Republic of the Philippines

SUPREME COURT

Manila

EN BANC

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.

The Lawphil Project - Arellano Law Foundation

Case Digest: Uson v. Del Rosario

92 P 530

FACTS:

This is an action for recovery of the ownership and possession of five (5) parcels of land in Pangasinan, filed
by Maria Uson against Maria del Rosario and her four illegit children. 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 Uson and her husband,
executed a public document whereby they agreed to separate as husband and wife and, in consideration of
which Uson was given a parcel of land and in return she renounced her right to inherit any other property that
may be left by her husband upon his death. CFI found for Uson. Defendants appealed.

ISSUE:

W/N Uson has a right over the lands from the moment of death of her husband.

W/N the illegit children of deceased and his common-law wife have successional rights.

HELD:

Yes. There is no dispute that Maria Uson, 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, was merely a
common-law wife with whom she had four illegitimate children with the deceased. 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 (Art 777 NCC).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”. 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, cannot be entertained for the simple reason that future inheritance cannot be
the subject of a contract nor can it be renounced.

No. The provisions of the NCC shall be given retroactive effect even though the event which gave rise to
them may have occurred under the prior legislation only if no vested rights are impaired. Hence, since the right
of ownership of Maria Uson over the lands in question became vested in 1945 upon the death of her late
husband, 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.

FACTS

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. Maria Uson sought to recover
lands held by Maria del Rosario who had four illegitimate children with Nebreda, which the latter contends
that her children are given the status and rights of natural children and are entitled to the successional rights,
and because these successional rights were declared for the first time in the new code, they shall be given
retroactive effect.

ISSUE

Whether or not the illegitimate children may have successional rights under the new Civil Code by way of its
retroactive effect.

RULING

NO. 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. The law 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.
 Borja v. Borja

46 SCRA 577

FACTS:

Francisco de Borja filed a petition for probate of the will of his wife who died, Josefa Tangco, with the CFI of
Rizal. He was appointed executor and administrator, until he died; his son Jose became the sole administrator.
Francisco had taken a 2nd wife Tasiana before he died; she instituted testate proceedings with the CFI of
Nueva Ecija upon his death and was appointed special administatrix. Jose and Tasiana entered upon a
compromise agreement, but Tasiana opposed the approval of the compromise agreement. She argues that it
was no valid, because the heirs cannot enter into such kind of agreement without first probating the will of
Francisco, and at the time the agreement was made, the will was still being probated with the CFI of Nueva
Ecija.

ISSUE:

W/N the compromise agreement is valid, even if the will of Francisco has not yet been probated.

HELD:

YES, the compromise agreement is valid.

The agreement stipulated that Tasiana will receive P800,000 as full payment for her hereditary share in the
estate of Francisco and Josefa.

There was here no attempt to settle or distribute the estate of Francisco de Borja among the heirs thereto
before the probate of his will. The clear object of the contract was merely the conveyance by Tasiana
Ongsingco of any and all her individual share and interest, actual or eventual, in the estate of Francisco de
Borja and Josefa Tangco. There is no stipulation as to any other claimant, creditor or legatee.

And as a hereditary share in a decedent’s estate is transmitted or vested immediately from the moment of
the death of such causante or predecessor in interest (Civil Code of the Philippines, Art. 777) there is no legal
bar to a successor (with requisite contracting capacity) disposing of her or his hereditary share immediately
after such death, even if the actual extent of such share is not determined until the subsequent liquidation of
the estate.

Bonilla v. Barcena, 71 SCRA 491 | Angliongto

FACTS: On March 31, 1975 Fortunata Barcena, mother of minors Rosalio Bonilla and Salvacion Bonilla
and wife of Ponciano Bonilla, instituted a civil action in the CFI of Abra, to quiet title over certain parcels
of land located in Abra.

The defendants filed a motion to dismiss the complaint on the ground that Fortunata Barcena is dead
and, therefore, has no legal capacity to sue. In the hearing for the motion to dismiss, counsel for the
plaintiff confirmed the death of Fortunata Barcena, and asked for substitution by her minor children and
her husband; but the court after the hearing immediately dismissed the case on the ground that a dead
person cannot be a real party in interest and has no legal personality to sue.

ISSUE: W/N the CFI erred in dismissing the complaint.

HELD: While it is true that a person who is dead cannot sue in court, yet he can be substituted by his
heirs in pursuing the case up to its completion.

The records of this case show that the death of Fortunata Barcena took place on July 9, 1975 while the
complaint was filed on March 31, 1975. This means that when the complaint was filed on March 31,
1975, Fortunata Barcena was still alive, and therefore, the court had acquired jurisdiction over her
person.

Under Section 16, Rule 3 of the Rules of Court “whenever a party to a pending case dies … it shall be the
duty of his attorney to inform the court promptly of such death … and to give the name and residence of
his executor, administrator, guardian or other legal representatives.” This duty was complied with by the
counsel for the deceased plaintiff when he manifested before the respondent Court that Fortunata
Barcena died on July 9, 1975 and asked for the proper substitution of parties in the case.

The respondent Court, however, instead of allowing the substitution, dismissed the complaint on the
ground that a dead person has no legal personality to sue.
This is a grave error. Article 777 of the Civil Code provides “that the rights to the succession are
transmitted from the moment of the death of the decedent.”

From the moment of the death of the decedent, the heirs become the absolute owners of his property,
subject to the rights and obligations of the decedent, and they cannot be deprived of their rights thereto
except by the methods provided for by law. The moment of death is the determining factor when the
heirs acquire a definite right to the inheritance whether such right be pure or contingent. The right of
the heirs to the property of the deceased vests in them even before judicial declaration of their being
heirs in the testate or intestate proceedings.

When Fortunata Barcena, therefore, died, her claim or right to the parcels of land in litigation in Civil
Case No. 856, was not extinguished by her death but was transmitted to her heirs upon her death. Her
heirs have thus acquired interest in the properties in litigation and became parties in interest in the
case. There is, therefore, no reason for the respondent Court not to allow their substitution as parties in
interest for the deceased plaintiff.

The claim of the deceased plaintiff which is an action to quiet title over the parcels of land in litigation
affects primarily and principally property and property rights and therefore is one that survives even
after her death.

It is, therefore, the duty of the respondent Court to order the legal representative of the deceased
plaintiff to appear and to be substituted for her. But what the respondent Court did, upon being
informed by the counsel for the deceased plaintiff that the latter was dead, was to dismiss the
complaint.

This should not have been done for under Section 17, Rule 3 of the Rules of Court, it is even the duty of
the court, if the legal representative fails to appear, to order the opposing party to procure the
appointment of a legal representative of the deceased.

Unquestionably, the respondent Court has gravely abused its discretion in not complying with the clear
provision of the Rules of Court in dismissing the complaint of the plaintiff in Civil Case No. 856 and
refusing the substitution of parties in the case
G.R. No. L-46364 April 6, 1990

SULPICIA JIMENEZ and TORIBIO MATIAS, petitioners,

vs.

VICENTE FERNANDEZ alias HOSPICIO FERNANDEZ and TEODORA GRADO, respondents.

Antonio E. Bengzon III for petitioners.

Agustin U. Cruz for private respondents.

PARAS, J.:

Before Us is a petition for review on certiorari of the following Decision 1 and Resolution 2 of the
Honorable Court of Appeals: (1) Decision, dated March 1, 1977 in C.A.-G.R. No. 49178-R entitled
"Sulpicia Jimenez, et al., v. Vicente Fernandez, et al." affirming in toto the judgment of the Court of First
Instance of Pangasinan, Third Judicial District in Civil Case No. 14802-I between the same parties and (2)
Resolution dated June 3, 1977 denying plaintiffs-appellants' motion for reconsideration.

As gathered from the records, the factual background of this case is as follows:

The land in question is the Eastern portion with an area of Four Hundred Thirty Six (436) square meters
of that parcel of residential land situated in Barrio Dulig (now Magsaysay), Municipality of Labrador,
Pangasinan actually covered by Transfer Certificate of Title No. 82275 (Exhibit A) issued in the name of
Sulpicia Jimenez.

The entire parcel of land with an area of 2,932 square meters, formerly belonged to Fermin Jimenez.
Fermin Jimenez has two (2) sons named Fortunato and Carlos Jimenez. This Fortunato Jimenez who
predeceased his father has only one child, the petitioner Sulpicia Jimenez. After the death of Fermin
Jimenez, the entire parcel of land was registered under Act 496 in the name of Carlos Jimenez and
Sulpicia Jimenez (uncle and niece) in equal shares pro-indiviso. As a result of the registration case
Original Certificate of Title No. 50933 (Exhibit 8) was issued on February 28, 1933, in the names of Carlos
Jimenez and Sulpicia Jimenez, in equal shares pro-indiviso.
Carlos Jimenez died on July 9, 1936 and his illegitimate daughter, Melecia Cayabyab, also known as
Melecia Jimenez, took possession of the eastern portion of the property consisting of 436 square
meters.

On January 20, 1944, Melecia Jimenez sold said 436 square meter-portion of the property to Edilberto
Cagampan and defendant Teodora Grado executed a contract entitled "Exchange of Real Properties"
whereby the former transferred said 436 square meter-portion to the latter, who has been in
occupation since.

On August 29, 1969, plaintiff Sulpicia Jimenez executed an affidavit adjudicating unto herself the other
half of the property appertaining to Carlos Jimenez, upon manifestation that she is the only heir of her
deceased uncle. Consequently Transfer Certificate of Title No. 82275 was issued on October 1, 1969 in
petitioner's name alone over the entire 2,932 square meter property.

On April 1, 1970, Sulpicia Jimenez, joined by her husband, instituted the present action for the recovery
of the eastern portion of the property consisting of 436 square meters occupied by defendant Teodora
Grado and her son.

After trial on the merits, the lower court rendered judgment, the dispositive portion of which reads:

WHEREFORE, decision is hereby rendered dismissing the complaint and holding the defendant, Teodora
Grado, the absolute owner of the land in question; ordering the plaintiffs to pay to the defendant the
amount of P500.00 as damages, as attorney's fees, and to pay the costs of suit.

SO ORDERED. (Rollo, p. 20)

Petitioner appealed the above judgment to the respondent Court of Appeals and on March 1, 1977,
respondent Court of Appeals rendered a decision affirming the same in toto. Said decision was rendered
by a special division of five (5) justices, with the Hon. Lourdes San Diego, dissenting.

Petitioners within the reglementary period granted by the Honorable Court of Appeals, filed therewith a
motion for reconsideration. But said motion for reconsideration was denied by the Court of Appeals in
its resolution dated June 3, 1977.
In their appeal to the respondent Court of Appeals from the aforequoted decision of the trial court,
herein petitioner raised the following assignments of error to wit:

ASSIGNMENTS OF ERROR

THE LOWER COURT ERRED IN NOT DECLARING THAT MELECIA CAYABYAB, ALSO KNOWN AS MELECIA
JIMENEZ, IS NOT THE DAUGHTER OF CARLOS JIMENEZ.

II

THE LOWER COURT ERRED IN NOT DECLARING THAT MELECIA CAYABYAB, ALSO KNOWN AS MELECIA
JIMENEZ, HAS NO RIGHT TO SELL THE LAND IN QUESTION TO EDILBERTO CAGAMPAN.

III

THE LOWER COURT ERRED IN NOT DECLARING THAT EDILBERTO CAGAMPAN DID NOT BECOME THE
OWNER OF THE LAND IN QUESTION BY VIRTUE OF THE DEED OF SALE (EXH. "1") EXECUTED BY MELECIA
CAYABYAB, ALIAS MELECIA JIMENEZ, IN HIS FAVOR.

IV

THE LOWER COURT ERRED IN NOT DECLARING THAT TEODORA GRADO DID NOT BECOME THE OWNER
OF THE LAND IN QUESTION BY VIRTUE OF THE DEED OF EXCHANGE (EXH. "7") EXECUTED BY HER AND
EDILBERTO CAGAMPAN.

THE LOWER COURT ERRED IN NOT DECLARING THAT THE TITLE OF APPELLANT SULPICIA JIMENEZ OVER
THE LAND IN QUESTION CAN NOT BE DEFEATED BY THE ADVERSE OPEN AND NOTORIOUS POSSESSION
OF APPELLEE TEODORA GRADO.
VI

THE LOWER COURT ERRED IN DECLARING THAT THE APPELLEE TEODORA GRADO IS THE ABSOLUTE
OWNER OF THE LAND IN QUESTION IN THE LIGHT OF THE DECISION OF THE SUPREME COURT IN THE
CASE OF LOURDES ARCUINO, ET AL., V. RUFINA APARIS AND CASIANO PURAY, G.R. NO. L-23424,
PROMULGATED JANUARY 31, 1968, WHICH CASE IS NOT APPLICABLE TO THE CASE AT BAR.

VII

THE LOWER COURT ERRED IN DISMISSING THE COMPLAINT AND ORDERING THE APPELLANTS TO PAY
THE APPELLEES THE SUM OF P500.00 AS ATTORNEYS FEES PLUS THE COSTS.

From the foregoing, this petition for review was filed.

We find merit in the petition.

From the start the respondent court erred in not declaring that Melecia Jimenez Cayabyab also known
as Melecia Jimenez, is not the daughter of Carlos Jimenez and therefore, had no right over the property
in question. Respondents failed to present concrete evidence to prove that Melecia Cayabyab was really
the daughter of Carlos Jimenez. Nonetheless, assuming for the sake of argument that Melecia Cayabyab
was the illegitimate daughter of Carlos Jimenez there can be no question that Melecia Cayabyab had no
right to succeed to the estate of Carlos Jimenez and could not have validly acquired, nor legally
transferred to Edilberto Cagampan that portion of the property subject of this petition.

It is well-settled in this jurisdiction that the rights to the succession are transmitted from the moment of
the death of the decedent (Art. 777, Civil Code). Moreover, Art. 2263 of the Civil Code provides as
follows:

Rights to the inheritance of a person who died with or without a will, before the effectivity of this Code,
shall be governed by the Civil Code of 1889, by other previous laws, and by the Rules of Court . . . (Rollo,
p. 17)
Thus, since Carlos Jimenez, owner of one-half pro-indiviso portion of that parcel of land then covered by
Original Certificate of title No. 50933, died on July 9, 1936 (Exhibit "F") way before the effectivity of the
Civil Code of the Philippines, the successional rights pertaining to his estate must be determined in
accordance with the Civil Code of 1889.

Citing the case of Cid v. Burnaman (24 SCRA 434) wherein this Court categorically held that:

To be an heir under the rules of Civil Code of 1889 (which was the law in force when Carlos Jimenez died
and which should be the governing law in so far as the right to inherit from his estate was concerned), a
child must be either a child legitimate, legitimated, or adopted, or else an acknowledged natural child —
for illegitimate not natural are disqualified to inherit. (Civil Code of 1889, Art. 807, 935)

Even assuming that Melecia Cayabyab was born out of the common-law-relationship between her
mother (Maria Cayabyab) and Carlos Jimenez, she could not even be considered an acknowledged
natural child because Carlos Jimenez was then legally married to Susana Abalos and therefore not
qualified to marry Maria Cayabyab and consequently Melecia Cayabyab was an illegitimate spurious
child and not entitled to any successional rights in so far as the estate of Carlos Jimenez was concerned.

Melecia Cayabyab in the absence of any voluntary conveyance to her by Carlos Jimenez or Sulpicia
Jimenez of the litigated portion of the land could not even legally transfer the parcel of land to Edilberto
Cagampan who accordingly, could not also legally transfer the same to herein private respondents.

Analyzing the case before Us in this manner, We can immediately discern another error in the decision
of the respondent court, which is that the said court sustained and made applicable to the case at bar
the ruling in the case of Arcuino, et al., v. Aparis and Puray, No. L-23424, January 31, 1968, 22 SCRA 407,
wherein We held that:

. . . it is true that the lands registered under the Torrens System may not be acquired by prescription but
plaintiffs herein are not the registered owners. They merely claim to have acquired by succession, their
alleged title or interest in lot No. 355. At any rate plaintiffs herein are guilty of laches.

The respondent court relying on the Arcuino case, concluded that respondents had acquired the
property under litigation by prescription. We cannot agree with such conclusion, because there is one
very marked and important difference between the case at bar and that of the Arcuino case, and that is,
that since 1933 petitioner Sulpicia Jimenez was a title holder, the property then being registered in her
and her uncle Carlos Jimenez' name. In the Arcuino case, this Supreme Court held. "(I)t is true that lands
registered under the Torrens System may not be acquired by prescription but plaintiffs herein are not
the registered owners." (Rollo, p. 38) Even in the said cited case the principle of imprescriptibility of
Torrens Titles was respected.

Melecia Cayabyab's possession or of her predecessors-in-interest would be unavailing against the

petitioner Sulpicia Jimenez who was the holder pro-indiviso with Carlos Jimenez of the Torrens
Certificate of Title covering a tract of land which includes the portion now in question, from February 28,
1933, when the Original Certificate of Title No. 50933 (Exhibit 8) was issued.

No possession by any person of any portion of the land covered by said original certificate of titles, could
defeat the title of the registered owner of the land covered by the certificate of title. (Benin v. Tuason, L-
26127, June 28, 1974, 57 SCRA 531)

Sulpicia's title over her one-half undivided property remained good and continued to be good when she
segregated it into a new title (T.C.T No. 82275, Exhibit "A") in 1969. Sulpicia's ownership over her one-
half of the land and which is the land in dispute was always covered by a Torrens title, and therefore, no
amount of possession thereof by the respondents, could ever defeat her proprietary rights thereon. It is
apparent, that the right of plaintiff (now petitioner) to institute this action to recover possession of the
portion of the land in question based on the Torrens Title of Sulpicia Jimenez, T.C.T. No. 82275 (Exhibit
"A") is imprescriptible and not barred under the doctrine of laches. (J.M. Tuason & Co. v. Macalindong,
L-15398, December 29, 1962, Francisco v. Cruz, et al., 43 O.G. 5105) Rollo, p. 39)

The respondent Court of Appeals declared the petitioner Sulpicia Jimenez guilty of laches and citing the
ruling in the case of Heirs of Lacamen v. Heirs of Laruan (65 SCRA 605), held that, since petitioner
Sulpicia Jimenez executed her Affidavit of Self-Adjudication only in 1969, she lost the right to recover
possession of the parcel of land subject of the litigation.

In this instance, again We rule for the petitioner. There is no absolute rule as to what constitutes laches
or staleness of demand; each case is to be determined according to its particular circumstances. The
question of laches is addressed to the sound discretion of the court and since laches is an equitable
doctrine, its application is controlled by equitable considerations. It cannot be worked to defeat justice
or to perpetrate fraud and injustice. It would be rank injustice and patently inequitous to deprive the
lawful heirs of their rightful inheritance.

Petitioner Sulpicia Jimenez is entitled to the relief prayed for, declaring her to be the sole and absolute
owner of the land in question with right to its possession and enjoyment. Since her uncle Carlos Jimenez
died in 1936, his pro-indiviso share in the properties then owned in co-ownership with his niece Sulpicia
descended by intestacy to Sulpicia Jimenez alone because Carlos died without any issue or other heirs.
After all, the professed objective of Act No. 496, otherwise known as the Land Registration Act or the
law which established the Torrens System of Land Registration in the Philippines is that the stability of
the landholding system in the Philippines depends on the confidence of the people in the titles covering
the properties. And to this end, this Court has invariably upheld the indefeasibility of the Torrens Title
and in, among others, J.M. Tuason and Co., Inc. v. Macalindong (6 SCRA 938), held that "the right of the
appellee to file an action to recover possession based on its Torrens Title is imprescriptible and not
barred under the doctrine of laches.

WHEREFORE, the Petition for Review is hereby GRANTED. The Decision and Resolution dated March 1,
1977 and June 3, 1977 in CA G.R. No. L-49178-R are SET ASIDE.

SO ORDERED.

Vitug v. CA

G.R. No. 82027, March 29, 1990

Spouses Dolores and Romarico Vitug entered into a survivorship agreement with the Bank of American
National Trust and Savings Association. The said agreement contained the following stipulations:

(1) All money deposited and to be deposited with the Bank in their joint savings current account shall be
both their property and shall be payable to and collectible or withdrawable by either or any of them
during their lifetime; and

(2) After the death of one of them, the same shall belong to and be the sole property of the surviving
spouse and payable to and collectible or withdrawable by such survivor

Dolores died naming Rowena Corona in her wills as executrix. Romarico later filed a motion asking
authority to sell certain shares of stock and real property belonging to the estate to cover his advances
to the estate which he claimed were personal funds withdrawn from their savings account. Rowena
opposed on the ground that the same funds withdrawn from the savings account were conjugal
partnership properties and part of the estate. Hence, there should be no reimbursement. On the other
hand, Romarico insists that the same are his exclusive property acquired through the survivorship
agreement.

ISSUE: Whether or not the funds of the savings account subject of the survivorship agreement were
conjugal partnership properties and part of the estate

No. The Court ruled that a Survivorship Agreement is neither a donation mortis causa nor a donation
inter vivos. It is in the nature of an aleatory contract whereby one or both of the parties reciprocally
bind themselves to give or to do something in consideration of what the other shall give or do upon the
happening of an event which is to occur at an indeterminate time or is uncertain, such as death. The
Court further ruled that a survivorship agreement is per se not contrary to law and thus is valid unless its
operation or effect may be violative of a law such as in the following instances: (1) it is used as a mere
cloak to hide an inofficious donation; (2) it is used to transfer property in fraud of creditors; or (3) it is
used to defeat the legitime of a compulsory heir. In the instant case, none of the foregoing instances
were present. Consequently, the Court upheld the validity of the survivorship agreement entered into
by the spouses Vitug. As such, Romarico, being the surviving spouse, acquired a vested right over the
amounts under the savings account, which became his exclusive property upon the death of his wife
pursuant to the survivorship agreement. Thus, the funds of the savings account are not conjugal
partnership properties and not part of the estate of the deceased Dolores.

Vitug v. CA

183 SCRA 755

FACTS:

Romarico Vitug and Nenita Alonte were co-administrators of Dolores Vitug’s (deceased) estate. Rowena
Corona was the executrix. Romarico, the deceased’s husband, filed a motion with the probate court
asking for authority to sell certain shares of stock and real properties belonging to the estate to cover
alleged advances to the estate, which he claimed as personal funds. The advances were used to pay
estate taxes.

Corona opposed the motion on ground that the advances came from a savings account which formed
part of the conjugal partnership properties and is part of the estate. Thus, there was no ground for
reimbursement. Romarico claims that the funds are his exclusive property, having been acquired
through a survivorship agreement executed with his late wife and the bank.
The agreement stated that after the death of either one of the spouses, the savings account shall belong
to and be the sole property of the survivor, and shall be payable to and collectible or withdrawable by
such survivor.

The lower court upheld the validity of the agreement and granted the motion to sell. CA reversed stating
that the survivorship agreement constitutes a conveyance mortis causa which did not comply with the
formalities of a valid will. Assuming that it was a donation inter vivos, it is a prohibited donation
(donation between spouses).

ISSUE:

W/N the survivorship agreement was valid.

HELD:

YES. The conveyance is not mortis causa, which should be embodied in a will. A will is a personal,
solemn, revocable and free act by which a capacitated person disposes of his property and rights and
declares or complies with duties to take effect after his death. The bequest or devise must pertain to the
testator.

In this case, the savings account involved was in the nature of conjugal funds. Since it was not shown
that the funds belonged exclusively to one party, it is presumed to be conjugal.

It is also not a donation inter vivos because it was to take effect after the death of one party. It is also
not a donation between spouses because it involved no conveyance of a spouse’s own properties to the
other.

It was an error to include the savings account in the inventory of the deceased’s assets because it is the
separate property of Romarico.

Thus, Romarico had the right to claim reimbursement.

A will is a personal, solemn, revocable and free act by which a capacitated person disposes of his his
property and rights and declares or complies with duties to take effect after his death.

Survivorship agreements are permitted by the NCC. However, its operation or effect must not be
violative of the law (i.e. used as a cloak to hide an inofficious donation or to transfer property in fraud of
creditors or to defeat the legitime of a forced heir).

Show opinions

DIVISION

[ GR NO. 82027, Mar 29, 1990 ]

ROMARICO G. VITUG v. CA +

DECISION

262 Phil. 830

SARMIENTO, J.:

This case is a chapter in an earlier suit decided by this Court[1] involving the probate of the two wills of
the late Dolores Luchangco Vitug, who died in New York, U.S.A., on November 10, 1980, naming private
respondent Rowena Faustino-Corona executrix. In our said decision, we upheld the appointment of
Nenita AIonte as co-special administra-tor of Mrs. Vitug's estate with her (Mrs. Vitug's) widower,
petitioner Romarico G. Vitug, pending probate.

On January 13, 1985, Romarico G. Vitug filed a motion asking for authority from the probate court to sell
certain shares of stock and real properties belonging to the estate to cover allegedly his advances to the
estate in the sum or P667,731.66, plus interests, which he claimed were personal funds. As found by
the Court of Appeals,[2] the alleged advances consisted of P58,147.40 spent for the payment of estate
tax, P518,834.27 as deficiency estate tax, and P90,749.99 as "increment thereto."[3] According to Mr.
Vitug, he withdrew the sums of P518.834.27 and P90,749.99 from savings account No. 35342-038 of the
Bank of America, Makati, Metro Manila.
On April 12, 1985, Rowena Corona opposed the motion to sell on the ground that the same funds
withdrawn from savings account No. 35342-038 were conjugal partnership properties and part of the
estate, and hence, there was allegedly no ground for reimbursement. She also sought his ouster for
failure to include the sums in question for inventory and for "concealment of funds belonging to the
estate."[4]

Vitug insists that the said funds are his exclusive property having acquired the same through a
survivorship agreement executed with his late wife and the bank on June 19, 1970. The agreement
provides:

We hereby agree with each other and with the BANK OF AMERICAN NATIONAL TRUST AND SAVINGS
ASSOCIATION (hereinafter referred to as the BANK), that all money now or hereafter deposited by us or
any or either of us with the BANK in our joint savings current account shall be the property of all or both
of us and shall be payable to and collectible or withdrawable by either or any of us during our lifetime,
and after the death of either or any of us shall belong to and be the sole property of the survivor or
survivors, and shall be payable to and collectible or withdrawable by such survivor or survivors.

We further agree with each other and the BANK that the receipt or check of either, any or all of us
during our lifetime, or the receipt or check of the survivor or survivors, for any payment or withdrawal
made for our above mentioned account shall be valid and sufficient release and discharge of the BANK
for such payment or withdrawal.[5]

The trial court[6] upheld the validity of this agreement and granted "the motion to sell some of the
estate of Dolores L. Vitug, the proceeds of which shall be used to pay the personal funds of Romarico
Vitug in the total sum of P667,731.66 x x x."[7]

On the other hand, the Court of Appeals, in the petition for certiorari filed by the herein private
respondent, held that the above-quoted survivorship agreement constitutes a conveyance mortis causa
which "did not comply with the formalities of a valid will as prescribed by Article 805 of the Civil
Code,"[8] and secondly, assuming that it is a mere donation inter vivos, it is a prohibited donation under
the provisions of Article 133 of the Civil Code.[9]

The dispositive portion of the decision or the Court of Appeals states:

WHEREFORE, the order of respondent Judge dated November 26, 1985 (Annex II, petition) is hereby set
aside insofar as it granted private respondent's motion to sell certain properties of the estate of Dolores
L. Vitug for reimbursement of his alleged advances to the estate, but the same order is sustained in all
other respects. In addition, respondent Judge is directed to include provisionally the deposits in Savings
Account No. 35342-038 with the Bank of America, Makati, in the inventory of actual properties
possessed by the spouses at the time of the decedent's death. With costs against private
respondent.[10]

In his petition, Vitug, the surviving spouse, assails the appellate court's ruling on the strength of our
decisions in Rivera v. People's Bank and Trust Co.[11] and Macam v. Gatmaitan[12] in which we
sustained the validity of "survivorship agreements" and considering them as aleatory contracts.[13]

The petition is meritorious.

The conveyance in question is not, first or all, one of mortis causa, which should be embodied in a will.
A will has been defined as "a personal, solemn, revocable and free act by which a capacitated person
disposes of his property and rights and declares or complies with duties to take effect after his
death."[14] In other words, the bequest or device must pertain to the testator.[15] In this case, the
monies subject of savings account No. 35342-038 were in the nature of conjugal funds. In the case
relied on, Rivera v. People's Bank and Trust Co.,[16] we rejected claims that a survivorship agreement
purports to deliver one party's separate properties in favor of the other, but simply, their joint holdings:

xxx xxx xxx

xxx Such conclusion is evidently predicated on the assumption that Stephenson was the exclusive owner
of the funds deposited in the bank, which assumption was in turn based on the facts (1) that the account
was originally opened in the name of Stephenson alone and (2) that Ana River "served only as
housemaid of the deceased." But it not infrequently happens that a person deposits money in the bank
in the name of another; and in the instant case it also appears that Ana Rivera served her master for
about nineteen years without actually receiving her salary from him. The fact that subsequently
Stephenson transferred the account to the name of himself and/or Ana Rivera and executed with the
latter the survivorship agreement in question although there was no relation of kinship between them
but only that of master and servant, nullifies the assumption that Stephenson was the exclusive owner
of the bank account. In the absence, then, of clear proof to the contrary, we must give full faith and
credit to the certificate of deposit which recites in effect that the funds in question belonged to Edgar
Stephenson and Ana Rivera; that they were joint (and several) owners thereof; and that either of them
could withdraw any part or the whole of said account during the lifetime of both, and the balance, if
any, upon the death of either, belonged to the survivor.[17]

xxx xxx xxx

In Macam v. Gatmaitan,[18] it was held:

xxx xxx xxx

This Court is of the opinion that Exhibit C, is an aleatory contract whereby, according to article 1790 of
the Civil Code, one of the parties or both reciprocally bind themselves to give or do something as an
equivalent for that which the other party is to give or do in case of the occurrence of an event which is
uncertain or will happen at an indeterminate time. As already stated, Leonarda was the owner of the
house and Juana of the Buick automobile and most of the furniture. By virtue of Exhibit C, Juana would
become the owner of the house in case Leonarda died first, and Leonarda would become the owner of
the automobile and the furniture if Juana were to die first. In this manner Leonarda and Juana
reciprocally assigned their respective property to one another conditioned upon who might die first, the
time of death determining the event upon which the acquisition of such right by the one or the other
depended. This contract, as any other contract, is binding upon the parties thereto. Inasmuch as
Leonarda had died before Juana, the latter thereupon acquired the ownership of the house, in the same
manner as Leonarda would have acquired the ownership of the automobile and of the furniture if Juana
had died first.[19]

xxx xxx xxx

There is no showing that the funds exclusively belonged to one party, and hence it must be presumed to
be conjugal, having been acquired during the existence of the marital relations.[20]

Neither is the survivorship agreement a donation inter vivos, for obvious reasons, because it was to take
effect after the death of one party. Secondly, it is not a donation between the spouses because it
involved no conveyance of a spouse's own properties to the other.

It is also our opinion that the agreement involves no modification of the conjugal partnership, as held by
the Court of Appeals,[21] by "mere stipulation,"[22] and that it is no "cloak"[23] to circumvent the law
on conjugal property relations. Certainly, the spouses are not prohibited by law to invest conjugal
property, say, by way of a joint and several bank account, more commonly denominated in banking
parlance as an "and/or" account. In the case at bar, when the spouses Vitug opened savings account
No. 35342-038, they merely put what rightfully belonged to them in a money-making venture. They did
not dispose of it in favor of the other which would have arguably been sanctionable as a prohibited
donation. And since the funds were conjugal, it can not be said that one spouse could have pressured
the other in placing his or her deposits in the money pool.
The validity of the contract seems debatable by reason of its "survivor-take-all" feature, but in reality,
that contract imposed a mere obligation with a term, the term being death. Such agreements are
permitted by the Civil Code.[24]

Under Article 2010 of the Code:

ART. 2010. By an aleatory contract, one of the parties or both reciprocally bind themselves to give or to
do something in consideration of what the other shall give or do upon the happening of an event which
is uncertain, or which is to occur at an indeterminate time.

Under the aforequoted provision, the fulfillment of an aleatory contract depends on either the
happening of an event which is (1)"uncertain," or (2) "which is to occur at an indeterminate time." A
survivorship agreement, the sale of a sweepstake ticket, a transaction stipulating on the value of
currency, and insurance have been held to fall under the first category, while a contract for life annuity
or pension under Article 2021, et sequenta, has been categorized under the second.[25] In either case,
the element of risk is present. In the case at bar, the risk was the death of one party and survivorship of
the other.

However, as we have warned:

xxx xxx xxx

But although the survivorship agreement is per se not contrary to law its operation or effect may be
violative of the law. For instance, if it be shown in a given case that such agreement is a mere cloak to
hide an inofficious donation, to transfer property in fraud of creditors, or to defeat the legitime of a
forced heir, it may be assailed and annulled upon such grounds. No such vice has been imputed and
established against the agreement involved in this case.[26]

xxx xxx xxx

There is no demonstration here that the survivorship agreement had been executed for such unlawful
purposes, or as held by the respondent court, in order to frustrate our laws on wills, donations, and
conjugal partnership.

The conclusion is accordingly unavoidable that Mrs. Vitug having predeceased her husband, the latter
has acquired upon her death a vested right over the amounts under savings account No. 35342-038 of
the Bank of America. Insofar as the respondent court ordered their inclusion in the inventory of assets
left by Mrs. Vitug, we hold that the court was in error. Being the separate property of petitioner, it
forms no more part of the estate of the deceased.
WHEREFORE, the decision of the respondent appellate court, dated June 29, 1987, and its resolution,
dated February 9, 1988, are SET ASIDE.

No costs.

SO ORDERED.

Melencio-Herrera, (Chairman), Paras, Padilla, and Regalado, JJ., cocncur.

[1] Corona v. Court or Appeals, No. 59821, August 30, 1982, 116 SCRA 316.

[2] Kapunan, Santiago, M., J., ponente; Puno, Reynato S. and Marigomen, Alfredo, JJ., concurring.

[3] Rollo, 21.

[4] Id., 22.

[5] Id.

[6] Judge (now Justice of the Court of Appeals) Asaali S. lsnani, presiding.

[7] Rollo, 23.

[8] Id., 26.

[9] Now, Article 87 of the Family Code.

[10] Rollo, 28-29.

[11] 73 Phil. 546 (1942).

[12] 64 Phil. 187 (1937).

[13] CIVIL CODE, Art. 2010.

[14] III TOLENTINO, CIVIL CODE OF THE PHILIPPINES 26 (1973 ed.), citing 1 GOMEZ 53.

[15] See CIVIL CODE, supra., arts. 793, 794, 930.

[16] Supra.

[17] Supra., 547.

[18] Supra.

[19] Supra., 190-191.

[20] CIVIL CODE, supra, art. 160.

[21] In the words of the Appellate Court: "Since private respondent and his late wife did not enter into a
marriage settlement before marriage, their property relationship was that of conjugal partnership
governed by the Civil Code. The system of conjugal partnership prohibits, as already mentioned,
donation between the spouses during the marriage, except that which takes effect after the death of
the donor, in which case, the donation shall comply with the formalities of a will (Arts. 133, 728, 805).
To allow the prohibited donation by giving it a cloak of aleatory contract would sanction a (modification)
of a marriage settlement during marriage by a mere stipulation. As mandated by Art. 52, the nature,
consequences and incidents of marriage, which is not a mere contract but an inviolable social institution
are governed by law, and not subject to stipulation."

[22] id.
[23] Id.

[24] CIVIL CODE, supra., art. 1193.

[25] V. PARAS, CIVIL CODE OF THE PHILIPPINES, 782 (1986 ed.)

[26] Rivera, supra, 548.

Facts Issues Ruling Principles

Show opinions

[ GR No. L-28040, Aug 18, 1972 ]

TESTATE ESTATE OF JOSEFA TANGCO v. TASIANA VDA. DE DE BORJA +

DECISION

150-B Phil. 486

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

Of these cases, the first, numbered L-28040 is an appeal by Tasiana Ongsingco Vda. de de Borja, special
administratrix of the testate estate of Francisco de Borja[1] , from the approval of a compromise
agreement by the Court of First Instance of Rizal, Branch I, in its Special Proceeding No. R-7866, entitled,
"Testate Estate of Josefa Tangco, Jose de Borja, Administrator".

Case No. L-28568 is an appeal by administrator Jose de Borja from the disapproval of the same
compromise agreement by the Court of First Instance of Nueva Ecija, Branch II, in its Special Proceeding
No. 832, entitled, "Testate Estate of Francisco de Borja, Tasiana O. Vda. de de Borja, Special
Administratrix".
And Case No. L-28611 is an appeal by administrator Jose de Borja from the decision of the Court of First
Instance of Rizal, Branch X, in its Civil Case No. 7452, declaring the Hacienda Jalajala Poblacion, which is
the main object of the aforesaid compromise agreement, as the separate and exclusive property of the
late Francisco de Borja and not a conjugal asset of the community with his first wife, Josefa Tangco, and
that said hacienda pertains exclusively to his testate estate, which is under administration in Special
Proceeding No. 832 of the Court of First Instance of Nueva Ecija, Branch II.

It is uncontested that Francisco de Borja, upon the death of his wife Josefa Tangco, on 6 October 1940,
filed a petition for the probate of her will which was docketed as Special Proceeding No. R-7866 of the
Court of First Instance of Rizal, Branch I. The will was probated on 2 April 1941. In 1946, Francisco de
Borja was appointed executor and administrator; in 1952, their son, Jose de Borja, was appointed co-
administrator. When Francisco died, on 14 April 1954, Jose became the sole administrator of the testate
estate of his mother, Josefa Tangco. While a widower Francisco de Borja allegedly took unto himself a
second wife, Tasiana Ongsingco. Upon Francisco's death, Tasiana instituted testate proceedings in the
Court of First Instance of Nueva Ecija, where, in 1955, she was appointed special administratrix. The
validity of Tasiana's marriage to Francisco was questioned in said proceeding.

The relationship between the children of the first marriage and Tasiana Ongsingco has been plagued
with several court suits and counter-suits; including the three cases at bar, some eighteen (18) cases
remain pending determination in the courts. The testate estate of Josefa Tangco alone has been
unsettled for more than a quarter of a century. In order to put an end to all these litigations, a
compromise agreement was entered into on 12 October 1963[2] , by and between "[T]he heir and son
of Francisco de Borja by his first marriage, namely, Jose de Borja personally and as administrator of the
Testate Estate of Josefa Tangco," and "[T]he heir and surviving spouse of Francisco de Borja by his
second marriage, Tasiana Ongsingco Vda. de Borja, assisted by her lawyer, Atty. Luis Panaguiton, Jr." The
terms and conditions of the compromise agreement are as follows:

"AGREEMENT

THIS AGREEMENT made and entered into by and between

The heir and son of Francisco de Borja by his first marriage, namely, Jose de Borja personally and as
administrator of the Testate Estate of Josefa Tangco,

AND
The heir and surviving spouse of Francisco de Borja by his second marriage, Tasiana Ongsingco Vda. de
de Borja, assisted by her lawyer, Atty. Luis Panaguiton, Jr.

WITNESSETH

THAT it is the mutual desire of all the parties herein to terminate and settle, with finality, the various
court litigations, controversies, claims, counterclaims, etc., between them in connection with the
administration, settlement, partition, adjudication and distribution of the assets as well as liabilities of
the estates of Francisco de Borja and Josefa Tangco, first spouse of Francisco de Borja.

THAT with this end in view, the parties herein have agreed voluntarily and without any reservations to
enter into and execute this agreement under the following terms and conditions:

1. That the parties agree to sell the Poblacion portion of the Jalajala properties situated in Jalajala, Rizal,
presently under administration in the Testate Estate of Josefa Tangco (Sp. Proc. No. 7866, Rizal), more
specifically described as follows:

'Linda al Norte con el Rio Puwang que la separa de la jurisdiccion del Municipio de Pililla de la Provincia
de Rizal, y con el pico del Monte Zambrano; al Oeste con la Laguna de Bay; por el Sur con los herederos
de Marcelo de Borja; y por el Este con los terrenos de la Familia Maronilla'

with a segregated area of approximately 1,313 hectares at the amount of P0.30 per square meter.

2. That Jose de Borja agrees and obligates himself to pay Tasiana Ongsingco Vda. de de Borja the total
amount of Eight Hundred Thousand Pesos (P800,000) Philippine Currency, in cash, which represents
P200,000 as his share in the payment and P600,000 as pro-rata shares of the heirs Crisanto, Cayetano,
and Matilde, all surnamed de Borja and this shall be considered as full and complete payment and
settlement of her hereditary share in the estate of the late Francisco de Borja as well as the estate of
Josefa Tangco, Sp. Proc. No. 832 - Nueva Ecija and Sp. Proc. No. 7866 - Rizal, respectively, and to any
properties bequeathed or devised in her favor by the late Francisco de Borja by Last Will and Testament
or by Donation Inter Vivos or Mortis Causa or purportedly conveyed to her for consideration or
otherwise. The funds for this payment shall be taken from and shall depend upon the receipt of full
payment of the proceeds of the sale of Jalajala, Poblacion.'

3. That Tasiana Ongsingcd Vda. de de Borja hereby assumes payment of that particular obligation
incurred by the late Francisco de Borja in favor of the Rehabilitation Finance Corporation, now
Development Bank of the Philippines, amounting to approximately P30,000.00 and also assumes
payment of her 1/5 share of the Estate and Inheritance taxes on the Estate of the late Francisco de Borja
or the sum of P3,500.00, more of less, which shall be deducted by the buyer of Jalajala 'Poblacion' from
the payment to be made to Tasiana Ongsingco Vda. de de Borja under paragraph 2 of this Agreement
and paid directly to the Development Bank of the Philippines and the heirs-children of Francisco de
Borja.

4. Thereafter, the buyer of Jalajala 'Poblacion' is hereby authorized to pay directly Tasiana Ongsingco
Vda. de de Borja the balance of the payment due her under paragraph 2 of this Agreement
(approximately P766,500.00) and issue in the name of Tasiana Ongsingco Vda. de de Borja,
corresponding certified checks/treasury warrants, who, in turn, will issue the corresponding receipt to
Jose de Borja.

5. In consideration of above payment to Tasiana Ongsingco Vda. de de Borja, Jose de Borja personally
and as administrator of the Testate Estate of Josefa Tangco, and Tasiana Ongsingco Vda. de de Borja, for
themselves and for their heirs, successors, executors, administrators, and assigns, hereby forever
mutually renounce, withdraw, waive, remise, release and discharge any and all manner of action or
actions, cause or causes of action, suits, debts, sum or sums of money, accounts, damages, claims and
demands whatsoever, in law or in equity, which they ever had, or now have or may have against each
other, more specifically Sp. Proceedings Nos. 7866 and 1955, CFI-Rizal, and Sp. Proc. No. 832 - Nueva
Ecija, Civil Case No. 3033, CFI-Nueva Ecija and Civil Case No. 7452-CFI, Rizal, as well as the case filed
against Manuel Quijal for perjury with the Provincial Fiscal of Rizal, the intention being to completely,
absolutely and finally release each other, their heirs, successors, and assigns, from any and all liability,
arising wholly or partially, directly or indirectly, from the administration, settlement, and distribution of
the assets as well as liabilities of the estates of Francisco de Borja and Josefa Tangco, first spouse of
Francisco de Borja, and lastly, Tasiana Ongsingco Vda. de de Borja expressly and specifically renounce
absolutely her rights as heir over any hereditary share in the estate of Francisco de Borja.

6. That Tasiana Ongsingco Vda. de de Borja, upon receipt of the payment under paragraph 4 hereof,
shall deliver to the heir Jose de Borja all the papers, titles and documents belonging to Francisco de
Borja which are in her possession and said heir Jose de Borja shall issue in turn the corresponding
receipt thereof.

7. That this agreement shall take effect only upon the fulfillment of the sale of the properties
mentioned under paragraph 1 of this agreement and upon receipt of the total and full payment of the
proceeds of the sale of the Jalajala property 'Poblacion', otherwise, the non-fulfillment of the said sale
will render this instrument NULL AND VOID AND WITHOUT EFFECT THEREAFTER.

IN WITNESS WHEREOF, the parties hereto have hereunto set their hands in the City of Manila,
Philippines, this 12th day of October, 1963."

On 16 May 1966, Jose de Borja submitted for Court approval the agreement of 12 October 1963 to the
Court of First Instance of Rizal, in Special Proceeding No. R-7866; and again, on 8 August 1966, to the
Court of First Instance of Nueva Ecija, in Special Proceeding No. 832. Tasiana Ongsingco Vda. de de
Borja opposed in both instances. The Rizal court approved the compromise agreement, but the Nueva
Ecija court declared it void and unenforceable. Special administratrix Tasiana Ongsingco Vda. de de
Borja appealed the Rizal Court's order of approval (now Supreme Court G. R. case No. L-28040), while
administrator Jose de Borja appealed the order of disapproval (G. R. case No. L-28568) by the Court of
First Instance of Nueva Ecija.

The genuineness and due execution of the compromise agreement of 12 October 1963 is not disputed,
but its validity is, nevertheless, attacked by Tasiana Ongsingco on the ground that: (1) the heirs cannot
enter into such kind of agreement without first probating the will of Francisco de Borja; (2) that the
same involves a compromise on the validity of the marriage between Francisco de Borja and Tasiana
Ongsingco; and (3) that even if it were valid, it has ceased to have force and effect.

In assailing the validity of the agreement of 12 October 1963, Tasiana Ongsingco and the Probate Court
of Nueva Ecija rely on this Court's decision in Guevara vs. Guevara, 74 Phil. 479, wherein the Court's
majority held the view that the presentation of a will for probate is mandatory and that the settlement
and distribution of an estate on the basis of intestacy when the decedent left a will, is against the law
and public policy. It is likewise pointed out by appellant Tasiana Ongsingco that Section 1 of Rule 74 of
the Revised Rules explicitly conditions the validity of an extrajudicial settlement of a decedent's estate
by agreement between heirs, upon the facts that "(if) the decedent left no will and no debts, and the
heirs are all of age, or the minors are represented by their judicial and legal representatives * * *." The
will of Francisco de Borja having been submitted to the Nueva Ecija Court and still pending probate
when the 1963 agreement was made, those circumstances, it is argued, bar the validity of the
agreement.

Upon the other hand, in claiming the validity of the compromise agreement, Jose de Borja stresses that
at the time it was entered into, on 12 October 1963, the governing provision was Section 1, Rule 74 of
the original Rules of Court of 1940, which allowed the extrajudicial settlement of the estate of a
deceased person regardless of whether he left a will or not. He also relies on the dissenting opinion of
Justice Moran, in Guevarra vs. Guevarra, 74 Phil. 479, wherein was expressed the view that if the parties
have already divided the estate in accordance with a decedent's will, the probate of the will is a useless
ceremony; and if they have divided the estate in a different manner, the probate of the will is worse
than useless.

The doctrine of Guevara vs. Guevara, ante, is not applicable to the case at bar. This is apparent from an
examination of the terms of the agreement between Jose de Borja and Tasiana Ongsingco. Paragraph 2
of said agreement specifically stipulates that the sum of P800,000 payable to Tasiana Ongsingco -

"shall be considered as full - complete payment - settlement of her hereditary share in the estate of the
late Francisco de Borja as well as the estate of Josefa Tangco, * * * and to any properties bequeathed or
devised in her favor by the late Francisco de Borja by Last Will and Testament or by Donation Inter Vivos
or Mortis Causa or purportedly conveyed to her for consideration or otherwise."
This provision evidences beyond doubt that the ruling in the Guevara case is not applicable to the cases
at bar. There was here no attempt to settle or distribute the estate of Francisco de Borja among the
heirs thereto before the probate of his will. The clear object of the contract was merely the conveyance
by Tasiana Ongsingco of any and all her individual share and interest, actual or eventual, in the estates
of Francisco de Borja and Josefa Tangco. There is no stipulation as to any other claimant, creditor or
legatee. And as a hereditary share in a decedent's estate is transmitted or vested immediately from the
moment of the death of such causante or predecessor in interest (Civil Code of the Philippines, Art.
777)[3] there is no legal bar to a successor (with requisite contracting capacity) disposing of her or his
hereditary share immediately after such death, even if the actual extent of such share is not determined
until the subsequent liquidation of the estate[4] . Of course, the effect of such alienation is to be
deemed limited to what is ultimately adjudicated to the vendor heir. However, the aleatory character of
the contract does not affect the validity of the transaction; neither does the coetaneous agreement that
the numerous litigations between the parties (the approving order of the Rizal Court enumerates
fourteen of them, Rec. App. pp. 79-82) are to be considered settled and should be dismissed, although
such stipulation, as noted by the Rizal Court, gives the contract the character of a compromise that the
law favors, for obvious reasons, if only because it serves to avoid a multiplicity of suits.

It is likewise worthy of note in this connection that as the surviving spouse of Francisco de Borja, Tasiana
Ongsingco was his compulsory heir under articles 995 et seq. of the present Civil Code. Wherefore,
barring unworthiness or valid disinheritance, her successional interest existed independent of Francisco
de Borja's last will and testament, and would exist even if such will were not probated at all. Thus, the
prerequisite of a previous probate of the will, as established in the Guevara and analogous cases, can
not apply to the case of Tasiana Ongsingco Vda. de de Borja.

Since the compromise contract Annex A was entered into by and between "Jose de Borja personally and
as administrator of the Testate Estate of Josefa Tangco" on the one hand, and on the other, "the heir
and surviving spouse of Francisco de Borja by his second marriage, Tasiana Ongsingco Vda. de de Borja",
it is clear that the transaction was binding on both in their individual capacities, upon the perfection of
the contract, even without previous authority of the Court to enter into the same. The only difference
between an extrajudicial compromise and one that is submitted and approved by the Court, is that the
latter can be enforced by execution proceedings. Art. 2037 of the Civil Code is explicit on the point:

Art. 2037. A compromise has upon the parties the effect and authority of res judicata; but there shall be
no execution except in compliance with a judicial compromise.

It is argued by Tasiana Ongsingco that while the agreement Annex A expressed no definite period for its
performance, the same was intended to have a resolutory period of 60 days for its effectiveness. In
support of such contention, it is averred that such a limit was expressly stipulated in an agreement in
similar terms entered into by said Ongsingco with the brothers and sister of Jose de Borja, to wit,
Crisanto, Matilde and Cayetano, all surnamed de Borja, except that the considerations was fixed at
P600,000 (Opposition, Annex 1 Rec. of Appeal, L-28040, pp. 39-46) and which contained the following
clause:

"III. That this agreement shall take effect only upon the consummation of the sale of the property
mentioned herein and upon receipt of the total and full payment of the proceeds of the sale by the
herein owner heirs-children of Francisco de Borja, namely, Crisanto, Cayetano and Matilde, all surnamed
de Borja; Provided that if no sale of the said property mentioned herein is consummated, or the non-
receipt of the purchase price thereof by the said owners within the period of sixty (60) days from the
date hereof, this agreement will become null and void and of no further effect."

Ongsingco's argument loses validity when it is considered that Jose de Borja was not a party to this
particular contract (Annex 1), and that the same appears not to have been finalized, since it bears no
date, the day being left blank "this - day of October 1963"; and while signed by the parties, it was not
notarized, although plainly intended to be so done, since it carries a proposed notarial ratification
clause. Furthermore, the compromise contract with Jose de Borja (Annex A), provides in its par. 2
heretofore transcribed that of the total consideration of P800,000 to be paid to Ongsingco, P600,000
represent the "pro rata share of the heirs Crisanto, Cayetano and Matilde, all surnamed de Borja" which
corresponds to the consideration of P600,000 recited in Annex 1, and that circumstance is proof that the
duly notarized contract entered into with Jose de Borja under date 12 October 1963 (Annex A), was
designed to absorb and supersede the separate unformalized agreement with the other three Borja
heirs. Hence, the 60 days resolutory term in the contract with the latter (Annex 1) not being repeated in
Annex A, can not apply to the formal compromise with Jose de Borja. It is moreover manifest that the
stipulation that the sale of the Hacienda de Jalajala was to be made within sixty days from the date of
the agreement with Jose de Borja's co-heirs (Annex 1) was plainly omitted in Annex A as improper and
ineffective since the Hacienda de Jalajala (Poblacion) that was to be sold to raise the P800,000 to be
paid to Ongsingco for her share formed part of the estate of Francisco de Borja and could not be sold
until authorized by the Probate Court. The Court of First Instance of Rizal so understood it, and in
approving the compromise it fixed a term of 120 days counted from the finality of the order now under
appeal, for the carrying out by the parties of the terms of the contract.

This brings us to the plea that the Court of First Instance of Rizal had no jurisdiction to approve the
compromise with Jose de Borja (Annex A) because Tasiana Ongsingco was not an heir in the estate of
Josefa Tangco pending settlement in the Rizal Court, but she was an heir of Francisco de Borja, whose
estate was the object of Special Proceeding No. 832 of the Court of First Instance of Nueva Ecija. This
circumstance is irrelevant, since what was sold by Tasiana Ongsingco was only her eventual share in the
estate of her late husband, not the estate itself; and as already shown, that eventual share she owned
from the time of Francisco's death and the Court of Nueva Ecija could not bar her selling it. As owner of
her undivided hereditary share, Tasiana could dispose of it in favor of whomsoever she chose. Such
alienation is expressly recognized and provided for by article 1088 of the present Civil Code:
"Art. 1088. Should any of the heirs sell his hereditary rights to a stranger before the partition, any or all
of the co-heirs may be subrogated to the rights of the purchaser by reimbursing him for the price of the
sale, provided they do so within the period of one month from the time they were notified in writing of
the sale by the vendor."

If a sale of a hereditary right can be made to a stranger, then a fortiori sale thereof to a coheir could not
be forbidden.

Tasiana Ongsingco further argues that her contract with Jose de Borja (Annex "A") is void because it
amounts to a compromise as to her status and marriage with the late Francisco de Borja. The point is
without merit, for the very opening paragraph of the agreement with Jose de Borja (Annex "A")
describes her as "the heir and surviving spouse of Francisco de Borja by his second marriage, Tasiana
Ongsingco Vda. de de Borja", which is in itself definite admission of her civil status. There is nothing in
the text of the agreement that would show that this recognition of Ongsingco's status as the surviving
spouse of Francisco de Borja was only made in consideration of the cession of her hereditary rights.

It is finally charged by appellant Ongsingco, as well as by the Court of First Instance of Nueva Ecija in its
order of 21 September 1964, in Special Proceedings No. 832 (Amended Record on Appeal in L-28568,
page 157), that the compromise agreement of 13 October 1963 (Annex "A") had been abandoned, as
shown by the fact that, after its execution, the Court of First Instance of Nueva Ecija, in its order of 21
September 1964, had declared that "no amicable settlement had been arrived at by the parties", and
that Jose de Borja himself, in a motion of 17 June 1964, had stated that the proposed amicable
settlement "had failed to materialize".

It is difficult to believe, however, that the amicable settlement referred to in the order and motion
above-mentioned was the compromise agreement of 13 October 1963, which already had been formally
signed and executed by the parties and duly notarized. What the record discloses is that some time
after its formalization, Ongsingco had unilaterally attempted to back out from the compromise
agreement, pleading various reasons restated in the opposition to the Court's approval of Annex "A"
(Record on Appeal, L-20840, page 23): that the same was invalid because of the lapse of the allegedly
intended resolutory period of 60 days and because the contract was not preceded by the probate of
Francisco de Borja's will, as required by this Court's Guevara vs. Guevara ruling; that Annex "A" involved
a compromise affecting Ongsingco's status as wife and widow of Francisco de Borja, etc., all of which
objections have been already discussed. It was natural that in view of the widow's attitude, Jose de
Borja should attempt to reach a new settlement or novatory agreement before seeking judicial sanction
and enforcement of Annex "A", since the latter step might ultimately entail a longer delay in attaining
final remedy. That the attempt to reach another settlement failed is apparent from the letter of
Ongsingco's counsel to Jose de Borja quoted in pages 35-36 of the brief for appellant Ongsingco in G. R.
No. L-28040; and it is more than probable that the order of 21 September 1964 and the motion of 17
June 1964 referred to the failure of the parties' quest for a more satisfactory compromise. But the
inability to reach a novatory accord can not invalidate the original compromise (Annex "A") and justifies
the act of Jose de Borja in finally seeking a court order for its approval and enforcement from the Court
of First Instance of Rizal, which, as heretofore described, decreed that the agreement be ultimately
performed within 120 days from the finality of the order, now under appeal.

We conclude that in so doing, the Rizal court acted in accordance with law, and, therefore, its order
should be upheld, while the contrary resolution of the Court of First Instance of Nueva Ecija should be,
and is, reversed.

In her brief, Tasiana Ongsingco also pleads that the time elapsed in the appeal has affected her
unfavorably, in that while the purchasing power of the agreed price of P800,000 has diminished, the
value of the Jalajala property has increased. But the fact is that her delay in receiving the payment of
the agreed price for her hereditary interest was primarily due to her attempts to nullify the agreement
(Annex "A") she had formally entered into with the advice of her counsel, Attorney Panaguiton. And as
to the devaluation de facto of our currency, what We said in Dizon Rivera vs. Dizon, L-24561, 30 June
1970, 33 SCRA, 554, that "estates would never be settled if there were to be a revaluation with every
subsequent fluctuation in the values of currency and properties of the estate", is particularly apposite in
the present case.

Coming now to Case G. R. No. L-28611, the issue is whether the Hacienda de Jalajala (Poblacion),
concededly acquired by Francisco de Borja during his marriage to his first wife, Josefa Tangco, is the
husband's private property (as contended by his second spouse, Tasiana Ongsingco), or whether it forms
part of the conjugal (ganancial) partnership with Josefa Tangco. The Court of First Instance of Rizal
(Judge Herminio Mariano, presiding) declared that there was adequate evidence to overcome the
presumption in favor of its conjugal character established by Article 160 of the Civil Code.

We are of the opinion that this question as between Tasiana Ongsingco and Jose de Borja has become
moot and academic, in view of the conclusion reached by this Court in the two preceding cases (G. R.
No. L-28568), upholding as valid the cession of Tasiana Ongsinco's eventual share in the estate of her
late husband, Francisco de Borja, for the sum of P800,000 with the accompanying reciprocal quitclaims
between the parties. But as the question may affect the rights of possible creditors and legatees, its
resolution is still imperative.

It is undisputed that the Hacienda Jalajala, of around 4,363 hectares, had been originally acquired jointly
by Francisco de Borja, Bernardo de Borja and Marcelo de Borja, and their title thereto was duly
registered in their names as co-owners in Land Registration Case No. 528 of the province of Rizal,
G.L.R.O. Rec. No. 26403 (De Borja vs. Jugo, 54 Phil. 465). Subsequently, in 1931, the Hacienda was
partitioned among the co-owners: the Punta section went to Marcelo de Borja; the Bagombong section
to Bernardo de Borja, and the part in Jalajala proper (Poblacion) corresponded to Francisco de Borja (V.
De Borja vs. De Borja, 101 Phil. 911, 932).
The lot allotted to Francisco was described as -

"Una Parcela de terreno situada en Poblacion, Jalajala: N. Puang River; E. Hermogena Romero; S. Heirs
of Marcelo de Borja, O. Laguna de Bay; containing an area of 13,488,870 sq. m. more or less, assessed at
P297,410." (Record on Appeal, pages 7 and 105)

On 20 November 1962, Tasiana O. Vda. de Borja, as Administratrix of the Testate Estate of Francisco de
Borja, instituted a complaint in the Court of First Instance of Rizal (Civil Case No. 7452) against Jose de
Borja, in his capacity as Administrator of Josefa Tangco (Francisco de Borja's first wife), seeking to have
the Hacienda above described declared exclusive private property of Francisco, while in his answer
defendant (now appellant) Jose de Borja claimed that it was conjugal property of his parents (Francisco
de Borja and Josefa Tangco), conformably to the presumption established by Article 160 of the
Philippine Civil Code (reproducing Article 1407 of the Civil Code of 1889), to the effect that:

"Art. 160. All property of the marriage is presumed to belong to the conjugal partnership, unless it be
proved that it pertains exclusively to the husband or to the wife."

Defendant Jose de Borja further counterclaimed for damages, compensatory, moral and exemplary, as
well as for attorney's fees.

After trial, the Court of First Instance of Rizal, per Judge Herminio Mariano, held that the plaintiff had
adduced sufficient evidence to rebut the presumption, and declared the Hacienda de Jalajala (Poblacion)
to be the exclusive private property of the late Francisco de Borja, and his Administratrix, Tasiana
Ongsingco Vda. de Borja, to be entitled to its possession. Defendant Jose de Borja then appealed to this
Court.

The evidence reveals, and the appealed order admits, that the character of the Hacienda in question as
owned by the conjugal partnership de Borja-Tangco was solemnly admitted by the late Francisco de
Borja no less than two times: first, in the Reamended Inventory that, as executor of the estate of his
deceased wife Josefa Tangco, he filed in the Special Proceedings No. 7866 of the Court of First Instance
of Rizal on 23 July 1953 (Exhibit "2"); and again, in the Reamended Accounting of the same date, also
filed in the proceedings aforesaid (Exhibit "7"). Similarly, the plaintiff Tasiana O. Vda. de Borja, herself,
as oppositor in the Estate of Josefa Tangco, submitted therein an inventory dated 7 September 1954
(Exhibit "3") listing the Jalajala property among the "Conjugal Properties of the Spouses Francisco de
Borja and Josefa Tangco". And once more, Tasiana Ongsingco, as administratrix of the Estate of
Francisco de Borja, in Special Proceedings No. 832 of the Court of First Instance of Nueva Ecija,
submitted therein in December, 1955 an inventory wherein she listed the Jalajala Hacienda under the
heading "Conjugal Property of the Deceased Spouses Francisco de Borja and Josefa Tangco, which are in
the possession of the Administrator of the Testate Estate of the Deceased Josefa Tangco in Special
Proceedings No. 7866 of the Court of First Instance of Rizal" (Exhibit "4").

Notwithstanding the four statements aforesaid, and the fact that they are plain admissions against
interest made by both Francisco de Borja and the Administratrix of his estate, in the course of judicial
proceedings in the Rizal and Nueva Ecija Courts, supporting the legal presumption in favor of the
conjugal community, the Court below declared that the Hacienda de Jalajala (Poblacion) was not
conjugal property, but the private exclusive property of the late Francisco de Borja. It did so on the
strength of the following evidences: (a) the sworn statement by Francisco de Borja on 6 August 1951
(Exhibit "F") that -

"He tomado posesion del pedazo de terreno ya delimitado (equivalente a 1/4 parte, 337 hectareas)
adjunto a mi terreno personal y exclusivo (Poblacion de Jalajala, Rizal)."

and (b) the testimony of Gregorio de Borja, son of Bernardo de Borja, that the entire Hacienda had been
bought at a foreclosure sale for P40,100.00, of which amount P25,100 was contributed by Bernardo de
Borja and P15,000.00 by Marcelo de Borja; that upon receipt of a subsequent demand from the
provincial treasurer for realty taxes in the sum of P17,000, Marcelo told his brother Bernardo that
Francisco (son of Marcelo) wanted also to be a co-owner, and upon Bernardo's assent to the proposal,
Marcelo issued a check for P17,000.00 to pay the back taxes and said that the amount would represent
Francisco's contribution in the purchase of the Hacienda. The witness further testified that -

"Marcelo de Borja said that that money was entrusted to him by Francisco de Borja when he was still a
bachelor and which he derived from his business transactions." (Hearing, 2 February 1965, t.s.n., pages
13-15) (Italics supplied)

The Court below, reasoning that not only Francisco's sworn statement overweighed the admissions in
the inventories relied upon by defendant-appellant Jose de Borja, since probate courts can not finally
determine questions of ownership of inventoried property, but that the testimony of Gregorio de Borja
showed that Francisco de Borja acquired his share of the original Hacienda with his own private funds,
for which reason that share can not be regarded as conjugal partnership property, but as exclusive
property of the buyer, pursuant to Article 1396(4) of the Civil Code of 1889 and Article 148(4) of the Civil
Code of the Philippines.

The following shall be the exclusive property of each spouse:

*** *** ***

"(4) That which is purchased with exclusive money of the wife or of the husband."
We find the conclusions of the lower court to be untenable. In the first place, witness Gregorio de
Borja's testimony as to the source of the money paid by Francisco for his share was plain hearsay, hence
inadmissible and of no probative value, since he was merely repeating what Marcelo de Borja had told
him (Gregorio). There is no way of ascertaining the truth of the statement, since both Marcelo and
Francisco de Borja were already dead when Gregorio testified. In addition, the statement itself is
improbable, since there was no need or occasion for Marcelo de Borja to explain to Gregorio how and
when Francisco de Borja had earned the P17,000.00 entrusted to Marcelo. A ring of artificiality is clearly
discernible in this portion of Gregorio's testimony.

As to Francisco de Borja's affidavit, Exhibit "F", the quoted portion thereof (ante, page 373) does not
clearly demonstrate that the "mi terreno personal y exclusivo (Poblacion de Jalajala, Rizal)" refers
precisely to the Hacienda in question. The inventories (Exhibits 3 and 4) disclose that there were two
real properties in Jalajala owned by Francisco de Borja, one of 72.038 sq. m., assessed at P44,600, and a
much bigger one of 1,357,260.70 sq. m., which is evidently the Hacienda de Jalajala (Poblacion). To
which of these lands did the affidavit of Francisco de Borja (Exhibit "F") refer to? In addition, Francisco's
characterization of the land as "mi terreno personal y exclusivo" is plainly self-serving, and not
admissible in the absence of cross examination.

It may be true that the inventories relied upon by defendant-appellant (Exhibits "2", "3", "4" and "7")
are not conclusive on the conjugal character of the property in question; but as already noted, they are
clear admissions against the pecuniary interest of the declarants, Francisco de Borja and his executor-
widow, Tasiana Ongsingco, and as such of much greater probative weight than the self-serving
statement of Francisco (Exhibit "F"). Plainly, the legal presumption in favor of the conjugal character of
the Hacienda de Jalajala (Poblacion) now in dispute has not been rebutted - but actually confirmed by
proof. Hence, the appealed order should be reversed and the Hacienda de Jalajala (Poblacion) declared
property of the conjugal partnership of Francisco de Borja and Josefa Tangco.

No error having been assigned against the ruling of the lower court that claims for damages should be
ventilated in the corresponding special proceedings for the settlement of the estates of the deceased,
the same requires no pronouncement from this Court.

IN VIEW OF THE FOREGOING , the appealed order of the Court of First Instance of Rizal in Case No. L-
28040 is hereby affirmed; while those involved in Cases Nos. L-28568 and L-28611 are reversed and set
aside. Costs against the appellant Tasiana Ongsingco Vda. de Borja in all three (3) cases.

Concepcion, C.J., Makalintal, Zaldivar, Castro, Teehankee, Barredo, Makasiar, Antonio, and Esguerra, JJ.,
concur.
Fernando, J., did not take part.

[1] She died during the pendency of these appeals, being substituted by Atty. Luis Panaguiton, Jr.,
administrator of her estate (S. C. Resolution, 27 February 1970).

[2] Annex A, Record of Appeal, G. R. No. L-28040, pp. 16-21.

[3] Also; Osorio vs. Osorio Steamship Co. 41 Phil. 531; Baun vs. Heirs of Baun 53 Phil. 654; Barretto vs.
Tuason, 59 Phil. 845; Cuevas vs. Abesamis, 71 Phil. 147; Jayme vs. Gamboa, 75 Phil. 479; Iballe vs. Po 49
O.G. 956.

[4] Garcia vs. David, 67 Phil. 279; Jakosalem vs. Rafols, 73 Phil. 628.

Facts Issues Ruling Principles

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DIVISION

[ GR No. L-41715, Jun 18, 1976 ]

ROSALIO BONILLA WHO REPRESENTS MINORS v. LEON BARCENA +

DECISION

163 Phil. 516

MARTIN, J.:
This is a petition for review[1] of the Order of the Court of First Instance of Abra in Civil Case No. 856,
entitled Fortunata Barcena vs. Leon Barcena, et al., denying the motions for reconsideration of its order
dismissing the complaint in the aforementioned case.

On March 31, 1975 Fortunata Barcena, mother of minors Rosalio Bonilla and Salvacion Bonilla and wife
of Ponciano Bonilla, instituted a civil action in the Court of First Instance of Abra, to quiet title over
certain parcels of land located in Abra.

On May 9, 1975, defendants filed a written motion to dismiss the complaint, but before the hearing of
the motion to dismiss, the counsel for the plaintiff moved to amend the complaint in order to include
certain allegations therein. The motion to amend the complaint was granted and on July 17, 1975,
plaintiffs filed their amended complaint.

On August 4, 1975, the defendants filed another motion to dismiss the complaint on the ground that
Fortunata Barcena is dead and, therefore, has no legal capacity to sue. Said motion to dismiss was heard
on August 14, 1975. In said hearing, counsel for the plaintiff confirmed the death of Fortunata Barcena
and asked for substitution by her minor children and her husband, the petitioners herein; but the court
after the hearing immediately dismissed the case on the ground that a dead person cannot be a real
party in interest and has no legal personality to sue.

On August 19, 1975, counsel for the plaintiff received a copy of the order dismissing the complaint and
on August 23, 1975, he moved to set aside the order of the dismissal pursuant to Sections 16 and 17 of
Rule 3 of the Rules of Court.[2]

On August 28, 1975, the court denied the motion for reconsideration filed by counsel for the plaintiff for
lack of merit. On September 1, 1975, counsel for deceased plaintiff filed a written manifestation praying
that the minors Rosalio Bonilla and Salvacion Bonilla be allowed to substitute their deceased mother,
but the court denied the counsel's prayer for lack of merit. From the order, counsel for the deceased
plaintiff filed a second motion for reconsideration of the order dismissing the complaint claiming that
the same is in violation of Sections 16 and 17 of Rule 3 of the Rules of Court but the same was denied.

Hence, this petition for review.

The Court reverses the respondent Court and sets aside its order dismissing the complaint in Civil Case
No. 856 and its orders denying the motion for reconsideration of said order of dismissal. While it is true
that a person who is dead cannot sue in court, yet he can be substituted by his heirs in pursuing the case
up to its completion. The records of this case show that the death of Fortunata Barcena took place on
July 9, 1975 while the complaint was filed on March 31, 1975. This means that when the complaint was
filed on March 31, 1975, Fortunata Barcena was still alive, and therefore, the court had acquired
jurisdiction over her person. If thereafter she died, the Rules of Court prescribes the procedure whereby
a party who died during the pendency of the proceeding can be substituted. Under Section 16, Rule 3 of
the Rules of Court "whenever a party to a pending case dies * * * it shall be the duty of his attorney to
inform the court promptly of such death * * * and to give the name and residence of his executor,
administrator, guardian or other legal representatives." This duty was complied with by the counsel for
the deceased plaintiff when he manifested before the respondent Court that Fortunata Barcena died on
July 9, 1975 and asked for the proper substitution of parties in the case. The respondent Court,
however, instead of allowing the substitution, dis-missed the complaint on the ground that a dead
person has no legal personality to sue. This is a grave error. Article 777 of the Civil Code provides "that
the rights to the succession are transmitted from the moment of the death of the decedent." From the
moment of the death of the decedent, the heirs become the absolute owners of his property, subject to
the rights and obligations of the decedent, and they cannot be deprived of their rights thereto except by
the methods provided for by law.[3] The moment of death is the determining factor when the heirs
acquire a definite right to the inheritance whether such right be pure or contingent.[4] The right of the
heirs to the property of the deceased vests in them even before judicial declaration of their being heirs
in the testate or intestate proceedings.[5] When Fortunata Barcena, therefore, died her claim or right to
the parcels of land in litigation in Civil Case No. 856, was not extinguished by her death but was
transmitted to her heirs upon her death. Her heirs have thus acquired interest in the properties in
litigation and became parties in interest in the case. There is, therefore, no reason for the respondent
Court not to allow their substitution as parties in interest for the deceased plaintiff.

Under Section 17, Rule 3 of the Rules of Court "after a party dies and the claim is not thereby
extinguished, the court shall order, upon proper notice, the legal representative of the deceased to
appear and be substituted for the deceased, within such time as may be granted * * *." The question as
to whether an action survives or not depends on the nature of the action and the damage sued for.[6]
In the causes of action which survive the wrong complained affects primarily and principally property
and property rights, the injuries to the person being merely incidental, while in the causes of action
which do not survive the injury complained of is to the person, the property and rights of property
affected being incidental.[7] Following the foregoing criterion the claim of the deceased plaintiff which
is an action to quiet title over the parcels of land in litigation affects primarily and principally property
and property rights and therefore is one that survives even after her death. It is, therefore, the duty of
the respondent Court to order the legal representative of the deceased plaintiff to appear and to be
substituted for her. But what the respondent Court did, upon being informed by the counsel for the
deceased plaintiff that the latter was dead, was to dismiss the complaint. This should not have been
done for under the same Section 17, Rule 3 of the Rules of Court, it is even the duty of the court, if the
legal representative fails to appear, to order the opposing party to procure the appointment of a legal
representative of the deceased. In the instant case the respondent Court did not have to bother
ordering the opposing party to procure the appointment of a legal representative of the deceased
because her counsel has not only asked that the minor children be substituted for her but also
suggested that their uncle be appointed as guardian ad litem for them because their father is busy in
Manila earning a living for the family. But the respondent Court refused the request for substitution on
the ground that the children were still minors and cannot sue in court. This is another grave error
because the respondent Court ought to have known that under the same Section 17, Rule 3 of the Rules
of Court, the court is directed to appoint a guardian ad litem for the minor heirs. Precisely in the instant
case, the counsel for the deceased plaintiff has suggested to the respondent Court that the uncle of the
minors be appointed to act as guardian ad litem for them. Unquestionably, the respondent Court has
gravely abused its discretion in not complying with the clear provision of the Rules of Court in dismissing
the complaint of the plaintiff in Civil Case No. 856 and refusing the substitution of parties in the case.

IN VIEW OF THE FOREGOING, the order of the respondent Court dismissing the complaint in Civil Case
No. 856 of the Court of First Instance of Abra and the motions for reconsideration of the order of
dismissal of said complaint are set aside and the respondent Court is hereby directed to allow the
substitution of the minor children, who are the petitioners herein for the deceased plaintiff and to
appoint a qualified person as guardian ad litem for them. Without pronouncement as to costs. SO
ORDERED.

Teehankee, (Chairman), Makasiar, Esguerra, and Muñoz Palma, JJ., concur.

[1] Which this Court treats as special civil action as per its Resolution dated February 11, 1976.

[2] Section 16. Duty of Attorney upon death, incapacity, or incompetency of party. - Whenever a party to
a pending case dies, becomes incapacitated or incompetent, it shall be the duty of his attorney to inform
the court promptly of such death, incapacity or incompetency, and to give the name and residence of his
executor, administrator, guardian or other legal representative.

Section 17. - Death of party. - After a party dies and the claim is not thereby extinguished, the court shall
order, upon proper notice, the legal representative of the deceased to appear and to be substituted for
the deceased, within a period of thirty (30) days, or within such time as may be granted. If the legal
representative fails to appear within said time, the court may order the opposing party to procure the
appointment of a legal representative of the deceased within a time to be specified by the court, and
the representative shall immediately appear for and on behalf of the interest of the deceased. The court
charges involved in procuring such appointment, if defrayed by the opposing party, may be recovered as
costs. The heirs of the deceased may be allowed to be substituted for the deceased, without requiring
the appointment of an executor or administrator and the court may appoint guardian ad litem for the
minor heirs.

[3] Buan vs. Heirs of Buan, 53 Phil. 654.

[4] Ibarle vs. Po, 92 Phil. 721.

[5] Morales, et al. vs. Ybañez, 98 Phil. 677.

[6] Iron Gate Bank vs. Brady, 184 U.S. 665, 22 SCT 529, 46 L. ed. 739.

[7] Webber vs. St. Paul City Co., 97 Feb. 140 R. 39 C.C.A. 79.

Facts Issues Ruling Principles

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DIVISION

[ GR NO. L-46364, Apr 06, 1990 ]

SULPICIA JIMENEZ v. VICENTE FERNANDEZ +

DECISION

263 Phil. 72

PARAS, J.:

Before Us is a petition for review on certiorari of the following Decision[1] and Resolution2 of the
Honorable Court of Appeals: (1) Decision, dated March 1, 1977 in C.A.-G.R. No. 49178-R entitled
"Sulpicio Jimenez, et al., v. Vicente Fernandez, et al." affirming in toto the judgment of the Court of First
Instance of Pangasinan. Third Judicial District in Civil Case No. 14802-I between the same parties and (2)
Resolution dated June 3, 1977 denying plaintiffs-appellants' motion for reconsideration.

As gathered from the records, the factual background of this case is as follows:
The land in question is the Eastern portion with an area of Four Hundred Thirty Six (436) square meters
of that parcel of residential land situated in Barrio Dulig (now Magsaysay), Municipality of Labrador,
Pangasinan actually covered by Transfer Certificate of Title No. 82275 (Exhibit A) issued in the name of
Sulpicia Jimenez.

The entire parcel of land with an area of 2,932 square meters, formerly belonged to Fermin Jimenez.
Fermin Jimenez has two (2) sons named Fortunato and Carlos Jimenez. This Fortunato Jimenez who
predeceased his father has only one child, the petitioner Sulpicia Jimenez. After the death of Fermin
Jimenez, the entire parcel of land was registered under Act 496 in the name of Carlos Jimenez and
Sulpicia Jimenez (uncle and niece) in equal shares pro-indiviso. As a result of the registration case
Original Certificate of Title No. 50933 (Exhibit 8) was issued on February 28, 1933, in the names of Carlos
Jimenez and Sulpicia Jimenez, in equal shares pro-indiviso.

Carlos Jimenez died on July 9, 1936 and his illegitimate daughter, Melecia Cayabyab, also known as
Melecia Jimenez, took possession of the eastern portion of the property consisting of 436 square
meters.

On January 20, 1944, Melecia Jimenez sold said 436 square-meter-portion of the property to Edilberto
Cagampan and defendant Teodora Grado executed a contract entitled "Exchange of Real Properties"
whereby the former transferred said 436 square-meter-portion to the latter, who has been in
occupation since.

On August 29, 1969, plaintiff Sulpicia Jimenez executed an affidavit adjudicating unto herself the other
half of the property appertaining to Carlos Jimenez, upon manifestation that she is the only heir of her
deceased uncle. Consequently Transfer Certificate of Title No. 82275 was issued on October 1, 1969 in
petitioner's name alone over the entire 2,932 square meter-property.

On April 1, 1970, Sulpicia Jimenez, joined by her husband, instituted the present action for the recovery
of the eastern portion of the property consisting of 436 square meters occupied by defendant Teodora
Grado and her son.

After trial on the merits, the lower court rendered judgment, the dispositive portion of which reads:

"WHEREFORE, decision is hereby rendered dismissing the complaint and holding the defendant, Teodora
Grado, the absolute owner of the land in question; ordering the plaintiffs to pay to the defendant the
amount of P500.00 as damages, as attorney's fees, and to pay the costs of suit.
"SO ORDERED." (Rollo, p. 20)

Petitioner appealed the above judgment to the respondent Court of Appeals and on March 1, 1977,
respondent Court of Appeals rendered a decision affirming the same in toto. Said decision was
rendered by a special division of five (5) justices, with the Hon. Lourdes San Diego, dissenting.

Petitioners within the reglementary period granted by the Honorable Court of Appeals, filed therewith a
motion for reconsideration. But said motion for reconsideration was denied by the Court of Appeals in
its resolution dated June 3, 1977.

In their appeal to the respondent Court of Appeals from the aforequoted decision of the trial court,
herein petitioner raised the following assignments of error to wit:

ASSIGNMENTS OF ERROR

THE LOWER COURT ERRED IN NOT DECLARING THAT MELECIA CAYABYAB, ALSO KNOWN AS MELECIA
JIMENEZ, IS NOT THE DAUGHTER OF CARLOS JIMENEZ.

II

THE LOWER COURT ERRED IN NOT DECLARING THAT MELECIA CAYABYAB, ALSO KNOWN AS MELECIA
JIMENEZ, HAS NO RIGHT TO SELL THE LAND IN QUESTION TO EDILBERTO CAGAMPAN.

III

THE LOWER COURT ERRED IN NOT DECLARING THAT EDILBERTO CAGAMPAN DID NOT BECOME THE
OWNER OF THE LAND IN QUESTION BY VIRTUE OF THE DEED OF SALE (EXH. "1") EXECUTED BY MELECIA
CAYABYAB, ALIAS MELECIA JIMENEZ, IN HIS FAVOR.

IV
THE LOWER COURT ERRED IN NOT DECLARING THAT TEODORA GRADO DID NOT BECOME THE OWNER
OF THE LAND IN QUESTION BY VIRTUE OF THE DEED OF EXCHANGE (EXH. "7") EXECUTED BY HER AND
EDILBERTO CAGAMPAN.

THE LOWER COURT ERRED IN NOT DECLARING THAT THE TITLE OF APPELLANT SULPICIA JIMENEZ OVER
THE LAND IN QUESTION CAN NOT BE DEFEATED BY THE ADVERSE OPEN AND NOTORIOUS POSSESSION
OF APPELLEE TEODORA GRADO.

VI

THE LOWER COURT ERRED IN DECLARING THAT THE APPELLEE TEODORA GRADO IS THE ABSOLUTE
OWNER OF THE LAND IN QUESTION IN THE LIGHT OF THE DECISION OF THE SUPREME COURT IN THE
CASE OF LOURDES ARCUINO, ET AL., V. RUFINA APARIS AND CASIANO PURAY, G.R. NO. L-23424,
PROMULGATED JANUARY 31, 1968, WHICH CASE IS NOT APPLICABLE TO THE CASE AT BAR.

VII

THE LOWER COURT ERRED IN DISMISSING THE COMPLAINT AND ORDERING THE APPELLANTS TO PAY
THE APPELLEES THE SUM OF P500.00 AS ATTORNEY'S FEES PLUS THE COSTS.

From the foregoing, this petition for review was filed.

We find merit in the petition.

From the start the respondent court erred in not declaring that Melecia Jimenez Cayabyab also known
as Melecia Jimenez, is not the daughter of Carlos Jimenez and therefore, had no right over the property
in question. Respondents failed to present concrete evidence to prove that Melecia Cayabyab was
really the daughter of Carlos Jimenez. Nonetheless, assuming for the sake of argument that Melecia
Cayabyab was the illegitimate daughter of Carlos Jimenez there can be no question that Melecia
Cayabyab had no right to succeed to the estate of Carlos Jimenez and could not have validly acquired,
nor legally transferred to Edilberto Cagampan that portion of the property subject of this petition.
It is well-settled in this jurisdiction that the rights to the succession are transmitted from the moment of
the death of the decedent (Art. 777, Civil Code). Moreover, Art. 2263 of the Civil Code provides as
follows:

"Rights to the inheritance of a person who died with or without a will, before the effectivity of this Code,
shall be governed by the Civil Code of 1889, by other previous laws, and by the Rules of Court x x x."
(Rollo, p. 17)

Thus, since Carlos Jimenez, owner of one-half pro-indiviso portion of that parcel of land then covered by
Original Certificate of Title No. 50933, died on July 9, 1936 (Exhibit "F") way before the effectivity of the
Civil Code of the Philippines, the successional rights pertaining to his estate must be determined in
accordance with the Civil Code of 1889.

Citing the case of Cio v. Burnaman (24 SCRA 434) wherein this Court categorically held that:

"To be an heir under the rules of Civil Code of 1889 (which was the law in force when Carlos Jimenez
died and which should be the governing law in so far as the right to inherit from his estate was
concerned), a child must be either a child legitimate, legitimated, or adopted, or else an acknowledged
natural child -- for illegitimate not natural are disqualified to inherit." (Civil Code of 1889, Art. 807, 935)

Even assuming that Melecia Cayabyab was born out of the common-law-relationship between her
mother (Maria Cayabyab) and Carlos Jimenez, she could not even be considered an acknowledged
natural child because Carlos Jimenez was then legally married to Susana Abalos and therefore not
qualified to marry Maria Cayabyab and consequently Melecia Cayabyab was an illegitimate spurious
child and not entitled to any successional rights in so far as the estate of Carlos Jimenez was concerned.

Melecia Cayabyab in the absence of any voluntary conveyance to her by Carlos Jimenez or Sulpicia
Jimenez of the litigated portion of the land could not even legally transfer parcel of land to Edilberto
Cagampan who accordingly, could not also legally transfer the same to herein private respondents.

Analyzing the case before Us in this manner, We can immediately discern another error in the decision
of the respondent court, which is that the said court sustained and made applicable to the case at bar
the ruling in the case of Arcuino, et al., v. Aparis and Puray, No. L-23424, January 31, 1968, 22 SCRA 407,
wherein We held that:

"x x x it is true that the lands registered under the Torren's System may not be acquired by prescription
but plaintiffs herein are not the registered owners. They merely claim to have acquired by succession,
their alleged title or interest in lot No. 355. At any rate plaintiffs herein are guilty of laches."

The respondent court relying on the Arcuino case, concluded that respondents had acquired the
property under litigation by prescription. We cannot agree with such conclusion, because there is one
very marked and important difference between the case at bar and that of the Arcuino case, and that is,
that since 1933 petitioner Sulpicia Jimenez was a title holder, the property then being registered in her
and her uncle Carlos Jimenez' name. In the Arcuino case, this Supreme Court held, "(I)t is true that lands
registered under the Torren's System may not be acquired by prescription but plaintiffs herein are not
the registered owners." (Rollo, p. 38) Even in the said cited case the principle of imprescriptibility of
Torrens Titles was respected.

Melecia Cayabyab's possession or of her predecessors-in-interest would be unavailing against the

petitioner Sulpicia Jimenez who was the holder pro-indiviso with Carlos Jimenez of the Torrens
Certificate of Title covering a tract of land which includes the portion now in question, from February 28,
1933, when the Original Certificate of Title No. 50933 (Exhibit 8) was issued.

"No possession by any person of any portion of the land covered by said original certificate of titles,
could defeat the title of the registered owner of the land covered by the certificate of title." (Benin v.
Tuason, L-26127, June 28, 1974, 57 SCRA 531)

Sulpicia's title over her one-half undivided property remained good and continued to be good when she
segregated it into a new title (T.C.T. No. 82275, Exhibit "A") in 1969. Sulpicia's ownership over her one-
half of the land and which is the land in dispute was always covered by a Torrens title, and therefore, no
amount of possession thereof by the respondents, could ever defeat her proprietary rights thereon. It is
apparent, that the right of plaintiff (now petitioner) to institute this action to recover possession of the
portion of the land in question based on the Torrens Title of Sulpicia Jimenez, T.C.T. No. 82275 (Exhibit
"A") is imprescriptible and not barred under the doctrine of laches. (J. M. Tuason & Co. v. Macalindong,
L-15398, December 29, 1962, Francisco v. Cruz, et al., 43 O.G. 5105) (Rollo, p. 39)

The respondent Court of Appeals declared the petitioner Sulpicia Jimenez guilty of laches and citing the
ruling in the case of Heirs of Lacamen v. Heirs of Laruan (65 SCRA 605), held that, since petitioner
Sulpicia Jimenez executed her Affidavit of Self-Adjudication only in 1969, she lost the right to recover
possession of the parcel of land subject of the litigation.

In this instance, again We rule for the petitioner. There is no absolute rule as to what constitutes laches
or staleness of demand; each case is to be determined according to its particular circumstances. The
question of laches is addressed to the sound discretion of the court and since laches is an equitable
doctrine, its application is controlled by equitable considerations. It cannot be worked to defeat justice
or to perpetrate fraud and injustice. It would be rank injustice and patently inequitous to deprive the
lawful heirs of their rightful inheritance.

Petitioner Sulpicia Jimenez is entitled to the relief prayed for, declaring her to be the sole and absolute
owner of the land in question with right to its possession and enjoyment. Since her uncle Carlos Jimenez
died in 1936, his pro-indiviso share in the properties then owned in co-ownership with his niece Sulpicia
descended by intestacy to Sulpicia Jimenez alone because Carlos died without any issue or other heirs.
After all, the professed objective of Act No. 496, otherwise known as the Land Registration Act or the
law which established the Torrens System of Land Registration in the Philippines is that the stability of
the landholding system in the Philippines depends on the confidence of the people in the titles covering
the properties. And to this end, this Court has invariably upheld the indefeasibility of the Torrens Title
and in, among others, J. M. Tuazon and Co., Inc. v. Macalindong (6 SCRA 938), held that "the right of the
appellee to file an action to recover possession based on its Torrens Title is imprescriptible and not
barred under the doctrine of laches."

WHEREFORE, the Petition for Review is hereby GRANTED. The Decision and Resolution dated March 1,
1977 and June 3, 1977 in CA G.R. No. L-49178-R are SET ASIDE.

SO ORDERED.