LIU vs. LOY G.R. No.

145982, September 13, 2004 FACTS: Teodoro Vao, in his capacity as Attorney-in-Fact of Jose Vao, sold Lot Nos. 5 and 6 to BENITO LIU on 13 January 1950, or prior to the death of Jose Vao on 28 January 1950. On 22 April 1966, Benito Liu sold the lots to Frank Liu. On 19 August 1968, Teodoro Vao sold Lot No. 6 to Teresita Loy while Lot No. 5 was sold to Alfredo Loy, Jr. on 16 December 1969. Prior to the sale of the above-mentioned lots to the Loys, Teodoro Vao wrote Frank Liu a letter and it was apparently shown that the latter offered to settle the whole balance of the lot should the title be immediately transferred in his brothers name and Mr. Pangalos. The letter also informed Liu of Supreme Courts decision regarding all the sales Vao had made over the properties of his father to be legal. The Loys, on the other hand, insisted that the transaction between Teodoro Vao and Benito Liu was a contract to sell while the transaction between the former and Teodoro Vao was a contract of sale and that the contracts of sale in favor of the Loys transferred ownership as the conveyances were absolute. ISSUE: W/N the sale of the lots by Teodoro Vao to Benito Liu was valid. HELD: YES. The SC held that a prior contract to sell made by the decedent during his lifetime PREVAILS over a subsequent contract of sale made by the administrator without probate court approval. It is immaterial if the prior contract is a mere contract to sell and does not immediately convey ownership. Moreover, Frank Lius contract to sell became valid and effective, upon its execution and bound the estate to convey the property upon full payment of the consideration. The orders of the probate court dated 19 and 23 March 1976 approving the contracts of sale to the Loys are VOID and did not ratify the sales because there was already a prior order of the probate courted dated 24 February 1976 approving the sale of Lot Nos. 5 and 6 to Frank Liu. Hence, the probate court had already lost jurisdiction over Lot Nos. 5 and 6 since the lots no longer formed part of the Estate of Jose Vao. GREPALIFE vs. CA G.R. No. 113899, Oct. 13, 1999 FACTS: A contract of group life insurance was executed between petitioner GREPALIFE and DBP where the latter agreed to insure the lives of eligible housing loan mortgagor of DBP. Dr. Wilfredo Leuterio, a housing debtor of DBP, applied for membership in the group life insurance plan of DBP under its insurer, GREPALIFE and was issued by GREPALIFE Certificate No. B-18558 to the extent of his indebtedness, in the amount of Php 86,200.00. After Dr. Leuterios death, his

widow, Medarda V. Leuterio filed a complaint for Specific Performance with Damages against GREPALIFE. The trial court rendered its decision in favor of therein complainant, Mrs. Leuterio. On appeal, GREPALIFE contended: (1) that DBP, as beneficiary in a group life insurance contract has to be made liable for the claims filed by Mrs. Leuterio; (2) to annul the insurance contract because of concealment; and (3) that respondent failed to establish the amount of Dr. Leuterios outstanding indebtedness to DBP at the time of the mortgagors death. ISSUE: W/N the property right in the insurance policy of Dr. Leuterio is extinguished upon his death. HELD: NO. P r o p e r t y right in an insurance policy is not extinguished by death only when the designation is irrevocable. The beneficiary has a vested right to the life insurance unless otherwise provided in the policy. In the case at bar, the insurance policy states that upon the receipt of due proof of the debtors death during the terms of the insurance, a death benefit in the amount of Php 86,200.00 shall be paid. In the event of the debtors death before his indebtedness with the creditor shall have been fully paid, an amount to pay the outstanding indebtedness shall first be paid to the creditor and the balance of the sum assured, if there is any, shall then be paid to the beneficiary/ies designated by the debtor. However, since it was noted that after CA promulgated its decision on 17 May 1993, the DBP foreclosed the residential lot of Leuterio in 1995, in satisfaction of mortgagors outstanding loan. Considering this supervening event, the insurance proceeds shall inure to the benefit of the heirs of the deceased person or his beneficiaries, as equity dictates that DBP should not unjustly enrich itself at the expense of another (nemo cum alterius detrimenio protest). It cannot collect the insurance proceeds after it already foreclosed the mortgage. Hence, the proceeds now rightly belong to Dr. Leuterios heirs represented by his widow.