a separate estate of Linnie
Jane Hodges which has to continue to be administered by respondent Magno. Considering the main
opinion’s ruling in the affirmative and that her estate and that of her husband (since they jointly
comprise unliquidated community properties) must be administered conjointly by their respective
administrators (PCIB and Magno), the said appeals (involving thirty-three different orders of the probate
court approving sales contracts and other acts of administration executed and performed by respondent
Magno on behalf of Linnie’s estate) have been necessarily overruled by the Court’s decision at bar.
(a) The “priority question” raised by respondent Magno as to the patent failure of the two records on
appeal to show on their face and state the material data that the appeals were timely taken within the 30-
day reglamentary period as required by Rule 41, section 6 of the Rules of Court, has been brushed aside
by the main opinion with the statement that it is “not necessary to pass upon the timeliness of any of said
appeals” since they “revolve around practically the same main issues and … it is admitted that some of
them have been timely taken.” 47The main opinion thus proceeded with the determination of the thirty-
three appealed orders despite the grave defect of the appellant PCIB’s records on appeal and their failure
to state the required material data showing the timeliness of the appeals.
Such disposition of the question of timeliness deemed as “mandatory and jurisdictional” in a number of
cases merits the writer’s concurrence in that the question raised has been subordinated to the paramount
considerations of substantial justice and a “liberal interpretation of the rules” applied so as not to derogate
and detract from the primary intent and purpose of the rules, viz ”the proper and just determination of a
litigation” 48 — which calls for “adherence to a liberal construction of the procedural rules in order to attain
their objective of substantial justice and of avoiding denials of substantial justice due to procedural
technicalities.” 49
Thus, the main opinion in consonance with the same paramount considerations of substantial justice has
likewise overruled respondents’ objection to petitioner’s taking the recourse of “the present remedy
of certiorari and prohibition” — “despite the conceded availability of appeal” — on the ground that “there is
a common thread among the basic issues involved in all these thirty-three appeals — (which) deal with
practically the same basic issues that can be more expeditiously resolved or determined in a single
special civil action . . . “ 50
(b) Since the basic issues have been in effect resolved in the special civil action at bar (as above stated)
with the dismissal of the petition by virtue of the Court’s judgment as to the continued existence of
a separate estate of Linnie Jane Hodges and the affirmance as a necessary consequence of the
appealed orders approving and sanctioning respondent Magno’s sales contracts and acts of
administration, some doubt would arise as to the propriety of the main opinion requiring the payment by
PCIB of thirty-one (31) additional appeal docket fees. This doubt is further enhanced by the question of
whether it would make the cost of appeal unduly expensive or prohibitive by requiring the payment of a
separate appeal docket fee for each incidental order questioned when the resolution of all such incidental
questioned orders involve basically one and the same main issue (in this case, the existence of a
separate estate of Linnie Jane Hodges) and can be more expeditiously resolved or determined in
a single special civil action” (for which a single docket fee is required) as stated in the main
opinion. 51Considering the importance of the basic issues and the magnitude of the estates involved,
however, the writer has pro hac vice given his concurrence to the assessment of the said thirty-one (31)
additional appeal docket fees.
Case digest

56 scra 266
Nationality Principle
Linnie Jane Hodges, a married woman and a citizen of Texas, USA, was a domiciliary of the Philippines
at the moment of her death. With respect to the validity of certain testamentary provisions she had made
in favor of her husband, a question arose as to what exactly were the laws of Texas on the matter at the
precise moment of her death (for while one group contended that the Texan law should result to renvoi,
the other group contended that no renvoi was possible).

ISSUE: Whether or not Texas Law should apply.

HELD: The Supreme Court held that for what the Texas law is on the matter, is a question of fact to be
resolved by the evidence that would be presented in the probate court. Texas law at the time of her death
(and not said law at any other time). NOTE: Dynamics of law.

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

FEDERICO C. SUNTAY, petitioner, vs. ISABEL COJUANGCO-

SUNTAY and HON. GREGORIO S. SAMPAGA, Presiding Judge,
*

Branch 78, Regional Trial Court, Malolos, Bulacan, respondents.

DECISION
MARTINEZ, J.:

Which should prevail between the ration decidendi and the fallo of a decision is the
primary issue in this petition for certiorari under Rule 65 filed by petitioner Federico C. Suntay
who opposes respondent Isabel’s petition for appointment as administratrix of her grandmother’s
estate by virtue of her right of representation.
The suit stemmed from the following:
On July 9, 1958, Emilio Aguinaldo Suntay (son of petitioner Federico Suntay) and Isabel
Cojuangco-Suntay were married in the Portuguese Colony of Macao. Out of this marriage, three
children were born namely: Margarita Guadalupe, Isabel Aguinaldo and Emilio Aguinaldo all
surnamed Cojuangco Suntay. After 4 years, the marriage soured so that in 1962, Isabel
Cojuanco-Suntay filed a criminal case[1] against her husband Emilio Aguinaldo Suntay. In
retaliation, Emilio Aguinaldo filed before the then Court of First Instance (CFI) [2] a complaint for
legal separation against his wife, charging her, among others, with infidelity and praying for the
custody and care of their children who were living with their mother. [3] The suit was docketed as
civil case number Q-7180.
On October 3, 1967, the trial court rendered a decision the dispositive portion which reads:

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

“With regard to counterclaim, in view of the manifestation of counsel that the third
party defendants are willing to pay P50,000.00 for damages and that defendant is
willing to accept the offer instead of her original demand for P130,000.00, the
defendant is awarded the sum of P50,000.00 as her counterclaim and to pay attorney’s
fees in the amount of P5,000.00.

“SO ORDERED.[4] (Emphasis supplied)

As basis thereof, the CFI said:

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

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

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

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

“xxx xxx xxx

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

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

On June 1, 1979, Emilio Aguinaldo Suntay predeceased his mother, the decedent Cristina
Aguinaldo-Suntay. The latter is respondent Isabel’s paternal grandmother. The decedent died
on June 4, 1990 without leaving a will.[6]
Five years later or on October 26 1995, respondent Isabel Aguinaldo Cojuangco Suntay filed
before the Regional Trial Court (RTC)[7] a petition for issuance in her favor of Letters of
Administration of the Intestate Estate of her late grandmother Cristina Aguinaldo Suntay which
case was docketed as Special Proceeding Case No. 117-M-95. In her petition, she alleged among
others, that she is one of the legitimate grandchildren of the decedent and prayed that she be
appointed as administratrix of the estate.[8]
On December 15, 1995, petitioner filed an Opposition claiming that he is the surviving
spouse of the decedent, that he has been managing the conjugal properties even while the
decedent has been alive and is better situated to protect the integrity of the estate than the
petitioner, that petitioner and her family have been alienated from the decedent and the
Oppositor for more than thirty (30) years and thus, prayed that Letters of Administration be
issued instead to him.[9]
On September 22, 1997 or almost two years after filing an opposition, petitioner moved to
dismiss the special proceeding case alleging in the main that respondent Isabel should not be
appointed as administratrix of the decedent’s estate. In support thereof, petitioner argues that
under Article 992 of the Civil Code an illegitimate child has no right to succeed by right of
representation the legitimate relatives of her father or mother. Emilio Aguinaldo Suntay,
respondent Isabel’s father predeceased his mother, the late Cristina Aguinaldo Suntay and thus,
opened succession by representation. Petitioner contends that as a consequence of the
declaration by the then CFI of Rizal that the marriage of the respondent Isabel’s parents is “null
and void,” the latter is an illegitimate child, and has no right nor interest in the estate of her
paternal grandmother – the decedent.[10] On October 16, 1997, the trial court issued the assailed
order denying petitioner’s Motion to Dismiss.[11] When his motion for reconsideration was denied
by the trial court in an order dated January 9, 1998, [12] petitioner, as mentioned above filed this
petition.
Petitioner imputes grave abuse of discretion to respondent court in denying his motion to
dismiss as well as his motion for reconsideration on the grounds that: (a) a motion to dismiss is
appropriate in a special proceeding for the settlement of estate of a deceased person; (b) the
motion to dismiss was timely filed; (c) the dispositive portion of the decision declaring the
marriage of respondent Isabel’s parents “null and void” must be upheld; and (d) said decision
had long become final and had, in fact, been executed.
 On the other hand, respondent Isabel asserts that petitioner’s motion to dismiss was late
having been filed after the opposition was already filed in court, the counterpart of an answer in
an ordinary civil action and that petitioner in his opposition likewise failed to specifically deny
respondent Isabel’s allegation that she is a legitimate child of Emilio Aguinaldo Suntay, the
decedent’s son. She further contends that petitioner proceeds from a miscomprehension of the
judgment in Civil Case No. Q-7180 and the erroneous premise that there is a conflict between
the body of the decision and its dispositive portion because in an action for annulment of a
marriage, the court either sustains the validity of marriage or nullifies it. It does not, after
hearing a marriage “voidable” otherwise, the court will fail to decide and lastly, that the status of
marriages under Article 85 of the Civil Code before they are annulled is “voidable.”
The petition must fail.
Certiorari as a special civil action can be availed of only if there is concurrence of the
essential requisites, to wit: (a) the tribunal, board or officer exercising judicial functions has
acted without or in excess of jurisdiction or with grave abuse of discretion amounting to lack or
in excess or jurisdiction, and (b) there is no appeal, nor any plain, speedy and adequate remedy in
the ordinary course of law for the purpose of annulling or modifying the proceeding. [13] There
must be a capricious, arbitrary and whimsical exercise of power for it to prosper.[14]
A reading of the assailed order, however, shows that the respondent court did not abuse its
discretion in denying petitioner’s motion to dismiss, pertinent portions of which are quoted
hereunder. To with:

“The arguments of both parties judiciously and objectively assessed and the pertinent
laws applied, the Court finds that a motion to dismiss at this juncture is inappropriate
considering the peculiar nature of this special proceeding as distinguished from an
ordinary civil action. At the outset, this proceeding was not adversarial in nature and
the petitioner was not called upon to assert a cause of action against a particular
defendant. Furthermore, the State has a vital interest in the maintenance of the
proceedings, not only because of the taxes due it, but also because if no heirs qualify,
the State shall acquire the estate by escheat.

“xxx xxx xxx

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

“The oppositor’s contention that the fallo of the questioned decision (Annex “A” –
Motion) prevails over the body thereof is not of a final decision is definite, clear and
unequivocal and can be wholly given effect without need of interpretation or
construction.
“Where there is ambiguity or uncertainty, the opinion or body of the decision may be
referred to for purposes of construing the judgement” (78 SCRA 541 citing Morelos v.
Go Chin Ling; and Heirs of Juan Presto v. Galang). The reason is that the dispositive
portion must find support from the decision’s ratio decidendi.

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

The trial court correctly ruled that “a motion to dismiss at this juncture is
inappropriate.” The 1997 Rules of Civil Procedure governs the procedure to be observed in
actions, civil or criminal and special proceedings.”[16] The Rules do not only apply to election
cases, land registration, cadastral, naturalization and insolvency proceedings, and other cases not
therein provided for.
Special proceedings being one of the actions under the coverage of the Rules on Civil
Procedure, a motion to dismiss filed thereunder would fall under Section 1, Rule 16
thereof. Said rule provides that the motion to dismiss may be filed “within the time for but
before filing the answer to the complaint.” Clearly, the motion should have been filed on or
before the filing of petitioner’s opposition. [17] which is the counterpart of an answer in ordinary
civil actions.
Not only was petitioner’s motion to dismiss filed out of time, it was filed almost two years
after respondent Isabel was already through with the presentation of her witnesses and evidence
and petitioner had presented two witnesses. The filing of the motion to dismiss is not only
improper but also dilatory.
The respondent court, far from deviating or straying off course from established
jurisprudence on this matter, as petitioner asserts, had in fact faithfully observed the law and
legal precedents in this case. In fact, the alleged conflict between the body of the decision and
the dispositive portion thereof which created the ambiguity or uncertainty in the decision of the
CFI of Rizal is reconcilable. The legal basis for setting aside the marriage of respondent Isabel’s
parents is clear under paragraph 3, Article 85 of the New Civil Code, the law in force prior to the
enactment of the Family Code.
Petitioner, however, strongly insists that the dispositive portion of the CFI decision has
categorically declared that the marriage of respondent Isabel’s parents is “null and void” and that
the legal effect of such declaration is that the marriage from its inception is void and the children
born out of said marriage is illegitimate. Such argument cannot be sustained. Articles 80, 81, 82
and 83[18] of the New Civil Code classify what marriages are void while Article 85 enumerates
the causes for which a marriage may be annulled.[19]
The fundamental distinction between void and voidable marriages is that void marriage is
deemed never to have taken place at all. The effects of void marriages, with respect to property
relations of the spouses are provided for under Article 144 of the Civil Code. Children born of
such marriages who are called natural children by legal fiction have the same status, rights and
obligations as acknowledged natural children under Article 89 [20] irrespective of whether or not
the parties to the void marriage are in good faith or in bad faith.
On the other hand, a voidable marriage, is considered valid and produces all its civil effects,
until it is set aside by final judgment of a competent court in an action for
annulment. Juridically, the annulment of a marriage dissolves the special contract as if it had
never been entered into but the law makes express provisions to prevent the effects of the
marriage from being totally wiped out. The status of children born in voidable marriages is
governed by the second paragraph of Article 89 which provides that:

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

Stated otherwise, the annulment of “the marriage by the court abolishes the legal character
of the society formed by the putative spouses, but it cannot destroy the juridical consequences
which the marital union produced during its continuance.”[22]
Indeed, the terms “annul” and “null and void” have different legal connotations and
implications. Annul means to reduce to nothing; annihilate; obliterate; to make void or of no
effect; to nullify; to abolish; to do away with[23] whereas null and void is something that does not
exist from the beginning. A marriage that is annulled presupposes that it subsists but later ceases
to have legal effect when it is terminated through a court action. But in nullifying a marriage, the
court simply declares a status condition which already exists from the very beginning.
There is likewise no merit in petitioner’s argument that it is the dispositive portion of the
decision which must control as to whether or not the marriage of respondent Isabel’s parents was
void or voidable. Such argument springs from a miscomprehension of the judgment of the Civil
Case No. Q-7180 and the erroneous premise that there is a conflict between the body of the
decision and its dispositive portion.
Parenthetically, it is an elementary principle of procedure that the resolution of the court in a
given issue as embodied in the dispositive part of a decision or order is the controlling factor as
to settlement of rights of the parties and the questions presented, notwithstanding statement in
the body of the decision or order which may be somewhat confusing, [24] the same is not without
qualification. The foregoing rule holds true only when the dispositive part of a final decision or
order is definite, clear and unequivocal and can be wholly given effect without need of
interpretation or construction – which usually is “the case where the order or decision in question
is that of a court not of record which is not constitutionally required to state the facts and the law
on which the judgment is based.”[25]
Assuming that a doubt or uncertainty exists between the dispositive portion and the body of
the decision, effort must be made to harmonize the whole body of the decision in order to give
effect to the intention, purpose and judgment of the court. In Republic v. delos Angeles[26] the
Court said:

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

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

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

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

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

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

xxx xxx xxx

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

xxx xxx xxx

“There is a dearth of proof at the time of the marriage defendant knew about the mental
condition of plaintiff; and there is proof that plaintiff continues to be without sound reason. The
charges in this very complaint add emphasis to the finding of the neuro-psychiatrist handling the
patient, that plaintiff really lives more in fancy than in reality, a strong indication of
schizophernia (sic).”[27]

Inevitably, the decision of the CFI of Rizal declared null and void the marriage of respondent
Isabel’s parents based on paragraph 3, Article 85 of the New Civil Code. The legal
consequences as to the rights of the children are therefore governed by the first clause of the
second paragraph of Article 89. A contrary interpretation would be anathema to the rule just
above-mentioned. Based on said provision the children of Emilio Aguinaldo Suntay and Isabel
Cojuangco-Suntay who were conceived and born prior to the decree of the trial court setting
aside their marriage on October 3, 1967 are considered legitimate. For purposes of seeking
appointment as estate administratrix, the legitimate grandchildren, including respondent Isabel,
may invoke their successional right of representation in the estate of their grandmother Cirstina
Aguinaldo Suntay after their father, Emilio Aguinaldo Suntay, had predeceased their
grandmother. This is, however, without prejudice to a determination by the courts of whether
Letters of Administration may be granted to her. Neither do the Court adjudged herein the
successional rights of the personalities involved over the decedent’s estate.
It would not therefore be amiss to reiterate at this point what the Court, speaking through
Chief Justice Ruiz Castro, emphasized to “all magistrates of all levels of the judicial hierarchy
that extreme degree of care should be exercised in the formulation of the dispositive portion of a
decision, because it is this portion that is to be executed once the decision becomes final. The
adjudication of the rights and obligations of thoe parties, and the dispositions made as well as the
directions and instructions given by the court in the premises in conformity with the body of the
decision, must all be spelled out clearly, distinctly and unequivocally leaving absolutely no room
for dispute, debate or interpretation.[28]
WHEREFORE, finding no grave abuse of discretion, the instant petition is
DISMISSED.
SO ORDERED.

OH HEK HOW vs REPUBLIC 29 SCRA 94

Facts:

Petitioner Oh Hek How having been granted naturalization through his petition filed a motion alleging that he had
complied with the requirements of Republic Act No. 530 and praying that he be allowed to take his oath of
allegiance as such citizen and issued the corresponding certificate of naturalization. The Court of First Instance of
Zamboanga del Norte issued forthwith an order authorizing the taking of said oath. On that same date, petitioner
took it and the certificate of naturalization was issued to him. The Government seasonably gave notice of its
intention to appeal from said order of February9, 1966 and filed its record on appeal among the grounds that the
oath was taken prior to judgment having been final and executory.

Issue:

- Is the oath valid

- Whether or not a permission to renounce citizenship is necessary from the Minister of the Interior of Nationalist
China.

Held:

First issue:
The order of February 9, 1966 (oath-taking) had not — and up to the present has not become final and executoryin
view of the appeal duly taken by the Government.

2nd Issue:
It is argued that the permission is not required by our laws and that the naturalization of an alien, as a citizen of
the Philippines, is governed exclusively by such laws and cannot be controlled by any foreign law.

However, the question of how a Chinese citizen may strip himself of that status is necessarily governed —pursuant
to Articles 15 and 16 of our Civil Code — by the laws of China, not by those of the Philippines. As a consequence, a
Chinese national cannot be naturalized as a citizen of the Philippines, unless he has complied with the laws of
Nationalist China requiring previous permission of its Minister of the Interior for the renunciation of nationality.

Section 12 of Commonwealth Act No.473 provides, however, that before the naturalization certificate is issued,
the petitioner shall "solemnly swear," interalia, that he renounces "absolutely and forever all allegiance and
fidelity to any foreign prince, potentate" and particularly to the state "of which" he is "a subject or citizen." The
obvious purpose of this requirement is to divest him of his former nationality, before acquiring Philippine
citizenship, because, otherwise, he would have two nationalities and owe allegiance to two (2) distinct
sovereignties, which our laws do not permit, except that, pursuant to Republic Act No. 2639, "the acquisition of
citizenship by a natural-born Filipino citizen from one of the Iberian and any friendly democratic Ibero-American
countries shall not produce loss or forfeiture of his Philippine citizenship, if the law of that country grants the
same privilege to its citizens and such had been agreed upon by treaty between the Philippines and the foreign
country from which citizenship is acquired."

ROMUALDEZ-MARCOS vs. COMELEC

G.R. No. 119976, September 18, 1995

FACTS:

Petitioner Imelda Romualdez-Marcos filed her Certificate of Candidacy (COC) for the position
of Representative of the First District of Leyte, stating that she is 7-months resident in the
said district. Private respondent Montejo, incumbent Representative and a candidate for the
same position, filed a Petition for Cancellation and Disqualification, alleging that petitioner
did not meet the constitutional one-year residency requirement. Petitioner thus amended
her COC, changing “seven” months to “since childhood.” The provincial
election supervisorrefused to admit the amended COC for the reason that it was filed out of
time. Petitioner, thus, filed her amended COC with COMELEC in division.

The COMELEC Second Division found the petition for disqualification meritorious and struck
off the amended as well as original COCs. In ruling thus, COMELEC in division found that
when petitioner chose to stay in Ilocos and later on in Manila, coupled with her intention to
stay there by registering as a voter there and expressly declaring that she is a resident of
that place, she is deemed to have abandoned Tacloban City, where she spent her childhood
and school days, as her place of domicile. The COMELEC en banc affirmed this ruling.

During the pendency of the disqualification case, petitioner won in the election. But the
COMELEC suspended her proclamation.

ISSUES:

1. Whether or not petitioner was a resident, for election purposes, of the FirstDistrict of
Leyte for a period of one year at the time of the May 9, 1995elections.
2. Whether or not the COMELEC properly exercised its jurisdiction in disqualifying petitioner
outside the period mandated by the Omnibus Election Code for disqualification cases under
Article 78 of the said Code.

3) Whether or not the House of Representatives Electoral Tribunal assumed exclusive

jurisdiction over the question of petitioner's qualifications after the May 8, 1995 elections.

HELD:

Domicile vs. Residence

In Ong vs. Republic, this court took the concept of domicile to mean anindividual's
"permanent home", "a place to which, whenever absent for business or for pleasure, one
intends to return, and depends on facts and circumstances in the sense that they disclose
intent." Based on the foregoing, domicile includes the twin elements of "the fact of residing
or physical presence in a fixed place" and animus manendi, or the intention of returning
there permanently.

Residence, in its ordinary conception, implies the factual relationship of anindividual to a

certain place. It is the physical presence of a person in a given area, community or country.
The essential distinction between residence and domicile in law is that residence involves
the intent to leave when the purpose for which the resident has taken up his abode ends.
One may seek a place for purposes such as pleasure, business, or health. If a person's
intent be to remain, it becomes his domicile; if his intent is to leave as soon as his purpose
is established it is residence. It is thus, quite perfectly normal for an individual to have
different residences in various places. However, a person can only have asingle domicile,
unless, for various reasons, he successfully abandons his domicile in favor of another
domicile of choice. In Uytengsu vs. Republic, we laid this distinction quite clearly:

There is a difference between domicile and residence. "Residence" is used to indicate a

place of abode, whether permanent or temporary; "domicile" denotes a fixed permanent
residence to which, when absent, one has the intention of returning. A man may have a
residence in one place and a domicile in another. Residence is not domicile, but domicile is
residence coupled with the intention to remain for an unlimited time. A man can have but
one domicile for the same purpose at any time, but he may have numerous places of
residence. His place of residence is generally his place of domicile, but it is not by any
means necessarily so since no length of residence without intention of remaining will
constitute domicile.
1. YES. Imelda Romualdez-Marcos was a resident of the First District of Leyte for election
purposes, and therefore possessed the necessary residence qualifications to run in Leyte as
a candidate for a seat in the House of Representatives for the following reasons:

a. Minor follows the domicile of his parents. As domicile, once acquired is retained until a
new one is gained, it follows that in spite of the fact of petitioner's being born in
Manila, Tacloban, Leyte was her domicile of origin by operation of law. This domicile was
established when her father brought his family back to Leyte.

b. Domicile of origin is not easily lost. To successfully effect a change of domicile, one must
demonstrate:

1. An actual removal or an actual change of domicile;

2. A bona fide intention of abandoning the former place of residence and establishing a new
one; and
3. Acts which correspond with the purpose.

In the absence of clear and positive proof based on these criteria, the residence of origin
should be deemed to continue. Only with evidence showing concurrence of all three
requirements can the presumption of continuity or residence be rebutted, for a change of
residence requires an actual and deliberate abandonment, and one cannot have two legal
residences at the same time.

Petitioner held various residences for different purposes during the last four decades. None
of these purposes unequivocally point to an intention to abandon her domicile of origin
in Tacloban, Leyte.

c. It cannot be correctly argued that petitioner lost her domicile of origin by operation of law
as a result of her marriage to the late President Ferdinand E. Marcos in 1952.

[A wife does not automatically gain the husband’s domicile.] What petitioner gained upon
marriage was actual residence. She did not lose her domicile of origin. The term residence
may mean one thing in civil law (or under the Civil Code) and quite another thing in political
law. What stands clear is that insofar as the Civil Code is concerned-affecting the rights and
obligations of husband and wife — the term residence should only be interpreted to mean
"actual residence." The inescapable conclusion derived from this unambiguous civil law
delineation therefore, is that when petitioner married the former President in 1954, she kept
her domicile of origin and merely gained a new home, not a domicilium necessarium.
d. Even assuming for the sake of argument that petitioner gained a new "domicile" after her
marriage and only acquired a right to choose a new one after her husband died, petitioner's
acts following her return to the country clearly indicate that she not only impliedly but
expressly chose her domicile of origin (assuming this was lost by operation of law) as her
domicile. This "choice" was unequivocally expressed in her letters to the Chairman of the
PCGG when petitioner sought the PCGG's permission to "rehabilitate (our) ancestral house
in Tacloban and Farm in Olot, Leyte. . . to make them livable for the Marcos family to have
a home in our homeland." Furthermore, petitioner obtained her residence certificate in 1992
inTacloban, Leyte, while living in her brother's house, an act which supports the domiciliary
intention clearly manifested in her letters to the PCGG Chairman.

Effect of Disqualification Case

2. It is a settled doctrine that a statute requiring rendition of judgment within a specified

time is generally construed to be merely directory, "so that non-compliance with them does
not invalidate the judgment on the theory that if the statute had intended such result it
would have clearly indicated it." The difference between a mandatory and a
directory provision is often made on grounds of necessity.

In any event, with the enactment of Sections 6 and 7 of R.A. 6646 in relation to Section 78
of B.P. 881, it is evident that the respondent Commission does not lose jurisdiction to hear
and decide a pending disqualification case under Section 78 of B.P. 881 even after
the elections.

Section 6. Effect of Disqualification Case. - Any candidate who has been declared by
final judgment to be disqualified shall not be voted for, and the votes cast for him shall not
be counted. If for any reason a candidate is not declared by final judgment before an
election to be disqualified and he is voted for and receives the winning number of votes in
such election, theCourt or Commission shall continue with the trial and hearing of the
action, inquiry, or protest and, upon motion of the complainant or any intervenor, may
during the pendency thereof order the suspension of the proclamation of such candidate
whenever the evidence of his guilt is strong.

HRET Jurisdiction

3. HRET's jurisdiction as the sole judge of all contests relating to the elections, returns and
qualifications of members of Congress begins only after a candidate has become a member
of the House of Representatives. Petitioner not being a member of the House of
Representatives, it is obvious that the HRET at this point has no jurisdiction over the
question.

April 25, 1962

G.R. No. L-15080

IN THE MATTER OF THE ADOPTION OF THE MINOR NORMA LEE CABER, RICARDO R.
CARABALLO, petitioner-appellee,
vs.
REPUBLIC OF THE PHILIPPINES, opponent-appellant.

Clemente N. Dayrit for petitioner-appellee.

Office of the Solicitor General for opponent-appellant.
Padilla, J.:
NORMA LEE CABER. RICARDO R. CARABALLO vs. REPUBLIC OF THE PHILIPPINES

Republic of the PhilippinesSUPREME COURTManila

EN BANC

G.R. No. L-15080 &nbsp &nbsp &nbsp &nbsp &nbsp &nbsp April 25, 1962

IN THE MATTER OF THE ADOPTION OF THE MINOR NORMA LEE CABER, RICARDO R. CARABALLO,
petitioner-appellee,

vs.

REPUBLIC OF THE PHILIPPINES, opponent-appellant.

Clemente N. Dayrit for petitioner-appellee.

Office of the Solicitor General for opponent-appellant.

PADILLA, J.:

In a verified petition filed on 26 September 1958 in the Court of First Instance of Pampanga, Ricardo
R. Caraballo, an American citizen enlisted in the United States Air Force as staff sergeant detailed in
Clark Field, Angeles, Pampanga, where he and his wife Graciela G. Caraballo live, alleges that he and
his wife have no legitimate, legitimated, acknowledged natural children, natural children by legal
fiction or any other descendant; that with his wife’s written consent (Exhibit C) he desires to adopt as
his child Norma Lee Caber, a five-day old natural daughter of Mercedes J. Caber begotten by an
unknown father, who gave her consent to the adoption in a sworn statement (Exhibit B); that since
the day following her birth Norma Lee Caber has been reared and cared for by him and his wife who
have developed love and affection for her; that he never has been convicted of any crime involving
moral turpitude; that financially and morally he is able to support, bring up and educate the child; and
prays that after notice, publication and hearing Norma Lee Caber be declared his child for all intents
and purposes, free from any obligation of obedience and maintenance with respect to her natural
mother Mercedes J. Caber (Sp. Proc. No. 1391).

On 26 September 1958 the Court ordered the verified petition filed by Ricardo R. Caraballo to be
published and was published in the Daily Mirror once a week for three consecutive weeks setting the
petition for hearing on 18 October 1958 (Exhibit A). As at the hearing nobody appeared to object to
the petition for adoption, petitioner’s counsel prayed for an order of default, which was entered
against all interested parties, except the Solicitor General or Provincial Fiscal who, according to the
Court must appear in adoption cases.

On 27 October 1958 the Provincial and Assistant Provincial Fiscal of Pampanga moved for the
dismissal of the petition for adoption on the ground that it states no cause of action and that the
petitioner, being a non-resident alien, is not qualified to adopt.

On 28 October 1958 the Court granted the petitioner ten days within which to file an answer to the
motion to dismiss and submit a memorandum of authorities, and the fiscal the same number of days
to reply.

On 3 November 1958 the petitioner filed an answer or objection to the motion to dismiss, to which on
14 November the Provincial Fiscal replied.

On 17 November 1958 the Court denied the motion to dismiss.

On 12 December 1958 the petitioner moved that the case be set for hearing. On 15 December 1958
the Court set the petition for hearing on 22 December 1958 at 9:00 o’clock in the morning.

After hearing, the Court found the following:

… Petitioner is 32 years old while the child sought to be adopted is three months old, having been born
on September 20, 1958 (Exhibit E). The petitioner has been residing at Clark Air Base for the last 25
months. He has had the child, Norma Lee Caber, in his household as a daughter since the day
following that of her birth and has developed a fondness for her and intends to bring her up and
educate her as his own to the best of his ability. He has never had any children, either with his wife,
Graciela G. Caraballo, with whom he has been married for 12 years, or with any other woman.

He is a staff sergeant in the United States Air Force and receives approximately $465.00 a month,
including allowances. He expects to retire as a master sergeant after 6 years and 3 months, and as
such, he would receive a monthly pension of about $175.00 to $190.00 for the rest of his life. He has
an allotment check made out to a bank for $84.00 a month. He has two insurance policies with an
aggregate value of P15,000.00 and has a savings of $6,000.00 to $7,000.00 which he has been
accumulating for the last 15 to 20 years. After retirement, he intends to settle down permanently in
the Philippines where he will engage in the tourist business by putting up a hotel.
It also appears that petitioner has never been convicted of any crime whatsoever and rendered a
decree as follows: .

PREMISES CONSIDERED, the Court believes that it would be to the best interest of the child to be
placed under the care and custody of petitioner who is materially and morally able to educate and
bring her up properly and adequately, and, therefore, adjudges that henceforth Norma Lee Caber shall
be, for all legitimate intents and purposes, the child of Ricardo R. Caraballo and shall be freed from all
legal obligations of obedience and maintenance with respect to her natural mother, Mercedes Caber,
and that her surname shall be changed to that of petitioner, and pursuant to Article 346 of the Civil
Code of the Philippines, this decision shall be recorded in the local civil registry of Angeles, Pampanga,
and the name and surname of the said minor shall thereafter be Norma Lee Caraballo.

xxxxxxxxx

The point to determine is whether under the law the petitioner is a person qualified to adopt. The
Government contends that he is not, invoking the provisions of article 335 of the Civil Code. The
article provides: .

The following cannot adopt -

(1) Those who have legitimate, legitimated, acknowledged natural children, or natural children by
legal fiction;

(2) The guardian, with respect to the ward, before the final approval of his accounts;

(3) A married person, without the consent of the other spouse;

(4) Non-resident aliens;

(5) Resident aliens with whose government the Republic of the Philippines has broken diplomatic
relations;

(6) Any person who has been convicted of a crime involving moral turpitude, when the penalty
imposed was six months’ imprisonment or more.

A person is deemed a resident of a place in a country or state where he has his abode and lives there
permanently. It is a place chosen by him freely and voluntarily, although he may later on change his
mind and live elsewhere. A place in a country or state where he lives and stays permanently and to
which he intends to return after a temporary absence, no matter how long, is his domicile. A sojourn
such as a tourist though actually present at a place of his free choice cannot be deemed a resident of
that place. A foreigner who has a business or interest therein or property located in a country or state
and goes and stays in that country or state to look after his business or property or to check up the
manner or way his business or property is being conducted or run by his manager but does not intend
to remain in the country indefinitely cannot be deemed a resident of such country. Actual or physical
presence or stay of a person in a place, not of his free and voluntary choice and without intent to
remain there indefinitely, does not make him a resident of the place. Looking after the welfare of a
minor to be adopted the law has surrounded him with safeguards to achieve and insure such welfare.
It cannot be gainsaid that an adopted minor may be removed from the country by the adopter, who is
not a resident of the Philippines, and placed beyond the reach and protection of the country of his
birth.

Ricardo R. Caraballo, the petitioner, an American citizen who now lives in Clark Field, municipality of
Angeles, province of Pampanga, Republic of the Philippines, because of his assignment as staff
sergeant in the United States Air Force – his stay in the Philippines then being temporary – is a non-
resident alien who, pursuant to clause 4 of the above quoted article of the Civil Code, is disqualified to
adopt a child in the Philippines.

The decree appealed from is set aside and the petition dismissed, without pronouncement as to costs.

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

Concepcion, J., concurs in the result.

Barrera, J., took no part.

G.R. No. L-19671 November 29, 1965

PASTOR B. TENCHAVEZ, plaintiff-appellant,

vs.
VICENTA F. ESCAÑO, ET AL., defendants-appellees.

I. V. Binamira & F. B. Barria for plaintiff-appellant.

Jalandoni & Jarnir for defendants-appellees.

REYES, J.B.L., J.:

Direct appeal, on factual and legal questions, from the judgment of the Court of First Instance of
Cebu, in its Civil Case No. R-4177, denying the claim of the plaintiff-appellant, Pastor B. Tenchavez,
for legal separation and one million pesos in damages against his wife and parents-in-law, the
defendants-appellees, Vicente, Mamerto and Mena,1 all surnamed "Escaño," respectively. 2

The facts, supported by the evidence of record, are the following:

Missing her late afternoon classes on 24 February 1948 in the University of San Carlos, Cebu City,
where she was then enrolled as a second year student of commerce, Vicenta Escaño, 27 years of
age (scion of a well-to-do and socially prominent Filipino family of Spanish ancestry and a "sheltered
colegiala"), exchanged marriage vows with Pastor Tenchavez, 32 years of age, an engineer, ex-
army officer and of undistinguished stock, without the knowledge of her parents, before a Catholic
chaplain, Lt. Moises Lavares, in the house of one Juan Alburo in the said city. The marriage was the
culmination of a previous love affair and was duly registered with the local civil register.
Vicenta's letters to Pastor, and his to her, before the marriage, indicate that the couple were deeply
in love. Together with a friend, Pacita Noel, their matchmaker and go-between, they had planned out
their marital future whereby Pacita would be the governess of their first-born; they started saving
money in a piggy bank. A few weeks before their secret marriage, their engagement was broken;
Vicenta returned the engagement ring and accepted another suitor, Joseling Lao. Her love for Pastor
beckoned; she pleaded for his return, and they reconciled. This time they planned to get married and
then elope. To facilitate the elopement, Vicenta had brought some of her clothes to the room of
Pacita Noel in St. Mary's Hall, which was their usual trysting place.

Although planned for the midnight following their marriage, the elopement did not, however,
materialize because when Vicente went back to her classes after the marriage, her mother, who got
wind of the intended nuptials, was already waiting for her at the college. Vicenta was taken home
where she admitted that she had already married Pastor. Mamerto and Mena Escaño were
surprised, because Pastor never asked for the hand of Vicente, and were disgusted because of the
great scandal that the clandestine marriage would provoke (t.s.n., vol. III, pp. 1105-06). The
following morning, the Escaño spouses sought priestly advice. Father Reynes suggested a
recelebration to validate what he believed to be an invalid marriage, from the standpoint of the
Church, due to the lack of authority from the Archbishop or the parish priest for the officiating
chaplain to celebrate the marriage. The recelebration did not take place, because on 26 February
1948 Mamerto Escaño was handed by a maid, whose name he claims he does not remember, a
letter purportedly coming from San Carlos college students and disclosing an amorous relationship
between Pastor Tenchavez and Pacita Noel; Vicenta translated the letter to her father, and
thereafter would not agree to a new marriage. Vicenta and Pastor met that day in the house of Mrs.
Pilar Mendezona. Thereafter, Vicenta continued living with her parents while Pastor returned to his
job in Manila. Her letter of 22 March 1948 (Exh. "M"), while still solicitous of her husband's welfare,
was not as endearing as her previous letters when their love was aflame.

Vicenta was bred in Catholic ways but is of a changeable disposition, and Pastor knew it. She fondly
accepted her being called a "jellyfish." She was not prevented by her parents from communicating
with Pastor (Exh. "1-Escaño"), but her letters became less frequent as the days passed. As of June,
1948 the newlyweds were already estranged (Exh. "2-Escaño"). Vicenta had gone to Jimenez,
Misamis Occidental, to escape from the scandal that her marriage stirred in Cebu society. There, a
lawyer filed for her a petition, drafted by then Senator Emmanuel Pelaez, to annul her marriage. She
did not sign the petition (Exh. "B-5"). The case was dismissed without prejudice because of her non-
appearance at the hearing (Exh. "B-4").

On 24 June 1950, without informing her husband, she applied for a passport, indicating in her
application that she was single, that her purpose was to study, and she was domiciled in Cebu City,
and that she intended to return after two years. The application was approved, and she left for the
United States. On 22 August 1950, she filed a verified complaint for divorce against the herein
plaintiff in the Second Judicial District Court of the State of Nevada in and for the County of Washoe,
on the ground of "extreme cruelty, entirely mental in character." On 21 October 1950, a decree of
divorce, "final and absolute", was issued in open court by the said tribunal.

In 1951 Mamerto and Mena Escaño filed a petition with the Archbishop of Cebu to annul their
daughter's marriage to Pastor (Exh. "D"). On 10 September 1954, Vicenta sought papal dispensation
of her marriage (Exh. "D"-2).

On 13 September 1954, Vicenta married an American, Russell Leo Moran, in Nevada. She now lives
with him in California, and, by him, has begotten children. She acquired American citizenship on 8
August 1958.
But on 30 July 1955, Tenchavez had initiated the proceedings at bar by a complaint in the Court of
First Instance of Cebu, and amended on 31 May 1956, against Vicenta F. Escaño, her parents,
Mamerto and Mena Escaño, whom he charged with having dissuaded and discouraged Vicenta from
joining her husband, and alienating her affections, and against the Roman Catholic Church, for
having, through its Diocesan Tribunal, decreed the annulment of the marriage, and asked for legal
separation and one million pesos in damages. Vicenta claimed a valid divorce from plaintiff and an
equally valid marriage to her present husband, Russell Leo Moran; while her parents denied that
they had in any way influenced their daughter's acts, and counterclaimed for moral damages.

The appealed judgment did not decree a legal separation, but freed the plaintiff from supporting his
wife and to acquire property to the exclusion of his wife. It allowed the counterclaim of Mamerto
Escaño and Mena Escaño for moral and exemplary damages and attorney's fees against the
plaintiff-appellant, to the extent of P45,000.00, and plaintiff resorted directly to this Court.

The appellant ascribes, as errors of the trial court, the following:

1. In not declaring legal separation; in not holding defendant Vicenta F. Escaño liable for
damages and in dismissing the complaint;.

2. In not holding the defendant parents Mamerto Escano and the heirs of Doña Mena
Escaño liable for damages;.

3 In holding the plaintiff liable for and requiring him to pay the damages to the defendant
parents on their counterclaims; and.

4. In dismissing the complaint and in denying the relief sought by the plaintiff.

That on 24 February 1948 the plaintiff-appellant, Pastor Tenchavez, and the defendant-appellee,
Vicenta Escaño, were validly married to each other, from the standpoint of our civil law, is clearly
established by the record before us. Both parties were then above the age of majority, and otherwise
qualified; and both consented to the marriage, which was performed by a Catholic priest (army
chaplain Lavares) in the presence of competent witnesses. It is nowhere shown that said priest was
not duly authorized under civil law to solemnize marriages.

The chaplain's alleged lack of ecclesiastical authorization from the parish priest and the Ordinary, as
required by Canon law, is irrelevant in our civil law, not only because of the separation of Church
and State but also because Act 3613 of the Philippine Legislature (which was the marriage law in
force at the time) expressly provided that —

SEC. 1. Essential requisites. Essential requisites for marriage are the legal capacity of the
contracting parties and consent. (Emphasis supplied)

The actual authority of the solemnizing officer was thus only a formal requirement, and, therefore,
not essential to give the marriage civil effects,3 and this is emphasized by section 27 of said marriage
act, which provided the following:

SEC. 27. Failure to comply with formal requirements. No marriage shall be declared invalid
because of the absence of one or several of the formal requirements of this Act if, when it
was performed, the spouses or one of them believed in good faith that the person who
solemnized the marriage was actually empowered to do so, and that the marriage was
perfectly legal.
The good faith of all the parties to the marriage (and hence the validity of their marriage) will be
presumed until the contrary is positively proved (Lao vs. Dee Tim, 45 Phil. 739, 745; Francisco vs.
Jason, 60 Phil. 442, 448). It is well to note here that in the case at bar, doubts as to the authority of
the solemnizing priest arose only after the marriage, when Vicenta's parents consulted Father
Reynes and the archbishop of Cebu. Moreover, the very act of Vicenta in abandoning her original
action for annulment and subsequently suing for divorce implies an admission that her marriage to
plaintiff was valid and binding.

Defendant Vicenta Escaño argues that when she contracted the marriage she was under the undue
influence of Pacita Noel, whom she charges to have been in conspiracy with appellant Tenchavez.
Even granting, for argument's sake, the truth of that contention, and assuming that Vicenta's consent
was vitiated by fraud and undue influence, such vices did not render her marriage ab initio void, but
merely voidable, and the marriage remained valid until annulled by a competent civil court. This was
never done, and admittedly, Vicenta's suit for annulment in the Court of First Instance of Misamis
was dismissed for non-prosecution.

It is equally clear from the record that the valid marriage between Pastor Tenchavez and Vicenta
Escaño remained subsisting and undissolved under Philippine law, notwithstanding the decree of
absolute divorce that the wife sought and obtained on 21 October 1950 from the Second Judicial
District Court of Washoe County, State of Nevada, on grounds of "extreme cruelty, entirely mental in
character." At the time the divorce decree was issued, Vicenta Escaño, like her husband, was still a
Filipino citizen.4 She was then subject to Philippine law, and Article 15 of the Civil Code of the
Philippines (Rep. Act No. 386), already in force at the time, expressly provided:

Laws relating to family rights and duties or to the status, condition and legal capacity of
persons are binding upon the citizens of the Philippines, even though living abroad.

The Civil Code of the Philippines, now in force, does not admit absolute divorce, quo ad vinculo
matrimonii; and in fact does not even use that term, to further emphasize its restrictive policy on the
matter, in contrast to the preceding legislation that admitted absolute divorce on grounds of adultery
of the wife or concubinage of the husband (Act 2710). Instead of divorce, the present Civil Code only
provides for legal separation (Title IV, Book 1, Arts. 97 to 108), and, even in that case, it expressly
prescribes that "the marriage bonds shall not be severed" (Art. 106, subpar. 1).

For the Philippine courts to recognize and give recognition or effect to a foreign decree of absolute
divorce betiveen Filipino citizens could be a patent violation of the declared public policy of the state,
specially in view of the third paragraph of Article 17 of the Civil Code that prescribes the following:

Prohibitive laws concerning persons, their acts or property, and those which have for their
object public order, policy and good customs, shall not be rendered ineffective by laws or
judgments promulgated, or by determinations or conventions agreed upon in a foreign
country.

Even more, the grant of effectivity in this jurisdiction to such foreign divorce decrees would, in effect,
give rise to an irritating and scandalous discrimination in favor of wealthy citizens, to the detriment of
those members of our polity whose means do not permit them to sojourn abroad and obtain absolute
divorces outside the Philippines.

From this point of view, it is irrelevant that appellant Pastor Tenchavez should have appeared in the
Nevada divorce court. Primarily because the policy of our law cannot be nullified by acts of private
parties (Civil Code,Art. 17, jam quot.); and additionally, because the mere appearance of a non-
resident consort cannot confer jurisdiction where the court originally had none (Area vs. Javier, 95
Phil. 579).

From the preceding facts and considerations, there flows as a necessary consequence that in this
jurisdiction Vicenta Escaño's divorce and second marriage are not entitled to recognition as valid; for
her previous union to plaintiff Tenchavez must be declared to be existent and undissolved. It follows,
likewise, that her refusal to perform her wifely duties, and her denial of consortium and her desertion
of her husband constitute in law a wrong caused through her fault, for which the husband is entitled
to the corresponding indemnity (Civil Code, Art. 2176). Neither an unsubstantiated charge of deceit
nor an anonymous letter charging immorality against the husband constitute, contrary to her claim,
adequate excuse. Wherefore, her marriage and cohabitation with Russell Leo Moran is technically
"intercourse with a person not her husband" from the standpoint of Philippine Law, and entitles
plaintiff-appellant Tenchavez to a decree of "legal separation under our law, on the basis of adultery"
(Revised Penal Code, Art. 333).

The foregoing conclusions as to the untoward effect of a marriage after an invalid divorce are in
accord with the previous doctrines and rulings of this court on the subject, particularly those that
were rendered under our laws prior to the approval of the absolute divorce act (Act 2710 of the
Philippine Legislature). As a matter of legal history, our statutes did not recognize divorces a
vinculo before 1917, when Act 2710 became effective; and the present Civil Code of the Philippines,
in disregarding absolute divorces, in effect merely reverted to the policies on the subject prevailing
before Act 2710. The rulings, therefore, under the Civil Code of 1889, prior to the Act above-
mentioned, are now, fully applicable. Of these, the decision in Ramirez vs. Gmur, 42 Phil. 855, is of
particular interest. Said this Court in that case:

As the divorce granted by the French Court must be ignored, it results that the marriage of
Dr. Mory and Leona Castro, celebrated in London in 1905, could not legalize their relations;
and the circumstance that they afterwards passed for husband and wife in Switzerland until
her death is wholly without legal significance. The claims of the very children to participate in
the estate of Samuel Bishop must therefore be rejected. The right to inherit is limited to
legitimate, legitimated and acknowledged natural children. The children of adulterous
relations are wholly excluded. The word "descendants" as used in Article 941 of the Civil
Code cannot be interpreted to include illegitimates born of adulterous relations. (Emphasis
supplied)

Except for the fact that the successional rights of the children, begotten from Vicenta's marriage to
Leo Moran after the invalid divorce, are not involved in the case at bar, the Gmur case is authority
for the proposition that such union is adulterous in this jurisdiction, and, therefore, justifies an action
for legal separation on the part of the innocent consort of the first marriage, that stands undissolved
in Philippine law. In not so declaring, the trial court committed error.

True it is that our ruling gives rise to anomalous situations where the status of a person (whether
divorced or not) would depend on the territory where the question arises. Anomalies of this kind are
not new in the Philippines, and the answer to them was given in Barretto vs. Gonzales, 58 Phil. 667:

The hardship of the existing divorce laws in the Philippine Islands are well known to the
members of the Legislature. It is the duty of the Courts to enforce the laws of divorce as
written by Legislature if they are constitutional. Courts have no right to say that such laws are
too strict or too liberal. (p. 72)

The appellant's first assignment of error is, therefore, sustained.

However, the plaintiff-appellant's charge that his wife's parents, Dr. Mamerto Escaño and his wife,
the late Doña Mena Escaño, alienated the affections of their daughter and influenced her conduct
toward her husband are not supported by credible evidence. The testimony of Pastor Tenchavez
about the Escaño's animosity toward him strikes us to be merely conjecture and exaggeration, and
are belied by Pastor's own letters written before this suit was begun (Exh. "2-Escaño" and "Vicenta,"
Rec. on App., pp. 270-274). In these letters he expressly apologized to the defendants for
"misjudging them" and for the "great unhappiness" caused by his "impulsive blunders" and "sinful
pride," "effrontery and audacity" [sic]. Plaintiff was admitted to the Escaño house to visit and court
Vicenta, and the record shows nothing to prove that he would not have been accepted to marry
Vicente had he openly asked for her hand, as good manners and breeding demanded. Even after
learning of the clandestine marriage, and despite their shock at such unexpected event, the parents
of Vicenta proposed and arranged that the marriage be recelebrated in strict conformity with the
canons of their religion upon advice that the previous one was canonically defective. If no
recelebration of the marriage ceremony was had it was not due to defendants Mamerto Escaño and
his wife, but to the refusal of Vicenta to proceed with it. That the spouses Escaño did not seek to
compel or induce their daughter to assent to the recelebration but respected her decision, or that
they abided by her resolve, does not constitute in law an alienation of affections. Neither does the
fact that Vicenta's parents sent her money while she was in the United States; for it was natural that
they should not wish their daughter to live in penury even if they did not concur in her decision to
divorce Tenchavez (27 Am. Jur. 130-132).

There is no evidence that the parents of Vicenta, out of improper motives, aided and abetted her
original suit for annulment, or her subsequent divorce; she appears to have acted independently,
and being of age, she was entitled to judge what was best for her and ask that her decisions be
respected. Her parents, in so doing, certainly cannot be charged with alienation of affections in the
absence of malice or unworthy motives, which have not been shown, good faith being always
presumed until the contrary is proved.

SEC. 529. Liability of Parents, Guardians or Kin. — The law distinguishes between the right
of a parent to interest himself in the marital affairs of his child and the absence of rights in a
stranger to intermeddle in such affairs. However, such distinction between the liability of
parents and that of strangers is only in regard to what will justify interference. A parent
isliable for alienation of affections resulting from his own malicious conduct, as where he
wrongfully entices his son or daughter to leave his or her spouse, but he is not liable unless
he acts maliciously, without justification and from unworthy motives. He is not liable where
he acts and advises his child in good faith with respect to his child's marital relations in the
interest of his child as he sees it, the marriage of his child not terminating his right and liberty
to interest himself in, and be extremely solicitous for, his child's welfare and happiness, even
where his conduct and advice suggest or result in the separation of the spouses or the
obtaining of a divorce or annulment, or where he acts under mistake or misinformation, or
where his advice or interference are indiscreet or unfortunate, although it has been held that
the parent is liable for consequences resulting from recklessness. He may in good faith take
his child into his home and afford him or her protection and support, so long as he has not
maliciously enticed his child away, or does not maliciously entice or cause him or her to stay
away, from his or her spouse. This rule has more frequently been applied in the case of
advice given to a married daughter, but it is equally applicable in the case of advice given to
a son.

Plaintiff Tenchavez, in falsely charging Vicenta's aged parents with racial or social discrimination and
with having exerted efforts and pressured her to seek annulment and divorce, unquestionably
caused them unrest and anxiety, entitling them to recover damages. While this suit may not have
been impelled by actual malice, the charges were certainly reckless in the face of the proven facts
and circumstances. Court actions are not established for parties to give vent to their prejudices or
spleen.

In the assessment of the moral damages recoverable by appellant Pastor Tenchavez from
defendant Vicente Escaño, it is proper to take into account, against his patently unreasonable claim
for a million pesos in damages, that (a) the marriage was celebrated in secret, and its failure was not
characterized by publicity or undue humiliation on appellant's part; (b) that the parties never lived
together; and (c) that there is evidence that appellant had originally agreed to the annulment of the
marriage, although such a promise was legally invalid, being against public policy (cf. Art. 88, Civ.
Code). While appellant is unable to remarry under our law, this fact is a consequence of the
indissoluble character of the union that appellant entered into voluntarily and with open eyes rather
than of her divorce and her second marriage. All told, we are of the opinion that appellant should
recover P25,000 only by way of moral damages and attorney's fees.

With regard to the P45,000 damages awarded to the defendants, Dr. Mamerto Escaño and Mena
Escaño, by the court below, we opine that the same are excessive. While the filing of this unfounded
suit must have wounded said defendants' feelings and caused them anxiety, the same could in no
way have seriously injured their reputation, or otherwise prejudiced them, lawsuits having become a
common occurrence in present society. What is important, and has been correctly established in the
decision of the court below, is that said defendants were not guilty of any improper conduct in the
whole deplorable affair. This Court, therefore, reduces the damages awarded to P5,000 only.

Summing up, the Court rules:

(1) That a foreign divorce between Filipino citizens, sought and decreed after the effectivity of the
present Civil Code (Rep. Act 386), is not entitled to recognition as valid in this jurisdiction; and
neither is the marriage contracted with another party by the divorced consort, subsequently to the
foreign decree of divorce, entitled to validity in the country;

(2) That the remarriage of divorced wife and her co-habitation with a person other than the lawful
husband entitle the latter to a decree of legal separation conformably to Philippine law;

(3) That the desertion and securing of an invalid divorce decree by one consort entitles the other to
recover damages;

(4) That an action for alienation of affections against the parents of one consort does not lie in the
absence of proof of malice or unworthy motives on their part.

WHEREFORE, the decision under appeal is hereby modified as follows;

(1) Adjudging plaintiff-appellant Pastor Tenchavez entitled to a decree of legal separation from
defendant Vicenta F. Escaño;

(2) Sentencing defendant-appellee Vicenta Escaño to pay plaintiff-appellant Tenchavez the amount
of P25,000 for damages and attorneys' fees;

(3) Sentencing appellant Pastor Tenchavez to pay the appellee, Mamerto Escaño and the estate of
his wife, the deceased Mena Escaño, P5,000 by way of damages and attorneys' fees.

Neither party to recover costs.

Bengzon, C.J., Bautista Angelo, Concepcion, Dizon, Regala, Makalintal, Bengzon, J.P. and Zaldivar,
JJ., concur.

G.R. No. 74833 January 21, 1991

THOMAS C. CHEESMAN, petitioner,

vs.
INTERMEDIATE APPELLATE COURT and ESTELITA PADILLA, respondents.

Estanislao L. Cesa, Jr. for petitioner.

Benjamin I. Fernandez for private respondent.

NARVASA, J.:p

This appeal concerns the attempt by an American citizen (petitioner Thomas Cheesman) to annul —
for lack of consent on his part — the sale by his Filipino wife (Criselda) of a residential lot and
building to Estelita Padilla, also a Filipino.

Thomas Cheesman and Criselda P. Cheesman were married on December 4, 1970 but have been
separated since February 15,1981. 1

On June 4, 1974, a "Deed of Sale and Transfer of Possessory Rights" was executed by Armando
Altares conveying a parcel of unregistered land and the house thereon (at No. 7 Neptune Street,
Gordon Heights, Olongapo City) in favor of "Criselda P. Cheesman, of legal age, Filipino citizen,
married to Thomas Cheesman, and residing at Lot No. 1, Blk. 8, Filtration Road, Sta. Rita, Olongapo
City . . ." 2 Thomas Cheesman, although aware of the deed, did not object to the transfer being made
only to his wife. 3

Thereafter—and again with the knowledge of Thomas Cheesman and also without any protest by
him—tax declarations for the property purchased were issued in the name only of Criselda
Cheesman and Criselda assumed exclusive management and administration of said property,
leasing it to tenants. 4 On July 1, 1981, Criselda Cheesman sold the property to Estelita M. Padilla,
without the knowledge or consent of Thomas Cheesman. 5 The deed described Criselda as being" . .
. of legal age, married to an American citizen,. . ." 6

Thirty days later, or on July 31, 1981, Thomas Cheesman brought suit in the Court of First Instance
at Olongapo City against his wife, Criselda, and Estelita Padilla, praying for the annulment of the
sale on the ground that the transaction had been executed without his knowledge and consent. 7 An
answer was filed in the names of both defendants, alleging that (1) the property sold was
paraphernal, having been purchased by Criselda with funds exclusively belonging to her ("her own
separate money"); (2) Thomas Cheesman, being an American, was disqualified to have any interest
or right of ownership in the land; and (3) Estelita Padilla was a buyer in good faith. 8
During the pre-trial conference, the parties agreed upon certain facts which were subsequently set
out in a pre-trial Order dated October 22, 1981, 9 as follows:

1. Both parties recognize the existence of the Deed of Sale over the residential
house located at No. 7 Granada St., Gordon Heights, Olongapo City, which was
acquired from Armando Altares on June 4, 1974 and sold by defendant Criselda
Cheesman to Estelita Padilla on July 12, 1981; and

2. That the transaction regarding the transfer of their property took place during the
existence of their marriage as the couple were married on December 4, 1970 and the
questioned property was acquired sometime on June 4,1974.

The action resulted in a judgment dated June 24, 1982, 10 declaring void ab initio the sale executed
by Criselda Cheesman in favor of Estelita M. Padilla, and ordering the delivery of the property to
Thomas Cheesman as administrator of the conjugal partnership property, and the payment to him of
P5,000.00 as attorney's fees and expenses of litigation. 11

The judgment was however set aside as regards Estelita Padilla on a petition for relief filed by the
latter, grounded on "fraud, mistake and/or excusable negligence" which had seriously impaired her
right to present her case adequately. 12 "After the petition for relief from judgment was given due
course," according to petitioner, "a new judge presided over the case." 13

Estelita Padilla filed a supplemental pleading on December 20, 1982 as her own answer to the
complaint, and a motion for summary judgment on May 17, 1983. Although there was initial
opposition by Thomas Cheesman to the motion, the parties ultimately agreed on the rendition by the
court of a summary judgment after entering into a stipulation of facts, at the hearing of the motion on
June 21, 1983, the stipulation being of the following tenor: 14

(1) that the property in question was bought during the existence of the marriage
between the plaintiff and the defendant Criselda P. Cheesman;

(2) that the property bought during the marriage was registered in the name of
Criselda Cheesman and that the Deed of Sale and Transfer of Possessory Rights
executed by the former owner-vendor Armando Altares in favor of Criselda
Cheesman made no mention of the plaintiff;

(3) that the property, subject of the proceedings, was sold by defendant Criselda
Cheesman in favor of the other defendant Estelita M. Padilla, without the written
consent of the plaintiff.

Obviously upon the theory that no genuine issue existed any longer and there was hence no need of
a trial, the parties having in fact submitted, as also stipulated, their respective memoranda each
praying for a favorable verdict, the Trial Court 15 rendered a "Summary Judgment" dated August 3,
1982 declaring "the sale executed by . . . Criselda Cheesman in favor of . . . Estelita Padilla to be
valid," dismissing Thomas Cheesman's complaint and ordering him "to immediately turn over the
possession of the house and lot subject of . . . (the) case to . . . Estelita Padilla . . ." 16

The Trial Court found that —

1) the evidence on record satisfactorily overcame the disputable presumption in

Article 160 of the Civil Code—that all property of the marriage belongs to the
 conjugal partnership "unless it be proved that it pertains exclusively to the husband
or to the wife"—and that the immovable in question was in truth Criselda's
paraphernal property;

2) that moreover, said legal presumption in Article 160 could not apply "inasmuch as
the husband-plaintiff is an American citizen and therefore disqualified under the
Constitution to acquire and own real properties; and

3) that the exercise by Criselda of exclusive acts of dominion with the knowledge of
her husband "had led . . . Estelita Padilla to believe that the properties were the
exclusive properties of Criselda Cheesman and on the faith of such a belief she
bought the properties from her and for value," and therefore, Thomas Cheesman
was, under Article 1473 of the Civil Code, estopped to impugn the transfer to Estelita
Padilla.

Thomas Cheesman appealed to the Intermediate Appellate Court. There he assailed the Trial Court
acts (1) of granting Estelita Padilla's petition for relief, and its resolution of matters not subject of said
petition; (2) of declaring valid the sale to Estelita Padilla despite the lack of consent thereto by him,
and the presumption of the conjugal character of the property in question pursuant to Article 160 of
the Civil Code; (3) of disregarding the judgment of June 24, 1982 which, not having been set aside
as against Criselda Cheesman, continued to be binding on her; and (4) of making findings of fact not
supported by evidence. All of these contentions were found to be without merit by the Appellate
Tribunal which, on January 7, 1986, promulgated a decision (erroneously denominated,
"Report") 17 affirming the "Summary Judgment complained of," "having found no reversible error"
therein.

Once more, Thomas Cheesman availed of the remedy of appeal, this time to this Court. Here, he
argues that it was reversible error for the Intermediate Appellate Court —

1) to find that the presumption that the property in question is conjugal in accordance with Article 160
had been satisfactorily overcome by Estelita Padilla; 18

2) to rule that Estelita Padilla was a purchaser of said property in good faith, it appearing:

a) that the deed by which the property was conveyed to Criselda Cheesman
described her as "married to Thomas C. Cheesman," as well as the deed by which
the property was later conveyed to Estelita Padilla by Criselda Cheesman also
described her as "married to an American citizen," and both said descriptions had
thus "placed Estelita on knowledge of the conjugal nature of the property;" and

b) that furthermore, Estelita had admitted to stating in the deed by which she
acquired the property a price much lower than that actually paid "in order to avoid
payment of more obligation to the government;" 19

3) to decline to declare that the evidence did not warrant the grant of Estelita Padilla's petition for
relief on the ground of "fraud, mistake and/or excusable negligence;" 20

4) to hold that Thomas Cheesman had waived his objection to Estelita's petition for relief by failing to
appeal from the order granting the same;
5) to accord to Estelita Padilla a relief other than that she had specifically prayed for in her petition
for relief, ie., "the restoration of the purchase price which Estelita allegedly paid to Criselda;" 21 and

6) to fail to declare that Thomas Cheesman's citizenship is not a bar to his action to recover the lot
and house for the conjugal partnership. 22

Such conclusions as that (1) fraud, mistake or excusable negligence existed in the premises
justifying relief to Estelita Padilla under Rule 38 of the Rules of Court, or (2) that Criselda Cheesman
had used money she had brought into her marriage to Thomas Cheesman to purchase the lot and
house in question, or (3) that Estelita Padilla believed in good faith that Criselda Cheesman was the
exclusive owner of the property that she (Estelita) intended to and did in fact buy—derived from the
evidence adduced by the parties, the facts set out in the pleadings or otherwise appearing on record
—are conclusions or findings of fact. As distinguished from a question of law—which exists "when
the doubt or difference arises as to what the law is on a certain state of facts" — "there is a question
of fact when the doubt or difference arises as to the truth or the falsehood of alleged facts;" 23 or
when the "query necessarily invites calibration of the whole evidence considering mainly the
credibility of witnesses, existence and relevancy of specific surrounding circumstances, their relation;
to each other and to the whole and the probabilities of the situation." 24

Now, it is axiomatic that only questions of law, distinctly set forth, may be raised in a petition for the
review oncertiorari of a decision of the Court of Appeals presented to this Court. 25 As everyone
knows or ought to know, the appellate jurisdiction of this Court is limited to reviewing errors of law,
accepting as conclusive the factual findings of the lower court upon its own assessment of the
evidence. 26 The creation of the Court of Appeals was precisely intended to take away from the
Supreme Court the work of examining the evidence, and confine its task to the determination of
questions which do not call for the reading and study of transcripts containing the testimony of
witnesses. 27 The rule of conclusiveness of the factual findings or conclusions of the Court of Appeals
is, to be sure, subject to certain exceptions, 28 none of which however obtains in the case at bar.

It is noteworthy that both the Trial Court and the Intermediate Appellate Court reached the same
conclusions on the three (3) factual matters above set forth, after assessment of the evidence and
determination of the probative value thereof. Both Courts found that the facts on record adequately
proved fraud, mistake or excusable negligence by which Estelita Padilla's rights had been
substantially impaired; that the funds used by Criselda Cheesman was money she had earned and
saved prior to her marriage to Thomas Cheesman, and that Estelita Padilla did believe in good faith
that Criselda Cheesman was the sole owner of the property in question. Consequently, these
determinations of fact will not be here disturbed, this Court having been cited to no reason for doing
so.

These considerations dispose of the first three (3) points that petitioner Cheesman seeks to make in
his appeal. They also make unnecessary an extended discussion of the other issues raised by him.
As to them, it should suffice to restate certain fundamental propositions.

An order of a Court of First Instance (now Regional Trial Court) granting a petition for relief under
Rule 38 is interlocutory and is not appealable. Hence, the failure of the party who opposed the
petition to appeal from said order, or his participation in the proceedings subsequently had, cannot
be construed as a waiver of his objection to the petition for relief so as to preclude his raising the
same question on appeal from the judgment on the merits of the main case. Such a party need not
repeat his objections to the petition for relief, or perform any act thereafter (e.g., take formal
exception) in order to preserve his right to question the same eventually, on appeal, it being
sufficient for this purpose that he has made of record "the action which he desires the court to take
or his objection to the action of the court and his grounds therefor." 29
Again, the prayer in a petition for relief from judgment under Rule 38 is not necessarily the same
prayer in the petitioner's complaint, answer or other basic pleading. This should be obvious. Equally
obvious is that once a petition for relief is granted and the judgment subject thereof set aside, and
further proceedings are thereafter had, the Court in its judgment on the merits may properly grant
the relief sought in the petitioner's basic pleadings, although different from that stated in his petition
for relief.

Finally, the fundamental law prohibits the sale to aliens of residential land. Section 14, Article XIV of
the 1973 Constitution ordains that, "Save in cases of hereditary succession, no private land shall be
transferred or conveyed except to individuals, corporations, or associations qualified to acquire or
hold lands of the public domain." 30 Petitioner Thomas Cheesman was, of course, charged with
knowledge of this prohibition. Thus, assuming that it was his intention that the lot in question be
purchased by him and his wife, he acquired no right whatever over the property by virtue of that
purchase; and in attempting to acquire a right or interest in land, vicariously and clandestinely, he
knowingly violated the Constitution; the sale as to him was null and void. 31 In any event, he had and
has no capacity or personality to question the subsequent sale of the same property by his wife on
the theory that in so doing he is merely exercising the prerogative of a husband in respect of
conjugal property. To sustain such a theory would permit indirect controversion of the constitutional
prohibition. If the property were to be declared conjugal, this would accord to the alien husband a not
insubstantial interest and right over land, as he would then have a decisive vote as to its transfer or
disposition. This is a right that the Constitution does not permit him to have.

As already observed, the finding that his wife had used her own money to purchase the property
cannot, and will not, at this stage of the proceedings be reviewed and overturned. But even if it were
a fact that said wife had used conjugal funds to make the acquisition, the considerations just set out
militate, on high constitutional grounds, against his recovering and holding the property so acquired
or any part thereof. And whether in such an event, he may recover from his wife any share of the
money used for the purchase or charge her with unauthorized disposition or expenditure of conjugal
funds is not now inquired into; that would be, in the premises, a purely academic exercise. An
equally decisive consideration is that Estelita Padilla is a purchaser in good faith, both the Trial Court
and the Appellate Court having found that Cheesman's own conduct had led her to believe the
property to be exclusive property of the latter's wife, freely disposable by her without his consent or
intervention. An innocent buyer for value, she is entitled to the protection of the law in her purchase,
particularly as against Cheesman, who would assert rights to the property denied him by both letter
and spirit of the Constitution itself.

WHEREFORE, the appealed decision is AFFIRMED, with costs against petitioner.

SO ORDERED.

G.R. No. L-5897 April 23, 1954

KING MAU WU, plaintiff-appellee,

vs.
FRANCISCO SYCIP, defendant-appellant.

I.C. Monsod for appellant.

J.A. Wolfson and P. P. Gallardo for appellee.
PADILLA, J.:

This is an action to collect P59,082.92, together with lawful interests from 14 October 1947, the date
of the written demand for payment, and costs. The claim arises out of a shipment of 1,000 tons of
coconut oil emulsion sold by the plaintiff, as agent of the defendant, to Jas. Maxwell Fassett, who in
turn assigned it to Fortrade Corporation. Under an agency agreement set forth in a letter dated 7
November 1946 in New York addressed to the defendant and accepted by the latter on the 22nd day
of the same month, the plaintiff was made the exclusive agent of the defendant in the sale of
coconut oil and its derivatives outside the Philippines and was to be paid 2 1/2 per cent on the total
actual sale price of sales obtained through his efforts in addition thereto 50 per cent of the difference
between the authorized sale price and the actual sale price.

After the trial where the depositions of the plaintiff and of Jas. Maxwell Fassett and several letters in
connection therewith were introduced and the testimony of the defendant was heard, the Court
rendered judgment as prayed for in the complaint. A motion for reconsideration was denied. A
motion for a new trial was filed, supported by the defendant's affidavit, based on newly discovered
evidence which consists of a duplicate original of a letter dated 16 October 1946 covering the sale of
1,000 tons of coconut oil soap emulsion signed by Jas. Maxwell Fassett assigned by the latter to the
defendant; the letter of credit No. 20122 of the Chemical Bank & Trust Company in favor of Jas.
Maxwell Fassett assigned by the latter to the defendant; and a letter dated 16 December 1946 by
the Fortrade Corporation to Jas. Maxwell Fassett accepted it on 24 December 1946, all of which
documents, according to the defendant, could not be produced at the trial, despite the use of
reasonable diligence, and if produced they would alter the result of the controversy. The motion for
new trial was denied. The defendant is appealing from said judgment.

Both parties agreed that the only transaction or sale made by the plaintiff, as agent of the defendant,
was that of 1,000 metric tons of coconut oil emulsion f.o.b. in Manila, Philippines, to Jas. Maxwell
Fassett, in whose favor letter of credit No. 20112 of the Chemical Bank & Trust Company for a sum
not to exceed $400,000 was established and who assigned to Fortrade Corporation his fight to the
1,000 metric tons of coconut oil emulsion and in the defendant the letter of credit referred to for a
sum not to exceed $400,000.

The plaintiff claims that for that sale he is entitled under the agency contract dated 7 November 1946
and accepted by the defendant on 22 November of the same year to a commission of 2 1/2 per cent
on the total actual sale price of 1,000 tons of coconut oil emulsion, part of which has been paid by
the defendant, there being only a balance of $3,794.94 for commission due and unpaid on the last
shipment of 379.494 tons and 50 per cent of the difference between the authorized sale price of
$350 per ton and the actual selling price of $400 per ton, which amounts to $25,000 due and unpaid,
and $746.52 for interest from 14 October 1947, the date of the written demand.

The defendant, on the other hand, contends that the transaction for the sale of 1,000 metric tons of
coconut oil emulsion was not covered by the agency contract of 22 November 1946 because it was
agreed upon on 16 October 1946; that it was an independent and separate transaction for which the
plaintiff has been duly compensated. The contention is not borne out by the evidence. The plaintiff
and his witness depose that there were several drafts of documents or letter prepared by Jas.
Maxwell Fassett preparatory or leading to the execution of the agency agreement of 7 November
1946, which was accepted by the defendant on 22 November 1946, and that the letter, on which the
defendant bases his contention that the transaction on the 1,000 metric tons of coconut oil emulsion
was not covered by the agency agreement, was one of those letters. That is believable. The letter
upon which defendant relies for his defense does not stipulate on the commission to be paid to the
plaintiff as agent, and yet if he paid the plaintiff a 2 1/2 per cent commission on the first three
coconut oil emulsion shipments, there is no reason why he should not pay him the same commission
on the last shipment amounting to $3,794.94. There can be no doubt that the sale of 1,000 metric
tons of coconut oil emulsion was not a separate and independent contract from that of the agency
agreement on 7 November and accepted on 22 November 1946 by the defendant, because in a
letter dated 2 January 1947 addressed to the plaintiff, referring to the transaction of 1,000 metric
tons of coconut oil emulsion, the defendant says —

. . . I am doing everything possible to fulfill these 1,000 tons of emulsion, and until such time
that we completed this order I do not feel it very sensible on my part to accept any more
orders. I want to prove to Fortrade, yourself and other people that we deliver our goods.
Regarding your commission, it is understood to be 2 1/2 per cent of all prices quoted by me
plus 50-50 on over price. (Schedule B.)

In another letter dated 16 January 1957 to the plaintiff, speaking of the same transaction, the
defendant says —

As per our understanding when I was in the States the overprice is subject to any increase in
the cost of production. I am not trying to make things difficult for you and I shall give you your
2 1/2 per cent commission plus our overprice provided you can give me substantial order in
order for me to amortize my loss on this first deal. Unless such could be arranged I shall
remit to you for the present your commission upon collection from the bank. (Schedule C.)

In a telegram sent by the defendant to the plaintiff the former says —

. . . Your money pending stop understand you authorized some local attorneys and my
relatives to intervene your behalf. (Schedule D.)

The defendant's claim that the agreement for the sale of the 1,000 metric tons of coconut oil
emulsion was agreed upon in a document, referring to the letter of 16 October 1946, is again
disproved by his letter dated 2 December 1946 to Fortrade Corporation where he says:

The purpose of this letter is to confirm in final form the oral agreement which we have
heretofore reached, as between ourselves, during the course of various conversations
between us and our respective representatives upon the subject matter of this letter.

It is understood that I am to sell to you, and you are to purchase from me, 1,000 tons of
coconut oil soap emulsion at a price of $400. per metric ton, i.e. 2,204.6 pounds, F.O.B.
shipboard, Manila, P.I. (Exhibit S, Special. Emphasis supplied.)

The contention that as the contract was executed in New York, the Court of First Instance of Manila
has no jurisdiction over this case, is without merit, because a non-resident may sue a resident in the
courts of this country1 where the defendant may be summoned and his property leviable upon
execution in the case of a favorable, final and executory judgment. It is a personal action for the
collection of a sum of money which the Courts of First Instance have jurisdiction to try and decide.
There is no conflict of laws involved in the case, because it is only a question of enforcing an
obligation created by or arising from contract; and unless the enforcement of the contract be against
public policy of the forum, it must be enforced.

The plaintiff is entitled to collect P7,589.88 for commission and P50,000 for one-half of the overprice,
or a total of P57,589.88, lawful interests thereon from the date of the filing of the complaint, and
costs in both instances.
As thus modified the judgment appealed from is affirmed, with costs against the appellant.

Paras, C.J., Pablo, Bengzon, Montemayor, Reyes, Jugo, Bautista Angelo, and Concepcion,
JJ., concur.

G.R. No. 76714 June 2, 1994

SALUD TEODORO VDA. DE PEREZ, petitioner,

vs.
HON. ZOTICO A. TOLETE in his capacity as Presiding Judge, Branch 18, RTC,
Bulacan, respondent.

Natividad T. Perez for petitioner.

Benedicto T. Librojo for private respondents.

QUIASON, J.:

This is a petition for certiorari under Rule 65 of the Revised Rules of Court to set aside the Order
dated November 19, 1986 of the Regional Trial Court, Branch 18, Bulacan presided by respondent
Judge Zotico A. Tolete, in Special Proceedings No. 1793-M.

We grant the petition.

II

Dr. Jose F. Cunanan and his wife, Dr. Evelyn Perez-Cunanan, who became American citizens,
established a successful medical practice in New York, U.S.A. The Cunanans lived at No. 2896
Citation Drive, Pompey, Syracuse, New York, with their children, Jocelyn, 18; Jacqueline, 16; and
Josephine, 14.

On August 23, 1979, Dr. Cunanan executed a last will and testament, bequeathing to his wife "all the
remainder" of his real and personal property at the time of his death "wheresoever situated" (Rollo,
p. 35). In the event he would survive his wife, he bequeathed all his property to his children and
grandchildren with Dr. Rafael G. Cunanan, Jr. as trustee. He appointed his wife as executrix of his
last will and testament and Dr. Rafael G. Cunanan, Jr. as substitute executor. Article VIII of his will
states:

If my wife, EVELYN PEREZ-CUNANAN, and I shall die under such circumstances

that there is not sufficient evidence to determine the order of our deaths, then it shall
be presumed that I predeceased her, and my estate shall be administered and
distributed, in all respects, in accordance with such presumption (Rollo, p. 41).
Four days later, on August 27, Dr. Evelyn P. Cunanan executed her own last will and testament
containing the same provisions as that of the will of her husband. Article VIII of her will states:

If my husband, JOSE F. CUNANAN, and I shall die under such circumstances that
there is not sufficient evidence to determine the order of our deaths, then it shall be
presumed that he predeceased me, and my estate shall be administered and
distributed in all respects, in accordance with such presumption. (Rollo, p. 31).

On January 9, 1982, Dr. Cunanan and his entire family perished when they were trapped by fire that
gutted their home. Thereafter, Dr. Rafael G. Cunanan, Jr. as trustee and substitute executor of the
two wills, filed separate proceedings for the probate thereof with the Surrogate Court of the County
of Onondaga, New York. On April 7, these two wills were admitted to probate and letters
testamentary were issued in his favor.

On February 21, 1983, Salud Teodoro Perez, the mother of Dr. Evelyn P. Cunanan, and petitioner
herein, filed with the Regional P. Cunanan, and petitioner herein, filed with the Regional Trial Court,
Malolos, Bulacan a petition for the reprobate of the two bills ancillary to the probate proceedings in
New York. She also asked that she be appointed the special administratrix of the estate of the
deceased couple consisting primarily of a farm land in San Miguel, Bulacan.

On March 9, the Regional Trial Court, Branch 16, Malolos, Bulacan, presided by Judge Gualberto J.
de la Llana, issued an order, directing the issuance of letters of special administration in favor of
petitioner upon her filing of a P10,000.00 bond. The following day, petitioner posted the bond and
took her oath as special administration.

As her first act of administration, petitioner filed a motion, praying that the Philippine Life Insurance
Company be directed to deliver the proceeds in the amount of P50,000.00 of the life insurance policy
taken by Dr. Jose F. Cunanan with Dr. Evelyn Perez-Cunanan and their daughter Jocelyn as
beneficiaries. The trial court granted the motion.

Counsel for the Philippine American Life Insurance Company then filed a manifestation, stating that
said company then filed a manifestation, stating that said company had delivered to petitioner the
amount of P49,765.85, representing the proceeds of the life insurance policy of Dr. Jose F.
Cunanan.

In a motion dated May 19, 1983, petitioner asked that Dr. Rafael Cunanan, Sr. be ordered to deliver
to her a Philippine Trust Company passbook with P25,594.00 in savings deposit, and the Family
Savings Bank time deposit certificates in the total amount of P12,412.52.

On May 31, Atty. Federico Alday filed a notice of appearance as counsel for the heirs of Dr. Jose F.
Cunanan, namely, Dr. Rafael Cunanan, Sr., Priscilla Cunanan Bautista, Lydia Cunanan Ignacio,
Felipe F. Cunanan and Loreto Cunanan Concepcion (Cunanan heirs). He also manifested that
before receiving petitioner's motion of May 19, 1983, his clients were unaware of the filing of the
testate estate case and therefore, "in the interest of simple fair play," they should be notified of the
proceedings (Records, p. 110). He prayed for deferment of the hearing on the motions of May 19,
1983.

Petitioner then filed a counter manifestation dated June 13, 1983, asserting: (1) that the "Cunanan
collaterals are neither heirs nor creditors of the late Dr. Jose F. Cunanan" and therefore, they had
"no legal or proprietary interests to protect" and "no right to intervene"; (2) that the wills of Dr. Jose F.
Cunanan and Dr. Evelyn Perez-Cunanan, being American citizens, were executed in accordance
with the solemnities and formalities of New York laws, and produced "effects in this jurisdiction in
accordance with Art. 16 in relation to Art. 816 of the Civil Code"; (3) that under Article VIII of the two
wills, it was presumed that the husband predeceased the wife; and (4) that "the Cunanan collaterals
are neither distributees, legatees or beneficiaries, much less, heirs as heirship is only by institution"
under a will or by operation of the law of New York (Records, pp. 112-113).

On June 23, the probate court granted petitioner's motion of May 19, 1983. However, on July 21, the
Cunanan heirs filed a motion to nullify the proceedings and to set aside the appointment of, or to
disqualify, petitioner as special administratrix of the estates of Dr. Jose F. Cunanan and Dr. Evelyn
Perez-Cunanan. The motion stated: (1) that being the "brothers and sisters and the legal and
surviving heirs" of Dr. Jose F. Cunanan, they had been "deliberately excluded" in the petition for the
probate of the separate wills of the Cunanan spouses thereby misleading the Bulacan court to
believe that petitioner was the sole heir of the spouses; that such "misrepresentation" deprived them
of their right to "due process in violation of Section 4, Rule 76 of the Revised Rules of Court; (2) that
Dr. Rafael G. Cunanan, Jr., the executor of the estate of the Cunanan spouses, was likewise not
notified of the hearings in the Bulacan court; (3) that the "misrepresentation and concealment
committed by" petitioner rendered her unfit to be a special administratrix; (4) that Dr. Rafael G.
Cunanan, Jr. had, by virtue of a verified power of attorney, authorized his father,
Dr. Rafael Cunanan, Sr., to be his attorney-in-fact; and (5) that Dr. Rafael Cunanan, Sr. is qualified
to be a regular administrator "as practically all of the subject estate in the Philippines belongs to their
brother, Dr. Jose F. Cunanan" (Records, pp. 118-122). Hence, they prayed: (1) that the proceedings
in the case be declared null and void; (2) that the appointment of petitioner as special administratrix
be set aside; and (3) that Dr. Rafael Cunanan, Sr. be appointed the regular administrator of the
estate of the deceased spouses.

Thereafter, the Cunanan heirs filed a motion requiring petitioner to submit an inventory or accounting
of all monies received by her in trust for the estate.

In her opposition, petitioner asserted: (1) that she was the "sole and only heir" of her daughter, Dr.
Evelyn Perez-Cunanan to the exclusion of the "Cunanan collaterals"; hence they were complete
strangers to the proceedings and were not entitled to notice; (2) that she could not have "concealed"
the name and address of Dr. Rafael G. Cunanan, Jr. because his name was prominently mentioned
not only in the two wills but also in the decrees of the American surrogate court; (3) that the rule
applicable to the case is Rule 77, not Rule 76, because it involved the allowance of wills proved
outside of the Philippines and that nowhere in Section 2 of Rule 77 is there a mention of notice being
given to the executor who, by the same provision, should himself file the necessary ancillary
proceedings in this country; (4) that even if the Bulacan estate came from the "capital" of Dr. Jose F.
Cunanan, he had willed all his worldly goods to his wife and nothing to his brothers and sisters; and
(5) that Dr. Rafael G. Cunanan, Jr. had unlawfully disbursed $215,000.00 to the Cunanan heirs,
misappropriated $15,000.00 for himself and irregularly assigned assets of the estates to his
American lawyer (Records, pp. 151-160).

In their reply, the Cunanan heirs stressed that on November 24, 1982, petitioner and the Cunanan
heirs had entered into an agreement in the United States "to settle and divide equally the estates,"
and that under Section 2 of Rule 77 the "court shall fix a time and place for the hearing and cause
notice thereof to be given as in case of an original will presented for allowance" (Records, pp. 184-
185).

Petitioner asked that Dr. Rafael G. Cunanan, Jr. be cited for contempt of court for failure to comply
with the Order of June 23, 1983 and for appropriating money of the estate for his own benefit. She
also alleged that she had impugned the agreement of November 24, 1982 before the Surrogate
Court of Onondaga, New York which rendered a decision on April 13, 1983, finding that "all assets
are payable to Dr. Evelyn P. Cunanan’s executor to be then distributed pursuant to EPTL4-1.1 subd
[a] par [4]" (Rollo, p. 52).

On their part, the Cunanan heirs replied that petitioner was estopped from claiming that they were
heirs by the agreement to divide equally the estates. They asserted that by virtue of Section 2 of
Rule 77 of the Rules of Court, the provisions of Sections 3, 4 and 5 of Rule 76 on the requirement of
notice to all heirs, executors, devisees and legatees must be complied with. They reiterated their
prayer: (1) that the proceedings in the case be nullified; (2) that petitioner be disqualified as special
administratrix; (3) that she be ordered to submit an inventory of all goods, chattels and monies which
she had received and to surrender the same to the court; and (4) that Dr. Rafael Cunanan, Sr. be
appointed the regular administrator.

Petitioner filed a rejoinder, stating that in violation of the April 13, 1983 decision of the American
court Dr. Rafael G. Cunanan, Jr. made "unauthorized disbursements from the estates as early as
July 7, 1982" (Records, p. 231). Thereafter, petitioner moved for the suspension of the proceedings
as she had "to attend to the settlement proceedings" of the estate of the Cunanan spouses in New
York (Records, p. 242). The Cunanans heirs opposed this motion and filed a manifestation, stating
that petitioner had received $215,000.00 "from the Surrogate’s Court as part of legacy" based on the
aforesaid agreement of November 24, 1982 (Records, p. 248).

On February 21, 1984, Judge de la Llana issued an order, disallowing the reprobate of the two wills,
recalling the appointment of petitioner as special administratrix, requiring the submission of petitioner
of an inventory of the property received by her as special administratrix and declaring all pending
incidents moot and academic. Judge de la Llana reasoned out that petitioner failed to prove the law
of New York on procedure and allowance of wills and the court had no way of telling whether the
wills were executed in accordance with the law of New York. In the absence of such evidence, the
presumption is that the law of succession of the foreign country is the same as the law of the
Philippines. However, he noted, that there were only two witnesses to the wills of the Cunanan
spouses and the Philippine law requires three witnesses and that the wills were not signed on each
and every page, a requirement of the Philippine law.

On August 27, 1985, petitioner filed a motion for reconsideration of the Order dated February 21,
1984, where she had sufficiently proven the applicable laws of New York governing the execution of
last wills and testaments.

On the same day, Judge de la Llana issued another order, denying the motion of petitioner for the
suspension of the proceedings but gave her 15 days upon arrival in the country within which to act
on the other order issued that same day. Contending that the second portion of the second order left
its finality to the discretion of counsel for petitioner, the Cunanans filed a motion for the
reconsideration of the objectionable portion of the said order so that it would conform with the
pertinent provisions of the Judiciary Reorganization Act of 1980 and the Interim Rules of Court.

On April 30, 1985, the respondent Judge of Branch 18 of the Regional Trial Court, Malolos, to which
the reprobate case was reassigned, issued an order stating that "(W)hen the last will and testament .
. . was denied probate," the case was terminated and therefore all orders theretofore issued should
be given finality. The same Order amended the February 21, 1984 Order by requiring petitioner to
turn over to the estate the inventoried property. It considered the proceedings for all intents and
purposes, closed (Records,
p. 302).

On August 12, petitioner filed a motion to resume proceedings on account of the final settlement and
termination of the probate cases in New York. Three days later, petitioner filed a motion praying for
the reconsideration of the Order of April 30, 1985 on the strength of the February 21, 1984 Order
granting her a period of 15 days upon arrival in the country within which to act on the denial of
probate of the wills of the Cunanan spouses. On August 19, respondent Judge granted the motion
and reconsidered the Order of April 30, 1985.

On August 29, counsel for petitioner, who happens to be her daughter, Natividad, filed a motion
praying that since petitioner was ailing in Fort Lee, New Jersey, U.S.A. and therefore incapacitated
to act as special administratrix, she (the counsel) should be named substitute special administratrix.
She also filed a motion for the reconsideration of the Order of February 21, 1984, denying probate to
the wills of the Cunanan spouses, alleging that respondent Judge "failed to appreciate the significant
probative value of the exhibits . . . which all refer to the offer and admission to probate of the last
wills of the Cunanan spouses including all procedures undertaken and decrees issued in connection
with the said probate" (Records, pp. 313-323).

Thereafter, the Cunanans heirs filed a motion for reconsideration of the Order of August 19, 1985,
alleging lack of notice to their counsel.

On March 31, 1986, respondent Judge to which the case was reassigned denied the motion for
reconsideration holding that the documents submitted by petitioner proved "that the wills of the
testator domiciled abroad were properly executed, genuine and sufficient to possess real and
personal property; that letters testamentary were issued; and that proceedings were held on a
foreign tribunal and proofs taken by a competent judge who inquired into all the facts and
circumstances and being satisfied with his findings issued a decree admitting to probate the wills in
question." However, respondent Judge said that the documents did not establish the law of New
York on the procedure and allowance of wills (Records, p. 381).

On April 9, 1986, petitioner filed a motion to allow her to present further evidence on the foreign law.
After the hearing of the motion on April 25, 1986, respondent Judge issued an order wherein he
conceded that insufficiency of evidence to prove the foreign law was not a fatal defect and was
curable by adducing additional evidence. He granted petitioner 45 days to submit the evidence to
that effect.

However, without waiting for petitioner to adduce the additional evidence, respondent Judge ruled in
his order dated June 20, 1986 that he found "no compelling reason to disturb its ruling of March 31,
1986" but allowed petitioner to "file anew the appropriate probate proceedings for each of the
testator" (Records, p. 391).

The Order dated June 20, 1986 prompted petitioner to file a second motion for reconsideration
stating that she was "ready to submit further evidence on the law obtaining in the State of New York"
and praying that she be granted "the opportunity to present evidence on what the law of the State of
New York has on the probate and allowance of wills" (Records, p. 393).

On July 18, respondent Judge denied the motion holding that to allow the probate of two wills in a
single proceeding "would be a departure from the typical and established mode of probate where
one petition takes care of one will." He pointed out that even in New York "where the wills in
question were first submitted for probate, they were dealt with in separate proceedings" (Records, p.
395).

On August 13, 1986, petitioner filed a motion for the reconsideration of the Order of July 18, 1986,
citing Section 3, Rule 2 of the Rules of Court, which provides that no party may institute more than
one suit for a single cause of action. She pointed out that separate proceedings for the wills of the
spouses which contain basically the same provisions as they even named each other as a
beneficiary in their respective wills, would go against "the grain of inexpensive, just and speedy
determination of the proceedings" (Records, pp. 405-407).

On September 11, 1986, petitioner filed a supplement to the motion for reconsideration,
citing Benigno v. De La Peña, 57 Phil. 305 (1932) (Records,
p. 411), but respondent Judge found that this pleading had been filed out of time and that the
adverse party had not been furnished with a copy thereof. In her compliance, petitioner stated that
she had furnished a copy of the motion to the counsel of the Cunanan heirs and reiterated her
motion for a "final ruling on her supplemental motion" (Records, p. 421).

On November 19, respondent Judge issued an order, denying the motion for reconsideration filed by
petitioner on the grounds that "the probate of separate wills of two or more different persons even if
they are husband and wife cannot be undertaken in a single petition" (Records, pp. 376-378).

Hence, petitioner instituted the instant petition, arguing that the evidence offered at the hearing of
April 11, 1983 sufficiently proved the laws of the State of New York on the allowance of wills, and
that the separate wills of the Cunanan spouses need not be probated in separate proceedings.

II

Petitioner contends that the following pieces of evidence she had submitted before respondent
Judge are sufficient to warrant the allowance of the wills:

(a) two certificates of authentication of the respective wills of Evelyn and Jose by the
Consulate General of the Philippines (Exhs. "F" and "G");

(b) two certifications from the Secretary of State of New York and Custodian of the
Great Seal on the facts that Judge Bernard L. Reagan is the Surrogate of the
Country of Onondaga which is a court of record, that his signature and seal of office
are genuine, and that the Surrogate is duly authorized to grant copy of the respective
wills of Evelyn and Jose
(Exhs. "F-1" and "G-1");

(c) two certificates of Judge Reagan and Chief Clerk Donald E. Moore stating that
they have in their records and files the said wills which were recorded on April 7,
1982 (Exhs. "F-2" and "G-2");

(d) the respective wills of Evelyn and Jose (Exhs. "F-3", "F-6" and Exh. "G-3" — "G-
6");

(e) certificates of Judge Reagan and the Chief Clerk certifying to the genuineness
and authenticity of the exemplified copies of the two wills (Exhs. "F-7" and "F-7");

(f) two certificates of authentication from the Consulate General of the Philippines in
New York (Exh. "H" and "F").

(g) certifications from the Secretary of State that Judge Reagan is duly authorized to
grant exemplified copies of the decree of probate, letters testamentary and all
proceedings had and proofs duly taken
(Exhs. "H-1" and "I-1");
 (h) certificates of Judge Reagan and the Chief Clerk that letters testamentary were
issued to Rafael G. Cunanan (Exhs. "H-2" and "I-2");

(i) certification to the effect that it was during the term of Judge Reagan that a decree
admitting the wills to probate had been issued and appointing Rafael G. Cunanan as
alternate executor (Exhs. "H-3" and
"I-10");

(j) the decrees on probate of the two wills specifying that proceedings were held and
proofs duly taken (Exhs. "H-4" and "I-5");

(k) decrees on probate of the two wills stating that they were properly executed,
genuine and valid and that the said instruments were admitted to probate and
established as wills valid to pass real and personal property (Exhs. "H-5" and "I-5");
and

(l) certificates of Judge Reagan and the Chief Clerk on the genuineness and
authenticity of each other’s signatures in the exemplified copies of the decrees of
probate, letters testamentary and proceedings held in their court (Exhs. "H-6" and "I-
6") (Rollo, pp. 13-16).

Petitioner adds that the wills had been admitted to probate in the Surrogate Court’s Decision of April
13, 1983 and that the proceedings were terminated on November 29, 1984.

The respective wills of the Cunanan spouses, who were American citizens, will only be effective in
this country upon compliance with the following provision of the Civil Code of the Philippines:

Art. 816. The will of an alien who is abroad produces effect in the Philippines if made
with the formalities prescribed by the law of the place in which he resides, or
according to the formalities observed in his country, or in conformity with those which
this Code prescribes.

Thus, proof that both wills conform with the formalities prescribed by New York laws or by Philippine
laws is imperative.

The evidence necessary for the reprobate or allowance of wills which have been probated outside of
the Philippines are as follows: (1) the due execution of the will in accordance with the foreign laws;
(2) the testator has his domicile in the foreign country and not in the Philippines; (3) the will has been
admitted to probate in such country; (4) the fact that the foreign tribunal is a probate court, and (5)
the laws of a foreign country on procedure and allowance of wills (III Moran Commentaries on the
Rules of Court, 1970 ed., pp. 419-429; Suntay v. Suntay, 95 Phil. 500 [1954]; Fluemer v. Hix, 54
Phil. 610 [1930]). Except for the first and last requirements, the petitioner submitted all the needed
evidence.

The necessity of presenting evidence on the foreign laws upon which the probate in the foreign
country is based is impelled by the fact that our courts cannot take judicial notice of them (Philippine
Commercial and Industrial Bank v. Escolin, 56 SCRA 266 [1974]).

Petitioner must have perceived this omission as in fact she moved for more time to submit the
pertinent procedural and substantive New York laws but which request respondent Judge just
glossed over. While the probate of a will is a special proceeding wherein courts should relax the
rules on evidence, the goal is to receive the best evidence of which the matter is susceptible before
a purported will is probated or denied probate (Vda. de Ramos v. Court of Appeals, 81 SCRA 393
[1978]).

There is merit in petitioner’s insistence that the separate wills of the Cunanan spouses should be
probated jointly. Respondent Judge’s view that the Rules on allowance of wills is couched in singular
terms and therefore should be interpreted to mean that there should be separate probate
proceedings for the wills of the Cunanan spouses is too literal and simplistic an approach. Such view
overlooks the provisions of Section 2, Rule 1 of the Revised Rules of Court, which advise that the
rules shall be "liberally construed in order to promote their object and to assist the parties in
obtaining just, speedy, and inexpensive determination of every action and proceeding."

A literal application of the Rules should be avoided if they would only result in the delay in the
administration of justice (Acain v. Intermediate Appellate Court, 155 SCRA 100 [1987]; Roberts v.
Leonidas, 129 SCRA 33 [1984]).

What the law expressly prohibits is the making of joint wills either for the testator’s reciprocal benefit
or for the benefit of a third person (Civil Code of the Philippines, Article 818). In the case at bench,
the Cunanan spouses executed separate wills. Since the two wills contain essentially the same
provisions and pertain to property which in all probability are conjugal in nature, practical
considerations dictate their joint probate. As this Court has held a number of times, it will always
strive to settle the entire controversy in a single proceeding leaving no root or branch to bear the
seeds of future litigation (Motoomull v. Dela Paz, 187 SCRA 743 [1990]).

This petition cannot be completely resolved without touching on a very glaring fact — petitioner has
always considered herself the sole heir of
Dr. Evelyn Perez Cunanan and because she does not consider herself an heir of Dr. Jose F.
Cunanan, she noticeably failed to notify his heirs of the filing of the proceedings. Thus, even in the
instant petition, she only impleaded respondent Judge, forgetting that a judge whose order is being
assailed is merely a nominal or formal party (Calderon v. Solicitor General, 215 SCRA 876 [1992]).

The rule that the court having jurisdiction over the reprobate of a will shall "cause notice thereof to be
given as in case of an original will presented for allowance" (Revised Rules of Court, Rule 27,
Section 2) means that with regard to notices, the will probated abroad should be treated as if it were
an "original will" or a will that is presented for probate for the first time. Accordingly, compliance with
Sections 3 and 4 of Rule 76, which require publication and notice by mail or personally to the "known
heirs, legatees, and devisees of the testator resident in the Philippines" and to the executor, if he is
not the petitioner, are required.

The brothers and sisters of Dr. Jose F. Cunanan, contrary to petitioner's claim, are entitled to notices
of the time and place for proving the wills. Under Section 4 of Rule 76 of the Revised Rules of Court,
the "court shall also cause copies of the notice of the time and place fixed for proving the will to be
addressed to the designated or other known heirs, legatees, and devisees of the testator, . . . "

WHEREFORE, the questioned Order is SET ASIDE. Respondent Judge shall allow petitioner
reasonable time within which to submit evidence needed for the joint probate of the wills of the
Cunanan spouses and see to it that the brothers and sisters of Dr. Jose F. Cunanan are given all
notices and copies of all pleadings pertinent to the probate proceedings.

SO ORDERED.
G.R. No. L-28882 May 31, 1971

TIME, INC., petitioner,

vs.
HON. ANDRES REYES, as Judge of the Court of First Instance of Rizal, ELISEO S. ZARI, as
Deputy Clerk of Court, Branch VI, Court of First Instance of Rizal, ANTONIO J. VILLEGAS and
JUAN PONCE ENRILE,respondents.

Sycip, Salazar, Luna, Manalo & Feliciano for petitioner.

Angel C. Cruz Law Office for respondents.

REYES, J.B.L., J.:

Petition for certiorari and prohibition, with preliminary injunction, to annul certain orders of the
respondent Court of First Instance of Rizal, issued in its Civil Case No. 10403, entitled "Antonio J.
Villegas and Juan Ponce Enrile vs. Time, Inc., and Time-Life International, Publisher of 'Time'
Magazine (Asia Edition)", and to prohibit the said court from further proceeding with the said civil
case.

Upon petitioner's posting a bond of P1,000.00, this Court, as prayed for, ordered, on 15 April 1968,
the issuance of a writ of preliminary injunction.

The petition alleges that petitioner Time, Inc., 1 is an American corporation with principal offices at
Rocketfeller Center, New York City, N. Y., and is the publisher of "Time", a weekly news magazine;
the petition, however, does not allege the petitioner's legal capacity to sue in the courts of the
Philippine. 2

In the aforesaid Civil Case No. 10403, therein plaintiffs (herein respondents) Antonio J. Villegas and
Juan Ponce Enrile seek to recover from the herein petitioner damages upon an alleged libel arising
from a publication of Time (Asia Edition) magazine, in its issue of 18 August 1967, of an essay,
entitled "Corruption in Asia", which, in part, reads, as follows:

The problem of Manila's mayor, ANTONIO VILLEGAS, is a case in point. When it was
discovered last year that the mayor's coffers contained far more pesos than seemed
reasonable in the light of his income, an investigation was launched. Witnesses who had
helped him out under curious circumstance were asked to explain in court. One
government official admitted lending Villegas P30,000 pesos ($7,700) without interest
because he was the mayor's compadre. An assistant declared he had given Villegas
loans without collateral because he regarded the boss as my own son. A wealthy Manila
businessman testified that he had lent Villegas' wife 15,000 pesos because the mayor
was like a brother to me. With that, Villegas denounced the investigation as an invasion
of his family's privacy. The case was dismissed on a technicality, and Villegas is still
mayor. 3

More specifically, the plaintiffs' complaint alleges, inter alia that:

 (4) Defendants, conspiring and confederating, published a libelous article, publicly,
falsely and maliciously imputing to Plaintiffs the commission of the crimes of graft,
corruption and nepotism; that said publication particularly referred to Plaintiff Mayor
Antonio J. Villegas as a case in point in connection with graft, corruption and
nepotism in Asia; that said publication without any doubt referred to co-plaintiff Juan
Ponce Enrile as the high government official who helped under curious
circumstances Plaintiff Mayor Antonio J. Villegas in lending the latter approximately
P30,000.00 ($7,700.00) without interest because he was the Mayor's compadre; that
the purpose of said Publications is to cause the dishonor, discredit and put in public
contempt the Plaintiffs, particularly Plaintiff Mayor Antonio J. Villegas.

On motion of the respondents-plaintiffs, the respondent judge, on 25 November 1967, granted them
leave to take the depositions "of Mr. Anthony Gonzales, Time-Life international", and "Mr. Cesar B.
Enriquez, Muller & Phipps (Manila) Ltd.", in connection with the activities and operations in the
Philippines of the petitioner, and, on 27 November 1967, issued a writ of attachment on the real and
personal estate of Time, Inc.

Petitioner received the summons and a copy of the complaint at its offices in New York on 13
December 1967 and, on 27 December 1967, it filed a motion to dismiss the complaint for lack of
jurisdiction and improper venue, relying upon the provisions of Republic Act 4363. Private
respondents opposed the motion.

In an order dated 26 February 1968, respondent court deferred the determination of the motion to
dismiss until after trial of the case on the merits, the court having considered that the grounds relied
upon in the motion do not appear to be indubitable.

Petitioner moved for reconsideration of the deferment private respondents again opposed.

On 30 March 1968, respondent judge issued an order re-affirming the previous order of deferment
for the reason that "the rule laid down under Republic Act. No. 4363, amending Article 360 of the
Revised Penal Code, is not applicable to actions against non-resident defendants, and because
questions involving harassment and inconvenience, as well as disruption of public service do not
appear indubitable. ..."

Failing in its efforts to discontinue the taking of the depositions, previously adverted to, and to have
action taken, before trial, on its motion to dismiss, petitioner filed the instant petition for certiorari and
prohibition.

The orders for the taking of the said depositions, for deferring determination of the motion to dismiss,
and for reaffirming the deferment, and the writ of attachment are sought to be annulled in the
petition..

There is no dispute that at the time of the publication of the allegedly offending essay, private
respondents Antonio Villegas and Juan Ponce Enrile were the Mayor Of the City of Manila and
Undersecretary of Finance and concurrently Acting Commissioner of Customs, respectively, with
offices in the City of Manila. The issues in this case are:

1. Whether or not, under the provisions of Republic Act No. 4363 the respondent Court of First
Instance of Rizal has jurisdiction to take cognizance of the civil suit for damages arising from an
allegedly libelous publication, considering that the action was instituted by public officers whose
offices were in the City of Manila at the time of the publication; if it has no jurisdiction, whether or not
its erroneous assumption of jurisdiction may be challenged by a foreign corporation by writ
of certiorari or prohibition; and

2. Whether or not Republic Act 4363 is applicable to action against a foreign corporation or non-
resident defendant.

Provisions of Republic Act No. 4363, which are relevant to the resolution of the foregoing issues,
read, as follows:

Section 1. Article three hundred sixty of the Revised Penal Code, as amended by
Republic Act Numbered Twelve hundred and eighty-nine, is further amended to read
as follows:

'ART. 360. Persons responsible. — Any person who shall publish,

exhibit, or cause the publication or exhibition of any defamation in
writing or by similar means, shall be responsible for the same.

The author or editor of a book or pamphlet, or the editor or business manager of a

daily newspaper, magazine or serial publication, shall be responsible for the
defamations contained therein to the extent as if he were the author thereof.

The criminal and civil action for damages in cases of written defamations as provided
for in this chapter, shall be filed simultaneously or separately with the court of first
instance of the province or city where the libelous article is printed and first published
or where any of the offended parties actually resides at the time of the commission of
the offense; Provided, however, That where one of the offended parties is a public
officer whose office is in the City of Manila at the time of the commission of the
offense, the action shall be filed in the Court of First Instance of the City of Manila or
of the city or province where the libelous article is printed and first published, and in
case such public officer does not hold office in the City of Manila, the action shall be
filed in the Court of First Instance of the province or city where he held office at the
time of the commission of the offense or where the libelous article is printed and first
published and in case one of the offended parties is a private individual, the action
shall be filed in the Court of First Instance of the province or city where he actually
resides at the time of the commission of the offense or where the libelous matter is
printed and first published; Provided, further, That the civil action shall be filed in the
same court where the criminal action is filed and vice versa; Provided, furthermore,
That the court where the criminal action or civil action for damages is first filed, shall
acquire jurisdiction to the exclusion of other courts; And provided finally, That this
amendment shall not apply to cases of written defamations, the civil and/or criminal
actions which have been filed in court at the time of the effectivity of the law

xxx xxx xxx

xxx xxx xxx

Sec. 3. This Act shall take effect only if and when, within thirty days from its approval,
the newspapermen in the Philippines shall organize, and elect the members of, a
Philippine Press Council, a private agency of the said newspapermen, whose
function shall be to promulgate a Code of Ethics for them and the Philippine press
investigate violations thereof, and censure any newspaperman or newspaper guilty
of any violation of the said Code, and the fact that such Philippine Press Council has
 been organized and its members have been duly elected in accordance herewith
shall be ascertained and proclaimed by the President of the Philippines.

Under the first proviso in section 1, the venue of a civil action for damages in cases of written
defamations is localized upon the basis of, first, whether the offended party or plaintiff is a public
officer or a private individual; and second, if he is a public officer, whether his office is in Manila or
not in Manila, at the time of the commission of the offense. If the offended party is a public officer in
the office in the City of Manila, the proviso limits him to two (2) choices of venue, namely, in the
Court of First instance of the City of Manila or in the city or province where the libelous article is
printed and first published ..."

The complaint lodged in the court of Rizal by respondents does not allege that the libelous article
was printed and first published in the province of Rizal and, since the respondents-plaintiffs are
public officers with offices in Manila at the time of the commission of the alleged offense, it is clear
that the only place left for them wherein to file their action, is the Court of First Instance of Manila.

The limitation of the choices of venue, as introduced into the Penal Code through its amendments by
Republic Act 4363, was intended "to minimize or limit the filing of out-of-town libel suits" to protect an
alleged offender from "hardships, inconveniences and harassments" and, furthermore, to protect
"the interest of the public service" where one of the offended parties is a public officer." 4 The intent,
of the law is clear: a libeled public official might sue in the court of the locality where he holds office,
in order that the prosecution of the action should interfere as little as possible with the discharge of
his official duties and labors. The only alternative allowed him by law is to prosecute those
responsible for the libel in the place where the offending article was printed and first published. Here,
the law tolerates the interference with the libeled officer's duties only for the sake of avoiding
unnecessary harassment of the accused. Since the offending publication was not printed in the
Philippines, the alternative venue was not open to respondent Mayor Villegas of Manila and
Undersecretary of Finance Enrile, who were the offended parties.

But respondents-plaintiffs argue that Republic Act No. 4363 is not applicable where the action is
against non-existent defendant, as petitioner Time, Inc., for several reasons. They urge that, in
enacting Republic Act No. 4363, Congress did not intend to protect non-resident defendants as
shown by Section 3, which provides for the effectivity of the statute only if and when the
"newspapermen in the Philippines" have organized a "Philippine Press Council" whose function shall
be to promulgate a Code of Ethics for "them" and "the Philippine press"; and since a non-resident
defendant is not in a position to comply with the conditions imposed for the effectivity of the statute,
such defendant may not invoke its provisions; that a foreign corporation is not inconvenienced by an
out-of-town libel suit; that it would be absurd and incongruous, in the absence of an extradition
treaty, for the law to give to public officers with office in Manila the second option of filing a criminal
case in the court of the place where the libelous article is printed and first published if the defendant
is a foreign corporation and that, under the "single publication" rule which originated in the United
States and imported into the Philippines, the rule was understood to mean that publications in
another state are not covered by venue statutes of the forum.

The implication of respondents' argument is that the law would not take effect as to non-resident
defendants or accused. We see nothing in the text of the law that would sustain such unequal
protection to some of those who may be charged with libel. The official proclamation that a Philippine
Press Council has been organized is made a pre-condition to the effectivity of the entire Republic
Act No. 4363, and no terms are employed therein to indicate that the law can or will be effective only
as to some, but not all, of those that may be charged with libeling our public officers.
The assertion that a foreign corporation or a non-resident defendant is not inconvenienced by an
out-of-town suit is irrelevant and untenable, for venue and jurisdiction are not dependent upon
convenience or inconvenience to a party; and moreover, venue was fixed under Republic Act No.
4363, pursuant to the basic policy of the law that is, as previously stated, to protect the interest of the
public service when the offended party is a public officer, by minimizing as much as possible any
interference with the discharge of his duties.

That respondents-plaintiffs could not file a criminal case for libel against a non-resident defendant
does not make Republic Act No. 4363 incongruous of absurd, for such inability to file a criminal case
against a non-resident natural person equally exists in crimes other than libel. It is a fundamental
rule of international jurisdiction that no state can by its laws, and no court which is only a creature of
the state, can by its judgments or decrees, directly bind or affect property or persons beyond the
limits of the state. 5 Not only this, but if the accused is a corporation, no criminal action can lie against
it, 6 whether such corporation or resident or non-resident. At any rate, the case filed by respondents-
plaintiffs is case for damages.

50 Am. Jur. 2d 659 differentiates the "multiple publication" and "single publication" rules (invoked by
private respondents) to be as follows:

The common law as to causes of action for tort arising out of a single publication was
to the effect that each communication of written or printed matter was a distinct and
separate publication of a libel contained therein, giving rise to a separate cause of
action. This rule ('multiple publication' rule) is still followed in several American
jurisdictions, and seems to be favored by the American Law Institute. Other
jurisdictions have adopted the 'single publication' rule which originated in New York,
under which any single integrated publication, such as one edition of a newspaper,
book, or magazine, or one broadcast, is treated as a unit, giving rise to only one
cause of action, regardless of the number of times it is exposed to different people. ...

These rules are not pertinent in the present scheme because the number of causes of action that
may be available to the respondents-plaintiffs is not here in issue. We are here confronted by a
specific venue statute, conferring jurisdiction in cases of libel against Public officials to specified
courts, and no other. The rule is that where a statute creates a right and provides a remedy for its
enforcement, the remedy is exclusive; and where it confers jurisdiction upon a particular court, that
jurisdiction is likewise exclusive, unless otherwise provided. Hence, the venue provisions of Republic
Act No. 4363 should be deemed mandatory for the party bringing the action, unless the question of
venue should be waived by the defendant, which was not the case here. Only thus can the policy of
the Act be upheld and maintained. Nor is there any reason why the inapplicability of one alternative
venue should result in rendering the other alternative, also inapplicable.

The dismissal of the present petition is asked on the ground that the petitioner foreign corporation
failed to allege its capacity to sue in the courts of the Philippines. Respondents rely on section 69 of
the Corporation law, which provides:

SEC. 69. No foreign corporation or corporations formed, organized, or existing under

any laws other than those of the Philippines shall be permitted to ... maintain by itself
or assignee any suit for the recovery of any debt, claim, or demand whatever, unless
it shall have the license prescribed in the section immediately preceding. ..." ...;

They also invoke the ruling in Marshall-Wells Co. vs. Elser & Co., Inc. 7 that no foreign corporation
may be permitted to maintain any suit in the local courts unless it shall have the license required by
the law, and the ruling in Atlantic Mutual Ins. Co., Inc. vs. Cebu Stevedoring Co., Inc. 8 that "where ...
the law denies to a foreign corporation the right to maintain suit unless it has previously complied
with a certain requirement, then such compliance or the fact that the suing corporation is exempt
therefrom, becomes a necessary averment in the complaint." We fail to see how these doctrines can
be a propos in the case at bar, since the petitioner is not "maintaining any suit" but is merely
defending one against itself; it did not file any complaint but only a corollary defensive petition to
prohibit the lower court from further proceeding with a suit that it had no jurisdiction to entertain.

Petitioner's failure to aver its legal capacity to institute the present petition is not fatal, for ...

A foreign corporation may, by writ of prohibition, seek relief against the wrongful
assumption of jurisdiction. And a foreign corporation seeking a writ of prohibition against
further maintenance of a suit, on the ground of want of jurisdiction in which jurisdiction is
not bound by the ruling of the court in which the suit was brought, on a motion to quash
service of summons, that it has jurisdiction. 9

It is also advanced that the present petition is premature, since respondent court has not definitely
ruled on the motion to dismiss, nor held that it has jurisdiction, but only argument is untenable. The
motion to dismiss was predicated on the respondent court's lack of jurisdiction to entertain the
action; and the rulings of this Court are that writs of certiorari or prohibition, or both, may issue in
case of a denial or deferment of action on such a motion to dismiss for lack of jurisdiction.

If the question of jurisdiction were not the main ground for this petition for review
by certiorari, it would be premature because it seeks to have a review of an
interlocutory order. But as it would be useless and futile to go ahead with the
proceedings if the court below had no jurisdiction this petition was given due course.'
(San Beda vs. CIR, 51 O.G. 5636, 5638).

'While it is true that action on a motion to dismiss may be deferred until the trial and
an order to that effect is interlocutory, still where it clearly appears that the trial judge
or court is proceeding in excess or outside of its jurisdiction, the remedy of prohibition
would lie since it would be useless and a waste of time to go ahead with the
proceedings. (Philippine International Fair, Inc., et al. vs. Ibañez, et al., 50 Off. Gaz.
1036; Enrique v. Macadaeg, et al., 47 Off. Gaz. 1207; see also San Beda College vs.
CIR, 51 Off. Gaz. 5636.)' (University of Sto. Tomas v. Villanueva, L-13748, 30
October 1959.).

Similarly, in Edward J. Nell Co. vs. Cubacub, L-20843, 23 June 1965, 14 SCRA 419, this Court held:

'.......................................................... It is a settledrule that the jurisdiction of a court

over the subject-matter is determined by the allegations in the complaint; and when a
motion to dismiss is filed for lack of jurisdiction those allegations are deemed
admitted for purposes of such motion, so that it may be resolved without waiting for
the trial. Thus it has been held that the consideration thereof may not be postponed
in the hope that the evidence may yield other qualifying or concurring data which
would bring the case under the court's jurisdiction.'

To the same effect are the rulings in: Ruperto vs. Fernando, 83 Phil. 943; Administrator of Hacienda
Luisita Estate vs. Alberto, L-12133, 21 October 1958.

Summing up, We hold:

(1) The under Article 360 of the Revised Penal Code, as amended by Republic Act No. 4363,
actions for damages by public officials for libelous publications against them can only be filed in the
courts of first instance ofthe city or province where the offended functionary held office at the time
ofthe commission of the offense, in case the libelous article was first printed or published outside the
Philippines.

(2) That the action of a court in refusing to rule, or deferring its ruling, on a motion to dismiss for lack
of jurisdiction over the subject matter, or for improper venue, is in excess of jurisdiction and
correctable by writ of prohibition or certiorari sued out in the appellate Court, even before trial on the
merits is had.

WHEREFORE, the writs applied for are granted: the respondent Court of First Instance of Rizal is
declared without jurisdiction to take cognizance of its Civil Case No. 10403; and its orders issued in
connection therewith are hereby annulled and set aside,. Respondent court is further commanded to
desist from further proceedings in Civil case No. 10403 aforesaid. Costs against private
respondents, Antonio J. Villegas and Juan Ponce Enrile.

The writ of preliminary injunction heretofore issued by this Supreme Court is made permanent.

Concepcion, C.J., Dizon, Makalintal, Fernando, Teehankee, Barredo, Villamor and concur.

Castro, J., took no part.

United States v. Fowler

Brief Fact Summary. Fowler, Appellant, was convicted of failure to file tax returns for the years
1971-1975. He had not filed a tax return since 1953. He represented himself at trial and appealed
the conviction because the trial court did not let him testify because he would not swear or affirm to
tell the truth.

Synopsis of Rule of Law. Federal Rule of Evidence 603 provides that “before testifying, every
witness shall be required to declare that he will testify truthfully, by oath or affirmation.”

Facts. Fowler, Appellant, stopped filing tax returns in 1953. He was indicted for failing to
file returns from 1971-1975, and he was convicted. Appellant represented himself at trial
but was represented by counsel on appeal. He claims the court erred in not allowing
him to testify because he would not swear to tell the truth and would not allow cross
examination. Appellant was willing to state “I am a truthful man,” and “I would not tell a
lie to stay out of jail.” The judge was willing to allow him to say “I state I will tell the truth
in my testimony,” but Appellant did not agree.

Issue. Did the trial court err in refusing to allow him to testify because he would not
swear or affirm that he would tell the truth?

G.R. No. L-5887 December 16, 1910

THE UNITED STATES, plaintiff-appellee,
vs.
LOOK CHAW (alias LUK CHIU), defendant-appellant.

Thos. D. Aitken for appellant.

Attorney-General Villamor for appellee.

ARELLANO, C. J.:

The first complaint filed against the defendant, in the Court of First Instance of Cebu, stated that he
"carried, kept, possessed and had in his possession and control, 96 kilogrammes of opium," and that
"he had been surprised in the act of selling 1,000 pesos worth prepared opium."

The defense presented a demurrer based on two grounds, the second of which was the more than
one crime was charged in the complaint. The demurrer was sustained, as the court found that the
complaint contained two charges, one, for the unlawful possession of opium, and the other, for the
unlawful sale of opium, and, consequence of that ruling, it ordered that the fiscal should separated
one charge from the other and file a complaint for each violation; this, the fiscal did, and this cause
concerns only the unlawful possession of opium. It is registered as No. 375, in the Court of First
Instance of Cebu, and as No. 5887 on the general docket of this court.

The facts of the case are contained in the following finding of the trial court:

The evidence, it says, shows that between 11 and 12 o'clock a. m. on the present month
(stated as August 19, 1909), several persons, among them Messrs. Jacks and Milliron, chief
of the department of the port of Cebu and internal-revenue agent of Cebu, respectively, went
abroad the steamship Erroll to inspect and search its cargo, and found, first in a cabin near
the saloon, one sack (Exhibit A) and afterwards in the hold, another sack (Exhibit B). The
sack referred to as Exhibit A contained 49 cans of opium, and the other, Exhibit B, the larger
sack, also contained several cans of the same substance. The hold, in which the sack
mentioned in Exhibit B was found, was under the defendant's control, who moreover, freely
and of his own will and accord admitted that this sack, as well as the other referred to in
Exhibit B and found in the cabin, belonged to him. The said defendant also stated, freely and
voluntarily, that he had bought these sacks of opium, in Hongkong with the intention of
selling them as contraband in Mexico or Vera Cruz, and that, as his hold had already been
searched several times for opium, he ordered two other Chinamen to keep the sack. Exhibit
A.

It is to be taken into account that the two sacks of opium, designated as Exhibits A and B, properly
constitute thecorpus delicti. Moreover, another lot of four cans of opium, marked, as Exhibit C, was
the subject matter of investigation at the trial, and with respect to which the chief of the department
of the port of Cebu testified that they were found in the part of the ship where the firemen habitually
sleep, and that they were delivered to the first officer of the ship to be returned to the said firemen
after the vessel should have left the Philippines, because the firemen and crew of foreign vessels,
pursuant to the instructions he had from the Manila custom-house, were permitted to retain certain
amounts of opium, always provided it should not be taken shore.

And, finally, another can of opium, marked "Exhibit D," is also corpus delicti and important as
evidence in this cause. With regard to this the internal-revenue agent testified as follows:itc-alf
 FISCAL. What is it?

WITNESS. It is a can opium which was bought from the defendant by a secret-service agent
and taken to the office of the governor to prove that the accused had opium in his
possession to sell.

On motion by the defense, the court ruled that this answer might be stricken out "because it refers to
a sale." But, with respect to this answer, the chief of the department of customs had already given
this testimony, to wit:

FISCAL. Who asked you to search the vessel?

WITNESS. The internal-revenue agent came to my office and said that a party brought him a
sample of opium and that the same party knew that there was more opium on board the
steamer, and the agent asked that the vessel be searched.

The defense moved that this testimony be rejected, on the ground of its being hearsay evidence,
and the court only ordered that the part thereof "that there was more opium, on board the vessel" be
stricken out.

The defense, to abbreviate proceedings, admitted that the receptacles mentioned as Exhibits A, B,
and C, contained opium and were found on board the steamship Erroll, a vessel of English
nationality, and that it was true that the defendant stated that these sacks of opium were his and that
he had them in his possession.

According to the testimony of the internal-revenue agent, the defendant stated to him, in the
presence of the provincial fiscal, of a Chinese interpreter (who afterwards was not needed, because
the defendant spoke English), the warden of the jail, and four guards, that the opium seized in the
vessel had been bought by him in Hongkong, at three pesos for each round can and five pesos for
each one of the others, for the purpose of selling it, as contraband, in Mexico and Puerto de Vera
Cruz; that on the 15th the vessel arrived at Cebu, and on the same day he sold opium; that he had
tried to sell opium for P16 a can; that he had a contract to sell an amount of the value of about P500;
that the opium found in the room of the other two Chinamen prosecuted in another cause, was his,
and that he had left it in their stateroom to avoid its being found in his room, which had already been
searched many times; and that, according to the defendant, the contents of the large sack was 80
cans of opium, and of the small one, 49, and the total number, 129.

It was established that the steamship Erroll was of English nationality, that it came from Hongkong,
and that it was bound for Mexico, via the call ports of Manila and Cebu.

The defense moved for a dismissal of the case, on the grounds that the court had no jurisdiction to
try the same and the facts concerned therein did not constitute a crime. The fiscal, at the conclusion
of his argument, asked that the maximum penalty of the law be imposed upon the defendant, in view
of the considerable amount of opium seized. The court ruled that it did not lack jurisdiction, inasmuch
as the crime had been committed within its district, on the wharf of Cebu.

The court sentenced the defendant to five years' imprisonment, to pay a fine of P10,000, with
additional subsidiary imprisonment in case of insolvency, though not to exceed one third of the
principal penalty, and to the payment of the costs. It further ordered the confiscation, in favor of the
Insular Government, of the exhibits presented in the case, and that, in the event of an appeal being
taken or a bond given, or when the sentenced should have been served, the defendant be not
released from custody, but turned over to the customs authorities for the purpose of the fulfillment of
the existing laws on immigration.

From this judgment, the defendant appealed to this court. lawphi1.net

The appeal having been heard, together with the allegations made therein by the parties, it is found:
That, although the mere possession of a thing of prohibited use in these Islands, aboard a foreign
vessel in transit, in any of their ports, does not, as a general rule, constitute a crime triable by the
courts of this country, on account of such vessel being considered as an extension of its own
nationality, the same rule does not apply when the article, whose use is prohibited within the
Philippine Islands, in the present case a can of opium, is landed from the vessel upon Philippine soil,
thus committing an open violation of the laws of the land, with respect to which, as it is a violation of
the penal law in force at the place of the commission of the crime, only the court established in that
said place itself had competent jurisdiction, in the absence of an agreement under an international
treaty.

It is also found: That, even admitting that the quantity of the drug seized, the subject matter of the
present case, was considerable, it does not appear that, on such account, the two penalties fixed by
the law on the subject, should be imposed in the maximum degree.

Therefore, reducing the imprisonment and the fine imposed to six months and P1,000, respectively,
we affirm in all other respects the judgment appealed from, with the costs of this instance against the
appellant. So ordered.

G.R. No. L-45144 April 3, 1939

M. E. GREY, Plaintiff-Appellant, vs. INSULAR LUMBER

COMPANY, defendant-appelle.

C. H. Van Hoven and Harvey and O'Brien for appellant.

Ross, Lawrence, Selph and Carrascoso for appellee.

CONCEPCION, J.: chanrobles virtual law library

The only question of law raised in this appeal is whether the

plaintiff-appellant is entitled, as stockholder of the defendant-
appellee Insular Lumber Company, to inspect and examine the
books records of the transactions of said defendant. chanroble svirtualawlibrary chanroble s virtual law library

The parties submitted a stipulation of facts on which the lower court

based its judgment denying the mandamus against the defendant
and absolving it from the complaint. chanroblesvirtualawlibrary chanrobles virtual law library
According to the stipulation of facts, the defendants was and is a
corporation organized and existing under the laws of the State of
New York, licensed to engage in business in the Philippines, with
offices in the City of Manila, in Fabrica, Occidental Negros, in New
York and in Philadelphia. The plaintiff was and is the owner and
possessor of 57 shares of the capital stock of the defendant
corporation, registered in his name in the books thereof; that he
does not own three per cent of the total capital stock of the
corporation, nor does he represent stockholders who own three per
cent of its capital; that during the years 1932 and 1933, the plaintiff
asked the offices of the defendant in Manila and in Fabrica to permit
him to examine the books and records of the business of said
defendant, but he was not allowed to do so; that under the law of
New York, the right of a stockholder to examine the books and
records of a corporation organized under the laws of that State,
have been, during the entire period material to this action, only
those provided in section 77 of the Stock Corporation Law, which
reads as follows:

Financial Statement to Stockholders: Stockholders owning three per

centum of the shares of any corporation other than a moneyed
corporation may make a written request to the treasurer or other
fiscal officer thereof for a statement of its affairs, under oath,
embracing a particular account of all its assets and liabilities, and
the treasurer shall make such statement and deliver it to the person
making the request within thirty days thereafter, and keep on file in
the office of the corporation for twelve months thereafter a copy of
such statement, which shall at all times during business hours be
exhibited to any stockholders demanding an examination thereof;
but the treasurer shall not be required to deliver more than one
such statement in any one year. The Supreme Court, or any justice
thereof, may upon application, for good cause shown, extend the
time for making and delivering such statement. For every neglect or
refusal to comply with the provisions of this section the corporation
shall and pay to the person making such request the sum of Fifty
Dollars, and the further sum of ten dollars for every twenty-four
hours thereafter until such statement shall be furnished. (S. C. L.,
sec. 77.)
That neither the plaintiff nor any other stockholder of the defendant
corporation has asked its treasurer or any of its officers for a
statement of its affairs, as provided in the statutes of New York;
neither did the plaintiff ask to be allowed to examine any of the
statements prepared by the defendant corporation and existing in
its files, as provided by the statutes of New York. chanroble svirtualawlibrary chanroble s virtual law library

In the light of the foregoing facts agreed upon by the parties and in
accordance with section 77 of the Stock Corporation Law of New
York which is conceded to be the law that governs the right of a
stockholder to examine the books and papers of a corporation, it is
a question fully settled that the plaintiff not being a stockholder
owning at least three per cent of the capital stock of the defendant
corporation, has no right to examine the books and records of the
corporation nor to require a statement of its affairs embracing a
particular account of its assets and liabilities.
chanroble svirtualawlibrary chanroble s virtual law library

Plaintiff-appellant contends, however, that, in accordance with our

Corporation Law, under which the defendant company was
registered to do business in the Philippines, the plaintiff, as
stockholder, is entitled to inspect the record of the transactions of
the defendant corporation (sec. 51, Act No. 1459, and this right,
which is recognized in the common law, has not been altered by
section 77 of the Stock Corporation Law of New York quoted in the
stipulation of facts, and can be enforced by mandamus. chanroble svirtualawlibrary chanroble s virtual law library

To this, defendant corporation answers, in the first place, that

stipulation of facts is finding upon both parties and cannot be
altered by either of them. (25 R. C. L., 1104, 1105.) In the second
place, on the strength of this principle, plaintiff-appellant is bound
to adhere to the agreement made by him with the defendant
corporation in paragraph four of the stipulation of facts, to the effect
that the rights of a stockholder, under the law of New York, to
examine the books and records of a corporation organized under the
laws of said State, and during the entire period material to this
action, are only those provided in section 77 Stock Corporation Law
of New York. Under this law, plaintiff has the right to be furnished
by the treasurer or other fiscal officer of the corporation with
statement of its affairs embracing a particular account of all its
assets and liabilities. In the third place, inasmuch as plaintiff, either
at the hearing or in his motion for new trial, did not ask to have the
stipulation of facts altered or changed, he cannot now, for the first
time on appeal, raise the question that aside from the right
conferred upon him by section 77 of the Stock Corporation Law of
New York, he also entitled under the common law to examine and
inspect the books and records of the defendant corporation. In the
fourth place, neither can this right under the common law be
granted the defendant in the present case, since the same can only
be granted at the discretion of the court, under certain conditions,
to wit:

( a) That the stockholder of a corporation in New York has the right

to inspect its books and records if it can be shown that he seeks
information for an honest purpose (14 C. J., 853), or to protect his
interest as stockholder. ( In reSteinway, 159 N. Y., 250; 53 N. E.,
1103; 45 L. R. A., 461 [aff. 31 App. Div., 70; 52 N. Y. S., 343]).
law library
chanroblesvirtualawlibrary chanrobles virtual

( b) That said right to examine and inspect the books of the

corporation must be exercised in good faith, for a specific and
honest purpose, and not to gratify curiosity, or for speculative or
vexatious purposes. (14 C. J., 854, 855.)

The appellant has made no effort to prove or even allege that the
information he desired to obtain through the examination and
inspection of defendant's books was necessary to protect his
interests as stockholder of the corporation, or that it was for a
specific and honest purpose, and not to gratify curiosity, nor for
speculative or vexatious purposes. chanroble svirtualawlibrary chanroble s virtual law library

In view of the foregoing, we affirm the judgment of the lower court,

with costs against the appellant. So ordered.

G.R. No. L-2294 May 25, 1951

FILIPINAS COMPAÑIA DE SEGUROS, petitioner,

vs.
CHRISTERN, HUENEFELD and CO., INC., respondent.
Ramirez and Ortigas for petitioner.
Ewald Huenefeld for respondent.

PARAS, C.J.:

On October 1, 1941, the respondent corporation, Christern Huenefeld, & Co., Inc., after payment of
corresponding premium, obtained from the petitioner ,Filipinas Cia. de Seguros, fire policy No.
29333 in the sum of P1000,000, covering merchandise contained in a building located at No. 711
Roman Street, Binondo Manila. On February 27, 1942, or during the Japanese military occupation,
the building and insured merchandise were burned. In due time the respondent submitted to the
petitioner its claim under the policy. The salvage goods were sold at public auction and, after
deducting their value, the total loss suffered by the respondent was fixed at P92,650. The petitioner
refused to pay the claim on the ground that the policy in favor of the respondent had ceased to be in
force on the date the United States declared war against Germany, the respondent Corporation
(though organized under and by virtue of the laws of the Philippines) being controlled by the German
subjects and the petitioner being a company under American jurisdiction when said policy was
issued on October 1, 1941. The petitioner, however, in pursuance of the order of the Director of
Bureau of Financing, Philippine Executive Commission, dated April 9, 1943, paid to the respondent
the sum of P92,650 on April 19, 1943.

The present action was filed on August 6, 1946, in the Court of First Instance of Manila for the
purpose of recovering from the respondent the sum of P92,650 above mentioned. The theory of the
petitioner is that the insured merchandise were burned up after the policy issued in 1941 in favor of
the respondent corporation has ceased to be effective because of the outbreak of the war between
the United States and Germany on December 10, 1941, and that the payment made by the
petitioner to the respondent corporation during the Japanese military occupation was under
pressure. After trial, the Court of First Instance of Manila dismissed the action without
pronouncement as to costs. Upon appeal to the Court of Appeals, the judgment of the Court of First
Instance of Manila was affirmed, with costs. The case is now before us on appeal by certiorari from
the decision of the Court of Appeals.

The Court of Appeals overruled the contention of the petitioner that the respondent corporation
became an enemy when the United States declared war against Germany, relying on English and
American cases which held that a corporation is a citizen of the country or state by and under the
laws of which it was created or organized. It rejected the theory that nationality of private corporation
is determine by the character or citizenship of its controlling stockholders.

There is no question that majority of the stockholders of the respondent corporation were German
subjects. This being so, we have to rule that said respondent became an enemy corporation upon
the outbreak of the war between the United States and Germany. The English and American cases
relied upon by the Court of Appeals have lost their force in view of the latest decision of the Supreme
Court of the United States in Clark vs. Uebersee Finanz Korporation, decided on December 8, 1947,
92 Law. Ed. Advance Opinions, No. 4, pp. 148-153, in which the controls test has been adopted. In
"Enemy Corporation" by Martin Domke, a paper presented to the Second International Conference
of the Legal Profession held at the Hague (Netherlands) in August. 1948 the following enlightening
passages appear:

Since World War I, the determination of enemy nationality of corporations has been
discussion in many countries, belligerent and neutral. A corporation was subject to enemy
legislation when it was controlled by enemies, namely managed under the influence of
individuals or corporations, themselves considered as enemies. It was the English courts
which first the Daimler case applied this new concept of "piercing the corporate veil," which
 was adopted by the peace of Treaties of 1919 and the Mixed Arbitral established after the
First World War.

The United States of America did not adopt the control test during the First World War.
Courts refused to recognized the concept whereby American-registered corporations could
be considered as enemies and thus subject to domestic legislation and administrative
measures regarding enemy property.

World War II revived the problem again. It was known that German and other enemy
interests were cloaked by domestic corporation structure. It was not only by legal ownership
of shares that a material influence could be exercised on the management of the corporation
but also by long term loans and other factual situations. For that reason, legislation on
enemy property enacted in various countries during World War II adopted by statutory
provisions to the control test and determined, to various degrees, the incidents of control.
Court decisions were rendered on the basis of such newly enacted statutory provisions in
determining enemy character of domestic corporation.

The United States did not, in the amendments of the Trading with the Enemy Act during the
last war, include as did other legislations the applications of the control test and again, as in
World War I, courts refused to apply this concept whereby the enemy character of an
American or neutral-registered corporation is determined by the enemy nationality of the
controlling stockholders.

Measures of blocking foreign funds, the so called freezing regulations, and other
administrative practice in the treatment of foreign-owned property in the United States
allowed to large degree the determination of enemy interest in domestic corporations and
thus the application of the control test. Court decisions sanctioned such administrative
practice enacted under the First War Powers Act of 1941, and more recently, on December
8, 1947, the Supreme Court of the United States definitely approved of the control theory. In
Clark vs. Uebersee Finanz Korporation, A. G., dealing with a Swiss corporation allegedly
controlled by German interest, the Court: "The property of all foreign interest was placed
within the reach of the vesting power (of the Alien Property Custodian) not to appropriate
friendly or neutral assets but to reach enemy interest which masqueraded under those
innocent fronts. . . . The power of seizure and vesting was extended to all property of any
foreign country or national so that no innocent appearing device could become a Trojan
horse."

It becomes unnecessary, therefore, to dwell at length on the authorities cited in support of the
appealed decision. However, we may add that, in Haw Pia vs. China Banking Corporation,* 45 Off
Gaz., (Supp. 9) 299, we already held that China Banking Corporation came within the meaning of
the word "enemy" as used in the Trading with the Enemy Acts of civilized countries not only because
it was incorporated under the laws of an enemy country but because it was controlled by enemies.

The Philippine Insurance Law (Act No. 2427, as amended,) in section 8, provides that "anyone
except a public enemy may be insured." It stands to reason that an insurance policy ceases to be
allowable as soon as an insured becomes a public enemy.

Effect of war, generally. — All intercourse between citizens of belligerent powers which is
inconsistent with a state of war is prohibited by the law of nations. Such prohibition includes
all negotiations, commerce, or trading with the enemy; all acts which will increase, or tend to
increase, its income or resources; all acts of voluntary submission to it; or receiving its
protection; also all acts concerning the transmission of money or goods; and all contracts
 relating thereto are thereby nullified. It further prohibits insurance upon trade with or by the
enemy, upon the life or lives of aliens engaged in service with the enemy; this for the reason
that the subjects of one country cannot be permitted to lend their assistance to protect by
insurance the commerce or property of belligerent, alien subjects, or to do anything
detrimental too their country's interest. The purpose of war is to cripple the power and
exhaust the resources of the enemy, and it is inconsistent that one country should destroy its
enemy's property and repay in insurance the value of what has been so destroyed, or that it
should in such manner increase the resources of the enemy, or render it aid, and the
commencement of war determines, for like reasons, all trading intercourse with the enemy,
which prior thereto may have been lawful. All individuals therefore, who compose the
belligerent powers, exist, as to each other, in a state of utter exclusion, and are public
enemies. (6 Couch, Cyc. of Ins. Law, pp. 5352-5353.)

In the case of an ordinary fire policy, which grants insurance only from year, or for some
other specified term it is plain that when the parties become alien enemies, the contractual
tie is broken and the contractual rights of the parties, so far as not vested. lost. (Vance, the
Law on Insurance, Sec. 44, p. 112.)

The respondent having become an enemy corporation on December 10, 1941, the insurance policy
issued in its favor on October 1, 1941, by the petitioner (a Philippine corporation) had ceased to be
valid and enforcible, and since the insured goods were burned after December 10, 1941, and during
the war, the respondent was not entitled to any indemnity under said policy from the petitioner.
However, elementary rules of justice (in the absence of specific provision in the Insurance Law)
require that the premium paid by the respondent for the period covered by its policy from December
11, 1941, should be returned by the petitioner.

The Court of Appeals, in deciding the case, stated that the main issue hinges on the question of
whether the policy in question became null and void upon the declaration of war between the United
States and Germany on December 10, 1941, and its judgment in favor of the respondent corporation
was predicated on its conclusion that the policy did not cease to be in force. The Court of Appeals
necessarily assumed that, even if the payment by the petitioner to the respondent was involuntary,
its action is not tenable in view of the ruling on the validity of the policy. As a matter of fact, the Court
of Appeals held that "any intimidation resorted to by the appellee was not unjust but the exercise of
its lawful right to claim for and received the payment of the insurance policy," and that the ruling of
the Bureau of Financing to the effect that "the appellee was entitled to payment from the appellant
was, well founded." Factually, there can be no doubt that the Director of the Bureau of Financing, in
ordering the petitioner to pay the claim of the respondent, merely obeyed the instruction of the
Japanese Military Administration, as may be seen from the following: "In view of the findings and
conclusion of this office contained in its decision on Administrative Case dated February 9, 1943
copy of which was sent to your office and the concurrence therein of the Financial Department of the
Japanese Military Administration, and following the instruction of said authority, you are hereby
ordered to pay the claim of Messrs. Christern, Huenefeld & Co., Inc. The payment of said claim,
however, should be made by means of crossed check." (Emphasis supplied.)

It results that the petitioner is entitled to recover what paid to the respondent under the
circumstances on this case. However, the petitioner will be entitled to recover only the equivalent, in
actual Philippines currency of P92,650 paid on April 19, 1943, in accordance with the rate fixed in
the Ballantyne scale.

Wherefore, the appealed decision is hereby reversed and the respondent corporation is ordered to
pay to the petitioner the sum of P77,208.33, Philippine currency, less the amount of the premium, in
Philippine currency, that should be returned by the petitioner for the unexpired term of the policy in
question, beginning December 11, 1941. Without costs. So ordered.

G.R. Nos. 79926-27 October 17, 1991

STATE INVESTMENT HOUSE, INC. and STATE FINANCING CENTER, INC., petitioners,
vs.
CITIBANK, N.A., BANK OF AMERICA, NT & SA, HONGKONG & SHANGHAI BANKING
CORPORATION, and the COURT OF APPEALS, respondents.

Roco, Bunag, Kapunan & Migallos for petitioners.

Agcaoili & Associates for Citibank, N.A, and Bank of America NT & SA.

Belo, Abiera & Associates for Hongkong & Shanghai Banking Corp.

NARVASA, J.:p

The chief question in the appeal at bar is whether or not foreign banks licensed to do business in the
Philippines, may be considered "residents of the Philippine Islands" within the meaning of Section 20
of the Insolvency Law (Act No. 1956, as amended, eff. May 20, 1909) reading in part as follows: 1

An adjudication of insolvency may be made on the petition of three or more

creditors, residents of the Philippine Islands, whose credits or demands accrued in
the Philippine Islands, and the amount of which credits or demands are in the
aggregate not less than one thousand pesos: Provided, that none of said creditors
has become a creditor by assignment, however made, within thirty days prior to the
filing of said petition. Such petition must be filed in the Court of First Instance of the
province or city in which the debtor resides or has his principal place of business,
and must be verified by at least three (3) of the petitioners. . . .

The foreign banks involved in the controversy are Bank of America NT and SA, Citibank N.A. and
Hongkong and Shanghai Banking Corporation. On December 11, 1981, they jointly filed with the
Court of First Instance of Rizal a petition for involuntary insolvency of Consolidated Mines, Inc.
(CMI), which they amended four days later. 2 The case was docketed as Sp. Proc. No. 9263 and
assigned to Branch 28 of the Court.

The petition for involuntary insolvency alleged:

1) that CMI had obtained loans from the three petitioning banks, and that as of
November/December, 1981, its outstanding obligations were as follows:

a) In favor of Bank of America (BA) P15,297,367.67

(as of December 10, 1981) US$ 4,175,831.88

 (b) In favor of Citibank US$ 4,920,548.85

(as of December 10, 1981)

c) In favor of Hongkong & Shanghai Bank US$ 5,389,434.12

(as of November 30, 1981); P6,233,969.24

2) that in November, 1981, State Investment House, Inc. (SIHI) and State Financing Center, Inc.
(SFCI) had separately instituted actions for collection of sums of money and damages in the Court of
First Instance of Rizal against CMI, docketed respectively as Civil Cases Numbered 43588 and
43677; and that on application of said plaintiffs, writs of preliminary attachment had been issued
which were executed on "the royalty/profit sharing payments due CMI from Benguet Consolidated
Mining, Inc;" and

3) that CMI had "committed specific acts of insolvency as provided in Section 20 of the Insolvency
Law, to wit:

xxx xxx xxx

5. that he (CMI) has suffered his (CMI's) property to remain under attachment or
legal process for three days for the purpose of hindering or delaying or defrauding his
(CMI's) creditors;

xxx xxx xxx

11. that being a merchant or tradesman he (CMI) has generally defaulted in the
payment of his (CMI's) current obligations for a period of thirty days; . . .

The petition was opposed by State Investment House, Inc. (SIHI) and State Financing Center, Inc.
(SFCI). 3 It claimed that:

1) the three petitioner banks had come to court with unclean hands in that they filed the petition for
insolvency — alleging the CMI was defrauding its creditors, and they wished all creditors to share in
its assets — although a few days earlier, they had "received for the account of CMI substantial
payments aggregating P10,800,000.00;"

2) the Court had no jurisdiction because the alleged acts of insolvency were false: the writs of
attachment against CMI had remained in force because there were "just, valid and lawful grounds for
the(ir) issuance," and CMI was not a "merchant or tradesman" nor had it "generally defaulted in the
payment of (its) obligations for a period of thirty days . . . ;"

3) the Court had no jurisdiction to take cognizance of the petition for insolvency because petitioners
are notresident creditors of CMI in contemplation of the Insolvency Law; and

4) the Court has no power to set aside the attachment issued in favor of intervenors-oppositors SIHI
and SFCI.

CMI filed its Answer to the petition for insolvency, asserting in the main that it was not
insolvent, 4 and later filed a "Motion to Dismiss Based on Affirmative Defense of Petitioner's Lack of
Capacity to Sue," echoing the theory of SIHI and SFCI that the petitioner banks are not "Philippine
residents." 5 Resolution on the motion was "deferred until after hearing of the case on the merits" it
appearing to the Court that the grounds therefor did not appear to be indubitable. 6

SIHI and SFCI filed their own Answer-in-Intervention, 7 and served on the three petitioner banks
requests for admission of certain facts in accordance with Rule 26 of the Rules of Court, 8 receiving a
response only from Hongkong & Shanghai Bank. 9

SIHI and SFCI then filed a Motion for Summary Judgment dated May 23, 1983 "on the ground that,
based on the pleadings and admissions on record, the trial court had no jurisdiction to adjudicate
CMI insolvent since the petitioners (respondent foreign banks) are not "resident creditors" of CMI as
required under the Insolvency Law."10 Oppositions to the motion were filed, 11 to which a reply was
submitted. 12

The Regional Trial Court 13 found merit in the motion for summary judgment. By Order dated
October 10, 1983, it rendered "summary judgment dismissing the . . . petition for lack of jurisdiction
over the subject matter, with costs against petitioners." 14 It ruled that on the basis of the "facts on
record, as shown in the pleadings, motions and admissions of the parties, an insolvency court could
"not acquire jurisdiction to adjudicate the debtor as insolvent if the creditors petitioning for
adjudication of insolvency are not "residents" of the Philippines" — citing a decision of the California
Supreme Court which it declared "squarely applicable especially considering that one of the sources
of our Insolvency Law is the Insolvency Act of California of 1895 . . . " And it declared that since
petitioners had been merely licensed to do business in the Philippines, they could not be deemed
residents thereof.

The three foreign banks sought to take an appeal from the Order of October 10, 1983. They filed a
notice of appeal and a record on appeal. 15 SIHI and SFCI moved to dismiss their appeal claiming it
was attempted out of time. The Trial Court denied the motion.

SIHI and SFCI filed with this Court a petition for certiorari and prohibition (G.R. NO. 66449),
impugning that denial. The Court dismissed the petition and instead required the three banks to file a
petition for review in accordance with Rule 45 of the Rules of Court. 16 This the banks did (their
petition was docketed as G.R. No. 66804). However, by Resolution dated May 16, 1984, the court
referred the petition for review to the Intermediate Appellate Court, where it was docketed as AC SP-
03674. 17

In the meantime, the Trial Court approved on May 3, 1985 the banks' record on appeal and
transmitted it to this Court, where it was recorded as UDK-6866. As might have been expected, this
Court required the banks to file a petition for review under Rule 45, but they asked to be excused
from doing so since they had already filed such a petition, which had been referred to the
Intermediate Appellate Court and was there pending as AC-G.R. No. SP 03674, supra. This Court
then also referred UDK-6866 to the Intermediate Appellate Court where it was docketed as AC-G.R.
No. CV 07830.

Both referred cases, AC-G.R. No. SP 03674 and AC-G.R. No. CV 07830, were consolidated by
Resolution of the Court of Appeals dated April 9, 1986, and Decision thereon was promulgated on
July 14, 1987 by the Fifteenth Division of said Court. 18

The Appellate Court reversed the Trial Court's Order of October 10, 1983 and remanded the case to
it for further proceedings. It ruled:

1) that the purpose of the Insolvency Law was "to convert the assets of the bankrupt in cash for
distribution among creditors, and then to relieve the honest debtor from the weight of oppressive
indebtedness and permit him to start life anew, free from the obligations and responsibilities
consequent upon business misfortunes;" 19 and that it was "crystal clear" that the law was "designed
not only for the benefit of the creditors but more importantly for the benefit of the debtor himself," the
object being "to provide not only for the suspension of payments and the protection of creditors but
also the discharge of insolvent honest debtors to enable them to have a fresh start;"

2) that the Trial Court had placed "a very strained and restrictive interpretation of the term "resident,"
as to exclude foreign banks which have been operating in this country since the early part of the
century," and "the better approach . . . would have been to harmonize the provisions . . . (of the
Insolvency Law) with similar provisions of other succeeding laws, like the Corporation Code of the
Philippines, the General Banking Act, the Offshore Banking Law and the National Internal Revenue
Code in connection with or related to their doing business in the Philippines;"

3) that in light of said statutes, the three banks "are in truth and in fact considered as "residents" of
the Philippines for purposes of doing business in the Philippines and even for taxation matters;"

4) that the banks had "complied with all the laws, rules and regulations (for doing business in the
country) and have been doing business in the Philippines for many years now;" that the authority
granted to them by the Securities and Exchange Commission upon orders of the Monetary Board
"covers not only transacting banking business . . . but likewise maintaining suits "for recovery of any
debt, claims or demand whatsoever," and that their petition for involuntary insolvency was "nothing
more than a suit aimed at recovering a debt granted by them to Consolidated Mines, Inc., or at least
a portion thereof;"

4) that to deprive the foreign banks of their right to proceed against their debtors through insolvency
proceedings would "contravene the basic standards of equity and fair play, . . . would discourage
their operations in economic development projects that create not only jobs for our people but also
opportunities for advancement as a nation;" and

5) that the terms "residence" and "domicile" do not mean the same thing, and that as regards a
corporation, it is generally deemed an "inhabitant" of the state under whose law it is incorporated,
and has a "residence" wherever it conducts its ordinary business, and may have its legal "domicile"
in one place and "residence" in another.

SIHI and SFCI moved for reconsideration and then, when rebuffed, took an appeal to this Court.
Here, they argue that the Appellate Court's judgment should be reversed because it failed to declare
that —

1) the failure of the three foreign banks to allege under oath in their petition for involuntary
insolvency that they are Philippine residents, wishing only to "be considered Philippine residents," is
fatal to their cause;

2) also fatal to their cause is their failure to prove, much less allege, that under the domiciliary laws
of the foreign banks, a Philippine corporation is allowed the reciprocal right to petition for a debtor's
involuntary insolvency;

3) in fact and in law, the three banks are not Philippine residents because:

a) corporations have domicile and residence only in the state of their

incorporation or in the place designated by law, although for limited
 and exclusive purposes, other states may consider them as
residents;

b) juridical persons may not have residence separate from their

domicile;

4) actually, the non-resident status of the banks within the context of the Insolvency Law is
confirmed by other laws;

5) the license granted to the banks to do business in the Philippines does not make them residents;

6) no substantive law explicitly grants foreign banks the power to petition for the adjudication of the
Philippine corporation as a bankrupt;

7) the Monetary Board can not appoint a conservator or receiver for a foreign bank or orders its
liquidation having only the power to revoke its license, subject to such proceedings as the Solicitor
General may thereafter deem proper to protect its creditors;

8) the foreign banks are not denied the right to collect their credits against Philippine debtors, only
the right to "petition for the harsh remedy of involuntary insolvency" not being conceded to them;

9) said banks have come to court with unclean hands, their filing of the petition for involuntary
insolvency being an attempt to defeat validly acquired rights of domestic corporations.

The concept of a foreign corporation under Section 123 of the Corporation Code is of "one formed,
organized or existing under laws other than those of the Philippines and . . . (which) laws allow
Filipino citizens and corporations to do business . . . ." There is no question that the three banks are
foreign corporations in this sence, with principal offices situated outside of the Philippines. There is
no question either that said banks have been licensed to do business in this country and have in fact
been doing business here for many years, through branch offices or agencies, including "foreign
currency deposit units;" in fact, one of them, Hongkong & Shanghai Bank has been doing business
in the Philippines since as early as 1875.

The issue is whether these Philippine branches or units may be considered "residents of the
Philippine Islands" as that term is used in Section 20 of the Insolvency Law, supra, 20 or residents of
the state under the laws of which they were respectively incorporated. The answer cannot be found
in the Insolvency Law itself, which contains no definition of the term, resident, or any clear indication
of its meaning. There are however other statutes, albeit of subsequent enactment and effectivity,
from which enlightening notions of the term may be derived.

The National Internal Revenue Code declares that the term "'resident foreign corporation' applies to
a foreign corporation engaged in trade or business within the Philippines," as distinguished from a "
"non-resident foreign corporation" . . . (which is one) not engaged in trade or business within the
Philippines." 21

The Offshore Banking Law, Presidential Decree No. 1034, states "that branches, subsidiaries,
affiliation, extension offices or any other units of corporation or juridical person organized under the
laws of any foreign country operating in the Philippines shall be considered residents of the
Philippines." 22
The General Banking Act, Republic Act No. 337, places "branches and agencies in the Philippines of
foreign banks . . . (which are) called Philippine branches," in the same category as "commercial
banks, savings associations, mortgage banks, development banks, rural banks, stock savings and
loan associations" (which have been formed and organized under Philippine laws), making no
distinction between the former and the later in so far, as the terms "banking institutions" and "bank"
are used in the Act, 23 declaring on the contrary that in "all matters not specifically covered by special
provisions applicable only to foreign banks, or their branches and agencies in the Philippines, said
foreign banks or their branches and agencies lawfully doing business in the Philippines "shall be
bound by all laws, rules, and regulations applicable to domestic banking corporations of the same
class, except such laws, rules and regulations as provided for the creation, formation, organization,
or dissolution of corporations or as fix the relation, liabilities, responsibilities, or duties of members,
stockholders or officers or corporations." 24

This Court itself has already had occasion to hold 25 that a foreign corporation licitly doing business
in the Philippines, which is a defendant in a civil suit, may not be considered a non-resident within
the scope of the legal provision authorizing attachment against a defendant not residing in the
Philippine Islands;" 26 in other words, a preliminary attachment may not be applied for and granted
solely on the asserted fact that the defendant is a foreign corporation authorized to do business in
the Philippines — and is consequently and necessarily, "a party who resides out of the Philippines."
Parenthetically, if it may not be considered as a party not residing in the Philippines, or as a party
who resides out of the country, then, logically, it must be considered a party who does reside in the
Philippines, who is a resident of the country. Be this as it may, this Court pointed out that:

. . . Our laws and jurisprudence indicate a purpose to assimilate foreign corporations,

duly licensed to do business here, to the status of domestic corporations. (Cf.
Section 73, Act No. 1459, and Marshall Wells Co. vs. Henry W. Elser & Co., 46 Phil.
70, 76; Yu; Cong Eng vs. Trinidad, 47 Phil. 385, 411) We think it would be entirely
out of line with this policy should we make a discrimination against a foreign
corporation, like the petitioner, and subject its property to the harsh writ of seizure by
attachment when it has complied not only with every requirement of law made
specially of foreign corporations, but in addition with every requirement of law made
of domestic corporations. . . . .

Obviously, the assimilation of foreign corporations authorized to do business in the Philippines "to
the status ofdomestic corporations," subsumes their being found and operating as corporations,
hence, residing, in the country.

The same principle is recognized in American law: that the "residence of a corporation, if it can be
said to have a residence, is necessarily where it exercises corporate functions . . . ;" that it is
.considered as dwelling "in the place where its business is done . . . ," as being "located where its
franchises are exercised . . . ," and as being "present where it is engaged in the prosecution of the
corporate enterprise;" that a "foreign corporation licensed to do business in a state is a resident of
any country where it maintains an office or agent for transaction of its usual and customary business
for venue purposes;" and that the "necessary element in its signification is locality of
existence." 27 Courts have held that "a domestic corporation is regarded as having a residence within
the state at any place where it is engaged in the particulars of the corporate enterprise, and not only
at its chief place or home office;" 28 that "a corporation may be domiciled in one state and resident in
another; its legal domicil in the state of its creation presents no impediment to its residence in a real
and practical sense in the state of its business activities." 29

The foregoing propositions are in accord with the dictionary concept of residence as applied to
juridical persons, a term which appears to comprehend permanent as well as temporary residence.
The Court cannot thus accept the petitioners' theory that corporations may not have a residence
(i.e., the place where they operate and transact business) separate from their domicile (i.e., the state
of their formation or organization), and that they may be considered by other states as residents only
for limited and exclusive purposes. Of course, as petitioners correctly aver, it is not really the grant of
a license to a foreign corporation to do business in this country that makes it a resident; the license
merely gives legitimacy to its doing business here. What effectively makes such a foreign
corporation a resident corporation in the Philippines is its actually being in the Philippines and licitly
doing business here, "locality of existence" being, to repeat, the "necessary element in . . . (the)
signification" of the term, resident corporation.

Neither can the Court accept the theory that the omission by the banks in their petition for
involuntary insolvency of an explicit and categorical statement that they are "residents of the
Philippine Islands," is fatal to their cause. In truth, in light of the concept of resident foreign
corporations just expounded, when they alleged in that petition that they are foreign banking
corporations, licensed to do business in the Philippines, and actually doing business in this Country
through branch offices or agencies, they were in effect stating that they are resident foreign
corporations in the Philippines.

There is, of course, as petitioners argue, no substantive law explicitly granting foreign banks the
power to petition for the adjudication of a Philippine corporation as a bankrupt. This is
inconsequential, for neither is there any legal provision expressly giving domestic banks the same
power, although their capacity to petition for insolvency can scarcely be disputed and is not in truth
disputed by petitioners. The law plainly grants to a juridical person, whether it be a bank or not or it
be a foreign or domestic corporation, as to natural persons as well, such a power to petition for the
adjudication of bankruptcy of any person, natural or juridical, provided that it is a resident corporation
and joins at least two other residents in presenting the petition to the Bankruptcy Court.

The petitioners next argue that "Philippine law is emphatic that only foreign corporations whose own
laws give Philippine nationals reciprocal rights may do business in the Philippines." As basis for the
argument they invoke Section 123 of the Corporation Code which, however, does not formulate the
proposition in the same way. Section 123 does not say, as petitioners assert, that it is required that
the laws under which foreign corporations are formed "give Philippine nationals, reciprocal rights."
What it does say is that the laws of the country or state under which a foreign corporation is "formed,
organized or existing . . . allow Filipino citizens and corporations to do business in its own country or
state," which is not quite the same thing. Now, it seems to the Court that there can be no serious
debate about the fact that the laws of the countries under which the three (3) respondent banks were
formed or organized (Hongkong and the United States) do "allow Filipino citizens and corporations to
do business" in their own territory and jurisdiction. It also seems to the Court quite apparent that the
Insolvency Law contains no requirement that the laws of the state under which a foreign corporation
has been formed or organized should grant reciprocal rights to Philippine citizens to apply for
involuntary insolvency of a resident or citizen thereof. The petitioners' point is thus not well taken and
need not be belabored.

That the Monetary Board can not appoint a conservator or receiver for a foreign bank or order its
liquidation having only the power to revoke its license, subject to such proceedings as the Solicitor
General may thereafter deem proper to protect its creditors, which is another point that petitioners
seek to make, is of no moment. It has no logical connection to the matter of whether or not the
foreign bank may properly ask for a judicial declaration of the involuntary insolvency of a domestic
corporation, which is the issue at hand. The fact is, in any event, that the law is not lacking in
sanctions against foreign banks or powerless to protect the latter's creditors.
The petitioners contend, too, that the respondent banks have come to court with unclean hands,
their filing of the petition for involuntary insolvency being an attempt to defeat validly acquired rights
of domestic corporations. The Court wishes to simply point out that the effects of the institution of
bankruptcy proceedings on all the creditors of the alleged bankrupt are clearly spelled out by the
law, and will be observed by the Insolvency Court regardless of whatever motives — apart from the
desire to share in the assets of the insolvent in satisfying its credits — that the party instituting the
proceedings might have.

Still another argument put forth by the petitioners is that the three banks' failure to incorporate their
branches in the Philippines into new banks in accordance with said Section 68 of the General
Banking Act connotes an intention on their part to continue as residents of their respective states of
incorporation and not to be regarded as residents of the Philippines. The argument is based on an
incomplete and inaccurate quotation of the cited Section. What Section 68 required of a "foreign
bank presently having branches and agencies in the Philippines, . . . within one year from the
effectivity" of the General Banking Act, was to comply with any of three (3) options, not merely with
one sole requirement. These three (3) options are the following:

1) (that singled out and quoted by the petitioners, i.e.:) "incorporate its branch or
branches into a new bank in accordance with Philippine laws . . . ; or

2) "assign capital permanently to the local branch with the concurrent maintenance of
a 'net due to' head office account which shall include all net amounts due to other
branches outside the Philippines in an amount which when added to the assigned
capital shall at all times be not less than the minimum amount of capital accounts
required for domestic commercial banks under section twenty-two of this Act;" or

3) "maintain a "net due to" head office account which shall include all net amounts
due to other branches outside the Philippines, in an amount which shall not be less
than the minimum amount of capital accounts required for domestic commercial
banks under section twenty-two of this Act."

The less said about this argument then, the better.

The petitioners allege that three days before respondent banks filed their petition for involuntary
insolvency against CMI, they received from the latter substantial payments on account in the
aggregate amount of P6,010,800.00, with the result that they were "preferred in the distribution of
CMI's assets thereby defrauding other creditors of CMI." Non sequitur. It is in any case a
circumstance that the Bankruptcy Court may well take into consideration in determining the manner
and proportion by which the assets of the insolvent company shall be distributed among its creditors;
but it should not be considered a ground for giving the petition for insolvency short shrift. Moreover,
the payment adverted to does not appear to be all that large. The total liabilities of CMI to the three
respondent banks as of December, 1981 was P21,531,336.91, and US$14,485,814.85. Converted
into Philippine currency at the rate of P7.899 to the dollar, the average rate of exchange during
December, 1981, 30the dollar account would be P114,423,451.50. Thus, the aggregate liabilities of
CMI to the banks, expressed in Philippine currency, was P135,954,788.41 as of December, 1981,
and therefore the payment to them of P6,010,800.00 constituted only some 4.42% of the total
indebtedness.

WHEREFORE, the petition is DENIED and the challenged Decision of the Court of Appeals is
AFFIRMED in toto, with costs against the petitioners.

SO ORDERED.
Griño-Aquino and Medialdea, JJ., concur.

Cruz, J., took no part.

G.R. No. L-11796 August 5, 1918

In the matter of estate of Samuel Bischoff Werthmuller. ANA M. RAMIREZ, executrix-appellant,

vs.
OTTO GMUR, as guardian of the minors Esther Renate Mory, Carmen Maria Mory, and
Leontina Elizabeth, claimant-appellant.

C. Lozano for executrix-appellant.

Thos. D. Aitken for claimant-appellant.

STREET, J.:

Samuel Bischoff Werthmuller, native of the Republic of Switzerland, but for many years a resident of
the Philippine Islands, died in the city of Iloilo on June 29, 1913, leaving a valuable estate of which
he disposed by will. A few days after his demise the will was offered for probate in the Court of First
Instance of Iloilo and, upon publication of notice, was duly allowed and established by the court. His
widow, Doña Ana M. Ramirez, was named as executrix in the will, and to her accordingly letters
testamentary were issued. By the will everything was given to the widow, with the exception of a
piece of real property located in the City of Thun, Switzerland, which was devised to the testator's
brothers and sisters.

The first cause of the will contains a statement to the effect that inasmuch as the testator had no
children from his marriage with Ana M. Ramirez he was therefore devoid of forced heirs. In making
this statement the testator ignored the possible claims of two sets of children, born to his natural
daughter, Leona Castro.

The pertinent biographical facts concerning Leona Castro are these: As appears from the original
baptismal entry made in the church record of Bacolod, she was born in that pueblo on April 11,
1875, her mother being Felisa Castro, and father "unknown." Upon the margin of this record there is
written in Spanish an additional annotation of the following tenor: "According to a public document
(escritura) which was exhibited, she was recognized by Samuel Bischoff on June 22, 1877." This
annotation as well as the original entry is authenticated by the signature of Father Ferrero, whose
deposition was taken in this case. He testifies that the work "escritura" in this entry means a public
document; and he says that such document was exhibited to him when the marginal note which has
been quoted was added to the baptismal record and supplied the basis for the annotation in
question.

As the years passed Leona Castro was taken into the family of Samuel Bischoff and brought up by
him and his wife a a member of the family; and it is sufficiently shown by the evidence adduced in
this case that Samuel Bischoff tacitly recognized Leona a his daughter and treated her as such. In
the year 1895 Leona Castro was married to Frederick von Kauffman, a British subject, born in Hong
Kong, who had come to live in the city of Iloilo. Three children were born of this marriage, namely,
Elena, Federico, and Ernesto, the youngest having been born on November 10, 1898. In the month
of April 1899, Leona Castro was taken by her husband from Iloilo to the City of Thun, Switzerland,
for the purpose of recuperating her health. She was there placed in a sanitarium, and on August
20th the husband departed for the Philippine Islands, where he arrived on October 10, 1899.
Leona Castro continued to remain in Switzerland, and a few years later informed her husband,
whom she had not seen again, that she desired to remain free and would not resume life in common
with him. As a consequence, in the year 1904, Mr. Kauffman went to the City of Paris, France, for
the purpose of obtaining a divorce from his wife under the French laws; and there is submitted in
evidence in this case a certified copy of an extract from the minutes of the Court of First Instance of
the Department of the Seine, from which it appears that a divorce was there decreed on January 5,
1905, in favor of Mr. Kauffman and against his wife, Leona, in default. Though the record recites that
Leona was then in fact residing at No. 6, Rue Donizetti, Paris, there is no evidence that she had
acquired a permanent domicile in that city.

The estrangement between the von Kauffman spouses is explained by the fact that Leona Castro
had become attracted to Dr. Ernest Emil Mory, the physician in charge of the sanatorium in
Switzerland where she was originally placed; and soon after the decree of divorce was entered, as
aforesaid, Doctor Mory and Leona Castro repaired to the City of London, England, and on May 5,
1905, in the registrar's office in the district of Westminster, went through the forms of a marriage
ceremony before an officer duly qualified to celebrate marriage under the English law. It appears that
Doctor Mory himself had been previously married to one Helena Wolpman, and had been divorced
from her; but how or under what circumstances this divorce had been obtained does not appear.

Prior to the celebration of this ceremony of marriage a daughter, named Leontina Elizabeth, had
been born (July 21, 1900) to Doctor Mory and Leona Castro, in Thun, Switzerland. On July 2, 1906,
a second daughter, named Carmen Maria, was born to them in Berne, Switzerland, now the place of
their abode; and on June 10, 1909, a third daughter was born, name Esther. On October 6, 1910,
the mother died.

In the present proceedings Otto Gmur has appeared as the guardian of the three Mory claimants,
while Frederick von Kauffman has appeared as the guardian of his own three children, Elena,
Federico, and Ernesto.

As will be surmised from the foregoing statement, the claims of both sets of children are founded
upon the contention that Leona Castro was the recognized natural daughter of Samuel Bischoff and
that as such she would, if living, at the time of her father's death, have been a forced heir of his
estate and would have been entitled to participate therein to the extend of a one-third interest. Ana
M. Ramirez, as the widow of Samuel Bischoff and residuary legatee under his will, insists — at least
as against the Mory claimants, — that Leona Castro had never been recognized at all by Samuel
Bischoff.

In behalf of Leontina, the oldest of the Mory claimants, it was originally insisted in the court below,
that, having been born while her mother still passed as the wife of Frederick von Kauffman, she was
to be considered as a legitimate daughter of the wedded pair. This contention has been abandoned
on this appeal a untenable; and it is now contended here merely that, being originally the illegitimate
daughter of Doctor Mory and Leona Castro, she was legitimated by their subsequent marriage.

In behalf of Carmen Maria and Esther Renate, the two younger of the Mory claimants, it is argued
that the bonds of matrimony which united Frederick von Kauffman and Leona Castro were dissolved
by the decree of divorce granted by the Paris court on January 5, 1905; that the marriage ceremony
which was soon thereafter celebrated between Doctor Mory and Leona in London was in all respects
valid; and that therefore these claimants are to be considered the legitimate offspring of their mother.

In behalf of the children of Frederick von Kauffman it is insisted that the decree of divorce was wholly
invalid, that all three of the Mory children are the offspring of adulterous relations, and that the von
Kauffman children, as the legitimate offspring of Leona Castro, are alone entitled to participate in the
division of such part of the estate of Samuel Bischoff as would have been inherited by their mother, if
living.

We are of the opinion that the status of Leona Castro as recognized natural daughter of Samuel
Bischoff is fully and satisfactorily shown. It is proved that prior to her marriage with Frederick von
Kauffman she was in an uninterrupted enjoyment of the de facto status of a natural child and was

treated as such by Samuel Bischoff and his kindred. The proof of tacit recognition is full and
complete.

From the memorandum made by Padre Ferrero in the record of the birth, as well as from the
testimony of this priest, taken upon the deposition, it also appears that Samuel Bischoff had
executed a document, authenticated by a notarial act, recognizing Leona as his daughter, that said
document was presented to the priest, as custodian of the church records, and upon the faith of that
document the marginal note was added to the baptismal record, showing the fact of such
recognition. The original document itself was not produced in evidence but it is shown that diligent
search was made to discover its whereabouts, without avail. This was sufficient to justify the
introduction of secondary evidence concerning its contents; and the testimony of the priest show that
the fact of recognition was therein stated. Furthermore, the memorandum in the baptismal record
itself constitutes original and substantive proof of the facts therein recited.

It will be observed that the recognition of Leona Castro as the daughter of Samuel Bischoff occurred
prior to the date when the Civil Code was put in force in these Islands; and consequently her rights
as derived from the recognition must be determined under the law as it then existed, that is, under
Law 11 of Toro, which afterwards became Law 1, title 5, book 10, of the Novisima Recopilacion.
(See Capistrano vs. Estate of Gabino, 8 Phil., 135, 139, where this statute is quoted in the opinion
written by Mr. Justice Torres.) Under that law recognition could be established by proof of acts on
the part of the parent unequivocally recognizing the status of his offspring. (Cosiovs. Pili, 10 Phil.,
72, 77.) In other words at tacit recognition was sufficient. Under article 131 of the present Civil Code,
the acknowledgment of a natural child must be made in the record of birth, by will, or in other public
instrument. We are of the opinion that the recognition of Leona Castro is sufficiently shown whether
the case be judged by the one provision or the other.

But it is contended by counsel for Doña Ana Ramirez that only children born of persons free to marry
may possess the status of recognized natural children, and there is no evidence to show that Felisa
Catro was either a single woman or widow at the time of the conception or birth of Leona. In the
absence of proof to the contrary, however, it must be presumed that she was a single woman or a
widow.

Relative to this presumption of the capacity of the parents to marry, the author Sanchez Roman
makes the following comment:

Furthermore, viewing the conception of natural child in connection with two mutually
interrelated circumstances, to wit, the freedom of the parents to intermarry, with or without
dispensation, at the time of the conception of the offspring stigmatized as natural, the first of
these, or freedom to marry, is a point upon which there is, according to the jurisprudence of
our former law, whose spirit is maintained in the Code, an affirmative presumption which
places the burden of proving the contrary upon those who are interested in impugning the
natural filiation. (Vol. 5, Derecho Civil, pp. 1018-1019.)

The contrary presumption would be that Felisa Castro was guilty of adultery, which cannot be
entertained. If such had in fact been the case, the burden of proving it would have been upon the
persons impugning the recognition of the child by her father. (Sec. 334, par. 1, Code of Civil
Procedure.)

From the fact that Leona Castro was an acknowledged natural daughter of her father, it follows that
had she survived him she would have been his forced heir, he having died after the Civil Code took
effect. (Civil Code, article 807 [3], art. 939; Civil Code, first transitory disposition); and as such forced
heir she would have been entitled to one-third of the inheritance (art. 842, Civil Code).

With reference to the right of the von Kauffman children, it is enough to say that they are legitimate
children, born to their parents in lawful wedlock; and they are therefore entitled to participate in the
inheritance which would have devolved upon their mother, if he had survived the testator.

As regards the Mory claimants, it is evident that their rights principally depend upon the effect to be
given by this court to the decree of divorce granted to von Kauffman by the Court of First Instance of
the City of Paris. If this decree is valid, the subsequent marriage of Doctor Mory and Leona Castro
must also be conceded to be valid; and as a consequence the two younger children, born after said
marriage, would be the legitimate offspring of their mother, and would be entitle to participate in their
mother's portion of Mr. Bischoff's estate. With respect to Leontina Elizabeth, the older one of the
Mory claimants, there would in the case still be the insuperable obstacle which results from the fact
that she was the offspring of adulterous intercourse and a such was incapable of legitimation (art.
119, Civil Code).

We are of the opinion that the decree of divorce upon which reliance is placed by the representation
of the Mory children cannot be recognized as valid in the courts of the Philippine Islands. The French
tribunal has no jurisdiction to entertain an action for the dissolution of a marriage contracted in these
Islands by person domiciled here, such marriage being indissoluble under the laws then prevailing in
this country.

The evidence shows conclusively that Frederick von Kauffman at all times since earliest youth has
been, and is now, domiciled in the city of Iloilo in the Philippine Islands; that he there married Leona
Castro, who was a citizen of the Philippine Islands, and that Iloilo was their matrimonial domicile;
that his departure from iloilo for the purpose of taking his wife to Switzerland was limited to that
purpose alone, without any intent to establish a domicile elsewhere; and finally that he went to Paris
in 1904, for the sole purpose of getting a divorce, without any intention of establishing a permanent
residence in that city. The evidence shows that the decree was entered against the defendant in
default, for failure to answer, and there is nothing to show that she had acquired, or had attempted to
acquire, a permanent domicile in the City of Paris. It is evident of course that the presence of both
the spouses in that city was due merely to the mutual desire to procure a divorce from each other.

It is established by the great weight of authority that the court of a country in which neither of the
spouses is domiciled and to which one or both of them may resort merely for the purpose of
obtaining a divorce has no jurisdiction to determine their matrimonial status; and a divorce granted
by such a court is not entitled to recognition elsewhere. (See Note to Succession of Benton, 59 L. R.
A., 143.) The voluntary appearance of the defendant before such a tribunal does not invest the court
with jurisdiction. (Andrews vs. Andrews, 188 U. S., 14; 47 L. ed., 366.)

It follows that, to give a court jurisdiction on the ground of the plaintiff's residence in the State or
country of the judicial forum, his residence must be bona fide. If a spouse leaves the family domicile
and goes to another State for the sole purpose of obtaining a divorce, and with no intention of
remaining, his residence there is not sufficient to confer jurisdiction on the courts of that State. This
is especially true where the cause of divorce is one not recognized by the laws of the State of his
own domicile. (14 Cyc., 817, 818.)
As have been well said by the Supreme Court of the United States marriage is an institution in the
maintenance of which in its purity the public is deeply interested, for it is the foundation of the family
and of society, without which there could be neither civilization nor progress. (Maynard vs. Hill, 125
U. S., 210; 31 L. ed., 659.) Until the adoption of Act No. 2710 by the Philippine Legislature (March
11, 1917), it had been the law of these Islands that marriage, validly contracted, could not be
dissolved absolutely except by the death of one of the parties; and such was the law in this
jurisdiction at the time when the divorce in question was procured. The Act to which we have
referred permits an absolute divorce to be granted where the wife has been guilty of adultery or the
husband of concubinage. The enactment of this statute undoubtedly reflect a change in the policy of
our laws upon the subject of divorce, the exact effect and bearing of which need not be here
discussed. But inasmuch as the tenets of the Catholic Church absolutely deny the validity of
marriages where one of the parties is divorced, it is evident that the recognition of a divorce obtained
under the conditions revealed in this case would be as repugnant to the moral sensibilities of our
people as it is contrary to the well-established rules of law.

As the divorce granted by the French court must be ignored, it results that the marriage of Doctor
Mory and Leona Castro, celebrated in London in 1905, could not legalize their relations; and the
circumstance that they afterwards passed for husband and wife in Switzerland until her death is
wholly without legal significance. The claims of the Mory children to participate in the estate of
Samuel Bischoff must therefore be rejected. The right to inherit is limited to legitimate, legitimated,
and acknowledged natural children. The children of adulterous relations are wholly excluded. The
word "descendants," as used in article 941 of the Civil Code cannot be interpreted to include
illegitimates born of adulterous relations.

An important question arises in connection with the time within which the claims of the two sets of
children were presented to the court. In this connection it appears that the will of Samuel Bischoff
was probated in August, 1913. A committee on claims was appointed and it report was field and
accepted February 20, 1914. About the same time Otto Gmur entered an appearance for the Mory
claimants and petitioned the court to enter a decree establishing their right to participate in the
distribution of the estate. The executrix, Doña Ana Ramirez, answered the petition denying that said
minors were the legitimate children of Leona Castro and further denying that the latter was the
recognized natural daughter of Samuel Bischoff. Upon the issues thus presented a trial was had
before the Honorable Fermin Mariano, and on December 29, 1915, he rendered a decision in which
he held (1) that Leona Castro was the recognized natural daughter of Samuel Bischoff; (2) that the
minor, Leontina Elizabeth, is a legitimate daughter of Leona Castro; and (3) that the minors Carmen
Maria and Esther Renate are illegitimate children of Leona Castro.

From these facts the court drew the conclusion that Leontina Elizabeth was entitled to one-third of
the estate of the late Samuel Bischoff, and that his widow, Doña Ana Ramirez, was entitled to the
remaining two-thirds. From this decision both Doña Ana Ramirez and Otto Gmur, as guardian,
appealed.

Shortly after the appeals above-mentioned were taken, Mr. Frederick von Kauffman made
application to the Court of First Instance of Iloilo by petition filed in the proceedings therein pending
upon the estate of the late Samuel Bischoff for appointment as guardian ad litem of his minor
children, the von Kauffman heirs, which petition was granted by order dated March 4, 1916.
Thereafter, on April 1, 1916, von Kauffman, on behalf of the said minors, filed in the cause a petition
setting forth their right to share in the estate. This petition was answered by Mr. Otto Gmur,
guardian, on April 26, 1916, the sole contention of said answer being that the matter to which the
petition relates had been disposed of by the decision of the Court of First Instance rendered in said
proceedings by Judge Mariano on December 9, 1915. Doña Ana Ramirez answered denying all the
allegations of von Kauffman's petition.
The trial of the petition of von Kauffman, as guardian, came on for hearing before the Court of First
Instance of Iloilo on the 10th day of August, 1916. Upon the evidence taken at that hearing the
Honorable J. S. Powell, as judge then presiding in the Court of First Instance of Iloilo, rendered a
decision under date of November 14, 1916, in which he found as a fact Leona Castro was the
acknowledged natural daughter of Samuel Bischoff and that the minors, Elena, Fritz, and Ernesto,
are the legitimate children of Frederick von Kauffman and the said Leona Castro, born in lawful
wedlock. Upon the facts so found, Judge Powell based his conclusion that all that portion of the
estate of Samuel Bischoff pertaining to Leona Castro should be equally divided among the children
Federico, Ernesto, and Elena, thereby excluding by inference the Mory claimants from all
participation in the estate.

From this judgments an appeal was taken by Mr. Otto Gmur as guardian, no appeal having taken by
Doña Ama Ramirez.

Though the circumstance is now of no practical importance, it may be stated in passing that the
appeals of Doña Ana Ramirez and of Otto Gmur, guardian, from the decision of Judge Mariano of
December 9, 1915, and the appeal of Otto Gmur, guardian from the decision of Judge Powell, of
November 14, 1916, were brought to this court separately; but the causes were subsequently
consolidated and have been heard together. The parties to the litigation have also stipulated that all
the "evidence, stipulations and admissions in each of the two proceedings above-mentioned may be
considered for all purposes by this court in the other." The case is therefore considered here as
though there had been but one trial below and all the issues of law and fact arising from the
contentions of the oppossing claimants had been heard at the same time.

Upon the facts above stated it is insisted for Ana M. Ramirez that her rights to the estate under the
will of Samuel Bischoff were at the latest determined by the final decree of December 29, 1915; and
that it was thereafter incompetent for the court to take cognizance of the application of the Mory
claimants. If this contention is sustainable, the same considerations would operate to defeat the later
application filed on behalf of the von Kauffman children — and indeed with even greater force, —
since this application was not made until the appeals from the decree of December 9, 1915, had
actually been perfected and the cause had been transferred to the Supreme Court.

Two questions are here involved, one as to the effect of the probate of a will upon the rights of
forced heirs who do not appear to contest the probate, and the other as to the conclusiveness and
finality of an order for the distribution of an estate, as against persons who are not before the court.

Upon the first of these questions it is enough to say that the rights of forced heirs to their legitime are
not divested by the decree admitting a will to probate, — and this regardless of the fact that no
provision has been made for them in the will, for the decree of probate is conclusive only a regards
the due execution of the will, the question of its intrinsic validity not being determined by such
decree. (Code of Civil Procedure, sec. 625; Castañeda vs.Alemany, 3 Phil., 426; Sahagun vs. De
Gorostiza, 7 Phil., 347; JocSoy vs. Vaño, 8 Phil., 119; Limjuco vs. Ganara, 11 Phil., 393, 395;
Austria vs. Ventenilla, 21 Phil., 180.)

Indeed it is evident, under the express terms of the proviso to section 753 of the Code of Civil
Procedure, that the forced heirs cannot be prejudiced by the failure of the testator to provide for
them in his will; and regardless of the intention of the testator to leave all his property, or practically
all of it, to his wife, the will is intrinsically invalid so far a it would operate to cut off their rights.

The question as to the conclusiveness of the order of distribution can best be considered with
reference to the von Kauffman children, as the solution of the problem as to them necessarily
involves the disposition of the question as to the Mory claimants.
It is evident that the von Kauffman children cannot be considered to have been in any sense parties
to the proceeding at the time Judge Mariano rendered his decision. So far a the record shows the
court was then unaware even of their existence. No notice of any kind was served upon them; nor
was any person then before the court authorized to act in their behalf. Nevertheless, as we have
already shown, upon the death of Samuel Bischoff, the right to participate in his estate vested
immediately in this children, to the extent to which their mother would have been entitled to
participate had she survived her father. If the right vested upon the death of Samuel Bischoff, how
has it been since divested?

The record shows that the decision of December 29, 1915, in which Judge Mariano holds that the
estate should be divided between Leontina Elizabeth and the residuary legatee Doña Ana Ramirez,
was made without publication of notice, or service of any kind upon other persons who might
consider themselves entitled to participate in the estate.

The law in force in the Philippine Islands regarding the distribution of estates of deceased persons is
to be found in section 753 et seq., of the Code of Civil Procedure. In general terms the law is that
after the payment of the debts and expenses of administration the court shall distribute the residue
of the estate among the persons who are entitled to receive it, whether by the terms of the will or by
operation of law. It will be noted that while the law (sec. 754) provides that the order of distribution
may be had upon the application of the executor or administrator, or of a person interested in the
estate, no provision is made for notice, by publication or otherwise, of such application. The
proceeding, therefore, is to all intents and purposes ex parte. A will be seen our law is very vague
and incomplete; and certainly it cannot be held that a purely ex parte proceeding, had without notice
by personal service or by publication, by which the court undertakes to distribute the property of
deceased persons, can be conclusive upon minor heirs who are not represented therein.

Section 41 of the Code of Civil Procedure provides that ten years actual adverse possession by
"occupancy, grant, descent, or otherwise' shall vest title in the possessor. This would indicate that a
decree of distribution under which one may be placed in possession of land acquired by descent, is
not in itself conclusive, and that, a held in Layre vs. Pasco (5 Rob. [La.], 9), the action of
revindication may be brought by the heir against the persons put in possession by decree of the
probate court at any time within the period allowed by the general statute of limitations.

Our conclusion is that the application of the von Kauffman children was presented in ample time and
that the judgment entered in their favor by Judge Powell was correct. The Mory claimants, as
already stated, are debarred from participation in the estate on other grounds.

So much of the judgment entered in the Court of First Instance, pursuant to the decision of Judge
Mariano of December 29, 1915, as admits Leontina Elizabeth Mory to participate in the estate of
Samuel Bischoff is reversed; and instead the von Kauffman children will be admitted to share equally
in one-third of the estate as provided in the decision of Judge Powell of November 14, 1916. In other
respects the judgment of Judge Mariano is affirmed. The costs of this instance will be paid out of the
estate. So ordered.

Ingenohl vs olsen

This is a suit to recover the costs adjudged to the plaintiff, the petitioner here, in a former suit
that was brought by him against the defendant in the British Colony of Hongkong and was
determined in his favor by the Supreme Court there. The judgment declared the plaintiff to be
the owner of certain trade-marks and trade-names and entitled to the exclusive use of them in
connection with his business as a cigar manufacturer. It restrained the defendants from selling
cigars under these trade-marks and awarded the costs now sued for. The Court of First Instance
of Manila gave judgment for the plaintiff. On appeal the Supreme Court of the Philippine Islands
reversed this decision on the ground that by section 311(2) of the Code of Civil Procedure a
judgment against a person 'may be repelled by evidence of a want of jurisdiction, want of notice
to the party, collusion, fraud or clear mistake of law or fact,' and that the judgment of the
Supreme Court of Hongkong showed such a clear mistake.

The supposed mistake consisted in denying effect in Hongkong to a sale of business and
trade-marks by the Alien Property Custodian to the defendant, the circumstances and nature of
which may be stated in few words so far as they concern the present case. The plaintiff Ingenohl
had built up a great business as a cigar manufacturer and exporter having his factory at Manila.
In 1908 he established a factory at Hongkong and thereafter goods from both factories were sold
under the same trade-marks, the outside box or package of the Hongkong goods having a label
indicating that they came from there. The trade-marks were registered in Hongkong and the
cigars covered by them had acquired a reputation. In 1918 the Alien Property Custodian seized
and sold all the property 'wheresoever situate in the Philippine Islands * * * including the
business as going concern, and the good will, trade-names and trade-marks thereof, of Syndicat
Oriente,' being the above mentioned business of the plaintiff in the Philippines. The Supreme
Court of the Philippines held that it was plain error in the Supreme Court of the British Colony
to hold that this sale did not carry the exclusive right to use the trade-marks in the latter place.

A trade-mark started elsewhere would depend for its protection in Hongkong upon the law
prevailing in Hongkong and would confer no rights except by the consent of that law. Hanover
Star Milling Co. v. Metcalf, 240 U. S. 403, 36 S. Ct. 357, 60 L. Ed. 713, United Drug Co. v.
Theodore Rectanus Co., 248 U. S. 90, 39 S. Ct. 48, 63 L. Ed. 141. When then the judge who, in
the absence of an appeal to the Privy Council, is the final exponent of that law, authoritatively
declares that the assignment by the Custodian of the assets of the Manila firm cannot and will
not be allowed to affect the rights of the party concerned in Hongkong, we do not see how it is
possible for a foreign Court to pronounce his decision wrong. It will be acted on and settles the
rights of the parties in Hongkong and in view of that fact it seems somewhat paradoxical to say
that it is not the law. If the Alien Property Custodian purported to convey rights in English
territory valid as against those whom the English law protects he exceeded the powers that were
or could be given to him by the United States.

It is not necessary to consider whether the section of the Code of Civil Procedure relied upon
was within the power of the Philippine Commission to pass. In any event as interpreted it
involved delicate considerations of international relations and therefore we should not hold
ourselves bound to that deference that we show to the judgment of the local Court upon matters
of only local concern. We are of opinion that whatever scope may be given to the section it is far
from warranting the refusal to enforce this English judgment for costs, obtained after a fair trial
before a court having jurisdiction of the parties, when the judgment is unquestionably valid and
in other respects will be enforced. Of course a foreign state might accept the Custodian's transfer
as good within its jurisdiction, if there were no opposing local interest or right, and that may be
the fact for China outside of Hongkong as seems to have been held in another case not yet finally
disposed of, but no principle requires the transfer to be given effect outside of the United States
and when as here it has been decided to have been ineffectual it is unnecessary to inquire
whether in the other event the Alien Property Custodian was authorized by the statute to use or
did use in fact words purporting to have that effect, or what the effect, if any, would be.
 Some question was made of the jurisdiction of this Court. The jurisdiction was asserted, at
least provisionally, when the writ of certiorari was granted. There are few cases in which it is
more important to maintain it, and we confirm it now. The validity of the section of the Code of
Civil Procedure is drawn in question, and also the construction of the Trading with the Enemy
Act (Comp. St. §§ 3115 1/2 a-3115 1/2 j) which is treated as purporting to authorize what in our
opinion it could not authorize if it tried.

Judgment reversed.

G.R. No. L-20169 February 26, 1965

IN THE MATTER OF THE PETITION OF YU KIAN CHIE TO BE ADMITTED A CITIZEN OF THE

PHILIPPINES.
YU KIAN CHIE, petitioner-appellee,
vs.
REPUBLIC OF THE PHILIPPINES, oppositor-appellant.

R. L. Rabayon for petitioner-appellee.

Office of the Solicitor General for oppositor-appellant.

PAREDES, J.:

Yu Kian Chie, a citizen of the Republic of China, presented with the CFI of Manila, on February 4,
1960, a petition for naturalization, containing all the jurisdictional requirements, the pertinent portion
of which is hereby reproduced:

THIRD.— My trade or profession is that of an employee in which I have been engaged since
1957 and from which I derive an average annual income of P3,000.00.

Attached to the petition were affidavits of Marcelo de la Cruz and Federico G. Santos, who acted as
character witnesses; Declaration of Intention and Certificate of Arrival. After the trial, the Office of the
Solicitor General on October 4, 1961, filed an "Opposition" claiming that the two witnesses of
petitioner are not credible and did not testify as to petitioner's good reputation and moral
irreproachability.

On December 18, 1961, the lower court rendered a decision, the dispositive portion of which states:

xxx xxx xxx

In view of the foregoing, this Court finds that petitioner has all the qualifications required by, and
none of the disqualifications specified in, Commonwealth Act No. 473, as amended by
Commonwealth Act No. 535, and has complied with all the requisites established therein..

WHEREFORE, the said petition of Yu Kian Chie to be admitted a citizen of the Philippines is
hereby granted, and let the proper naturalization certificate be issued in his favor and the
registration thereof in the proper civil registry, this decision to become executory in
accordance with the provisions of Section 1 of Republic Act No. 53.
After the Solicitor General has perfected his appeal from the above judgment, but during the
pendency of the approval of the record on appeal, petitioner-appellee herein presented with the
lower court a "Motion to Reopen Case to Enable Petitioner to present Additional Documentary Proof
of his Income," claiming that his income has risen from P3,000.00 in 1957, to P5,100.00 in 1960 and
P5,200.00 in 1961. The increase in the income had been due to a little increase in the salary, plus,
the bonuses of P100.00 in 1960 and P1,000.00 in 1961. The motion was heard, and on July 18,
1962, the court a quo rendered a "Supplemental Decision." Both the original and the supplemental
decisions are the subjects of the instant appeal, the Solicitor General urging a reversal thereof on a
singular assignment of error, allegedly committed by the court a quo, to wit: in not finding that the
petitioner failed to prove that he has a lucrative income.

There seem to be no question regarding the fact that there has been an increase in the income of
petitioner, from the time he presented his petition, to the rendition of the Supplemental Decision. In
1961 also, there has been a change in the status of petitioner, from single to married. Even granting,
for purposes of argument, that the figures appearing in the documentary evidence submitted are
correct, although We entertain serious doubts regarding their veracity — a point which We will
discuss later — the overriding issue would be, the same lucrative income. As a starter on this point,
We quote a portion of the argument of counsel for petitioner-appellee, which states:

... . He received a uniform living allowance of P150.00 a month, aside from the yearly bonus
which the company gives him, depending of course, on the profit which said company
realizes every year from its business. (p. 3, brief.)

And the living allowance is given regularly from the time the petitioner started working with
the Republic Hardware in 1959 up to the present. In other words, it (living allowance) has
assumed its regularity as a part of the salary in consideration of the services rendered by the
petitioner. ...

The above-quoted portion of the arguments of petitioner's counsel is a clear indication that as far as
salary is concerned, his client, appellee herein, was only receiving P150.00, the rest being in the
form of allowances and bonuses which may or may not be given to appellee. In other words,
petitioner's employer was not duty bound to give such allowances and bonuses, but must spring
from purely voluntary actuations, conditioned to the circumstance that the employer was making
profits. When there are no profits, the allowances and the bonuses are not given. It is not, therefore,
safe to consider that the income of petitioner is P3,000.00 yearly, or more. Insofar as the evidence is
concerned, it becomes indisputable that petitioner's true income is only P150.00, any additional
thereof being purely contingent, accidental or incidental, which amount does not come up to the
category of a lucrative income, considering that the petitioner is now a married man. 1äwphï1.ñët

Furthermore, We are not convinced that petitioner's employee could be that generous to him. It will
be noted that the Republic Hardware did not present its books to show that it was making a good
profit, as to enable it to give such big allowance and bonus to appellee, and considering that the
raise in salary was given during the pendency of his naturalization case.

But even granting, for purpose of argument, that petitioner started to receive a fixed salary of
P400.00 a month in 1962, still this amount cannot be considered lucrative in the face of the fact that
in 1961 he got married, as pointed out in his Income Tax Return for 1961 (Exh. P-4).

PREMISES CONSIDERED, the decision appealed from, should be, as it is hereby reversed and
another entered denying Yu Kian Chie's petition for Philippine citizenship. Costs against petitioner-
appellee.