G.R. No. 189538 February 10, 2014
REPUBLIC OF THE PHILIPPINES, Petitioner,
vs.
MERLINDA L. OLAYBAR, Respondent.
DECISION
PERALTA, J.:
Assailed in this petition for review on certiorari under
Rule 45 of the Rules of Court are the Regional Trial
Court1(RTC) Decision2 dated May 5, 2009 and Order3 dated
August 25, 2009 in SP. Proc. No. 16519-CEB. The assailed
decision granted respondent Merlinda L. Olaybar's petition
for cancellation of entries in the latter's marriage contract;
while the assailed order denied the motion for
reconsideration filed by petitioner Republic of the
Philippines through the Office of the Solicitor General
(OSG).
The facts of the case are as follows:
Respondent requested from the National Statistics Office
(NSO) a Certificate of No Marriage (CENOMAR) as one of
the requirements for her marriage with her boyfriend of
five years. Upon receipt thereof, she discovered that she
was already married to a certain Ye Son Sune, a Korean
National, on June 24, 2002, at the Office of the Municipal
Trial Court in Cities (MTCC), Palace of Justice. She denied
having contracted said marriage and claimed that she did
not know the alleged husband; she did not appear before
the solemnizing officer; and, that the signature appearing
in the marriage certificate is not hers.4 She, thus, filed a
Petition for Cancellation of Entries in the Marriage
Contract, especially the entries in the wife portion
thereof.5 Respondent impleaded the Local Civil Registrar of
Cebu City, as well as her alleged husband, as parties to the
case.
During trial, respondent testified on her behalf and
explained that she could not have appeared before Judge
Mamerto Califlores, the supposed solemnizing officer, at
the time the marriage was allegedly celebrated, because
she was then in Makati working as a medical distributor in
Hansao Pharma. She completely denied having known the
supposed husband, but she revealed that she recognized
the named witnesses to the marriage as she had met them
while she was working as a receptionist in Tadels Pension
House. She believed that her name was used by a certain
Johnny Singh, who owned a travel agency, whom she gave
her personal circumstances in order for her to obtain a
passport.6 Respondent also presented as witness a certain
Eufrocina Natinga, an employee of MTCC, Branch 1, who
confirmed that the marriage of Ye Son Sune was indeed
celebrated in their office, but claimed that the alleged wife
who appeared was definitely not respondent.7 Lastly, a
document examiner testified that the signature appearing
in the marriage contract was forged.8
On May 5, 2009, the RTC rendered the assailed Decision,
the dispositive portion of which reads:
WHEREFORE, judgment is hereby rendered, the petition is
granted in favor of the petitioner, Merlinda L. Olaybar. The
Local Civil Registrar of Cebu City is directed to cancel all
the entries in the WIFE portion of the alleged marriage
contract of the petitioner and respondent Ye Son Sune.
Rule 72: Subject Matter and Applicability of General Rules
SO ORDERED.
Finding that the signature appearing in the subject
marriage contract was not that of respondent, the court
found basis in granting the latters prayer to straighten her
record and rectify the terrible mistake.10
Petitioner, however, moved for the reconsideration of the
assailed Decision on the grounds that: (1) there was no
clerical spelling, typographical and other innocuous errors
in the marriage contract for it to fall within the provisions
of Rule 108 of the Rules of Court; and (2) granting the
cancellation of all the entries in the wife portion of the
alleged marriage contract is, in effect, declaring the
marriage void ab initio.11
In an Order dated August 25, 2009, the RTC denied
petitioners motion for reconsideration couched in this
wise:
WHEREFORE, the court hereby denies the Motion for
Reconsideration filed by the Republic of the Philippines.
Furnish copies of this order to the Office of the Solicitor
General, the petitioners counsel, and all concerned
government agencies.
SO ORDERED.12
Contrary to petitioners stand, the RTC held that it had
jurisdiction to take cognizance of cases for correction of
entries even on substantial errors under Rule 108 of the
Rules of Court being the appropriate adversary proceeding
required. Considering that respondents identity was used
by an unknown person to contract marriage with a Korean
national, it would not be feasible for respondent to
institute an action for declaration of nullity of marriage
since it is not one of the void marriages under Articles 35
and 36 of the Family Code.13
Petitioner now comes before the Court in this Petition for
Review on Certiorari under Rule 45 of the Rules of Court
seeking the reversal of the assailed RTC Decision and
Order based on the following grounds:
I.
RULE 108 OF THE REVISED RULES OF COURT APPLIES
ONLY WHEN THERE ARE ERRORS IN THE ENTRIES
SOUGHT TO BE CANCELLED OR CORRECTED.
II.
GRANTING THE CANCELLATION OF "ALL THE ENTRIES IN
THE WIFE PORTION OF THE ALLEGED MARRIAGE
CONTRACT," IS IN EFFECT DECLARING THE MARRIAGE
VOID AB INITIO.14
Petitioner claims that there are no errors in the entries
sought to be cancelled or corrected, because the entries
made in the certificate of marriage are the ones provided
by the person who appeared and represented herself as
Merlinda L. Olaybar and are, in fact, the latters personal
circumstances.15 In directing the cancellation of the entries
in the wife portion of the certificate of marriage, the RTC,
in effect, declared the marriage null and void ab
initio.16 Thus, the petition instituted by respondent is
actually a petition for declaration of nullity of marriage in
the guise of a Rule 108 proceeding.17
Page 1
We deny the petition.
At the outset, it is necessary to stress that a direct recourse
to this Court from the decisions and final orders of the RTC
may be taken where only questions of law are raised or
involved. There is a question of law when the doubt arises
as to what the law is on a certain state of facts, which does
not call for the examination of the probative value of the
evidence of the parties.18 Here, the issue raised by
petitioner is whether or not the cancellation of entries in
the marriage contract which, in effect, nullifies the
marriage may be undertaken in a Rule 108 proceeding.
Verily, petitioner raised a pure question of law.
Rule 108 of the Rules of Court sets forth the rules on
cancellation or correction of entries in the civil registry, to
wit:
SEC. 1. Who may file petition. Any person
interested in any act, event, order or decree
concerning the civil status of persons which has
been recorded in the civil register, may file a
verified petition for the cancellation or correction
of any entry relating thereto, with the Regional
Trial Court of the province where the
corresponding civil registry is located.
SEC. 2. Entries subject to cancellation or
correction. Upon good and valid grounds, the
following entries in the civil register may be
cancelled or corrected: (a) births; (b) marriages;
(c) deaths; (d) legal separations; (e) judgments of
annulments of marriage; (f) judgments declaring
marriages void from the beginning; (g)
legitimations; (h) adoptions; (i) acknowledgments
of natural children; (j) naturalization; (k) election,
loss or recovery of citizenship; (l) civil
interdiction; (m) judicial determination of
filiation; (n) voluntary emancipation of a minor;
and (o) changes of name.
SEC. 3. Parties. When cancellation or correction
of an entry in the civil register is sought, the civil
registrar and all persons who have or claim any
interest which would be affected thereby shall be
made parties to the proceeding.
SEC. 4. Notice and Publication. Upon the filing of
the petition, the court shall, by an order, fix the
time and place for the hearing of the same, and
cause reasonable notice thereof to be given to the
persons named in the petition. The court shall also
cause the order to be published once a week for
three (3) consecutive weeks in a newspaper of
general circulation in the province.
SEC. 5. Opposition. The civil registrar and any
person having or claiming any interest under the
entry whose cancellation or correction is sought
may, within fifteen (15) days from notice of the
petition, or from the last date of publication of
such notice, file his opposition thereto.
SEC. 6. Expediting proceedings. The court in
which the proceedings is brought may make
orders expediting the proceedings, and may also
grant preliminary injunction for the preservation
of the rights of the parties pending such
proceedings.
Rule 72: Subject Matter and Applicability of General Rules
SEC. 7. Order. After hearing, the court may either
dismiss the petition or issue an order granting the
cancellation or correction prayed for. In either
case, a certified copy of the judgment shall be
served upon the civil registrar concerned who
shall annotate the same in his record.
Rule 108 of the Rules of Court provides the procedure for
cancellation or correction of entries in the civil registry.
The proceedings may either be summary or adversary. If
the correction is clerical, then the procedure to be adopted
is summary. If the rectification affects the civil status,
citizenship or nationality of a party, it is deemed
substantial, and the procedure to be adopted is adversary.
Since the promulgation of Republic v. Valencia19 in 1986,
the Court has repeatedly ruled that "even substantial
errors in a civil registry may be corrected through a
petition filed under Rule 108, with the true facts
established and the parties aggrieved by the error availing
themselves of the appropriate adversarial
proceeding."20 An appropriate adversary suit or
proceeding is one where the trial court has conducted
proceedings where all relevant facts have been fully and
properly developed, where opposing counsel have been
given opportunity to demolish the opposite partys case,
and where the evidence has been thoroughly weighed and
considered.21
It is true that in special proceedings, formal pleadings and
a hearing may be dispensed with, and the remedy [is]
granted upon mere application or motion. However, a
special proceeding is not always summary. The procedure
laid down in Rule 108 is not a summary proceeding per se.
It requires publication of the petition; it mandates the
inclusion as parties of all persons who may claim interest
which would be affected by the cancellation or correction;
it also requires the civil registrar and any person in
interest to file their opposition, if any; and it states that
although the court may make orders expediting the
proceedings, it is after hearing that the court shall either
dismiss the petition or issue an order granting the same.
Thus, as long as the procedural requirements in Rule 108
are followed, it is the appropriate adversary proceeding to
effect substantial corrections and changes in entries of the
civil register.22
In this case, the entries made in the wife portion of the
certificate of marriage are admittedly the personal
circumstances of respondent. The latter, however, claims
that her signature was forged and she was not the one who
contracted marriage with the purported husband. In other
words, she claims that no such marriage was entered into
or if there was, she was not the one who entered into such
contract. It must be recalled that when respondent tried to
obtain a CENOMAR from the NSO, it appeared that she was
married to a certain Ye Son Sune. She then sought the
cancellation of entries in the wife portion of the marriage
certificate.
In filing the petition for correction of entry under Rule 108,
respondent made the Local Civil Registrar of Cebu City, as
well as her alleged husband Ye Son Sune, as parties-
respondents. It is likewise undisputed that the procedural
requirements set forth in Rule 108 were complied with.
The Office of the Solicitor General was likewise notified of
the petition which in turn authorized the Office of the City
Prosecutor to participate in the proceedings. More
importantly, trial was conducted where respondent
herself, the stenographer of the court where the alleged
marriage was conducted, as well as a document examiner,
Page 2
testified. Several documents were also considered as
evidence. With the testimonies and other evidence
presented, the trial court found that the signature
appearing in the subject marriage certificate was different
from respondents signature appearing in some of her
government issued identification cards.23 The court thus
made a categorical conclusion that respondents signature
in the marriage certificate was not hers and, therefore, was
forged. Clearly, it was established that, as she claimed in
her petition, no such marriage was celebrated.
Indeed the Court made a pronouncement in the recent
case of Minoru Fujiki v. Maria Paz Galela Marinay, Shinichi
Maekara, Local Civil Registrar of Quezon City, and the
Administrator and Civil Registrar General of the National
Statistics Office24 that:
To be sure, a petition for correction or cancellation of an
entry in the civil registry cannot substitute for an action to
invalidate a marriage. A direct action is necessary to
prevent circumvention of the substantive and procedural
safeguards of marriage under the Family Code, A.M. No.
02-11-10-SC and other related laws. Among these
safeguards are the requirement of proving the limited
grounds for the dissolution of marriage, support pendente
lite of the spouses and children, the liquidation, partition
and distribution of the properties of the spouses and the
investigation of the public prosecutor to determine
collusion. A direct action for declaration of nullity or
annulment of marriage is also necessary to prevent
circumvention of the jurisdiction of the Family Courts
under the Family Courts Act of 1997 (Republic Act No.
8369), as a petition for cancellation or correction of entries
in the civil registry may be filed in the Regional Trial Court
where the corresponding civil registry is located. In other
words, a Filipino citizen cannot dissolve his marriage by
the mere expedient of changing his entry of marriage in
the civil registry.
Aside from the certificate of marriage, no such evidence
was presented to show the existence of
marriage.1wphi1Rather, respondent showed by
overwhelming evidence that no marriage was entered into
and that she was not even aware of such existence. The
testimonial and documentary evidence clearly established
that the only "evidence" of marriage which is the marriage
certificate was a forgery. While we maintain that Rule 108
cannot be availed of to determine the validity of marriage,
we cannot nullify the proceedings before the trial court
where all the parties had been given the opportunity to
contest the allegations of respondent; the procedures were
followed, and all the evidence of the parties had already
been admitted and examined. Respondent indeed sought,
not the nullification of marriage as there was no marriage
to speak of, but the correction of the record of such
marriage to reflect the truth as set forth by the evidence.
Otherwise stated, in allowing the correction of the subject
certificate of marriage by cancelling the wife portion
thereof, the trial court did not, in any way, declare the
marriage void as there was no marriage to speak of.
WHEREFORE, premises considered, the petition is DENIED
for lack of merit. The Regional Trial Court Decision dated
May 5, 2009 and Order dated August 25, 2009 in SP. Proc.
No. 16519-CEB, are AFFIRMED.
SO ORDERED.
G.R. No. 170498 January 9, 2013
Rule 72: Subject Matter and Applicability of General Rules
METROPOLITAN BANK & TRUST COMPANY, Petitioner,
vs.
ABSOLUTE MANAGEMENT CORPORATION, Respondent.
DECISION
BRION, J.:
We resolve petitioner Metropolitan Bank & Trust
Company's (Metro bank's) petition for review on
certiorari1seeking the reversal of the decision2 dated
August 25, 2005 and the resolution3 dated November 17,
2005 of the Court of Appeals (CA) in CA-G.R. SP No. 86336.
The assailed decision affirmed the order4 dated May 7,
2004 of the Regional Trial Court (RTC) of Quezon City,
Branch 80. The RTC had denied the admission of
Metrobank's Fourth-Party Complaint5 against the Estate of
Jose L. Chua for being a money claim that falls under
Section 5, Rule 86 of the Rules of Court; the claim should
have been filed in the pending judicial settlement of Chuas
estate before the RTC of Pasay City. The CA affirmed the
RTCs order based on the same ground.
Factual Antecedents
On October 5, 2000, Sherwood Holdings Corporation, Inc.
(SHCI) filed a complaint for sum of money against Absolute
Management Corporation (AMC). The complaint was
docketed as Civil Case No. Q-00-42105 and was assigned to
the RTC of Quezon City, Branch 80.6
SHCI alleged in its complaint that it made advance
payments to AMC for the purchase of 27,000 pieces of
plywood and 16,500 plyboards in the sum
of P12,277,500.00, covered by Metrobank Check Nos.
1407668502, 140768507, 140768530, 140768531,
140768532, 140768533 and 140768534. These checks
were all crossed, and were all made payable to AMC. They
were given to Chua, AMCs General Manager, in 1998.7
Chua died in 1999, 8 and a special proceeding for the
settlement of his estate was commenced before the RTC of
Pasay City. This proceeding was pending at the time AMC
filed its answer with counterclaims and third-party
complaint.9
SHCI made demands on AMC, after Chuas death, for
allegedly undelivered items worth P8,331,700.00.
According to AMC, these transactions could not be found in
its records. Upon investigation, AMC discovered that in
1998, Chua received from SHCI 18 Metrobank checks
worth P31,807,500.00. These were all payable to AMC and
were crossed or "for payees account only."10
In its answer with counterclaims and third-party
complaint,11 AMC averred that it had no knowledge of
Chuas transactions with SHCI and it did not receive any
money from the latter. AMC also asked the RTC to hold
Metrobank liable for the subject checks in case it is
adjudged liable to SHCI.
Metrobank filed a motion for bill of particulars, 12 seeking
to clarify certain ambiguous statements in AMCs answer.
The RTC granted the motion but AMC failed to submit the
required bill of particulars. Hence, Metrobank filed a
motion to strike out the third-party complaint.13
In the meantime, Metrobank filed a motion to
dismiss14 against AMC on the ground that the latter
engaged in prohibited forum shopping. According to
Metrobank, AMCs claim against it is the same claim that it
raised against Chuas estate in Special Proceedings No. 99-
Page 3
0023 before the RTC of Pasay City, Branch 112. The RTC
subsequently denied this motion.15
The RTC of Quezon City opted to defer consideration16 of
Metrobanks motion to strike out third-party
complaint17 and it instead granted AMCs motion for leave
to serve written interrogatories on the third-party
defendant.18 While Metrobank filed its answer to the
written interrogatories, AMC was again directed by the
RTC, in an order19 dated August 13, 2003, to submit its bill
of particulars. Instead, AMC filed a motion for
reconsideration20 which was denied in an order21 dated
October 28, 2003. AMC still did not file its bill of
particulars. The RTC, on the other hand, did not act on
Metrobanks motion to strike out AMCs third-party
complaint.22
In its answer23 dated December 1, 2003, Metrobank
admitted that it deposited the checks in question to the
account of Ayala Lumber and Hardware, a sole
proprietorship Chua owned and managed. The deposit was
allegedly done with the knowledge and consent of AMC.
According to
Metrobank, Chua then gave the assurance that the
arrangement for the handling of the checks carried AMCs
consent. Chua also submitted documents showing his
position and interest in AMC. These documents, as well as
AMCs admission in its answer that it allowed Chua to
manage AMC with a relative free hand, show that it knew
of Chuas arrangement with Metrobank. Further, Chuas
records show that the proceeds of the checks were
remitted to AMC which cannot therefore now claim that it
did not receive these proceeds.
Metrobank also raised the defense of estoppel. According
to Metrobank, AMC had knowledge of its arrangements
with Chua for several years. Despite this arrangement,
AMC did not object to nor did it call the attention of
Metrobank about Chuas alleged lack of authority to
deposit the checks in Ayala Lumber and Hardwares
account. At this point, AMC is already estopped from
questioning Chuas authority to deposit these checks in
Ayala Lumber and Hardwares account.
Lastly, Metrobank asserted that AMC gave Chua unbridled
control in managing AMCs affairs. This measure of control
amounted to gross negligence that was the proximate
cause of the loss that AMC must now bear.
Subsequently, Metrobank filed a motion for leave to admit
fourth-party complaint24 against Chuas estate. It alleged
that Chuas estate should reimburse Metrobank in case it
would be held liable in the third-party complaint filed
against it by AMC.
The RTCs Ruling
In an order25 dated May 7, 2004, the RTC denied
Metrobanks motion. It likewise denied Metrobanks
motion for reconsideration in an order26 dated July 7,
2004.
The RTC categorized Metrobanks allegation in the fourth-
party complaint as a "cobro de lo indebido" 27 a kind of
quasi-contract that mandates recovery of what has been
improperly paid. Quasi-contracts fall within the concept of
implied contracts that must be included in the claims
required to be filed with the judicial settlement of the
deceaseds estate under Section 5, Rule 86 of the Rules of
Court. As such claim, it should have been filed in Special
Proceedings No. 99-0023, not before the RTC as a fourth-
Rule 72: Subject Matter and Applicability of General Rules
party complaint. The RTC, acting in the exercise of its
general jurisdiction, does not have the authority to
adjudicate the fourth-party complaint. As a trial court
hearing an ordinary action, it cannot resolve matters
pertaining to special proceedings because the latter is
subject to specific rules.
Metrobank responded to the RTC ruling by filing a petition
for certiorari28 under Rule 65 before the CA.
The CAs Ruling
The CA affirmed the RTCs ruling that Metrobanks fourth-
party complaint should have been filed in Special
Proceedings No. 99-0023.29 According to the CA, the relief
that Metrobank prayed for was based on a quasi-contract
and was a money claim categorized as an implied contract
that should be filed under Section 5, Rule 86 of the Rules of
Court.
Based on the statutory construction principle of lex
specialis derogat generali, the CA held that Section 5, Rule
86 of the Rules of Court is a special provision that should
prevail over the general provisions of Section 11, Rule 6 of
the Rules of Court. The latter applies to money claims in
ordinary actions while a money claim against a person
already deceased falls under the settlement of his estate
that is governed by the rules on special proceedings. If at
all, rules for ordinary actions only apply suppletorily to
special proceedings.
The Present Petition
In its present petition for review on
certiorari,30 Metrobank asserts that it should be allowed to
file a fourth-party complaint against Chuas estate in the
proceedings before the RTC; its fourth-party complaint
was filed merely to enforce its right to be reimbursed by
Chuas estate in case Metrobank is held liable to AMC.
Hence, Section 11, Rule 6 of the Rules of Court should
apply.
AMC, in its comment,31 maintains the line that the CA and
the RTC rulings should be followed, i.e., that Metrobanks
claim is a quasi-contract that should be filed as a claim
under Section 5, Rule 86 of the Rules of Court.
AMC also challenges the form of Metrobanks petition for
failure to comply with Section 4, Rule 45 of the Rules of
Court. This provision requires petitions filed before the
Supreme Court to be accompanied by "such material
portions of the record as would support the petition."
According to AMC, the petitions annexes are mostly
Metrobanks pleadings and court issuances. It did not
append all relevant AMC pleadings before the RTC and the
CA. For this reason, the petition should have been
dismissed outright.
Issues
The parties arguments, properly joined, present to us the
following issues:
1) Whether the petition for review on certiorari filed by
Metrobank before the Supreme Court complies with
Section 4, Rule 45 of the Rules of Court; and
2) Whether Metrobanks fourth-party complaint against
Chuas estate should be allowed.
The Courts Ruling
Page 4
The Present Petition Complies With Section 4, Rule 45 of
the Rules of Court
AMC posits that Metrobanks failure to append relevant
AMC pleadings submitted to the RTC and to the CA violated
Section 4, Rule 45 of the Rules of Court,32 and is a sufficient
ground to dismiss the petition under Section 5, Rule 45 of
the Rules of Court.33
We disagree with AMCs position.
In F.A.T. Kee Computer Systems, Inc. v. Online Networks
International, Inc.,34 Online Networks International, Inc.
similarly assailed F.A.T. Kee Computer Systems, Inc.s
failure to attach the transcript of stenographic notes (TSN)
of the RTC proceedings, and claimed this omission to be a
violation of Section 4, Rule 45 of the Rules of Court that
warranted the petitions dismissal. The Court held that the
defect was not fatal, as the TSN of the proceedings before
the RTC forms part of the records of the case. Thus, there
was no incurable omission that warranted the outright
dismissal of the petition.
The Court significantly pointed out in F.A.T. Kee that the
requirement in Section 4, Rule 45 of the Rules of Court is
not meant to be an absolute rule whose violation would
automatically lead to the petitions dismissal.35 The Rules
of Court has not been intended to be totally rigid. In fact,
the Rules of Court provides that the Supreme Court "may
require or allow the filing of such pleadings, briefs,
memoranda or documents as it may deem necessary
within such periods and under such conditions as it may
consider appropriate";36 and "[i]f the petition is given due
course, the Supreme Court may require the elevation of the
complete record of the case or specified parts thereof
within fifteen (15) days from notice."37 These provisions
are in keeping with the overriding standard that
procedural rules should be liberally construed to promote
their objective and to assist the parties in obtaining a just,
speedy and inexpensive determination of every action or
proceeding.38
Under this guiding principle, we do not see Metrobanks
omission to be a fatal one that should warrant the
petitions outright dismissal. To be sure, the omission to
submit the adverse partys pleadings in a petition before
the Court is not a commendable practice as it may lead to
an unduly biased narration of facts and arguments that
masks the real issues before the Court. Such skewed
presentation could lead to the waste of the Courts time in
sifting through the maze of the parties narrations of facts
and arguments and is a danger the Rules of Court seeks to
avoid.
Our examination of Metrobanks petition shows that it
contains AMCs opposition to its motion to admit fourth-
party complaint among its annexes. The rest of the
pleadings have been subsequently submitted as
attachments in Metrobanks Reply. A reading of these
pleadings shows that their arguments are the same as
those stated in the orders of the trial court and the Court of
Appeals. Thus, even if Metrobanks petition did not contain
some of AMCs pleadings, the Court still had the benefit of a
clear narration of facts and arguments according to both
parties perspectives. In this broader view, the mischief
that the Rules of Court seeks to avoid has not really been
present. If at all, the omission is not a grievous one that the
spirit of liberality cannot address.
The Merits of the Main Issue
Rule 72: Subject Matter and Applicability of General Rules
The main issue poses to us two essential points that must
be addressed. First, are quasi-contracts included in claims
that should be filed pursuant to Rule 86, Section 5 of the
Rules of Court? Second, if so, is Metrobanks claim against
the Estate of Jose Chua based on a quasi-contract?
Quasi-contracts are included in
claims that should be filed under Rule
86, Section 5 of the Rules of Court
In Maclan v. Garcia,39 Gabriel Maclan filed a civil case to
recover from Ruben Garcia the necessary expenses he
spent as possessor of a piece of land. Garcia acquired the
land as an heir of its previous owner. He set up the defense
that this claim should have been filed in the special
proceedings to settle the estate of his predecessor. Maclan,
on the other hand, contended that his claim arises from
law and not from contract, express or implied. Thus, it
need not be filed in the settlement of the estate of Garcias
predecessor, as mandated by Section 5, Rule 87 of the
Rules of Court (now Section 5, Rule 86).
The Court held under these facts that a claim for necessary
expenses spent as previous possessor of the land is a kind
of quasi-contract. Citing Leung Ben v. OBrien, 40 it
explained that the term "implied contracts," as used in our
remedial law, originated from the common law where
obligations derived from quasi-contracts and from law are
both considered as implied contracts. Thus, the term
quasi-contract is included in the concept "implied
contracts" as used in the Rules of Court. Accordingly,
liabilities of the deceased arising from quasi-contracts
should be filed as claims in the settlement of his estate, as
provided in Section 5, Rule 86 of the Rules of Court.41
Metrobanks fourth-party complaint is
based on quasi-contract
Both the RTC and the CA described Metrobanks claim
against Chuas estate as one based on quasi-contract. A
quasi-contract involves a juridical relation that the law
creates on the basis of certain voluntary, unilateral and
lawful acts of a person, to avoid unjust enrichment.42 The
Civil Code provides an enumeration of quasi-
contracts,43 but the list is not exhaustive and merely
provides examples.44
According to the CA, Metrobanks fourth-party complaint
falls under the quasi-contracts enunciated in Article 2154
of the Civil Code.45 Article 2154 embodies the concept
"solutio indebiti" which arises when something is
delivered through mistake to a person who has no right to
demand it. It obligates the latter to return what has been
received through mistake.46
Solutio indebiti, as defined in Article 2154 of the Civil
Code, has two indispensable requisites: first, that
something has been unduly delivered through mistake;
and second, that something was received when there was
no right to demand it.47
In its fourth-party complaint, Metrobank claims that
Chuas estate should reimburse it if it becomes liable on
the checks that it deposited to Ayala Lumber and
Hardwares account upon Chuas instructions.
This fulfills the requisites of solutio indebiti. First,
Metrobank acted in a manner akin to a mistake when it
deposited the AMC checks to Ayala Lumber and
Hardwares account; because of Chuas control over AMCs
operations, Metrobank assumed that the checks payable to
AMC could be deposited to Ayala Lumber and Hardwares
Page 5
account. Second, Ayala Lumber and Hardware had no right
to demand and receive the checks that were deposited to
its account; despite Chuas control over AMC and Ayala
Lumber and Hardware, the two entities are distinct, and
checks exclusively and expressly payable to one cannot be
deposited in the account of the other. This disjunct created
an obligation on the part of Ayala Lumber and Hardware,
through its sole proprietor, Chua, to return the amount of
these checks to Metrobank.
The Court notes, however, that its description of
Metrobanks fourth-party complaint as a claimclosely
analogous to solutio indebiti is only to determine the
validity of the lower courts orders denying it. It is not an
adjudication determining the liability of Chuas estate
against Metrobank. The appropriate trial court should still
determine whether Metrobank has a lawful claim against
Chuas estate based on quasi-contract.1wphi1
Metrobanks fourth-party complaint,
as a contingent claim, falls within the
claims that should be filed under
Section 5, Rule 86 of the Rules of
Court
A distinctive character of Metrobanks fourth-party
complaint is its contingent nature the claim depends on
the possibility that Metrobank would be adjudged liable to
AMC, a future event that may or may not happen. This
characteristic unmistakably marks the complaint as a
contingent one that must be included in the claims falling
under the terms of Section 5, Rule 86 of the Rules of Court:
Sec. 5. Claims which must be filed under the notice. If not
filed, barred; exceptions. All claims for money against the
decedent, arising from contract, express or implied,
whether the same be due, not due, or contingent, all claims
for funeral expenses and expenses for the last sickness of
the decedent, and judgment for money against the
decedent, must be filed within the time limited in the
notice. [italics ours]
Specific provisions of Section 5, Rule
86 of the Rules of Court prevail over
general provisions of Section 11, Rule
6 of the Rules of Court
Metrobank argues that Section 11, Rule 6 of the Rules of
Court should apply because it impleaded Chuas estate for
reimbursement in the same transaction upon which it has
been sued by AMC. On this point, the Court supports the
conclusion of the CA, to wit:
Notably, a comparison of the respective provisions of
Section 11, Rule 6 and Section 5, Rule 86 of the Rules of
Court readily shows that Section 11, Rule 6 applies to
ordinary civil actions while Section 5, Rule 86 specifically
applies to money claims against the estate. The specific
provisions of Section 5, Rule 86 x x x must therefore
prevail over the general provisions of Section 11, Rule 6. 48
We read with approval the CAs use of the statutory
construction principle of lex specialis derogat generali,
leading to the conclusion that the specific provisions of
Section 5, Rule 86 of the Rules of Court should prevail over
the general provisions of Section 11, Rule 6 of the Rules of
Court; the settlement of the estate of deceased persons
(where claims against the deceased should be filed) is
primarily governed by the rules on special proceedings,
while the rules provided for ordinary claims, including
Section 11, Rule 6 ofthe Rules of Court, merely apply
suppletorily.49
Rule 72: Subject Matter and Applicability of General Rules
In sum, on all counts in the considerations material to the
issues posed, the resolution points to the affirmation of the
assailed CA decision and resolution. Metrobank's claim in
its fourth-party complaint against Chua's estate is based on
quasi-contract. It is also a contingent claim that depends
on another event. Both belong to the category of claims
against a deceased person that should be filed under
Section 5, Rule 86 of the Rules of Comi and, as such, should
have been so filed in Special Proceedings No. 99-0023.
WHEREFORE, premises considered, we hereby DENY the
petition for lack of merit. The decision of the Court of
Appeals dated August 25, 2005, holding that the Regional
Trial Court of Quezon City, Branch 80, did not commit
grave abuse of discretion in denying Metropolitan Bank &
Trust Company's motion for leave to admit fourth-party
complaint Is
AFFIRMED. Costs against Metropolitan Bank & Trust
Company.
SO ORDERED.
G.R. No. 174975 January 20, 2009
LUISA KHO MONTAER, ALEJANDRO MONTAER, JR.,
LILLIBETH MONTAER-BARRIOS, AND RHODORA
ELEANOR MONTAER-DALUPAN, Petitioners,
vs.
SHARI'A DISTRICT COURT, FOURTH SHARI'A JUDICIAL
DISTRICT, MARAWI CITY, LILING DISANGCOPAN, AND
ALMAHLEEN LILING S. MONTAER, Respondents.
DECISION
PUNO, C.J.:
This Petition for Certiorari and Prohibition seeks to set
aside the Orders of the Sharia District Court, Fourth
Sharia Judicial District, Marawi City, dated August 22,
20061 and September 21, 2006.2
On August 17, 1956, petitioner Luisa Kho Montaer, a
Roman Catholic, married Alejandro Montaer, Sr. at the
Immaculate Conception Parish in Cubao, Quezon
City.3 Petitioners Alejandro Montaer, Jr., Lillibeth
Montaer-Barrios, and Rhodora Eleanor Montaer-
Dalupan are their children.4 On May 26, 1995, Alejandro
Montaer, Sr. died.5
On August 19, 2005, private respondents Liling
Disangcopan and her daughter, Almahleen Liling S.
Montaer, both Muslims, filed a "Complaint" for the
judicial partition of properties before the Sharia District
Court.6 The said complaint was entitled "Almahleen Liling
S. Montaer and Liling M. Disangcopan v. the Estates and
Properties of Late Alejandro Montaer, Sr., Luisa Kho
Montaer, Lillibeth K. Montaer, Alejandro Kho Montaer,
Jr., and Rhodora Eleanor K. Montaer," and docketed as
"Special Civil Action No. 7-05."7 In the said complaint,
private respondents made the following allegations: (1) in
May 1995, Alejandro Montaer, Sr. died; (2) the late
Alejandro Montaer, Sr. is a Muslim; (3) petitioners are the
first family of the decedent; (4) Liling Disangcopan is the
widow of the decedent; (5) Almahleen Liling S. Montaer is
the daughter of the decedent; and (6) the estimated value
of and a list of the properties comprising the estate of the
decedent.8 Private respondents prayed for the Sharia
District Court to order, among others, the following: (1)
the partition of the estate of the decedent; and (2) the
appointment of an administrator for the estate of the
decedent.9
Page 6
Petitioners filed an Answer with a Motion to Dismiss
mainly on the following grounds: (1) the Sharia District
Court has no jurisdiction over the estate of the late
Alejandro Montaer, Sr., because he was a Roman Catholic;
(2) private respondents failed to pay the correct amount of
docket fees; and (3) private respondents complaint is
barred by prescription, as it seeks to establish filiation
between Almahleen Liling S. Montaer and the decedent,
pursuant to Article 175 of the Family Code.10
On November 22, 2005, the Sharia District Court
dismissed the private respondents complaint. The district
court held that Alejandro Montaer, Sr. was not a Muslim,
and its jurisdiction extends only to the settlement and
distribution of the estate of deceased Muslims.11
On December 12, 2005, private respondents filed a Motion
for Reconsideration.12 On December 28, 2005, petitioners
filed an Opposition to the Motion for Reconsideration,
alleging that the motion for reconsideration lacked a notice
of hearing.13 On January 17, 2006, the Sharia District Court
denied petitioners opposition.14Despite finding that the
said motion for reconsideration "lacked notice of hearing,"
the district court held that such defect was cured as
petitioners "were notified of the existence of the pleading,"
and it took cognizance of the said motion.15 The Sharia
District Court also reset the hearing for the motion for
reconsideration.16
In its first assailed order dated August 22, 2006, the Sharia
District Court reconsidered its order of dismissal dated
November 22, 2005.17 The district court allowed private
respondents to adduce further evidence.18 In its second
assailed order dated September 21, 2006, the Sharia
District Court ordered the continuation of trial, trial on the
merits, adducement of further evidence, and pre-trial
conference.19
Seeking recourse before this Court, petitioners raise the
following issues:
I.
RESPONDENT SHARIA DISTRICT COURT MARAWI CITY
LACKS JURISDICTION OVER PETITIONERS WHO ARE
ROMAN CATHOLICS AND NON-MUSLIMS.
II.
RESPONDENT SHARIA DISTRICT COURT MARAWI CITY
DID NOT ACQUIRE JURISDICTION OVER "THE ESTATES
AND PROPERTIES OF THE LATE ALEJANDRO MONTAER,
SR." WHICH IS NOT A NATURAL OR JURIDICAL PERSON
WITH CAPACITY TO BE SUED.
III.
RESPONDENT SHARIA DISTRICT COURT DID NOT
ACQUIRE JURISDICTION OVER THE COMPLAINT OF
PRIVATE RESPONDENTS AGAINST PETITIONERS DUE TO
NON-PAYMENT OF THE FILING AND DOCKETING FEES.
IV.
RESPONDENT SHARIA DISTRICT COURTMARAWI CITY
COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING
TO LACK OF JURISDICTION WHEN IT DENIED THE
OPPOSITION OF PETITIONERS AND THEN GRANTED THE
MOTION FOR RECONSIDERATION OF RESPONDENTS
LILING DISANGCOPAN, ET AL. WHICH WAS FATALLY
DEFECTIVE FOR LACK OF A "NOTICE OF HEARING."
Rule 72: Subject Matter and Applicability of General Rules
V.
RESPONDENT SHARIA DISTRICT COURTMARAWI CITY
COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING
TO LACK OF JURISDICTION WHEN IT SET SPL. CIVIL
ACTION 7-05 FOR TRIAL EVEN IF THE COMPLAINT
PLAINLY REVEALS THAT RESPONDENT ALMAHLEEN
LILING S. MONTAER SEEKS RECOGNITION FROM
ALEJANDRO MONTAER, SR. WHICH CAUSE OF ACTION
PRESCRIBED UPON THE DEATH OF ALEJANDRO
MONTAER, SR. ON MAY 26, 1995.
In their Comment to the Petition for Certiorari, private
respondents stress that the Sharia District Court must be
given the opportunity to hear and decide the question of
whether the decedent is a Muslim in order to determine
whether it has jurisdiction.20
Jurisdiction: Settlement of the Estate of Deceased Muslims
Petitioners first argument, regarding the Sharia District
Courts jurisdiction, is dependent on a question of fact,
whether the late Alejandro Montaer, Sr. is a Muslim.
Inherent in this argument is the premise that there has
already been a determination resolving such a question of
fact. It bears emphasis, however, that the assailed orders
did not determine whether the decedent is a Muslim. The
assailed orders did, however, set a hearing for the purpose
of resolving this issue.
Article 143(b) of Presidential Decree No. 1083, otherwise
known as the Code of Muslim Personal Laws of the
Philippines, provides that the Sharia District Courts have
exclusive original jurisdiction over the settlement of the
estate of deceased Muslims:
ARTICLE 143. Original jurisdiction. (1) The Shari'a
District Court shall have exclusive original jurisdiction
over:
xxxx
(b) All cases involving disposition, distribution and
settlement of the estate of deceased Muslims, probate of
wills, issuance of letters of administration or appointment
of administrators or executors regardless of the nature or
the aggregate value of the property.
The determination of the nature of an action or proceeding
is controlled by the averments and character of the relief
sought in the complaint or petition.21 The designation
given by parties to their own pleadings does not
necessarily bind the courts to treat it according to the said
designation. Rather than rely on "a falsa descriptio or
defective caption," courts are "guided by the substantive
averments of the pleadings."22
Although private respondents designated the pleading
filed before the Sharia District Court as a "Complaint" for
judicial partition of properties, it is a petition for the
issuance of letters of administration, settlement, and
distribution of the estate of the decedent. It contains
sufficient jurisdictional facts required for the settlement of
the estate of a deceased Muslim,23 such as the fact of
Alejandro Montaer, Sr.s death as well as the allegation
that he is a Muslim. The said petition also contains an
enumeration of the names of his legal heirs, so far as
known to the private respondents, and a probable list of
the properties left by the decedent, which are the very
properties sought to be settled before a probate court.
Furthermore, the reliefs prayed for reveal that it is the
intention of the private respondents to seek judicial
Page 7
settlement of the estate of the decedent.24 These include
the following: (1) the prayer for the partition of the estate
of the decedent; and (2) the prayer for the appointment of
an administrator of the said estate.
We cannot agree with the contention of the petitioners
that the district court does not have jurisdiction over the
case because of an allegation in their answer with a motion
to dismiss that Montaer, Sr. is not a Muslim. Jurisdiction
of a court over the nature of the action and its subject
matter does not depend upon the defenses set forth in an
answer25 or a motion to dismiss.26 Otherwise, jurisdiction
would depend almost entirely on the defendant27 or result
in having "a case either thrown out of court or its
proceedings unduly delayed by simple
stratagem.28 Indeed, the "defense of lack of jurisdiction
which is dependent on a question of fact does not render
the court to lose or be deprived of its jurisdiction."29
The same rationale applies to an answer with a motion to
dismiss.30 In the case at bar, the Sharia District Court is not
deprived of jurisdiction simply because petitioners raised
as a defense the allegation that the deceased is not a
Muslim. The Sharia District Court has the authority to hear
and receive evidence to determine whether it has
jurisdiction, which requires an a priori determination that
the deceased is a Muslim. If after hearing, the Sharia
District Court determines that the deceased was not in fact
a Muslim, the district court should dismiss the case for lack
of jurisdiction.
Special Proceedings
The underlying assumption in petitioners second
argument, that the proceeding before the Sharia District
Court is an ordinary civil action against a deceased person,
rests on an erroneous understanding of the proceeding
before the court a quo. Part of the confusion may be
attributed to the proceeding before the Sharia District
Court, where the parties were designated either as
plaintiffs or defendants and the case was denominated as a
special civil action. We reiterate that the proceedings
before the court a quo are for the issuance of letters of
administration, settlement, and distribution of the estate of
the deceased, which is a special proceeding. Section 3(c) of
the Rules of Court (Rules) defines a special proceeding as
"a remedy by which a party seeks to establish a status, a
right, or a particular fact." This Court has applied the Rules,
particularly the rules on special proceedings, for the
settlement of the estate of a deceased Muslim.31 In a
petition for the issuance of letters of administration,
settlement, and distribution of estate, the applicants seek
to establish the fact of death of the decedent and later to be
duly recognized as among the decedents heirs, which
would allow them to exercise their right to participate in
the settlement and liquidation of the estate of the
decedent.32 Here, the respondents seek to establish the fact
of Alejandro Montaer, Sr.s death and, subsequently, for
private respondent Almahleen Liling S. Montaer to be
recognized as among his heirs, if such is the case in fact.
Petitioners argument, that the prohibition against a
decedent or his estate from being a party defendant in a
civil action33 applies to a special proceeding such as the
settlement of the estate of the deceased, is misplaced.
Unlike a civil action which has definite adverse parties, a
special proceeding has no definite adverse party. The
definitions of a civil action and a special proceeding,
respectively, in the Rules illustrate this difference. A civil
action, in which "a party sues another for the enforcement
or protection of a right, or the prevention or redress of a
Rule 72: Subject Matter and Applicability of General Rules
wrong"34 necessarily has definite adverse parties, who are
either the plaintiff or defendant.35 On the other hand, a
special proceeding, "by which a party seeks to establish a
status, right, or a particular fact,"36 has one definite party,
who petitions or applies for a declaration of a status, right,
or particular fact, but no definite adverse party. In the case
at bar, it bears emphasis that the estate of the decedent is
not being sued for any cause of action. As a special
proceeding, the purpose of the settlement of the estate of
the decedent is to determine all the assets of the
estate,37 pay its liabilities,38 and to distribute the residual
to those entitled to the same.39
Docket Fees
Petitioners third argument, that jurisdiction was not
validly acquired for non-payment of docket fees, is
untenable. Petitioners point to private respondents
petition in the proceeding before the court a quo, which
contains an allegation estimating the decedents estate as
the basis for the conclusion that what private respondents
paid as docket fees was insufficient. Petitioners argument
essentially involves two aspects: (1) whether the clerk of
court correctly assessed the docket fees; and (2) whether
private respondents paid the correct assessment of the
docket fees.
Filing the appropriate initiatory pleading and the payment
of the prescribed docket fees vest a trial court with
jurisdiction over the subject matter.40 If the party filing the
case paid less than the correct amount for the docket fees
because that was the amount assessed by the clerk of
court, the responsibility of making a deficiency assessment
lies with the same clerk of court.41 In such a case, the lower
court concerned will not automatically lose jurisdiction,
because of a partys reliance on the clerk of courts
insufficient assessment of the docket fees.42As "every
citizen has the right to assume and trust that a public
officer charged by law with certain duties knows his duties
and performs them in accordance with law," the party
filing the case cannot be penalized with the clerk of courts
insufficient assessment.43 However, the party concerned
will be required to pay the deficiency.44
In the case at bar, petitioners did not present the clerk of
courts assessment of the docket fees. Moreover, the
records do not include this assessment. There can be no
determination of whether private respondents correctly
paid the docket fees without the clerk of courts
assessment.
Exception to Notice of Hearing
Petitioners fourth argument, that private respondents
motion for reconsideration before the Sharia District
Court is defective for lack of a notice of hearing, must fail
as the unique circumstances in the present case constitute
an exception to this requirement. The Rules require every
written motion to be set for hearing by the applicant and
to address the notice of hearing to all parties
concerned.45 The Rules also provide that "no written
motion set for hearing shall be acted upon by the court
without proof of service thereof."46 However, the Rules
allow a liberal construction of its provisions "in order to
promote [the] objective of securing a just, speedy, and
inexpensive disposition of every action and
proceeding."47 Moreover, this Court has upheld a liberal
construction specifically of the rules of notice of hearing in
cases where "a rigid application will result in a manifest
failure or miscarriage of justice especially if a party
successfully shows that the alleged defect in the
Page 8
questioned final and executory judgment is not apparent
on its face or from the recitals contained therein." 48 In
these exceptional cases, the Court considers that "no party
can even claim a vested right in technicalities," and for this
reason, cases should, as much as possible, be decided on
the merits rather than on technicalities.49
The case at bar falls under this exception. To deny the
Sharia District Court of an opportunity to determine
whether it has jurisdiction over a petition for the
settlement of the estate of a decedent alleged to be a
Muslim would also deny its inherent power as a court to
control its process to ensure conformity with the law and
justice. To sanction such a situation simply because of a
lapse in fulfilling the notice requirement will result in a
miscarriage of justice.
In addition, the present case calls for a liberal construction
of the rules on notice of hearing, because the rights of the
petitioners were not affected. This Court has held that an
exception to the rules on notice of hearing is where it
appears that the rights of the adverse party were not
affected.50 The purpose for the notice of hearing coincides
with procedural due process,51 for the court to determine
whether the adverse party agrees or objects to the motion,
as the Rules do not fix any period within which to file a
reply or opposition.52 In probate proceedings, "what the
law prohibits is not the absence of previous notice, but the
absolute absence thereof and lack of opportunity to be
heard."53 In the case at bar, as evident from the Sharia
District Courts order dated January 17, 2006, petitioners
counsel received a copy of the motion for reconsideration
in question. Petitioners were certainly not denied an
opportunity to study the arguments in the said motion as
they filed an opposition to the same. Since the Sharia
District Court reset the hearing for the motion for
reconsideration in the same order, petitioners were not
denied the opportunity to object to the said motion in a
hearing. Taken together, these circumstances show that
the purpose for the rules of notice of hearing, procedural
process, was duly observed.
Prescription and Filiation
Petitioners fifth argument is premature. Again, the Sharia
District Court has not yet determined whether it has
jurisdiction to settle the estate of the decedent. In the
event that a special proceeding for the settlement of the
estate of a decedent is pending, questions regarding
heirship, including prescription in relation to recognition
and filiation, should be raised and settled in the said
proceeding.54 The court, in its capacity as a probate court,
has jurisdiction to declare who are the heirs of the
decedent.55 In the case at bar, the determination of the
heirs of the decedent depends on an affirmative answer to
the question of whether the Sharia District Court has
jurisdiction over the estate of the decedent.
IN VIEW WHEREOF, the petition is DENIED. The Orders of
the Sharia District Court, dated August 22, 2006 and
September 21, 2006 respectively, are AFFIRMED. Cost
against petitioners.
SO ORDERED.
G.R. No. 133000 October 2, 2001
PATRICIA NATCHER, petitioner,
vs.
HON. COURT OFAPPEALS AND THE HEIR OF GRACIANO
DEL ROSARIO LETICIA DEL ROSARIO, EMILIA DEL
RESORIO MANANGAN, ROSALINDA FUENTES LLANA,
Rule 72: Subject Matter and Applicability of General Rules
RODOLFO FUENTES, ALBERTO FUENTES, EVELYN DEL
ROSARIO, and EDUARDO DEL ROSARIO, respondent..
BUENA, J.:
May a Regional Trial Court, acting as a court of general
jurisdiction in an action for reconveyance annulment of
title with damages, adjudicate matters relating to the
settlement of the estate of a deceased person particularly
on questions as to advancement of property made by the
decedent to any of the heirs?
Sought to be reversed in this petition for review
on certiorari under Rule 45 is the decision1 of public
respondent Court of Appeals, the decretal portion of which
declares:
"Wherefore in view of the foregoing considerations,
judgment appealed from is reversed and set aside and
another one entered annulling the Deed of Sale executed
by Graciano Del Rosario in favor of defendant-appellee
Patricia Natcher, and ordering the Register of Deeds to
Cancel TCT No. 186059 and reinstate TCT No. 107443
without prejudice to the filing of a special proceeding for
the settlement of the estate of Graciano Del Rosario in a
proper court. No costs.
"So ordered."
Spouses Graciano del Rosario and Graciana Esguerra were
registered owners of a parcel of land with an area of 9,322
square meters located in Manila and covered by Transfer
Certificate of Title No. 11889. Upon the death of Graciana
in 1951, Graciano, together with his six children, namely:
Bayani, Ricardo, Rafael, Leticia, Emiliana and Nieves,
entered into an extrajudicial settlement of Graciana's
estate on 09 February 1954 adjudicating and dividing
among themselves the real property subject of TCT No.
11889. Under the agreement, Graciano received 8/14
share while each of the six children received 1/14 share of
the said property. Accordingly, TCT No. 11889 was
cancelled, and in lieu thereof, TCT No. 35980 was issued in
the name of Graciano and the Six children.1wphi1.nt
Further, on 09 February 1954, said heirs executed and
forged an "Agreement of Consolidation-Subdivision of Real
Property with Waiver of Rights" where they subdivided
among themselves the parcel of land covered by TCT No.
35980 into several lots. Graciano then donated to his
children, share and share alike, a portion of his interest in
the land amounting to 4,849.38 square meters leaving only
447.60 square meters registered under Graciano's name,
as covered by TCT No. 35988. Subsequently, the land
subject of TCT No. 35988 was further subdivided into two
separate lots where the first lot with a land area of 80.90
square meter was registered under TCT No. 107442 and
the second lot with a land area of 396.70 square meters
was registered under TCT No. 107443. Eventually,
Graciano sold the first lot2 to a third person but retained
ownership over the second lot.3
On 20 March 1980, Graciano married herein petitioner
Patricia Natcher. During their marriage, Graciano sold the
land covered by TCT No. 107443 to his wife Patricia as a
result of which TCT No. 1860594 was issued in the latter's
name. On 07 October 1985,Graciano died leaving his
second wife Patricia and his six children by his first
marriage, as heirs.
In a complaint5 filed in Civil Case No. 71075 before the
Regional Trial Court of Manila, Branch 55, herein private
respondents alleged that upon Graciano's death, petitioner
Page 9
Natcher, through the employment of fraud,
misrepresentation and forgery, acquired TCT No. 107443,
by making it appear that Graciano executed a Deed of Sale
dated 25 June 19876 in favor herein petitioner resulting in
the cancellation of TCT No. 107443 and the issuance of
TCT no. 186059 in the name of Patricia Natcher. Similarly,
herein private respondents alleged in said complaint that
as a consequence of such fraudulent sale, their legitimes
have been impaired.
In her answer7 dated 19 August 1994, herein petitioner
Natcher averred that she was legally married to Graciano
in 20 March 1980 and thus, under the law, she was
likewise considered a compulsory heir of the latter.
Petitioner further alleged that during Graciano's lifetime,
Graciano already distributed, in advance, properties to his
children, hence, herein private respondents may not
anymore claim against Graciano's estate or against herein
petitioner's property.
After trial, the Regional Trial Court of Manila, Branch 55,
rendered a decision dated 26 January 1996 holding:8
"1) The deed of sale executed by the late Graciano del
Rosario in favor of Patricia Natcher is prohibited by law
and thus a complete nullity. There being no evidence that a
separation of property was agreed upon in the marriage
settlements or that there has been decreed a judicial
separation of property between them, the spouses are
prohibited from entering (into) a contract of sale;
"2) The deed as sale cannot be likewise regarded as a valid
donation as it was equally prohibited by law under Article
133 of the New Civil Code;
"3) Although the deed of sale cannot be regarded as such
or as a donation, it may however be regarded as an
extension of advance inheritance of Patricia Natcher being
a compulsory heir of the deceased."
On appeal, the Court of Appeals reversed and set aside the
lower court's decision ratiocinating, inter alia:
"It is the probate court that has exclusive jurisdiction to
make a just and legal distribution of the estate. The court a
quo, trying an ordinary action for reconveyance /
annulment of title, went beyond its jurisdiction when it
performed the acts proper only in a special proceeding for
the settlement of estate of a deceased person. XXX
"X X X Thus the court a quo erred in regarding the subject
property as advance inheritance. What the court should
have done was merely to rule on the validity of (the) sale
and leave the issue on advancement to be resolved in a
separate proceeding instituted for that purpose. XXX"
Aggrieved, herein petitioner seeks refuge under our
protective mantle through the expediency of Rule 45 of the
Rules of Court and assails the appellate court's decision
"for being contrary to law and the facts of the case."
We concur with the Court of Appeals and find no merit in
the instant petition.
Section 3, Rule 1 of the 1997 Rules of Civil Procedure
defines civil action and special proceedings, in this wise:
"XXX a) A civil action is one by which a party sues another
for the enforcement or protection of a right, or the
prevention or redress of a wrong.
Rule 72: Subject Matter and Applicability of General Rules
"A civil action may either be ordinary or special. Both are
government by the rules for ordinary civil actions, subject
to specific rules prescribed for a special civil action.
"XXX
"c) A special proceeding is a remedy by which a party
seeks to establish a status, a right or a particular fact."
As could be gleaned from the foregoing, there lies a
marked distinction between an action and a special
proceeding. An action is a formal demand of one's right in
a court of justice in the manner prescribed by the court or
by the law. It is the method of applying legal remedies
according to definite established rules. The term "special
proceeding" may be defined as an application or
proceeding to establish the status or right of a party, or a
particular fact. Usually, in special proceedings, no formal
pleadings are required unless the statute expressly so
provides. In special proceedings, the remedy is granted
generally upon an application or motion."9
Citing American Jurisprudence, a noted authority in
Remedial Law expounds further:
"It may accordingly be stated generally that actions include
those proceedings which are instituted and prosecuted
according to the ordinary rules and provisions relating to
actions at law or suits in equity, and that special
proceedings include those proceedings which are not
ordinary in this sense, but is instituted and prosecuted
according to some special mode as in the case of
proceedings commenced without summons and
prosecuted without regular pleadings, which are
characteristics of ordinary actions. XXX A special
proceeding must therefore be in the nature of a distinct
and independent proceeding for particular relief, such as
may be instituted independently of a pending action, by
petition or motion upon notice."10
Applying these principles, an action for reconveyance and
annulment of title with damages is a civil action, whereas
matters relating to settlement of the estate of a deceased
person such as advancement of property made by the
decedent, partake of the nature of a special proceeding,
which concomitantly requires the application of specific
rules as provided for in the Rules of Court.
Clearly, matters which involve settlement and distribution
of the estate of the decedent fall within the exclusive
province of the probate court in the exercise of its limited
jurisdiction.
Thus, under Section 2, Rule 90 of the Rules of Court,
questions as to advancement made or alleged to have been
made by the deceased to any heir may be heard and
determined by the court having jurisdiction of the
estate proceedings; and the final order of the court
thereon shall be binding on the person raising the
questions and on the heir.
While it may be true that the Rules used the word "may", it
is nevertheless clear that the same
provision11contemplates a probate court when it speaks of
the "court having jurisdiction of the estate proceedings".
Corollarily, the Regional Trial Court in the instant case,
acting in its general jurisdiction, is devoid of authority to
render an adjudication and resolve the issue of
advancement of the real property in favor of herein
petitioner Natcher, inasmuch as Civil Case No. 471075 for
reconveyance and annulment of title with damages is not,
Page 10
to our mind, the proper vehicle to thresh out said question.
Moreover, under the present circumstances, the RTC of
Manila, Branch 55 was not properly constituted as a
probate court so as to validly pass upon the question of
advancement made by the decedent Graciano Del Rosario
to his wife, herein petitioner Natcher.
At this point, the appellate court's disquisition is
elucidating:
"Before a court can make a partition and distribution of the
estate of a deceased, it must first settle the estate in a
special proceeding instituted for the purpose. In the case at
hand, the court a quo determined the respective legitimes
of the plaintiffs-appellants and assigned the subject
property owned by the estate of the deceased to
defendant-appellee without observing the proper
proceedings provided (for) by the Rules of Court. From the
aforecited discussions, it is clear that trial courts trying an
ordinary action cannot resolve to perform acts pertaining
to a special proceeding because it is subject to specific
prescribed rules. Thus, the court a quo erred in regarding
the subject property as an advance inheritance."12
In resolving the case at bench, this Court is not unaware of
our pronouncement in Coca vs. Borromeo13 and Mendoza
vs. Teh14 that whether a particular matter should be
resolved by the Regional Trial Court (then Court of First
Instance) in the exercise of its general jurisdiction or its
limited probate jurisdiction is not a jurisdictional issue but
a mere question of procedure. In essence, it is procedural
question involving a mode of practice "which may be
waived".15
Notwithstanding, we do not see any waiver on the part of
herein private respondents inasmuch as the six children of
the decedent even assailed the authority of the trail court,
acting in its general jurisdiction, to rule on this specific
issue of advancement made by the decedent to petitioner.
Analogously, in a train of decisions, this Court has
consistently enunciated the long standing principle that
although generally, a probate court may not decide a
question of title or ownership, yet if the interested parties
are all heirs, or the question is one of collation or
advancement, or the parties consent to the assumption of
jurisdiction by the probate court and the rights of third
parties are not impaired, then the probate court is
competent to decide the question of ownership.16
Similarly in Mendoza vs. Teh, we had occasion to hold:
"In the present suit, no settlement of estate is involved, but
merely an allegation seeking appointment as estate
administratrix which does not necessarily involve
settlement of estate that would have invited the
exercise of the limited jurisdiction of a probate
court.17 (emphasis supplied)
Of equal importance is that before any conclusion about
the legal share due to a compulsory heir may be reached, it
is necessary that certain steps be taken first.18 The net
estate of the decedent must be ascertained, by deducting
all payable obligations and charges from the value of the
property owned by the deceased at the time of his death;
then, all donations subject to collation would be added to
it. With the partible estate thus determined, the legitime of
the compulsory heir or heirs can be established; and only
thereafter can it be ascertained whether or not a donation
had prejudiced the legitimes.19
Rule 72: Subject Matter and Applicability of General Rules
A perusal of the records, specifically the antecedents and
proceedings in the present case, reveals that the trial court
failed to observe established rules of procedure governing
the settlement of the estate of Graciano Del Rosario. This
Court sees no cogent reason to sanction the non-
observance of these well-entrenched rules and hereby
holds that under the prevailing circumstances, a probate
court, in the exercise of its limited jurisdiction, is indeed
the best forum to ventilate and adjudge the issue of
advancement as well as other related matters involving the
settlement of Graciano Del Rosario's estate.1wphi1.nt
WHEREFORE, premises considered, the assailed decision
of the Court of Appeals is hereby AFFIRMED and the
instant petition is DISMISSED for lack of merit.
SO ORDERED.
G.R. No. 109373 March 20, 1995
PACIFIC BANKING CORPORATION EMPLOYEES
ORGANIZATION, PAULA S. PAUG, and its officers and
members, petitioners,
vs.
THE HONORABLE COURT OF APPEALS and VITALIANO
N. NAAGAS II, as Liquidator of Pacific Banking
Corporation, respondents.
G.R. No. 112991 March 20, 1995
THE PRESIDENT OF THE PHILIPPINE DEPOSIT
INSURANCE CORPORATION, as Liquidator of the Pacific
Banking Corporation , petitioner,
vs.
COURT OF APPEALS, HON. JUDGE REGINO T.
VERIDIANO II, DEPUTY SHERIFF RAMON ENRIQUEZ
and ANG ENG JOO, ANG KEONG LAN and E.J ANG INT'L.
LTD., represented by their Attorney-in-fact, GONZALO
C. SY, respondents.
MENDOZA, J.:
These cases have been consolidated because the principal
question involved is the same: whether a petition for
liquidation under 29 of Rep. Act No. 265, otherwise
known as the Central Bank Act, is a special proceeding or
an ordinary civil action. The Fifth and the Fourteenth
Divisions of the Court of Appeals reached opposite results
on this question and consequently applied different
periods for appealing.
The facts are as follows:
I.
Proceedings in the CB and the RTC
On July 5, 1985, the Pacific Banking Corporation (PaBC)
was placed under receivership by the Central Bank of the
Philippines pursuant to Resolution No. 699 of its Monetary
Board. A few months later, it was placed under
liquidation 1 and a Liquidator was appointed. 2
On April 7, 1986, the Central Bank filed with the Regional
Trial Court of Manila Branch 31, a petition entitled
"Petition for Assistance in the Liquidation of Pacific
Banking Corporation." 3 The petition was approved, after
which creditors filed their claims with the court.
Page 11
On May 17, 1991, a new Liquidator, Vitaliano N.
Naagas, 4 President of the Philippine Deposit Insurance
Corporation (PDIC), was appointed by the Central Bank.
On March 13, 1989 the Pacific Banking Corporation
Employees Organization (Union for short), petitioner in
G.R. No. 109373, filed a complaint-in-intervention seeking
payment of holiday pay, 13th month pay differential,
salary increase differential, Christmas bonus, and cash
equivalent of Sick Leave Benefit due its members as
employees of PaBC. In its order dated September 13, 1991,
the trial court ordered payment of the principal claims of
the Union. 5
The Liquidator received a copy of the order on September
16, 1991. On October 16, 1991, he filed a Motion for
Reconsideration and Clarification of the order. In his order
of December 6, 1991, the judge modified his September 13,
1991 6 but in effect denied the Liquidator's motion for
reconsideration. This order was received by the Liquidator
on December 9, 1991. The following day, December 10,
1991, he filed a Notice of Appeal and a Motion for
Additional Time to Submit Record on Appeal. On
December 23, 1991, another Notice of Appeal was filed by
the Office of the Solicitor General in behalf of Naagas.
In his order of February 10, 1992, respondent judge
disallowed the Liquidator's Notice of Appeal on the ground
that it was late, i.e., more than 15 days after receipt of the
decision. The judge declared his September 13, 1991 order
and subsequent orders to be final and executory and
denied reconsideration. On March 27, 1992, he granted the
Union's Motion for issuance of a writ of Execution.
Ang Keong Lan and E.J. Ang Int'l., private respondents in
G.R. No. 112991, likewise filed claims for the payment of
investment in the PaBC allegedly in the form of shares of
stocks amounting to US$2,531,632.18. The shares of
stocks, consisting of 154,462 common shares, constituted
11% of the total subscribed capital stock of the PaBC. They
alleged that their claim constituted foreign exchange
capital investment entitled to preference in payment
under the Foreign Investments Law.
In his order dated September 11, 1992, respondent judge
of the RTC directed the Liquidator to pay private
respondents the total amount of their claim as preferred
creditors. 7
The Liquidator received the order on September 16, 1992.
On September 30, 1992 he moved for reconsideration, but
his motion was denied by the court on October 2, 1992. He
received the order denying his Motion for Reconsideration
on October 5, 1992. On October 14, 1992 he filed a Notice
of Appeal from the orders of September 16, 1992 and
October 2, 1992. As in the case of the Union, however, the
judge ordered the Notice of Appeal stricken off the record
on the ground that it had been filed without authority of
the Central Bank and beyond 15 days. In his order of
October 28, 1992, the judge directed the execution of his
September 11, 1992 order granting the Stockholders/
Investors' claim.
II.
Proceedings in the Court of Appeals
The Liquidator filed separate Petitions for Certiorari,
Prohibition and Mandamus in the Court of Appeals to set
aside the orders of the trial court denying his appeal from
the orders granting the claims of Union and of the
Stockholders/Investors. The two Divisions of the Court of
Rule 72: Subject Matter and Applicability of General Rules
Appeals, to which the cases were separately raffled,
rendered conflicting rulings.
In its decision of November 17, 1992 in CA-G.R. SP No.
27751 (now G.R. No. 09373) the Fifth Division 8 held in the
case of the Union that the proceeding before the trial court
was a special proceeding and, therefore, the period for
appealing from any decision or final order rendered
therein is 30 days. Since the notice of appeal of the
Liquidator was filed on the 30th day of his receipt of the
decision granting the Union's claims, the appeal was
brought on time. The Fifth Division, therefore, set aside the
orders of the lower court and directed the latter to give
due course to the appeal of the Liquidator and set the
Record on Appeal he had filed for hearing.
On the other hand, on December 16, 1993, the Fourteenth
Division 9 ruled in CA-G.R. SP No. 29351 (now G.R. No.
112991) in the case of the Stockholders/Investors that a
liquidation proceeding is an ordinary action. Therefore,
the period for appealing from any decision or final order
rendered therein is 15 days and that since the Liquidator's
appeal notice was filed on the 23rd day of his receipt of the
order appealed from, deducting the period during which
his motion for reconsideration was pending, the notice of
appeal was filed late. Accordingly, the Fourteenth Division
dismissed the Liquidator's petition.
III.
Present Proceedings
The Union and the Liquidator then separately filed
petitions before this Court.
In G.R. No. 109373 the Union contends that:
1. The Court of Appeals acted without jurisdiction over the
subject matter or nature of the suit.
2. The Court of Appeals gravely erred in taking cognizance
of the petition for certiorari filed by Naagas who was
without any legal authority to file it.
3. The Court of Appeals erred in concluding that the case is
a special proceeding governed by Rules 72 to 109 of the
Revised Rules of Court.
4. The Court of Appeals erred seriously in concluding that
the notice of appeal filed by Naagas was filed on time.
5. The Court of Appeals erred seriously in declaring that
the second notice of appeal filed on December 23, 1991 by
the Solicitor General is a superfluity.
On the other hand, in G.R. No. 112991 the Liquidator
contends that:
1. The Petition for Assistance in the Liquidation of the
Pacific Banking Corporation s a Special Proceeding case
and/or one which allows multiple appeals, in which case
the period of appeal is 30 days and not 15 days from
receipt of the order/judgment appealed from.
2. Private respondents are not creditors of PaBC but are
plain stockholders whose right to receive payment as such
would accrue only after all the creditors of the insolvent
bank have been paid.
3. The claim of private respondents in the amount of
US$22,531,632.18 is not in the nature of foreign
investment as it is understood in law.
Page 12
4. The claim of private respondents has not been clearly
established and proved.
5. The issuance of a writ of execution against the assets of
PaBC was made with grave abuse of discretion.
The petitions in these cases must be dismissed.
First. As stated in the beginning, the principal question in
these cases is whether a petition for liquidation under 29
of Rep. Act No. 265 is in the nature of a special proceeding.
If it is, then the period of appeal is 30 days and the party
appealing must, in addition to a notice of appeal, file with
the trial court a record on appeal in order to perfect his
appeal. Otherwise, if a liquidation proceeding is an
ordinary action, the period of appeal is 15 days from notice
of the decision or final order appealed from.
BP Blg. 129 provides:
39. Appeals. The period for appeal from final orders,
resolutions, awards, judgments, or decisions of any court
in all cases shall be fifteen (15) days counted from the
notice of the final order, resolution, award, judgment or
decision appealed from: Provided, however, that in habeas
corpuscases the period for appeal shall be forty-eight (48)
hours from the notice of the judgment appealed from.
No record on appeal shall be required to take an appeal. In
lieu thereof, the entire record shall be transmitted with all
the pages prominently numbered consecutively, together
with an index of the contents thereof.
This section shall not apply in appeals in special
proceedings and in other cases wherein multiple appeals
are allowed under applicable provisions of the Rules of
Court.
The Interim Rules and Guidelines to implement BP Blg.
129 provides:
19. Period of Appeals.
(a) All appeals, except in habeas corpus cases and in the
cases referred to in paragraph (b) hereof, must be taken
within fifteen (15) days from notice of the judgment, order,
resolution or award appealed from.
(b) In appeals in special proceedings in accordance with
Rule 109 of the Rules of Court and other cases wherein
multiple appeals are allowed, the period of appeals shall be
thirty (30) days, a record on appeal being required.
The Fourteenth Division of the Court of Appeals held that
the proceeding is an ordinary action similar to an action
for interpleader under Rule 63. 10 The Fourteenth Division
stated:
The petition filed is akin to an interpleader under Rule 63
of the Rules of Court where there are conflicting claimants
or several claims upon the same subject matter, a person
who claims no interest thereon may file an action for
interpleader to compel the claimants to "interplead" and
litigate their several claims among themselves. (Section I
Rule 63).
An interpleader is in the category of a special civil action
under Rule 62 which, like an ordinary action, may be
appealed only within fifteen (15) days from notice of the
judgment or order appealed from. Under Rule 62, the
preceding rules covering ordinary civil actions which are
not inconsistent with or may serve to supplement the
provisions of the rule relating to such civil actions are
Rule 72: Subject Matter and Applicability of General Rules
applicable to special civil actions. This embraces Rule 41
covering appeals from the regional trial court to the Court
of Appeals.
xxx xxx xxx
Thus, under Section 1 Rule 2 of the Rules of Court, an
action is defined as "an ordinary suit in a court of justice by
which one party prosecutes another for the enforcement
or protection of a right or the prevention or redress of a
wrong." On the other hand, Section 2 of the same Rule
states that "every other remedy including one to establish
the status or right of a party or a particular fact shall be by
special proceeding."
To our mind, from the aforequoted definitions of an action
and a special proceeding, the petition for assistance of the
court in the liquidation of an asset of a bank is not "one to
establish the status or right of a party or a particular fact."
Contrary to the submission of the petitioner, the petition is
not intended to establish the fact of insolvency of the bank.
The insolvency of the bank had already been previously
determined by the Central Bank in accordance with
Section 9 of the CB Act before the petition was filed. All
that needs to be done is to liquidate the assets of the bank
and thus the assistance of the respondent court is sought
for that purpose.
It should be pointed out that this petition filed is not
among the cases categorized as a special proceeding under
Section 1, Rule 72 of the Rules of Court, nor among the
special proceedings that may be appealed under Section 1,
Rule 109 of the Rules.
We disagree with the foregoing view of the Fourteenth
Division. Rule 2 of the Rules of Court provide:
1. Action defined. Action means an ordinary suit in a
court of justice, by which the party prosecutes another for
the enforcement or protection of a right, or the prevention
or redress of a wrong.
2. Special Proceeding Distinguished. Every other
remedy, including one to establish the status or right of a
party or a particular fact, shall be by special proceeding.
Elucidating the crucial distinction between an ordinary
action and a special proceeding, Chief Justice Moran
states:" 11
Action is the act by which one sues another in a court of
justice for the enforcement or protection of a right, or the
prevention or redress of a wrong while special proceeding
is the act by which one seeks to establish the status or
right of a party, or a particular fact. Hence, action is
distinguished from special proceeding in that the former is
a formal demand of a right by one against another, while
the latter is but a petition for a declaration of a status, right
or fact. Where a party litigant seeks to recover property
from another, his remedy is to file an action. Where his
purpose is to seek the appointment of a guardian for an
insane, his remedy is a special proceeding to establish the
fact or status of insanity calling for an appointment of
guardianship.
Considering this distinction, a petition for liquidation of an
insolvent corporation should be classified a special
proceeding and not an ordinary action. Such petition does
not seek the enforcement or protection of a right nor the
prevention or redress of a wrong against a party. It does
not pray for affirmative relief for injury arising from a
Page 13
party's wrongful act or omission nor state a cause of action
that can be enforced against any person.
What it seeks is merely a declaration by the trial court of
the corporation's insolvency so that its creditors may be
able to file their claims in the settlement of the
corporation's debts and obligations. Put in another way,
the petition only seeks a declaration of the corporation's
debts and obligations. Put in another way, the petition only
seeks a declaration of the corporation's state of insolvency
and the concomitant right of creditors and the order of
payment of their claims in the disposition of the
corporation's assets.
Contrary to the rulings of the Fourteenth Division,
liquidation proceedings do not resemble petitions for
interpleader. For one, an action for interpleader involves
claims on a subject matter against a person who has no
interest therein. 12 This is not the case in a liquidation
proceeding where the Liquidator, as representative of the
corporation, takes charge of its assets and liabilities for the
benefit of the creditors. 13 He is thus charged with insuring
that the assets of the corporation are paid only to rightful
claimants and in the order of payment provided by law.
Rather, a liquidation proceeding resembles the proceeding
for the settlement of state of deceased persons under Rules
73 to 91 of the Rules of Court. The two have a common
purpose: the determination of all the assets and the
payment of all the debts and liabilities of the insolvent
corporation or the estate. The Liquidator and the
administrator or executor are both charged with the assets
for the benefit of the claimants. In both instances, the
liability of the corporation and the estate is not disputed.
The court's concern is with the declaration of creditors and
their rights and the determination of their order of
payment.
Furthermore, as in the settlement of estates, multiple
appeals are allowed in proceedings for liquidation of an
insolvent corporation. As the Fifth Division of the Court of
Appeals, quoting the Liquidator, correctly noted:
A liquidation proceeding is a single proceeding which
consists of a number of cases properly classified as
"claims." It is basically a two-phased proceeding. The first
phase is concerned with the approval and disapproval of
claims. Upon the approval of the petition seeking the
assistance of the proper court in the liquidation of a close
entity, all money claims against the bank are required to be
filed with the liquidation court. This phase may end with
the declaration by the liquidation court that the claim is
not proper or without basis. On the other hand, it may also
end with the liquidation court allowing the claim. In the
latter case, the claim shall be classified whether it is
ordinary or preferred, and thereafter included Liquidator.
In either case, the order allowing or disallowing a
particular claim is final order, and may be appealed by the
party aggrieved thereby.
The second phase involves the approval by the Court of the
distribution plan prepared by the duly appointed
liquidator. The distribution plan specifies in detail the total
amount available for distribution to creditors whose claim
were earlier allowed. The Order finally disposes of the
issue of how much property is available for disposal.
Moreover, it ushers in the final phase of the liquidation
proceeding payment of all allowed claims in accordance
with the order of legal priority and the approved
distribution plan.
Rule 72: Subject Matter and Applicability of General Rules
Verily, the import of the final character of an Order of
allowance or disallowance of a particular claim cannot be
overemphasized. It is the operative fact that constitutes a
liquidation proceeding a "case where multiple appeals are
allowed by law." The issuance of an Order which, by its
nature, affects only the particular claims involved, and
which may assume finality if no appeal is made
therefrom, ipso facto creates a situation where multiple
appeals are allowed.
A liquidation proceeding is commenced by the filing of a
single petition by the Solicitor General with a court of
competent jurisdiction entitled, "Petition for Assistance in
the Liquidation of e.g., Pacific Banking Corporation. All
claims against the insolvent are required to be filed with
the liquidation court. Although the claims are litigated in
the same proceeding, the treatment is individual. Each
claim is heard separately. And the Order issued relative to
a particular claim applies only to said claim, leaving the
other claims unaffected, as each claim is considered
separate and distinct from the others. Obviously, in the
event that an appeal from an Order allowing or disallowing
a particular claim is made, only said claim is affected,
leaving the others to proceed with their ordinary course.
In such case, the original records of the proceeding are not
elevated to the appellate court. They remain with the
liquidation court. In lieu of the original record, a record of
appeal is instead required to be prepared and transmitted
to the appellate court.
Inevitably, multiple appeals are allowed in liquidation
proceedings. Consequently, a record on appeal is
necessary in each and every appeal made. Hence, the
period to appeal therefrom should be thirty (30) days, a
record on appeal being required. (Record pp. 162-164).
In G.R. No. 112991 (the case of the
Stockholders/Investors), the Liquidator's notice of appeal
was filed on time, having been filed on the 23rd day of
receipt of the order granting the claims of the
Stockholders/Investors. However, the Liquidator did not
file a record on appeal with the result that he failed to
perfect his appeal. As already stated a record on appeal is
required under the Interim Rules and Guidelines in special
proceedings and for cases where multiple appeals are
allowed. The reason for this is that the several claims are
actually separate ones and a decision or final order with
respect to any claim can be appealed. Necessarily the
original record on appeal must remain in the trial court
where other claims may still be pending.
Because of the Liquidator's failure to perfect his appeal,
the order granting the claims of the
Stockholders/Investors became final. Consequently. the
Fourteenth Division's decision dismissing the Liquidator's
Petition for Certiorari, Prohibition and Mandamus must be
affirmed albeit for a different reason.
On the other hand, in G.R. No. 109373 (case of the Labor
Union), we find that the Fifth Division correctly granted
the Liquidator's Petition for Certiorari. Prohibition
and Mandamus. As already noted, the Liquidator filed a
notice of appeal and a motion for extension to file a record
on appeal on December 10, 1991, i.e., within 30 days of his
receipt of the order granting the Union's claim. Without
waiting for the resolution of his motion for extension, he
filed on December 20, 1991 within the extension sought a
record on appeal. Respondent judge thus erred in
disallowing the notice on appeal and denying the
Liquidator's motion for extension to file a record on
appeal.
Page 14
The Fifth Division of the Court of Appeals correctly granted
the Liquidator's Petition for Certiorari, Prohibition
and Mandamus and its decision should, therefore, be
affirmed.
Second. In G.R. No. 109373, The Union claims that under
29 of Rep. Act No. 265, the court merely assists in
adjudicating the claims of creditors, preserves the assets of
the institution, and implements the liquidation plan
approved by the Monetary Board and that, therefore, as
representative of the Monetary Board, the Liquidator
cannot question the order of the court or appeal from it. It
contends that since the Monetary Board had previously
admitted PaBC's liability to the laborers by in fact setting
aside the amount of P112,234,292.44 for the payment of
their claims, there was nothing else for the Liquidator to
do except to comply with the order of the court.
The Union's contention is untenable. In liquidation
proceedings, the function of the trial court is not limited to
assisting in the implementation of the orders of the
Monetary Board. Under the same section (29) of the law
invoked by the Union, the court has authority to set aside
the decision of the Monetary Board "if there is a convincing
proof that the action is plainly arbitrary and made in bad
faith." 14 As this Court held in Rural Bank of Buhi,
Inc. v. Court of Appeals: 15
There is no question, that the action of the monetary Board
in this regard may be subject to judicial review. Thus, it has
been held that the Court's may interfere with the Central
Bank's exercise of discretion in determining whether or
not a distressed bank shall be supported or liquidated.
Discretion has its limits and has never been held to include
arbitrariness, discrimination or bad faith (Ramos v. Central
Bank of the Philippines, 41 SCRA 567 [1971]).
In truth, the Liquidator is the representative not only of
the Central Bank but also of the insolvent bank. Under
28A-29 of Rep. Act No. 265 he acts in behalf of the bank
"personally or through counsel as he may retain, in all
actions or proceedings or against the corporation" and he
has authority "to do whatever may be necessary for these
purposes." This authority includes the power to appeal
from the decisions or final orders of the court which he
believes to be contrary to the interest of the bank.
Finally the Union contends that the notice of appeal and
motion for extension of time to file the record on appeal
filed in behalf of the Central Bank was not filed by the
office of the Solicitor General as counsel for the Central
Bank. This contention has no merit. On October 22, 1992,
as Assistant Solicitor General Cecilio O. Estoesta informed
the trial court in March 27, 1992, the OSG had previously
authorized lawyers of the PDIC to prepare and sign
pleadings in the case. 16 Conformably thereto the Notice of
Appeal and the Motion for Additional Time to submit
Record on Appeal filed were jointly signed by Solicitor
Reynaldo I. Saludares in behalf of the OSG and by lawyers
of the PDIC. 17
WHEREFORE, in G.R. No. 109373 and G.R. No 112991, the
decisions appealed from are AFFIRMED.
SO ORDERED.
G.R. No. 163604 May 6, 2005
REPUBLIC OF THE PHILIPPINES, petitioner,
vs.
THE HON. COURT OF APPEALS (Twentieth Division),
HON. PRESIDING JUDGE FORTUNITO L. MADRONA,
Rule 72: Subject Matter and Applicability of General Rules
RTC-BR. 35 and APOLINARIA MALINAO
JOMOC, respondents.
DECISION
CARPIO-MORALES, J.:
In "In the Matter of Declaration of Presumptive Death of
Absentee Spouse Clemente P. Jomoc, Apolinaria Malinao
Jomoc, petitioner," the Ormoc City, Regional Trial Court,
Branch 35, by Order of September 29, 1999,1 granted the
petition on the basis of the Commissioners Report2 and
accordingly declared the absentee spouse, who had left his
petitioner-wife nine years earlier, presumptively dead.
In granting the petition, the trial judge, Judge Fortunito L.
Madrona, cited Article 41, par. 2 of the Family Code. Said
article provides that for the purpose of contracting a valid
subsequent marriage during the subsistence of a previous
marriage where the prior spouse had been absent for four
consecutive years, the spouse present must
institute summary proceedings for the declaration of
presumptive death of the absentee spouse, without
prejudice to the effect of the reappearance of the absent
spouse.
The Republic, through the Office of the Solicitor General,
sought to appeal the trial courts order by filing a Notice of
Appeal.3
By Order of November 22, 1999s,4 the trial court, noting
that no record of appeal was filed and served "as required
by and pursuant to Sec. 2(a), Rule 41 of the 1997 Rules of
Civil Procedure, the present case being a special
proceeding," disapproved the Notice of Appeal.
The Republics Motion for Reconsideration of the trial
courts order of disapproval having been denied by Order
of January 13, 2000,5 it filed a Petition
for Certiorari6 before the Court of Appeals, it contending
that the declaration of presumptive death of a person
under Article 41 of the Family Code is not a special
proceeding or a case of multiple or separate appeals
requiring a record on appeal.
By Decision of May 5, 2004,7 the Court of Appeals denied
the Republics petition on procedural and substantive
grounds in this wise:
At the outset, it must be stressed that the petition is not
sufficient in form. It failed to attach to its petition a
certified true copy of the assailed Order dated January 13,
2000 [denying its Motion for Reconsideration of the
November 22, 1999 Order disapproving its Notice of
Appeal]. Moreover, the petition questioned the [trial
courts] Order dated August 15, 1999, which declared
Clemente Jomoc presumptively dead, likewise for having
been issued with grave abuse of discretion amounting to
lack of jurisdiction, yet, not even a copy could be found in
the records. On this score alone, the petition should have
been dismissed outright in accordance with Sec. 3, Rule 46
of the Rules of Court.
However, despite the procedural lapses, the Court resolves
to delve deeper into the substantive issue of the
validity/nullity of the assailed order.
The principal issue in this case is whether a petition
for declaration of the presumptive death of a person is
in the nature of a special proceeding. If it is, the period
to appeal is 30 days and the party appealing must, in
addition to a notice of appeal, file with the trial court a
Page 15
record on appeal to perfect its appeal. Otherwise, if the
petition is an ordinary action, the period to appeal is 15
days from notice or decision or final order appealed from
and the appeal is perfected by filing a notice of appeal
(Section 3, Rule 41, Rules of Court).
As defined in Section 3(a), Rule 1 of the Rules of Court, "a
civil action is one by which a party sues another for the
enforcement or protection of a right, or the prevention of
redress of a wrong" while a special proceeding under
Section 3(c) of the same rule is defined as "a remedy by
which a party seeks to establish a status, a right or a
particular fact (Heirs of Yaptinchay, et al. v. Del Rosario, et
al., G.R. No. 124320, March 2, 1999).
Considering the aforementioned distinction, this Court
finds that the instant petition is in the nature of a
special proceeding and not an ordinary action. The
petition merely seeks for a declaration by the trial court of
the presumptive death of absentee spouse Clemente
Jomoc. It does not seek the enforcement or protection of a
right or the prevention or redress of a wrong. Neither does
it involve a demand of right or a cause of action that can be
enforced against any person.
On the basis of the foregoing discussion, the subject Order
dated January 13, 2000 denying OSGs Motion for
Reconsideration of the Order dated November 22, 1999
disapproving its Notice of Appeal was correctly
issued. The instant petition, being in the nature of a
special proceeding, OSG should have filed, in addition
to its Notice of Appeal, a record on appeal in accordance
with Section 19 of the Interim Rules and Guidelines to
Implement BP Blg. 129 and Section 2(a), Rule 41 of the
Rules of Court . . . (Emphasis and underscoring supplied)
The Republic (petitioner) insists that the declaration of
presumptive death under Article 41 of the Family Code is
not a special proceeding involving multiple or separate
appeals where a record on appeal shall be filed and served
in like manner.
Petitioner cites Rule 109 of the Revised Rules of Court
which enumerates the cases wherein multiple appeals are
allowed and a record on appeal is required for an appeal to
be perfected. The petition for the declaration of
presumptive death of an absent spouse not being included
in the enumeration, petitioner contends that a mere notice
of appeal suffices.
By Resolution of December 15, 2004,8 this Court, noting
that copy of the September 27, 2004 Resolution9requiring
respondent to file her comment on the petition was
returned unserved with postmasters notation "Party
refused," Resolved to consider that copy deemed served
upon her.
The pertinent provisions on the General Provisions on
Special Proceedings, Part II of the Revised Rules of Court
entitled SPECIAL PROCEEDINGS, read:
RULE 72
SUBJECT MATTER AND APPLICABILITY
OF GENERAL RULES
Section 1. Subject matter of special proceedings. Rules of
special proceedings are provided for in the following:
(a) Settlement of estate of deceased persons;
(b) Escheat;
Rule 72: Subject Matter and Applicability of General Rules
(c) Guardianship and custody of children;
(d) Trustees;
(e) Adoption;
(f) Rescission and revocation of adoption;
(g) Hospitalization of insane persons;
(h) Habeas corpus;
(i) Change of name;
(j) Voluntary dissolution of corporations;
(k) Judicial approval of voluntary recognition of minor
natural children;
(l) Constitution of family home;
(m) Declaration of absence and death;
(n) Cancellation or correction of entries in the civil
registry.
Sec. 2. Applicability of rules of civil actions. In the absence
of special provisions, the rules provided for in ordinary
actions shall be, as far as practicable, applicable in special
proceedings. (Underscoring supplied)
The pertinent provision of the Civil Code on presumption
of death provides:
Art. 390. After an absence of seven years, it being unknown
whether or not the absentee still lives, he shall
be presumed dead for all purposes, except for those of
succession.
x x x (Emphasis and underscoring supplied)
Upon the other hand, Article 41 of the Family Code, upon
which the trial court anchored its grant of the petition for
the declaration of presumptive death of the absent spouse,
provides:
Art. 41. A marriage contracted by any person during the
subsistence of a previous marriage shall be null and void,
unless before the celebration of the subsequent marriage,
the prior spouses had been absent for four consecutive
years and the spouse present had a well-founded belief
that the absent spouses was already dead. In case of
disappearance where there is danger of death under the
circumstances set forth in the provisions of Article 391 of
the Civil Code, an absence of only two years shall be
sufficient.
For the purpose pf contracting the subsequent marriage
under the preceding paragraph, the spouses present must
institute a summary proceeding as provided in this
Code for the declaration of presumptive death of the
absentee, without prejudice to the effect of a reappearance
of the absent spouse. (Emphasis and underscoring
supplied)
Rule 41, Section 2 of the Revised Rules of Court, on Modes
of Appeal, invoked by the trial court in disapproving
petitioners Notice of Appeal, provides:
Sec. 2. Modes of appeal. -
(a) Ordinary appeal. - The appeal to the Court of Appeals in
cases decided by the Regional Trial Court in the exercise of
its original jurisdiction shall be taken by filing a notice of
Page 16
appeal with the court which rendered the judgment or
final order appealed from and serving a copy thereof upon
the adverse party. No record on appeal shall be required
except in special proceedings and other cases of
multiple or separate appeals where the law or these
Rules so require. In such cases, the record on appeal shall
be filed and served in like manner. (Emphasis and
underscoring supplied)
xxx
By the trial courts citation of Article 41 of the Family Code,
it is gathered that the petition of Apolinaria Jomoc to have
her absent spouse declared presumptively dead had for its
purpose her desire to contract a valid subsequent
marriage. Ergo, the petition for that purpose is a
"summary proceeding," following above-quoted Art. 41,
paragraph 2 of the Family Code.
Since Title XI of the Family Code, entitled SUMMARY
JUDICIAL PROCEEDING IN THE FAMILY LAW, contains the
following provision, inter alia:
xxx
Art. 238. Unless modified by the Supreme Court, the
procedural rules in this Title shall apply in all
casesprovided for in this Codes requiring summary court
proceedings. Such cases shall be decided in an
expeditious manner without regard to technical
rules. (Emphasis and underscoring supplied)
x x x,
there is no doubt that the petition of Apolinaria Jomoc
required, and is, therefore, a summary proceeding under
the Family Code, not a special proceeding under the
Revised Rules of Court appeal for which calls for the filing
of a Record on Appeal. It being a summary ordinary
proceeding, the filing of a Notice of Appeal from the trial
courts order sufficed.
That the Family Code provision on repeal, Art. 254,
provides as follows:
Art. 254. Titles III, IV, V, VI, VII, VIII, IX, XI and XV of Book I
of Republic Act No. 386, otherwise known as the Civil Code
of the Philippines, as amended, and Articles 17, 18, 19, 27,
28, 29, 30, 31, 39, 40, 41 and 42 of Presidential Decree No.
603, otherwise known as the Child and Youth Welfare
Code, as amended, and all laws, decrees, executive orders,
proclamations rules and regulations, or parts
thereof, inconsistent therewith are
hereby repealed, (Emphasis and underscoring supplied),
seals the case in petitioners favor.
Finally, on the alleged procedural flaw in petitioners
petition before the appellate court. Petitioners failure to
attach to his petition before the appellate court a copy of
the trial courts order denying its motion for
reconsideration of the disapproval of its Notice of Appeal
is not necessarily fatal, for the rules of procedure are not to
be applied in a technical sense. Given the issue raised
before it by petitioner, what the appellate court should
have done was to direct petitioner to comply with the rule.
As for petitioners failure to submit copy of the trial courts
order granting the petition for declaration of presumptive
death, contrary to the appellate courts observation that
petitioner was also assailing it, petitioners 8-page
petition10 filed in said court does not so reflect, it merely
Rule 72: Subject Matter and Applicability of General Rules
having assailed the order disapproving the Notice of
Appeal.
WHEREFORE, the assailed May 5, 2004 Decision of the
Court of Appeals is hereby REVERSED and SET ASIDE. Let
the case be REMANDED to it for appropriate action in light
of the foregoing discussion.
SO ORDERED.
G.R. No. 141396 April 9, 2002
DEOGRACIAS MUSA, ROMEO and ANDRO MUSA, as
represented by their Attorney-in-fact, MARILYN
MUSA, petitioners,
vs.
SYLVIA AMOR, respondent.
KAPUNAN, J.:
Assailed in this petition for review on certiorari is the
Decision of the Court of Appeals dated September 27, 1999
in C.A. G.R. S.P. No. 49263 which modified in part the
decision of the Department of Agrarian Reform
Adjudication Board (DARAB) and ruled that herein
petitioners Deogracias, Romeo and Andro Musa are not
tenants of the subject landholding; as well as the
Resolution dated December 29, 1999 denying petitioners
motion for reconsideration.
This case involves an agricultural landholding with a total
area of 9.9611 hectares located at Dancalan, Donsol,
Sorsogon formerly owned by one Antonio Dasig, two
hectares of which are ricelands and the rest are devoted to
coconuts. When Antonio Dasig migrated to the United
States, his mother, Rosario Dasig, acted as administratrix
of the said property.
On March 5, 1993, Rosario, representing her son, sold the
subject property to herein respondent Sylvia Amor for the
total amount of P300,000.00. This prompted petitioners,
claiming to be tenants of the landholding, to file a case for
redemption against respondent and Rosario Dasig with the
Department of Agrarian Reform Regional Adjudicator.
Later on, respondent tried to eject petitioners from the
property so the latter withdrew the case for redemption
and filed against respondent a complaint for annulment of
sale, reinstatement and damages with a prayer for
preliminary injunction, docketed as DARAB Case No. 05-
154-S.
In their complaint, petitioners averred that in 1979,
Deogracias Musa entered into a verbal tenurial
arrangement with Antonio Dasig, through Rosario Dasig.
Deogracias tenancy continued uninterrupted under a 2/3-
1/3 sharing arrangement per harvest on the riceland
portion and a 60-40 sharing in the produce of the coconut
plantation. Deogracias was helped by his two sons, Andro
and Romeo Musa. When Deogracias fell ill due to a stroke
in 1990, his sons took over the cultivation and continued
the previous arrangement with Rosario Dasig who duly
acknowledged the same and received the share pertaining
to her as landowner. Petitioners were thus surprised when
the landholding was later on sold by Rosario Dasig to
respondent without their knowledge and consent. They
tried to redeem the property as tenants but during the
pendency of the case, a notice dated September 8, 1993
was issued by the Department of Agrarian Reform placing
the entire property under the Comprehensive Agrarian
Reform Program (CARP). This prompted petitioners to file
a complaint for annulment of the sale. Finally, petitioners
asseverated that the sale of the land to private respondent
Page 17
was illegal and void since the land was subject to the
Voluntary Offer To Sell scheme of the DAR as evidenced by
the CARP VOS Form No. 1 signed by Antonio Dasig.
Rosario Dasig, though impleaded as a party, did not
participate in the proceedings before the Regional
Adjudicator. Only respondent Amor filed an answer.
Respondent maintained that the sale of the subject
landholding was valid because petitioners were
not bonafide tenants of the same but merely worked
thereon as hired workers on a "pakyaw" basis; that
Deogracias Musa admitted in an affidavit executed on July
4, 1982 that he was a hired worker; that the CARP
Voluntary Offer To Sell allegedly executed by Antonio
Dasig was forged as attested to by the latter in his affidavit
dated November 23, 1993; and that petitioners are not
qualified beneficiaries under P.D. 27 and R.A. 6637
because they are landowners themselves.
On June 30, 1994, the Regional Adjudicator of DAR ruled in
favor of petitioners declaring them as tenants of the
subject landholding and nullifying the deed of absolute
sale between Rosario Dasig and respondent. The
dispositive portion of the said decision reads:
WHEREFORE, judgment is hereby rendered:
1) Declaring complainant as tenants in the subject
landholding;
2) Declaring the Deed of Absolute Sale Null and Void
without prejudice to the filing with another forum of
appropriate jurisdiction for the parties thereto to recover
whatever rights that may pertain to them;
3) Ordering respondent and all persons acting in their
behalf to reinstate complainants in the subject landholding
and to maintain the latter in peaceful possession therein;
4) Directing the PARO of Sorsogon, the Regional Director
DAR Region V to generate transfer action on the portion of
land in question covered by Operation Land Transfer
subject to matter of this case.
5) No pronouncement as to Costs and Damages.
SO ORDERED.1
On appeal, the Department of Agrarian Reform
Adjudication Board (DARAB) modified the ruling of the
Regional Adjudicator by declaring that petitioners
are bonafide tenants of the land in question and are thus
entitled to security of tenure.2 Not satisfied with the ruling
of the DARAB, respondent brought the case on appeal to
the Court of Appeals alleging that DARAB erred in
declaring that petitioners are bonafide tenants of the
subject landholding and in holding that the Secretary of
Agrarian Reform has authority to determine whether the
said land is covered by P.D. No. 27 and RA
6657.1wphi1.nt
In their Comment on the petition, petitioners pointed out
that the petition should not be given due course since (1) it
was not accompanied by a written explanation why the
petition was not served personally to them and (2) the
certification on non-forum shopping was inadequate for
failure to conform with the prescribed contents set forth
under Section 2, Rule 42 of the Revised Rules of Court.
On September 27, 1999, the Court of Appeals rendered a
decision modifying the DARABs ruling only insofar as
petitioners status is concerned and holding that they
Rule 72: Subject Matter and Applicability of General Rules
"should not be considered tenants of the subject
landholding."3 The decision of the DARAB was affirmed in
all other respects.4 As to whether or not the subject
landholding is covered by P.D. 27 and R.A. 6657, the Court
of Appeals sustained the DARABs ruling that the matter
involves an administrative determination within the
exclusive jurisdiction of the Secretary of the Department of
Agrarian Reform. With regard to the procedural error
raised by petitioners, the Court of Appeals held that the
Rules of Court, particularly on modes of service and filing
of pleadings, does not apply to agrarian cases.
Petitioners sought a reconsideration of the above ruling
but the Court of Appeals denied the motion and affirmed
its decision. In rejecting petitioners contention that the
case has been rendered moot and academic by the
declaration of the Department of Agrarian Reform that the
subject landholding is covered by CARP, the Court of
Appeals reasoned that such development has no
significance because petitioners "have already been
declared not to be tenants of the landowner and therefore
not qualified beneficiaries of the provisions of CARP."5
Petitioners thus found their way to this Court through the
present petition praying for the reversal of the Court of
Appeals decision and resolution. They assigned the
following errors:
THE HONORABLE COURT OF APPEALS ERRED IN
DECLARING THAT SINCE PETITIONERS HAVE ALREADY
BEEN DECLARED NOT TO BE TENANTS OF THE
LANDOWNER, THEY ARE NOT QUALIFIED BENEFICIARIES
OF THE PROVISIONS OF THE CARP.
THE HONORABLE COURT OF APPEALS ERRED IN NOT
DISMISSING RESPONDENTS PETITION FILED BEFORE
SAID FORUM FOR FAILURE TO CITE AN EXPLANATION AS
TO THE MODES OF SERVICE.6
First, as to the issue of tenancy, we find no reason to
depart from the findings of the Court of Appeals that
herein petitioners were not bonafide tenants of the
landholding. Petitioners gave conflicting statements as to
their alleged tenancy over the landholding. At first, they
maintained that they had been tilling the land since 1979.
However, Deogracias Musa executed an affidavit on July 4,
1982 attesting the contrary- that he was not a tenant of
Rosario Dasig.7 Later on, petitioners admitted the
execution of such affidavit and claimed that there was no
inconsistency because their cultivation of the subject
property was commenced after the execution of
affidavit.8 In another instance, petitioners alleged that they
took over the cultivation of the land from Juan Manlangit
in 1984.9 These conflicting assertions detract from the
veracity of petitioners claim of tenancy.
The Court of Appeals also noted that the testimony of Juan
Manlangit, presented by petitioners, cannot be given
credence because he varied his statements three times. On
June 21, 1994, he executed an affidavit attesting to the
tenancy of Deogracias Musa over the landholding. He
retracted his statement on July 29, 1994 claiming that he
was misled into signing his June 24, 1994 affidavit. On
August 24, 1994, Manlangit executed another affidavit re-
affirming his first statement. The vacillating attitude of the
witness does not help petitioners any. As correctly ruled
by the Court of Appeals, petitioners evidence failed to
substantially prove their claim of tenancy over the subject
landholding.
Petitioners dispute the Court of Appeals statement in its
resolution denying petitioners motion for reconsideration
Page 18
that since they are not tenants of the subject landholding,
they are not qualified beneficiaries under CARP.10 They
argue that such a conclusion is contrary to the Court of
Appeals pronouncement that the issue of whether the
subject landholding is covered by P.D. 27 or R.A. 6657 is
within the exclusive jurisdiction of the Secretary of the
Department of Agrarian Reform. Moreover,
assuming arguendo that petitioners are not tenants of the
landholding, they are still qualified beneficiaries as
farmworkers because R.A. 6657 does not limit the scope of
qualified beneficiaries to tenants alone.11 On this score, the
Court of Appeals itself stated in its decision that it is "in full
accord with [the DARAB] ruling that the DAR Secretary has
authority to determine whether the subject landholding is
subject to the provisions of P.D. No. 27 or R.A. 6657."12
It should be pointed out that identification of actual and
potential beneficiaries under CARP is vested in the DAR
Secretary. Administrative Order No. 10, Series of 1989
provides:
ADMINISTRATIVE ORDER NO. 10
Series of 1989
SUBJECT: RULES AND PROCEDURES GOVERNING THE
REGISTRATION OF BENEFICIARIES
I. PREFATORY STATEMENT
Pursuant to Section 15, Chapter IV, of the Comprehensive
Agrarian Reform Law of 1988, the DAR, in coordination
with the Barangay Agrarian Reform Committee (BARC), as
organized pursuant to RA 6657, shall register all
agricultural lessees, tenants and farmworkers who are
qualified beneficiaries of the CARP. This Administrative
Order provides the Implementing Rules and Procedures
for the said registration.
II. OBJECTIVES.
A. General
1. Develop a data bank of potential and qualified
beneficiaries of the CARP for the effective implementation
of the program.
B. Specific
1. Identify the actual and potential farmer-beneficiaries of
the CARP. (Underscoring ours.)
xxx
It is significant to note that on September 3, 1993, the DAR
Secretary through the Municipal Agrarian Reform Office
(MARO) issued a Notice of Coverage placing the entire
agricultural landholding, including the subject property,
under CARP. Such being the case, the appellate courts
pronouncement that petitioners are not qualified
beneficiaries under CARP is just an obiter dictum and not
necessary in the resolution of the issues.
Petitioners also allege that the Court of Appeals should not
have given due course to the petition because the
respondent failed to attach thereto a written explanation
why personal service was not done, thereby violating
Section 11, Rule 13, of the Rules of Court. The Court of
Appeals found the service of petition by registered mail
sufficient notwithstanding the absence of an explanation
why service by mail was resorted to. Citing the case
of Reyes vs. Court of Appeals,13 it declared that "the Rules of
Rule 72: Subject Matter and Applicability of General Rules
Court shall not be applicable in agrarian cases even in
suppletory character."
The issue of sufficiency of service of pleadings pertains to
the proceedings of the Court of Appeals which are
governed by the Rules of Court. Section 11, Rule 13 of said
Rules provides:
SEC. 11. Priorities in modes of service and filing. - Whenever
practicable, the service and filing of pleadings and other
papers shall be done personally. Except with respect to
papers emanating from the court, a resort to other modes
must be accompanied by a written explanation why the
service or filing was not done personally. A violation of this
Rule may be cause to consider the paper as not filed.
As the above-quoted provision requires, service and filing
of pleadings must be done personally whenever
practicable. The Court notes that in the present case,
personal service would not be practicable. Considering the
distance between the Court of Appeals and Donsol,
Sorsogon where the petition was posted, clearly, service by
registered mail would have entailed considerable time,
effort and expense. A written explanation why service was
not done personally might have been superfluous. In any
case, as the rule is so worded with the use of "may,"
signifying permissiveness, a violation thereof gives the
court discretion whether or not to consider the paper as
not filed. While it is true that procedural rules are
necessary to secure an orderly and speedy administration
of justice,14 rigid application of Section 11, Rule 13 may be
relaxed in this case in the interest of substantial
justice.1wphi1.nt
WHEREFORE, the petition is hereby DENIED and the
decision of the Court of Appeals in C.A. G.R. S.P. No. 49263
dated September 27, 1999 is AFFIRMED.
SO ORDERED.
G.R. No. L-26306 April 27, 1988
TESTATE ESTATE OF THE LATE GREGORIO VENTURA
MARIA VENTURA, executrix- appellant, MIGUEL
VENTURA and JUANA CARDONA, heirs-appellants,
vs.
GREGORIA VENTURA and HER HUSBAND, EXEQUIEL
VICTORIO, MERCEDES VENTURA and HER HUSBAND,
PEDRO D. CORPUZ, oppositors-appellees.
PARAS, J.:
This is an appeal from the order of the Court of First
Instance of Nueva Ecija, Guimba, Branch V in Special
Proceedings No. 812, Testate of the late Gregorio Venture,
dated October 5, 1965, removing the appellant Maria
Ventura as executrix and administratrix of the estate of the
late Gregorio Ventura, and in her place appointing the
appellees Mercedes Ventura and Gregoria Ventura as joint
administratrices of the estate. (Record on Appeal, pp. 120-
131.)
Appellant Maria Ventura is the illegitimate daughter of the
deceased Gregorio Ventura while Miguel Ventura and
Juana Cardona are his son and saving spouse who are also
the brother and mother of Maria Ventura. On the other
hand, appellees Mercedes and Gregoria Ventura are the
deceased's legitimate children with his former wife, the
late Paulina Simpliciano (Record on Appeal, p. 122) but the
Page 19
paternity of appellees was denied by the deceased in his
will (Record on Appeal, p. 4).
On December 14,1953, Gregorio Ventura filed a petition
for the probate of his will which did not include the
appellees and the petition was docketed as Special
Proceedings No. 812 (Record on Appeal, pp. 1-3). In the
said will, the appellant Maria Ventura, although an
illegitimate child, was named and appointed by the
testator to be the executrix of his will and the
administratrix of his estate (Record on Appeal, p. 7).
In due course, said will was admitted to probate on
January 14,1954 (Record on Appeal, pp. 8-10). Gregorio
Ventura died on September 26,1955. On October 10, 1955,
the appellant Maria Ventura filed a motion for her
appointment as executrix and for the issuance of letters
testamentary in her favor (Record on Appeal, pp. 10-11).
On October 17, 1955, Maria Ventura was appointed
executrix and the corresponding letters testamentary was
issued in her favor (Record on Appeal, pp. 11-12).
On or about July 26, 1956, Maria Ventura submitted an
inventory of the estate of Gregorio Ventura (Record on
Appeal, pp. 12-20).
On June 17,1960, she filed her accounts of administration
for the years 1955 to 1960, inclusive. (Record on Appeal,
pp. 20-27). Said account of administration was opposed by
the spouses Mercedes Ventura and Pedro Corpuz on July
25, 1960 (Record on Appeal, pp. 27-33) and by Exequiel
Victorio and Gregoria Ventura on August 5,1963 (Record
on Appeal, pp. 46-50). Both oppositions assailed the
veracity of the report as not reflecting the true income of
the estate and the expenses which allegedly are not
administration expenses. But on January 25, 1961, Maria
Ventura filed a motion to hold in abeyance the approval of
the accounts of administration or to have their approval
without the opposition of the spouses Mercedes Ventura
and Pedro Corpuz and Gregoria Ventura and Exequiel
Victorio on the ground that the question of the paternity of
Mercedes Ventura and Gregoria Ventura is still pending
final determination before the Supreme Court and that
should they be adjudged the adulterous children of
testator, as claimed, they are not entitled to inherit nor to
oppose the approval of the counts of administration
(Record on Appeals, pp. 33-36). Spouses Mercedes Ventura
and Pedro Corpuz filed on February 2, 1961 their
opposition to the motion to hold in abeyance the approval
of the accounts of administration on the ground that
Mercedes and Gregoria Ventura had already been declared
by the Court of First Instance in Civil Cases No. 1064 and
1476, which cases are supposed to be pending before the
Supreme Court, as the legitimate children of Gregorio
Ventura, hence, they have reason to protect their interest
(Record on Appeal, pp. 36-39). On February 9,1961, the
motion to hold in abeyance the approval of the accounts
was denied (Record on Appeal, pp. 39-40).
It appears that on July 12, 1963, the Court set the case for
pre-trial on August 7, 1963 in connection with the
accounts of the executrix Maria Ventura dated June 17,
1960 and the Motion to Annul Provision of Will dated July
14,1962 of Mercedes Ventura (Record on Appeal, p. 45).
On October 22, 1963, four motions were filed by Mercedes
Ventura and Gregoria Ventura, namely: (1) motion to
remove the executrix Maria Ventura which was
supplemented on April 27, 1965; (2) motion to require her
to deposit the harvest of palay of the property under
administration in a bonded warehouse; (3) motion to
Rule 72: Subject Matter and Applicability of General Rules
render an accounting of the proceeds and expenses of
Administration; and (4) motion to require her to include in
the inventory of the estate certain excluded properties
(Record on Appeal, pp. 50-53; 71). An opposition to said
motions was filed by the heirs Juana Cardona and Miguel
Ventura and by the executrix Maria Ventura herself
(Record on Appeal, pp. 56-61; 61-70 and 71).
On motion of counsel for Exequiel Victorio and Gregoria
Ventura the joint motions to require an Up-to-date
Accounting and to Require Executrix Ventura to Include
Excluded Properties in Her Inventory were ordered
withdrawn (Order dated February 2, 1965, Record on
Appeal, p. 73). The other two motions were however set
for hearing.
The grounds of aforesaid joint motions to remove the
executrix Maria Ventura are: (1) that she is grossly
incompetent; (2) that she has maliciously and purposely
concealed certain properties of the estate in the inventory;
(3) that she is merely an illegitimate daughter who can
have no harmonious relations with the appellees; (4) that
the executrix has neglected to render her accounts and
failed to comply with the Order of the Court of December
12, 1963, requiring her to file her accounts of
administration for the years 1961 to 1963 (Record on
Appeal, pp. 70 and 75-76) and the Order of June 11, 1964,
reiterating aforesaid Order of December 12, 1963 (Record
on Appeal, p. 76); and (5) that she is with permanent
physical defect hindering her from efficiently performing
her duties as an executrix (Record on Appeal, pp. 50-53
and 74-79).
On May 17, 1965, the executrix Maria Ventura finally
submitted her accounts of administration covering the
period 1961 to 1965 (Record on Appeal, pp. 79-84) which
were again opposed by the spouses Exequiel Victorio and
Gregoria Ventura on September 21, 1965 and by the
spouses Mercedes Ventura and Pedro Corpuz on
September 29, 1965 (Record on Appeal, pp. 106-120). On
June 2, 1965, the executrix filed her supplemental
opposition to the aforesaid four motions, and prayed that
the joint supplemental motion to remove the executrix be
denied or held in abeyance until after the status of
Mercedes and Gregoria Ventura as heirs of the testator is
finally decided (Record on Appeal, pp. 85-1 01). On June 3,
1965, the Court, finding that the estate taxes have not been
paid, ordered the administratrix to pay the same within
thirty (30) days. On September 13, 1965, the lower court
denied the suspension of the proceedings and deferred the
resolution of the joint motion to remove executrix Maria
Ventura until after the examination of the physical fitness
of said executrix to undertake her duties as such. Also, it
ordered the deposit of all palay to be harvested in the next
agricultural year and subsequent years to be deposited in a
bonded warehouse to be selected by the Court and the
palay so deposited shall not be withdrawn without the
express permission of the Court (Record on Appeal, pp.
103-105). On September 21, 1965, spouses Exequiel
Victorio and Gregoria Ventura filed their opposition to the
accounts of administration of Maria Ventura dated May 17,
1965, while that of spouses Mercedes Ventura and Pedro
Corpuz was filed on September 29, 1965, both oppositions
alleging among others that said accounts do not reflect the
true and actual income of the estate and that the expenses
reported thereunder are fake, exhorbitant and speculative
(Record on Appeal, pp. 106-120).
On October 5, 1965, the court a quo, finding that the
executrix Maria Ventura has squandered the funds of the
estate, was inefficient and incompetent, has failed to
Page 20
comply with the orders of the Court in the matter of
presenting up-to-date statements of accounts and
neglected to pay the real estate taxes of the estate,
rendered the questioned decision, the dispositive portion
of which reads:
WHEREFORE, Maria Ventura is hereby removed as
executrix and administratrix of the estate and in her place
Mercedes Ventura and Gregoria Ventura are hereby
appointed joint a tratrices of the estate upon filing by each
of them of a bond of P 7,000.00. Let letters of
administration be issued to Mercedes Ventura and
Gregoria Ventura upon their qualification.
IT IS SO ORDERED.
(Record on Appeal pp. 120-131).
Hence, this appeal.
In their brief, appellants Maria Ventura and spouses Juana
Cardona and Miguel Ventura assign the following errors
allegedly committed by the probate court:
ASSIGNMENT OF ERRORS
I Brief for the Appellants, pp. 1-4)
The lower court erred in ordering the removal of Maria
Ventura as executrix and administratrix of the will and
estate of the deceased Gregorio Ventura without giving her
full opportunity to be heard and to present all her
evidence.
II
The lower court erred in finding that the executrix Maria
Ventura had squandered and dissipated the funds of the
estate under her administration.
III
The lower court erred in finding that the executrix Maria
Ventura was inefficient and incompetent.
IV
That, considering the circumtances surrounding the case,
the lower court erred in finding that the failure of Maria
Ventura to submit her periodical account had justified her
removal as executrix.
V Ventura. (Record on Appeal, p. 95). Gregoria and Mercedes
The lower court erred in considering as an established fact
that the appellees Mercedes Ventura and Gregoria Ventura
are the legitimate daughters of the deceased Gregorio
Ventura.
VI
The lower court erred in finding that the devises and
bequests in favor of Maria Ventura and Miguel Ventura as
specified in paragraph 8 of the last Will and Testament of
the late Gregorio Ventura have ipso facto been annulled.
VII
The lower court erred in allowing the appellees Mercedes
Ventura and Gregoria Ventura to intervene in the hearing
of the accounts of administration submitted by the
executrix Maria Ventura and/or in not suspending the
hearing of the said accounts until the said appellees have
Rule 72: Subject Matter and Applicability of General Rules
finally established their status as legitimate children of the
deceased Gregorio Ventura.
VIII
The lower court erred in appointing (even without a
proper petition for appointment and much less a hearing
on the appointment of) the appellees Mercedes Ventura
and Gregoria Ventura who have an adverse interest as
joint administratrices of the estate of the deceased
Gregorio Ventura.
IX
The lower court erred in not appointing the surviving
widow, Juana Cardona, or Miguel Ventura, as
administratrix of the estate of Gregorio Ventura in case the
removal of Maria Ventura as executrix and administratrix
thereof is legally justified.
X
Considering that there are in fact two (2) factions
representing opposite interests in the estate, the lower
court erred in not appointing Juana Cardona, or Miguel
Ventura, as one of the two (2) administratrices.' (Joint
On July 19,1967, Atty. Arturo Tolentino (representing
appellees Mercedes Ventura and Pedro Corpuz) and Atty.
Jose J. Francisco (representing Gregoria and Exequiel
Victoria), having failed to submit their respective briefs
within the period for the purpose, which expired on July 2
and May 29,1967, respectively, the Supreme Court
Resolved to consider this case submitted for decision
WITHOUT SAID APPELLEES' BRIEF (Rollo, p. 152).
The crucial issue in this case is whether or not the removal
of Maria Ventura as executrix is legally justified. This issue
has, however, become moot and academic in view of the
decision of this Court in related cases.
At the outset, it is worthy to note that aside from the
instant special proceedings, there are two other civil cases
involving the estate of the deceased Gregoria Ventura,
namely, Civil Cases Nos. 1064 and 1476. Civil Case No.
1064 was filed on December 2, 1952 by herein appellee
Gregoria Ventura in the Court of First Instance of Nueva
Ecija, Branch I, against the other appellees herein
Mercedes Ventura and their father, Gregorio Ventura.
Later Mercedes Ventura joined cause with Gregoria
Ventura claimed that they are the legitimate children of
Gregorio Ventura and his wife Paulina Simpliciano, who
died in 1943, and asked that one-half of the properties
described in the complaint be declared as the share of
their mother in the conjugal partnership, with them as the
only forced heirs of their mother Paulina (Joint Brief for
the Appellants, pp. 53-68).
Subsequently, Civil Case No. 1476 was filed by Alipio,
Eufracia and Juliana, all surnamed Simpliciano, against
Gregorio Ventura and the two sisters, Mercedes and
Gregoria Ventura, before the Court of First Instance of
Nueva Ecija, Branch I. They alleged that as the only
children of Modesto Simpliciano, sole brother of Paulina
Simpliciano, they, instead of Mercedes and Gregoria
Ventura, whom they claimed are adulterous children of
Paulina with another man, Teodoro Ventura and as such
are not entitled to inherit from her, are the ones who
should inherit the share of Paulina Simpliciano in the
Page 21
conjugal Partnership with Gregorio Ventura (Joint Brief
For The Appealant,pp.69-79)
It appears that on November 4, 1959, after a joint hearing
of Civil Cases Nos. 1064 and 1476, the lower court
rendered its judgment, the dispositive portion of which
reads as follows:
WHEREFORE, judgment is hereby rendered declaring
Mercedes Ventura and Gregoria Ventura to be the ligitimate
daughters of Paulina Simpliciano and Gregorio Ventura;
declaring that as such ligitimate daughters of Paulina
Simpliciano they are entitled to 1/2 of the properties
described in paragraph six of the complaint; ordering the
defendant Maria Ventura, as administratrix of the estate of
Gregorio Ventura to pay to Mercedes Ventura and Gregorio
Ventura the amount of P 19,074.09 which shall be divided
equally between Mercedes and Gregoria Ventura declaring
Mercedes Ventura and Pedro Corpuz are the exclusive
owners of the property describe in the certificate of Title
Nos. T-1102, 212, T-1213, T-1214, Exhibits 32, 33, 34 and
35, respectively; ordering Mercedes Ventura and Pedro D.
Corpuz to pay to the conjugal partnership of Gregorio
Ventura and Paulina Simpliciano the sum of P100,000.00,
one-half of which shall pertain to the estate of Gregorio
Ventura and the other half to the estate of Paulina
Simpliciano to whom Mercedes and Gregoria Ventura have
succeeded, to be divided between Mercedes and Gregoria
in equal parts; and dismissing Civil Case No. 1476. The
parties are urged to arrive at an amicable partition of the
properties herein adjudicated within twenty days from
receipt of this decision. Upon their failure to do so, the
Court shall appoint commissioners to divide the properties
in accordance with the terms of the decision. Without
pronouncements as to costs. (Emphasis supplied). (Joint
Brief for the Appellants, pp. 3738.)
Thereafter, on July 14, 1962, Mercedes Ventura filed a
motion to annul the provisions of the will of the deceased
Gregorio Ventura in Special Proceedings No. 812, which
motion was opposed by Miguel Ventura and Juana Cardona
and later by Maria Ventura. They claimed that the decision
dated November 4,1959 in Civil Cases Nos. 1064 and 1476
was not yet final.
On February 26,1964, the court annulled the institution of
the heirs in the probated will of Gregorio Ventura. The
motion for reconsideration of the aforesaid order filed by
executrix Maria Ventura was denied on June 11, 1964.
Accordingly, Maria Ventura appealed the February 26,
1964 and June 11, 1964 orders of the probate court in
Special Proceedings No. 812 before the Supreme Court and
was docketed as G.R. No. L-23878. On May 27,1977, this
Court, through then Associate Justice Antonio P. Barredo,
ruled, as follows:
And so, acting on appellees' motion to dismiss appeal, it is
Our considered opinion that the decision in Civil Cases
Nos.1064 and 1476 declaring that appellees Mercedes and
Gregoria Ventura are the ligimate children of the deceased
Gregorio Ventura and his wife, Paulina Simpliciano, and as
such are entitled to the annulment of the institution of heirs
made in the probated will of said deceased became final and
executory upon the finality of the order, approving ther
partition directed in the decision in question. We need not
indulge in any discussion as to whether or not, as of the
time the orders here in question were issued by the trial
court said decision had the nature of an interlocutory
order only. To be sure, in the case of Miranda,
aforementioned, the opinion of the majority of the Court
Rule 72: Subject Matter and Applicability of General Rules
may well be invoked against appellant's pose. In any event,
even if the Court were minded to modify again Miranda
and go back to Fuentebella and Zaldariaga and it is not,
as of now there can be no question that the approval by
the trial court in Civil Cases Nos. 1064 and 1476 of the
partition report of the commissioners appointed for the
purpose, one of whom, Emmanuel Mariano, is the husband
of appellant, put a definite end to those cases, leaving
nothing else to be done in the trial court. That order of
approval is an appealable one, and inasmuch as no appeal
has been taken from the same, it is beyond dispute that the
decision in controversy has already become final and
executory in all respects. Hence, the case at bar has
become moot and academic. (Ventura vs. Ventura, 77 SCRA
159, May 27,1977)
Under Article 854 of the Civil Code, "the pretention or
omission of one, some, or all of the compulsory heirs in the
direct line, whether living at the time of the execution of
the will or born after the death of the testator, shall annul
the institution of heir; but the devises and legacies shall be
valid insofar as they are not inofficious," and as a result,
intestacy follows, thereby rendering the previous
appointment of Maria Ventura as executrix moot and
academic. This would now necessitate the appointment of
another administrator, under the following provision:
Section 6, Rule 78 of the Rules of Court:
When and to whom letters of administration granted.-If no
executor is named in the will, or the executor or executors
are incompetent, refuse the trust, or fail to give bond, or a
person dies intestate, a petition shall be granted:
(a) To the surviving husband or wife, as the case may be or
next of kin, or both, in the discretion of the court, or to
such person as such surviving husband or wife, or both, in
the discretion of the court, or to such person as such
surviving husband or wife, or next of kin, requests to have
appointed, if competent and willing to serve;"
xxx xxx xxx
In the case at bar, the surviving spouse of the deceased
Gregorio Ventura is Juana Cardona while the next of kin
are: Mercedes and Gregoria Ventura and Maria and Miguel
Ventura. The "next of kin" has been defined as those
persons who are entitled under the statute of distribution
to the decedent's property (Cooper vs. Cooper, 43 Ind. A.
620, 88 NE 341). It is generally said that "the nearest of
kin, whose interest in the estate is more preponderant, is
preferred in the choice of administrator. 'Among members
of a class the strongest ground for preference is the
amount or preponderance of interest. As between next of
kin, the nearest of kin is to be preferred." (Cabanas, et al.
vs. Enage et al., 40 Off. Gaz. 12 Suppl. 227; citing 12 Am.
Jur. Sec. 77, p. 416, cited in Francisco Vicente J., The
Revised Rules of Court in the Philippines, Vol. V-B 1970
Ed., p. 23).
As decided by the lower court and sustained by the
Supreme Court, Mercedes and Gregoria Ventura are the
legitimate children of Gregorio Ventura and his wife, the
late Paulina Simpliciano. Therefore, as the nearest of kin of
Gregorio Ventura they are entitled to preference over the
illegitimate children of Gregorio Ventura, namely: Maria
and Miguel Ventura. Hence, under the aforestated
preference provided in Section 6 of Rule 78, the person or
persons to be appointed administrator are Juana Cardona,
as the surviving spouse, or Mercedes and Gregoria Ventura
as nearest of kin, or Juana Cardona and Mercedes and
Page 22
Gregoria Ventura in the discretion of the Court, in order to
represent both interests.
PREMISES CONSIDERED, the appeal interposed by
appellants Maria Ventura, Juana Cardona and Miguel
Ventura is hereby DISMISSED.
SO ORDERED.
G.R. No. 26751 January 31, 1969
JOSE S. MATUTE, petitioner,
vs.
THE COURT OF APPEALS (Third Division) and MATIAS
S. MATUTE, respondents.
---------------------------
G.R. No. L-26085 January 31, 1969
JOSE S. MATUTE, in his personal capacity and as
Judicial Co-Administrator of the Estate of AMADEO
MATUTE OLAVE, petitioner,
vs.
HON. JUDGE VICENTE P. BULLECER, Judge of the Court
of First Instance of Davao, Branch IV, and MARIANO
NASSER, respondents.
---------------------------
G.R. No. L-26106 January 31, 1969
JOSE S. MATUTE AND LUIS S. MATUTE, as Intervenors
in their personal capacities in Civil Case No. 4252 of
the Court of First Instance of Davao, petitioners,
vs.
HON. VICENTE P. BULLECER, Judge of the Court of First
Instance of Davao, Branch IV; ATTY. PATERNO R.
CANLAS, DANIEL RIVERA, SR., PABLO V. DEL ROSARIO
and NICANOR D. VERGARA, as Defendants in Civil Case
No. 4252, of the Court of First Instance of
Davao, respondents.
Antonio Enrile Inton for petitioners.
Paterno R. Canlas for and in his own behalf as respondent.
CASTRO, J.:
The present three petitions for certiorari with
preliminary injunction (L-26571, L-26085 and L-26106)
were separately interposed within the short span of five
months by Jose S. Matute, one of the fifteen heirs to the
Amadeo Matute Olave estate. Because these petitions are
intertwined in several material aspects and arose from a
common environmental setting the intra-fraternal strife
among the Matute heirs which has unduly delayed for
more than a decade the settlement of the Matute estate
this Court has decided to embody in a single decision the
independently discussed resolutions of the issues raised in
the said petitions.
L-26751
Although the petition in L-26751 was filed the latest
(October 27, 1966), we shall dispose of it first because our
pronouncements and observations in this case have direct
and concrete relevance to the other two.
The antecedent events trace their origin to August 20,
1965 when Carlos S. Matute, one of the Matute heirs and a
full-blood brother of both the petitioner and the herein
respondent Matias S. Matute, filed in special proceeding
25876 (settlement of the Matute estate) a petition praying
Rule 72: Subject Matter and Applicability of General Rules
for the removal of Matias as co-administrator and his
(Carlos') appointment in such capacity. Carlos alleged that
"for a period of more than two years from the date of his
appointment (on May 29, 1963), said Matias S. Matute has
neglected to render a true, just and complete account of his
administration," and that he "is not only incompetent but
also negligent in his management of the estate under his
charge consisting of five haciendas on account of a criminal
charge for murder filed against him which is occupying
most of his time."1awphil.t
The respondent Matias claims that he forthwith
interposed an opposition to the aforesaid petition, and the
record discloses that he later filed an amended opposition
dated August 25, 1965 wherein he contended.
1. That the allegation ... that the herein co-administrator
for the two years of his administration, 1963 and 1964, did
not render any accounting is completely without basis and
false, because the records show that under date of May
20,1964, he submitted to this Honorable Court with copies
furnished to all the parties concerned, including Carlos S.
Matute, his accounting for 1963, that on Feb. 8, 1965, he
filed his accounting for 1964, which accounts for 1963 and
1964 have been approved by majority of the heirs
composing of 63% interests in the estate as shown by the
attached manifestation....
2. That his competence to act as administrator has been
established to the satisfaction of this Honorable Court as
evidenced by his appointment by a fixed,
final and executory order dated May 29, 1963; and Carlos S.
Matute is now estopped from denying his [Matias S.
Matute's] competence and qualification by reason of his
failure to object to the appointment of herein Judicial
Administrator at the time the application was made
therefor;
3. .... The records of the pertinent case in the Court of First
Instance ofDavao will easily discover that the "criminal
charge" supported by perjuredtestimony is nothing but a
trumped-up affair initiated by persons intent
onintimidating the herein Judicial Administrator into
betraying his sworn dutyto protect and safeguard the
interest of the Estate. The records of the saidcase will also
reveal that it has not occupied any time at all of the herein
Judicial Administrator, for aside from a single hearing last
December 1964 onhis application for bail ... no hearing has
been held on the said case up tothe present.
Subsequently, Matias filed a memorandum dated
September 12, 1965 in support of his foregoing opposition.
On September 21, 1965 the heirs of Agustina Matute
Candelario, Elena MatuteCandelario and Amadeo Matute
Candelario and their mother and legatee
AnunciacionCandelario, moved for the immediate
appointment of Agustina Matute Candelario,Carlos S.
Matute and Jose S. Matute, herein petitioner, as joint co-
administratorsor anyone of them in place of Matias S.
Matute, whose removal they also soughttogether with the
ouster of the general administrator Carlos V. Matute, on
thefollowing additional grounds:
1. Despite the vast resources and income of the estate, the
present administrators have failed to pay even the annual
real property tax for the years 1964 and 1965;
2. The financial statements of both administrators were
not properly signed andauthenticated by a certified public
accountant, and do not contain the exactentries as filed by
Page 23
former administrators containing the daily and monthly
entriesof receipts and disbursements;
3. Both administrators have deliberately failed to file their
inventories andstatements of accounts of time, and did so
only when ordered by the probatecourt;
4. Both administrators have made unauthorized
disbursements as shown by theirfinancial statements; and
5. The probate court has discretion to remove the
administrator.
It appears that during the reception of evidence
conducted on December 29, 1965by the probate court
(Branch IV of the Court of First Instance of Manila
withHonorable Emigdio Nietes as the then presiding
judge), Carlos S. Matute and theCandelario-Matute heirs
submitted respective lists of exhibits in support oftheir
motion to oust Matias. On January 8, 1966 Matias filed a
written objectionto the admission of the movants' exhibits
on the ground that the same were hearsay,self-serving,
irrelevant and/or mere photostatic copies of supposed
originalswhich were never properly identified nor shown
in court. Four days later, or onJanuary 12, 1966, the
counsel for Matias filed with leave of court a "Motion
toDismiss and/or Demurrer to Evidence" which avers that
"there is no sufficientevidence on record to justify and
support the motions for the removal of theherein co-
administrator Matias S. Matute." In the same motion, said
counselreserved the right to introduce evidence in behalf
of his client should theforegoing motion be denied.
On January 31, 1966 the probate court issued an order,
the dispositive portionof which reads:
FOR ALL THE FOREGOING, the Court hereby removes co-
administrator, Matias S.Matute, as such co-administrator
of the estate and orders him to submit a finalaccounting of
his administration together with his past administration
accountswhich have not been approved, and, in his stead
appoints Jose S. Matute, a brother by the same mother of
Matias S. Matute, as co-administrator, who ishereby
required to put up a bond of P15,000.00, and thereafter
immediatelyqualify in his commission and assume the
responsibility of co-administrator....
Forthwith, Matias interposed with the Court of Appeals a
petition for certiorari with preliminary mandatory
injunction (CA-G.R. 37039-R) dated February 1, 1966,
praying that the aforesaid order of January 31, 1966 be set
aside as a nullityfor having decreed his removal without
due process and the appointment of JoseS. Matute without
the requisite hearing.
On March 4, 1966 the Court of Appeals gave due course to
the aforesaid petitionand resolved to grant a writ of
preliminary injunction against Jose S. Matuteand the
Honorable Judge Emigdio Nietes, respondents in CA-G.R.
37039-R, conditioned on the filing of a P1,000 bond by the
therein petitioner Matias, the respondentherein. On March
22, 1966 Jose S. Matute moved for the dismissal of the
abovementionedpetition on the ground that the Court of
Appeals does not have jurisdiction totake cognizance of
the same since the value of the estate involved is more
thanP200,000. He further contended that the value of the
Amadeo Matute Olave estatefor purposes of jurisdiction
had already been resolved in CA-G.R. 35124-R wherethe
Court of Appeals refused to take jurisdiction over a
petition for certiorari contesting the appointment of
Matias Matute as co-administrator, on the groundthat the
value of the Matute estate was placed at P2,132,282.72 as
Rule 72: Subject Matter and Applicability of General Rules
evidenced by a "Compromise Agreement" dated April 12,
1956 which was duly signed by all of the heirs.
Despite repeated urgent motions filed by Jose S. Matute
praying that the Courtof Appeals resolve with dispatch the
issue of jurisdiction, the said appelatetribunal instead
required then respondent Jose S. Matute to answer, which
he did.However, on October 27, 1966 herein petitioner
Jose S. Matute interposed theinstant petition
for certiorari with preliminary injunction against the Court
of Appeals and Matias Matute, challenging the jurisdiction
of the respondentCourt of Appeals upon two basic
contentions:
The Court of Appeals has no jurisdiction to entertain, give
due course, andmuch more to issue a writ of preliminary
injunction, against the petitioner, Jose S. Matute, and
respondent Judge Emigdio Nietes in CA-G.R. No. 37039-R ...
because the estate of Amadeo Matute Olave is worth more
than P200,000.00; and
The same Court of Appeals in CA-G.R. No. 35124-R, on
January 27, 1965, specialfourth division, has ruled that the
Court of Appeals has no jurisdiction on theestate of
Amadeo Matute Olave in the matter of the appointment
and removal ofits administrators.
The respondent Matias Matute does not controvert the
petitioner's claim that thevalue of the estate of their
deceased father exceeds P200,000. He maintains,however,
that the respondent Court of Appeals has jurisdiction over
CA-G.R.37039-R "because the subject matter involved is
merely ... the right to collectthe (monthly) rentals due the
Estate in the sum of P5,000.00" pursuant to acontract of
lease which he executed in favor of one Mariano Nasser
coveringfive haciendas of the estate under his separate
administration.
The foregoing assertion does not merit credence. A
searching review of the record from the initial petition
filed by Carlos Matute to oust the respondentas co-
administrator up to the latter's petition for certiorari filed
with theCourt of Appeals impugning the validity of the
abovementioned order of January31, 1966 which removed
him as co-administrator and appointed the petitioner inhis
place reveals no single pleading, statement, contention,
reference or eveninference which would justify the
respondent's pretension that the instantcontroversy is a
mere contest over the right to collect a P5,000 rental. In
bold contrast, the record vividly chronicles the
controversy as a bitter fight for co-administration: the
removal of the respondent as co-administrator and the
appointment of anyone of the movants and the herein
petitioner as new co-administrator. Indeed, the principal
conflict gravitates over the right to co-administer the vast
Amadeo Matute Olave estate. This is the same issue
underlying the respondent'sabovementioned petition in
CA-G.R. 37039-R. The respondent's prayer in said petition
unmistakably indicates that the dispute pertains to the
right to co-administer in general, not the mere authority to
collect a P5,000 monthly rental.The said prayer reads:
1. That an ex parte writ of preliminary mandatory
injunction be issued enjoiningand/or prohibiting the
respondent Judge from approving the administrator's
bondthat will be filed by respondent Jose S. Matute and in
issuing the letters ofadministration of the latter, and from
issuing Orders incidental and/or connectedwith the
exercise and performance of acts of administration of said
respondent Jose S. Matute; likewise enjoining and
prohibiting respondent Jose S. Matutehimself, and/or
Page 24
through his counsels, agents and representatives from
takingphysical possession of the different haciendas under
the exclusive administrationand management of herein
petitioner and from performing and exercising acts ofa
duly and legally appointed administrator, upon filing a
bond in such amountthat this Honorable Tribunal may fix;
2. That the Order of the respondent Judge dated January
31, 1966, removing herein petitioner as co-administrator
of the Estate of Amadeo Matute Olave andappointing
respondent Jose S. Matute as co-administrator without
presentationof evidence, be declared null and void and of
no force and effect....
In fine, the pith of the controversy is the right to co-
administer the entire estate. In this regard, the ruling
in Fernandez, et al. vs. Maravilla 1 is determinative of the
jurisdictional issue posed here. In said case, this
Courtruled that in a contest for the administration of an
estate, the amount incontroversy is deemed to be the value
of the whole estate, which total valueshould be the proper
basis of the jurisdictional amount. Consequently the
Courtproceeded to conclude that the Court of Appeals does
not have jurisdiction toissue writs of certiorari and
preliminary injunction prayed for in a petition concerning
a conflict over administration arising as an incident in the
mainprobate or settlement proceeding if in the first place
the principal case or proceeding falls outside its appelate
jurisdiction considering the total value of the subject estate.
This Court in the aforesaid Maravilla case elaborated thus:
The Court of Appeals, in the decision appealed from,
assumed jurisdiction overthe present case on the theory
that "the amount in controversy relative to
theappointment of Eliezar Lopez as special co-
administrator to protect the interestsof the respondents
(herein petitioners) is only P90,000.00 more or less,
i.e.,one fourth of the conjugal property" (of respondent and
the deceased DignaMaravilla) which, as per inventory
submitted by the respondent as special administrator, is
valued at P362,424.90. This theory is untenable. Note that
theproceedings had on the appointment of Eliezar Lopez as
special co-administrator are merely incidental to the
probate or testate proceedings of the deceased Digna
Maravilla.
That the Court of Appeals have no appelate jurisdiction
over the said testateproceedings cannot be doubted,
considering the properties therein involved arevalued at
P362,424.00, as per inventory of the special administrator.
... Not having appelate jurisdiction over the proceedings in
probate (CA-G.R.No. 27478-R), considering that the amount
involved therein is more than P200,000.00,the Court of
Appeals cannot also have original jurisdiction to grant the
writsof certiorari and prohibition prayed for by respondent
in the instant case, whichare merely incidental thereto....
Note also that the present proceedings under review were
for the annulment ofthe appointment of Eliezar Lopez as
special co-administrator and to restrain theprobate court
from removing respondent as special administrator. It is
therefore,a contest for the administration of the estate and,
consequently, the amount orvalue of the assets of the whole
estate is the value in controversy. (4 C.J.S. 204.) It appearing
that the value of the estate in dispute is much more than
P200,000.00, the Court of Appeals clearly had no original
jurisdiction to issuethe writs in question. (emphasis
supplied)
Rule 72: Subject Matter and Applicability of General Rules
Like in the aforecited Maravilla case, the instant intra-
fraternal controversy involves a contest over
administration, an incident in the settlement of the vast
Matute estate. Considering that the value of the said estate
is more thanP200,000, and considering further that as
enunciated in the Maravilla case thetotal value of the
subject estate determines the jurisdictional amount
anentdisputes over administration arising as incidents in a
probate or settlementproceeding, like the case at bar, then
it is indubitable that the respondent Court of Appeals does
not have jurisdiction over CA-G.R. 37039-R nor the judicial
authority to grant the writs of certiorari and prohibition
prayed fortherein.
Herein respondent insists, however, that even granting
that the actual controversy pertains to administration,
such contested administration does not encompassthe
whole estate but is limited to the collection of a P5,000
monthly rental,which sum should be the basis of the
jurisdictional amount, not the value ofthe whole estate. In
support of his thesis, the respondent alleges that duringhis
incumbency as co-administrator, five haciendas in Davao
belonging to theestate of his deceased father were
consigned to his separate administration; that in his
capacity as co-administrator he leased on February 10,
1965 said haciendas to one Mariano Nasser for P5,000 a
month; that by virtue of said leasecontract, the possession,
management and administration of the said properties
were transferred to the lessee until the expiration of the
contract; that consequently, only the collection of the
monthly rental of P5,000 remains asthe subject of the
administration.
The foregoing contention of the respondent is patently
untenable.
1. The averment of the respondent that the controversy
centers on the collectionof the alleged P5,000 monthly
rental and that the contest over administrationis limited
thereto, does not find any support in the record.
2. The rule remains that the jurisdictional amount is
determined by the totalvalue of the estate, not by value of
the particular property or portion of the estate subject to
administration, since the question of administration is
merely incidental to the principal proceeding for the
settlement and distribution ofthe whole estate.
3. The respondent's impression that a co-administrator's
trust and responsibilityare circumscribed and delimited by
the size and value of the particular propertyor portion of
the estate subject to his separate administration, is
erroneous. Although a co-administrator is designated to
admininister a portion of theestate, he is no less an
administrator of the whole because his
judiciousmanagement of a mere parcel enhances the value
of the entire estate, while hisinefficient or corrupt
administration thereof necessarily diminishes the valueof
the whole estate. Moreover, when two or more
administrators are appointed toadminister separate parts
of a large estate they are not to discharge theirfunctions in
distant isolation but in close cooperation so as to
safeguard andpromote the general interests of the entire
estate. The teaching in Sison vs.Teodoro 2 is of positive
relevance. In the said case, the probate court
chargedagainst the entire estate the compensation of an
administrator who was assignedas judicial administrator
representing the interests of one of the two heiresses.The
other heiress whose interest was represented by the
executor opposed theaward on the ground that the said
administrator had not rendered service to theestate but
Page 25
only to his wife, the heiress whom he represented. On
appeal, this Court upheld the award and dismissed the
opposition:
This argument erroneously assumes that because Carlos
Moran Sison was "judicial administrator representing the
interests of Priscilla F. Sison" he was such administrator
"solely for the purpose of protecting Priscilla's interests,"
and not to protect those of the estate. No words are needed
to explain that in general,the interest of the heir coincides
with those of the estate the bigger theestate the better for
the heir. Therefore to protect the interest of heiressPriscilla
usually meant to favor the interest of the estate (sic)....
Again, the argument presumes that an administrator
appointed by the Court for thepurpose of giving
representation to designated heirs, is not deemed
administratorof the estate. This assumption has no legal
foundation, because it is admitted practice, where the
estate is large, to appoint two or more administrators
ofsuch estate to have different interests represented and
satisfied, and furthermore,to have such representatives
work in harmony for the best interests of such estate. (In re
Drew's Estate, 236 N.W. 701, 2 C.J. p. 1183) (emphasis
supplied)
Verily, therefore, the scope of a co-administrator's trust
encompasses the entireestate and is co-extensive in effect
with those of the other administrators; consequently, the
value of the entire estate should be the proper basis of the
jurisdictional amount irrespective of the value of the
particular property orassets of the estate which are the
objects of a separate administration pending the
settlement proceedings.
In view of all the foregoing, we are of the consensus that
the respondent Courtof Appeals has no jurisdiction to take
cognizance of CA-G.R. 37039-R, and consequently was
without power to issue or grant the writs
of certiorariand prohibition prayed for in said case.
Notwithstanding that the herein petitioner delimited the
issue, as set forth inhis petition of certiorari, to one of
jurisdiction of the respondent Court of Appeals over CA-
G.R. 37039-R, in subsequent pleadings and manifestations,
however, the parties therein mutually expanded the issue
to include the question of the legality of the controverted
order of January 31, 1966 in CA-G.R. 37039-R. As a matter
of fact, the respondent, in a "Petition to Resolve" dated July
18,1967, prayed "that a decision on the merits in this case
be now rendered." To this manifestation, the petitioner
replied "that he has no objection, as in fact, he also prays
that this case be decided at the earliest by the Highest
Tribunal."
Since the respondent Court of Appeals does not have
jurisdiction over CA-G.R. 37039-R, we are of the
considered opinion that this Court can forestall further
delay in the already protracted proceedings regarding the
settlement of the Matute estate if it now proceeds to
resolve the issue of legality of the abovementioned
disputed order, rather than wait for the parties to come
anew on a separate petition in quest for a verdict on the
said issue. Moreover, both the petitioner and the
respondent private party have manifested and elaborated
their respective views on this issue and prayed and
pressed for a decision thereon.
We shall now discuss separately the twin aspects of the
foregoing controverted order, namely, (1) the removal of
the respondent as co-administrator of the Matute estate,
Rule 72: Subject Matter and Applicability of General Rules
and (2) the appointment of the petitioner as the new co-
administrator.
The respondent contends that the disputed order
removing him as co-administrator is a patent nullity for
the following reasons:
(1) He was removed in wanton disregard of due process of
law because the probatejudge arbitrarily deprived him of
his day in court;
(2) The evidence adduced by the movants is manifestly
insufficient, if not devoid of probative value, to warrant his
removal; and
(3) He was removed not on the grounds specifically
invoked by the movants but for causes discovered motu
propio by the probate judge in the records of
specialproceeding 25876 and without affording him the
opportunity to rebut the findingsof the said judge.
Upon the other hand, the petitioner advances the
following reasons in support of the order of removal:
(1) The probate judge accorded the respondent all the
opportunity to adduce hisevidence but the latter resorted
to dilatory tactics such as filing a "motion to dismiss or
demurrer to evidence";
(2) The evidences presented to sustain the removal of the
respondent are incontrovertible since aside from being
documentary, they are parts of the record of special
proceeding 25876; and
(3) The evidence on record conclusively supports the
findings of the probate judge.
The settled rule is that the removal of an administrator
under section 2 of Rule 82 lies within the discretion of the
court appointing him. As aptly expressed in one
case, 3 "The sufficiency of any ground for removal should
thus be determined by the said court, whose sensibilities
are, in the first place, affected by any act or omission on
the part of the administrator not conformable to or in
disregard of the rules or the orders of the court."
Consequently, appellate tribunals are disinclined to
interfere with the action taken by a probate court in the
matter of the removal of an executor or
administrator unless positive error or gross abuse of
discretion is shown. 4
In the case at bar, we are constrained, however to nullify
the disputed order of removal because it is indubitable
that the probate judge ousted the respondent from his
trust without affording him the full benefit of a day in
court, thus denying him his cardinal right to due process.
It appears that shortly after the reception of evidence for
the movants Carlos Matute and the Candelario-Matute
heirs, the respondent filed on January 8, 1966a verified
objection to the admission in evidence of the movants'
exhibits on the ground that the same were hearsay, self-
serving, irrelevant and/or mere photostatic copies of
supposed originals which were never properly identified
nor produced in court. Four days later, or on January 12,
1966, the respondent filed with leave of court a "Motion to
Dismiss and/or Demurrer to Evidence", the pertinent and
material portion of which reads:
... considering the specific objection to each exhibit
contained in said Objections to Admission of Movants'
Exhibits and considering further the ruling of this
Page 26
Honorable Court in open court that pleadings filed in this
case are evidence only of the fact of their filing and not of
the truth of the statements contained therein and
considering still further the fact that no competent single
witness was presented by movants in support of their
respective contentions, we submit that there is no sufficient
evidence on record to justify and support the motions for
removal of the herein co-administrator Matias S.
Matute and in the light of the authorities hereinbelow
cited, the motions to remove Matias S. Matute must be
dismissed for insufficiency of evidence.
... However, in the remote possibility that this instant
motion be denied by this Honorable Court, the herein co-
administrator expressly reserves his right to present his own
evidence ... at least five (5) days from the receipt of said
denial.... (emphasis supplied)
Instead of resolving the foregoing motion, the probate
judge issued the controverted order removing the
respondent as co-administrator without giving him the
opportunity to adduce his own evidence despite his
explicit reservation that he be afforded the chance to
introduce evidence in his behalf in the event of denial of
his motion to dismiss and/or demurrer to evidence. We
are of the view that the above actuation of the probate
judge constituted grave abuse of discretion which dooms
his improvident order as a nullity. In fact, even without the
respondent's reservation, it was the bounden duty of the
probate judge to schedule the presentation and reception
of the respondent's evidence before disposing of the case
on the merits because only the movants at that time had
presented their evidence. This duty is projected into
bolder relief if we consider, which we must, that the
aforesaid motion is in form as well as in substance
a demurrer to evidence allowed by Rule 35, by virtue of
which the defendant does not lose his right to offer
evidence in the event that his motion is denied. Said Rule
states:
After the plaintiff has completed the presentation of his
evidence, the defendant without waiving his right to offer
evidence in the event the motion is not granted, may move
for a dismissal on the ground that upon the facts and law
the plaintiff has shown no right to relief. (emphasis
supplied)
The application of the abovecited Rule in special
proceedings, like the case at bar, is authorized by section 2
of Rule 72 which direct that in the "absence of special
provisions, the rules provided for in ordinary civil actions
shall be, as far as practicable, applicable in special
proceedings."
But what is patently censurable is the actuation of the
probate judge in removing the respondent, not on the
strength of the evidence adduced by the movants (not a
single exhibit or document introduced by the movants was
specifically cited in the disputed order as a justification of
the respondent's ouster), but on the basis of his (judge's)
findings, which he motu propio gleaned from the records of
special proceeding 25876, without affording the
respondent an opportunity to controvert said findings or
in the very least to explain why he should not be removed
on the basis thereof.
The probate judge did find, as essayed in his disputed
order, that the respondent "has shown indifference to his
duties as such co-administrator of the estate" as evidenced
by:
Rule 72: Subject Matter and Applicability of General Rules
(1) the disapproval of his 1964 account by the probate
court in an order dated January 5, 1966 due to his "non-
appearance and non-submission of evidence to sustain his
account on the date set for the presentation of the same;"
(2) the considerable decrease in the income of the
properties under his charge, as reflected in said 1964
account, which circumstance "does not speak well of his
diligence and attention to the administration of said
properties;" and
(3) the failure of said 1964 account to disclose the number
of calves born during the accounting period, "thereby
indicating a palpable omission of fact which directly
reduced the value of the income or the increase of the
assets of the estate."
But, significantly, the movants did not specifically invoke
the aforesaid grounds in support of their petition to oust
the respondent. All of the said grounds, which in the mind
of the probate judge exposed the supposed indifference
and incompetence of the respondent in the discharge of his
trust, are based on alleged defects of the respondent's
1964 account. Under these circumstances, it behooved the
probate judge to inform the respondent of his findings
before ordering the latter's removal. We concede that the
probate judge enjoys a wide latitude of discretion in the
matter of the removal of executors and administrators and
he can cause their ouster at his own instance. However,
before they are deprived of their office they must be given
the full benefit of a day in court, an opportunity not
accorded to the respondent herein.
Without forgetting such patent denial of due process,
which rendered the order of removal a nullity, let us
examine the merits of the probate judge's motu propio
findings to determine whether they warrant the ouster of
the respondent.
As proof of the respondent's "indifference" in the
discharge of his duties, the probate judge cited the court's
order of January 5, 1966 disapproving the respondent's
1964 account for his failure to personally appear on the
date set for the submission of evidence in support of the
said account. It must be emphasized, however, that the
respondent, two days before the issuance of the aforesaid
order removing him as co-administrator, seasonably
moved for the reconsideration of the aforecited order of
January 5, 1966 on the ground that his failure to
personally attend the scheduled hearing was due to illness
on his part. Evidently, when the probate court decreed the
removal of the respondent, the order disapproving his
1964 account, which was used as one of the principal
justifications for his removal as co-admininistrator,
was not yet final as it was still subject to possible
reconsideration. As a matter of fact, on February 19, 1966
the same probate judge set aside the aforesaid order of
January 5, 1966, thus:
Considering that it will be the benefit of all the parties
concerned if former co-administrator Matias S. Matute will
be allowed to substantiate the accounting which he
submitted to this Court but which was disapproved on
January 5, 1966 for his failure to personally appear at the
hearing held for the purpose of substantiating said
accounting, his motion for reconsideration filed on January
28, 1966 is hereby granted and the order dated January 5,
1966 disapproving the accounting submitted by Matias S.
Matute is set aside. (emphasis supplied)
With the order of January 5, 1966 thus revoked, the
probate judge's conclusion that the respondent was
Page 27
"indifferent" to his duties as co-administrator as evidenced
by the disapproval of his 1964 account loses its principal
basis.
Again using the 1964 account of the respondent as basis
of his finding that the respondent was guilty of disinterest
in the discharge of his trust, the probate judge stressed
that "a verification of said accounting shows the income of
the properties under his (respondent's) charge were very
much reduced which does not speak well of his diligence
and attention to the administration of the said properties,"
and that said account failed to report the number of
"offspring of the cattle during the period of accounting
belonging to the estate, thereby indicating a palpable
omission of fact which directly reduced the value of the
income or increase of the assets of the estate." It is
pertinent to emphasize here that the said 1964 account is
still pending approval, hence it was premature to use
alleged defects in said account as grounds for the removal
of the respondent. If it is now ruled that the respondent is
unfit to continue as co-administrator because of the
alleged infirmities in his account for 1964, the respondent
will be greatly prejudiced in the event that said account is
finally approved and the said defects are found to be
nonexistent or so trivial as not to affect the general validity
and veracity of the account. Assuming, however, that the
probate judge correctly observed that the said account
reflects a big reduction in the income of
the haciendas under the separate administration of the
respondent, this fact alone does not justify the conclusion
that the latter did not exercise due care and zeal. There is
no proof that the decrease in income had been caused by
the respondent's willful negligence or dishonesty.
Needless to stress, varied factors, some beyond the control
of an administrator, may cause the diminution of an
estate's income.
Anent the failure to report the number of calves born
during the accounting period, granting that the same is
true, there is however no evidence on record to prove that
the said omission was deliberate or designed to prejudice
the estate. It could have been either an honest mistake or
mere inadvertence. In the absence of competent proof to
the contrary, good faith must be presumed. The probate
judge should have required the respondent to explain the
said omission instead of branding outright said omission
as "palpable."
In his excursion into the records of special proceeding
25876, the probate judge also found a copy of a so-called
"Compliance" submitted by the respondent which reported
"a very staggering amount of over One Million Pesos
supposedly given to the heirs" as advances. The probate
judge proceeded to observe that the "record does not show
that the said advances to the heirs were authorized by the
Court in the amounts made to appear in the 'Compliance.'"
He added that a "verification of the record will show that
may be part of this amount supposedly paid by the co-
administrator to the heirs were authorized by the Court
but a greater volume of the same was obviously not
authorized." On account of this particular finding, the
probate court concluded, without equivocation, that the
respondent had been acting without previous authority
from the probate court. Unfortunately again, the
respondent was not afforded the opportunity to present
his side and if possible to controvert the said finding or
correct the impressions of the judge. Hearing the
respondent on this point is imperative because, like the
other grounds upon which the probate judge anchored the
order of removal, it was not put in issue by the movants,
neither was a copy of said "Compliance" submitted in
Rule 72: Subject Matter and Applicability of General Rules
evidence. It bears emphasis that it there were
unauthorized payments of advances to some heirs or
simulated grants as the probate judge appears to theorize,
then it is most surprising why the prejudiced Matute heirs,
litigation-proned as they are, did not impugn the so-called
"Compliance." Furthermore, not one of the movants
interested in the removal of the respondent specifically
charged the latter with unauthorized or fictitious
payments of advances. It should also be noted that the said
"Compliance" was submitted by the respondent in
response to the probate court's order for the submission of
"a list of the heirs who have personally received the
advances from the administration," not from the
respondent alone. It stands to reason, therefore, that the
said "Compliance" could very well be a cumulative list of all
the advances given and received by the Matute heirs from
the several administrators of the Matute estate since 1955.
In the absence of concrete evidence that the said
"staggering amount" of over a million pesos advances was
disbursed by the respondent alone during his beleaguered
term which commenced only in 1963, we have no recourse
but to jettison the adverse conclusion of the probate judge.
What the probate judge should have done was to afford
Matias the chance to explain and substantiate the facts and
the figures appearing in the aforesaid "Compliance," which
unfortunately does not form part of the record before us.
The respondent asserts that if only the probate judge "took
pains to examine fully the voluminous records of the
Matute estate, and as reflected in the very 'Compliance'
submitted to the Court ... any disbursement given to the
heirs by all the administrators of the Estate were by virtue
of the several Orders of the Probate Court issued upon
joint motion of all the heirs for their monthly maintenance
and support."
It likewise appears that the respondent was removed
partly due to his failure to pay the inheritance and estate
taxes. In this regard, it bears emphasis that the failure to
pay the taxes due from the estate is per se not a compelling
reason for the removal of an administrator, for "it may be
true that the respondent administrator failed to pay all the
taxes due from the estate, but said failure may be due to
lack of funds, and not to a willful omission." 5 In the case at
bar there is no evidence that the non-payment of taxes was
willful. On the contrary, the respondent alleged, and this
was unchallenged by the movants, that while the previous
administrators left the taxes unpaid, he had paid the real
property taxes in Davao covering the years 1954 to 1966.
We now come to the second part of the controverted
order the appointment of the petitioner as co-
administrator vice the respondent. Since the removal of
Matias was done with inordinate haste and without due
process, aside from the fact that the grounds upon which
he was removed have no evidentiary justification, the
same is void, and, consequently, there is no vacancy to
which the petitioner could be appointed.
Even granting arguendo that the removal of Matias is free
from infirmity, this Court is not prepared to sustain the
validity of the appointment of the petitioner in place of the
former. To start with, the record does not disclose that any
hearing was conducted, much less that notices were sent
to the other heirs and interested parties, anent the petition
for the appointment of Jose S. Matute, among others, as co-
administrator vice Matias S. Matute. In this regard, it is
pertinent to observe that any hearing conducted by the
probate court was confined solely to the primary prayers
of the separate petitions of Carlos S. Matute, and the
Candelario-Matute heirs seeking the ouster of Matias S.
Matute. The corollary prayers contained in the same
Page 28
petitions for the appointment of Carlos S. Matute, Jose S.
Matute and Agustina Matute Candelario or anyone of them
as co-administrator were never even considered at any of
the hearings. The requirement of a hearing and the
notification to all known heirs and other interested parties
as to the date thereof is essential to the validity of the
proceeding for the appointment of and administrator "in
order that no person may be deprived of his right or
property without due process of law." (Eusebio vs.
Valmores, 97 Phil. 163) Moreover, a hearing is necessary
in order to fully determine the suitability of the applicant
to the trust, by giving him the opportunity to prove his
qualifications and affording oppositors, if any, to contest
the said application.
The provision of Rule 83 that if "there is no remaining
executor or administrator, administration may be granted
to any suitable person," cannot be used to justify the
institution of Jose S. Matute even without a hearing,
because such institution has no factual basis considering
that there was a general administrator (Carlos V. Matute)
who remained in charge of the affairs of the Matute estate
after the removal of Matias S. Matute. The abovecited
provision evidently envisions a situation when after the
removal of the incumbent administrator no one is left to
administer the estate, thus empowering the probate court,
as a matter of necessity, to name a temporary
administrator (or caretaker), pending the appointment of a
new administrator after due hearing. Such circumstance
does not obtain in the case at bar.
Upon the foregoing disquisition, we hold that the
respondent Court of Appeals was without jurisdiction over
CA-G.R. 37039-R, and that the controverted order of
January 31, 1966 is a nullity and must therefore be set
aside in its entirety.
L-26085
L-26085 is a petition for certiorari with preliminary
injunction interposed on May 19, 1966 by the same
petitioner Jose S. Matute, praying that the controverted
order of default dated April 16, 1966, judgment by default
dated April 23, 1966 and order of execution dated May 3,
1966, all issued by the Court of First Instance of Davao, be
set aside.
The sequence of events, like in L-26751, commenced with
the issuance by the probate court (Court of First Instance
of Manila) of the order of January 31, 1966 removing
Matias S. Matute as co-administrator and replacing him
with Jose S. Matute. Armed with the letters of co-
administration awarded to him on February 3, 1966, Jose
attempted to take possession of and exercise
administration over the five haciendas La Union, Sigaboy,
Monserrat, Colatinan and Pundaguitan, all belonging to the
Matute estate and situated in Governor Generoso, Davao.
Said five haciendas were previously assigned to the
separate administration of the deposed co-administrator,
Matias S. Matute.
Mariano Nasser, herein plaintiff-respondent, who was in
actual possession of the said haciendas, opposed the
projected takeover by the defendant-petitioner Jose S.
Matute in the latter's capacity as co-administrator.
Subsequently, on February 15, 1966, Nasser instituted civil
case 4968 in the Court of First Instance of Davao, a
complain for injunction, alleging that the defendant-
petitioner was forcibly wresting possession of the
said haciendas with the aid of hired goons, and praying
that the said defendant-petitioner be enjoined from taking
Rule 72: Subject Matter and Applicability of General Rules
physical possession, management and administration of
the aforesaid five haciendas. On February 16, 1966 the
court a quo issued a writ of preliminary injunction ex
parte, prohibiting "Jose S. Matute and/or his counsels,
agents, representatives or employees from taking physical
possession, management and administration" of the
abovementioned properties.
On February 23, 1966, seven days after he received on
February 16, 1966, the summons in civil case 4968, the
defendant-petitioner moved to dismiss the aforesaid
complaint for injunction and to dissolve the ex parte writ
of injunction. Said motion to dismiss was predicated
mainly on the contention that the court a quo did not have
jurisdiction over the subject haciendas considering that
the same "are properties in custodia legis under the
jurisdiction of the Probate Court of Manila, in Sp. Proc. No.
25876 since 1955 up to the present time," and
consequently the probate court has exclusive jurisdiction
over all cases, like the one at bar, involving possession and
administration of the aforesaid haciendas. In the same
motion to dismiss, the defendant-petitioner averred that
the alleged contract of lease is simulated and fictitious for
which reason not even a copy of the said contract was
attached to the complaint, and that granting that such a
contract was actually executed, the same is invalid as it
was never approved by the probate court. On February 28,
1966 the defendant-petitioner was furnished a copy of the
plaintiff-respondent's opposition to the abovementioned
motion to dismiss and to lift the ex parte writ of injunction.
Failing to receive any notice of a court resolution on his
client's motion to dismiss during the period of about 1-
months after the filing of the said motion, the defendant-
petitioner's counsel on April 11, 1966 wrote the clerk of
court of the court a quo, requesting that any resolution or
order of the trial court be mailed to him by airmail at his
expense, instead of by surface mail, in order to minimize
postal delay. Sometime between April 11 and 19, 1966, the
said counsel also dispatched an emissary to Davao to
inquire about the status of civil case 4968. After personal
verification of the record, the said emissary reported to the
defendant-petitioner's counsel that the abovementioned
motion to dismiss had been denied by the court a quo in an
order dated March 31, 1966. It was also discovered from
the record that the plaintiff-respondent's counsel had been
sent a copy of the order of denial on the very day it was
rendered (March 31, 1966) but the record was silent as to
the mailing of the corresponding copy for the defendant-
petitioner's counsel, which copy until then had not been
received by the latter. Forthwith, on April 19, 1966,
although he had not yet been furnished his copy of the said
order of denial, defendant-petitioner's counsel interposed
the requisite answer with counterclaim. Then on April 23,
1966 he filed a manifestation calling the attention of the
court a quo that as of the said date he had not received a
copy of the order denying his client's motion to dismiss. It
was only two days later, or on April 25, 1966, that the said
counsel claims, uncontroverted by the respondent Judge
and the plaintiff-respondent, that he received his copy of
the aforesaid order.
In a "Motion to Strike" dated April 26, 1966, the plaintiff-
respondent urged that the aforementioned answer with
counterclaim be stricken from the record on the grounds
that on April 16, 1966 the court a quo had declared
defendant-petitioner in default for failure to answer the
complaint in civil case 4928 and that subsequently,
on April 23, 1966, a judgment by default had been entered
against the latter.
Page 29
 Immediately after receipt on May 5, 1966 of a copy of the
said "Motion to Strike," the defendant-petitioner filed his
opposition, asserting that it was legally impossible to
declare him in default as of April 16, 1966 for failure to file
his responsive pleading, considering that it was only after
the said date, that is, on April 25, 1966, that he received,
through his counsel, a copy of the order denying his
motion to dismiss. On the same day, May 5, 1966, the
defendant-petitioner's counsel dispatched a rush telegram
to the clerk of court of the Court of First Instance of Davao
inquiring whether the trial court had really rendered the
order of default dated April 16, 1966 and the subsequent
judgment by default dated April 23, 1966, copies of which
had not been received by him. On the following day, May 6,
1966, the defendant-petitioner filed an "Urgent Motion to
Investigate the Office of the Clerk of Court for Mailing
Discrepancy."
The defendant-petitioner's counsel claims and this is
not controverted by the respondent Judge and the
plaintiff-respondent that it was only May 17, 1966 that
he received a copy of the judgment by default and at the
same time a copy of the order of execution dated May 3,
1966, and that a copy of the order of default had never
been furnished him.
Because of the impending execution of the judgment by
default with the following dispositive portion
IN VIEW OF ALL THE FOREGOING CONSIDERATIONS,
judgment is hereby rendered in favor of the plaintiff and
against the defendant confirming the right of the plaintiff
to the possession of the premises leased in his favor by the
judicial administrator, Matias S. Matute and the injunction
against the defendant issued in this case is hereby declared
permanent and defendant is hereby permanently enjoined
from interfering in the peaceful possession of the plaintiff
over the haciendas La Union, Sigaboy, Monserrrat,
Golatinan and Pundaguitan of the estate of Amadeo Matute
Olave, all situated in Governor Generoso, Davao and from
doing any act of taking any step against the peaceful
possession of said properties by the plaintiff. The
defendant is likewise ordered to pay the plaintiff the
amount of P50,000.00 as attorney's fees due and payable
to plaintiff's counsel for filing this action: P2,400.00 a
month beginning February, 1966, representing monthly
salaries of security guards employed by the plaintiff in the
haciendas leased plus P7,000.00 representing
transportation hotel and representation expenses incurred
by the plaintiff for plaintiff's counsel and another P700.00
representing the yearly premiums on the injunction bond
filed by plaintiff.
the defendant-petitioner interposed the instant petition
for certiorari with preliminary injunction to annul the
order of default, the judgment by default, and the order of
execution, and to restrain the execution of the aforesaid
judgment pending the resolution of the instant petition.
On May 23, 1966 this Court granted the writ of
preliminary injunction prayed for, conditioned on the
petitioner's posting a bond of P5,000, which he did on June
4, 1966.
We are of the consensus that the herein petition should
be granted.
Rule 11, section 1 of the Revised Rules of Court gives the
defendant a period of fifteen (15) days after service of
summons within which to file his answer and serve a copy
thereof upon the plaintiff, unless a different period is fixed
by the court. However, within the period of time for
Rule 72: Subject Matter and Applicability of General Rules
pleading, the defendant is entitled to move for dismissal of
the action on any of the ground enumerated in Rule 16. If
the motion to dismiss is denied or if determination thereof
is deferred, the movant shall file his answer within the
period prescribed by Rule 11, computed from the time he
received notice of the denial or deferment, unless the court
provides a different period (Rule 16, section 4). In other
words, the period for filing a responsive pleading
commence to run all over again from the time the
defendant received notice of the denial of his motion to
dismiss. 6
Reverting to the case at bar, the defendant-petitioner was
served with summons in connection with civil case 4968
on February 16, 1966, hence he had until March 3, 1966 to
file his responsive pleading. Instead of filing an answer,
he seasonably interposed a motion to dismiss on February
23, 1966. Although the aforesaid motion to dismiss was
denied as early as March 31, 1966, he received notice of
the denial, through his counsel of record, only on April 25,
1966, a fact not traversed by either the respondent Judge
or the plaintiff-respondent. Consequently, the defendant-
petitioner had fifteen (15) days from April 25, 1966, or up
to May 10, 1966, to file his answer.
The delay in the mailing of a copy of the order of denial to
the defendant-petitioner's counsel was confirmed by the
court a quo in a report rendered after an investigation of
the office of the clerk of court upon urgent motion of the
defendant-petitioner. The report reads in part:
From its investigation of the employee in charge of Civil
Cases, the Court found out that, indeed, there was a delay in
the mailing of the Order of this Court dated March 31, 1966
to counsel for the defendant, Atty. Antonio Enril Inton. This
Court, however, is convinced of the sincerity of the reasons
given by the employee concerned, and that is: that her
failure to cause to be mailed the copy intended for Atty.
Antonio Enrile Inton on the same date that she caused to
be mailed the copy for Atty. Paterno Canlas (plaintiff-
respondent's counsel) was purely a case of an honest
mistake and inadvertene on her part owing to the volume
of her work; the affidavit of the employee in charge of Civil
Cases being hereto attached.
The affidavit of the employee concerned mentioned in the
above-quoted portion of the report clearly admits the
delay, thus:
That due to the fact that I am the only one handling
matters relative to Civil Cases and, because of the volume
of my work in the office, I must have inadvertently
misplaced the envelop containing a copy of the Order
intended for Atty. Antonio Enrile Inton, and only
discovered by (my) mistake on April 14, 1966, when I went
over some papers contained in the drawer of my table;
That upon discovery of the said envelope containing the
copy of the order dated March 31, 1966, among the papers
in my table drawer, I forthwith sent the same to the one in
charge of mailing and who mailed the same on April 16,
1966, by registered air mail special delivery, as evidenced
by Registry Receipt No. 26897 now attached to the records
of this case. (emphasis supplied)
It is unmistakable from the foregoing exposition that
when the defendant-petitioner was declared in default on
April 16, 1966 the time for filing his answer had not yet
even commenced to run anew because on the said date his
counsel had not yet received notice of the denial of the
motion to dismiss. The order of denial was received only
on April 25, 1966, or definitely after April 16, 1966, the
Page 30
day when a copy of the said order was mailed to the
defendant-petitioner's counsel and when the defendant-
petitioner was declared in default.
No further elaboration is needed to show that the trial
judge acted in excess of jurisdiction when he declared the
defendant-petitioner in default. Consequently, the herein
controverted order of default is a patent nullity, an
infirmity which likewise afflicts, necessarily, the
subsequent judgment by default and the order of
execution.
It is not amiss to say that, at the very least, the defendant-
petitioner's motion to dismiss should have been
considered as an answer, since it raised issues on the
merits of the case, such as the invalidity of the alleged
contract of lease. Consequently, the defendant petitioner
should have been notified of the hearing, and failure to
give him an opportunity to appear in the court below
tainted the subsequent proceedings not only with
irregularity but also with illegality. It follows, therefore,
that the petitioner was incorrectly declared in default, and
the holding of the trial of the case on the merits in his
absences, without due notice to him, was a denial of due
process. 7
In opposing the instant petition, the plaintiff-respondent
contends that the remedy of the defendant-petitioner is
not a petition for certiorari but an ordinary appeal
pursuant to Rule 41, section 2, paragraph 3 which reads:
A party who has been declared in default may likewise
appeal from the judgment rendered against him as
contrary to the evidence or to the law, even if no petition
for relief to set aside the order of default has been
presented by him in accordance with Rule 38.
We do not agree. The remedy provided for in the
abovequoted rule is properly, though not exclusively,
available to a defendant who has been validly declared in
default. It does not preclude a defendant who has
been illegallydeclared in default from pursuing a more
speedy and efficacious remedy, like a petition
for certiorari to have the judgment by default set aside as a
nullity.
It should be emphasized that a defendant who is properly
declared in default is differently situated from one who is
improvidently declared in default. The former irreparably
loses his right to participate in the trial, while the latter
rentals such right and may exercise the same after having
the order of default and the subsequent judgment be
default annulled and the case remanded to the court of
origin. Moreover the former is limited to the remedy set
forth in section 2, paragraph 3 of Rule 41 by virtue of
which he can contest only the judgment by default on the
designated ground that it is contrary to the evidence or the
law; the latter, however, has the option to avail of the same
remedy or to forthwith interpose a petition
for certiorari seeking the nullification of the order of
default even before the promulgation of a judgment by
default, or in the event that the latter has been rendered, to
have both court decrees the other of default and the
judgment by default declared void. The defendant-
petitioner's choice of the latter course of action is correct
for he controverts the judgment by default not on the
ground that it is not supported by evidence or it is
contrary to law, but on the ground that it is intrinsically
void for having been rendered pursuant to a patently
invalid order of default.
Rule 72: Subject Matter and Applicability of General Rules
Granting, however, that an appeal is open to the
defendant-petitioner, the same is no longer an adequate
and speedy remedy considering that the court a quo had
already ordered the issuance of a writ of execution and the
carrying out of such writ loomed as a great probability.
This is in consonance with the doctrine enunciated in Vda.
de Saludes vs Pajarillo and Bautista 8 wherein this Court
held that an "appeal under the circumstances was not
adequate remedy there being an order of execution issued
by the municipal court." Hence, the rule that certioraridoes
not lie when there is an appeal is relaxed where, as in the
instant case, the trial court had already ordered the
issuance of a writ of execution. 9
The plaintiff-respondent also argues that the instant
petition should be denied for failure of the defendant-
petitioner to move for a reconsideration of the challenged
decrees so as to afford the court a quo the chance to amend
its errors. While as a matter of policy a motion for
reconsideration in the lower court has often been
considered a condition sine qua non for the granting of a
writ of certiorari, this rule does not apply "where the
proceeding in which the error occurred is a patent
nullity," 10 or where "the deprivation of petitioner's
fundamental right to due process ... taints the proceedings
against him in the court below not only with irregularly
but with nullity," 11 or when special circumstances warrant
immediate and more direct action. 12 The fact that the
defendant-petitioner had been deprived of due process,
taken together with the circumstance that a writ of
execution had already been issued, perforce takes this case
outside of the purview of the rule requiring a previous
motion for reconsideration.
The nullity of the challenged orders relieves the
defendant-petitioner from paying the damages assessed
against him by the court a quo; however, it does not entitle
him to pursue further his claim of possession and
administration over the abovementioned five haciendas,
considering that we have declared in L-26751 that his
appointment as co-administrator is void.
In view of the foregoing disquisition, the controverted
order of default, judgment by default and order of
execution should be annulled and set aside.
L-26106
L-26106 is another petition for certiorari with
preliminary injunction instituted on May 25, 1966 by Jose
S. Matute (the same petitioner in L-26751 and L-26085)
and his brother Luis S. Matute, 13 praying for the
nullification of the following orders of the Court of First
Instance of Davao:
1. The order of February 15, 1966 dismissing with
prejudice civil case 4252, a complaint filed by Matias S.
Matute in behalf of the Matute estate for the annulment of
a compromise agreement and for the reconveyance of
certain properties, in which case Jose and Luis Matute
appeared as intervenors in alliance with the plaintiff
estate;
2. The order of March 29, 1966 declaring in default the
intervenors in civil case 4252 for failure to answer the
defendant Paterno Canlas' counterclaim, and adjudging
them to jointly and severally pay the sum of P100,000 in
damages to the said Canlas; and
3. The order of April 12, 1966 directing the issuance of a
writ of execution against the intervenors to enforce the
abovementioned judgment by default.
Page 31
 The factual milieu follows:
On February 5, 1966 Matias S. Matute, in his capacity as
co-administrator, instituted in the name of the Matute
estate civil case 4252 praying for, among others, (1) the
annulment of the compromise agreement dated November
26, 1962 entered into between the co-administrator Julian
V. Matute and Atty. Paterno R. Canlas, one of the
defendants-respondents herein, in full settlement of the
latter's claim for attorney's fees against the decedent
Amadeo Matute Olave; (2) the nullification of the
compromise judgment of December 5, 1962 approving the
aforesaid compromise agreement; (3) the voiding of the
deed of conveyance and assignment of rights dated
December 20, 1962 by virtue of which the said Julian
Matute transferred to Canlas several parcels of land
belonging to the Matute estate pursuant to the
compromise judgment; (4) the annulment of the deed of
conveyance covering the said parcels of land executed on
February 20, 1963 by Canlas in favor of Daniel Rivera, Sr.,
also one of the defendants-respondents; (5) the
nullification of the unregistered deeds of mortgages, both
date July 19, 1963, over said properties executed by Rivera
in favor of Pablo del Rosario and Nicanor Vergara, also
defendants-respondents herein; and (6) the reconveyance
of the said properties.
The aforesaid complaint was anchored on the grounds
that (1) the compromise agreement was entered into in
fraud of the Matute estate; (2) Julian Matute, as a mere co-
administrator, had no authority to enter into the said
compromise agreement without the consent of the then
general administrator, Don Celestino Alonzo; (3) the
compromise agreement was approved by the Court of First
Instance of Manila (Branch X) without notice to the heirs
and the general administrator; and (4) the said agreement
had neither prior nor subsequent approval of the probate
court which has custody of the parcels of land involved in
the said agreement.
The defendant-respondent Canlas subsequently
interposed a motion to dismiss dated February 24, 1964
predicated on the ground of res judicata, among others.
Anent the issue of res judicata, said motion to dismiss
averred:
The records of Civil Case No. 14208, entitled "Rosario
Matute, et al. v. Amadeo Matute Olave", Court of First
Instance of Manila, Branch X, will show that on December
5, 1962, the Honorable Judge Jose L. Moya, Presiding Judge
of Branch X, of the Court of First Instance of Manila,
rendered a Compromise Judgment ... pursuant to a
Compromise Agreement ... entered into between defendant
Paterno R. Canlas and the Estate of Amadeo Matute Olave,
duly represented by the General Administrator of the
Estate, the late Julian V. Matute and his counsel of record in
said Civil Case No. 14208, Atty. Marcelo Rafols Javier
involving the attorney's fees of defendant Paterno R.
Canlas in said Civil Case No. 14208, secured with a
charging lien on the properties involves herein. Pursuant
to said Compromise Judgment, the said Julian V. Matute, as
General Administrator of the Estate of his deceased father,
Amadeo Matute Olave, transferred and conveyed the
properties involved herein which were ordered to be sold
by the Probate Court of Manila for only P144,000.00, in
favor of defendant Paterno R. Canlas as full payment of his
attorney's fees in Civil Case No. 14208 in the amount of
P200,000.00 agreed upon in the Compromise Agreement.
The said Compromise Judgment of December 5, 1962 is
immediately final and not appeallable and has the effect
and authority of Res Judicata in this case filed by co-
Rule 72: Subject Matter and Applicability of General Rules
administrator, Matias S. Matute, on behalf of the Estate,
without authority of his general administrator, Carlos V.
Matute, who filed a Motion to Dismiss the complaint in this
case
That the records of Civil Case No. 14208 will show that
after the Compromise Judgment was rendered on
December 5, 1962, a Petition for relief to set aside the said
Compromise Judgment was filed by two (2) of the heirs
and full-blooded sisters of plaintiff co-administrator,
Matias S. Matute, namely, Rosario and Trinidad Suazo
Matute on June 6, 1963, on grounds of (a) fraud and (b)
lack of the probate court's approval to the Compromise
Agreement, the very same grounds alleged in the present
Complaint of plaintiff Estate, a copy of the Petition for
Relief is hereto attached as Annex "C" of this Motion to
Dismiss. That on June 13, 1963, herein defendant Paterno
R. Canlas filed his Opposition to petition for Relief, and, on
June 26, 1963, a Supplementary Opposition to Petition for
Relief and refuting all the above issues raised in the
Petition for Relief, copies of which are hereto attached as
Annexes "D" and "E". Rosario and Trinidad Suazo Matute
filed Reply and defendant Paterno R. Canlas filed his
Rejoinder on July 8, 1963 attaching therewith the letter-
conformity to the Compromise Judgment of co-
administrator, Matias S. Matute, copies of which are hereto
attached as Annexes "F" and "F-1" of this Motion to
Dismiss. That on July 13, 1963, Branch X of the Court of
First Instance of Manila, taking cognizance of Civil Case No.
14208, rightfully denied the Petition for Relief on all the
grounds stated in our Opposition to the Petition for Relief,
Supplementary Opposition, etc., and Rejoinder, a copy of
which order is hereto attached as Annex "G" of this Motion
to Dismiss.
In other words, it is the basic contention of Canlas that
both the compromise judgment of December 5,
1962rendered by the Court of First Instance of Manila
(Branch X) 14 and the order of the same court dated July 13,
1963 denying the aforecited petition for relief from
judgment which sought the setting aside of the said
compromise judgment, bar by virtue of res judicata the
prosecution of the abovementioned civil case 4252 which
seeks anew the annulment of the said compromise
judgment on practically the same grounds invoked in the
aforesaid petition for relief, which grounds were justifiably
denied by the competent court.
It appears that on the same day Canlas filed his motion to
dismiss, the general administrator and heir, Carlos V.
Matute, filed his own motion to dismiss dated February 15,
1964, stating among other things, that he had never
authorized his co-administrator, Matias Matute, to file civil
case 4252 in the name of the estate and that said
complaint was filed without legal authority and is
prejudicial to the interests of the estate as it would only
entail unnecessary litigation expenses. He presented his
written conformity to the compromise judgment in his
capacity as the succeeding general administrator.
On February 27, 1964 the defendants-respondents Daniel
Rivera, Sr., Pablo del Rosario and Nicanor Vergara filed
their own joint motion to dismiss, alleging among other
things that they were innocent transferees and mortgages
for value of the properties subject matter of the complaint
and adopted as their own the motions to dismiss filed by
Canlas and Carlos V. Matute.
Page 32
 On April 11, 1964 the Honorable Judge Vicente N. Cusi, Jr.,
executive judge of the Court of First Instance of Davao,
issued an order deferring to after the trial the final hearing
and determination of the motions to dismiss since the
grounds alleged therein "do not appear to be indubitable."
From this order, the defendants moved for a
reconsideration which was denied on January 16, 1965.
Meanwhile, on August 17, 1964 Jose and Luis Matute filed
a motion to intervene, asking that they be allowed to adopt
the complaint of the plaintiff-estate. Said motion was
granted on September 5, 1964.
After the aforesaid rejection of the defendants' motion for
reconsideration of the order denying their separate
motions to dismiss, Canlas filed on February 15, 1965 his
answer ad cautelam, traversing the material allegations of
the complaint in civil case 4252 and interposing the
grounds stated in his motion to dismiss as affirmative
defenses. He also filed a counterclaim for damages in the
amount of P100,000 jointly against Matias Matute, for
filing the "frivolous and unfounded" action in the name of
the estate, and Jose an Luis Matute, for intervening in the
case. All there were charged in their personal capacities.
On the same date, the other defendants, Rivera, del Rosario
and Vergara, filed their own answer ad cautelam, denying
the essential averments of the complaint having relevance
to them and adopting the affirmative defenses interposed
by Canlas. Said defendants similarly interposed a
counterclaim of P50,000 for damages, directed against the
plaintiff-estate.
On March 1, 1965 Matias Matute, representing the
plaintiff-estate, filed the corresponding answers to the
foregoing counterclaims. The answer to Canlas'
counterclaim specifically denied.
that the above-entitled case is patently frivolous and
unfounded and was instituted in bad faith and calculated
to merely harass the defendant in order to satisfy the
personal revenge, hatred and vindictiveness of the co-
administrator Matias S. Matute, representing the plaintiff
estate, and intervenors Jose S. Matute and Luis S. Matute,
the truth being that the complaint in the above-entitled
case was instituted precisely to prevent defendants from
illegally and fraudulently transforming and conveying
themselves valuable properties of plaintiff estate worth
more than P500,000.00;
and disclaimed any
knowledge of any actual, moral and consequential
damage having been suffered by defendant Paterno R.
Canlas.
Meanwhile, upon motion of the counsels for the
defendants, Judge Cusi ordered on August 28, 1965 the
reshuffle of civil case 4252 in accordance with section 7,
Rule 22 of the Rules of Court. Eventually, the case was
transferred to the sala of Judge Vicente P. Bullecer, the
respondent judge herein.
On January 22, 1966 Canlas filed a "Motion to Resolve: I.
Motion to Dismiss; II. Supplementary and/or Second
Motion to Dismiss."
On February 3, 1966 Jose Matute interposed an urgent ex
parte motion for substitution as representative of the
plaintiff-estate in place of Matias Matute, citing the order
of January 31, 1966 of the probate court of Manila which
appointed him as co-administrator in place of Matias
Matute.
Rule 72: Subject Matter and Applicability of General Rules
Subsequently, Matias Matute filed in behalf of the
plaintiff-estate a motion to withdraw and/or dismiss with
prejudice the complaint in civil case 4252, which, it will be
recalled, he himself instituted in the name of the Matute
estate. The following grounds were advanced to justify the
said motion:
That after a thorough study of the documents presented
by the parties in this case, the undersigned Judicial
Administrator realized that he has expressly ratified and
confirmed any and all contracts and compromise for
attorney's fees that his co-administrator Julian V. Matute
has already entered into with the defendant Atty. Paterno
R. Canlas in his capacity as co-administrator of the said
testacy;
That the causes of action of the above-entitled complaint
against the defendants were based and predicated from
the compromise agreement entered into between
co-administrator Julian V. Matute and the defendant
Paterno R. Canlas on December 2, 1962 and which
compromise agreement was approved by Judge Jose Moya,
presiding Judge of Branch X of the Court of First Instance
of Manila, in Civil Case No. 14208 entitled Rosario S.
Matute, et al. vs. Amadeo Matute Olave, etc., in the
Compromise Judgment dated December 5, 1962.
On February 15, 1966 the respondent Judge dismissed
with prejudice the aforesaid complaint. The order of
dismissal reads:
The records show that this action was filed by Matias S.
Matute in his capacity as co-administrator of the Estate of
Amadeo Matute Olave appointed in Sp. Proc. No. 25876,
Probate Court of Manila, to annul a compromise judgment
awarding attorney's fees to defendant Atty. Paterno R.
Canlas and rendered in Civil Case No. 14208, Court of First
Instance of Manila.
Pending incidents in this case, are the motion to dismiss
and supplementary motion to dismiss on the ground of res
judicata filed by the defendants and adopted by the
General Administrator of the Estate, Carlos V. Matute, and
the heirs Maria Luisa Matute, Conchita V. Matute, Carlos S.
Matute, Ramos S. Matute, Eduarda S. Matute and Mrs.
Cecilia Villanueva Matute.
It appears now that the co-administrator Matias S. Matute
who filed this action in the name of the Estate of Don
Amadeo Matute Olave filed a motion to withdraw and/or
dismiss dated January 8, 1966 and verified before the
acting Clerk of Court of Appeals stating that he is
withdrawing the complaint he filed in this case and prays
this Court to dismiss it with prejudice and further ratifying
and expressing conformity to the compromise judgment
subject matter of the complaint rendered in the Civil Case
14208, Court of First Instance of Manila.
As prayed for in defendants' motion to dismiss and
supplementary action (motion) to dismiss, the action filed in
this case is hereby dismissed with prejudice without cost to
plaintiff . (emphasis supplied).
On March 12, 1966 the respondent Judge issued another
order declaring that "all the other incidents pending in this
case are hereby terminated and closed." (Emphasis
supplied) Said order reads:
Considering the order of this Court dated February 15,
1966 dismissing this case with prejudice on the ground
of res judicata in view of the final order of July 31, 1963
issued by the Court of First Instance of Manila, Branch X, in
Page 33
Civil Case No. 14208, as alleged in the defendants' motion
to dismiss and supplementary motion to dismiss: and
considering further that the co-administrator Matias S.
Matute who filed the complaint in this case in the name of
the plaintiff Estate has withdrawn and/or prayed for the
dismissal of this case with prejudice, and considering
furthermore, that the said Order of this Court of February
15, 1966 is now fixed and final, all the other incidents
pending in this case are hereby terminated and closed.
However, on March 29, 1966 the respondent Judge
promulgated an order declaring in default both the
intervenors and the plaintiff estate, the former for failure
to answer Canlas' counterclaim and the latter for failure to
respond to the other defendants' separate counterclaim.
The same decree included a judgment by default
condemning the intervenors to jointly and severally pay
the sum of P100,000 as damages to Canlas and likewise
sentencing the plaintiff estate to indemnify the other
defendants Rivera, del Rosario and Vergara in the sum of
P50,000. Subsequently, on April 12, 1966 the respondent
Judge ordered the issuance of a writ of execution to
enforce the aforesaid judgment by default.
Hence, the interposition by the intervenors of the instant
petition for certiorari with preliminary injunction.
Anent the order of February 15, 1966 dismissing with
prejudice civil case 4252, the intervenors-petitioners (now
Jose Matute alone, as the other petitioner, Luis Matute, has
already withdrawn) contend that the said order is a nullity
as it was predicated on a void motion to dismiss and/or
withdraw filed by Matias Matute on February 14, 1966,
two weeks after the latter had been removed as co-
administrator by the probate court in an order dated
January 31, 1966. It is further maintained that when
Matias Matute interposed the aforesaid motion to dismiss
and/or to withdraw, he had no more authority to
represent the Matute estate as a consequence of his ouster
as co-administrator. The foregoing argument is
irredeemably foreclosed by our explicit ruling in L-26751
setting aside the abovementioned order of January 31,
1966 and declaring as void the removal of Matias Matute
and the appointment of the herein intervenor-petitioner
Jose S. Matute as the new co-administrator. Granting,
therefore, that the controverted order of dismissal was
rendered on account of Matias Matute's aforesaid motion
which was filed in behalf of the plaintiff estate, the validity
of such dismissal order cannot be challenged on the
ground that the movant (Matias Matute) lacked the
capacity to represent the plaintiff estate considering that
his personality and authority as co-administrator
remained unimpaired because the order of January 31,
1966 is a nullity.
However, the intervenor-petitioner is of the mistaken
impression that the disputed order of dismissal was based
on Matias Matute's motion to dismiss and/or to withdraw.
As correctly pointed out by the defendants-respondents,
the said order was anchored on their own motion to
dismiss and supplementary motion to dismiss. Although
both the motions of the co-administrator in representation
of the plaintiff estate and of the defendants, either of which
could justify the dismissal of the complaint in civil case
4252, were prominently mentioned in the body of the said
controverted order, the unequivocal import of the
dispositive portion of said decree, however, is that the
dismissal was predicated on the defendants' motion to
dismiss and supplementary motion to dismiss, thus:
Rule 72: Subject Matter and Applicability of General Rules
As prayed for in defendants' motion to dismiss and
supplementary action to dismiss, the action filed in this case
is hereby dismissed with prejudice without cost to
plaintiff. (emphasis supplied)
Moreover, both the order of March 12, 1966 declaring the
termination of all other incidents in civil case 4252 and the
order of April 11, 1966 denying the intervenors' motion
for reconsideration, categorically affirm that the disputed
order of dismissal was anchored on the defendants'
motion to dismiss on the ground of res judicata. The order
of April 11, 1966 specifically declares that the dismissal of
civil case 4252 was based
... on the ground of res judicata invoked by the defendants
in their Motion to Dismiss and Supplementary Motion to
Dismiss for the reason that the Compromise Judgment
rendered in Civil Case No. 14208, Court of First Instance of
Manila, sought to be annulled in this case, and the Order of
July 31, 1963 denying the Petition for Relief in Civil Case
No. 14208 and settling all the issues raised in the
Complaint, have both the force and effect of res judicata.
Undeniably, the aforesaid order of dismissal with
prejudice adjudicated civil case 4252 upon the merits.
Since there is no showing that the respondent Judge issued
the said order with grave abuse of discretion or without or
in excess of jurisdiction, an ordinary appeal, then, not a
petition for certiorari, was the proper remedy available to
the intervenors Jose and Luis Matute who claim to be
aggrieved, by the dismissal. But having failed to seasonably
appeal from the aforesaid order of dismissal, the herein
intervenor-petitioner cannot avail of a petition
for certiorari as a substitute remedy 15 to challenge the said
order, which in the meantime had already become final.
The pretention of the intervenor-petitioner that his
inability to appeal on time was due to the failure of the
court a quo to furnish him a copy of the order of dismissal
is a spurious, if not an utterly perfidious, claim. To begin
with, when the herein intervenor-petitioner and his
brother Luis filed their motion to intervene on August 17,
1964, they were not represented by counsel, but they
failed to disclose their respective addresses or at least the
address of one of them, contrary to the requirement of
section 5 of Rule 7 that a "party who is not represented by
an attorney shall sign his pleadings and state his address."
(emphasis supplied) Consequently, if the pertinent orders
and notices were not sent to the intervenors, it was
because of their failure to disclose their mailing addresses.
At all events, since the intervenors virtually allied with the
plaintiff estate by adopting in toto the latter's complaint
without filing a separate complaint in intervention, it is not
without justification to rule, considering the particular
circumstances obtaining, that notice to the plaintiff estate
should be deemed sufficient notice to the intervenors.
Moreover, it is of record that both Attys. Wenceslao
Laureta and Robert Porter, who appeared on February 7,
1966 as counsels for the intervenor Jose S. Matute in his
capacity as alleged co-administrator by virtue of the
abovecited order of the probate court dated January 31,
1966, were duly furnished with copies of all orders of the
court a quo subsequent to their appearance. Anent the
order of dismissal dated February 15, 1966, the lower
court reported, after an investigation of the deputy clerk of
court for alleged mailing discrepancies upon motion of the
intervenors, that copies of the said order were "each
mailed to and received by Attys. Wenceslao Laureta and
Robert E. Porter on March 18 and 3, 1966, respectively,
per registry return cards duly attached to the records of
this case." In other words, the intervenor-petitioner Jose S.
Page 34
Matute was furnished, through counsel, a copy of the order
of dismissal at the earliest on March 3, 1966 when Atty.
Porter received a copy of the order. After a lapse of twenty-
three (23) days from the receipt of the said copy, Attys.
Laureta and Porter filed on March 26, 1966 a motion for
reconsideration of the order of dismissal. Hence, when the
said motion was filed, the intervenor-petitioner had
still seven (7) days to perfect an appeal. Subsequently, on
April 11, 1966, the court a quo denied the aforesaid motion
for reconsideration. Separate copies of said denial were
received by Atty. Laureta on April 16, 1966 and by Atty.
Porter on April 18, 1966, respectively, as per registry
receipts 25870 and 25872 and delivery No. 69785 and the
reply-telegram dated July 2, 1966 from the Bureau of Posts
addressed to the respondent Judge. From April 16, 1966,
the intervenor-petitioner still had seven (7) days or up
to April 23, 1966 to perfect an appeal. However, it was only
on April 25, 1966 that the requisite notice of appeal and
appeal bond were filed while the record on appeal was
filed much later, on May 26, 1966, clearly way beyond the
reglementary period.
The intervenor-petitioner contends, however, that it was
only on April 25, 1966 that he received notice of the
dismissal of civil case 4252 and on the very same day he
caused the filing of the necessary notice of appeal and
appeal bond. Conceding that the foregoing assertion is
correct, the intervenor-petitioner's projected appeal was
still out of time since the requisite record on appeal was
filed only on May 26, 1966, or thirty-one days from April
25, 1966.
In passing, it is pertinent to note that the dismissal of the
complaint in civil case 4252m, after the issues were joined
with the filing of the responsive pleadings, upon the
defendants' motion to resolve a pending motion to dismiss,
the resolution of which had been previously deferred until
after the trial by virtue of an order of the same court under
another judge, is a procedural deviation from the standard
sequence of trial in accordance with which the court a quo,
after the requisite answers were filed, should have
proceeded with the trial on the merits, and only thereafter
resolved the motion to dismiss as was the import of the
order of defendant. Nevertheless, it is relevant to
emphasize, on the other hand, that an order deferring the
resolution of a motion to dismiss, being an interlocutory
order, may be altered or revoked by the trial court during
the pendency of the main action. It is settled that an
"interlocutory order or decree made in the progress of a
case is always under the control of the court until the final
decision of the suit, and may be modified or rescinded
upon sufficient grounds shown at any time before final
judgment...." 16 Of similar import is the ruling of this Court
declaring that "it is rudimentary that such (interlocutory)
orders are subject to change in the discretion of the
court. 17 Moreover, one of the inherent powers of the court
is "To amend and control its process and orders so as to
make them conformable to law and justice." 18 In the
language of Chief Justice Moran, paraphrasing the ruling
in Veluz vs. Justice of the Peace of Sariaya, 19 "since judges
are human, susceptible to mistakes, and are bound to
administer justice in accordance with law, they are given
the inherent power of amending their orders or judgments
so as to make them conformable to law and justice, and
they can do so before they los their jurisdiction of the case
that is before the time to appeal has expired and no appeal
has been perfected." 20 And in the abovecited Veluz case,
this Court held that "If the trial court should discover or be
convinced that it had committed an error in its judgment,
or had done an injustice, before the same has become final,
it may, upon its own motion or upon a motion of the
Rule 72: Subject Matter and Applicability of General Rules
parties, correct such error in order to do justice between
the parties.... It would seem to be the very height of
absurdity to prohibit a trial judge from correcting an error,
mistake, or injustice which is called to his attention before
he has lost control of his judgment." Corollarily, it has also
been held "that a judge of first instance is not legally
prevented from revoking the interlocutory order of
another judge in the very litigation subsequently assigned
to him for judicial action." 21
In view of the foregoing rulings, it is then enough to say
that the abovementioned order of deferment, issued by the
Honorable Judge Vicente Cusi, Jr., to whose sala civil case
4252 was originally assigned, is interlocutory in nature,
and as such, the court a quo, through the now respondent
Judge Vicente Bullecer, had the power to set it aside, as it
did by finally deciding the pending motion to dismiss on
the ground of res judicata. Moreover, as previously stated,
there is no evidence to show that the respondent Judge, in
issuing the order of dismissal, acted with grave abuse of
discretion or without or in excess of jurisdiction.
We now come to the challenged order of default and
judgment by default, both contained in the
abovementioned order dated March 29, 1966. Attacking
the validity of the said order of default, the intervenor-
petitioner claims that the respondent Judge failed to
consider that Matias Matute, representing the plaintiff
estate, filed on time an answer dated March 1, 1965
traversing the allegations of Canlas' counterclaim, which
answer inured to the benefit of not only Matias Matute but
also to the intervenors who were jointly impleaded as
defendants in the said counterclaim. The defendant-
respondent Canlas, on the other hand, while not denying
receipt of the aforesaid answer to his counterclaim,
contends that the herein intervenor-petitioner's failure to
personally answer said counterclaim is fatal and that he
could not take refuge under the answer interposed by
Matias Matute.
We are of the considered opinion that the herein disputed
order of default is illegal and void, and, consequently, the
controverted judgment by default and order of execution
were improvidently issued.
1. The counterclaim interposed by Canlas raised a
common cause of action for damages against Matias
Matute, as the representative of the plaintiff estate, and
Jose and Luis Matute, as intervenors in civil case 4252, all
in their personal capacities. The counterclaim reads:
That for instituting this patently frivolous and unfounded
action in bad faith calculated to merely harass answering
defendant Paterno R. Canlas in order to satisfy the
personal revenge, hatred and vindictiveness of the co-
administrator, Matias S. Matute, representing the plaintiff
Estate, and the intervenors Jose S. Matute and Luis S.
Matute, defendant Paterno R. Canlas suffered actual, moral
and consequential damages in the total amount of
P100,000.00, for which plaintiff Matias S. Matute and
intervenors Jose S. Matute and Luis S. Matute should be held
personally liable. (emphasis supplied)
Having been this jointly charged to pay the abovestated
damages, the brothers Matias, Jose and Luis Matute could
validly file a common responsive pleading, as in effect they
did when Matias Matute filed an answer to the aforesaid
counterclaim, the receipt of which Canlas admits. It is
significant to note that the said answer does not only deny
the charge against Matias Matute but as well as negates the
claim against the intervenors.
Page 35
 2. Moreover, having successfully prayed for the resolution
of his pending motion to dismiss, even after the issues had
been joined with the filing of his answer, the defendant-
respondent Canlas is deemed to have abandoned his
counterclaim and voluntarily reverted himself to the time
when he initially interposed his motion to dismiss prior to
the filing of his answer with counterclaim. Thus, when the
complaint in civil case 4252 was dismissed on the basis of
Canlas' motion, the entire proceeding was inevitably
terminated and there was nothing more to adjudge. In fact,
the termination of all the pending incidents in civil case
4252 was subsequently decreed by the respondent Judge
himself in the orders of March 12, 1966 and April 11, 1966.
Consequently, the respondent Judge, to say the least, acted
in excess of jurisdiction when he issued, after having
dismissed the principal complaint, the herein controverted
order of default and judgment by default for then there
was nothing left to be adjudicated. Said decrees having
been rendered in excess of jurisdiction, certiorari will lie to
have then annulled.
In view of the foregoing discussion, the finality of the
order of dismissal should be upheld, while the disputed
order of default, judgment by default and order of
execution should be declared void and set aside.
The motion interposed on June 14, 1966 by the herein
intervenor-petitioner, in his alleged capacity as co-
administrator, in behalf of the Amadeo Matute Olave
estate, praying that the said estate be allowed to adopt the
instant petition for certiorari with preliminary injunction
and be admitted as co-petitioner, the resolution of which
we had previously deferred, should therefore be denied on
the ground that the intervenor-petitioner has no legal
personality to represent the Matute estate considering that
his appointment as co-administrator has been voided.
Nevertheless, it is our considered view that the declaration
of total nullity of the abovementioned judgment by default
shall perforce bar the execution against the Matute estate
of that portion of the said void judgment which condemns
it to pay the sum of P50,000 in damages to the defendants-
respondents Rivera, del Rosario and Vergara.
ACCORDINGLY, (1) in L-26751 the petition for certiorari is
hereby granted; the respondent Court of Appeals is
adjudged as without jurisdiction over CA-G.R. 37039-R; the
probate court's controverted order of January 31, 1966 is
hereby set aside in its entirety, thereby maintaining the
respondent Matias S. Matute in his trust as co-
administrator of the Amadeo Matute Olave estate; (2) in L-
26085 the petition for certiorari is hereby granted; the
order of default dated April 16, 1966, the judgment by
default dated April 23, 1966, and the order of execution
dated May 3, 1966, all issued in excess of jurisdiction by
the respondent Judge of the Court of First Instance of
Davao, are set aside; and (3) in L-26106 the petition
for certiorari is hereby denied in so far as it seeks to nullify
the final order of dismissal dated February 15, 1966; the
order of default and judgment by default dated March 29,
1966 and the order of execution dated April 12, 1966, all
similarly issued in excess of jurisdiction by the same
respondent Judge are set aside. No pronouncement as to
costs.
G.R. No. 172547 June 30, 2009
PRECY BUNYI and MILA BUNYI, Petitioners,
vs.
FE S. FACTOR, Respondent.
DECISION
Rule 72: Subject Matter and Applicability of General Rules
QUISUMBING, J.:
For review on certiorari are the Decision1 dated January
16, 2006 and Resolution2 dated April 26, 2006 of the Court
of Appeals in CA-G.R. SP No. 90397, which had affirmed the
Decision3 dated March 7, 2005 of the Regional Trial Court
(RTC) of Las Pias City, Branch 198 in Civil Case No. LP-04-
0160.
The antecedent facts are as follows:
Respondent Fe S. Factor is one of the co-owners of an 18-
hectare piece of land located in Almanza, Las Pias City.
The ownership of the land originated from respondents
paternal grandparents Constantino Factor and Maura
Mayuga-Factor who had been in actual, continuous,
peaceful, public, adverse and exclusive possession and
occupation of the land even before 1906.4
On December 9, 1975, the children of Constantino Factor
and Maura Mayuga-Factor filed a Petition for Original
Registration and Confirmation of Imperfect Title to the
said parcel of land, or Lots 1, 2, 3 and 4 of Psu-253567,
before the RTC of Pasig City, Branch 71.5 On December 8,
1994, the trial court granted the petition in LRC Case No.
N-9049 and declared the children of Constantino Factor
and Maura Mayuga-Factor as co-owners of the
property. 6 The children of Constantino Factor and Maura
Mayuga-Factor thereafter sold seven (7) hectares of the
Factor family property during the same year. The siblings,
except Enrique Factor, respondents father, shared and
divided the proceeds of the sale among themselves, with
the agreement that Enrique would have as his share the
portion of the property located in Antioch Street, Pilar
Executive Village, Almanza I, Las Pias City, known as the
Factor compound.
Following his acquisition thereof, Enrique caused the
construction of several houses in the compound including
the subject property, a rest house, where members of the
Factor family stayed during get-togethers and
visits.7Petitioners Precy Bunyi and her mother, Mila Bunyi,
were tenants in one of the houses inside the compound,
particularly in No. 8 Antioch St., Pilar Village, Almanza, Las
Pias City since 1999.8
When Enrique Factor died on August 7, 1993, the
administration of the Factor compound including the
subject rest house and other residential houses for lease
was transferred and entrusted to Enriques eldest child,
Gloria Factor-Labao.
Gloria Factor-Labao, together with her husband Ruben
Labao and their son Reggie F. Labao, lived in Tipaz, Taguig,
Metro Manila but visited and sometimes stayed in the rest
house because Gloria collected the rentals of the
residential houses and oversaw the Factor compound.
When Gloria died on January 15, 2001, the administration
and management of the Factor compound including the
subject rest house, passed on to respondent Fe S. Factor as
co-owner of the property. As an act of goodwill and
compassion, considering that Ruben Labao was sickly and
had no means of income, respondent allowed him to stay
at the rest house for brief, transient and intermittent visits
as a guest of the Factor family.
On May 31, 2002, Ruben Labao married petitioner Precy
Bunyi. On November 10, 2002, Ruben Labao died.
At about this time, respondent discovered that petitioners
forcibly opened the doors of the rest house and stole all
the personal properties owned by the Factor family and
Page 36
then audaciously occupied the premises. Respondent
alleged that petitioners unlawfully deprived her and the
Factor family of the subject propertys lawful use and
possession. Respondent also added that when she tried to
enter the rest house on December 1, 2002, an unidentified
person who claimed to have been authorized by
petitioners to occupy the premises, barred, threatened and
chased her with a jungle bolo. Thus, on September 12,
2003, respondent Fe S. Factor filed a complaint9 for
forcible entry against herein petitioners Precy Bunyi and
Mila Bunyi.
Petitioners, for their part, questioned Fes claim of
ownership of the subject property and the alleged prior
ownership of her father Enrique Factor. They asserted that
the subject property was owned by Ruben Labao, and that
petitioner Precy with her husband moved into the subject
property, while petitioner Mila Bunyi, mother of Precy,
remained in No. 8 Antioch St.
On July 13, 2004, the Metropolitan Trial Court (MeTC) of
Las Pias City, Branch 79 ruled in favor of Fe S. Factor. The
dispositive portion of the decision reads:
WHEREFORE, judgment is hereby rendered in favor of the
plaintiff and against the defendants ordering the latter and
all persons claiming rights under them to:
1. To immediately vacate the subject premises and
surrender possession thereof to the plaintiff.
2. To pay the monthly rental of P2,000.00 from December
1, 2002 up to the time they finally vacate the premises.
3. To pay attorneys fee of Php 10,000.00.
The counter-claim is dismissed for lack of merit.
SO ORDERED.10
Petitioners appealed the decision to the RTC of Las Pias
City, Branch 198, which, however, affirmed in toto the
decision of the MeTC and later denied their motion for
reconsideration.11 Undaunted, petitioners filed a petition
for review before the Court of Appeals but it was denied
also. Hence, the instant petition before us.
Petitioners submit the following issues for the Courts
consideration:
I.
[WHETHER] THE HONORABLE COURT OF APPEALS
SERIOUSLY ERRED IN LAW AND JURISPRUDENCE WHEN
IT AFFIRMED THE DECISION OF THE REGIONAL TRIAL
COURT THAT FORCE, THREAT, INTIMIDATION AND
STEALTH HAD BEEN COMMITTED BY THE PETITIONERS
IN OCCUPYING THE SUBJECT RESIDENTIAL HOUSE;
II.
[WHETHER] THE HONORABLE COURT OF APPEALS
SERIOUSLY ERRED WHEN IT MISAPPRECIATED THE FACT
THAT THE RESPONDENT HAS A BETTER RIGHT OF
PHYSICAL AND MATERIAL POSSESSION OF THE SUBJECT
PROPERTY;
III.
[WHETHER] THE HONORABLE COURT OF APPEALS
SERIOUSLY ERRED IN AFFIRMING THE FINDING OF THE
REGIONAL [TRIAL] COURT HOLDING PETITIONERS
LIABLE TO PAY THE MONTHLY RENTAL OF P2,000.00
Rule 72: Subject Matter and Applicability of General Rules
FROM DECEMBER 1, 2002 UP TO THE TIME THEY
FINALLY VACATE PREMISES.12
The resolution of the first issue raised by petitioners
requires us to inquire into the sufficiency of the evidence
presented below, a course of action which this Court will
not do, consistent with our repeated holding that the
Supreme Court is not a trier of facts.13 The resolution of
factual issues is the function of lower courts, whose
findings on these matters are received with respect and
considered binding by the Supreme Court subject only to
certain exceptions, none of which is present in the instant
petition.14 Noteworthy, in this case, the cited findings of
the RTC have been affirmed by the Court of Appeals.
As to the second issue, the resolution thereof boils down to
a determination of who, between petitioners and
respondent, would be entitled to the physical possession of
the subject property.
Both parties anchor their right of material possession of
the disputed property on their respective claims of
ownership. Petitioners insist that petitioner Precy has a
better right of possession over the subject property since
she inherited the subject property as the surviving spouse
and sole heir of Ruben Labao, who owned the property
before his death.
Respondent, on the other hand, hinges her claim of
possession on the fact that her predecessor-in-interest had
prior possession of the property as early as 1975.
After careful consideration, we find in favor of the
respondent.
In ejectment cases, the only issue for resolution is who is
entitled to the physical or material possession of the
property involved, independent of any claim of ownership
set forth by any of the party-litigants. The one who can
prove prior possession de facto may recover such
possession even from the owner himself.15 Possession de
facto is the physical possession of real property.
Possession de facto and not possession de jure is the only
issue in a forcible entry case.16 This rule holds true
regardless of the character of a partys possession,
provided, that he has in his favor priority of time which
entitles him to stay on the property until he is lawfully
ejected by a person having a better right by either accion
publiciana or accion reivindicatoria.17
Petitioners argue that respondent was never in possession
of the subject property since the latter never occupied the
same. They claim that they have been in actual possession
of the disputed property from the time petitioner Precy
married Ruben Labao in 2002.
In this instance, however, petitioners contention is
unconvincing.
For one to be considered in possession, one need not have
actual or physical occupation of every square inch of the
property at all times.18 Possession can be acquired not only
by material occupation, but also by the fact that a thing is
subject to the action of ones will or by the proper acts and
legal formalities established for acquiring such
right.19 Possession can be acquired by juridical acts. These
are acts to which the law gives the force of acts of
possession. Examples of these are donations, succession,
execution and registration of public instruments, and the
inscription of possessory information titles.20
Page 37
While petitioners claim that respondent never physically
occupied the subject property, they failed to prove that
they had prior possession of the subject property. On
record, petitioner Precy Bunyi admitted that Gloria Factor-
Labao and Ruben Labao, as spouses, resided in Tipaz,
Taguig, Metro Manila and used the subject property
whenever they visit the same.21 Likewise, as pointed out by
the MeTC and the RTC, Ruben and petitioner Precys
marriage certificate revealed that at the time of their
marriage, Ruben was residing at 123 A. Lake St., San Juan,
Metro Manila. Even Rubens death certificate showed that
his place of death and residence was at #4 Labao St., Tipaz,
Taguig, Metro Manila. Considering that her husband was
never a resident of the subject property, petitioner Precy
failed to explain convincingly how she was able to move in
with Ruben Labao in the subject property during their
marriage.
On the other hand, it was established that respondents
grandparents, Constantino Factor and Maura Mayuga-
Factor, had been the occupants and in possession of
various agricultural parcel of lands situated in Almanza,
Las Pias City, in the concept of owners, for more than
thirty years prior to 1975. In fact, the RTC in its Decision
dated December 8, 1994 in LRC Case No. N-9049 has
confirmed the rights of respondents predecessors over the
subject property and ordered the issuance of the
corresponding certificate of title in their favor.22
The right of respondents predecessors over the subject
property is more than sufficient to uphold respondents
right to possession over the same. Respondents right to
the property was vested in her along with her siblings
from the moment of their fathers death.23 As heir,
respondent had the right to the possession of the property,
which is one of the attributes of ownership. Such rights are
enforced and protected from encroachments made or
attempted before the judicial declaration since respondent
acquired hereditary rights even before judicial declaration
in testate or intestate proceedings.24
After the death of Enrique Factor, it was his eldest child,
Gloria Factor-Labao who took over the administration of
the subject property. And as a consequence of co-
ownership,25 soon after the death of Gloria, respondent, as
one of the surviving co-owners, may be subrogated to the
rights of the deceased co-owner, which includes the right
to the administration and management of the subject
property.
As found by the Court of Appeals, petitioners unsupported
claim of possession must yield to that of the respondent
who traces her possession of the subject property to her
predecessors-in-interest who have always been in
possession of the subject property. Even assuming that
respondent was never a resident of the subject property,
she could legally continue possessing the property. Visiting
the property on weekends and holidays is evidence of
actual or physical possession.26 The fact of her residence
somewhere else, by itself, does not result in loss of
possession of the subject property. The law does not
require one in possession of a house to reside in the house
to maintain his possession.27 For, again, possession in the
eyes of the law does not mean that a man has to have his
feet on every square meter of the ground before he is
deemed in possession.28 There is no cogent reason to
deviate from this doctrine.
All things considered, this Court finds that respondent Fe
S. Factor successfully proved the extent and character of
her possession over the disputed property. As a
Rule 72: Subject Matter and Applicability of General Rules
consequence of her ownership thereof, respondent is
entitled to its possession, considering petitioners failure
to prove prior possession. The Court stresses, however,
that its determination of ownership in the instant case is
not final. It is only a provisional determination for the sole
purpose of resolving the issue of possession. It would not
bar or prejudice a separate action between the same
parties involving the quieting of title to the subject
property.29
As regards the means upon which the deprivation took
effect, it is not necessary that the respondent must
demonstrate that the taking was done with force,
intimidation threat, strategy or stealth. The Supreme
Court, in Baes v. Lutheran Church in the
Philippines,30 explained:
In order to constitute force that would justify a forcible
entry case, the trespasser does not have to institute a state
of war. The act of going to the property and excluding the
lawful possessor therefrom necessarily implies the
exertion of force over the property which is all that is
necessary and sufficient to show that the action is based
on the provisions of Section 1, Rule 70 of the Rules of
Court.31
As expressly stated in David v. Cordova:32
The words by force, intimidation, threat, strategy or
stealth include every situation or condition under which
one person can wrongfully enter upon real property and
exclude another, who has had prior possession therefrom.
If a trespasser enters upon land in open daylight, under the
very eyes of the person already clothed with lawful
possession, but without the consent of the latter, and there
plants himself and excludes such prior possessor from the
property, the action of forcible entry and detainer can
unquestionably be maintained, even though no force is
used by the trespasser other than such as is necessarily
implied from the mere acts of planting himself on the
ground and excluding the other party.33
Respondent, as co-owner, has the control of the subject
property even if she does not stay in it. So when
petitioners entered said property without the consent and
permission of the respondent and the other co-owners, the
latter were deprived of its possession. Moreover, the
presence of an unidentified man forbidding respondent
from entering the subject property constitutes force
contemplated by Section 1,34 Rule 70 of the Rules of
Court.1avvphi1
As to the last issue, we have previously ruled that while the
courts may fix the reasonable amount of rent for the use
and occupation of a disputed property, they could not
simply rely on their own appreciation of land values
without considering any evidence. The reasonable amount
of any rent could not be determined by mere judicial
notice but by supporting evidence.35 In the instant case, we
find no evidence on record to support the MeTCs award of
rent.
On the matter of attorneys fees awarded to the
respondent, we are in agreement to delete it. It is a well-
settled rule that where attorneys fees are granted, the
court must explicitly state in the body of the decision, and
not only in the dispositive portion thereof, the legal reason
for the award.36 Again, nothing in the body of both
decisions of RTC and MeTC explicitly stated the reasons for
the award of attorneys fees.
Page 38
WHEREFORE, the instant petition is DENIED. The
challenged Decision dated January 16, 2006 and
Resolution dated April 26, 2006 of the Court of Appeals in
CA-G.R. SP No. 90397 are AFFIRMED with MODIFICATION
that the award of rentals and attorneys fees are DELETED.
Subsequently, Rufina Luy Lim filed a verified amended
petition9 which contained the following averments:
3. The late Pastor Y. Lim personally owned during his
lifetime the following business entities, to wit:

No pronouncement as to costs. Business

Address:
Entity
SO ORDERED.

G.R. No. 124715 January 24, 2000 xxx xxx xxx

RUFINA LUY LIM, petitioner,
vs. Alliance Block 3, Lot 6, Dacca BF
COURT OF APPEALS, AUTO TRUCK TBA Marketing, Inc. Homes, Paraaque, Metro
CORPORATION, SPEED DISTRIBUTING, INC., ACTIVE Manila.
DISTRIBUTORS, ALLIANCE MARKETING
CORPORATION, ACTION COMPANY, INC. respondents.
xxx xxx xxx
BUENA, J.:
Speed
May a corporation, in its universality, be the proper subject 910 Barrio Niog, Aguinaldo
Distributing
of and be included in the inventory of the estate of a Highway, Bacoor, Cavite.
Inc.
deceased person?

Petitioner disputes before us through the instant petition xxx xxx xxx
for review on certiorari, the decision1 of the Court of
Appeals promulgated on 18 April 1996, in CA-GR SP No.
38617, which nullified and set aside the orders dated 04 Auto Truck 2251 Roosevelt Avenue,
July 19952, 12 September 19953 and 15 September TBA Corp. Quezon City.
19954 of the Regional Trial Court of Quezon City, Branch
93, sitting as a probate court.
xxx xxx xxx
Petitioner Rufina Luy Lim is the surviving spouse of late
Pastor Y. Lim whose estate is the subject of probate Active Block 3, Lot 6, Dacca BF
proceedings in Special Proceedings Q-95-23334, entitled, Distributors, Homes, Paraaque, Metro
"In Re: Intestate Estate of Pastor Y. Lim Rufina Luy Lim, Inc. Manila.
represented by George Luy, Petitioner".1wphi1.nt

Private respondents Auto Truck Corporation, Alliance xxx xxx xxx

Marketing Corporation, Speed Distributing, Inc., Active
Distributing, Inc. and Action Company are corporations
formed, organized and existing under Philippine laws and
which owned real properties covered under the Torrens
system.
On 11 June 1994, Pastor Y. Lim died intestate. Herein
petitioner, as surviving spouse and duly represented by
her nephew George Luy, fried on 17 March 1995, a joint
petition5 for the administration of the estate of Pastor Y.
Lim before the Regional Trial Court of Quezon City.
Private respondent corporations, whose properties were
included in the inventory of the estate of Pastor Y. Lim,
then filed a motion6 for the lifting of lis pendens and
motion7 for exclusion of certain properties from the estate
of the decedent.
In an order8 dated 08 June 1995, the Regional Trial Court
of Quezon City, Branch 93, sitting as a probate court,
granted the private respondents' twin motions, in this
wise:
Wherefore, the Register of Deeds of Quezon City is hereby
ordered to lift, expunge or delete the annotation of lis
pendens on Transfer Certificates of Title Nos. 116716,
116717, 116718, 116719 and 5182 and it is hereby further
ordered that the properties covered by the same titles as
well as those properties by (sic) Transfer Certificate of
Title Nos. 613494, 363123, 236236 and 263236 are
excluded from these proceedings.
Action 100 20th Avenue Murphy,
Company Quezon City or 92-D Mc-
Arthur Highway Valenzuela
Bulacan.
3.1 Although the above business entities dealt and engaged
in business with the public as corporations, all their
capital, assets and equity were however, personally owned
by the late Pastor Y Lim. Hence the alleged stockholders
and officers appearing in the respective articles of
incorporation of the above business entities were mere
dummies of Pastor Y. Lim, and they were listed therein
only for purposes of registration with the Securities and
Exchange Commission.
4. Pastor Lim, likewise, had Time, Savings and Current
Deposits with the following banks: (a) Metrobank, Grace
Park, Caloocan City and Quezon Avenue, Quezon City
Branches and (b) First Intestate Bank (formerly Producers
Bank), Rizal Commercial Banking Corporation and in other
banks whose identities are yet to be determined.
5. That the following real properties, although registered
in the name of the above entities, were actually acquired
by Pastor Y. Lim during his marriage with petitioner, to
wit:
Corporation Title Location

SO ORDERED.
Rule 72: Subject Matter and Applicability of General Rules Page 39
 xxx xxx xxx
k. Auto Truck TCT No. Sto. Domingo
617726 TBA
Corporation
Cainta, Rizal
q. Alliance TCT No. Prance, Metro
Marketing 27896 Manila
Copies of the above-mentioned Transfer Certificate of Title
and/or Tax Declarations are hereto attached as Annexes
"C" to "W".
xxx xxx xxx
7. The aforementioned properties and/or real interests left
by the late Pastor Y. Lim, are all conjugal in nature, having
been acquired by him during the existence of his marriage
with petitioner.
8. There are other real and personal properties owned by
Pastor Y. Lim which petitioner could not as yet identify.
Petitioner, however will submit to this Honorable Court
the identities thereof and the necessary documents
covering the same as soon as possible.
On 04 July 1995, the Regional Trial Court acting on
petitioner's motion issued an order10, thus:
Wherefore, the order dated 08 June 1995 is hereby set
aside and the Registry of Deeds of Quezon City is hereby
directed to reinstate the annotation of lis pendens in case
said annotation had already been deleted and/or cancelled
said TCT Nos. 116716, 116717, 116718, 116719 and
51282.
Further more (sic), said properties covered by TCT Nos.
613494, 365123, 236256 and 236237 by virtue of the
petitioner are included in the instant petition.
SO ORDERED.
On 04 September 1995, the probate court appointed
Rufina Lim as special administrator11 and Miguel Lim and
Lawyer Donald Lee, as co-special administrators of the
estate of Pastor Y. Lim, after which letters of
administration were accordingly issued.
In an order12 dated 12 September 1995, the probate court
denied anew private respondents' motion for exclusion, in
this wise:
The issue precisely raised by the petitioner in her petition
is whether the corporations are the mere alter egos or
instrumentalities of Pastor Lim, Otherwise (sic) stated, the
issue involves the piercing of the corporate veil, a matter
that is clearly within the jurisdiction of this Honorable
Court and not the Securities and Exchange Commission.
Thus, in the case of Cease vs. Court of Appeals, 93 SCRA 483,
the crucial issue decided by the regular court was whether
the corporation involved therein was the mere extension
of the decedent. After finding in the affirmative, the Court
ruled that the assets of the corporation are also assets of
the estate.
A reading of P.D. 902, the law relied upon by oppositors,
shows that the SEC's exclusive (sic) applies only to intra-
corporate controversy. It is simply a suit to settle the
intestate estate of a deceased person who, during his
Rule 72: Subject Matter and Applicability of General Rules
lifetime, acquired several properties and put up
corporations as his instrumentalities.
SO ORDERED.
On 15 September 1995, the probate court acting on an ex
parte motion filed by petitioner, issued an order13 the
dispositive portion of which reads:
Wherefore, the parties and the following banks concerned
herein under enumerated are hereby ordered to comply
strictly with this order and to produce and submit to the
special administrators, through this Honorable Court
within (5) five days from receipt of this order their
respective records of the savings/current accounts/time
deposits and other deposits in the names of Pastor Lim
and/or corporations above-mentioned, showing all the
transactions made or done concerning savings/current
accounts from January 1994 up to their receipt of this
court order.
xxx xxx xxx
SO ORDERED.
Private respondent filed a special civil action
for certiorari14, with an urgent prayer for a restraining
order or writ of preliminary injunction, before the Court of
Appeals questioning the orders of the Regional Trial Court,
sitting as a probate court.
On 18 April 1996, the Court of Appeals, finding in favor of
herein private respondents, rendered the assailed
decision15, the decretal portion of which declares:
Wherefore, premises considered, the instant special civil
action for certiorari is hereby granted, The impugned
orders issued by respondent court on July 4, 1995 and
September 12, 1995 are hereby nullified and set aside. The
impugned order issued by respondent on September 15,
1995 is nullified insofar as petitioner corporations" bank
accounts and records are concerned.
SO ORDERED.
Through the expediency of Rule 45 of the Rules of Court,
herein petitioner Rufina Luy Lim now comes before us
with a lone assignment of
error16:
The respondent Court of Appeals erred in reversing the
orders of the lower court which merely allowed the
preliminary or provisional inclusion of the private
respondents as part of the estate of the late deceased (sic)
Pastor Y. Lim with the respondent Court of Appeals
arrogating unto itself the power to repeal, to disobey or to
ignore the clear and explicit provisions of Rules 81,83,84
and 87 of the Rules of Court and thereby preventing the
petitioner, from performing her duty as special
administrator of the estate as expressly provided in the
said Rules.
Petitioner's contentions tread on perilous grounds.
In the instant petition for review, petitioner prays that we
affirm the orders issued by the probate court which were
subsequently set aside by the Court of Appeals.
Yet, before we delve into the merits of the case, a review of
the rules on jurisdiction over probate proceedings is
indeed in order.
Page 40
The provisions of Republic Act 769117, which introduced
amendments to Batas Pambansa Blg. 129, are pertinent:
Sec. 1. Section 19 of Batas Pambansa Blg. 129, otherwise
known as the "Judiciary Reorganization Act of 1980", is
hereby amended to read as follows:
Sec. 19. Jurisdiction in civil cases. Regional Trial Courts
shall exercise exclusive jurisdiction:
xxx xxx xxx
(4) In all matters of probate, both testate and intestate,
where the gross value of the estate exceeds One Hundred
Thousand Pesos (P100,000) or, in probate matters in
Metro Manila, where such gross value exceeds Two
Hundred Thousand Pesos (P200,000);
xxx xxx xxx
Sec. 3. Section 33 of the same law is hereby amended to
read as follows:
Sec. 33. Jurisdiction of Metropolitan Trial Courts, Municipal
Trial Courts and Municipal Circuit Trial Courts in Civil
Cases. Metropolitan Trial Courts, Municipal Trial Courts
and Municipal Circuit Trial Courts shall exercise:
1. Exclusive original jurisdiction over civil actions and
probate proceedings, testate and intestate, including the
grant of provisional remedies in proper cases, where the
value of the personal property, estate or amount of the
demand does not exceed One Hundred Thousand Pesos
(P100,000) or, in Metro Manila where such personal
property, estate or amount of the demand does not exceed
Two Hundred Thousand Pesos (P200,000), exclusive of
interest, damages of whatever kind, attorney's fees,
litigation expenses and costs, the amount of which must be
specifically alleged, Provided, that interest, damages of
whatever kind, attorney's, litigation expenses and costs
shall be included in the determination of the filing
fees, Provided further, that where there are several claims
or causes of actions between the same or different parties,
embodied in the same complaint, the amount of the
demand shall be the totality of the claims in all the causes
of action, irrespective of whether the causes of action
arose out of the same or different transactions;
xxx xxx xxx
Simply put, the determination of which court exercises
jurisdiction over matters of probate depends upon the
gross value of the estate of the decedent.
As to the power and authority of the probate court,
petitioner relies heavily on the principle that a probate
court may pass upon title to certain properties, albeit
provisionally, for the purpose of determining whether a
certain property should or should not be included in the
inventory.
In a litany of cases, We defined the parameters by which
the court may extend its probing arms in the
determination of the question of title in probate
proceedings.
This Court, in PASTOR, JR. vs. COURT OF APPEALS,18 held:
. . . As a rule, the question of ownership is an extraneous
matter which the probate court cannot resolve with
finality. Thus, for the purpose of determining whether a
certain property should or should not be included in the
inventory of estate properties, the Probate Court may pass
Rule 72: Subject Matter and Applicability of General Rules
upon the title thereto, but such determination is
provisional, not conclusive, and is subject to the final
decision in a separate action to resolve title.
We reiterated the rule in PEREIRA vs. COURT OF
APPEALS19:
. . . The function of resolving whether or not a certain
property should be included in the inventory or list of
properties to be administered by the administrator is one
clearly within the competence of the probate court.
However, the court's determination is only provisional in
character, not conclusive, and is subject to the final
decision in a separate action which may be instituted by
the parties.
Further, in MORALES vs. CFI OF CAVITE20 citing CUIZON
vs. RAMOLETE21, We made an exposition on the probate
court's limited jurisdiction:
It is a well-settled rule that a probate court or one in
charge of proceedings whether testate or intestate cannot
adjudicate or determine title to properties claimed to be a
part of the estate and which are equally claimed to belong
to outside parties. All that the said court could do as
regards said properties is to determine whether they
should or should not be included in the inventory or list of
properties to be administered by the administrator. If
there is no dispute, well and good; but if there is, then the
parties, the administrator and the opposing parties have to
resort to an ordinary action for a final determination of the
conflicting claims of title because the probate court cannot
do so.
Again, in VALERA vs. INSERTO22, We had occasion to
elucidate, through Mr. Justice Andres Narvasa23:
Settled is the rule that a Court of First Instance (now
Regional Trial Court), acting as a probate court, exercises
but limited jurisdiction, and thus has no power to take
cognizance of and determine the issue of title to property
claimed by a third person adversely to the decedent,
unless the claimant and all other parties having legal
interest in the property consent, expressly or impliedly, to
the submission of the question to the probate court for
adjudgment, or the interests of third persons are not
thereby prejudiced, the reason for the exception being that
the question of whether or not a particular matter should
be resolved by the court in the exercise of its general
jurisdiction or of its limited jurisdiction as a special court
(e.g. probate, land registration, etc.), is in reality not a
jurisdictional but in essence of procedural one, involving a
mode of practice which may be waived. . . .
. . . . These considerations assume greater cogency where,
as here, the Torrens title is not in the decedent's name but
in others, a situation on which this Court has already had
occasion to rule . . . . (emphasis Ours)
Petitioner, in the present case, argues that the parcels of
land covered under the Torrens system and registered in
the name of private respondent corporations should be
included in the inventory of the estate of the decedent
Pastor Y. Lim, alleging that after all the determination by
the probate court of whether these properties should be
included or not is merely provisional in nature, thus, not
conclusive and subject to a final determination in a
separate action brought for the purpose of adjudging once
and for all the issue of title.
Yet, under the peculiar circumstances, where the parcels of
land are registered in the name of private respondent
Page 41
corporations, the jurisprudence pronounced in BOLISAY
vs., ALCID 24 is of great essence and finds applicability,
thus:
It does not matter that respondent-administratrix has
evidence purporting to support her claim of ownership,
for, on the other hand, petitioners have a Torrens title in
their favor, which under the law is endowed with
incontestability until after it has been set aside in the
manner indicated in the law itself, which of course, does
not include, bringing up the matter as a mere incident in
special proceedings for the settlement of the estate of
deceased persons. . . .
. . . . In regard to such incident of inclusion or exclusion, We
hold that if a property covered by Torrens title is involved,
the presumptive conclusiveness of such title should be
given due weight, and in the absence of strong compelling
evidence to the contrary, the holder thereof should be
considered as the owner of the property in controversy
until his title is nullified or modified in an appropriate
ordinary action, particularly, when as in the case at bar,
possession of the property itself is in the persons named in
the title. . . .
A perusal of the records would reveal that no strong
compelling evidence was ever presented by petitioner to
bolster her bare assertions as to the title of the deceased
Pastor Y. Lim over the properties. Even so, P.D. 1529,
otherwise known as, "The Property Registration Decree",
proscribes collateral attack on Torrens Title, hence:
xxx xxx xxx
Sec. 48. Certificate not subject to collateral attack. A
certificate of title shall not be subject to collateral attack. It
cannot be altered, modified or cancelled except in a direct
proceeding in accordance with law.
In CUIZON vs. RAMOLETE, where similarly as in the case at
bar, the property subject of the controversy was duly
registered under the Torrens system, We categorically
stated:
. . . Having been apprised of the fact that the property in
question was in the possession of third parties and more
important, covered by a transfer certificate of title issued
in the name of such third parties, the respondent court
should have denied the motion of the respondent
administrator and excluded the property in question from
the inventory of the property of the estate. It had no
authority to deprive such third persons of their possession
and ownership of the property. . . .
Inasmuch as the real properties included in the inventory
of the estate of the Late Pastor Y. Lim are in the possession
of and are registered in the name of private respondent
corporations, which under the law possess a personality
separate and distinct from their stockholders, and in the
absence of any cogency to shred the veil of corporate
fiction, the presumption of conclusiveness of said titles in
favor of private respondents should stand undisturbed.
Accordingly, the probate court was remiss in denying
private respondents' motion for exclusion. While it may be
true that the Regional Trial Court, acting in a restricted
capacity and exercising limited jurisdiction as a probate
court, is competent to issue orders involving inclusion or
exclusion of certain properties in the inventory of the
estate of the decedent, and to adjudge, albeit, provisionally
the question of title over properties, it is no less true that
such authority conferred upon by law and reinforced by
Rule 72: Subject Matter and Applicability of General Rules
jurisprudence, should be exercised judiciously, with due
regard and caution to the peculiar circumstances of each
individual case.
Notwithstanding that the real properties were duly
registered under the Torrens system in the name of
private respondents, and as such were to be afforded the
presumptive conclusiveness of title, the probate court
obviously opted to shut its eyes to this gleamy fact and still
proceeded to issue the impugned orders.
By its denial of the motion for exclusion, the probate court
in effect acted in utter disregard of the presumption of
conclusiveness of title in favor of private respondents.
Certainly, the probate court through such brazen act
transgressed the clear provisions of law and infringed
settled jurisprudence on this matter.
Moreover, petitioner urges that not only the properties of
private respondent corporations are properly part of the
decedent's estate but also the private respondent
corporations themselves. To rivet such flimsy contention,
petitioner cited that the late Pastor Y. Lim during his
lifetime, organized and wholly-owned the five
corporations, which are the private respondents in the
instant case.25 Petitioner thus attached as Annexes
"F"26 and "G"27 of the petition for review affidavits
executed by Teresa Lim and Lani Wenceslao which among
others, contained averments that the incorporators of
Uniwide Distributing, Inc. included on the list had no
actual and participation in the organization and
incorporation of the said corporation. The affiants added
that the persons whose names appeared on the articles of
incorporation of Uniwide Distributing, Inc., as
incorporators thereof, are mere dummies since they have
not actually contributed any amount to the capital stock of
the corporation and have been merely asked by the late
Pastor Y. Lim to affix their respective signatures thereon.
It is settled that a corporation is clothed with personality
separate and distinct from that of the persons composing
it. It may not generally be held liable for that of the persons
composing it. It may not be held liable for the personal
indebtedness of its stockholders or those of the entities
connected with it.28
Rudimentary is the rule that a corporation is invested by
law with a personality distinct and separate from its
stockholders or members. In the same vein, a corporation
by legal fiction and convenience is an entity shielded by a
protective mantle and imbued by law with a character
alien to the persons comprising it.
Nonetheless, the shield is not at all times invincible. Thus,
in FIRST PHILIPPINE INTERNATIONAL BANK vs. COURT OF
APPEALS29, We enunciated:
. . . When the fiction is urged as a means of perpetrating a
fraud or an illegal act or as a vehicle for the evasion of an
existing obligation, the circumvention of statutes, the
achievement or perfection of a monopoly or generally the
perpetration of knavery or crime, the veil with which the
law covers and isolates the corporation from the members
or stockholders who compose it will be lifted to allow for
its consideration merely as an aggregation of individuals. . .
.
Piercing the veil of corporate entity requires the court to
see through the protective shroud which exempts its
stockholders from liabilities that ordinarily, they could be
subject to, or distinguishes one corporation from a
Page 42
seemingly separate one, were it not for the existing to demand the production of bank accounts in the name of
corporate fiction.30 the private respondent corporations.

The corporate mask may be lifted and the corporate veil WHEREFORE, in view of the foregoing disquisitions, the
may be pierced when a corporation is just but the alter ego instant petition is hereby DISMISSED for lack of merit and
of a person or of another corporation. Where badges of the decision of the Court of Appeals which nullified and set
fraud exist, where public convenience is defeated; where a aside the orders issued by the Regional Trial Court, Branch
wrong is sought to be justified thereby, the corporate 93, acting as a probate court, dated 04 July 1995 and 12
fiction or the notion of legal entity should come to September 1995 is AFFIRMED.
naught.31
SO ORDERED.
Further, the test in determining the applicability of the
doctrine of piercing the veil of corporate fiction is as
follows: 1) Control, not mere majority or complete stock
control, but complete domination, not only of finances but
of policy and business practice in respect to the
transaction attacked so that the corporate entity as to this
transaction had at the time no separate mind, will or
existence of its own; (2) Such control must have been used
by the defendant to commit fraud or wrong, to perpetuate
the violation of a statutory or other positive legal duty, or
dishonest and unjust act in contravention of plaintiffs legal
right; and (3) The aforesaid control and breach of duty
must proximately cause the injury or unjust loss
complained of. The absence of any of these elements
prevent "piercing the corporate veil".32

Mere ownership by a single stockholder or by another

corporation of all or nearly all of the capital stock of a
corporation is not of itself a sufficient reason for
disregarding the fiction of separate corporate
personalities.33

Moreover, to disregard the separate juridical personality

of a corporation, the wrong-doing must be clearly and
convincingly established. It cannot be presumed.34

Granting arguendo that the Regional Trial Court in this

case was not merely acting in a limited capacity as a
probate court, petitioner nonetheless failed to adduce
competent evidence that would have justified the court to
impale the veil of corporate fiction. Truly, the reliance
reposed by petitioner on the affidavits executed by Teresa
Lim and Lani Wenceslao is unavailing considering that the
aforementioned documents possess no weighty probative
value pursuant to the hearsay rule. Besides it is imperative
for us to stress that such affidavits are inadmissible in
evidence inasmuch as the affiants were not at all presented
during the course of the proceedings in the lower court. To
put it differently, for this Court to uphold the admissibility
of said documents would be to relegate from Our duty to
apply such basic rule of evidence in a manner consistent
with the law and jurisprudence.

Our pronouncement in PEOPLE BANK AND TRUST

COMPANY vs. LEONIDAS35 finds pertinence:

Affidavits are classified as hearsay evidence since they are

not generally prepared by the affiant but by another who
uses his own language in writing the affiant's statements,
which may thus be either omitted or misunderstood by the
one writing them. Moreover, the adverse party is deprived
of the opportunity to cross-examine the affiants. For this
reason, affidavits are generally rejected for being hearsay,
unless the affiant themselves are placed on the witness
stand to testify thereon.

As to the order36 of the lower court, dated 15 September

1995, the Court of Appeals correctly observed that the
Regional Trial Court, Branch 93 acted without jurisdiction
in issuing said order; The probate court had no authority

Rule 72: Subject Matter and Applicability of General Rules Page 43