G.R. No.

L-49065 April 30, 1947

RITA GARCHITORENA VDA. DE CENTENERA, applicant-appellee;

MARIANO GARCHITORENA, movant-appellee,
vs.
VICENTE SOTTO, H.P. OBIAS and ANA PATAAN, oppositors-appellants.

Lorenzo Sumulong for oppositor and appellant Sotto.

Jose M. Peas for oppositors and appellants Obias and Pataan.
Jose Ma. Recto and Jayme Reyes for applicant and appellee Garchitorena.
Manly and Reyes for movant and appellee.

PERFECTO, J.:

On June 20, 1940, Mariano Garchitorena file a motion praying that subdivision plan Psu-66063-Amd., marked
as Annex E, be approved and that it be decreed that certificates of title be issued in his name on lots 2, 3, and 4
of the original plan Psu-66063 and upon lots 1, 5, 6, 7, and 8 of the subdivision plan Psu-66063-Amd.

The movant alleged that on May 14, 1931, a decision was rendered by the lower court granting Rita
Garchitorena as heiress of her father Andres, title over four lots, the same described in her original application,
subject to lien in favor of Mariano Garchitorena and other creditors, with the exclusion of about 500 hectares
belonging to Ramon and Jose Alvarez, about 300 hectares of land of the public domain, a portion of 18 hectares
belonging to Hermogenes P. Obias and another portion of 24 hectares of land of the public domain, with the
exception of 4 hectares belonging to Januario Alvarez, all said portions being included in lot number 1. It is also
alleged that after said judgment was modified by the Supreme Court and some steps have been taken as a result
of said modification, lots 1, 2, 3, and 4 of land Psu-66063 were adjudicated to Mariano Garchitorena in
consideration of the amount of P28,745.93 a deed of sale having been executed to said effect on September 8,
1935, which was approved by the lower court on April 26, 1940, and that Mariano Garchitorena bought the 500
hectares of Ramon and Jose Alvarez on April 27, 1939.

Several persons appeared to oppose the motion, but only three of them came to us appealing against the lower
court's order dated June 28, 1941, decreeing the issuance of certificate of titles in favor of Mariano Garchitorena
on lots 2, 3, and 4 of the original plan Psu-66063, and on lots 5 and 8 of the subdivision plan Psu-66063-Amd.,
and on lots 1, 6, and 7 of the same subdivision plan.

The appellants are H.P. Obias, Ana Pataan and Vicente Sotto.
We will deal separately with their respective contentions.

OPPOSITION OF H.P. OBIAS

This oppositor contends that the 300 hectares ordered to be excluded from lot number 1 as land of public
domain, as provided in the lower court's decision of May 14, 1931, in fact should measure not only 300 hectares
but 961 hectares, 38 ares and 9 centares.

The lower court disposed of the opposition by stating that the decision of May 14, 1931, was amended, and the
Supreme Court affirmed it as amended, and that the subdivision plan Psu-66063-Amd. is in conformity with the
terms of said amended decision.

Appellant Obias complains in his appeal that the lower court erred in awarding to Mariano Garchitorena the title
of lots 1, 6, and 7 of subdivision plan Psu-66063-Amd., belonging originally to Ramon and Jose Alvarez.

No law and no authority has been invoked in support of appellant's contention, although he advances several
reasons in support of his theory. The reasons advanced are stated in his brief as follows:

1. Ramon Alvarez did not seek any affirmative relief in his opposition to the application for registration of Rita
Garchitorena so that what the Court did in rendering its decisions was simply to order its segregation from the
plan, and his supposed successor in interest, Mariano Garchitorena, could not be entitled to the issuance of a
degree of registration in the name of the latter.

2. Because the decision rendered in this case is already final, and hence cannot be amended.

3. Because the duty of the lower Court in regards to this case is simply to comply with that final judgment so
that inasmuch as the dispositive part orders the segregation from the plan of the portions awarded to Ramon
Alvarez, the lower Court is in duty-bound to comply with that mandatory order.

4. Because the issuance of a decree of registration in favor of the movant-appellant for the portions awarded to
Ramon Alvarez and Jose Alvarez would create an anomaly, in the sense that interested parties would be
prejudiced thereby. There are several persons possessing portions of land within the land adjudicated to Ramon
Alvarez and Jose Alvarez. They possessed these portions with a claim of right of ownership adverse to that of
Ramon Alvarez and Jose Alvarez.
We do not find in merit appellant's contention.

Section 38 of the Land Registration Act No. 496, as amended by Act No. 3621, which took effect on December
5, 1929, provides:

If the court after hearing finds that the applicant or adverse claimant has title as stated in his application or
adverse claim and proper for registration, a decree of confirmation and registration shall be entered . . ..

In the case of Garchitorena Vda. de Centenera vs. Obias (58 Phil., 21, 23), the Supreme Court declared that
from the evidence "it conclusively appears that the late Jose Alvarez and his successors had a considerable
extent of land in the same place where the applicant's land is situated, and taking also into account that the land
was surveyed for purposes of registration, we find that the weight of the evidence indicates that the land
claimed by the opponent Ramon Alvarez had been included in the applicant's plan. This land has an area of 500
hectares. According to Ramon Alvarez, it appears that his father, Ibo Alvarez, had held the tract since 1905 and
that at the death of said Ibo Alvarez, Ramon Alvarez and his co-owner, Jose Alvarez entered into possession
and have remained therein since."

From the above, there cannot be any doubt that Ramon and Jose Alvarez have been finally declared as the
owners of the 500 hectares in question, and such declaration is good for all purposes, including the issuance of
the corresponding certificates of title to said owners of their successors in interest, such as buyer Mariano
Garchitorena. Appellant's allegation that the decree of registration in favor of Mariano Garchitorena for the
portions awarded to Ramon and Jose Alvarez would prejudice interested parties is groundless, because all
interested parties were given full opportunity to advance and present their respective claims since the original
application was duly published and the proceedings for registration, which are in rem in character, were begun,
it appearing that the original application included the 500 hectares which were finally adjudicated to Ramon and
Jose Alvarez. Anybody and everybody who had any legitimate claim to said 500 hectares or any part thereof, if
they wanted to, could have appeared before the court and presented their claims. If they failed to do it at the
opportune time, it is now too later for them to complain.

APPEAL OF ANA PATAAN

This appellant complains that the lower court erred in holding that the free patent title number 1406 of said Ana
Pataan is null and void ab initio.
The lower court's actions is based upon the fact that when the free patent title number 1406 was issued in 1937,
the land of 10 hectares covered by it was part of a larger tract which was declared private property according to
the decision of May 14, 1931, which was later affirmed by the Supreme Court, very much earlier than the
issuance of the free patent title in question.

We do not find any error in the lower court's action.

The decision of the Supreme Court declaring the land in question as private property was promulgated on
March 4, 1933 (Garchitorena vs. Vda. de Centenera vs. Obias, 58 Phil., 21), that is more than four years before
the issuance of the free patent title in question on March 21, 1937.

Upon this conclusion, it will serve no purpose to pass upon the question raised by appellant Pataan as to the
court's denial of her motion for reopening, besides the fact that the basis of her contention, that she has not been
mentioned in the original application as possessor of the land which she is claiming, appear to be flimsy by the
fact that she is the wife of Senen Pandai who was appointed by Jose N. Garchitorena, to take care of the lands in
question.

APPEAL OF VICENTE SOTTO

This appellant alleges that on March 4, 1931, the Court of First Instance of Manila rendered a judgment
ordering Rita Garchitorena Vda. Centenera to pay him the amount of P960.84; that by virtue of a writ of
execution issued on March 22, 1932, the lots in question were attached and sold at public auction, the sheriff
issuing to appellant the deed of sale on August 7, 1934, which was later registered in the office of the Register
of Deeds of Camarines Sur.

The lower court found upon the evidence that lots 2, 3, and 4 of original plan Psu-66063 and lots 5 and 8 of the
subdivision plan Psu-66063-Amd. were adjudicated, by virtue of a decision of the Supreme Court on March 4,
1933, to Rita Garchitorena as heiress of her father, Andres Garchitorena, the adjudication subject to sections
712 and 713 of the Code of Civil Procedure.

Following directives in said decision, Mariano Garchitorena and brothers filed a complaint in the Court of First
Instance of Camarines Sur against Rita Garchitorena, and secured a judgment on December 20, 1934, ordering
Rita Garchitorena to deliver to the administrator of the deceased Andres Garchitorena the possession of the
lands decreed to be adjudicated to her in this case, with the declaration that the creditors of the intestate of
Andres Garchitorena will have the preferent right of retention upon said lands for costs and other expenses
caused by delays, and that the judicial administrator of the intestate was authorized on July 8, 1935, against
opposition of appellant Vicente Sotto, to sell at public auction the above five lots in order to pay the credits of
Mariano, Flor, and Marcel Garchitorena.

Oppositor Vicente Sotto appealed against the order to the Supreme Court, which affirmed the appealed order,
overruling later on several motions for reconsideration filed by said appellant.

The judicial administrator, consequently, sold at public auction on September 7, 1935, the lots in question to
Mariano Garchitorena, who happened to have appeared as the only buyer, at the price of P28,745.93. The deed
of sale was executed on September 8, 1935, and approved by the court on April 26, 1940, against the opposition
of appellant Vicente Sotto.

On April 27, 1939, Mariano Garchitorena bought the 500 hectares adjudicated by the Supreme Court to Ramon
and Jose Alvarez, comprising lots 1, 6, and 7 of the subdivision plan Psu-66063-Amd.

From the foregoing undisputed facts, no issue of facts having been raised in any of the appeals in this case, it
appears that Rita Garchitorena has never become the owner of the lots in question, it appearing that the
adjudication made in her favor was subject to the provisions of sections 712 and 713 of the Code of Civil
Procedure, which in substance means without prejudice to the rights of the creditors of her deceased father,
Andres Garchitorena.

Although the Civil Code provides that succession takes effect from the time of the death of the owner, such
provision does not create a succession which, as a matter of fact, does not exist, as in the case of what the
deceased Andres Garchitorena could have left to his daughter Rita.

In the contemplation of the law, no succession shall be declared unless and until a liquidation of the assets and
debts left by the deceased shall have been made and all his creditors fully paid. Until a final liquidation is made
and all debts are paid, there is no way of determining if his heirs may inherit anything.

Until such a liquidation has been made, the right of heirs to inherit remains to be inchoate. It partakes of the
nature of hope. Liquidation is necessary to determine if the deceased has left any liquid asset which may be
transmitted to his heirs. Before any liquid asset is determined, all debts and obligations must first be liquidated
and paid.

In the instant case it appears that after the lots in question had been sold at public auction to Mariano
Garchitorena at the price of P28,745.93 with which the debt of the deceased Andres Garchitorena to Mariano,
Flor, and Marcel Garchitorena were paid, no property or asset remained to be adjudicated to his daughter Rita
Garchitorena. Consequently, at the public auction in which appellant alleges he bought the lots in question from
Rita Garchitorena to collect the amount of P960.84, as a matter of fact appellant bought nothing, it appearing
that what he bought as belonging to Rita Garchitorena did not belong to the latter.

Appellant alleges that he cannot be prejudiced by judgments or orders issued in other cases in which he has not
been a party, and said other cases are the petition for land registration filed by Rita Garchitorena, decided by the
Court of First Instance of Camarines Sur on May 14, 1931, with the modification decreed by the Supreme Court
on March 4, 1933 (58 Phil., 21); civil case No. 5782 of the Court of First Instance of Camarines Sur instituted
by Mariano, Flor, and Marcel Garchitorena against Rita Garchitorena, to recover the lots in question, on the
ground that said properties pertained really to the deceased Andres Garchitorena and should be made available
to answer for the latters debt, and the intestate of Andres Garchitorena, case No. 2881 of the Court of First
Instance of Camarines Sur, in which proceedings took place ending in the sale of the lots in question to Mariano
Garchitorena (SC-G.R. No. 44854).

In the latter case appellant filed on June 4, 1935, an opposition to have the properties in question sold to satisfy
claims of Mariano, Flor and Marcel Garchitorena against the deceased Andres Garchitorena. In said opposition
appellant alleged:

Comparece Vicente Sotto, por si y en su propia representacion, como tercerista en este asunto, y se opone a la
mocion de Mariano Garchitorena y Marcel Garchitorena, de fecha 20 de Mayo de 1935, pidiendo la venta en
privado o en publica subasta de las parcelas de terreno descritas en la misma, por el fundamento de que el
infrascrito es el unico y absoluto dueode dichas parcelas de terreno.

1. En los asuntos R.G. Nos. 36385 y 36547, titulados Rita Garchitorena Vda. de Centenera contra Hermogenes
P. Obias, et al., y Rita Garchitorena Vda. de Centenera contra El Director de Terrenos y otros, respectivamente,
el Tribunal Supremo decreto, en decision de Marzo 4, 1933, que todas las parcelas de terreno descritas en la
mencionada mocion fuesen registradas a nombre de Rita Garchitorena (Gac. Of., Vol. XXXII, No. 18, de
Febrero 10, 1934.)

2. En el asunto No. 38722 del Juzgado de Primera Instancia de Manila, promovido por Vicente Sotto contra
Rita Garchitorena Vda. de Centenera, se dicto con fecha 31 de Mayo de 1931 sentencia en favor del
demandante y contra la demandada; y, habiendose quedado firme y ejecutoria dicha sentencia, las parcelas de
terreno en cuestion, que son las mismas descritas en la mocion de que se trata en el presente asunto, fueron
vendidas en publica subasta por el Sheriff Provincial de Camarines Sur, y adquiridas por el compareciente el 7
de Julio de 1933 en que se verifico dicha venta en publica subasta.
3. El dia 1. de Septiembre de 1933 se expedio por el Sheriff de Camarines Sur en favor del comprador Vicente
Sotto el correspondiente Certificado de Venta, sobre dichas parcelas de terreno, y dicho certificado de venta fue
anotado en el Registro de la Propriedad de Camarines Sur correspondiente el 20 de Septiembre de 1933; y

4. No habiendose ejercitado por las ejecutadas en el citado asunto su derecho de retracto, dentro del plazo legal,
el 6 de Agosto de 1934, elcitado Sherifff Provincial de Camarines Sur expedio en favor de Vicente Sotto el
certificado de Venta absoluta, el cual fue igualmente anotado en el Registro de la Propriedad de Camarines Sur
correspondiente en la misma fecha, y una copia del cual se acompaa a este asunto y se marca como Exhibito
"A-T" del infrascrito tercerista.

De los hechos que preceden como se ve, resulta que el aqui tercerista, Vicente Sotto, adquirio las parcelas de
terreno en cuestion en virtud de compra en publica subasta, anunciada y llevada a cabo por el Sheriff Provincial
de Camarines Sur el 7 de Julio de 1933, o sea mucho antes de que este Juzgado dictara el 20 de Diciembre de
1934 su sentencia en el asunto No. 5782, titulado Marian de Garchitorena, Flor Garchitorena y Marcel
Garchitorena contra Rita Garchitorena Vda. de Centenera y Jose N. Garchitorena en su capacidad de
administrador judicial del abintestato del finado Andres Garchitorena.

Appellant's contentions were overruled by the Court of First Instance of Camarines Sur. Appellant appealed to
the Supreme Court, which, on December 5, 1938 (G.R. No. 44854), overruling again appellant's contentions,
among others, stated:

Claiming to have acquired title to the land in question by reason of a sheriff's sale made in his favor, the
appellant, after obtaining a permission to intervene, filed a written opposition to the aforesaid motion of
Mariano de Garchitorena, Flor Garchitorena and Marcel Garchitorena. The court below rejected this opposition,
on the ground that, although the sheriff's sale was made prior to the rendition of the judgment in civil case No.
5782, it could not prevail against the said judgment, in view of the fact, that, prior to the sale, a notice of lis
pendens was filed in connection with that case.

In support of this appeal, it is now contended that the notice of lis pendens could not prejudice the right of the
appellant to the land in question because such notice could only affect land registered under Act No. 496.
Appellant further relies on section 194 of the Administrative Code, as amended, which in part provides that
"any registration made under this section shall be understood to be without prejudice to a third party with better
right." The point thus raised is set at rest by the decisions of this court in Atkins, Kroll & Company vs.
Domingo, 46 Phil., 362, and Felino vs. Sanz, 44 Phil., 691. In the latter case, this court held that "a transferee
pendente lite of real property in litigation is bound by a judgment against his predecessor in interest and is a
proper but not an indispensable part."
Appellant also claims that he could not be affected by the judgment rendered in civil case No. 5782, because it
was fraudulently obtained. This contention is without merit. The judgment in question must be presumed to be
legal and valid, unless shown by conclusive evidence to have obtained through fraud. No such evidence exists
in this case.

The questions raised in the above opposition are substantially the same as those raised in the supplementary
opposition filed by appellant in the case at bar.

When Mariano Garchitorena filed on February 24, 1940, a motion for the approval of the sale in his favor of the
lots in question, appellant filed an opposition, dated March 11, 1940, reiterating his alleged rights by virtue of
the levy and sale on execution in his favor. The opposition was overruled by an order dated April 26, 1940, in
which the sale in favor of Mariano Garchitorena was approved. Appellant did not appeal against said order.

The decision of the Supreme Court of December 5, 1938, in case G.R. No. 44854 and the unappealed order of
the Court of First Instance of Camarines Sur dated April 26, 1940, and special proceeding No. 2881 had finally
settled the questions raised by the appellant.

For all the foregoing, finding no merit in the appeals of appellants H.P. Obias, Ana Pataan, and Vicente Sotto,
the order of the lower court dated June 28, 1941, is affirmed, with costs against appellants.

Moran, C.J., Paras, Pablo, Bengzon, Briones, Padilla, and Tuason, JJ., concur.

Separate Opinions

HILADO, J., concurring and dissenting:

I concur in the disposition of the case as regards the parcels of land decreed by this Court in G.R. Nos. 36385
and 35547 in favor of Rita Garchitorena, and dissent from the remainder of the majority decision which affects
the parcels covered by the oppositions of the herein opponents-appellants.

These latter parcels, whose registration in the majority decision also decrees in favor of movant-appellee
Mariano Garchitorena, were never applied for in an application for registration, nor the subject of a like petition
on the part of any opponent in the original registration cases which, after having been appealed to this court,
were docketed and disposed of herein under G.R. Nos. 36385 and 36547 (see 58 Phil., 21). Those cases were
instituted, prosecuted and decided under Act No. 496. The judgment of this Court disposing of said cases and
promulgated on March 4, 1933, and elevated to the authority of res judicata seven years before the motion now
under consideration was filed in the court below, and more than fourteen years ago today, upheld the
oppositions filed by the Director of Lands, Hermogenes P. Obias (18 hectares), Ramon and Jose Alvares (500
hectares), and Januario Alferes (24 hectares), and ordered the amendment of the Plan Psu-66063 "so as to
exclude the portions of land pertaining to said opponents." No affirmative relief was granted said opponents in
the sense of decreeing the registration in their favor of the parcels of land respectively covered by their
oppositions.

Before the amendment of sections 34, 37, and 38 of Act No. 496 by sections 1, 2, and 3 of Act No. 3621, the
court has no jurisdiction to decree in the same proceeding the registration in favor of the opponent, even though
it should find that, as between the applicant and the opponent, the land belonged to the latter. In Tecson vs.
Corporacion de los PP. Dominicos (19 Phil., 79, 80), this Court, inter alia, said:

. . . this court has held heretofore that the jurisdiction of the Land Court extends no further than the inscription
of the land described in its final decree and the enforcement of that decree, and that, even though the land
described in the petition be found by the court, as between the petitioner and the oppositor, to be the property of
the opponent, such land can not be inscribed in his name, the Land Court having, as we have said, no
jurisdiction or power to do so. It naturally and necessarily follows that the opponent, if he desires the land of
which he claims ownership to be registered in accordance with law, must begin a new proceeding in the Land
Court for that purpose.

In this consisted at the time, the difference between registration proceedings under Act No. 496 and those under
Chapter VI of Act No. 926. (Sec. 64, latter Act.)

On December 5, 1929, section 34 of Act No. 496, it is true, was amended by section 1 of Act No. 3621, so that
the second sentence thereof thereafter reads as follows:

. . . The answer (or opposition, as it is often called) shall state all the objections to the application, and shall set
forth the interest claimed by the party filing the same and apply for the remedy desired, and shall be signed and
sworn to by him or by some person in his behalf.

Section 37 of Act No. 496 was also amended by section 2 of Act No. 3621, so that it partly read as follows:
SEC. 37. xxx xxx xxx

. . . in a case where there is an adverse claim, the court shall determine the conflicting interests of the applicant
and the adverse claimant, and after taking evidence shall dismiss the application if neither of them succeeds in
showing that he has proper title for registration, or shall enter a decree awarding the land applied for, or any part
thereof, to the person entitled thereto . . ..

But even after the amendment, the underscored portion of the above-quoted provisions clearly contemplate that
in order for the opponent to obtain from the court a decree of registration, he must apply for the same remedy.

It is likewise true that the same amending act reformed section 38 of Act No. 496 so that said section thereafter
read thus:

SEC. 38. If the court after hearing finds that the applicant or adverse claimant has title as stated in his
application or adverse claim and proper for registration, a decree of confirmation and registration shall be
entered.

There can be no dispute that in the original registration cases under consideration, no positive decree of
registration was prayed for by any opponent, as categorically required by section 34 of Act No. 496, as
amended; and certainly none has been decreed by the abovementioned final judgment of this Court, which was
beyond its power to amend, much less than of the lower court, when the latter in granting the motion under
consideration attempted to do so. It seems to me evident, therefore, that even if the opponents themselves had
sought such an amendment, it could not have been legally made at such a late date for the simple reason that
they had not applied for a decree of registration in their opposition as required in said provision, and
furthermore, because the judgment of this Court had long before become final and irrevocable. If the opponents
themselves could not legally have achieved such an end, how could their successor-in-interest, the movant-
appellee?

What could be the purpose of Act No. 3621, section 1, amending Act No. 496, section 34, in providing that the
opponent shall "apply for the remedy desired"? It is to presumed that this phrase was there used for a purpose
it would be an insult to the intelligence of the lawmaker to understand the contrary. What could be that
purpose? To my mind, it could only be to establish a basis for the court's jurisdiction to decree registration in
favor of the opponent and a condition precedent for the exercise thereof. The law undoubtedly aimed at duly
apprising the applicant and any other adverse claimants that such opponent was asserting a right to the
registration and was praying for that remedy, so that such applicant and other adverse claimants could duly meet
the pretensions of said opponent and protect their rights and interest accordingly. Under the provision, if the
opponent applied for a positive registration in his favor as the remedy that he desired, in case he should prove
title in himself proper for registration, the court would have jurisdiction to grant him that remedy. To say now
that even if he should not apply for the remedy the court could still grant it to him, would be tantamount to
declaring the quoted phrase utterly useless and devoid of meaning.

In Government of the Philippine Islands vs. Tombis Trio (50 Phil., 708), this Court said:

In a cadastral proceeding, a court has no jurisdiction to decree a lot to one who has put in no claim to it. The
written declaration claiming certain described property is the very basis of jurisdiction to render a judgment. . . .

While the present case is not concerned with a cadastral proceeding, it involves the registration of land like such
a proceeding and, as is well-known, a claim in a cadastral proceeding, which is denominated "answer" is for the
express purpose of securing the registration of the land covered thereby in the name of the claimant. That
"answer" is the pleading which the claimant files in view of and against the petition or application of the
Director of Lands which starts the case, in much the same way as an opposition or adverse claim in an ordinary
registration case is in answer to the application of the applicant which commences the latter proceeding. Hence,
in my opinion, the doctrine above-quoted from the Trio case is perfectly applicable herein.

It is likewise true that after Act No. 3621, more specifically on November 17, 1931, Act No. 3901 was enacted,
amending section 29 of Act No. 496 so as to read in part as follows:

SEC. 29. After the filing of the application and before that issuance of the decree of title by the Chief of the
General Land Registration Office the land therein described may be dealt with and instruments relating thereto
shall be recorded in the office of the register of deeds at any time before the issuance of the decree of title, in the
same manner as if no application had been made. The interested party may, however, present such instruments
to the Court of First Instance instead of presenting them to the office of the register of deeds, together with a
motion that the same be considered in relation with the application, and the court, after notice to the parties,
shall order such land registered subject to the incumbrance created by said instruments, or order the decree of
registration issued in the name of the buyer or of the person to whom the property has been conveyed by said
instruments. If such motion is made after the decision has become final, the court shall require the interested
party, before granting his motion, to pay the fees which the register of deeds would collect in accordance with
section one hundred and fourteen of this Act, as amended, if such instruments had been presented for
registration in the office of the register of deeds after registration of the original certificate of title. If the order
of the court abovementioned is received by the Chief of the Land Registration Office after issuance of the
decree of title, such order shall forthwith be forwarded by said officer to the register of deeds concerned, for
compliance therewith. If the proceedings upon the application end in the issuance of a decree of title, the
property included therein shall, as soon as said decree has been registered in the office of the register of deeds,
as provided in section forty-one, become registered land under this Act, . . .. (Emphasis supplied.)
Of course, under the provision just quoted it was proper for the lower court to decree the registration in favor of
movant-appellee of the parcels of land whose registration was ordered in favor of Rita Garchitorena, as original
applicant, in G.R. Nos. 36385 and 36547, but "the court shall require the interested party, before granting his
motion, to pay the fees which the register of deeds would collect in accordance with section one hundred and
fourteen of this Act, as amended, if such instruments had been presented for registration of the original
certificate of title."

It is clear from the section last above-quoted that its provision are confined to the application which starts the
registration proceedings. The phrase "after the filing of the application" in its first sentence can not refer but to
that which the applicant files, and this is the selfsame application which is alluded to in the remainder of the
section. If so, the provisions of said section do not apply to the opposition filed by the opponent. The writer
does not mean to be technical at all, but merely acts upon the principle that this Court has to exercise its
jurisdiction and powers by authority of law. Where the law-making body has seen fit to confine the provision to
the application, it is not for this Court to say that it would be more practical to extend it to the opposition.
Where the law is clear, the duty of the court is merely to apply it. Construction would be out of place and, if
attempted, would be no more nor less than judicial legislation. It would be just as obnoxious to our system of
government for the courts to legislate in the matter of their own jurisdiction as it would be for the legislature to
render judgment upon purely judicial questions.

I am forced to the conclusion that movant-appellee (a) must pay the fees above-mentioned pursuant to section
29 of Act No. 496, as amended, as a condition precedent to the registration in his name of the parcels of land
adjudicated to Rita Garchitorena, and (b) must file a separate proceeding for the registration of the parcels of
land covered by the said oppositions or any of them, in the regular manner and following the regular procedure.
G.R. No. L-770 April 27, 1948

ANGEL T. LIMJOCO, petitioner,

vs.
INTESTATE ESTATE OF PEDRO O. FRAGRANTE, deceased, respondent.

Angel Limjoco, Jr. and Delfin L. Gonzales for petitioner.

Bienvenido A. Tan for respondent.

HILADO, J.:

Under date of May 21, 1946, the Public Service Commission, through Deputy Commissioner Fidel Ibaez,
rendered its decision in case No. 4572 of Pedro O. Fragante, as applicant for a certificate of public convenience
to install, maintain and operate an ice plant in San Juan, Rizal, whereby said commission held that the evidence
therein showed that the public interest and convenience will be promoted in a proper and suitable manner "by
authorizing the operation and maintenance of another ice plant of two and one-half (2-) tons in the
municipality of San Juan; that the original applicant Pedro O. Fragante was a Filipino Citizen at the time of his
death; and that his intestate estate is financially capable of maintaining the proposed service". The commission,
therefore, overruled the opposition filed in the case and ordered "that under the provisions of section 15 of
Commonwealth Act No. 146, as amended a certificate of public convenience be issued to the Intestate Estate of
the deceased Pedro Fragante, authorizing said Intestate Estate through its Special or Judicial Administrator,
appointed by the proper court of competent jurisdiction, to maintain and operate an ice plant with a daily
productive capacity of two and one-half (2-1/2) tons in the Municipality of San Juan and to sell the ice produced
from said plant in the said Municipality of San Juan and in the Municipality of Mandaluyong, Rizal, and in
Quezon City", subject to the conditions therein set forth in detail (petitioner's brief, pp. 33-34).

Petitioner makes four assignments of error in his brief as follows:

1. The decision of the Public Service Commission is not in accordance with law.

2. The decision of the Public Service Commission is not reasonably supported by evidence.

3. The Public Service Commission erred in not giving petitioner and the Ice and Cold Storage Industries of the
Philippines, Inc., as existing operators, a reasonable opportunity to meet the increased demand.

4. The decision of the Public Service Commission is an unwarranted departure from its announced policy with
respect to the establishment and operation of ice plant. (Pp. 1-2, petitioner's brief.)

In his argument petitioner contends that it was error on the part of the commission to allow the substitution of
the legal representative of the estate of Pedro O. Fragante for the latter as party applicant in the case then
pending before the commission, and in subsequently granting to said estate the certificate applied for, which is
said to be in contravention of law.

If Pedro O. Fragante had not died, there can be no question that he would have had the right to prosecute his
application before the commission to its final conclusion. No one would have denied him that right. As declared
by the commission in its decision, he had invested in the ice plant in question P 35,000, and from what the
commission said regarding his other properties and business, he would certainly have been financially able to
maintain and operate said plant had he not died. His transportation business alone was netting him about P1,440
a month. He was a Filipino citizen and continued to be such till his demise. The commission declared in its
decision, in view of the evidence before it, that his estate was financially able to maintain and operate the ice
plant. The aforesaid right of Pedro O. Fragante to prosecute said application to its conclusion was one which by
its nature did not lapse through his death. Hence, it constitutes a part of the assets of his estate, for which a right
was property despite the possibility that in the end the commission might have denied application, although
under the facts of the case, the commission granted the application in view of the financial ability of the estate
to maintain and operate the ice plant. Petitioner, in his memorandum of March 19, 1947, admits (page 3) that
the certificate of public convenience once granted "as a rule, should descend to his estate as an asset". Such
certificate would certainly be property, and the right to acquire such a certificate, by complying with the
requisites of the law, belonged to the decedent in his lifetime, and survived to his estate and judicial
administrator after his death.

If Pedro O. Fragrante had in his lifetime secured an option to buy a piece of land and during the life of the
option he died, if the option had been given him in the ordinary course of business and not out of special
consideration for his person, there would be no doubt that said option and the right to exercise it would have
survived to his estate and legal representatives. In such a case there would also be the possibility of failure to
acquire the property should he or his estate or legal representative fail to comply with the conditions of the
option. In the case at bar Pedro O. Fragrante's undoubted right to apply for and acquire the desired certificate of
public convenience the evidence established that the public needed the ice plant was under the law
conditioned only upon the requisite citizenship and economic ability to maintain and operate the service. Of
course, such right to acquire or obtain such certificate of public convenience was subject to failure to secure its
objective through nonfulfillment of the legal conditions, but the situation here is no different from the legal
standpoint from that of the option in the illustration just given.

Rule 88, section 2, provides that the executor or administrator may bring or defend actions, among other cases,
for the protection of the property or rights of the deceased which survive, and it says that such actions may be
brought or defended "in the right of the deceased".
Rule 82, section 1, paragraph (a), mentions among the duties of the executor or administrator, the making of an
inventory of all goods, chattels, rights, credits, and estate of the deceased which shall come to his possession or
knowledge, or to the possession of any other person for him.

In his commentaries on the Rules of Court (Volume II, 2nd ed., pages 366, 367) the present chief Justice of this
Court draws the following conclusion from the decisions cited by him:

Therefore, unless otherwise expressly provided by law, any action affecting the property or rights(emphasis
supplied) of a deceased person which may be brought by or against him if he were alive, may likewise be
instituted and prosecuted by or against the administrator, unless the action is for recovery of money, debt or
interest thereon, or unless, by its very nature, it cannot survive, because death extinguishes the right . . . .

It is true that a proceeding upon the application for a certificate of public convenience before the Public Service
Commission is not an "action". But the foregoing provisions and citations go to prove that the decedent's rights
which by their nature are not extinguished by death go to make up a part and parcel of the assets of his estate
which, being placed under the control and management of the executor or administrator, can not be exercised
but by him in representation of the estate for the benefit of the creditors, devisees or legatees, if any, and the
heirs of the decedent. And if the right involved happens to consist in the prosecution of an unfinished
proceeding upon an application for a certificate of public convenience of the deceased before the Public Service
Commission, it is but logical that the legal representative be empowered and entitled in behalf of the estate to
make the right effective in that proceeding.

Manresa (Vol. III, 6th ed., p. 11) says that No. 10 of article 334 and article 336 of the Civil Code, respectively,
consider as immovable and movable things rights which are not material. The same eminent commentator says
in the cited volume (p. 45) that article 336 of the Civil Code has been deficiently drafted in that it is not
sufficiently expressive of all incorporeal rights which are also property for juridical purposes.

Corpus Juris (Vol. 50, p. 737) states that in the broad sense of the term, property includes, among other things,
"an option", and "the certificate of the railroad commission permitting the operation of a bus line", and on page
748 of the same volume we read:

However, these terms (real property, as estate or interest) have also been declared to include every species of
title, inchoate or complete, and embrace rights which lie in contract, whether executory or executed. (Emphasis
supplied.)

Another important question raised by petitioner is whether the estate of Pedro O. Fragrante is a "person" within
the meaning of the Public Service Act.

Words and Phrases, First Series, (Vol. 6, p, 5325), states the following doctrine in the jurisdiction of the State of
Indiana:

As the estate of the decedent is in law regarded as a person, a forgery committed after the death of the man
whose name purports to be signed to the instrument may be prosecuted as with the intent to defraud the estate.
Billings vs. State, 107 Ind., 54, 55, 6 N. E. 914, 7 N. E. 763, 57 Am. Rep. 77.

The Supreme Court of Indiana in the decision cited above had before it a case of forgery committed after the
death of one Morgan for the purpose of defrauding his estate. The objection was urged that the information did
not aver that the forgery was committed with the intent to defraud any person. The Court, per Elliott, J.,
disposed of this objection as follows:
. . . The reason advanced in support of this proposition is that the law does not regard the estate of a decedent as
a person. This intention (contention) cannot prevail. The estate of the decedent is a person in legal
contemplation. "The word "person" says Mr. Abbot, "in its legal signification, is a generic term, and includes
artificial as well as natural persons," 2 Abb. Dict. 271; Douglas vs. Pacific, etc. Co., 4 Cal. 304; Planters', etc.,
Bank vs. Andrews, 8 Port. (Ala.) 404. It said in another work that 'persons are of two kinds: natural and
artificial. A natural person is a human being. Artificial persons include (1) a collection or succession of natural
persons forming a corporation; (2) a collection of property to which the law attributes the capacity of having
rights and duties. The latter class of artificial persons is recognized only to a limited extent in our law.
"Examples are the estate of a bankrupt or deceased person." 2 Rapalje & L. Law Dict. 954. Our own cases
inferentially recognize the correctness of the definition given by the authors from whom we have quoted, for
they declare that it is sufficient, in pleading a claim against a decedent's estate, to designate the defendant as the
estate of the deceased person, naming him. Ginn vs. Collins, 43 Ind. 271. Unless we accept this definition as
correct, there would be a failure of justice in cases where, as here, the forgery is committed after the death of a
person whose name is forged; and this is a result to be avoided if it can be done consistent with principle. We
perceive no difficulty in avoiding such a result; for, to our minds, it seems reasonable that the estate of a
decedent should be regarded as an artificial person. It is the creation of law for the purpose of enabling a
disposition of the assets to be properly made, and, although natural persons as heirs, devises, or creditors, have
an interest in the property, the artificial creature is a distinct legal entity. The interest which natural persons
have in it is not complete until there has been a due administration; and one who forges the name of the
decedent to an instrument purporting to be a promissory note must be regarded as having intended to defraud
the estate of the decedent, and not the natural persons having diverse interests in it, since ha cannot be presumed
to have known who those persons were, or what was the nature of their respective interest. The fraudulent intent
is against the artificial person, the estate and not the natural persons who have direct or contingent interest
in it. (107 Ind. 54, 55, 6 N.E. 914-915.)

In the instant case there would also be a failure of justice unless the estate of Pedro O. Fragrante is considered a
"person", for quashing of the proceedings for no other reason than his death would entail prejudicial results to
his investment amounting to P35,000.00 as found by the commission, not counting the expenses and
disbursements which the proceeding can be presumed to have occasioned him during his lifetime, let alone
those defrayed by the estate thereafter. In this jurisdiction there are ample precedents to show that the estate of a
deceased person is also considered as having legal personality independent of their heirs. Among the most
recent cases may be mentioned that of "Estate of Mota vs. Concepcion, 56 Phil., 712, 717, wherein the principal
plaintiff was the estate of the deceased Lazaro Mota, and this Court gave judgment in favor of said estate along
with the other plaintiffs in these words:

. . . the judgment appealed from must be affirmed so far as it holds that defendants Concepcion and Whitaker
are indebted to he plaintiffs in the amount of P245,804.69 . . . .

Under the regime of the Civil Code and before the enactment of the Code of Civil Procedure, the heirs of a
deceased person were considered in contemplation of law as the continuation of his personality by virtue of the
provision of article 661 of the first Code that the heirs succeed to all the rights and obligations of the decedent
by the mere fact of his death. It was so held by this Court in Barrios vs. Dolor, 2 Phil., 44, 46. However, after
the enactment of the Code of Civil Procedure, article 661 of the Civil Code was abrogated, as held in Suiliong &
Co. vs. Chio-Taysan, 12 Phil., 13, 22. In that case, as well as in many others decided by this Court after the
innovations introduced by the Code of Civil Procedure in the matter of estates of deceased persons, it has been
the constant doctrine that it is the estate or the mass of property, rights and assets left by the decedent, instead of
the heirs directly, that becomes vested and charged with his rights and obligations which survive after his
demise.

The heirs were formerly considered as the continuation of the decedent's personality simply by legal fiction, for
they might not have been flesh and blood the reason was one in the nature of a legal exigency derived from
the principle that the heirs succeeded to the rights and obligations of the decedent. Under the present legal
system, such rights and obligations as survive after death have to be exercised and fulfilled only by the estate of
the deceased. And if the same legal fiction were not indulged, there would be no juridical basis for the estate,
represented by the executor or administrator, to exercise those rights and to fulfill those obligations of the
deceased. The reason and purpose for indulging the fiction is identical and the same in both cases. This is why
according to the Supreme Court of Indiana in Billings vs. State, supra, citing 2 Rapalje & L. Dictionary, 954,
among the artificial persons recognized by law figures "a collection of property to which the law attributes the
capacity of having rights and duties", as for instance, the estate of a bankrupt or deceased person.

Petitioner raises the decisive question of whether or not the estate of Pedro O. Fragrante can be considered a
"citizen of the Philippines" within the meaning of section 16 of the Public Service Act, as amended, particularly
the proviso thereof expressly and categorically limiting the power of the commission to issue certificates of
public convenience or certificates of public convenience and necessity "only to citizens of the Philippines or of
the United States or to corporations, copartnerships, associations, or joint-stock companies constituted and
organized under the laws of the Philippines", and the further proviso that sixty per centum of the stock or paid-
up capital of such entities must belong entirely to citizens of the Philippines or of the United States.

Within the Philosophy of the present legal system, the underlying reason for the legal fiction by which, for
certain purposes, the estate of the deceased person is considered a "person" is the avoidance of injustice or
prejudice resulting from the impossibility of exercising such legal rights and fulfilling such legal obligations of
the decedent as survived after his death unless the fiction is indulged. Substantially the same reason is assigned
to support the same rule in the jurisdiction of the State of Indiana, as announced in Billings vs. State, supra,
when the Supreme Court of said State said:

. . . It seems reasonable that the estate of a decedent should be regarded as an artificial person. it is the creation
of law for the purpose of enabling a disposition of the assets to be properly made . . . .

Within the framework and principles of the constitution itself, to cite just one example, under the bill of rights it
seems clear that while the civil rights guaranteed therein in the majority of cases relate to natural persons, the
term "person" used in section 1 (1) and (2) must be deemed to include artificial or juridical persons, for
otherwise these latter would be without the constitutional guarantee against being deprived of property without
due process of law, or the immunity from unreasonable searches and seizures. We take it that it was the
intendment of the framers to include artificial or juridical, no less than natural, persons in these constitutional
immunities and in others of similar nature. Among these artificial or juridical persons figure estates of deceased
persons. Hence, we hold that within the framework of the Constitution, the estate of Pedro O. Fragrante should
be considered an artificial or juridical person for the purposes of the settlement and distribution of his estate
which, of course, include the exercise during the judicial administration thereof of those rights and the
fulfillment of those obligations of his which survived after his death. One of those rights was the one involved
in his pending application before the Public Service Commission in the instant case, consisting in the
prosecution of said application to its final conclusion. As stated above, an injustice would ensue from the
opposite course.
How about the point of citizenship? If by legal fiction his personality is considered extended so that any debts
or obligations left by, and surviving, him may be paid, and any surviving rights may be exercised for the benefit
of his creditors and heirs, respectively, we find no sound and cogent reason for denying the application of the
same fiction to his citizenship, and for not considering it as likewise extended for the purposes of the aforesaid
unfinished proceeding before the Public Service Commission. The outcome of said proceeding, if successful,
would in the end inure to the benefit of the same creditors and the heirs. Even in that event petitioner could not
allege any prejudice in the legal sense, any more than he could have done if Fragrante had lived longer and
obtained the desired certificate. The fiction of such extension of his citizenship is grounded upon the same
principle, and motivated by the same reason, as the fiction of the extension of personality. The fiction is made
necessary to avoid the injustice of subjecting his estate, creditors and heirs, solely by reason of his death to the
loss of the investment amounting to P35,000, which he has already made in the ice plant, not counting the other
expenses occasioned by the instant proceeding, from the Public Service Commission of this Court.

We can perceive no valid reason for holding that within the intent of the constitution (Article IV), its provisions
on Philippine citizenship exclude the legal principle of extension above adverted to. If for reasons already stated
our law indulges the fiction of extension of personality, if for such reasons the estate of Pedro O. Fragrante
should be considered an artificial or juridical person herein, we can find no justification for refusing to declare a
like fiction as to the extension of his citizenship for the purposes of this proceeding.

Pedro O. Fragrante was a Filipino citizen, and as such, if he had lived, in view of the evidence of record, he
would have obtained from the commission the certificate for which he was applying. The situation has suffered
but one change, and that is, his death. His estate was that of a Filipino citizen. And its economic ability to
appropriately and adequately operate and maintain the service of an ice plant was the same that it received from
the decedent himself. In the absence of a contrary showing, which does not exist here, his heirs may be assumed
to be also Filipino citizens; and if they are not, there is the simple expedient of revoking the certificate or
enjoining them from inheriting it.

Upon the whole, we are of the opinion that for the purposes of the prosecution of said case No. 4572 of the
Public Service Commission to its final conclusion, both the personality and citizenship of Pedro O. Fragrante
must be deemed extended, within the meaning and intent of the Public Service Act, as amended, in harmony
with the constitution: it is so adjudged and decreed.

Decision affirmed, without costs. So ordered.

Moran, C.J., Pablo, Bengzon, Briones, Padilla and Tuason, JJ., concur.
Paras, J., I hereby certify that Mr. Justice Feria voted with the majority.

Separate Opinions

PERFECTO, J., dissenting:

Commonwealth Act No. 146 reserves to Filipino citizens the right to obtain a certificate of public convenience
to operate an ice plant in San Juan, Rizal. The limitation is in accordance with section 8 of Article XIV of the
Constitution which provides
No franchise, certificate, or any other form of authorization for the operation of a public utility shall be granted
except to citizens of the Philippines or to corporations or other entities organized under the laws of the
Philippines, sixty per centum of the capital of which is owned by citizens of the Philippines, nor such franchise,
certificate or authorization be exclusive in character or for a longer period than fifty years. No franchise granted
to any individual, firm or corporation, except under the condition that it shall be subject to amendment,
alteration, or repeal by Congress when the public interest so requires.

The main question in this case is whether the estate of Pedro O. Fragrante fulfills the citizenship requirement.
To our mind, the question can be restated by asking whether the heirs of Pedro O. Fragrante fulfill the
citizenship requirement of the law.

The estate is an abstract entity. As such, its legal value depends on what it represents. It is a device by which the
law gives a kind of personality and unity to undetermined tangible persons, the heirs. They inherit and replace
the deceased at the very moment of his death. As there are procedural requisites for their identification and
determination that need time for their compliance, a legal fiction has been devised to represent them. That legal
fiction is the estate, a liquid condition in process of solidification.

The estate, therefore, has only a representative value. What the law calls estate is, a matter of fact, intended to
designate the heirs of the deceased. The question, therefore, in this case, boils down to the citizenship of the
heirs of Fragrante.

There is nothing in the record to show conclusively the citizenship of the heirs of Fragrante. If they are Filipino
citizens, the action taken by the Public Service Commission should be affirmed. If they are not, it should be
reversed.

Petitioner alleges that the estate is just a front or dummy for aliens to go around the citizenship constitutional
provision. It is alleged that Gaw Suy, the special administrator of the estate, is an alien.

We are of the opinion that the citizenship of the heirs of Fragrante should be determined by the Commission
upon evidence that the party should be present. It should also determine the dummy question raised by the
petitioner.

We are of opinion and so vote that the decision of the Public Service Commission of May 21, 1946, be set aside
and that the Commission be instructed to receive evidence of the above factual questions and render a new
decision accordingly.

G.R. No. 559 March 14, 1903

MANUEL BARRIOS Y BARREDO,Plaintiff-Appellant, vs. MARIA PASCUALA DOLOR, ET
AL.,Defendants-Appellees.

Simplicio del Rosario, for appellant.

Maria Pascuala Dolor, appellee.

MAPA, J.:

The plaintiff has brought an action for the recovery from the defendants, heirs of the late Don Ciriaco
Demonteverde, of one-half of a sugar estate and the stock thereon, which he claims to have purchased from the
said Don Ciriaco Demonteverde. In support of his contention as to the law of the case he attached to the
complaint a public instrument which appears to have been executed by himself and Demonteverde, February 3,
1883, in which, according to the plaintiff, a stipulation is made for a contract of partnership for the operation of
the said estate, and, furthermore, a community, of ownership is established with respect to the estate in favor of
the two parties to this instrument. It does not appear that this instrument has been recorded in the registry of
property.chanrobles virtual law library

Service of the complaint having been had on the defendants, Doa Maria Pascuala Dolor raised an incidental
issue as a previous question, praying that the instrument referred to be ruled out of evidence on the ground that
it had not been recorded in the registry of property, and that it be returned to the plaintiff without leaving in the
record any transcript or copy thereof or extract therefrom, resting this contention upon article 389 of the
Mortgage Law. This motion was granted by the judge by order of the 24th of March, 1898, against which the
plaintiff appeals.chanrobles virtual law library

The article cited is literally as follows: "From the time this law goes into operation the ordinary and special
courts and the Government offices will not admit any document or instrument by which rights subject to
inscription according to this law are constituted, transmitted, acknowledged, modified, or extinguished, unless
recorded in the register, if the object of the presentation of such document is to enforce, to the prejudice of a
third person, a right which should have been recorded."chanrobles virtual law library

In view of the latter part of this article, the question has been raised in this incidental issue whether the
defendants, as heirs of Don Ciriaco Demonteverde, can and should be regarded as third persons for the purposes
of the Mortgage Law, with respect to the contract executed by Demonteverde and evidenced by the instrument
above mentioned.chanrobles virtual law library

The Mortgaged Law itself, in article 27, gives the definition of a third person, which is, "he who has not taken
part in the act or contract recorded." chanrobles virtual law library

According to this parties to a contract are not third persons; consequently, Demonteverde was not a third person
with respect to the contract entered into by him and evidenced by the instrument in question. He not being such
a third person, neither can his heirs be so regarded, nor should they be so regarded with respect to the same
contract, because they are only the judicial continuation of his personality, they having been subrogated, by
virtue of the right of succession, to all his rights and obligations, in accordance with provisions of article 661 of
the Civil Code.chanrobles virtual law library

This doctrine, which is a mere consequence of the general principles of law, has received express sanction, in
the decisions of the supreme court of Spain. In its judgment of the 27th of January, 1881, the latter held that
acts, both in court and out, consented to by the person who lawfully took part therein, are effective with respect
to the heirs or successors of such parties, who are not be regarded as third persons for this purpose; and in its
judgment of the 28th of January, 1892, it was decided by the same court that heirs are nothing more than the
continuation of the legal personality of their decedent and can not be considered in any degree as third persons
within the meaning of article 27 of the Mortgage Law.chanrobles virtual law library

The defendants, therefore, are not third persons with respect to the contract entered into by their decedent, Don
Ciriaco Demonteverde, in the instrument of February 3, 1883, and they therefore can not avail themselves of the
prohibition contained in article 389 of the Mortgage Law for the purpose of opposing the admission of this
instrument as evidence in the case, because not recorded in the registry of property. This prohibition was
established solely and exclusively in favor of those who, within the meaning of that law, are third persons. Were
it otherwise, the position of the defendants would be superior to that of the person whom they derived their
rights, because he, not being a third person, could not set up such an exception. This would certainly be most
illogical from a legal point of view, in view of the fact that the heir is, as above stated, a mere continuation of
the civil personality of his decedent.chanrobles virtual law library

The defendants not being third persons, it becomes unnecessary to decide whether the instrument referred to is
or is not subject to inscription in accordance with article 2 of the Mortgage Law, because, at all events, and
however this may be, the mere failure to record the instrument in the registry of property can not be a bar to its
admission as evidence in this case, as the action is not brought against a third person in the sense of this word as
used in the law referred to.chanrobles virtual law library

Consequently we reverse and annul the order of the court below, overruling the motion made on behalf of Doa
Maria Pascuala Dolor, without special condemnation as to the costs of either instance. So ordered.chanrobles
virtual law library

Arellano, C.J., Cooper, Willard and Ladd, JJ., concur.

Torres, J., did not sit in this case.

G.R. No. L-4777 November 11, 1908

SUILIONG & CO., as liquidators of The Yek Tong Lim Fire, Marine, and Insurance Co., Ltd., plaintiffs-
appellees,
vs.
SILVINA CHIO-TAYSAN, defendant-FRANCISCA JOSE, intervener-appellant.

Leodegario Azarraga, for appellant.

Carlos Ledesma, and Ramon Fernandez, for appellees.
CARSON, J.:

Avelina Caballero, deceased, owned during her lifetime a certain tract of land, which was duly inscribed in her
name in the land registry of the city of Manila. On March 27, 1903, she borrowed from Francisca Jose, the
intervener and appellant in this action, 1,000 pesos, Mexican currency, and turned over her title deeds to this
tract of land to the lender as security for the loan, but no entry touching the transaction was noted in the land
registry.

Avelina Caballero died on the 5th day of June, 1903, and thereafter Silvina Chio-Taysan, the defendant in this
action, instituted in the Court of First Instance of Manila an action, known, under the system of civil procedure
in existence prior to the adoption of the present code, as an "action for the declaration of heirship" and on the
5th day of August, 1903, the following order declaring her to be the only and exclusive heir of Avelina
Caballero, deceased, was issued in that proceeding:

[United States of America, Philippine Islands. In the Court of First Instance of Manila. Part III.]

It having been proven by both documental and oral evidence introduced in the above-cited case, that the
petitioner Silvina Chio-Taysan y Caballero is the daughter of Jose Chio-Taysan and Avelina Caballero, who
died on the 29th of April, 1895, and on the 5th of June, 1903, respectively, without leaving any other
descendant or having executed any will; and there being no objection whatever to the claim of the petitioner, it
is hereby declared that the said Silvina Chio-Taysan y Caballero is the legal heir abintestato of her deceased
parents, the said Jose Chio-Taysan and Avelina Caballero, in conformity with the provisions of the Civil Code
now in force. Let a certificate of this decision be issued to the interested party and those who may hereafter
apply for the same. So ordered.

A.S. CROSSFIELD, Judge.

On March 9, 1904, the registrar of deeds of the city of Manila by virtue of this order entered the following
inscription in the land registry whereby the said Silvina Chio-Taysan is made to appear as the owner of the land
in question:

Ninth inscription. Urban property. A parcel of land and a house of a strong materials, tile roofed, built
thereon, marked number eight, situated in Calle Lavezares of the district of Binondo, this city, the remaining
description of which appears in the first inscription of this number. It has no encumbrances. Doa Avelina
Caballero y Bugnot, of age, widow, of this vicinity, is the owner of this property under a title of repurchase,
according to the proceeding inscription. Said lady and her husband, Don Jose Chio-Taysan, died on June 5,
1903, and April 29, 1895, respectively, and neither of them having executed a will, the corresponding intestate
proceedings were instituted, in which an order was issued on August 5, 1903, by A.S. Crossfield, judge of the
third sala of the Court of First Instance of this city, declaring their daughter, Silvina Chio-Taysan y Caballero,
their intestate heir. By virtue thereof, I inscribe, in favor of the said Silvina Chio-Taysan y Caballero, the right
she was acquired over the property of this number, under title by intestate inheritance. All the above appears
from the previous records and from the copy of the above judicial order, issued by Don Salvador Chofre,
assistant clerk of the Court of First Instance of this city, on August 5, 1903, which document was presented to
this registry at 8:50 a. m. on the 25th day of February last, as per record No. 452, page 266, of the 7th volume of
the Diario. And all the above being in accordance with the document above referred to, I sign these presents in
Manila, on March 9, 1904 Fees: $7.50, No. 7, Tariff of Fees. Alberto Barretto.
On the 26th day of May, 1904, the said Silvina Chio-Taysan borrowed the sum of P2,500 from the Fire and
Marine Insurance and Loan Co., of which the plaintiff is the lawfully appointed liquidator, and mortgaged the
land in question as security for the repayment of the loan.

Thereafter the husband of Silvina Chio-Taysan instituted special proceedings under the provisions of the present
Code of Civil Procedure, for the administration of the estate of Avelina Caballero, deceased, and on the 16th
day of October, 1905, he was, in accordance with his petition, appointed administrator; and thereupon,
submitted as such administrator, an inventory of the property of the estate, in which was included the land in
question; and on the 28th of November, 1905, Francisca Jose, the intervener in this action, submitted her claim
to the commissioner appointed in these proceedings, for the sum of 1,000 pesos, Mexican currency, loaned the
deceased, as above set out, on the 28th day of March, 1904, which claim was duly approved on the 31st of
August, 1906.

On the 10th day of October, 1906, the plaintiff in this action filed its complaint against the defendant, Silvina
Chio-Taysan, praying for judgment for the amount loaned her as above set out, and the foreclosure of its
mortgage upon the land. To this complaint the defendant, Silvina Chio-Taysan, filed her answer, admitting the
facts alleged in the complaint and declining to interpose any objection to the prayer of the complaint; but on the
30th of October, 1907, Francisca Jose was permitted to intervene and file her separate "complaint in
intervention" wherein she set out the facts touching the loan made by her to Avelina Caballero, deceased, and
prayed that the court declare the mortgage executed by Silvina Chio-Taysan rescinded and of no effect; and
further that it annul the inscription in the land registry of the title of Silvina Chio-Taysan to the land in question;
and declare this land subject to her claim against the estate of Avelina Caballero, deceased. lawphil.net

The trial court entered judgment in favor of the plaintiff and against both the defendant and the intervener in
conformity with the prayer of the complaint, and the intervener brings that judgment before this court for review
upon her bill of exceptions duly signed and certified.

We do not think that the judgment of the trial court can be sustained in so far as it wholly denies relief to the
intervener, Francisca Jose. The trial judge denied the relief prayed for by the intervener, on the ground that her
intervention in this action was for the purpose of the written title deeds on the land, and that, since she admitted
that she had admitted her claim against the estate of Avelina Caballero, deceased, to the committee appointed in
the administration proceedings, she must be taken to have abandoned, whatever lien she may have held as
security therefor, in accordance with the provisions of section 708 of the Code of Civil Procedure.

The prayer of her complaint in intervention, however, is merely for the rescission and annulment of the
mortgage contract between the loan company and the defendant and of the inscription in the land registry of the
title of the defendant, and a declaration that as a creditor of the estate she has a superior right to that of the
plaintiff company in the proceeds of any sale of the land in question. She does not seek to enforce her claim and
recover her debt in this proceeding, but merely to prevent the plaintiff from securing a judgment in this action
which would take out of the estate property which she believes to be subject to her claim set up in the
administration proceedings. If her contentions are well founded, and if the estate of the deceased is subject to
the payment of the debts of the deceased in such form that the heirs of the deceased could not alienate this land
free of the claims of the creditors of the deceased against the land, for the payment of their claims against the
deceased, the intervener is clearly entitled to at least so much of the relief she seeks in this action as will have
the effect of preventing the sale of this land under the plaintiff's foreclosure proceedings, free of the claims of
creditors of the deceased, because, if the plaintiffs in this action were permitted to foreclosure their mortgage
and to recover their debt from the sale of the land in question, it might well be that there would not be sufficient
property in the estate to pay the amount of the claim of the intervener against the estate.

Had the transactions above set out in taken place under the system of law in force in these Islands immediately
prior to the 1st day of October, 1901, when the new Code of Civil Procedure went into effect, there would be no
difficulty in determining the respective rights of the various parties to this action. Article 657 of the Civil Code
provides that Los derechos a la succession de una persona se transmiten desde el momento de su muerte. (The
rights to the succession of another are transmitted from the moment of his death); and article 661 provides
thatLos herederos suceden al difunto por el hecho solo de su muerte en todos sus derechos y
obligaciones. (Heirs succeed the deceased by the mere fact of his death, in all rights and obligations). Under
these, and co-related provisions of the Civil Code, a sole and exclusive heir (as defined in article 660 of the
Civil Code) became the owner of the property and was charged with the obligations of the deceased at the
moment of his death, upon precisely the same terms and conditions as the property was held and as the
obligations had been incurred by the deceased prior to his death, save only that when he accepted the
inheritance, "with benefit of an inventory" he was not held liable for the debts and obligations of the deceased
beyond the value of the property which came into his hands.

The property of the deceased, both real and personal, became the property of the heir by the mere fact of death
of his prodecessor in interest, and he could deal with it in precisely the same way in which the deceased could
have dealt with it, subject only to the limitations which by law or by contract were imposed upon the deceased
himself. He could alienate or mortgage it with the same freedom as could the deceased in his lifetime; the
unsecured debts and other personal obligations of the deceased becoming the unsecured debts and personal
obligations of the heir for which he was held personally responsible in precisely the same manner as the
deceased, save only, as has been said before, where he availed himself of the privilege of taking the estate "with
the benefit of an inventory," in which case the extent of his liability was limited to the value of the estate which
came into his hands, though in other respects its character as a personal liability remained unchanged. Thus
death created no new lien in favor of creditors upon the property of the deceased, which was not in existence at
the time of his death; personal debts and obligations of the deceased becoming the personal debts and
obligations of the heir, to whom the creditor was compelled to look for payment, with no new right in or to the
property of the decease, in the hands of the heir, which he did not have in or to such property in the hands of the
deceased. (Title 3, Book of the Civil Code.)

Spanish procedural law provided an action known as an action for the declaration of heirship (declaracion de
herederos) whereby one claiming the status of heir could have his right thereto judicially declared, and this
judicial declaration of heirship unless and until set aside or modified in a proper judicial proceeding, was
evidence of the fact of heirship which the officials charged with the keeping of the public records, including the
land registry, were bound to accept as a sufficient basis for the formal entry, in the name of the heir, of
ownership of the property of the deceased.

It is evident therefore that, unless the provisions of Spanish procedural and substantive law, in force when the
new Code of Civil Procedure went into effect, have been repealed or modified thereby, the defendant in this
action, Silvina Chio-Taysan, who was judicially declared to be the sole and universal heir of Avelina Caballero,
deceased, became, by the mere fact of the death of Caballero, the absolute owner of the tract of land in question,
subject only to such liens thereon as may have existed prior thereto, the personal obligations of the deceased
also passing to her at the same time; that, upon proof of such judicial declaration of heirship, the register of
deeds of the city of Manila properly entered Chio-Taysan in the land registry as the owner of this land by right
of inheritance; and that the Loan Company, of which the plaintiffs are the duly appointed liquidators, was
entitled to rely on the properly noted entries in the land registry and that the company's mortgage deed from
Chio-Taysan, in whose name the land is registered, could not be affected by the unrecorded claim of the
indebtedness of the intervener, who must look to the heirs for the recovery of her debt.

But both the substantive and procedural law touching rights of succession and their enforcement, which were in
force in these Islands when the new Code of Civil Procedure went into effect, have, to a greater or less degree,
been repealed or modified by its enactment; and we are of opinion that, under the provisions of the new code,
the heir is not a such personally responsible for the debts of the deceased, in whole or in part; and on the other
hand, the property of the deceased comes to him charged with the debts of the deceased, so that he can not
alienate or charge it free of such debts, until and unless they are extinguished either by payment, prescription, or
satisfaction in one or other of the modes recognized by law.

It must be admitted that we can not point out the specific section of the new Code of Civil Procedure which in
express terms repeals the old law and formally enacts the new doctrine of succession just laid down; but we
think that an examination of the various provisions of that code touching the administration of the estates of
deceased person leaves no room for doubt that they do so by necessary implication.

The legislators who enacted this code were more especially acquainted with the American and English systems
of legislation, and in most of its provisions closely adhered to American precedent. It substantially repeals in
toto the proceedings prescribed under the old law for the administration of estates of deceased persons, and
substitutes therefor a system similar to that generally adopted in the United States; most of its provisions having
been borrowed word for word from the codes of one or other of the various States. The substantive law in force
in these Islands being in many respects, and especially in regard to rights of inheritance, wholly different from
that in force in the various States from which the new system of administration of the estates of deceased
persons was adopted, many irreconcilable conflicts are to be found between the provisions of the new and the
old law, so that it becomes necessary either to declare a great part of the provisions of the new Code of
Procedure void and no effect, as wholly inapplicable, or to hold that in such cases the provisions of substantive
as well as procedural law in conflict or inconsistent with the provisions of the new Code of Procedure are
repealed, or amended by the substitution of such other provisions as are clearly necessary as a basis upon which
the new provisions of procedural law are predicated.

An examination more especially of sections 597, 644, 695, 727, 729, 731, 733, and 749 of the Code of Civil
Procedure, read together with the remaining provisions for the administration of the estates of deceased persons,
clearly indicates that the provisions of articles 660 and 661 of the Civil Code have been abrogated.

These provisions of the new code clearly demonstrate that the terms heredero and legatario, as defined in the
Civil Code (art. 660), are not synonymous with the words "heir" and "legatee," as used in the new code; the
word "heir" in the new code being technically and applicable only to a relative taking property of an intestate by
virtue of the laws of descent, devisee and legatee being reserved for all persons whether relatives or not, taking
respectively real or personal property by virtue of a will; while heredero in the Civil Code was applicable not
only to one who would be called an "heir," under the provisions of the new code, but also to one, whether
relative or not, who took what might be called "a residuary estate under a will" (el que sucede a titulo
universal).

It appears also from an examination of these provisions that the legislature has provided no machinery whereby
an absolute right on the part of the heir to succeed by the mere fact of death to all the rights and property of the
deceased may be enforced, without previous payment or provision of the payment of the debts; and on the other
hand, it has provided machinery for the enforcement of the debts and other obligations of the deceased, not as
debts or obligations of the heir, but as debt or obligations of the deceased, to the payment of which the property
of the deceased may be subjected wherever it be found. Thus section 597 expressly provides that, in those cases
where settlement of an intestate estate may be made without legal proceedings, either by a family council, as
known under the Spanish law, or by an agreement in writing executed by all the heirs, the real estate of the
deceased remains charged with liability to creditors of the deceased for two years after the settlement,
"notwithstanding any transfers thereof that may have been made;" and we think the inference is clear that the
legislator in this section recognizes and affirms the doctrine that, prior to the date of such settlement, the real
estate at least was charged in like manner with the debts of the deceased. So it will be found that, where the
legal proceedings are had looking to the settlement of testate or intestate estates, provision is made for the
recovery of claims against the deceased, not by proceedings directed against the heir, but by proceedings
looking directly to the subjection of the property of the deceased to the payment of such claims; the property
both real and personal being, in express terms, made chargeable with the payment of these debts, the executor
or administrator having the right to the possession of the real as well as the personal property, to the exclusion
of the heirs, so long as may be necessary for that purpose (secs. 727 and 729).

For practical purposes it may well be said that in the eye of the law, where there is no remedy to enforce an
alleged right when it is invaded, the existence of the right may safely be denied; and where the law furnishes a
remedy whereby one may enforce a claim, that claim is a right recognized and established by the law. The new
Code of Procedure furnishing no remedy whereby the provisions of article 661 of the of the Civil Code may be
enforced, in so far as they impose upon the heredero (heir) the duty of assuming as a personal obligation all the
debts of the deceased, at least to the extent of the value of the property received from the estate; or in so far as
they give to the heredero the reciprocal right to receive the property of the deceased, without such property
being specifically subjected to the payment of the debts to the deceased by the very fact of his deceased, these
provisions of article 661 may properly be held to have been abrogated; and the new code having provided a
remedy whereby the property of the deceased may always be subjected to the payment of his debts in whatever
hands it may be found, the right of a creditor to a lien upon the property of the deceased, for the payment of the
debts of the deceased, created by the mere fact of his death, may be said to be recognized and created by the
provisions of the new code. (Pavia vs. De la Rosa, 8 Phil. Rep., 70).

It is evident, therefore, that a judgement in an action for the declaration of heirship in favor of one or more heirs
could not entitle such persons to be recognized as the owner or owners of the property of the deceased on the
same terms as such property was held by the deceased, for it passes to the heir, under the new code, burdened
with all the debts of the deceased, his death having created a lien thereon for the benefit of creditor; and indeed
an examination of the proceedings prescribed in the new Code of Civil Procedure for the administration and
distribution of the estates of deceased persons leaves no room for doubt that those proceedings are exclusive of
all other judicial proceedings looking to that end, and supersede the judicial proceeding for the declaration of
heirship, as recognized in the old procedure, at least so far as that proceeding served as a remedy whereby the
right of specific persons to succeed to the rights and obligations of the deceased as his heirs might be judicially
determined and enforced.

Examining the facts in the case at bar, in the light of the doctrine as to the law of succession as thus modified
and amended by the new Code of Civil Procedure, which went into effect prior to the death of Avelina
Caballero, it is evident that her death created a lien upon her property in favor of the intervener Francisca Jose,
for the payment of the debt contracted by her during her lifetime, and that this lien ought to have and has
priority to any lien created upon this property by the heir of the deceased; that the judicial declaration of
heirship in favor of Silvina Chio-Taysan, could not and did not furnish a basis for an entry in the land registry of
the name of Silvina Chio-Taysan as the absolute owner of the property of Avelina Caballero; that such entry,
improperly made, could not and did not prejudice the lien of the intervener, Francisca Jose, for the debt due her
by the deceased (Mortgage Law, art. 33); and that the mortgage of the property of the deceased by her heir,
Silvina Chio-Taysan, was subject to the prior lien of the intervener, Francisca Jose, for the payment of her debt.

It is not necessary for us to consider the action of the court below in ordering the foreclosure of the mortgage, in
so far as it affects the defendant Silvina Chio-Taysan who did not appeal; but we think that the intervener, who
is seeking to subject the property of the deceased to the payment of her debt in the administration proceedings
now pending, is clearly entitled to so much of the relief prayed for as will have the effect of preventing the
application of the proceeds of the sale of this land under foreclosure proceedings to the payment of debts
contracted by the heir until and unless it shall appear that the residue of the estate of the deceased is sufficient to
satisfy her claim. Such provision for the protection of her rights having been made, the other relief prayed for
by her may properly be denied, since a provision subjecting the land in question to the payment of her claim
against the estate of Avelina Caballero, deceased, fully and sufficiently protects her rights in the premises, and
her rights having been secured, she has no proper interest in the rescission of the mortgage contract between
plaintiff and defendant, or the cancellation of the inscription of the defendant's title as heir in the land registry.

The judgment of the trial court should, therefore, be modified in accordance with the foregoing principles, and
the record will be returned to the trial court where judgment will be entered modifying the judgment, by
providing that the proceeds of the sale of the land under the foreclosure proceedings will be deposited with the
clerk of the court, where it will be retained until the amount of the debt due the intervener and unpaid in the
course of the administration of the estate of Avelina Caballero shall have been ascertained, whereupon the said
funds shall be applied: first, to extinguish the unpaid residue, if any, of the claim of the intervener; second, to
pay the debt due the plaintiff in this action; and finally, the residue, if any, to be paid to the estate of the
deceased; the intervener to have her costs in this action in both instances. So ordered.

Arellano, C.J., Torres, Mapa, and Willard, JJ., concur.

Tracey, J., concurs in the result.
G.R. No. L-4963 January 29, 1953

MARIA USON, plaintiff-appellee,

vs.
MARIA DEL ROSARIO, CONCEPCION NEBREDA, CONRADO NEBREDA, DOMINADOR
NEBREDA, AND FAUSTINO NEBREDA, Jr., defendants-appellants.

Priscilo Evangelista for appellee.

Brigido G. Estrada for appellant.

BAUTISTA ANGELO, J.:

This is an action for recovery of the ownership and possession of five (5) parcels of land situated in the
Municipality of Labrador, Province of Pangasinan, filed by Maria Uson against Maria del Rosario and her four
children named Concepcion, Conrado, Dominador, and Faustino, surnamed Nebreda, who are all of minor age,
before the Court of First Instance of Pangasinan.

Maria Uson was the lawful wife of Faustino Nebreda who upon his death in 1945 left the lands involved in this
litigation. Faustino Nebreda left no other heir except his widow Maria Uson. However, plaintiff claims that
when Faustino Nebreda died in 1945, his common-law wife Maria del Rosario took possession illegally of said
lands thus depriving her of their possession and enjoyment.

Defendants in their answer set up as special defense that on February 21, 1931, Maria Uson and her husband,
the late Faustino Nebreda, executed a public document whereby they agreed to separate as husband and wife
and, in consideration of their separation, Maria Uson was given a parcel of land by way of alimony and in return
she renounced her right to inherit any other property that may be left by her husband upon his death (Exhibit 1).

After trial, at which both parties presented their respective evidence, the court rendered decision ordering the
defendants to restore to the plaintiff the ownership and possession of the lands in dispute without special
pronouncement as to costs. Defendants interposed the present appeal.

There is no dispute that Maria Uson, plaintiff-appellee, is the lawful wife of Faustino Nebreda, former owner of
the five parcels of lands litigated in the present case. There is likewise no dispute that Maria del Rosario, one of
the defendants-appellants, was merely a common-law wife of the late Faustino Nebreda with whom she had
four illegitimate children, her now co-defendants. It likewise appears that Faustino Nebreda died in 1945 much
prior to the effectivity of the new Civil Code. With this background, it is evident that when Faustino Nebreda
died in 1945 the five parcels of land he was seized of at the time passed from the moment of his death to his
only heir, his widow Maria Uson (Article 657, old Civil Code).As this Court aptly said, "The property belongs
to the heirs at the moment of the death of the ancestor as completely as if the ancestor had executed and
delivered to them a deed for the same before his death" (Ilustre vs. Alaras Frondosa, 17 Phil., 321). From that
moment, therefore, the rights of inheritance of Maria Uson over the lands in question became vested.

The claim of the defendants that Maria Uson had relinquished her right over the lands in question because she
expressly renounced to inherit any future property that her husband may acquire and leave upon his death in the
deed of separation they had entered into on February 21, 1931, cannot be entertained for the simple reason that
future inheritance cannot be the subject of a contract nor can it be renounced (1 Manresa, 123, sixth edition;
Tolentino on Civil Code, p. 12; Osorio vs. Osorio and Ynchausti Steamship Co., 41 Phil., 531).

But defendants contend that, while it is true that the four minor defendants are illegitimate children of the late
Faustino Nebreda and under the old Civil Code are not entitled to any successional rights, however, under the
new Civil Code which became in force in June, 1950, they are given the status and rights of natural children and
are entitled to the successional rights which the law accords to the latter (article 2264 and article 287, new Civil
Code), and because these successional rights were declared for the first time in the new code, they shall be
given retroactive effect even though the event which gave rise to them may have occurred under the prior
legislation (Article 2253, new Civil Code).

There is no merit in this claim. Article 2253 above referred to provides indeed that rights which are declared for
the first time shall have retroactive effect even though the event which gave rise to them may have occurred
under the former legislation, but this is so only when the new rights do not prejudice any vested or acquired
right of the same origin. Thus, said article provides that "if a right should be declared for the first time in this
Code, it shall be effective at once, even though the act or event which gives rise thereto may have been done or
may have occurred under the prior legislation, provided said new right does not prejudice or impair any vested
or acquired right, of the same origin." As already stated in the early part of this decision, the right of ownership
of Maria Uson over the lands in question became vested in 1945 upon the death of her late husband and this is
so because of the imperative provision of the law which commands that the rights to succession are transmitted
from the moment of death (Article 657, old Civil Code). The new right recognized by the new Civil Code in
favor of the illegitimate children of the deceased cannot, therefore, be asserted to the impairment of the vested
right of Maria Uson over the lands in dispute.

As regards the claim that Maria Uson, while her deceased husband was lying in state, in a gesture of pity or
compassion, agreed to assign the lands in question to the minor children for the reason that they were acquired
while the deceased was living with their mother and Maria Uson wanted to assuage somewhat the wrong she
has done to them, this much can be said; apart from the fact that this claim is disputed, we are of the opinion
that said assignment, if any, partakes of the nature of a donation of real property, inasmuch as it involves no
material consideration, and in order that it may be valid it shall be made in a public document and must be
accepted either in the same document or in a separate one (Article 633, old Civil Code). Inasmuch as this
essential formality has not been followed, it results that the alleged assignment or donation has no valid effect.

WHEREFORE, the decision appealed from is affirmed, without costs.

Paras, C.J., Pablo, Bengzon, Padilla, Tuason, Montemayor, Reyes, Jugo and Labrador, JJ., concur.

G.R. No. L-48372 July 24, 1942

GENEROSA TEVES DE JAKOSALEM, plaintiff-appellant,

vs.
NICOLASA RAFOLS, ET ALS., defendants-appellees.

Tomas Alonso and Silvano Jakosalem for appellant.

Nicolasa Rafols for appellees.

MORAN, J.:

The land in question described in the appealed in the decision originally belonged to Juan Melgar. The latter
died at the judicial administration of his estate was commenced in 1915 and came to a close on December 2,
1924, only. During the pendency of the said administration, that is, on July 5, 1917, Susana Melgar, daughter of
the deceased Juan Melgar, sold the land with the right of repurchase to Pedro Cui, subject to the stipulation that
during the period for the repurchase she would continue in possession of the land as lessee of the purchaser. On
December 12, 1920, the partition of the estate left by the deceased Juan Melgar was made, and the land in
question was adjudicated to Susana Melgar. In 1921, she conveyed, in payment of professional fees, one-half of
the land in favor of the defendant-appellee Nicolasa Rafols, who, entered upon the portion thus conveyed and
has been in possession thereof up to the present. On July 23, 1921, Pedro Cui brought an action to recover said
half of the land from Nicolas Rafols and the other half from the other defendants, and while that case was
pending, or about August 4, 1925, Pedro Cui donated the whole land in question to Generosa Teves, the herein
plaintiff-appellant. After trial, the lower court rendered a decision absolving Nicolas Rafols as to the one-half of
the land conveyed to him by Susana Melgar, and declaring the plaintiff owner of the other half but express
acknowlegment of the other defendants. The plaintiff appealed from that part of the judgment which is
favorable to Nicolas Rafols.

The lower court absolved Nicolas Rafols upon the theory that Susana Melgar could not have anything to Pedro
Cui because the a land was then in custodia legis, that is, under judicial administration. This is error. That the
land could not ordinarily be levied upon while in custodia legis, does not mean that one of the heirs may not sell
the right, interest or participation which he has or might have in the lands under administration. The ordinary
execution of property in custodia legis is prohibited in order to avoid interference with the possession by the
court. But the sale made by an heir of his share in an inheritance, subject to the result of the pending
administration, in no wise stands in the way of such administration.

Article 440 of the Civil Code provides that "the possession of hereditary property is deemed to be transmitted to
the heir without interruption from the instant of the death of the decedent, in case the inheritance be accepted."
And Manresa with reason states upon the death of a person, each of his heirs "becomes the undivided owner of
the whole estate left with respect to the part or portion which might be adjudicated to him, a community of
ownership being thus formed among the coowners of the estate while it remains undivided." (3 Manresa 357;
Alcala vs. Alcala, 35 Phil. 679.) And according to article 399 of the Civil Code, every part owner may assign or
mortgage his part in the common property, and the effect of such assignment or mortgage shall be limited to the
portion which may be alloted him in the partition upon the dissolution of the community. Hence, in the case
ofRamirez vs, Bautista, 14 Phil. 528, where some of the heirs, without the concurrence of the others, sold a
property left by their deceased father, this Court, speaking thru its then Chief Justice Cayetano Arellano, said
that the sale was valid, but that effect thereof was limited to the share which may be allotted to the vendors upon
the partition of the estate.

It results therefore that the sale made by Susana Melgar in favor of Pedro Cui was valid, but it would be
effective only as to the portion to be adjudicated to the vendor upon the partition of the property left by her
deceased father Juan Melgar. And as on December 12, 1920, upon the partition of said property, the land in
question was adjudicated to Susana Melgar, the sale of the whole land which the latter made in favor of Pedro
Cui was entirely confirmed.

Upon the confirmation of the sale of December 12, 1920 in favor of Pedro Cui, the conveyance by Susana
Melgar in favor of Nicolasa Rafols in 1921 could no longer be done. And even in the case of a double sale,
where neither of the purchasers has registered the sale, the first in possession namely, Pedro Cui, should be
referred. When the sale made in the latter's favor was confirmed on December 12, 1920, Susana Melgar was in
possession of the land as lessee, and this possession should be considered as that of Pedro Cui. The possession
of Nicolas Rafols commenced in 1921 only, wherefore, it is subsequent to that of Pedro Cui.

Nicolasa Rafols may not allege prescription of action, for Pedro Cui filed the first complaint in 1921, or the year
following the confirmation of the sale in his favor. And as Nicolas Rafols deprived Pedro Cui of the possession
and the enjoyment of one-half of the land since 1921 to the present, it is only just that he should pay an
indemnity therefor. Six per cent of P1,500, which is the price of one-half of the land, may be considered as the
reasonable amount of this indemnity.

Wherefore, the appealed decision is reversed, and Nicolas Rafols is sentenced to deliver to the plaintiff
Generosa Teves de Jakosalem, one-half of the land conveyed to him by Susana Melgar, and to pay by way of
damages the sum of P90 a year from the filing of the complaint that is, from July 23, 1921, until the delivery of
the land, with the cost of both instances against him. So ordered.

Yulo, C.J., Ozaeta, Paras and Bocobo, JJ., concur.

G.R. No. L-16544 March 30, 1921

LEONARDO OSORIO, plaintiff-appellee,

vs.
TOMASA OSORIO, administratrix of the estate of Petrona Reyes, and THE YNCHAUSTI
STEAMSHIP CO.,defendants-appellants.

Fernandez and Ansaldo for appellants.

Carlos Ledesma for appellee.

VILLAMOR, J.:

The plaintiff seeks to recover 610 shares of stock of "Ynchausti Steamship Co." and the dividends
corresponding to them, which were included in the inventory of the properties of the deceased Da. Maria
Petrona Reyes, whose estate is administered by the defendant. The facts of this case are:

D. Antonio Osorio had formed with Ynchausti & Co., a joint account association for the exploitation of the
shipping business, he being the owner of the one-third of the company's capital. This capital amounted to
P500,000, of which P166,666.66, that is, one-third belonged to D. Antonio Osorio. Upon his death, his heirs
agreed to authorize the defendant Da. Tomasa Osorio, then administratrix of the estate of the deceased, to
present a project of partition, and said administratix inserted in the project with the consent of all the heirs,
among the properties which belonged to the widow Da. Petrona Reyes, the sum of P94,000 as her part in the
"share of the estate in the shipping business of Ynchausti & Co.," that is, a little over P166,666.66, which was
the share in said business of the deceased Osorio during his lifetime. The project of partition was approved on
May 10, 1915, with the consent of the heirs, by the Court of First Instance of Cavite, which had cognizance of
the testamentary and administration proceedings of the state of the deceased Osorio.

On February 28, 1914, the widow of D. Antonio Osorio, Da. Petrona Reyes, now also deceased, executed
before the notary D. Florencio Gonzales Diez a document of gift in favor of her son D. Leonardo Osorio, the
plaintiff, giving to him one-half of her share in the one-third part which belonged to her husband in the shipping
business of Ynchausti & Co., a donation which was duly accepted by the donee D. Leonardo Osorio, who
signed said document with the plaintiff. On that date, February 28, 1914, the estate of D. Antonio Osorio was
not yet distributed among his heirs, and the donor Da. Petrona Reyes in order to correct the error in said
document, wherein it was stated that said half was adjudicated to her as part of her conjugal property, when the
partition was yet being effected, executed another document dated July 3, 1915, maintaining said donation in
effect in the sense that she ceded and donated to her son D. Leonardo Osorio, for the same reasons stated in the
document of February 28, 1914, al interest or participation in said shipping business of Ynchausti & Co., which
was adjudicated to her in the division of the estate of D. Antonio Osorio, which division was approved by the
Court of First Instance of Cavite on May 10, 1915.
After the death of D. Antonio Osorio and before the distribution of the estate, Ynchausti & Co. purchased the
steamer Governor Forbes and recognized the heirs of D. Antonio Osorio as having an interest to the extent of
one-third in the ownership and business of said steamer. It was agreed upon by all the interested parties that the
share of Da. Petrona Reyes, widow of Osorio, in the vessel Governor Forbes, at the time of the incorporation of
"The Ynchausti Steamship Co." was P61,000, equivalent to 610 shares of stock of said corporation. Said sum
was deposited with the Steamship Co. until the final settlement of the question that had arisen between the heirs
of Da. Petrona Reyes as to the ownership thereof for, while the plaintiff alleges that, by virtue of the donation
made in his favor by Da. Petrona Reyes, he is the owner of said shares and of their value which is P61,000; the
defendant on the other hand contends that said shares are not included in the donation in question and belong to
the heirs of Da. Petrona Reyes. Such as the facts which gave rise to this litigation.

The trial court rendered judgment in the case, declaring that the 610 shares of stock in dispute and their
dividends belong to the plaintiff, and ordered the defendant Da. Tomasa Osorio, administratrix of the estate of
Da. Petrona Reyes, to exclude them from the inventory and her accounts, and the other defendant "The
Ynchausti Steamship Co." to inscribe them in the name of the plaintiff D. Leonardo Osorio, delivering to him
the dividends corresponding thereto, and denied the counterclaim for the sum of P45,000, on the ground that
said sum represents the dividends corresponding to the P94,000 adjudicated to Da. Petrona Reyes, in the
partition of the estate of D. Antonio Osorio, and donated by her to the defendant in the counterclaim.

The case having been appealed to this court, counsel for the defendant and appellant, in summing up their
arguments in support of the errors assigned in their brief, maintain the two following propositions:

1. The donation made by Da. Petrona Reyes in favor of the plaintiff was of no value and effect; and

2. That, supposing said donation valid, the 610 shares of stock, the value of which is P61,000, cannot be
considered as included among them.

The document of donation dated February 28, 1914, attacked by the appellant, is as follows:

Know all me by these presents: That I, Petrona Reyes, of age, widow of D. Antonio Osorio and resident of the
Province of Cavite, Philippine Islands, being in possession of all my senses, freely and voluntarily state:

1. That my husband, the deceased D. Antonio Osorio, was a shareholder to the extent of one-third in the joint
account association "Ynchausti & Co." of this place, which is engaged in the business of buying vessels and in
the exploitation of six steam vessels acquired from the Compaia Maritima, the article of association of said
joint account association having been executed in the city of Manila on July 3, 1906, before the notary public D.
Florencio Gonzales Diez.

2. That upon the death of my husband D. Antonio Osorio and upon the partition of his estate, there was
adjudicated to me as conjugal property, one-half of said one-third part in the business referred to, the other half
thereof going to our four surviving children, such being the present condition of our interest in said company.

3. That in consideration of the continuous services and attention received by me from my son D. Leonardo
Osorio, of age, married and a resident of Cavite also, and because of the affection he has always shown and still
shows me, as well as because of the number of children that he has, I make a free and expressed donation to my
said son D. Leonardo Osorio of all my interest and participation in said company "Ynchausti and Co." which is
neither transferred nor burdened in any manner whatever.
4. I also declare that the present donation does not in any way prejudice the right which may accrue to my other
children with respect to inheriting my property and that therefore I can effect this donation, with all liberty, as I
reserve for myself what is sufficient for me to live on in the manner which corresponds to my social position
and needs.

5. In turn, I, Leonardo Osorio, of age, married and a resident of the Province of Cavite, state my conformity and
acceptance of said donation which my dear mother makes to me, for which I am greatly thankful to her.

In witness whereof we sign the present document in triplicate at Manila, Philippine Islands, this twenty-eighth
day of February, nineteen hundred and fourteen.

(Sgd.) PETRONA REYES.

LEONARDO OSORIO.

Signed in the presence of:

(Sgd.) EUSEBIO ALBA.

SALVADOR BARRIOS.

Acknowledged before the notary public D. Florencio Gonzales Diez on February 28, 1914.

The document rectifying the ratifying the preceding is literally as follows:

Know all men by these presents: That I, Petrona Reyes, of age, widow of D. Antonio Osorio and resident of the
Province of Cavite, Philippine Islands, being in the full possession of my senses, freely and voluntarily declare:

1. That on February 28, 1914, before the notary public of Manila, D. Florencio Gonzales Diez, I executed a
document of donation in favor of my son D. Leonardo Osorio, of one-half of the one-third part which my
deceased husband had in certain shipping business of the association "Ynchausti & Co."

2. That in said document I stated, through error, that said half of one-third part of the business referred to was
adjudicated to me as my part of the conjugal property in the partition of the properties left by my deceased
husband, when the truth was that said partition had not yet been put in proper form or finished.

3. That in order to correct said error, I so state, declaring however in any event that I make said donation
subsisting in the sense that I cede and donate to my side son D. Leonardo Osorio, in consideration of the same
causes mentioned in said document of February 28, 1914, all interest or share in said shipping business of
Ynchausti & Co. which was adjudicated to me in the partition of the estate of my deceased husband, and
approved by the Court of First Instance of Cavite, on May 10, 1915.

In witness whereof I sign the present document in triplicate of Cavite on July 3, 1915.

(Sgd. by):

PETRONA REYES.

Signed in the presence of:

(Sgd.) CARLOS LEDESMA.

ISAURO GABALDON.
In support of the first proposition, the appellant invokes as the legal provision violated, article 635 of the Civil
Code, which says:

A donation can not include future property.

By future property is understood that of which the donor can not dispose at the time of making the donation.

Commenting on article 635 of the Civil Code, Manresa says, among other things:

To close these fundamental ideas which the spirit of articles 634 and 635 develops we must fix our attention to
the definition which the Code gives of future properties. They are those of which the donor cannot dispose at
the time of making the donation. This definition in reality includes all properties which belong to others at the
time of the donation, although they may or may not later belong to the donor, thus connecting two ideas which,
although lacking apparently in relation, are merged in reality in the subject which we examine and which gives
assurance to their application. Article 635 refers to the properties of third persons but it may be said that id does
so in relation to a time to come; there can be properties which may latter belong to the donor; but these
properties cannot be donated, because they are not at present his properties, because he cannot dispose of them
at the moment of making the donation. The usufructuary for life or for a determined number of years of a
vineyard may donate said usufruct to the whole extent that it belongs to him but never the property itself. The
bare owner of said vineyard may donate his right of course; but he may also donate the usufruct which
corresponds to the time that it will go back to him, because the case refers to a vested right of which he may
dispose at the time of the donation.

It is alleged that the donation made by Da. Petrona Reyes is void because she donated on February 28, 1914, a
future property, such as the share in the business of the deceased Osorio, which was adjudicated to her on May
10, 1915, and because in 1914 she did not have the right to all or part of the share which her deceased husband
had in the shipping business of Ynchausti & Co.

Carefully examining said article 635 of the Civil Code, in relation to the worthy opinion of the commentator
Manresa, we believe that the future properties, the donation of which is prohibited by said article, are those
belonging to other, which, as such, cannot be the object of the disposal by the donor; but the properties of an
existing inheritance as those of the case at bar, cannot be considered as another's property with relation to the
heirs who through a fiction of law continue the personality of the owner. Nor do they have the character of
future property because the died before 1912, his heirs acquired a right to succeed him from the moment of his
death, because of the principle announced in article 657 and applied by article 661 of the Civil Code, according
to which the heirs succeed the deceased by the mere fact of his death. More of less time may elapse before the
heirs enter into the possession of the hereditary property, but this is not an obstacle, for the acquisition of said
property retroacts in any event to the moment of death, according to article 989 of the Civil Code. The right is
acquired although subject to the adjudication of the corresponding hereditary portion.

Furthermore the Civil Code does not prohibit absolutely that future inheritance should be the object of
agreement, for there are certain cases (arts. 177, 827, 831, and 1331) in which agreements may be made as to
them, beside that indicated in article 1271, and it may be deduced that an inheritance already existing, which is
no longer future from the moment of death of the predecessor, may legally be the object of contract. A donation
being of a contractual nature, inasmuch as for its efficacy the concurrence of two wills is required, that of the
donor and the donee, we believe that which may be the object of contract may also be the object of a
donation. Ubi eadem est ratio, ibi est eadem legis dispositio. We conclude that the donor Da. Petrona Reyes, on
February 28, 1912, and could legally dispose of her right through an act of liberality, as she had done.
With respect to the point that Da. Petrona Reyes did not have in 1914 any right to all or part of the share of her
deceased husband in the shipping business of Ynchausti and Co., it must be observed that in the project of
partition of the property of D. Antonio Osorio the following appears:

The widow of the testator, Maria Petrona Reyes, her children Feliza, Tomasa, and Leonardo and her
granddaugther Soledad Encarnacion Osorio y San Agustin are at present all living and are the only heirs of the
deceased.

The testator declares that all property left by him was acquired during his marriage with Petrona Reyes.

The testator institutes as his only and universal heirs his said children and granddaugther, designates the parts
which each of them must receive as legitime, betterment, and legacy, leaves to the disposition of his widow and
amount equivalent to that set aside by him in payment of one-half part of the conjugal property and orders that
the remainder should be equally distributed among his heirs.

We do not have before us the will of D. Antonio Osorio but supposing that he had left no property but the share
which he had in the shipping business of Ynchausti & Co., can it be denied that the donor by law had the right
to half of said share as her part of the conjugal property? Clearly not. The defendant in her answer says:

That Da. Maria Petrona Reyes did not donate to the plaintiff more that her share in the shipping business of the
firm Ynchausti & Co. which was adjudicated to her in the partition of the property of D. Antonio Osorio and
that said share amounts to P94,000.

This admission of the defendant is conclusive, and makes it unnecessary for us to enter into another discussion
in order to deduce that Da. Petrona Reyes had in 1914 a right to a certain part of the interest of the deceased
Osorio in the shipping business of the firm Ynchausti & Co., and could donate it, as she did, to her son D.
Leonardo Osorio.

The allegation that the document of July 3, 1915, is void, because it does not show the acceptance of the donee,
is of no importance, because of the conclusion we have reached in discussing the document of donation of
February 28, 1914. In the second document, the donor only tried to correct what she believed to be an error in
the first, wherein it is stated that in the partition of the property of her husband there was adjudicated to her the
part of the interest in the shipping business of Ynchausti & Co. which she donated to her son Leonardo, when in
fact said partition was yet pending. After its approval by the Court of First Instance of Cavite, the donor
executed the document of 1915, ratifying and correcting the document of donation. She did not make a new
donation. She executed a personal act which did not require the concurrence of the donee. It is the duty of the
donee, in order that the donation may produce legal effect, to accept to the donation and notify the donor
thereof. The acceptance is necessary because nobody is obliged to receive a benefit against his will. And all this
was complied with in the document of 1914. The wills of the donor and of the donee having concurred, the
donation, as a mode of transferring ownership, becomes perfect, according to article 623 of the Civil Code.

We will not pass to the second proposition of the appellant, that is, that the 610 shares, which are the subject
matter of the suit, cannot be considered as included in the donation made by Da. Petrona Reyes in favor of the
plaintiff, supposing that said donation was valied. The reasons alleged by the appellant are: (1) That the steam
vessel Governor Forbes was purchased after the death of D. Antonio Osorio, with money borrowed and
furnished by the heirs individually and not by the estate, and (2) that the plaintiff appellee has recognized that
the capital used in the steamer Forbes is distinct from the money used in the purchase of other vessels in which
the deceased Osorio had an interest.
The question whether the streamer Governor Forbes was or was not purchased with money furnished by
Ynchausti and the heirs of Osorio, indepedently of that former partnership in which the deceased Osorio had an
interest, is one of the fact and must be resolved in view of the evidence adduced at the trial.

D. Julio Gonzales, secretary and accountant of the firm Ynchausti, witness for the defendant, states that
theForbes was purchased with money which the shipping business of Unchaisti & Co. had. The appellant
herself admits that his vessel took part in the general shipping business of Ynchausti & Co. for no new
partnership was constituted for the purchase thereof, and, after its acquisition the Ynchausti firm accounted to
the estate of D. Antonio Osorio for the profits obtained and the dividends to be distributed and no separate
account was made of the earnings of the vessel, but only a general account, including the profits obtained in the
shipping business, in which the Governor Forbes was but one of several vessels. D. Joaquin Elizalde, manager
of the firm Ynchausti & Co., by agreement of the parties and with the approval of the court, made a deposition
before the notary public D. Florencio Gonzales Diez, stating that when the steamer Forbes was acquired in
1912, the Ynchausti firm did not bring in any new capital, but obtained money for its purchase by mortgaging
the vessel itself and other vesseles of the company; and that the heirs of D. Antonio Osorio did not bring in any
new capital for the purchase of the vessel, but signed jointly with Ynchausti & Co. with the others, except Da.
Soledad Osorio, the guaranty which the bank required.

In our opinion the evidence shows conclusively that the vessel Governor Forbes forms part of the shipping
business of Ynchausti & Co. in which D. Antonio Osorio and his estate had an interest. It is no argument
against this conclusion that the heirs of Osorio signed with Ynchausti & Co. the guaranty required by the bank
where the money used in the purchase of the Forbes was taken: (1) Because the guaranty is for the purpose only
for securing the payment of the amount indebted and not for excluding the estate of Osorio from the result of
that banking operation; (2) because, besides said guaranty, the other vessels of the joint account association of
Osorio and Ynchausti & Co. were mortgage; (3) because no new partnership was formed between Ynchausti &
Co. and the heirs of Osorio for the purchase of the vessel Forbes; and (4) because, when Unchausti & Co.
agreed with the heirs of Osorio in that his share in the steamer Forbes was P108,333.33, this sum was
distributed among said heirs, including Da. Soledad Osorio who did not sign the guaranty, the accruing to each
P11, 833.33 and to the widow Da. Petrona Reyes P61,000, which is the object of this suit.

All of the above shows that the estate of Osorio had a one-third part of the steamer Forbes represented by the
capital which was distributed among the heirs, there accruing to the widow, by agreement of the interested
parties, the sum of P61,000. And this sum being part of the one-half of one-third of the shipping business of
Ynchausti & Co., which one-half part accrued to the widow in the distribution of the properties of Osorio; and
the widow Da. Petrona Reyes having disposed of this half, donating it to her son D. Leonardo Osorio, it clearly
results, in our opinion, that the sum of 61,000, or the corresponding shares of the new corporation "The
Ynchausti Steamship Co." are included in said donation, and therefore belong to the plaintiff-appellee.

The other reason alleged by the appellant in support of her contention is that the plaintiff has recognized in his
letter addressed to the defendant corporation, and inserted in the answer presented by the latter that
the Forbeswas acquired with money different from that of the joint account association theretofore mentioned.
We have carefully read the letter in question and what appears is that said plaintiff agreed that the P61,000
should be deposited with Ynchausti & Co., as trustee, to be distributed with its accumulated dividends, when
the question between the heirs of Da. Petrona Reyes had already been terminated, that is to say, according to the
result of the present suit. There is nothing in said letter which indicates how the Governor Forbes was acquired.
With respect to the counterclaim of P45,609,91, we are of the opinion that the evidence justifies the conclusion
of the trial court that they are the profits or dividends accruing to the P94,000, which were adjudicated to the
widow Da. Petrona Reyes in the distribution of the estate of the deceased Osorio and which were donated by her
to the plaintiff, and as such profits they belong to the latter, upon the principle of law that ownership of property
gives right by accession to all that it produces, or is united or incorporated thereto, naturally or artificially. (Art.
353 of the Civil Code.)

In view of what has been said, the judgment appealed from should be, as it is hereby, affirmed, with costs
against the appellant. So ordered.

Mapa, C.J., Araullo, Street and Malcolm, JJ., concur.

G.R. No. L-23126 March 17, 1925

In the matter of intestate estate of the deceased Juana Servando.

JOSE P. TINSAY, administrator-appellee,
vs.
JOVITA YUSAY and PETRA YUSAY, heirs-appellants.

Block, Johnston and Greenbaum for appellants.

Clemente M. Zulueta for appellee.

OSTRAND, J.:

It appears from the record that one Juan Yusay died some time before the year 1909, leaving a widow Juana
Servando and five children, Candido, Numeriana, Jovito, Jovita and Petra. As far as the record shows his estate
consisted of his interest in a track of land situated in the town of Iloilo, divided into two lots by Calle Aldeguer
and which was community property of his marriage to Juana Servando. In 1909 Jovito Yusay purchased the
interests of Candido and Numeriana in the land, thus acquiring a three- fifths interest in the same.

Jovito Yusay appears to have died some time between the years 1909 and 1911, leaving a widow, Perpetua
Sian, and five minor children, Juana, Elena, Aurea, Elita and Antonia Yusay. In 1911 Perpetua Sian for herself
and in representation of her children entered into an agreement in writing (Exhibit 1) with Jovita and Petra
Yusay which purported to provide for the partition of the land mentioned and whereby Perpetua Sian and her
children were to occupy the portion to the northeast of Calle Aldeguer and Jovita and Petra were to have the
portion or lot to the southwest of this street.

The document is very imperfectly drawn and is in some respects somewhat ambiguous in its terms but it is,
nevertheless, quite clear that in its final clause Jovita and Petra Yusay expressly relinquish in favor of the
children of Jovito Yusay any and all rights which they, Jovita and Petra, might have in the land assigned to
Perpetua Sian and her children in the partition.

Subsequently a cadastral survey was made of the section of Iloilo in which the land in question is situated. In
this survey the portion alloted to Perpetua Sian and her children was designated as lot No. 241, with a narrow
strip set aside for the widening of Calle Aldeguer and described as lot No. 713. The portion which under the
partition of 1911 fell to the share of Jovita and Petra Yusay was given the lot number 283; a narrow strip of the
same portion along Calle Aldeguer is numbered 744.

At the trial of the cadastral case lots Nos. 241 and 713 were claimed by Perpetua Sian on behalf of her children
and the lots were adjudicated to the latter without opposition. Lots Nos. 283 and 744 were claimed by Jovita
and Petra And adjudicated to them, also without opposition.

Shortly thereafter, on August 10, 1915, Juana Servando filed a petition in the cadastral case asking for the
reopening of the case as to lots Nos. 241 and 713 on the ground that she was the owner of a one-half interest in
said lots, but that at the time of the trial of the case Perpetua Sian had falsely lead her to believe that a claim had
been presented in her behalf for her interest in the land. The petition for reopening was granted, the former
judgment set aside and the two lots Nos. 241 and 713 were thereupon decreed in favor of Juana Servando and
the children of Jovito Yusay in the proportions of an undivided half interest in favor of Juana Servando and the
remaining one-half interest in favor of the children of Perpetua Sian in equal shares, the court holding in
substance that Juana Servando not having been a party to the partition made in 1911, her interests were not
affected thereby. The case was appealed to this court and the decision of the lower court affirmed.1

It may be noted that Juana laid no claim to lots Nos. 283 and 744 decreed in favor of Jovita and Petra Yusay
who therefore remained the registered owners of said lots.

On April 12, 1919, after the death of Juana Servando, the appellee Jose P. Tinsay was appointed administrator
of her estate. In July and October, 1922, Jovita and Petra Yusay sold lot No. 283 to one Vicente Tad-Y for the
sum of P20,000. On March 22, 1924, the administrator of the estate of Juana Servando filed an amended
inventory in which the P20,000 received by Jovita and Petra from the sale of lot No. 283 was included as bien
colacionable. On the same day a scheme for the distribution of the estate was submitted to the court in which
the aforesaid P20,000 were brought into collation with the result that the total value of the estate being only
P28,900, according to inventory, no further share in the estate was assigned to Jovita and Petra Yusay.

The scheme of partition was opposed by Jovita and Petra and the matter set down for hearing, at which hearing
the opponents introduced in evidence Exhibit A, a certificate of the register of deeds of the Province of Iloilo
showing that the deceased Juana Servando was the registered owner of a half interest in lots Nos. 241 and 713
and that Jovita and Petra Yusay were the exclusive registered owners of lots Nos. 283 and 744.

The administrator presented in evidence Exhibits 1 to 6, inclusive. Exhibit 1 is the document of partition
between Perpetua Sian and Jovita and Petra Yusay executed in 1911; Exhibits 2 and 3 are deeds executed by
Numeriana and Candido Yusay transferring their interests in all of the lots above-mentioned to Jovito Yusay;
Exhibits 4 and 5 are the deeds for lot No. 283 executed by Jovita and Petra Yusay in favor of Vicente Tad-Y;
and Exhibit 6 evidences a lease from Jovita Yusay of one-half of lot No. 283 in favor of Yap Angching and
dated July 29, 1911. The admission of these exhibits was objected to by opponents and the objections were
sustained by the court, to which ruling counsel for the administrator excepted. The result of the exclusion of the
exhibits is that there in reality is no evidence for the appellee properly before the court; the introductory
statement made by counsel in offering the exhibits and in which he briefly stated their support, is no evidence.
In making the foregoing statement of facts we have, however, drawn freely upon all of the exhibits in order to
bring the issues involved in the case into clear relief.

The court approved the scheme of partition and declared the proceeds of the sale of lots Nos. 283 and 744
"fictitiously collationable" and held that this being in excess of their share of the inheritance, Jovita and Petra
Yusay could claim no further participation in the other property described in the inventory and in the scheme of
partition. In the same order the court declared Exhibits 4 and 5 admissible notwithstanding the fact that they had
been ruled out at the hearing, but maintained its original ruling in regard to Exhibits 1, 2, 3 and 6. From this
order Jovita and Petra Yusay appeal.

The appellants make seven assignments of error and in their brief the discussion has taken a rather wide range.
The matter in controversy may, however, be reduced to very simple terms. It is, of course, clear that the court
below erred in taking into consideration in its decision evidence which it had ruled out at the trial of the case; if,
after the close of the trial, the court upon more mature reflection arrived at the conclusion that some of its
rulings were erroneous, it should have reopened the case before reversing them. We are also of the opinion that
it was error to exclude Exhibits 1, 2 and 3. Exhibit 6 may be of some value to show the interpretation given
Exhibit 1 by the parties and might properly have been admitted in evidence.

We also agree with counsel for the appellants that the case involves no question of this kind
of colacion provided for in articles 1035-1050 of the Civil Code, nor are we here dealing with advancements to
lineal heirs under section 760 of the Code of Civil Procedure in force at the time of the execution of Exhibit 1.
As far as we can see, the appellee must rest his case upon entirely different principles.

The decision appealed from being based on evidence not properly before the trial court, must be reversed, but
inasmuch as the errors committed by that court are of such a character as to have worked what amounts to a
mistrial, it will be necessary to remand the case for a new trial.

For the guidance of the court as well as of counsel at this new trial, we shall briefly state our view of the
principles upon which, in our opinion, the controversy must be determined in the hope of saving further appeals.

Juana Servando not being a party to the partition agreement Exhibit 1, the agreement standing alone was, of
course, ineffective as against her. The attempt to partition her land among her heirs, constituting a partition of a
future inheritance was invalid under the second paragraph of article 1271 of the Civil Code and for the same
reason the renunciation of all interest in the land which now constitutes lots Nos. 241 and 713 made by the
appellants in favor of the children of Jovito Yusay would likewise be of no binding force as to the undivided
portion which belonged to Juana Servando. But if the parties entered into the partition agreement in good faith
and treated all of the land as a present inheritance, and if the appellants on the strength of the agreement
obtained their Torrens title to the land alloted to them therein, and if Perpetua Sian in reliance on the appellants'
renunciation of all interest claimed by her on behalf of her children in the cadastral case refrained from
presenting any opposition to the appellants' claim to the entire fee in the land assigned to them in the partition
agreement and if the appellants after the death of Juana Servando continued to enjoy the benefits of the
agreement refusing to compensate the heirs of Jovito Yusay for the latter's loss of their interest in lots Nos. 283
and 744 through the registration of the lots in the name of the appellants and the subsequent alienation of the
same to innocent third parties, said appellants are now estopped from repudiating the partition agreement of
1911 and from claiming any further interest in lots Nos. 241 and 713. There is, however, no reason why they
should not be allowed to share in the distribution of the other property left by Juana Servando.

We may say further that if a case of estoppel should not be established, the appellants might still, under article
1303 in relation with article 1073 of the Civil Code, be compelled to restore to the estate of Juana Servando
one- half of the amount received by them from the sale of lots Nos. 283 and 744, unless it is shown that Juana's
interest in the lot was transferred to them either by sale or by valid donation. The registration of land does not
necessarily extinguish obligations of that character.

For the reasons stated, the order appealed from is reversed and the case remanded to the court below for a new
trial upon the issues herein suggested. No costs in this instance. So ordered.

Johnson, Malcolm, Villamor, Johns, and Romualdez, JJ., concur.

G.R. No. L-43082 June 18, 1937

PABLO LORENZO, as trustee of the estate of Thomas Hanley, deceased, plaintiff-appellant,

vs.
JUAN POSADAS, JR., Collector of Internal Revenue, defendant-appellant.

Pablo Lorenzo and Delfin Joven for plaintiff-appellant.

Office of the Solicitor-General Hilado for defendant-appellant.

LAUREL, J.:

On October 4, 1932, the plaintiff Pablo Lorenzo, in his capacity as trustee of the estate of Thomas Hanley,
deceased, brought this action in the Court of First Instance of Zamboanga against the defendant, Juan Posadas,
Jr., then the Collector of Internal Revenue, for the refund of the amount of P2,052.74, paid by the plaintiff as
inheritance tax on the estate of the deceased, and for the collection of interst thereon at the rate of 6 per cent per
annum, computed from September 15, 1932, the date when the aforesaid tax was [paid under protest. The
defendant set up a counterclaim for P1,191.27 alleged to be interest due on the tax in question and which was
not included in the original assessment. From the decision of the Court of First Instance of Zamboanga
dismissing both the plaintiff's complaint and the defendant's counterclaim, both parties appealed to this court.

It appears that on May 27, 1922, one Thomas Hanley died in Zamboanga, Zamboanga, leaving a will (Exhibit
5) and considerable amount of real and personal properties. On june 14, 1922, proceedings for the probate of his
will and the settlement and distribution of his estate were begun in the Court of First Instance of Zamboanga.
The will was admitted to probate. Said will provides, among other things, as follows:

4. I direct that any money left by me be given to my nephew Matthew Hanley.

5. I direct that all real estate owned by me at the time of my death be not sold or otherwise disposed of for a
period of ten (10) years after my death, and that the same be handled and managed by the executors, and
proceeds thereof to be given to my nephew, Matthew Hanley, at Castlemore, Ballaghaderine, County of
Rosecommon, Ireland, and that he be directed that the same be used only for the education of my brother's
children and their descendants.
6. I direct that ten (10) years after my death my property be given to the above mentioned Matthew Hanley to be
disposed of in the way he thinks most advantageous.

xxx xxx xxx

8. I state at this time I have one brother living, named Malachi Hanley, and that my nephew, Matthew Hanley,
is a son of my said brother, Malachi Hanley.

The Court of First Instance of Zamboanga considered it proper for the best interests of ther estate to appoint a
trustee to administer the real properties which, under the will, were to pass to Matthew Hanley ten years after
the two executors named in the will, was, on March 8, 1924, appointed trustee. Moore took his oath of office
and gave bond on March 10, 1924. He acted as trustee until February 29, 1932, when he resigned and the
plaintiff herein was appointed in his stead.

During the incumbency of the plaintiff as trustee, the defendant Collector of Internal Revenue, alleging that the
estate left by the deceased at the time of his death consisted of realty valued at P27,920 and personalty valued at
P1,465, and allowing a deduction of P480.81, assessed against the estate an inheritance tax in the amount of
P1,434.24 which, together with the penalties for deliquency in payment consisting of a 1 per cent monthly
interest from July 1, 1931 to the date of payment and a surcharge of 25 per cent on the tax, amounted to
P2,052.74. On March 15, 1932, the defendant filed a motion in the testamentary proceedings pending before the
Court of First Instance of Zamboanga (Special proceedings No. 302) praying that the trustee, plaintiff herein, be
ordered to pay to the Government the said sum of P2,052.74. The motion was granted. On September 15, 1932,
the plaintiff paid said amount under protest, notifying the defendant at the same time that unless the amount was
promptly refunded suit would be brought for its recovery. The defendant overruled the plaintiff's protest and
refused to refund the said amount hausted, plaintiff went to court with the result herein above indicated.

In his appeal, plaintiff contends that the lower court erred:

I. In holding that the real property of Thomas Hanley, deceased, passed to his instituted heir, Matthew Hanley,
from the moment of the death of the former, and that from the time, the latter became the owner thereof.

II. In holding, in effect, that there was deliquency in the payment of inheritance tax due on the estate of said
deceased.

III. In holding that the inheritance tax in question be based upon the value of the estate upon the death of the
testator, and not, as it should have been held, upon the value thereof at the expiration of the period of ten years
after which, according to the testator's will, the property could be and was to be delivered to the instituted heir.

IV. In not allowing as lawful deductions, in the determination of the net amount of the estate subject to said tax,
the amounts allowed by the court as compensation to the "trustees" and paid to them from the decedent's estate.

V. In not rendering judgment in favor of the plaintiff and in denying his motion for new trial.

The defendant-appellant contradicts the theories of the plaintiff and assigns the following error besides:

The lower court erred in not ordering the plaintiff to pay to the defendant the sum of P1,191.27, representing
part of the interest at the rate of 1 per cent per month from April 10, 1924, to June 30, 1931, which the plaintiff
had failed to pay on the inheritance tax assessed by the defendant against the estate of Thomas Hanley.
The following are the principal questions to be decided by this court in this appeal: (a) When does the
inheritance tax accrue and when must it be satisfied? (b) Should the inheritance tax be computed on the basis of
the value of the estate at the time of the testator's death, or on its value ten years later? (c) In determining the net
value of the estate subject to tax, is it proper to deduct the compensation due to trustees? (d) What law governs
the case at bar? Should the provisions of Act No. 3606 favorable to the tax-payer be given retroactive effect? (e)
Has there been deliquency in the payment of the inheritance tax? If so, should the additional interest claimed by
the defendant in his appeal be paid by the estate? Other points of incidental importance, raised by the parties in
their briefs, will be touched upon in the course of this opinion.

(a) The accrual of the inheritance tax is distinct from the obligation to pay the same. Section 1536 as amended,
of the Administrative Code, imposes the tax upon "every transmission by virtue of inheritance, devise, bequest,
giftmortis causa, or advance in anticipation of inheritance,devise, or bequest." The tax therefore is upon
transmission or the transfer or devolution of property of a decedent, made effective by his death. (61 C. J., p.
1592.) It is in reality an excise or privilege tax imposed on the right to succeed to, receive, or take property by
or under a will or the intestacy law, or deed, grant, or gift to become operative at or after death. Acording to
article 657 of the Civil Code, "the rights to the succession of a person are transmitted from the moment of his
death." "In other words", said Arellano, C. J., ". . . the heirs succeed immediately to all of the property of the
deceased ancestor. The property belongs to the heirs at the moment of the death of the ancestor as completely as
if the ancestor had executed and delivered to them a deed for the same before his death." (Bondad vs. Bondad,
34 Phil., 232. See also, Mijares vs. Nery, 3 Phil., 195; Suilong & Co., vs. Chio-Taysan, 12 Phil., 13; Lubrico vs.
Arbado, 12 Phil., 391; Innocencio vs. Gat-Pandan, 14 Phil., 491; Aliasas vs.Alcantara, 16 Phil., 489; Ilustre vs.
Alaras Frondosa, 17 Phil., 321; Malahacan vs. Ignacio, 19 Phil., 434; Bowa vs. Briones, 38 Phil., 27; Osario vs.
Osario & Yuchausti Steamship Co., 41 Phil., 531; Fule vs. Fule, 46 Phil., 317; Dais vs. Court of First Instance
of Capiz, 51 Phil., 396; Baun vs. Heirs of Baun, 53 Phil., 654.) Plaintiff, however, asserts that while article 657
of the Civil Code is applicable to testate as well as intestate succession, it operates only in so far as forced heirs
are concerned. But the language of article 657 of the Civil Code is broad and makes no distinction between
different classes of heirs. That article does not speak of forced heirs; it does not even use the word "heir". It
speaks of the rights of succession and the transmission thereof from the moment of death. The provision of
section 625 of the Code of Civil Procedure regarding the authentication and probate of a will as a necessary
condition to effect transmission of property does not affect the general rule laid down in article 657 of the Civil
Code. The authentication of a will implies its due execution but once probated and allowed the transmission is
effective as of the death of the testator in accordance with article 657 of the Civil Code. Whatever may be the
time when actual transmission of the inheritance takes place, succession takes place in any event at the moment
of the decedent's death. The time when the heirs legally succeed to the inheritance may differ from the time
when the heirs actually receive such inheritance. "Poco importa", says Manresa commenting on article 657 of
the Civil Code, "que desde el falleimiento del causante, hasta que el heredero o legatario entre en posesion de
los bienes de la herencia o del legado, transcurra mucho o poco tiempo, pues la adquisicion ha de retrotraerse
al momento de la muerte, y asi lo ordena el articulo 989, que debe considerarse como complemento del
presente." (5 Manresa, 305; see also, art. 440, par. 1, Civil Code.) Thomas Hanley having died on May 27,
1922, the inheritance tax accrued as of the date.

From the fact, however, that Thomas Hanley died on May 27, 1922, it does not follow that the obligation to pay
the tax arose as of the date. The time for the payment on inheritance tax is clearly fixed by section 1544 of the
Revised Administrative Code as amended by Act No. 3031, in relation to section 1543 of the same Code. The
two sections follow:
SEC. 1543. Exemption of certain acquisitions and transmissions. The following shall not be taxed:

(a) The merger of the usufruct in the owner of the naked title.

(b) The transmission or delivery of the inheritance or legacy by the fiduciary heir or legatee to the trustees.

(c) The transmission from the first heir, legatee, or donee in favor of another beneficiary, in accordance with the
desire of the predecessor.

In the last two cases, if the scale of taxation appropriate to the new beneficiary is greater than that paid by the
first, the former must pay the difference.

SEC. 1544. When tax to be paid. The tax fixed in this article shall be paid:

(a) In the second and third cases of the next preceding section, before entrance into possession of the property.

(b) In other cases, within the six months subsequent to the death of the predecessor; but if judicial testamentary
or intestate proceedings shall be instituted prior to the expiration of said period, the payment shall be made by
the executor or administrator before delivering to each beneficiary his share.

If the tax is not paid within the time hereinbefore prescribed, interest at the rate of twelve per centum per annum
shall be added as part of the tax; and to the tax and interest due and unpaid within ten days after the date of
notice and demand thereof by the collector, there shall be further added a surcharge of twenty-five per centum.

A certified of all letters testamentary or of admisitration shall be furnished the Collector of Internal Revenue by
the Clerk of Court within thirty days after their issuance.

It should be observed in passing that the word "trustee", appearing in subsection (b) of section 1543, should
read "fideicommissary" or "cestui que trust". There was an obvious mistake in translation from the Spanish to
the English version.

The instant case does fall under subsection (a), but under subsection (b), of section 1544 above-quoted, as there
is here no fiduciary heirs, first heirs, legatee or donee. Under the subsection, the tax should have been paid
before the delivery of the properties in question to P. J. M. Moore as trustee on March 10, 1924.

(b) The plaintiff contends that the estate of Thomas Hanley, in so far as the real properties are concerned, did
not and could not legally pass to the instituted heir, Matthew Hanley, until after the expiration of ten years from
the death of the testator on May 27, 1922 and, that the inheritance tax should be based on the value of the estate
in 1932, or ten years after the testator's death. The plaintiff introduced evidence tending to show that in 1932 the
real properties in question had a reasonable value of only P5,787. This amount added to the value of the
personal property left by the deceased, which the plaintiff admits is P1,465, would generate an inheritance tax
which, excluding deductions, interest and surcharge, would amount only to about P169.52.

If death is the generating source from which the power of the estate to impose inheritance taxes takes its being
and if, upon the death of the decedent, succession takes place and the right of the estate to tax vests instantly,
the tax should be measured by the vlaue of the estate as it stood at the time of the decedent's death, regardless of
any subsequent contingency value of any subsequent increase or decrease in value. (61 C. J., pp. 1692, 1693; 26
R. C. L., p. 232; Blakemore and Bancroft, Inheritance Taxes, p. 137. See also Knowlton vs. Moore, 178 U.S.,
41; 20 Sup. Ct. Rep., 747; 44 Law. ed., 969.) "The right of the state to an inheritance tax accrues at the moment
of death, and hence is ordinarily measured as to any beneficiary by the value at that time of such property as
passes to him. Subsequent appreciation or depriciation is immaterial." (Ross, Inheritance Taxation, p. 72.)

Our attention is directed to the statement of the rule in Cyclopedia of Law of and Procedure (vol. 37, pp. 1574,
1575) that, in the case of contingent remainders, taxation is postponed until the estate vests in possession or the
contingency is settled. This rule was formerly followed in New York and has been adopted in Illinois,
Minnesota, Massachusetts, Ohio, Pennsylvania and Wisconsin. This rule, horever, is by no means entirely
satisfactory either to the estate or to those interested in the property (26 R. C. L., p. 231.). Realizing, perhaps,
the defects of its anterior system, we find upon examination of cases and authorities that New York has varied
and now requires the immediate appraisal of the postponed estate at its clear market value and the payment
forthwith of the tax on its out of the corpus of the estate transferred. (In re Vanderbilt, 172 N. Y., 69; 69 N. E.,
782; In re Huber, 86 N. Y. App. Div., 458; 83 N. Y. Supp., 769; Estate of Tracy, 179 N. Y., 501; 72 N. Y., 519;
Estate of Brez, 172 N. Y., 609; 64 N. E., 958; Estate of Post, 85 App. Div., 611; 82 N. Y. Supp., 1079. Vide
also, Saltoun vs. Lord Advocate, 1 Peter. Sc. App., 970; 3 Macq. H. L., 659; 23 Eng. Rul. Cas., 888.) California
adheres to this new rule (Stats. 1905, sec. 5, p. 343).

But whatever may be the rule in other jurisdictions, we hold that a transmission by inheritance is taxable at the
time of the predecessor's death, notwithstanding the postponement of the actual possession or enjoyment of the
estate by the beneficiary, and the tax measured by the value of the property transmitted at that time regardless of
its appreciation or depreciation.

(c) Certain items are required by law to be deducted from the appraised gross in arriving at the net value of the
estate on which the inheritance tax is to be computed (sec. 1539, Revised Administrative Code). In the case at
bar, the defendant and the trial court allowed a deduction of only P480.81. This sum represents the expenses
and disbursements of the executors until March 10, 1924, among which were their fees and the proven debts of
the deceased. The plaintiff contends that the compensation and fees of the trustees, which aggregate P1,187.28
(Exhibits C, AA, EE, PP, HH, JJ, LL, NN, OO), should also be deducted under section 1539 of the Revised
Administrative Code which provides, in part, as follows: "In order to determine the net sum which must bear
the tax, when an inheritance is concerned, there shall be deducted, in case of a resident, . . . the judicial expenses
of the testamentary or intestate proceedings, . . . ."

A trustee, no doubt, is entitled to receive a fair compensation for his services (Barney vs. Saunders, 16 How.,
535; 14 Law. ed., 1047). But from this it does not follow that the compensation due him may lawfully be
deducted in arriving at the net value of the estate subject to tax. There is no statute in the Philippines which
requires trustees' commissions to be deducted in determining the net value of the estate subject to inheritance
tax (61 C. J., p. 1705). Furthermore, though a testamentary trust has been created, it does not appear that the
testator intended that the duties of his executors and trustees should be separated. (Ibid.; In re Vanneck's Estate,
161 N. Y. Supp., 893; 175 App. Div., 363; In re Collard's Estate, 161 N. Y. Supp., 455.) On the contrary, in
paragraph 5 of his will, the testator expressed the desire that his real estate be handled and managed by his
executors until the expiration of the period of ten years therein provided. Judicial expenses are expenses of
administration (61 C. J., p. 1705) but, in State vs. Hennepin County Probate Court (112 N. W., 878; 101 Minn.,
485), it was said: ". . . The compensation of a trustee, earned, not in the administration of the estate, but in the
management thereof for the benefit of the legatees or devises, does not come properly within the class or reason
for exempting administration expenses. . . . Service rendered in that behalf have no reference to closing the
estate for the purpose of a distribution thereof to those entitled to it, and are not required or essential to the
perfection of the rights of the heirs or legatees. . . . Trusts . . . of the character of that here before the court, are
created for the the benefit of those to whom the property ultimately passes, are of voluntary creation, and
intended for the preservation of the estate. No sound reason is given to support the contention that such
expenses should be taken into consideration in fixing the value of the estate for the purpose of this tax."

(d) The defendant levied and assessed the inheritance tax due from the estate of Thomas Hanley under the
provisions of section 1544 of the Revised Administrative Code, as amended by section 3 of Act No. 3606. But
Act No. 3606 went into effect on January 1, 1930. It, therefore, was not the law in force when the testator died
on May 27, 1922. The law at the time was section 1544 above-mentioned, as amended by Act No. 3031, which
took effect on March 9, 1922.

It is well-settled that inheritance taxation is governed by the statute in force at the time of the death of the
decedent (26 R. C. L., p. 206; 4 Cooley on Taxation, 4th ed., p. 3461). The taxpayer can not foresee and ought
not to be required to guess the outcome of pending measures. Of course, a tax statute may be made retroactive
in its operation. Liability for taxes under retroactive legislation has been "one of the incidents of social life."
(Seattle vs. Kelleher, 195 U. S., 360; 49 Law. ed., 232 Sup. Ct. Rep., 44.) But legislative intent that a tax statute
should operate retroactively should be perfectly clear. (Scwab vs. Doyle, 42 Sup. Ct. Rep., 491; Smietanka vs.
First Trust & Savings Bank, 257 U. S., 602; Stockdale vs. Insurance Co., 20 Wall., 323; Lunch vs. Turrish, 247
U. S., 221.) "A statute should be considered as prospective in its operation, whether it enacts, amends, or repeals
an inheritance tax, unless the language of the statute clearly demands or expresses that it shall have a retroactive
effect, . . . ." (61 C. J., P. 1602.) Though the last paragraph of section 5 of Regulations No. 65 of the Department
of Finance makes section 3 of Act No. 3606, amending section 1544 of the Revised Administrative Code,
applicable to all estates the inheritance taxes due from which have not been paid, Act No. 3606 itself contains
no provisions indicating legislative intent to give it retroactive effect. No such effect can begiven the statute by
this court.

The defendant Collector of Internal Revenue maintains, however, that certain provisions of Act No. 3606 are
more favorable to the taxpayer than those of Act No. 3031, that said provisions are penal in nature and,
therefore, should operate retroactively in conformity with the provisions of article 22 of the Revised Penal
Code. This is the reason why he applied Act No. 3606 instead of Act No. 3031. Indeed, under Act No. 3606, (1)
the surcharge of 25 per cent is based on the tax only, instead of on both the tax and the interest, as provided for
in Act No. 3031, and (2) the taxpayer is allowed twenty days from notice and demand by rthe Collector of
Internal Revenue within which to pay the tax, instead of ten days only as required by the old law.

Properly speaking, a statute is penal when it imposes punishment for an offense committed against the state
which, under the Constitution, the Executive has the power to pardon. In common use, however, this sense has
been enlarged to include within the term "penal statutes" all status which command or prohibit certain acts, and
establish penalties for their violation, and even those which, without expressly prohibiting certain acts, impose a
penalty upon their commission (59 C. J., p. 1110). Revenue laws, generally, which impose taxes collected by
the means ordinarily resorted to for the collection of taxes are not classed as penal laws, although there are
authorities to the contrary. (See Sutherland, Statutory Construction, 361; Twine Co. vs. Worthington, 141 U. S.,
468; 12 Sup. Ct., 55; Rice vs. U. S., 4 C. C. A., 104; 53 Fed., 910; Com. vs. Standard Oil Co., 101 Pa. St., 150;
State vs. Wheeler, 44 P., 430; 25 Nev. 143.) Article 22 of the Revised Penal Code is not applicable to the case at
bar, and in the absence of clear legislative intent, we cannot give Act No. 3606 a retroactive effect.

(e) The plaintiff correctly states that the liability to pay a tax may arise at a certain time and the tax may be paid
within another given time. As stated by this court, "the mere failure to pay one's tax does not render one
delinqent until and unless the entire period has eplased within which the taxpayer is authorized by law to make
such payment without being subjected to the payment of penalties for fasilure to pay his taxes within the
prescribed period." (U. S. vs. Labadan, 26 Phil., 239.)

The defendant maintains that it was the duty of the executor to pay the inheritance tax before the delivery of the
decedent's property to the trustee. Stated otherwise, the defendant contends that delivery to the trustee was
delivery to the cestui que trust, the beneficiery in this case, within the meaning of the first paragraph of
subsection (b) of section 1544 of the Revised Administrative Code. This contention is well taken and is
sustained. The appointment of P. J. M. Moore as trustee was made by the trial court in conformity with the
wishes of the testator as expressed in his will. It is true that the word "trust" is not mentioned or used in the will
but the intention to create one is clear. No particular or technical words are required to create a testamentary
trust (69 C. J., p. 711). The words "trust" and "trustee", though apt for the purpose, are not necessary. In fact,
the use of these two words is not conclusive on the question that a trust is created (69 C. J., p. 714). "To create a
trust by will the testator must indicate in the will his intention so to do by using language sufficient to separate
the legal from the equitable estate, and with sufficient certainty designate the beneficiaries, their interest in the
ttrust, the purpose or object of the trust, and the property or subject matter thereof. Stated otherwise, to
constitute a valid testamentary trust there must be a concurrence of three circumstances: (1) Sufficient words to
raise a trust; (2) a definite subject; (3) a certain or ascertain object; statutes in some jurisdictions expressly or in
effect so providing." (69 C. J., pp. 705,706.) There is no doubt that the testator intended to create a trust. He
ordered in his will that certain of his properties be kept together undisposed during a fixed period, for a stated
purpose. The probate court certainly exercised sound judgment in appointment a trustee to carry into effect the
provisions of the will (see sec. 582, Code of Civil Procedure).

P. J. M. Moore became trustee on March 10, 1924. On that date trust estate vested in him (sec. 582 in relation to
sec. 590, Code of Civil Procedure). The mere fact that the estate of the deceased was placed in trust did not
remove it from the operation of our inheritance tax laws or exempt it from the payment of the inheritance tax.
The corresponding inheritance tax should have been paid on or before March 10, 1924, to escape the penalties
of the laws. This is so for the reason already stated that the delivery of the estate to the trustee was in
esse delivery of the same estate to the cestui que trust, the beneficiary in this case. A trustee is but an instrument
or agent for thecestui que trust (Shelton vs. King, 299 U. S., 90; 33 Sup. Ct. Rep., 689; 57 Law. ed., 1086).
When Moore accepted the trust and took possesson of the trust estate he thereby admitted that the estate
belonged not to him but to his cestui que trust (Tolentino vs. Vitug, 39 Phil.,126, cited in 65 C. J., p. 692, n. 63).
He did not acquire any beneficial interest in the estate. He took such legal estate only as the proper execution of
the trust required (65 C. J., p. 528) and, his estate ceased upon the fulfillment of the testator's wishes. The estate
then vested absolutely in the beneficiary (65 C. J., p. 542).

The highest considerations of public policy also justify the conclusion we have reached. Were we to hold that
the payment of the tax could be postponed or delayed by the creation of a trust of the type at hand, the result
would be plainly disastrous. Testators may provide, as Thomas Hanley has provided, that their estates be not
delivered to their beneficiaries until after the lapse of a certain period of time. In the case at bar, the period is ten
years. In other cases, the trust may last for fifty years, or for a longer period which does not offend the rule
against petuities. The collection of the tax would then be left to the will of a private individual. The mere
suggestion of this result is a sufficient warning against the accpetance of the essential to the very exeistence of
government. (Dobbins vs. Erie Country, 16 Pet., 435; 10 Law. ed., 1022; Kirkland vs. Hotchkiss, 100 U. S.,
491; 25 Law. ed., 558; Lane County vs. Oregon, 7 Wall., 71; 19 Law. ed., 101; Union Refrigerator Transit Co.
vs. Kentucky, 199 U. S., 194; 26 Sup. Ct. Rep., 36; 50 Law. ed., 150; Charles River Bridge vs. Warren Bridge,
11 Pet., 420; 9 Law. ed., 773.) The obligation to pay taxes rests not upon the privileges enjoyed by, or the
protection afforded to, a citizen by the government but upon the necessity of money for the support of the state
(Dobbins vs. Erie Country, supra). For this reason, no one is allowed to object to or resist the payment of taxes
solely because no personal benefit to him can be pointed out. (Thomas vs. Gay, 169 U. S., 264; 18 Sup. Ct.
Rep., 340; 43 Law. ed., 740.) While courts will not enlarge, by construction, the government's power of taxation
(Bromley vs. McCaughn, 280 U. S., 124; 74 Law. ed., 226; 50 Sup. Ct. Rep., 46) they also will not place upon
tax laws so loose a construction as to permit evasions on merely fanciful and insubstantial distictions. (U. S. vs.
Watts, 1 Bond., 580; Fed. Cas. No. 16,653; U. S. vs. Wigglesirth, 2 Story, 369; Fed. Cas. No. 16,690, followed
in Froelich & Kuttner vs. Collector of Customs, 18 Phil., 461, 481; Castle Bros., Wolf & Sons vs. McCoy, 21
Phil., 300; Muoz & Co. vs. Hord, 12 Phil., 624; Hongkong & Shanghai Banking Corporation vs. Rafferty, 39
Phil., 145; Luzon Stevedoring Co. vs. Trinidad, 43 Phil., 803.) When proper, a tax statute should be construed
to avoid the possibilities of tax evasion. Construed this way, the statute, without resulting in injustice to the
taxpayer, becomes fair to the government.

That taxes must be collected promptly is a policy deeply intrenched in our tax system. Thus, no court is allowed
to grant injunction to restrain the collection of any internal revenue tax ( sec. 1578, Revised Administrative
Code; Sarasola vs. Trinidad, 40 Phil., 252). In the case of Lim Co Chui vs. Posadas (47 Phil., 461), this court
had occassion to demonstrate trenchment adherence to this policy of the law. It held that "the fact that on
account of riots directed against the Chinese on October 18, 19, and 20, 1924, they were prevented from praying
their internal revenue taxes on time and by mutual agreement closed their homes and stores and remained
therein, does not authorize the Collector of Internal Revenue to extend the time prescribed for the payment of
the taxes or to accept them without the additional penalty of twenty five per cent." (Syllabus, No. 3.)

". . . It is of the utmost importance," said the Supreme Court of the United States, ". . . that the modes adopted to
enforce the taxes levied should be interfered with as little as possible. Any delay in the proceedings of the
officers, upon whom the duty is developed of collecting the taxes, may derange the operations of government,
and thereby, cause serious detriment to the public." (Dows vs. Chicago, 11 Wall., 108; 20 Law. ed., 65, 66;
Churchill and Tait vs. Rafferty, 32 Phil., 580.)

It results that the estate which plaintiff represents has been delinquent in the payment of inheritance tax and,
therefore, liable for the payment of interest and surcharge provided by law in such cases.

The delinquency in payment occurred on March 10, 1924, the date when Moore became trustee. The interest
due should be computed from that date and it is error on the part of the defendant to compute it one month later.
The provisions cases is mandatory (see and cf. Lim Co Chui vs. Posadas, supra), and neither the Collector of
Internal Revenuen or this court may remit or decrease such interest, no matter how heavily it may burden the
taxpayer.

To the tax and interest due and unpaid within ten days after the date of notice and demand thereof by the
Collector of Internal Revenue, a surcharge of twenty-five per centum should be added (sec. 1544, subsec. (b),
par. 2, Revised Administrative Code). Demand was made by the Deputy Collector of Internal Revenue upon
Moore in a communiction dated October 16, 1931 (Exhibit 29). The date fixed for the payment of the tax and
interest was November 30, 1931. November 30 being an official holiday, the tenth day fell on December 1,
1931. As the tax and interest due were not paid on that date, the estate became liable for the payment of the
surcharge.

In view of the foregoing, it becomes unnecessary for us to discuss the fifth error assigned by the plaintiff in his
brief.
We shall now compute the tax, together with the interest and surcharge due from the estate of Thomas Hanley
inaccordance with the conclusions we have reached.

At the time of his death, the deceased left real properties valued at P27,920 and personal properties worth
P1,465, or a total of P29,385. Deducting from this amount the sum of P480.81, representing allowable
deductions under secftion 1539 of the Revised Administrative Code, we have P28,904.19 as the net value of the
estate subject to inheritance tax.

The primary tax, according to section 1536, subsection (c), of the Revised Administrative Code, should be
imposed at the rate of one per centum upon the first ten thousand pesos and two per centum upon the amount by
which the share exceed thirty thousand pesos, plus an additional two hundred per centum. One per centum of
ten thousand pesos is P100. Two per centum of P18,904.19 is P378.08. Adding to these two sums an additional
two hundred per centum, or P965.16, we have as primary tax, correctly computed by the defendant, the sum of
P1,434.24.

To the primary tax thus computed should be added the sums collectible under section 1544 of the Revised
Administrative Code. First should be added P1,465.31 which stands for interest at the rate of twelve per centum
per annum from March 10, 1924, the date of delinquency, to September 15, 1932, the date of payment under
protest, a period covering 8 years, 6 months and 5 days. To the tax and interest thus computed should be added
the sum of P724.88, representing a surhcarge of 25 per cent on both the tax and interest, and also P10, the
compromise sum fixed by the defendant (Exh. 29), giving a grand total of P3,634.43.

As the plaintiff has already paid the sum of P2,052.74, only the sums of P1,581.69 is legally due from the
estate. This last sum is P390.42 more than the amount demanded by the defendant in his counterclaim. But, as
we cannot give the defendant more than what he claims, we must hold that the plaintiff is liable only in the sum
of P1,191.27 the amount stated in the counterclaim.

The judgment of the lower court is accordingly modified, with costs against the plaintiff in both instances. So
ordered.

Avancea, C.J., Abad Santos, Imperial, Diaz and Concepcion, JJ., concur.
Villa-Real, J., concurs.
G.R. No. L-27531 December 24, 1927

In re estate of the deceased Victoriana Saavedra. MACARIO MACROHON ONG HAM, administrator-
appellant,
vs.
JUAN SAAVEDRA, ET AL., opponents-appellees.

Frank H. Young and Pablo Lorenzo for appellant.

No appearance for appellees.

VILLAMOR, J.:

Macario Macrohon Ong Ham, widower and executor of the joint last will and testament of Victoriana Saavedra
and himself, presented said will for probate, which was ordered by the Court of First Instance of Zamboanga in
its decree of February 21, 1924.

This executor submitted a scheme of partition and distribution of the property in accordance with the terms of
the joint will, to which Juan Saavedra and others filed an opposition. The executor rejoined insisting upon the
approval of the scheme and asking that the opposition of Juan Saavedra and others be overruled.

On March 25, 1926, the parties submitted a statement of facts, which reads as follows:
1. That Victoriana Saavedra died in the municipality and Province of Zamboanga, P. I., without descendants or
ascendants, being at that time married to Macario Macrohon Ong Ham, both of them having executed a joint
will, which joint will has been duly admitted to probate in this court.

2. That the only near relations of the said Victoriana Saavedra, with the right to inherit her estate are her
brothers Juan and Segundo Saavedra; her nephews and nieces, Teofilo Saavedra, Manuel Saavedra, Victoriana
Saavedra, Mariano Saavedra, Froilan Saavedra, Josefa Saavedra, Encarnacion Carpio and Macra Carpio, in case
that the said Victoriana Saavedra died intestate, or did not dispose of her property in said will.

3. That aside from the estate mentioned in the said last will and testament, duly probated by this Honorable
Court, there exist another parcel of land, acquired by Ong Ham the year 1920, by purchase from Ong Tah, and
adjudicated to the said Ong Ham in Expediente No. 6 (Cadastral).

Lot No. 3057, with the improvements thereon in favor of the persons named below in the following proportions:
Ong Ham, aged 65 years, married to Victoriana Saavedra, 19/20 parts; Crispulo Macoto Cruz, of legal age, 1/40
part; and Juan Mocoto, 1/40 part.

4. That the interest parties in this proceeding herewith submit to this Honorable Court the rights of the
respective parties in this estate, in accordance with the terms of this joint last will and testament of the spouses,
Macario Macrohon Ong Ham, and of Victoriana Saavedra, deceased.

5. That the parties representing Macario Macrohon Ong Ham admit that he sold lots Nos. 34 and 35,
ofExpediente No. 8196, for the sum of P1,900, believing in good faith that he could sell the same for his
personal uses.

6. That the party representing Juan Saavedra, and the other relations heretofore named hereby withdraw their
opposition which they have presented to the final account of the surviving spouse, Macario Macrohon Ong
Ham, and conform to the same, and ask that the Court approve the said final account.

The will referred to in the statement of facts above quoted reads as follows:

That we, Macario Macrohon Ong Ham Victoriana Saavedra, both residing at San Roque, municipality and
Province of Zamboanga, Philippine Islands, and both of about 70 years of age, realizing that we have but a few
more years to live, and each of us being in the full enjoyment of his intellectual faculties and not acting by
virtue of threats, force or undue influence, individually and conjointly do hereby make public, declare, and
execute this, our last will and testament, in the following terms:

We hereby declare that we are husband and wife; that we have had no issue, nor have we adopted children.

We hereby likewise declare that Macario Macrohon Ong Ham is a native of China, having resided in
Zamboanga, Philippine Islands for over 40 years, and that Victoriana Saavedra is a native of the Philippine
Islands.

We furthermore declare that Macario Macrohon Ong Ham has two nephews at present residing in Zamboanga,
Philippine Islands, whom he has always treated as his own sons, following the custom of Amoy, China, whose
names and ages respectively as follows:

Ong Ka Chiew, residing at San Roque, Zambaoanga, P. I., about 20 years of age, single, and Ong Ka Jian, also
residing at San Roque, Zamboanga, P.I., about 18 years of age, single.
We also declare that there are actually registered in our names, as conjugal property, the following parcels of
land located in Zamboanga, P. I., to wit:

Lot No. 838 A, proceeding 7880, certificate No. 1257

Lot No. 825, proceeding 7880, certificate No. 1783
Lot No. 832, proceeding 7880, same certificate
Lot No. 330, proceeding 7880, certificate No. 4027
Lot No. 1, proceeding 7880, same certificate
Lot No. 199, proceeding 7880, certificate No. 736
Lot No. 329, proceeding 7880, certificate No. 858
Lot No. 838 C, proceeding 7880, certificate No. 1259
Lot No. 831 B, proceeding 7880, certificate No. 1256
Lot No. 817, proceeding 7880, certificate No. 1247
Lot No. 768, proceeding 7880, certificate No. 1105
Lot No. 35, proceeding 8196, certificate No. 1257
Lot No. 65 A, proceeding 8196, certificate No. 3688
Lot No. 834, proceeding 7880, certificate No. 4025
Lot No. 96, proceeding 8196, certificate No. 4025
Lot No. 57 A, proceeding 8196, certificate No. 4871
Lot No. 222, proceeding 7880, certificate No. 861
Lot No. 34, proceeding 8196, certificate No. 4858
Lot No. 137 C, proceeding 8196, certificate No. 2223

We do hereby agree jointly and individually, that our properties above described by disposed of in the following
manner:lawphi1.net

In case of the death of Macario Macrohon Ong Ham before Victoriana Saavedra, we hereby order that the
properties hereinafter described be jointly given to Ong Ka Chiew and Ong Ka Jian , and should either of the
two die before Macario Macrohon Ong Ham, we order that all the said properties be given to the survivor,
which properties are described as follows:

Lot No. 838 C, proceeding 7880, certificate No. 1259

Lot No. 831 B, proceeding 7880, certificate No. 1256
Lot No. 825, proceeding 7880, certificate No. 1783
Lot No. 832, proceeding 7880, same certificate
Lot No. 330, proceeding 7880, certificate No. 4027
Lot No. 1, proceeding 7880, same certificate
Lot No. 199, proceeding 7880, certificate No. 736
Lot No. 329, proceeding 7880, certificate No. 858
Lot No. 35, proceeding 8196, certificate No. 1257
Lot No. 65 A, proceeding 8196, certificate No. 3688
Lot No. 834, proceeding 7880, certificate No. 4025
Lot No. 96, proceeding 8196, same certificate
Lot No. 57 A, proceeding 8196, certificate No. 4871
Lot No. 222, proceeding 7880, certificate No. 861
Lot No. 34, proceeding 8196, certificate 4858
Lot No. 137 C, proceeding 8196, certificate No. 2223

In case that Victoriana Saavedra should survive Macario Macrohon Ong Ham, the lands and properties
described below shall belong exclusively to Victoriana Saavedra, to wit:

Lot No. 838 A, proceeding 7880, certificate No. 1257

Lot No. 817, proceeding 7880, certificate No. 1247
Lot No. 768, proceeding 7880, certificate No. 1105

Should Victoriana Saavedra die before Macario Macrohon Ong Ham, we order that lot No. 817-A, proceeding
No. 7880, certificate No. 1247, be adjudicated to Segunda Saavedra, widow, sister of Victoriana Saavedra, free
of all liens and encumbrances.

We further order that all our debts and just obligations, including the expenses of our last illness and funerals,
be paid by Ong Ka Chiew and Ong Ka Jian.

If any of the legatees named herein should question or in any way attempt to alter the disposition of any of our
several properties, such legatee is to lose and shall no longer receive the benefits and rights herein specified.

We individually and cojointly declare that the contents of this document have been read aloud to us in our
dialect and that we understand said contents, this document having been read in the presence of each of us and
in the presence of the witnesses whose names are mentioned further on and who have signed the present
instrument together with ourselves.

In witness whereof, we sign this our last will and testament at Zamboanga, Zamboanga, Philippine Islands, on
this second (2) day of January, 1923.

We, Ong Peh, Ong Chua, and T. Arquiza, do hereby certify that the foregoing document consisting of five (5)
sheets including the present, was on the date above-mentioned, signed by the testators Macario Macrohon Ong
Ham and Victoriana Saavedra on all its sheets, in our presence at their request, in their presence, and in the
presence of each other we have signed our names as witnesses on all the sheets of said will.

The lower court solving the question raised by the parties in their agreement of facts, held that the one-half of
the property described in the will, all of lot No. 3057, cadastral case No. 6; one-half of the cash balance of the
final account to be rendered by the executor, and half of the proceeds of the sale of lots No. 34 and 35 of
Proceeding No. 8196, belong to Macario Macrohon Ong Ham; and as it appears from the will quoted, as well as
from the agreement dated March 25, 1926, that Victoriana Saavedra left no legitimate ascendants or
descendants at the time of her death Macario Macrohon Ong Ham, her widower, is, according to the provisions
of articles 837 of the Civil Code, entitled to the usufruct of one-half of the estate of the said Victoriana
Saavedra, consisting of one-half of the property described in the will, excluding lots No. 817 and 768 of
proceeding No. 7880, given to Segunda Saavedra with the consent of Macario Macrohon Ong Ham; of one-half
of the cash balance of the executor's final account, and of half of the proceeds of the sale of lots Nos. 34 and 35
in proceeding No. 8196, and said estate is adjudicated as follows: one-half of the same belongs in usufruct to
the widower Macario Macrohon Ong Ham, and the naked ownership of this half as well as the full ownership of
the other half is adjudicated to Victoriana Saavedra's heirs, named in the said agreement dated March 25, 1926,
in the following manner: sixteenths of the naked ownership of the one-half in usufruct and sixteenths of the
other half in full ownership, to Juan Saavedra; sixteenths of the naked ownership of the one-half in usufruct
ands sixteenths of the other half in full ownership, to Segunda Saavedra; and, sixteenths of the naked ownership
of the one-half in usufruct and sixteenths of the other half in full ownership to Teofilo Saavedra, Manuel
Saavedra, Victoriana Saavedra, Mariano Saavedra, Froilan Saavedra and Josefa Saavedra, children of Mateo
Saavedra, deceased brother of Victoriana Saavedra, in equal parts; and to Encarnacion Carpio and Macra
Carpio, daughters of Petrona Saavedra, deceased sister of Victoriana Saavedra, sixteenths of the naked
ownership of the one-half in usufruct and sixteenths of the other half in full ownership, in equal parts.

As regards lots Nos. 817 and 768 of proceeding No. 7880, given to Segunda Saavedra, the court adjudicates the
same to the said Segunda Saavedra, in accordance with the clauses on lines 99-111 of the will.

Finally, the court orders that the executor, after paying the inheritance tax, distribute among Victoriana
Saavedra's heirs named in the agreement of March 25, 1926, the part belonging to each of them as hereinabove
stated, and after this delivery is made and the inheritance tax, if any, is paid, this proceeding is to be considered
closed ipso facto.

Counsel for the executor appealed from this decision and assigns in his brief the following alleged errors as
committed by the lower court:

I. In holding in its auto, of November 26, 1926, that the deceased, Victoriana Saavedra, died partially intestate,
and did not dispose of all her property by the joint last will and testament executed by herself and her husband,
Macario Macrohon Ong Ham, and in not finding that under the terms of the aforesaid joint will the legatees,
Ong Ka Chiew and Ong Ka Jian, named therein, were entitled to receive her estate and participation in the
sixteen parcels of land devised under the said joint will, by the said spouses.

II. In holding that the brother and the sister of Victoriana Saavedra, by name, Juan Saavedra and Segundo
Saavedra; her nephews and nieces, by name, Teofilo Saavedra, Manuel Saavedra, Victoriana Saavedra, Mariano
Saavedra, Froilan Saavedra, Josefa Saavedra, Encarnacion Carpio and Macra Carpio, her next of kin were
entitled to receive any part of her estate and participation in the said sixteen parcels of land, devised to the
above named legatees, Ong Ka Chiew and Ong Ka Jian, under the terms of the said joint last will and testament.

The parts of the will pertinent to the questions raised by the appellant are:

We do agree jointly and individually that our properties above described be disposed of in the following
manner:

In case of the death of Macario Macrohon Ong Ham before Victoriana Saavedra, we hereby order that the
properties hereinafter described given to Ong Ka Chiew and Ong Ka Jian jointly, and should either of the two
die before Macario Macrohon Ong Ham, we order that all the said properties be given to the survivor, which
properties are described as follows:

(Here follows a description of 16 of the 19 lots that are also described in the will as conjugal property of the
testator and testatrix.)

In case that Victoriana Saavedra should survive Macario Macrohon Ong Ham, the lands and properties
described below shall belong exclusively to Victoriana Saavedra, to wit:

Lot No. 838 A, proceeding 7880, certificate No. 1257

Lot No. 817, proceeding 7880, certificate No. 1247
Lot No. 768, proceeding 7880, certificate No. 1105
Should Victoriana Saavedra die before Macario Macrohon Ong Ham, we order that lot No. 817 A,
proceeding No. 7880, certificate No. 1247, be adjudicated to Segunda Saavedra, widow, sister of Victoriana
Saavedra, free of all liens and encumbrances.

We also order that lot No. 768, proceeding No. 7880, certificate No. 1105, be adjudicated to Segunda Saavedra
and her heirs, on condition that she devote the products of the same to having masses said for the repose of the
soul of Victoriana Saavedra.

In case of the death of either of us, we order that the surviving spouse be appointed executor of this our last will
and testament.

Appellant alleges that the trial court erred in holding that Victoriana Saavedra died partly intestate. Article 658
of the Civil Code provides:

ART. 658. Succession is effected either by the will of man expressed by the testament or, in the absence of a
testament, by operation of law.

The first is called testamentary, the second legal succession.

It may also be effected partly by the will of man and partly by operation of law.

According to this, there are three ways in which succession may be effected: by the will of man, by the law, or
by both at the same time. In the first case the succession is called testamentary, because it is based on the last
will and testament, which is the orderly manifestation of the testator's will; in the second, it is called legal,
because it takes effect by operation of the law; and the third is called mixed, because it partakes of the character
of both testamentary and legal succession.

Commenting on the third mode of effecting succession, Mr. Manresa says: "The rule of indivisibility and
incompatibility was transferred to our laws from pure Romanism, and it remained in them until the XV Century,
when the law of the Ordenamiento previously cited repealed the maxim nemo pro parte testatus pro parte
intestatus decedere protest. This same repeal is confirmed in paragraph 3 of the article under consideration
(658), which prescribes that it may also be effected partly by the will of man and partly by operation of law, and
in articles 764 and 912 above cited which call the legal heirs to the enjoyment of the part of the inheritance not
disposed of by the testator in his will." (Vol. 5, 1921 ed., pp. 326, 327.)

This is a refutation of the appellant's argument that no one who has executed a will can die partly intestate. That
the rule of indivisibility of the testator's will invoked by the appellant does not hold good in this jurisdiction, is
shown, moreover, by articles 764 and 912 of the Civil Code. According to the first of these articles, a will is
valid even though it does not contain any institution of an heir, or if such institution does not include the entire
estate, and even though the person instituted does not accept the inheritance or is disqualified to inherit;
according to the second, one of the ways in which legal succession may take place is when the will does not
institute an heir to all or part of the property, or does not dispose of all that belongs to the testator, in which case
legal succession shall take place only with respect to the property which the testator has not disposed of.

Assuming that the joint will in question is valid, it follows that the deceased Victoriana Saavedra specified
therein that parcels 187 and 768 in proceeding No. 7880 be delivered as a legacy to her sister Segunda
Saavedra, the first parcel free of all liens and encumbrances, and the second on the condition that the legatee
devote the products of the same to having masses said for the repose to the testatrix's soul. As to the remaining
sixteen parcels, the testatrix disposed of her part in them conditionally, that is to say, in case her husband
Macario Macrohon Ong Ham died before she died, said parcels were to be awarded to her husband's nephews,
or to either of them in case one should have died before the said Macario Macrohon Ong Ham. The condition
imposed in the will as precedent to the vesting in the alleged legatees Ong Ka Chiew and Ong Ka Jian of the
right to the legacy, not having been complied with, the trial court found that the part of said property belonging
to the testatriz should be partitioned among the persons called on to succeed her under the law. We are of the
opinion that this finding is in accordance with the law, since, under article 791 of the Civil Code, conditions
imposed upon heirs and legatees shall be governed by the rules established for conditional obligations in all
matters not provided for by this section (articles 790 to 805). And, in accordance with article 1114 of the Code,
in conditional obligations the acquisition of rights, as well as the extinction or loss of those already acquired,
shall depend upon the occurrence of the event constituting the condition.

Another error assigned by the appellant consist in the trial court not having found that, under the terms of the
joint will, the legatees Ong Ka Chiew and Ong Ka Jian were entitled to receive the testatrix's share in the
sixteen parcels of land mentioned in said will.

The part of the will invoked by the appellant, states:

In case of the death of Macario Macrohon Ong Ham before Victoriana Saavedra, we hereby order that the
properties hereinafter described given to Ong Ka Chiew and Ong Ka Jian jointly, and should either of the two
die before Macario Macrohon Ong Ham, we order that all the said properties be given to the survivor.

The trial court, in interpreting this paragraph of the will in regard to legatees Ong Ka Chiew and Ong Ka Jian,
reached the right conclusion, and rightly, in our opinion, that it provides for the substitution of legatees in case
either of them should die before Macario Macrohon Ong Ham; and that the acquisition by these legatees of any
right to the property described in the will depended on the condition that Macario Macrohon Ong Ham died
before Victoriana Saavedra.

The appellant also assigns as error the holding of the trial court that the opponents, the brother, sister, nephews,
and nieces of the testatrix, were entitled to receive her share in the said sixteen parcels of land, given to the
legatees, Ong Ka Chiew and Ong Ka Jian, under the terms of the said joint will. Such a contention is untenable.
As we have said, the acquisition of right by the alleged legatees depends on the occurrence of the event
constituting the condition, that is, the death of Macario Macrohon Ong Ham prior to that of his wife; and this
condition not having been complied with, the said Ong Ka Chiew and Ong Ka Jian have not acquired any right,
and therefore the testatrix's estate is to be divided among her heirs in accordance with the law.

To the sixteen parcels of land to which reference is her made, that is, those given to the nephews of the testator,
should be added lot No. 838--A, proceeding No. 7880, certificate 1257, which the testatrix had reserved to
herself (together with lots 817 and 768), in case she survived her husband Macario Macrohon Ong Ham.

One-half of these seventeen parcels of land belong to the widower, Macario Macrohon Ong Ham, and the trial
court shall order the division of the other half, that is, the estate of the deceased Victoriana Saavedra, being one-
half of the conjugal property, between the widower and the opponents, as provided for in articles 945, 948 and
953 of the Civil Code. With this modification, the order appealed from is affirmed in all other respects. So
ordered.

Johnson, Street, Malcolm and Ostrand, JJ., concur.

Avancea, C.J. and Johns, J., dissent.
EN BANC

[G. R. No. 4275. March 23, 1909.]

PAULA CONDE, Plaintiff-Appellee, vs. ROMAN ABAYA, Defendant-Appellant.

DECISION

ARELLANO, C.J.:

From the hearing of the appeal interposed by Roman Abaya in the special proceedings brought in the Court of
First Instance of La Laguna for the settlement of the intestate estate and the distribution of the property of
Casiano Abaya it appears: chanrobles virtualawlibrary

I. As antecedents: chanrobles virtualawlibrary that Casiano Abaya, unmarried, the son of Romualdo
Abaya and Sabina Labadia, died on the 6th of April 1899; that Paula Conde, as the mother of the natural
children Jose and Teopista Conde, whom she states she had by Casiano Abaya, on the 6th of November, 1905,
moved the settlement of the said intestate succession; that an administrator having been appointed for the said
estate on the 25th of November, 1905, Roman Abaya, a son of the said Romualdo Abaya and Sabina Labadia,
the parents of the late Casiano Abaya, came forward and opposed said appointment and claimed it for himself
as being the nearest relative of the deceased; that this was granted by the court below on the 9th of January,
1906; that on the 17th of November, 1906, Roman Abaya moved that, after due process of law, the court
declare him to be the sole heir of Casiano Abaya, to the exclusion of all other persons, especially of Paula
Conde, and to be therefore entitled to take possession of all the property of said estate, and that it be adjudicated
to him; and that on November 22, 1906, the court ordered the publication of notices for the declaration of heirs
and distribution of the property of the estate.

II. That on the 28th of November, 1906, Paula Conde, in reply to the foregoing motion of Roman Abaya,
filed a petition wherein she stated that she acknowledged the relationship alleged by Roman Abaya, but that she
considered that her right was superior to his and moved for a hearing of the matter, and, in consequence of the
evidence that she intended to present she prayed that she be declared to have preferential rights to the property
left by Casiano Abaya, and that the same be adjudicated to her together with the corresponding products
thereof.

III. That the trial was held, both parties presenting documentary and oral evidence, and the court below
entered the following judgment: chanrobles virtualawlibrary

That the administrator of the estate of Casiana Abaya should recognize Teopista and Jose Conde as being
natural children of Casiano Abaya; that the Petitioner Paula Conde should succeed to the hereditary rights of
her children with respect to the inheritance of their deceased natural father Casiano Abaya; and therefore, it is
hereby declared that she is the only heir to the property of the said intestate estate, to the exclusion of the
administrator, Roman Abaya.
IV. That Roman Abaya excepted to the foregoing judgment, appealed to this court, and presented the
following statement of errors: chanrobles virtualawlibrary

1. The fact that the court below found that an ordinary action for the acknowledgment of natural children
under articles 135 and 137 of the Civil Code, might be brought in special probate proceedings.

2. The finding that after the death of a person claimed to be an unacknowledged natural child, the mother
of such presumed natural child, as heir to the latter, may bring an action to enforce the acknowledgment of her
deceased child in accordance with articles 135 and 137 of the Civil Code.

3. The finding in the judgment that the alleged continuous possession of the deceased children of Paula
Conde of the status of natural children of the late Casiano Abaya, has been fully proven in these proceedings;
and

4. On the hypothesis that it was proper to adjudicate the property of this intestate estate to Paula Conde,
as improperly found by the court below, the court erred in not having declared that said property should be
reserved in favor of relatives of Casiano Abaya to the third degree, and in not having previously demanded
securities from Paula Conde to guarantee the transmission of the property to those who might fall within the
reservation.

As to the first error assigned, the question is set up as to whether in special proceedings for the administration
and distribution of an intestate estate, an action might be brought to enforce the acknowledgment of the natural
child of the person from whom the inheritance is derived, that is to say, whether one might appear as heir on the
ground that he is a recognized natural child of the deceased, not having been so recognized by the deceased
either voluntarily or compulsory by reason of a preexisting judicial decision, but asking at the same time that, in
the special proceeding itself, he be recognized by the presumed legitimate heirs of the deceased who claim to be
entitled to the succession opened in the special proceeding.

According to section 782 of the Code of Civil Procedure

If there shall be a controversy before the Court of First Instance as to who the lawful heirs of the deceased
person are, or as to the distributive share to which each person is entitled under the law, the testimony as to such
controversy shall be taken in writing by the judge, under oath and signed by witness. Any party in interest
whose distributive share is affected by the determination of such controversy, may appeal from the judgment of
the Court of First Instance determining such controversy to the Supreme Court, within the time and in the
manner provided in the last preceding section.

This court has decided the present question in the manner shown in the case of Juana Pimental vs. Engracio
Palanca (5 Phil. Rep. 436.) cralaw

The main question with regard to the second error assigned, is whether or not the mother of a natural child now
deceased, but who survived the person who, it is claimed, was his natural father, also deceased, may bring an
action for the acknowledgment of the natural filiation in favor of such child in order to appear in his behalf to
receive the inheritance from the person who is supposed to be his natural father.

In order to decide in the affirmative the court below has assigned the following as the only
foundation: chanrobles virtualawlibrary
In resolving a similar question Manresa says: chanrobles virtualawlibrary An acknowledgment can only be
demanded by the natural child and his descendants whom it shall benefit, and should they be minors or
otherwise incapacitated, such person as legally represents them; the mother may ask it in behalf of her child so
long as he is under her authority. On this point no positive declaration has been made, undoubtedly because it
was not considered necessary. A private action is in question and the general rule must be followed. Elsewhere
the same author adds: chanrobles virtualawlibrary It may so happen that the child dies before four years have
expired after attaining majority, or that the document supporting his petition for acknowledgment is discovered
after his death, such death perhaps occurring after his parents had died, as is supposed by article 137, or during
their lifetime. In any case such right of action shall pertain to the descendants of the child whom the
acknowledgment may interest. (See Commentaries to arts. 135 and 137, Civil Code. Vol. I.) cralaw

The above doctrine, advanced by one of the most eminent commentators of the Civil Code, lacks legal and
doctrinal foundation. The power to transmit the right of such action by the natural child to his descendants
cannot be sustained under the law, and still less to his mother.

It is without any support in law because the rule laid down in the code is most positive, limiting in form, when
establishing the exception for the exercise of such right of action after the death of the presumed parents, as is
shown hereafter. It is not supported by any doctrine, because up to the present time no argument has been
presented, upon which even an approximate conclusion could be based.

Although the Civil Code considerably improved the condition of recognized natural children, granting them
rights and actions that they did not possess under the former laws, they were not, however, placed upon the
same plane as legitimate ones. The difference that separates these two classes of children is still great, as proven
by so many articles dealing with the rights of the family and with succession in relation to the members thereof.
It may be laid down as a legal maxim, that whatever the code does not grant to the legitimate children, or in
connection with their rights, must still less be understood as granted to recognized natural children or in
connection with their rights. There is not a single exception in its provisions.

If legitimacy is the attribute that constitutes the basis of the absolute family rights of the child, the
acknowledgment of the natural child is, among illegitimate ones, that which unites him to the family of the
father or the mother who recognizes him, and affords him a participation in the rights of the family, relatively
advantageous according to whether they are alone or whether they concur with other individuals of the family
of his purely natural father or mother.

Thus, in order to consider the spirit of the Civil Code nothing is more logical than to establish a comparison
between an action to claim the legitimacy, and one to enforce acknowledgment.

Art. 118. The action to claim its legitimacy may be brought by the child at any time of its lifetime and
shall be transmitted to its heirs, should it die during minority or in a state of insanity. In such cases the heirs
shall be allowed a period of five years in which to institute the action.

The action already instituted by the child is transmitted by its death to the heirs, if it has not lapsed before then.

Art. 137. The actions for the acknowledgment of natural children can be instituted only during the life
of the presumed parents, except in the following cases: chanrobles virtualawlibrary

1. If the father or mother died during the minority of the child, in which case the latter may institute the
action before the expiration of the first four years of its majority.
2. If, after the death of the father or mother, some instrument, before unknown, should be discovered in
which the child is expressly acknowledged.

In this case the action must be instituted within the six months following the discovery of such instrument.

On this supposition the first difference that results between one action and the other consists in that the right of
action for legitimacy lasts during the whole lifetime of the child, that is, it can always be brought against the
presumed parents or their heirs by the child itself, while the right of action for the acknowledgment of a natural
child does not last his whole lifetime, and, as a general rule, it cannot be instituted against the heirs of the
presumed parents, inasmuch as it can be exercised only during the life of the presumed parents.

With regard to the question at issue, that is, the transmission to the heirs of the presumed parents of the
obligation to admit the legitimate filiation, or to recognize the natural filiation, there exists the most radical
difference in that the former continues during the life of the child who claims to be legitimate, and he may
demand it either directly and primarily from the said presumed parents, or indirectly and secondarily from the
heirs of the latter; while the second does not endure for life; as a general rule, it only lasts during the life of the
presumed parents. Hence the other difference, derived as a consequence, that an action for legitimacy is always
brought against the heirs of the presumed parents in case of the death of the latter, while the action for
acknowledgment is not brought against the heirs of such parents, with the exception of the two cases prescribed
by article 137 transcribed above.

So much for the passive transmission of the obligation to admit the legitimate filiation, or to acknowledge the
natural filiation.

As to the transmission to the heirs of the child of the latters action to claim his legitimacy, or to obtain the
acknowledgment of his natural filiation, it is seen that the code grants it in the first case, but not the second. It
contains provisions for the transmission of the right of action which, for the purpose of claiming his legitimacy
inheres in the child, but it does not say a word with regard to the transmission of the right to obtain the
acknowledgment of the natural filiation.

Therefore, the respective corollary of each of the two above-cited articles is: chanrobles virtualawlibrary (1)
That the right of action which devolves upon the child to claim his legitimacy under article 118, may be
transmitted to his heirs in certain cases designated in the said article; (2) That the right of action for the
acknowledgment of natural children to which article 137 refers, can never be transmitted, for the reason that the
code makes no mention of it in any case, not even as an exception.

It is most illogical and contrary to every rule of correct interpretation, that the right of action to secure
acknowledgment by the natural child should be presumed to be transmitted, independently, as a rule, to his
heirs, while the right of action to claim legitimacy from his predecessor is not expressly, independently, or, as a
general rule, conceded to the heirs of the legitimate child, but only relatively and as an exception. Consequently,
the pretension that the right of action on the part of the child to obtain the acknowledgment of his natural
filiation is transmitted to his descendants is altogether unfounded. No legal provision exists to sustain such
pretension, nor can an argument of presumption be based on the lesser claim when there is no basis for the
greater one, and when it is only given as an exception in well-defined cases. It is placing the heirs of the natural
child on a better footing than the heirs of the legitimate one, when, as a matter of fact, the position of a natural
child is no better than, nor even equal to, that of a legitimate child.
From the express and precise precepts of the code the following conclusions are derived: chanrobles
virtualawlibrary

The right of action that devolves upon the child to claim his legitimacy lasts during his whole life, while the
right to claim the acknowledgment of a natural child lasts only during the life of his presumed parents.

Inasmuch as the right of action accruing to the child to claim his legitimacy lasts during his whole life, he may
exercise it either against the presumed parents, or their heirs; while the right of action to secure the
acknowledgment of a natural child, since it does not last during his whole life, but depends on that of the
presumed parents, as a general rule can only be exercised against the latter.

Usually the right of action for legitimacy devolving upon the child is of a personal character and pertains
exclusively to him, only the child may exercise it at any time during his lifetime. As an exception, and in three
cases only, it may be transmitted to the heirs of the child, to wit, if he died during his minority, or while insane,
or after action had been already instituted.

An action for the acknowledgment of a natural child may, as an exception, be exercised against the heirs of the
presumed parents in two cases: chanrobles virtualawlibrary first, in the event of the death of the latter during the
minority of the child, and second, upon the discovery of some instrument of express acknowledgment of the
child, executed by the father or mother, the existence of which was unknown during the life of the latter.

But as such action for the acknowledgment of a natural child can only be exercised by him. It cannot be
transmitted to his descendants, or to his ascendants.

In support of the foregoing the following authorities may be cited: chanrobles virtualawlibrary

Sanchez Roman, in his Treatise on Civil Law, propounds the question as to whether said action should be
considered transmissive to the heirs or descendants of the natural child, whether he had or had not exercised it
up to the time of his death, and decides it as follows;

There is an entire absence of legal provisions, and at most, it might be deemed admissible as a solution, that
the right of action to claim the acknowledgment of a natural child is transmitted by analogy to his heirs on the
same conditions and terms that it is transmitted to the descendants of a legitimate child, to claim his legitimacy,
under article 118, but nothing more; because on this point nothing warrants placing the heirs of a natural child
on a better footing than those of the legitimate child, and even to compare them would not fail to be a strained
and questionable matter, and one of great difficulty for decision by the courts, for the simple reason that for the
heirs of the legitimate child, the said article 118 exists, while for those of the natural child, as we have said,
there is no provision in the code authorizing the same, although on the other hand there is none that prohibits it.
(Vol. V.) cralaw

Diaz Guijarro and Martinez Ruiz in their work on The Civil Code as construed by the supreme court of Spain,
commenting upon article 137, say: chanrobles virtualawlibrary

Article 118, taking into account the privileges due to the legitimacy of children, grants them the right to claim
said legitimacy during their lifetime, and even authorizes the transmission of said right for the space of five
years to the heirs thereof, if the child die during his minority or in a state of insanity. But as article 137 is based
on the consideration that in the case of a natural child, ties are less strong and sacred in the eyes of the law, it
does not fix such a long and indefinite period for the exercise of the action; it limits it to the life of the parents,
excepting in the two cases mentioned in said article; and it does not allow, as does article 118, the action to pass
on to the heirs, inasmuch as, although it does not prohibit it, and for that reason it might be deemed on general
principles of law to consent to it, such a supposition is inadmissible for the reason that a comparison of both
articles shows that the silence of the law in the latter case is not, nor can it be, an omission, but a deliberate
intent to establish a wide difference between the advantages granted to a legitimate child and to a natural one.

(Ibid., Vol. II, 171.) cralaw

Navarro Amandi (Cuestionario del Codigo Civil) raises the question: chanrobles virtualawlibrary Can the heirs
of a natural child claim the acknowledgment in those cases wherein the father or mother are under obligation to
acknowledge? And says: chanrobles virtualawlibrary

Opinions are widely divergent. The court of Rennes held (on April 13, 1844) that the right of investigation
forms a part of the estate of the child, and along with his patrimony is transmitted to his heirs. The affirmation is
altogether too categorical to be admissible. If it were correct the same thing would happen as when the
legitimacy of a child is claimed, and as already seen, the right of action to demand the legitimacy is not
transmitted to the heirs in every case and as an absolute right, but under certain limitations and circumstances.
Now, were we to admit the doctrine of the court of Rennes, the result would be that the claim for natural
filiation would be more favored than one for legitimate filiation. This would be absurd, because it cannot be
conceived that the legislator should have granted a right of action to the heirs of the natural child, which is only
granted under great limitations and in very few cases to those of a legitimate one. Some persons insist that the
same rules that govern legitimate filiation apply by analogy to natural filiation, and that in this conception the
heirs of the natural child are entitled to claim it in the cases prescribed by article 118. The majority, however,
are inclined to consider the right to claim acknowledgment as a personal right, and consequently, not
transmissive to the heirs. Really there are not legal grounds to warrant the transmission. (Vol. 2, 229.) cralaw

In a decision like the present one it is impossible to bring forward the argument of analogy for the purpose of
considering that the heirs of the natural child are entitled to the right of action which article 118 concedes to the
heirs of the legitimate child. The existence of a provision for the one case and the absence thereof for the other
is a conclusive argument that inclusio unius est exclusio alterius, and it cannot be understood that the provision
of law should be the same when the same reason does not hold in the one case as in the other.

The theory of the law of transmission is also entirely inapplicable in this case. This theory, which in the Roman
Law expressed the general rule that an heir who did not accept an inheritance during his lifetime was
incapacitated from transmitting it to his own heirs, included at the same time the idea that if the inheritance was
not transmitted because the heir did not possess it, there were, however, certain things which the heir held and
could transmit. Such was the law and the right to accept the inheritance, for the existing reason that all rights,
both real and personal, shall pass to the heir; quia haeres representat defunctum in omnibus et per omnia.
According to article 659 of the Civil Code, the inheritance includes all the property, rights, and obligations of a
person, which are not extinguished by his death. If the mother is the heir of her natural child, and the latter,
among other rights during his lifetime was entitled to exercise an action for his acknowledgment against his
father, during the life of the latter, or after his death in some of the excepting cases of article 137, such right,
which is a portion of his inheritance, is transmitted to his mother as being his heir, and it was so understood by
the court of Rennes when it considered the right in question, not as a personal and exclusive right of the child
which is extinguished by his death, but as any other right which might be transmitted after his death. This right
of supposed transmission is even less tenable than that sought to be sustained by the argument of analogy.
The right of action pertaining to the child to claim his legitimacy is in all respects superior to that of the child
who claims acknowledgment as a natural child. And it is evident that the right of action to claim his legitimacy
is not one of those rights which the legitimate child may transmit by inheritance to his heirs; it forms no part of
the component rights of his inheritance. If it were so, there would have been no necessity to establish its
transmissibility to heirs as an exception in the terms and conditions of article 118 of the code. So that, in order
that it may constitute a portion of the childs inheritance, it is necessary that the conditions and the terms
contained in article 118 shall be present, since without them, the right that the child held during his lifetime,
being personal and exclusive in principle, and therefore, as a general rule not susceptible of transmission, would
and should have been extinguished by his death. Therefore, where no express provision like that of article 118
exists, the right of action for the acknowledgment of a natural child is, in principle and without exception,
extinguished by his death, and cannot be transmitted as a portion of the inheritance of the deceased child.

On the other hand, it said right of action formed a part of the childs inheritance, it would be necessary to
establish the doctrine that the right to claim such an acknowledgment from the presumed natural father and
from his heirs is an absolute right of the heirs of the child, not limited by certain circumstances as in the case of
the heirs of a legitimate child; and if it is unreasonable to compare a natural child with a legitimate one to place
the heirs of a natural child and his inheritance on a better footing than those of a legitimate child would not only
be unreasonable, but, as stated in one of the above citations, most absurd and illegal in the present state of the
law and in accordance with the general principles thereof.

For all of the foregoing reasons we hereby reverse the judgment appealed from in all its parts, without any
special ruling as to the costs of this instance.

Mapa, Johnson, Carson and Willard, JJ., concur.

Separate Opinions

TORRES, J., dissenting: chanrobles virtualawlibrary

The questions arising from the facts and points of law discussed in this litigation between the parties thereto,
decided in the judgment appealed from, and set up and discussed in this instance by the said parties in their
respective briefs, are subordinate in the first place to the main point, submitted among others to the decision of
this court, that is, whether the right of action brought to demand from the natural father, or from his heirs, the
acknowledgment of the natural child which the former left at his death was, by operation of the law, transmitted
to the natural mother by reason of the death of the said child acknowledged by her.

The second error assigned by the Appellant in his brief refers exclusively to this important point of law.

Article 846 of the Civil Code prescribes: chanrobles virtualawlibrary

The right of succession which the law grants natural children extends reciprocally in similar cases to the
natural father or mother.

Article 944 reads: chanrobles virtualawlibrary

If the acknowledged natural or legitimized child should die without issue, either legitimate or acknowledged
by it, the father or mother who acknowledged it shall succeed to its entire estate, and if both acknowledged it
and are alive, they shall inherit from it share and share alike.

It cannot be inferred from the above legal provisions that from the right of succession which the law grants the
natural father or mother upon the death of their natural child, the right of the heirs of any of the said parents to
claim the acknowledgment of the natural child is excluded. No article is to be found in the Civil Code that
expressly provides for such exclusion or elimination of the right of the heirs of the deceased child to claim his
acknowledgment.

If under article 659 of said code, the inheritance includes all the property, rights, and obligations of a person,
which are not extinguished by his death, it is unquestionable that among such rights stands that which the
natural child had, while alive, to claim his acknowledgment as such from his natural father, or from the heirs of
the latter. There is no reason or legal provision whatever to prevent the consideration that the right to claim
acknowledgment of the filiation of a deceased child from his natural father, or from the heirs of the latter, is
included in the hereditary succession of the deceased child in favor of his natural mother.

It is to be regretted that such an eminent writer as Manresa is silent on this special point; or that he is not very
explicit in his comments on article 137 of the Civil Code. Among the various noted writers on law, Professor
Sanchez Roman is the only one who has given his opinion in a categorical manner as to whether or not the right
of action for the acknowledgment of a deceased natural child shall be considered transmissive to his heirs, as
may be seen from the following: chanrobles virtualawlibrary

In order to complete the explanation of this article 137 of the Civil Code, three points must be
decided: chanrobles virtualawlibrary (1) Against whom shall an action for acknowledgment be brought under
the cases and terms to which the two exceptions indicated in paragraphs 1 and 2 of article 137 refer? (2) Who is
to represent the miner in bringing this action when neither the father nor the mother has acknowledged him? (3)
Should this right of action be considered as transmitted to the heirs or descendants of the natural child whether
or not it was exercised at the time of his death?

With respect to the third, there is an entire absence of legal provisions, and at most, it might be deemed
admissible as a solution, that the right of action to claim the acknowledgment of a natural child is transmitted by
analogy to his heirs on the same conditions and terms that it is transmitted to the descendants of the legitimate
child, to claim his legitimacy, under article 118, but no more; because on this point nothing warrants placing the
heirs of a natural child on a better footing than those of the legitimate child, and even to compare them would
not fail to be a strained and questionable matter, and one of great difficulty for decision by the courts, for the
simple reason that for the heirs of the legitimate child the said article 118 exists, while for those of the natural
child, as we have said, there is no provision in the code authorizing the same, although on the other hand there
is none that prohibits it.

Certainly there is no article in the Civil Code, or any special law that bars the transmission to the heirs of a
natural child, particularly to his natural mother, of the right of action to claim the acknowledgment of said
natural child from the heirs of his deceased natural father.

According to the above-cited article 944 of the Civil Code, the only persons designated to succeed to the
intestate estate of a natural child who died during minority or without issue are its natural father or mother who
acknowledged it; consequently if by operation of the law his parents are his legal successors or heirs, it is
unquestionable that by reason of the childs death the property, rights, and obligations of the deceased minor
were, as a matter of fact, transmitted to them, among which was the right to demand the acknowledgment of the
said deceased natural child from the heirs of the deceased natural father or mother, respectively, on account of
having enjoyed uninterruptedly the status of natural child of the said deceased parents. (Arts. 135 and 136, Civil
Code.) cralaw

At the death of the children, Teopista in 1902, and Jose in 1903, during their minority, and after the death of
their natural father which took place in 1899, the natural mother of the said minors, Paula Conde, succeeded
them in all of their property and rights, among which must necessarily appear and be included the right of action
to claim the acknowledgment of said two children from the heirs of Icasiano Abaya, their deceased natural
father. There is no legal provision or precept whatever excluding such right from those which, by operation of
the law, were transmitted to the mother, Paula Conde, or expressly declaring that the said right to claim such
acknowledgment is extinguished by the death of the natural children.

It is true that, as a general rule, an action for acknowledgment cannot be brought by a surviving natural child
after the death of his parents, except in the event that he was a minor at the time of the death of either of his
parents, as was the case with the minors Teopista and Jose Conde, who, if living, would unquestionably be
entitled to institute an action for acknowledgment against the presumed heirs of their natural father; and as there
is no law that provides that said right is extinguished by the death of the same, and that the mother did not
inherit it from the said minors, it is also unquestionable that Paula Conde, the natural mother and successor to
the rights of said minors, is entitled to exercise the corresponding action for acknowledgment.

If the natural mother had no right of action against the heirs of the natural father, for the acknowledgment of her
natural child, the unlimited and unconditional reciprocity established by article 846 of the code would neither be
true nor correct. It should be noticed that the relation of paternity and that of filiation between the above-
mentioned father and children are both natural in character; therefore, the intestate succession of the said
children of Paula Conde is governed exclusively by articles 944 and 945 of the said code.

It is true that nothing is provided by article 137 with reference to the transmission to the natural mother of the
right to claim the acknowledgment of her natural children, but, as Sanchez Roman says, it does not expressly
prohibit it; and as opposed to the silence of the said article, we find the provisions of articles 846 and 944 of the
Civil code, which expressly recognized the right of the natural mother to succeed her natural child, a right
which is transmitted to her by operation of law from the moment that the child ceases to exist.

The question herein does not bear upon the right of a child to claim his legitimacy, as provided in article 118 of
the code, nor is it claimed that the rights of natural children and of their mother are equal to those of legitimate
ones, even by analogy.

The foundations of this opinion are based solely on the provisions of the above-mentioned articles of the code,
and I consider that they are sustainable so long as it is not positively proven that the so often-mentioned right of
action for acknowledgment is extinguished by the death of the minor natural child, and is not transmitted to the
natural mother by express declaration or prohibition of the law, together with the property and other rights in
the intestate succession.

In view of the considerations above set forth it is my opinion that it should be held: chanrobles
virtualawlibrary That Paula Conde, as the natural mother and sole heir of her children Teopista and Jose, was
and is entitled to the right to institute proceedings to obtain the acknowledgment of the latter as natural children
of the late Icasiano Abaya, from Roman Abaya, as heir and administrator of the estate of the said Icasiano
Abaya; and that the said Teopista and Jose who died during their minority, three years after the death of their
father, should be considered and acknowledged as such natural children of the latter, for the reason that while
living they uninterruptedly enjoyed the status of his natural children. The judgment appealed from should be
affirmed without any special ruling as to costs.

With regard to the declaration that the property of the late Icasiano, which Paula Conde might take, are of a
reservable character, together with the other matter contained in the third error assigned by the Appellant to the
said judgment, the writer withholds his opinion until such time as the question may be raised between the
parties in proper form.

G.R. No. L-40789 February 27, 1987

INTESTATE ESTATE OF PETRA V. ROSALES, IRENEA C. ROSALES, petitioner,

vs.
FORTUNATO ROSALES, MAGNA ROSALES ACEBES, MACIKEQUEROX ROSALES and
ANTONIO ROSALES,respondents.

Jose B. Echaves for petitioner.

Jose A. Binghay and Paul G. Gorres for respondents.

GANCAYCO, J.:

In this Petition for Review of two (2) Orders of the Court of First Instance of Cebu the question raised is
whether the widow whose husband predeceased his mother can inherit from the latter, her mother-in-law.

It appears from the record of the case that on February 26, 1971, Mrs. Petra V. Rosales, a resident of Cebu City,
died intestate. She was survived by her husband Fortunate T. Rosales and their two (2) children Magna Rosales
Acebes and Antonio Rosales. Another child, Carterio Rosales, predeceased her, leaving behind a child,
Macikequerox Rosales, and his widow Irenea C. Rosales, the herein petitioner. The estate of the dismissed has
an estimated gross value of about Thirty Thousand Pesos (P30,000.00).

On July 10, 1971, Magna Rosales Acebes instituted the proceedings for the settlement of the estate of the
deceased in the Court of First Instance of Cebu. The case was docketed as Special Proceedings No. 3204-R.
Thereafter, the trial court appointed Magna Rosales Acebes administratrix of the said estate.

In the course of the intestate proceedings, the trial court issued an Order dated June 16, 1972 declaring the
following in individuals the legal heirs of the deceased and prescribing their respective share of the estate

Fortunata T. Rosales (husband), 1/4; Magna R. Acebes (daughter), 1/4; Macikequerox Rosales, 1/4; and
Antonio Rosales son, 1/4.
This declaration was reiterated by the trial court in its Order I dated February 4, 1975.

These Orders notwithstanding, Irenea Rosales insisted in getting a share of the estate in her capacity as the
surviving spouse of the late Carterio Rosales, son of the deceased, claiming that she is a compulsory heir of her
mother-in-law together with her son, Macikequerox Rosales.

Thus, Irenea Rosales sought the reconsideration of the aforementioned Orders. The trial court denied her plea.
Hence this petition.

In sum, the petitioner poses two (2) questions for Our resolution petition. First is a widow (surviving spouse)
an intestate heir of her mother-in-law? Second are the Orders of the trial court which excluded the widow
from getting a share of the estate in question final as against the said widow?

Our answer to the first question is in the negative.

Intestate or legal heirs are classified into two (2) groups, namely, those who inherit by their own right, and those
who inherit by the right of representation. 1 Restated, an intestate heir can only inherit either by his own right, as
in the order of intestate succession provided for in the Civil Code, 2 or by the right of representation provided
for in Article 981 of the same law. The relevant provisions of the Civil Code are:

Art. 980. The children of the deceased shall always inherit from him in their own right, dividing the inheritance
in equal shares.

Art. 981. Should children of the deceased and descendants of other children who are dead, survive, the former
shall inherit in their own right, and the latter by right of representation.

Art. 982. The grandchildren and other descendants shag inherit by right of representation, and if any one of
them should have died, leaving several heirs, the portion pertaining to him shall be divided among the latter in
equal portions.

Art. 999. When the widow or widower survives with legitimate children or their descendants and illegitimate
children or their descendants, whether legitimate or illegitimate, such widow or widower shall be entitled to the
same share as that of a legitimate child.

There is no provision in the Civil Code which states that a widow (surviving spouse) is an intestate heir of her
mother-in-law. The entire Code is devoid of any provision which entitles her to inherit from her mother-in- law
either by her own right or by the right of representation. The provisions of the Code which relate to the order of
intestate succession (Articles 978 to 1014) enumerate with meticulous exactitude the intestate heirs of a
decedent, with the State as the final intestate heir. The conspicuous absence of a provision which makes a
daughter-in-law an intestate heir of the deceased all the more confirms Our observation. If the legislature
intended to make the surviving spouse an intestate heir of the parent-in-law, it would have so provided in the
Code.

Petitioner argues that she is a compulsory heir in accordance with the provisions of Article 887 of the Civil
Code which provides that:

Art. 887. The following are compulsory heirs:

(1) Legitimate children and descendants, with respect to their legitimate parents and ascendants;
(2) In default of the foregoing, legitimate parents and ascendants, with respect to their legitimate children and
descendants;

(3) The widow or widower;

(4) Acknowledged natural children, and natural children by legal fiction;

(5) Other illegitimate children referred to in article 287;

Compulsory heirs mentioned in Nos. 3, 4 and 5 are not excluded by those in Nos. 1 and 2; neither do they
exclude one another.

In all cases of illegitimate children, their filiation must be duly proved.

The father or mother of illegitimate children of the three classes mentioned, shall inherit from them in the
manner and to the extent established by this Code.

The aforesaid provision of law 3 refers to the estate of the deceased spouse in which case the surviving spouse
(widow or widower) is a compulsory heir. It does not apply to the estate of a parent-in-law.

Indeed, the surviving spouse is considered a third person as regards the estate of the parent-in-law. We had
occasion to make this observation in Lachenal v. Salas, 4 to Wit:

We hold that the title to the fishing boat should be determined in Civil Case No. 3597 (not in the intestate
proceeding) because it affects the lessee thereof, Lope L. Leoncio, the decedent's son-in-law, who, although
married to his daughter or compulsory heir, is nevertheless a third person with respect to his estate. ...
(Emphasis supplied).

By the same token, the provision of Article 999 of the Civil Code aforecited does not support petitioner's claim.
A careful examination of the said Article confirms that the estate contemplated therein is the estate of the
deceased spouse. The estate which is the subject matter of the intestate estate proceedings in this case is that of
the deceased Petra V. Rosales, the mother-in-law of the petitioner. It is from the estate of Petra V. Rosales that
Macikequerox Rosales draws a share of the inheritance by the right of representation as provided by Article 981
of the Code.

The essence and nature of the right of representation is explained by Articles 970 and 971 of the Civil
Code, viz

Art. 970. Representation is a right created by fiction of law, by virtue of which the representative is raised to the
place and the degree of the person represented, and acquires the rights which the latter would have if he were
living or if he could have inherited.

Art. 971. The representative is called to the succession by the law and not by the person represented. The
representative does not succeed the person represented but the one whom the person represented would have
succeeded. (Emphasis supplied.)

Article 971 explicitly declares that Macikequerox Rosales is called to succession by law because of his blood
relationship. He does not succeed his father, Carterio Rosales (the person represented) who predeceased his
grandmother, Petra Rosales, but the latter whom his father would have succeeded. Petitioner cannot assert the
same right of representation as she has no filiation by blood with her mother-in-law.
Petitioner however contends that at the time of the death of her husband Carterio Rosales he had an inchoate or
contingent right to the properties of Petra Rosales as compulsory heir. Be that as it may, said right of her
husband was extinguished by his death that is why it is their son Macikequerox Rosales who succeeded from
Petra Rosales by right of representation. He did not succeed from his deceased father, Carterio Rosales.

On the basis of the foregoing observations and conclusions, We find it unnecessary to pass upon the second
question posed by the petitioner.

Accordingly, it is Our considered opinion, and We so hold, that a surviving spouse is not an intestate heir of his
or her parent-in-law.

WHEREFORE, in view of the foregoing, the Petition is hereby DENIED for lack of merit, with costs against
the petitioner. Let this case be remanded to the trial-court for further proceedings.

SO ORDERED.

Yap (Chairman), Narvasa, Melencio-Herrera, Cruz, Feliciano and Sarmiento, JJ., concur.

Footnotes

1 III Tolentino, Commentaries and Jurisprudence on the Civil Code of the Philippines 461, 1979 ed.

2 Articles 978 to 1014.

3 Art. 887 (3), Civil Code.

4 71 SCRA 262, 265 L-42257, June 14, 1976.

.R. No. L-47799 June 13, 1941

Administration of the estate of Agripino Neri y Chavez. ELEUTERIO NERI, ET AL., petitioners,
vs.
IGNACIA AKUTIN AND HER CHILDREN, respondents.

Ozamiz & Capistrano for petitioners.

Gullas, Leuterio, Tanner & Laput for respondents.

MORAN, J.:

Agripino Neri y Chavez, who died on December 12, 1931, had by his first marriage six children named
Eleuterio, Agripino, Agapito, Getulia, Rosario and Celerina; and by his second marriage with Ignacia Akutin,
five children named Gracia, Godofredo, Violeta, Estela Maria, and Emma. Getulia, daughter in the first
marriage, died on October 2, 1923, that is, a little less than eight years before the death of said Agripino Neri y
Chavez, and was survived by seven children named Remedios, Encarnacion, Carmen, Trinidad, Luz, Alberto
and Minda. In Agripino Neri's testament, which was admitted to probate on March 21, 1932, he willed that his
children by the first marriage shall have no longer any participation in his estate, as they had already received
their corresponding shares during his lifetime. At the hearing for the declaration of heirs, the trial court found,
contrary to what the testator had declared in his will, that all his children by the first and second marriages
intestate heirs of the deceased without prejudice to one-half of the improvements introduced in the properties
during the existence of the last conjugal partnership, which should belong to Ignacia Akutin. The Court of
Appeals affirmed the trial court's decision with the modification that the will was "valid with respect to the two-
thirds part which the testator could freely dispose of. "This judgment of the Court of Appeals is now sought to
be reviewed in this petition forcertiorari.

The decisive question here raised is whether, upon the foregoing facts, the omission of the children of the first
marriage annuls the institution of the children of the first marriage as sole heirs of the testator, or whether the
will may be held valid, at least with respect to one-third of the estate which the testator may dispose of as legacy
and to the other one-third which he may bequeath as betterment, to said children of the second marriage.

The Court of Appeals invoked the provisions of article 851 of the Civil Code, which read in part as follows:

Disinheritance made without a statement of the cause, or for a cause the truth of which, if contradicted, is not
proven, ... shall annul the institution of the heir in so far as it prejudices the person disinherited; but the legacies,
betterments, and other testamentary dispositions, in so far as they do no encroach upon the legitime, shall be
valid.
The appellate court thus seemed to have rested its judgment upon the impression that the testator had intended
to disinherit, though ineffectively, the children of the first marriage. There is nothing in the will that supports
this conclusion. True, the testator expressly denied them any share in his estate; but the denial was predicated,
not upon the desire to disinherit, but upon the belief, mistaken though it was, that the children by the first
marriage had already received more than their corresponding shares in his lifetime in the form of advancement.
Such belief conclusively negatives all inference as to any intention to disinherit, unless his statement to that
effect is prove to be deliberately fictitious, a fact not found by the Court of Appeals. The situation contemplated
in the above provision is one in which the purpose to disinherit is clear, but upon a cause not stated or not
proved, a situation which does not obtain in the instant case.

The Court of Appeals quotes Manresa thus:

En el terreno de los principios, la solucion mas justa del problema que hemos hecho notar al comentar el
articulo, seria distinguir el caso en que el heredero omitido viviese al otorgarse el testamento, siendo conocida
su existencia por el testador, de aquel en que, o naciese despues, o se ignorase su existencia, aplicando en el
primer caso la doctrina del articulo 851, y en el segundo la del 814. (6 Manresa, 354-355.)

But it must be observed that this opinion is founded on mere principles (en el terreno de los principios) and not
on the express provisions of the law. Manresa himself admits that according to law, "no existe hoy cuestion
alguna en esta materia: la pretericion produce siempre los mismos efectos, ya se refiera a personas vivas al
hacer el testamento o nacidas despues. Este ultimo grupo solo puede hacer relacion a los descendientes
legitimos, siempre que ademas tengan derecho a legitima." (6 Manresa, 381.)

Appellants, on the other hand, maintain that the case is one of voluntary preterition of four of the children by the
first marriage, and of involuntary preterition of the children by the deceased Getulia, also of the first marriage,
and is thus governed by the provisions of article 814 of the Civil Code, which read in part as follows:

The preterition of one or all of the forced 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 void the institution of heir; but the legacies and betterments
shall be valid, in so far as they are not inofficious.

Preterition consists in the omission in the testator's will of the forced heirs or anyone of them, either because
they are not mentioned therein, or, though mentioned, they are neither instituted as heirs nor are expressly
disinherited.(Cf. 6 Manresa, 346.) In the instant case, while the children of the first marriage were mentioned in
the will, they were not accorded any share in the heriditary property, without expressly being disinherited. It is,
therefore, a clear case of preterition as contended by appellants. The omission of the forced heirs or anyone of
them, whether voluntary or involuntary, is a preterition if the purpose to disinherit is not expressly made or is
not at least manifest.

Except as to "legacies and betterments" which "shall be valid in so far as they are not inofficious" (art. 814 of
the Civil Code), preterition avoids the institution of heirs and gives rise to intestate succession. (Art. 814, Civil
Code; Decisions of the Supreme Court of Spain of June 17, 1908 and February 27, 1909.) In the instant case, no
such legacies or betterments have been made by the testator. "Mejoras" or betterments must be expressly
provided, according to articles 825 and 828 of the Civil Code, and where no express provision therefor is made
in the will, the law would presume that the testator had no intention to that effect. (Cf. 6 Manresa, 479.) In the
will here in question, no express betterment is made in favor of the children by the second marriage; neither is
there any legacy expressly made in their behalf consisting of the third available for free disposal. The whole
inheritance is accorded the heirs by the second marriage upon the mistaken belief that the heirs by the first
marriage have already received their shares. Were it not for this mistake, the testator's intention, as may be
clearly inferred from his will, would have been to divide his property equally among all his children.

Judgment of the Court of Appeals is reversed and that of the trial court affirmed, without prejudice to the
widow's legal usufruct, with costs against respondents.

Avancea, C.J., Diaz, Laurel and Horrilleno, JJ., concur.