RULE 91: ESCHEAT

G.R. No. L-45460

February 25, 1938

THE MUNICIPAL COUNCIL OF SAN PEDRO, LAGUNA, ET AL., applicantsappellants,

vs.
COLEGIO DE SAN JOSE, INC., ET AL., oppositors-appellees.
Juan S. Rustia for appellants.
Araneta, Zaragoza and Araneta for appellee Colegio de San Jose, Inc.
Francisco Alfonso for appellee Young.
IMPERIAL, J.:
This is an appeal from the order of the Court of First Instance of Laguna of
October 29, 1936, which denied the applicants motion questioning the
appearance and intervention in the case of the oppositors Colegio de San Jose
and Carlos Young, and from the resolution of the 30th of the same month which
denied the petition for escheat filed by the said petitioners, with the costs against
the latter.
This case was commenced in the said by a petition filed by the petitioners in
behalf of the municipality of San Pedro, Province of Laguna, wherein they claim
the Hacienda de San Pedro Tunasa by the right of escheat. The Colegio de San
Jose, Inc., appeared specially and assailed the petition upon the grounds that
the court has no jurisdiction to take cognizance and decide the case and that the
petition does not allege sufficient facts to entitle the applicants to the remedy
prayed for; and asked that the petition be finally dismissed. Carlos Young
intervened and filed a motion asking for the dismissal or the petition upon the
ground that the Code of Civil Procedure, under which the same was filed, is not
applicable because it was not yet in force when the original owner of the
hacienda died, which was in April, 1596, and that the petition was irregularly
docketed as the applicants had paid at the docket fees which the clerk of court
should collect. Subsequently the attorneys for both parties filed another motions
of minor importance, almost all of which contains the arguments advanced in
support of their contentions. On October 29, 1936, the court overruled the
objection to the appearance and intervention in the case by the Colegio de San
Jose and Carlos Young, entering the order which is one of those appealed from.
And on the 30th of the same moth the court entered the resolution, also
appealed from, dismissing the petition for escheat, with the costs to the
petitioners.
The petitioners attribute to the court the following errors: "(1) In overruling the
objection of the appellant of September 2, 1936, and in not excluding the
appellees Carlos Young and Colegio de San Jose, Inc., from these proceedings.

(2) In sustaining definitely the appellees' petitions to dismiss, without previous

hearing and in derogation of the right to amend in any case. (3) In improperly
and unseasonably taking judicial notice of certain facts in other judicial records
to reinforce the appealed resolutions, and in erroneously distorting those facts
judicially taken notice of. (4) In holding that the municipality of San Jose has
neither right standing to file a petition for escheat; that the petition does not state
facts sufficient a cause of action and that the same does not lie, and that the
Court of First Instance of Laguna is without jurisdiction to take cognizance of
and decide said petition. (5) In finally dismissing the petition upon the dilatory
exceptions thereto, and the ordering the payment of costs when no hearing has
yet taken place."
1. The sworn petition which gave rise to the proceeding is based upon the
provisions of section 750 and 751 of the Code of Civil Procedure, the English
text of which reads:1vvphl.nt
SEC. 750. Procedure when person dies intestate without heirs. When
a person dies intestate, seized of real or personal property in the
Philippines Islands, leaving no heir or person by law entitled to the
same, the president and municipal council of the municipality where the
deceased last resided, if he was an inhabitant of these Islands, or of the
municipality in which he had estate, if he resided out of the Islands,
may, on behalf of the municipality, the file a petition with the Court of
First Instance of the province for an inquisition in the premises; the court
shall there upon appoint a time and place of hearing, and deciding on
such petition, and cause a notice thereof to be published in some
newspaper of general circulation in the province of which the deceased
was last an inhabitant, if within the Philippines Island, and if not, some
newspaper of general circulation in the province in which he had estate.
The notice shall recite the substance of the facts and request set forth in
the petition, the time and place at which persons claiming the estate
may appear and be heard before the court, and shall be published at
least six weeks successively, the last of which publication shall be at
least six weeks before the time appointed by the court to make
inquisition.
SEC. 751. Decree of the court in such case. If, at the time appointed
for the that purpose, the court that the person died intestate, seized of
real or personal property in the Islands, leaving no heirs or person
entitled to the same and no sufficient cause is shown to the contrary, the
court shall order and decree that the estate of the deceased in these
Islands, after the payment of just debts and charges, shall escheat; and
shall assign the personal estate to the municipality where he was last an
inhabitant in the Islands, and the real estate to the municipality in which
the same is situated. If he never was a inhabitant of the Islands, the

RULE 91: ESCHEAT

whole estate may be assigned to the several municipalities where the

same is located. Such estate shall be for the use of schools in the
municipalities, respectively, and shall be managed and disposed or by
the municipal council like other property appropriated to the use of
schools.
Accordingly to the first of the said sections, the essential facts which should be
alleged in the petition, which are jurisdiction because they confer jurisdiction
upon the Court of First Instance, are: That a person has died intestate or without
leaving any will; that he has left real or personal property; that he was the owner
thereof; that he has not left any heir or person who is by law entitled to the
property; and that the one who applies for the escheat is the municipality where
deceased had his last residence, or in case should have no residence in the
country, the municipality where the property is situated.
The following section provides that after the publications and trial, if the court
finds that the deceased is in fact the owner of real and personal property
situated in the country and has not left any heirs or other person entitled thereto,
it may order, after the payments of debts and other legal expenses, the escheat,
and in such case it shall adjudicate the personal property to the municipality
where the deceased had his last place of residence and the real property to the
municipality or municipalities where they are situated.
Escheat, under sections 750 and 751, is a proceeding whereby the real and
personal property of a deceased person become the property of the State upon
his death without leaving any will or legal heirs (21 C.J., sec. 1, p. 848; American
L. & T. Co. vs. Grand River Co., 159 Fed., 775; In re Miner, 143 Cal., 194;
Johnston vs. Spicer 107 N.Y., 185; Wright vs. Methodist Episcopal Church,
Hoffm. [N.Y.], 201; In re Linton's, 198 Pa., 438; State vs. Goldberg, 113 Tenn.,
298). It is not an ordinary action contemplated by section 1 of the Code of Civil
Procedure, but a special proceeding in accordance with the said section and
Chapter XXXIX, Part II, of the same Code. The proceeding, as provided by
section 750, should be commenced by petition and not by complaint.
In a special proceeding for escheat under section 750 and 751 the petitioner is
not the sole and exclusive interested party. Any person alleging to have a direct
right or interest in the property sought to be escheated is likewise and interest
and necessary party and may appear and oppose the petition for escheat. In the
present case the Colegio de San Jose, Inc., and Carlos Young appeared
alleging to have a material interest in the Hacienda de San Pedro Tunasa; and
the former because it claims to be the exclusive owner of the hacienda, and the
latter because he claim to be the lessee thereof under a contract legality entered
with the former. In view of these allegations it is erroneous to hold that the said
parties are without right either to appear in case or to substantiate their

respective alleged right. This unfavorably resolves the petitioners' first

assignment of error.
2. The final dismissal of the petition for escheat decreed by the court is assigned
by the petitioners as the second error committed by it upon the contention that
the demurrer, to which amount the motions for dismissal, is not a pleading
authorized by law in this kind of proceeding and because, in any event, the court
should have given them an opportunity to amend the petition.
Chapter XXXIX of the Code of Civil Procedure, relative to the escheat of
properties, does not in fact authorize the filing of a demurrer to the petition
presented for that purpose, and section 91 and 99 permitting the interposition of
demurrers to the complaint and answer, respectively, are not applicable to
special proceedings. But is no reason of a procedure nature which prevents the
filing of a motion to dismiss based upon any of the grounds provided by law for a
demurrer to a complaint. In such case, the motion to dismiss pays the role of a
demurrer and the court should resolve the legal question raised therein. When,
for instance, a petition for escheat does not state facts which entitle the
petitioner to the remedy prayed from and even admitting them hypothetically it is
clear that there are nor grounds for the court to proceed to the inquisition
provided by law, we see no reason to disallow an interest party from filing a
motion to dismiss the petition which is untenable from all standpoints. And when
the motion to dismiss is entertained upon this ground, the petition may be
dismissed unconditionally and the petitioner is not entitled, as in the case of a
demurrer, to be afforded an opportunity to amend his petition.
3. The petitioners assign as third error the judicial notice which the court took of
the complaint filed in civil case No. 6790, docketed and pending in the same
court, wherein the petitioner recognized the personality Colegio de San Jose,
Inc., and Carlos Young and the latters' interest in said action of interpleader and
in the Hacienda de San Pedro Tunasan which is the same subject matter of the
instant proceedings.
In general, courts are not authorized to take judicial notice, in the adjudication of
cases pending before them, of the contents of the records of the other cases,
even when such cases have been tried or are pending in the same court, and
notwithstanding the fact that both cases may have been heard or are actually
pending before the same judge. (U.S. vs. Claveria, 29 Phil., 527.) The rule is
squarely applicable to the present case, wherefore, we hold that the assignment
of error is tenable.
4. In the appealed resolution the court held that the municipality of San Pedro,
represented by the petitioners, has no personality to institute the petition for
escheat that the latter does not state sufficient facts, and that the court is without

RULE 91: ESCHEAT

jurisdiction either to take cognizance of the proceeding or to grant the remedy

sought. These legal conclusions are the subject matter of the fourth assignment
of error.
According to the allegations of the petition, the petitioners base their right to the
escheat upon the fact that the temporal properties of the Father of the Society of
Jesus, among them, the Hacienda de San Pedro Tunasan, were confiscated by
order of the King of Spain and passed from then on the Crown of Spain. The
following allegations of the petition are important and specific and clearly the
theory maintained by the petitioners: "11. As a result of the perpetual expulsion
of the Jesuits in their dominions, the King also decreed the confiscation of all
their properties, estate, rents, foundation, etc., in favor of the Crown of Spain,
and the order of the King was thus complied with here in the Philippines. The
Hacienda de San Pedro Tunasa from then on passed to the Crown of Spain
under the administration and management on its respective here, the GovernorGeneral of the Philippines Islands. 12. As a result of the war between Spain and
the United States, the latter acquired by way of transfer, all the properties of the
Crown of Spain in the Philippines, under articles III and VIII of the Treaty of
Peace entered into in Paris on December 10, 1989, and among which properties
was included the Hacienda de San Pedro Tunasan. 13. That the said hacienda
thereafter passed to the Government of the Philippines Islands by virtue of the
Act of the United States Congress of July 1, 1992 (Philippine Bill), by mere
administration for the benefit of the inhabitant of the Philippines; and there after,
under the Tydings-McDuffie law approved by the same Congress on March 24,
1934, section 5, the United States, in turn, have ceded to the Commonwealth of
the Philippines, upon its inauguration, all the properties, estate, etc., ceded by
Spain to the United States as above stated, among them being the Hacienda de
San Pedro Tunasan. Said Commonwealth was inaugurated on November 15,
1935."
If the hacienda de San Pedro Tunasan,, which is the only property sought to be
escheated and adjudicated to the municipality of San Pedro, has already passed
to the ownership of the Commonwealth of the Philippines, it is evident that the
petitioners cannot claim that the same be escheated to the said municipality,
because it is no longer the case of real property owned by a deceased person
who has not left any heirs or person who may legality claim it, these being the
conditions required by section 750 and without which a petition for escheat
should not lie from the moment the hacienda was confiscated by the Kingdom of
Spain, the same ceased to be the property of the children of Esteban Rodriguez
de Figueroa, the Colegio de San Jose or the Jesuit Father, and became the
property of the Commonwealth of the Philippines by virtue of the transfer under
the Treaty of Paris, alleged in the petition. If the municipality of San Pedro
believes that it has some other right to the hacienda, distinct from the escheat
relied upon in its petition which gave rise to this proceeding, it should bring the
proper action, but it cannot avail itself successfully of the remedy provided by

section 750 of the Code of Civil Procedure. We, therefore, hold that the court did
not commit the error assigned in ruling that the petition does not allege sufficient
facts justifying the escheat of the hacienda in favor of the municipality of San
Pedro and in finally dismissing the same. Having reached this conclusion we do
not believe it necessary to go into further considerations regarding the
personality of the municipality of San Pedro and the court's lack of jurisdiction.
5. The last assignment of error does not require any further consideration. The
questions raised therein have already been passed upon in the preceding
considerations, with the exception of the order to pay costs. With respect
thereto, there is no reason why they should not be taxed against the petitioners,
they being defeated party (section 487, Code of Civil Procedure). That no trial
was had is not a bar to the imposition of costs under the provisions of section
492.
For the foregoing reasons, the appealed order and resolution are affirmed, with
the costs of this instance against the petitioners and appellants. So ordered.
Avancea, C.J., Villa-Real, Abad Santos, Diaz, Laurel and Concepcion, JJ.,
concur.

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G.R. No. L-4824

February 13, 1912

In re estate of the deceased Chinaman

BERNARDO RAFANAN LAO SAYCO, alias SAYA. LAY CHUYTING,
appellant.
Martin M. Levering for appellant.
TORRES, J.:
This is an appeal by the Chinaman Lao Chiama, administrator of the estate of
the decedent Bernardo Rafanan Lao Sayco, alias Saya, and guardian of the
minor Lay Chuyting, from the judgment rendered in these special proceedings
by the Honorable Judge, Ramon Avancea.
Counsel for the municipal president of the pueblo of Mambajao, complying with
a resolution of the council of the said pueblo, set forth in an undate petition filed
with the Court of First Instance of Misamis:
That, on January 23, 1906, the municipal council of Mambajao appeared in the
said proceedings and prayed that, since Bernardo Rafanan died in that pueblo
without leaving any known legitimate successor, the real and personal property
left by the said decedent within the district of the property left by the said
decedent within the district of the aforementioned municipality be awarded to the
latter, pursuant to the provisions of section 571 (sic) of Act No. 190, which
property was specified in the inventory presented by the testamentary executor,
Lao Chiaman, and that no ruling had been made on the said petition; that on
October 19 of the same year, the administrator, Lao Chiaman, filed a written
petition wherein he alleged that there were no longer any debts to pay any debts
to pay and therefore requested that, upon the approval of his final account, his
administration be closed, and, as the guardian of the Chiaman Lay Chuyting,
requested that the property referred to be delivered to the latter as the son and
sole heir of the decedent Rafanan; that the municipal council of Mambajao,
which believed that it was entitled to the said property, opposed its delivery to
the alleged heir, whose character as such was denied by the petitioner, who
therefore prayed that he admitted as a party to the proceedings and that a day
be set for the hearing of the case, in order that the alleged heir, Lay Chuyting,
might prove his right, and should he fail so to do, then that the right of the
municipal council of Mambajao be recognized, with such other findings, in
addition, as law and justice might demand.
Lao Chiaman, administrator of the property of the decedent Rafanan and
guardian of the minor Lay Chuyting, opposed in writing the petition of the
municipality of Mambajao, on the ground that the said decedent left a legal heir,

the minor Lay Chuyting, residing in China, who was a son of the deceased Lao
Ta, the latter a brother of the decedent Bernardo Rafanan Lao Sayco, and that,
therefore, Lay Chuyting was the latter's nephew, and not his son, as previously
erroneously stated in the course of these proceedings. Petitioner stated that he
desired to take the depositions of witnesses in the city of Cebu, in order to
establish the facts set forth by him and asked that the hearing of the case be set
for the month of June, 1907.
A hearing in these proceedings was had on February 20, 1908, after notice had
been served on all who might have any interest in the intestate succession
concerned, and after the publication of the decrees for three weeks prior to the
date set. In view of the dispositions of witnesses presented at the trial, the court,
on March 5, 1908, rendered judgment ordering that the property left by the
decedent, Bernardo Rafanan Lao Sayco, known by the name of Saya, be
assigned to the municipality of Mambajao, Province of Misamis, to be
administered by its municipal council and placed at the disposal of the school in
the same manner as other property intended for the same use. It was further
ordered that the administrator of the intestate estate, after paying the actual
expenses and debts chargeable thereto, deliver the remainder to the
municipality of Mambajao, and afterwards report to the Court of First Instance
his compliance with and fulfillment of the order. From this judgment the said
administrator and guardian of the minor Lay Chuyting appealed, for which
purpose a certified copy of the record was forwarded to the clerk of this court.
This case concerns the revision to the State of certain property which was left at
death by the Chinaman Bernardo Rafanan Lao Sayco, alias Saya, who died in
the pueblo of Mambajao, Province of Misamis apparently without having
executed any will during his lifetime and without leaving any known heirs in said
locality.
Section 750 of the Code of Civil Procedure, applicable to the case, reads as
follows:
When a person dies intestate, seized of real or personal property in the
Philippine Islands, leaving no heir or person by law entitled to the same,
the president and municipal council of the municipality where the
deceased last resided, if he was an inhabitant of these Islands, or of the
municipality in which he had estate, if he resided out of the Islands,
may, on behalf of the municipality, file a petition with the Court of First
Instance of the province for an inquisition in the premises; the court shall
thereupon appoint a time and place of hearing and deciding on such
petition, and cause a notice thereof to be published in some newspaper
of general circulation in the province of which the deceased was last an
inhabitant, if within the Philippine Islands, and if not in some newspaper
of general circulation in the province in which he had estate. The notice

RULE 91: ESCHEAT

shall recite the substance of the facts and request set forth in the
petition, the time and place at which persons claiming the estate may
appear and be heard before the court, and shall be published at least
six weeks successively, the last of which publications shall be at least
six weeks before the time appointed by the court to make inquisition.
From the record of these proceedings it does not appear that there was made,
at the request of counsel for the president and the municipal council of
Mambajao, the inquisition provided by law, specified in the preinserted section,
for the record is not accompanied by any certified copy of the investigatory of
the real and personal property that belonged to the said decedent, with a
statement of the places where the realty is located. Neither is it shown to have
ascertained whether the deceased Chinaman executed any will during his
lifetime, or whether the deceased Chinaman executed any will during his
lifetime, or whether he left in Mambajao or in any other place in these Islands
any relative entitled to inherit from him, information in regard to which points
might be furnished by those who were his friends or with whom he had friendly
dealings during his lifetime. Moreover, the notice summoning the persons who
believed they were entitled to his property should have been published for at
least six consecutive weeks, and not for three as was directed in the order of
December 16, 1907.
In order that the property which belonged to the decedent Bernardo Rafanan
Lao Sayco, situated in these Islands, may be decreed to have reverted to the
Senate, pursuant to the provisions of section 751 of the Code of Civil Procedure,
it is indispensable that the requirements contained in the above-quoted section
of the said code should have been complied with by making the inquisition with
regard to the matters specified, at the instance of the interested municipality.
Furthermore, the person who lays claim to the property left by the decedent at
death, as the latter's successor or heir, must prove his identity and rights.
Counsel for the municipality of Mambajao merely prayed for an order of
reversion and for the adjudication in behalf of the municipality of the property
aforementioned; he did not comply with the provisions of the law by furnishing
the required proofs in regard to the matters hereinabove indicated, which must
be the subject of an investigation.
For the reasons aforestated, it is proper, in our opinion, to reverse the judgment
appealed from, and we dismiss those proceedings, without prejudice to any
rights that may pertain to the parties with respect to the property in question. No
express finding is made of the costs.
Arellano, C.J., Johnson, Carson, Moreland and Trent, JJ., concur.

RULE 91: ESCHEAT

G.R. No. L-10033

August 30, 1917

THE CITY OF MANILA, petitioner-appellant,

vs.
THE ROMAN CATHOLIC ARCHBISHOP OF MANILA and THE
ADMINISTRATOR FOR THE ESTATE OF MARIA CONCEPCION
SARMIENTO, interveners-appellees.
City Attorney Escaler for appellant.
William A. Kincaid and Thomas L. Hartigan for the appellee Roman Catholic
Archbishop of Manila.
No appearance for the other appellee.
JOHNSON, J.:
This action was commenced in the Court of First Instance of the city of Manila
on the 15th day of February, 1913. Its purpose was to have declared escheated
to the city of Manila certain property situated in and around said city; that said
property consists of five parcels of land located ion the districts of Malate and
Paco of the city of Manila, as shown in a plan, in the office of the Department of
Engineering and Public Works of said city of Manila, No. B-10-27. The theory of
the plaintiff is that one Ana Sarmiento was the owner of said property and died
in the year 1668 without leaving "her or person entitled to the same."
After hearing the evidence, the Honorable A. S. Crossfield, in a carefully
prepared opinion, reached the conclusion that the prayer of the plaintiff should
be denied without any finding as to costs. From that conclusion the plaintiff
appealed to this court and made a number of assignments of error.
After an examination of the evidence adduced during the trial of the cause, we
find that the following facts were proved by a large preponderance of the
evidence: That Ana Sarmiento resided, with her husband, in the city of Manila
sometime prior to the 17th day of November, 1668; that on said date she made
a will; that on the 23d day of November, 1668, she added a codicil to said will,
that on the 19th day of May, 1669, she made another will making a part thereof
the said codicil of November 23d, 1668; that said will contained provisions for
the establishment of a "Capellania de Misas;" that the first chaplain of said
capellania should be her nephew Pedro del Castillo; that said will contained a
provision for the administration of said property in relation with the said
"Capellania de Misas" succeeding administration should continue perpetually;
that said Ana Sarmiento died about the year 1672; that for more than two
hundred years the intervener, the Roman Catholic Archbishop of Manila,
through his various agencies, has administered said property; that the Roman

Catholic Archbishop of Manila has rightfully and legally succeeded in

accordance with the terms and provisions of the will of Ana Sarmiento.
Section 750 of Act No. 190 provides when property may be declared escheated.
It provides, "when a person dies intestate, seized of real or personal property . .
. leaving no heir or person by law entitled to the same," that then and in that
case such property under the procedure provided for by sections 751 and 752,
may de declared escheated.
The proof shows that Ana Sarmiento did not die intestate. She left a will. The will
provides for the administration of said property by her nephew as well as for the
subsequent administration of the same. She did not die without an heir nor
without persons entitled to administer her estate. It further shows that she did
not die without leaving a person by law entitled to inherit her property. In view of
the facts, therefore, the property in question cannot be declared escheated as of
the property of Ana Sarmiento. If by any chance the property may be declared
escheated, it must be based upon the fact that persons subsequent to Ana
Sarmiento died intestate without leaving heir or person by law entitled to the
same.
The will clearly, definitely and unequivocally defines and designates what
disposition shall be made of the property in question. The heir mentioned in said
will evidently accepted its terms and permitted the property to be administered in
accordance therewith. And, so far as the record shows, it is still being
administered in accordance with the terms of said will for the benefit of the real
beneficiary as was intended by the original owner.
The record fully and completely shows that the theory of the plaintiff is without
foundation either in fact or in law.
The judgment of the lower court is, therefore, hereby affirmed, with costs in this
instance. So ordered.
Arellano, C.J., Araullo, Street and Malcolm, JJ., concur.

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G.R. No. L-38622

October 26, 1987

VALENTIN BERMUDO, petitioner,

vs.
THE HONORABLE COURT OF APPEALS, FORMER SIXTH DIVISION; THE
HONORABLE COURT OF FIRST INSTANCE OF LEYTE, BRANCH 1 and
THE CHINESE NATIONALIST PARTY OF TACLOBAN, respondents.
FERNAN, J.:
This special civil action for certiorari and prohibition stemmed from the decision
of the then Court of First Instance of Leyte granting a petition for relief from its
order directing the reconstitution of an original certificate of title covering a
parcel of land.
Tom Chow and Go Se Pieng claimants of Lot 776, a 505 square meter parcel of
land located in Lopez Jaena Street, Tacloban City, obtained a judicial decree of
registration No. 494657 on October 8, 1931 as co-owners pro-indiviso in fee
simple thereof. They were issued Original Certificate of Title No. 10256 on
November 3, 1932.
The record shows, however, that on June 27, 1931, before the issuance of said
decree and title, Tom Chow and Go Se Pieng had renounced their interests,
rights and privileges over Lot 776 in a document [Exh. 2] wherein they professed
that they were mere trustees of the Chinese Nationalist Party of Tacloban,
Leyte. The latter allegedly acquired said lot from the Philippine Refining
Company, Inc. Consequently, on September 4, 1940, Transfer Certificate of Title
No. 858 was issued to the Chinese Nationalist Party.

and that by virtue of a deed of adjudication and absolute sale executed on June
3, 1964, Cristina Esperas Vda. de Chow transferred all the interests and
participation of Tom Chow over Lot 776 to Bermudo.
Shortly thereafter or on December 8, 1964, TCT No. 1948 was issued to
2
Bermudo and Go Se Pieng as owners of Lot 776 in "equal shares undivided."
On January 23, 1965, the Chinese Nationalist party [hereinafter known as the
Party] filed a petition for relief from said order praying for its annulment and for
the issuance of an order cancelling TCT No. 1948. It alleged that the
reconstitution order was obtained through misrepresentation and fraud there
being no notice of hearing of the petition for reconstitution in spite of the fact that
Bermudo, who was residing adjacent to Lot 776, had personal knowledge that
said lot had been owned and possessed by the Party for more than thirty years
by virtue of TCT No. 858. It added that it came to know of the reconstitution
order only on January 5, 1965 when the occupants of said lot informed its
3
president that Bermudo had filed an ejectment case against them.
In his opposition to said petition, Bermudo averred that notice of the hearing of
his petition was duly published; that he did not know of any participation of the
Party in said land; that the latter had no legal capacity to sue; that under existing
laws, it could not own land; that the land allegedly titled in its name was not the
same parcel of land subject matter of the case and that the petition for relief was
4
pro farma and intended merely to delay the proceedings in the case.
In its decision of January 6, 1968, the lower court set aside its order to
reconstitute OCT No. 10256, annulled and cancelled TCT No. 1948 and
declared TCT No. 858 to be in fun force and effect.

Almost twenty-four years later or on June 23, 1964, Valentin Bermudo filed in
the Court of First Instance of Leyte, Branch I at Tacloban City, a petition for the
reconstitution of the records of OCT No. 10256. He alleged therein that he was
the "vendee to the extent of one-half [1/2] pro-indiviso" of Lot 776. Annexed to
the petition was a certification of the Register of Deeds of Leyte and Tacloban
City stating that the Book containing said OCT No. 10256 "was completely
destroyed," that a diligent and religious search thereof proved futile, and that,
"no owner's Duplicate Certificate of Title No. 10256 was ever issued in favor of
anybody." 1

The lower court found that Bermudo acted in bad faith in obtaining the
reconstitution of OCT No. 10256. It noted that being a resident of the property
adjacent to Lot 776, Bermudo could have known the possessor and owner of the
lot. It stated that, after the Party had presented the widow of Tom Chow,
Magdalena Esperas Vda. de Chow, Bermudo failed to rebut her testimony
through his own precedessor-in-interest, Cristina Esperas Vda. de Chow,
allegedly also a widow of Tom Chow. The lower court also ruled that OCT No.
10256 could no longer be reconstituted because it had been cancelled by TCT
No. 858 in the name of the Party.

As there was no opposition to said petition, the lower court, after the hearing,
issued an order dated November 23, 1964 allowing the reconstitution of the
records of OCT No. 10256. The lower court based its order on its findings that
per an authenticated copy of the aforesaid judicial decree of registration No.
494657, Tom Chow and Go Se Pieng were the owners in fee simple thereof,

After receiving a copy of said decision, Bermudo filed a notice of appeal to this
5
Court. As the original record of the case was transmitted to this Court, We
required Bermudo to file the proper petition for review on certiorari pursuant to
6
Republic Act No. 5440.

RULE 91: ESCHEAT

The petition, which was docketed as L-30730, "Valentin Bermudo vs. Chinese
Nationalist Party, et al.", was denied by the Court for non-compliance with the
Rule requiring a verified statement of material dates and proof of service of the
7
petition on the lawer court. Bermudo's motion for reconsideration of said denial
resolution was granted by the Court in the resolution of September 24, 1969 but,
it appearing that the petition involved mixed questions of law and fact, the Court
8
transmitted the petition to the Court of Appeals.
In its decision of December 11, 1972, the Court of Appeals * dismissed the
petition, ruling that Bermudo did not acquire a legal and valid title over Lot 776
from his predecessor-in-interest, Cristina E. Vda. de Chow, and hence, he is not
entitled to seek reconstitution of the title covering said land. It underscored the
fact that OCT No. 10256 was no longer in force when the reconstitution order
was issued because as early as September 4, 1940, said title had been
cancelled and in lieu thereof TCT No. 858 was issued in favor of the Party. It
also upheld the Party's capacity to sue on the ground that by virtue of the old
Civil Code, specifically Articles 1667 and 1356 thereof, it was possessed of
juridical personality.
Bermudo elevated said decision to this Court through another petition for review
on certiorari. Docketed as L-36156, "Valentin Bermudo vs. Court of Appeals, et
9
al., " said petition was denied for lack of merit on January 29, 1973. His motion
for the reconsideration of the denial resolution was likewise denied for lack of
merit. 10
Undaunted, Bermudo filed the instant petition for certiorari and prohibition. He
asserts that the Court of Appeals acted beyond its power and authority when it
affirmed the lower court's decision setting aside its order directing the
reconstitution of OCT No. 10256, after the said order had been executed and
enforced. 11
From the procedural standpoint, We agree with the petitioner that the Court of
Appeals acted beyond its authority in upholding the lower court's decision. When
the Party filed its petition for relief, the order of reconstitution had not only
become final and executory. Said order was already executed by the issuance
of the reconstituted OCT No. 10256 which resulted in the subsequent issuance
of TCT No. 1948 to Bermudo. As a petition for relief from judgment is proper
only when the court is still in control of the proceedings, 12 the lower court
should not have entertained the Party's petition because by that time, it was
already deprived of its jurisdiction over the case. Furthermore, the lower court
should have considered the fact that premised on equity, relief from judgment is
granted only in exceptional cases and, being an act of grace, it is not regarded
with favor. 13

For its part, in choosing a remedy for the allowance of the reconstitution of OCT
No. 10256 and the subsequent issuance of TCT No. 1948, the Party should
have considered the fact that it was, by its own admission, not served notice of
the judicial reconstitution proceeding. Rule 38 cannot be applied when the one
deprived of his right was never made a party to the case for lack of the requisite
notice. 14
Under the circumstances, the Party should have availed of the remedy provided
for in Republic Act No. 26 which states:
SEC. 19. ... Provided, however, That if the reconstituted
certificate of title has been cancelled by virtue of any deed or
instrument, whether voluntary or involuntary or by an order of
the court, and a new certificate of title has been issued, the
procedure prescribed above with respect to memoranda or new
liens or encumbrances made on the reconstituted certificate of
title, after its reconstitution, shag be followed with respect to the
new certificate of title, and to such new hens or encumbrances,
if any, as may have been made on the latter, after the issuance
thereof.
The procedure referred to in said provision with respect to memoranda of new
liens or encumbrances annotated on a reconstituted certificate of title, consists
of the filing of a petition with the proper Court of First Instance "for the
annotation of such right or interest on said reconstituted certificate of title and
the court, after notice and hearing, shall determine the merits of the petition and
render such judgment as justice and equity may require." 15
The Party's improper remedy notwithstanding, We are not prepared to uphold
Bermudo's claim to one-half interest over the undivided lot. Extant from the
records are proofs that Bermudo, as correctly found by both the lower court and
the Court of Appeals, acted in bad faith is seeking the reconstitution of OCT No.
10256.
Bermudo has not denied the fact that he was residing adjacent to Lot 776 when
he filed the petition for reconstitution of title and yet, he failed to give notices of
the hearing on the petition for reconstitution even to its actual occupants. Such
failure manifested an attempt to present any opposition to his petition, not
realizing that it would prove fatal to his case considering that notice and the
procedural requirements of Republic Act No. 26 are mandatory. 16 Thus, courts
must exercise utmost caution in entertaining petitions for reconstitution and
should make sure that the indispensable parties, i.e., the actual owners and
possessors of the lands involved, are duly served with actual and personal
notice of the petition, and not by mere general publication. 17

RULE 91: ESCHEAT

Moreover, it is possible that Bermudo could have bought an interest in Lot 776
from the wrong Mrs. Chow. He should not have relied on the testimony of Mrs.
Magdalena Esperas Vda. de Chow that she could not personally locate and
Identify Lot 776. He should have presented anew as witness his alleged
predecessor-in-interest, Mrs. Cristina Esperas Vda. de Chow to rebut
Magdalena's testimony and to prove the authenticity of Cristina's claim over the
property. In the light of these factual findings, Bermudo's right to a one-half
interest over Lot 776 is therefore unclear and doubtful.
On the other hand, the Party's claim over Lot 776 appears to be as nebulous as
Bermudo's. It allegedly acquired the lot from the Philippine Refining Company,
Inc. but two trustees [who, by their Chinese names might have been aliens]
obtained an original certificate of title over it. It is worth noting, however, that the
judicial decree of registration in favor of said trustees did not indicate that they
claimed their right over Lot 776 as such trustees even if they had renounced
their rights as such trustees before the issuance of both the judicial decree of
registration and the original certificate of title.
The fact that the Party acquired TCT No. 858 in 1940 when the 1935
Constitution was in full force and effect further beclouds its right to acquire title
over Lot 776. While at that time the Party might have acquired a juridical
personality if We are to go by the finding of the Court of Appeals, it is still
unclear whether it was also qualified to acquire or hold lands considering the
provision of the 1935 constitution limiting the acquisition of land only to
corporations or associations at least sixty per cent of the capital stock of which is
owned by Filipino citizens.18 Although the Party had no capital stocks as it was
allegedly a "civil association", it cannot escape said Constitutional mandate
because the purpose and spirit of the 1935 Constitution "demands that in the
absence of a capital stock, the controlling membership should be composed of
Filipino citizens." 19 Nowhere in the record does it show that the Party fulfills
said "sixty per centum" requirement.
But granting that the Party is qualified to hold or own private land, still, there is
the question of whether ownership of Lot 776 is indispensable to its activities as
a "civil association." A corporation's right to hold or own lands is further delimited
20
by the provision of the Corporation Law Section 13(5) of which states that no
corporation shall be "permitted to hold or own real estate except such as may be
reasonably necessary to enable it to carry out the purposes for which it is
created." Hence, it is still imperative for the Party to prove that ownership of Lot
776 was necessary when it acquired title over it in 1940, in order that it could
undertake its aims as a "civil association."
Worth noting is the fact that it was only on November 29, 1966, while its petition
for relief from judgment was pending resolution in the lower court, that the Party
reorganized itself, reincorporated under the new name Leyte Kuomintang

Cultural Association, Inc. and registered with the Securities and Exchange
Commission. We view such belated move as aimed at obtaining documentary
evidence of its juridical existence to supplement the testimonial proof of its
juridical personality which was questioned by Bermudo.
Furthermore, in his memorandum, Bermudo also alleged that aside from the fact
that the Party presented only a photograph of TCT No. 858 with a certification
from the office of the Register of Deeds that it was a true copy, the Register of
Deeds of Leyte found three transfer certificates of title bearing the same number
in the names of the Party, one Feliciano Labastida, and the Tacloban Electric
21
22
and Ice Plants Co., Inc. The Party failed to rebut said allegation.
The existence of three transfer certificates of title all numbered 858 in the same
locality is an anomaly that requires investigation and correction. That anomalous
situation, coupled with Our finding that it is very possible that both at the time of'
the Party's acquisition of Lot 776 and the issuance in its favor of TCT No. 858, it
was not qualified to hold and own private land under the 1935 Constitution and
pertinent laws, compel Us to consider the Party's ownership over Lot 776 as
questionable.
To remove all doubts over the Party's right over lot 776 and to settle the
question of who really should be entitled to register said lot in his name, We are
convinced that an escheat proceeding under Section 5, Rule 91 of the Rules of
Court must be initiated by the government. All interested parties, especialIy the
actual occupants and the adjacent lot owners including petitioner Bermudo shall
be personally notified of the proceeding and given the opportunity to prevent
their valid claims over Lot 776 otherwise it will be reverted to the State.
WHEREFORE, the petition for certiorari and prohibition is herein dismissed. The
Solicitor General or his representative is hereby directed to immediately file an
escheat proceeding pursuant to Section 5, Rule 91 of the Rules of Court in the
proper Regional Trial Court which shall give priority to the case and decide it at
the earliest possible time.
SO ORDERED.
Gutierrez, Jr., Feliciano, Bidin and Cortes, JJ., concur.

RULE 91: ESCHEAT

[G.R. No. 45496. May 5, 1939.]

THE ROMAN CATHOLIC ARCHBISHOP OF MANILA, applicant and amicus
curi; THE MUNICIPAL COUNCIL OF PARAAQUE, RIZAL, PetitionerAppellant, v. EL MONTE DE PIEDAD Y CAJA DE AHORROS DE MANILA,
PADRES REDENTORISTAS, and THE ASIATIC PETROLEUM CO. (P. I.) ,
LTD., Respondents-Appellees.
Juan S. Rustia for Appellant.
Jose Ma. Cavanna for appellee Monte de Piedad.
Ross, Lawrence, Selph & Carrascoso for appellee Asiatic Petroleum Co.
Feria & La O for applicant and amicus curi, and for Padres
Redentoristas.

DECISION

MORAN, J.:

On September 30, 1911, the Roman Catholic Archbishop of Manila, a

corporation role, filed with the then Court of Land Registration an application for
the registration of three (3) parcels of land in Paraaque, Rizal, alleging that the
property had been acquired thru donation from Doa Ana Maria de Araujo for
religious purposes. On December 1, 1911, the court rendered judgment granting
the application. On January 19, 1912, decree No. 6443 was issued and later the
corresponding certificate of title. Thereafter, the property was transferred to "El
Monte de Piedad y Caja de Ahorros de Manila" and to the Asiatic Petroleum Co.
(P. I.) , Ltd., accept one portion occupied by the "Padres Redentoristas" and
another which was expropriated by the Province of Rizal for public road
purposes.

SYLLABUS
1. ESCHEAT; IMPLIED WAIVER OF RIGHT. The right to escheat claimed by
the municipality has existed long prior to the registration proceedings instituted
by the Roman Catholic Archbishop of Manila, and, as the same has not been
asserted in said proceedings, it is deemed to have been completely waived.
2. ID.; REGISTRATION OF LAND; EFFECT OF CERTIFICATE OF TITLE.
Under the Torrens system of registration, claims and liens of whatever
character, except those mentioned by law, existing against the land prior to the
issuance of the certificate of title, are cut or by such certificate if not noted
thereon, and the certificate 80 issued binds the whole world including the
Government (secs. 38, 39 and 47, Act No. 496; Aldecoa & Co. v. Warner,
Barnes & Co., 30 Phil., 163, 209; Snyder v. Provincial Fiscal of Cebu and Avila,
42 Phil., 761, 765).
3. ID.; ID.; ID.; PROPER REMEDY. Appellant seems to contend that as the
property over which the Roman Catholic Archbishop of Manila has acquired a
certificate of title has never been really transferred to him by A. M. de A., an
implied trust has been created which may be enforced against him in favor of
the successors in interest of said A. M. de A. This contention is completely
untenable; and, even assuming it to be right, the appropriate remedy is not a
petition in the land registration proceedings but a separate action. This rule is
especially applicable where, as in the instant case, there are third persons
affected. It is argued that the transfers made to these entities are null and void.
Be that as it may, the nullity of such transfers cannot be determined by a motion
in the registration proceedings but in a separate action.

Twenty-four years after the issuance of the original certificate of title in favor of
the Roman Catholic Archbishop of Manila, the municipality of Paraaque, Rizal,
filed in the registration proceedings with the Court of First Instance of Rizal a
petition seeking, under sections 110 and 112 of Act No. 496 and sections 750
and 751 of the Code of Civil Procedure, a declaration of escheat in its favor on
the property in question. The court ordered the parties concerned to show cause
why the petition should not be granted, and "El Monte de Piedad y Caja de
Ahorros de Manila," the "Padres Redentoristas," the Asiatic Petroleum Co. (P. I.)
, Ltd., and the Roman Catholic Archbishop of Manila filed their respective
oppositions to the petition. After hearing, the court, in an order dated November
28, 1936, denied the petition on the ground that the same could not be
entertained in the registration proceedings. From this order the municipality
appealed.
The municipality holds the view that the property had not been really donated by
Doa Ana Maria de Araujo to the Roman Catholic Archbishop of Manila but that
she merely constituted, on November 13, 1677, a chaplaincy allotting one
hundred pesos (P100) yearly for masses to be said for the repose of her and her
parents soul; that this amount should be taken from the rents of the property in
question and given to Bachiller Felipe de los Reyes who, after being ordained as
priest and later as a chaplain, may say the masses above mentioned; and that
as the chaplain died without heirs, the property should escheat in favor of the
municipality.
It should be noted that Doa Ana Maria de Araujo and the chaplain Felipe de los
Reyes died more than two hundred fifty (250) and one hundred fifty (150) years
ago, respectively. The right then to escheat claimed by the municipality has

10

RULE 91: ESCHEAT

existed long prior to the registration proceedings instituted by the Roman

Catholic Archbishop of Manila, and, as the same has not been asserted in said
proceedings, it is deemed to have been completely waived.
Under the Torrens system of registration, claims and liens of whatever
character, except those mentioned by law, existing against the land prior to the
issuance of the certificate of title, are cut off by such certificate if not noted
thereon, and the certificate so issued binds the whole world including the
Government (secs. 38, 39 and 47, Act No. 496; Aldecoa & Co. v. Warner,
Barnes & Co., 30 Phil., 163, 209; Snyder v. Provincial Fiscal of Cebu and Avila,
42 Phil., 761, 765).
Appellant seems to contend that as the properly over which the Roman Catholic
Archbishop of Manila has acquired a certificate of title has never been really
transferred to him by Doa Ana Maria de Araujo, an implied trust has been
created which may be enforced against him in favor of the successors in interest
of said Doa Ana Maria de Araujo. This contention is completely untenable; and,
even assuming it to be right, the appropriate remedy is not a petition in the land
registration proceedings but a separate action. This rule is especially applicable
where, as in the instant case, there are third persons affected, i. e., "El Monte de
Piedad y Caja de Ahorros de Manila," the Asiatic Petroleum Co. (P. I.) , Ltd.,
and the "Padres Redentoristas." It is argued that the transfers made to these
entities are null and void. Be that as it may, the nullity of such transfers cannot
be determined by a motion in the registration proceedings but in a separate
action.
Order is affirmed, with costs against Appellant.
Avancea, C.J., Villa-Real, Imperial, Diaz, Laurel, and Concepcion, JJ., concur.

11

RULE 91: ESCHEAT

G.R. No. 143483

January 31, 2002

REPUBLIC OF THE PHILIPPINES represented by the REGISTER OF DEEDS

OF PASAY CITY, petitioner,
vs.
COURT OF APPEALS (SPECIAL FORMER 3RD DIVISION) AND AMADA H.
SOLANO, assisted by her husband ROMEO SOLANO, respondents.
BELLOSILLO , J.:
This petition for certiorari seeks to nullify two (2) Resolutions of the Court of
Appeals dated 12 November 1998 and 4 May 2000 giving due course to the
petition for annulment of judgment filed by private respondent Amada H. Solano
on 3 February 1997 and denying petitioner's motion for reconsideration.
For more than three (3) decades (from 1952 to 1985) private respondent Amada
Solano served as the all-around personal domestic helper of the late Elizabeth
Hankins, a widow and a French national. During Ms. Hankins' lifetime and most
especially during the waning years of her life, respondent Solano was her faithful
girl Friday and a constant companion since no close relative was available to
tend to her needs.
In recognition of Solano's faithful and dedicated service, Ms. Hankins executed
in her favor two (2) deeds of donation involving two (2) parcels of land covered
by TCT Nos. 7807 and 7808 of the Registry of Deeds. Private respondent
alleged that she misplaced the deeds of donation and were nowhere to be
found.
While the deeds of donation were missing, the Republic filed a petition for the
escheat of the estate of Elizabeth Hankins before the Regional Trial Court of
1
Pasay City. During the proceedings, a motion for intervention was filed by
Romeo Solano, spouse of private respondent, and one Gaudencio Regosa, but
on 24 June 1987 the motion was denied by the trial court for the reason that
2
"they miserably failed to show valid claim or right to the properties in question."
Since it was established that there were no known heirs and persons entitled to
the properties of decedent Hankins, the lower court escheated the estate of the
decedent in favor of petitioner Republic of the Philippines.
By virtue of the decision of the trial court, the Registry of Deeds of Pasay City
cancelled TCT Nos. 7807 and 7808 and issued new ones, TCT Nos. 129551
and 129552, both in the name of Pasay City.
In the meantime, private respondent claimed that she accidentally found the
deeds of donation she had been looking for a long time. In view of this

development, respondent Amada Solano filed on 28 January 1997 a petition

before the Court of Appeals for the annulment of the lower court's decision
3
alleging, among other, that 13.1. The deceased Elizabeth Hankins having donated the subject
properties to the petitioner in 1983 (for TCT No. 7807) and 1984 (for
TCT No. 7808), these properties did not and could not form part of her
estate when she died on September 20, 1985. Consequently, they could
not validly be escheated to the Pasay City Government;
13.2. Even assuming arguendo that the properties could be subject of
escheat proceedings, the decision is still legally infirm for escheating the
properties to an entity, the Pasay City Government, which is not
authorized by law to be the recipient thereof. The property should have
been escheated in favor of the Republic of the Philippines under Rule
91, Section 1 of the New Rules of Court x x x x
On 17 March 1997 the Office of the Solicitor General representing public
respondents RTC and the Register of Deeds (herein petitioner) filed an answer
setting forth their affirmative defenses, to wit: (a) lack of jurisdiction over the
nature of the action; and, (b) the cause of action was barred by the statute of
limitations.
Finding no cogent reason to justify the dismissal of the petition for annulment,
the Court of Appeals issued on 12 November 1998 the first of its assailed
Resolutions giving due course to the petition for annulment of judgment and
setting the date for trial on the merits. In upholding the theory of respondent
Solano, the Appeals Court ruled that Herein petitioner invokes lack of jurisdiction over the subject matter on
the part of respondent RTC to entertain the escheat proceedings x x x
because the parcels of land have been earlier donated to herein
petitioner in 1983 and 1984 prior to the death of said Hankins; and
therefore, respondent court could not have ordered the escheat of said
properties in favor of the Republic of the Philippines, assign them to
respondent Pasay City government, order the cancellation of the old
titles in the name of Hankins and order the properties registered in the
name of respondent Pasay City x x x x The 1997 Rules of Civil
Procedure specifically laid down the grounds of annulment filed before
this Court, to wit: extrinsic fraud and lack of jurisdiction. Jurisdiction over
the subject matter is conferred by law and this jurisdiction is determined
by the allegations of the complaint. It is axiomatic that the averments of
the complaint determine the nature of the action and consequently the
jurisdiction of the courts. Thus whether or not the properties in question

12

RULE 91: ESCHEAT

are no longer part of the estate of the deceased Hankins at the time of
her death; and, whether or not the alleged donations are valid are
issues in the present petition for annulment which can be resolved only
after a full blown trial x x x x
It is for the same reason that respondents espousal of the statute of
limitations against herein petition for annulment cannot prosper at this
stage of the proceedings. Indeed, Section 4, Rule 91 of the Revised
Rules of Court expressly provides that a person entitled to the estate
must file his claim with the court a quo within five (5) years from the date
of said judgment. However, it is clear to this Court that herein petitioner
is not claiming anything from the estate of the deceased at the time of
her death on September 20, 1985; rather she is claiming that the subject
parcels of land should not have been included as part of the estate of
the said decedent as she is the owner thereof by virtue of the deeds of
donation in her favor.
In effect, herein petitioner, who alleges to be in possession of the
premises in question, is claiming ownership of the properties in question
and the consequent reconveyance thereof in her favor which cause of
action prescribes ten (10) years after the issuance of title in favor of
respondent Pasay City on August 7, 1990. Herein petition was
seasonably filed on February 3, 1997 under Article 1144, to wit:
Art. 1144. The following actions must be brought within ten
years from the time the right of action accrues: (1) Upon a
written contract; (2) Upon an obligation created by law; (3) Upon
a judgment.
And Article 1456, to wit:
Art. 1456. If property is acquired through mistake or fraud, the
person obtaining it is, by force of law, considered a trustee of an
implied trust for the benefit of the person from whom the
4
property comes.
In its Resolution of 4 May 2000 the Court of Appeals denied the motion for
reconsideration filed by public respondents Register of Deeds of Pasay City and
the Presiding judge of the lower court and set the trial on the merits for June 15
and 16, 2000.
In its effort to nullify the Resolutions herein before mentioned, petitioner points
out that the Court of Appeals committed grave abuse of discretion amounting to
lack or excess of jurisdiction (a) in denying petitioner's affirmative defenses set

forth in its answer and motion for reconsideration, and in setting the case for trial
and reception of evidence; and, (b) in giving due course to private respondent's
petition for annulment of decision despite the palpable setting-in of the 5-year
statute of limitations within which to file claims before the court a quo set forth in
Rule 91 of the Revised Rules of Court and Art. 1014 of the Civil Code.
Petitioner argues that the lower court had jurisdiction when it escheated the
properties in question in favor of the city government and the filing of a petition
for annulment of judgment on the ground of subsequent discovery of the deeds
of donation did not divest the lower court of its jurisdiction on the matter. It
further contends that Rule 47 of the 1997 Rules of Civil Procedure only provides
for two (2) grounds for the annulment of judgment, namely: extrinsic fraud and
lack of jurisdiction. As such the discovery of the deeds of donation seven (7)
years after the finality of the escheat proceedings is an extraneous matter which
is clearly not an instance of extrinsic fraud nor a ground to oust the lower court
of its jurisdiction.
Petitioner also insists that notwithstanding the execution of the deeds of
donation in favor of private respondent, the 5-year statute of limitations within
which to file claims before the court a quo as set forth in Rule 91 of the Revised
Rules of Court has set in.
The present controversy revolves around the nature of the parcels of land
purportedly donated to private respondent which will ultimately determine
whether the lower court had jurisdiction to declare the same escheated in favor
of the state.
We rule for the petitioner. Escheat is a proceeding, unlike that of succession or
assignment, whereby the state, by virtue of its sovereignty, steps in and claims
the real or personal property of a person who dies intestate leaving no heir. In
the absence of a lawful owner, a property is claimed by the state to forestall an
5
open "invitation to self-service by the first comers." Since escheat is one of the
incidents of sovereignty, the state may, and usually does, prescribe the
conditions and limits the time within which a claim to such property may be
made. The procedure by which the escheated property may be recovered is
generally prescribed by statue, and a time limit is imposed within which such
action must be brought.
In this jurisdiction, a claimant to an escheated property must file his claim "within
five (5) years from the date of such judgment, such person shall have
possession of and title to the same, or if sold, the municipality or city shall be
accountable to him for the proceeds, after deducting the estate; but a claim not
6
made shall be barred forever." The 5-year period is not a device capriciously
conjured by the state to defraud any claimant; on the contrary, it is decidedly

13

RULE 91: ESCHEAT

prescribed to encourage would-be claimants to be punctilious in asserting their

claims, otherwise they may lose them forever in a final judgment.
Incidentally, the question may be asked: Does herein private respondent, not
being an heir but allegedly a donee, have the personality to be a claimant within
the purview of Sec. 4, Rule 91, of the Revised Rules of Court? In this regard, we
agree with the Solicitor General that the case of Municipal Council of San Pedro,
7
Laguna v. Colegio de San Jose, Inc., is applicable at least insofar as it
concerns the Court's discussion on who is an "interested party" in an escheat
proceeding In a special proceeding for escheat under sections 750 and 751 the
petitioner is not the sole and exclusive interested party. Any person
alleging to have a direct right or interest in the property sought to be
escheated is likewise an interested party and may appear and oppose
the petition for escheat. In the present case, the Colegio de San Jose,
Inc. and Carlos Young appeared alleging to have a material interest in
the Hacienda de San Pedro Tunasan; the former because it claims to be
the exclusive owner of the hacienda, and the latter because he claims to
be the lessee thereof under a contract legally entered with the former
(underscoring supplied).
In the instant petition, the escheat judgment was handed down by the lower
court as early as 27 June 1989 but it was only on 28 January 1997, more or less
seven (7) years after, when private respondent decided to contest the escheat
judgment in the guise of a petition for annulment of judgment before the Court of
Appeals. Obviously, private respondent's belated assertion of her right over the
escheated properties militates against recovery.
A judgment in escheat proceedings when rendered by a court of competent
jurisdiction is conclusive against all persons with actual or constructive notice,
but not against those who are not parties or privies thereto. As held in Hamilton
8
v. Brown, "a judgment of escheat was held conclusive upon persons notified by
advertisement to all persons interested. Absolute lack on the part of petitioners
of any dishonest intent to deprive the appellee of any right, or in any way injure
him, constitutes due process of law, proper notice having been observed." With
the lapse of the 5-year period therefore, private respondent has irretrievably lost
her right to claim and the supposed "discovery of the deeds of donation" is not
enough justification to nullify the escheat judgment which has long attained
finality.
In the mind of this Court the subject properties were owned by the decedent
during the time that the escheat proceedings were being conducted and the
lower court was not divested of its jurisdiction to escheat them in favor of Pasay

City notwithstanding an allegation that they had been previously donated. We

recall that a motion for intervention was earlier denied by the escheat court for
9
failure to show "valid claim or right to the properties in question." Where a
person comes into an escheat proceeding as a claimant, the burden is on such
intervenor to establish his title to the property and his right to intervene. A
fortiori, the certificates of title covering the subject properties were in the name
of the decedent indicating that no transfer of ownership involving the disputed
properties was ever made by the deceased during her lifetime. In the absence
therefore of any clear and convincing proof showing that the subject lands had
been conveyed by Hankins to private respondent Solano, the same still
remained, at least before the escheat, part of the estate of the decedent and the
lower court was right not to assume otherwise. The Court of Appeals therefore
cannot perfunctorily presuppose that the subject properties were no longer part
of the decedent's estate at the time the lower court handed down its decision on
the strength of a belated allegation that the same had previously been disposed
of by the owner. It is settled that courts decide only after a close scrutiny of
every piece of evidence and analyze each case with deliberate precision and
unadulterated thoroughness, the judgment not being diluted by speculations,
conjectures and unsubstantiated assertions.
WHEREFORE, the petition is GRANTED. The assailed Resolution of the Court
of Appeals dated 12 November 1998 giving due course to the petition for
annulment of judgment, and its Resolution dated 4 May 2000 denying
petitioner's motion for reconsideration, are SET ASIDE. The decision of the
RTC-Br. 114, Pasay City, dated 27 June 1989, is REINSTATED.
SO ORDERED.
Mendoza,
Quisumbing,
and
De
Leon,
Jr.,
Buena J., no part for being a co-signee of res. in question.

JJ.,

concur.

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