SUB- AGENCY

G.R. No. 130423

November 18, 2002

SERONA vs. HON. COURT OF APPEALS

Leonida Quilatan delivered pieces of jewelry to petitioner Serona to be sold on
commission basis. By oral agreement of the parties, petitioner shall remit payment or
return the pieces of jewelry if not sold to Quilatan, both within 30 days from receipt of
the items. Upon petitioners failure to pay, Quilatan required her to execute an
acknowledgment receipt signed by petitioner and witness Navarette. Uknown to
Quilatan, petitioner had earlier entrusted the jewelry to Labrador for the latter to sell on
commission basis. Petitioner was not able to collect payment from Labrador, which
caused her to likewise fail to pay her obligation to Quilatan. Failure of petitioner to settle
obligation upon demand, Quilatan filed an information for estafa against petitioner. The
trial court found petitioner Serona of the crime charged guilty beyond reasonable doubt.
Petitioner appealed to the Court of Appeals, which affirmed the judgment of conviction.
Hence this petition for review on the ground that the prosecution failed to establish the
elements of estafa.
ISSUE: WON THERE WAS AN ABUSE OF CONFIDENCE ON THE PART OF
PETITIONER IN ENTRUSTING THE SUBJECT JEWELRIES TO HER SUB-AGENT FOR
SALE ON COMMISSION TO PROSPECTIVE BUYERS.
RULING: NONE. Petitioner did not ipso facto commit the crime of estafa through
conversion or misappropriation by delivering the jewelry to a sub-agent for sale on
commission basis. It must be pointed out that the law on agency in our jurisdiction allows
the appointment by an agent of a substitute or sub-agent in the absence of an express
agreement to the contrary between the agent and the principal. Consequently, there is
no conversion since the pieces of jewelry were not devoted to a purpose or use different
from that agreed upon. The pieces of jewelry were given by petitioner to Labrador to
achieve the very same end for which they were delivered to her in the first place.
WHEREFORE, THE PETITION IS GRANTED.

G.R. No. 137162

January 24, 2007

ESCUETA vs. LIM

Respondent Rufina Lim filed an action to remove cloud on, or quiet title to, real property,
with preliminary injunction and issuance of [a hold-departure order] from the Philippines
against Ignacio E. Rubio. Respondent amended her complaint to include specific
performance and damages.

In her amended complaint, respondent averred inter alia that she bought the hereditary
shares (consisting of 10 lots) of Ignacio Rubio [and] the heirs of Luz Baloloy, namely:
Alejandrino, Bayani, and other co-heirs; that said vendors executed a contract of sale
dated April 10, 1990 in her favor; that Ignacio Rubio and the heirs of Luz Baloloy received
[a down payment] or earnest money in the amount of P102,169.86 and P450,000,
respectively; that it was agreed in the contract of sale that the vendors would secure
certificates of title covering their respective hereditary shares; that the balance of the
purchase price would be paid to each heir upon presentation of their individual
certificate[s] of [title]; that Ignacio Rubio refused to receive the other half of the down
payment which is P[100,000]; that Ignacio Rubio refused and still refuses to deliver to
[respondent] the certificates of title covering his share on the two lots; that with respect
to the heirs of Luz Baloloy, they also refused and still refuse to perform the delivery of
the two certificates of title covering their share in the disputed lots; that respondent was
and is ready and willing to pay Ignacio Rubio and the heirs of Luz Baloloy upon
presentation of their individual certificates of title, free from whatever lien and
encumbrance;

As to petitioner Corazon Escueta, in spite of her knowledge that the disputed lots have
already been sold by Ignacio Rubio to respondent, it is alleged that a simulated deed of
sale involving said lots was effected by Ignacio Rubio in her favor; and that the simulated
deed of sale by Rubio to Escueta has raised doubts and clouds over respondents title.

In their separate amended answers, petitioners denied the material allegations of the
complaint and alleged inter alia the following:

For the heirs of Luz Baloloy (Baloloys for brevity):

Respondent has no cause of action, because the subject contract of sale has no more
force and effect as far as the Baloloys are concerned, since they have withdrawn their
offer to sell for the reason that respondent failed to pay the balance of the purchase
price as orally promised on or before May 1, 1990.

For petitioners Ignacio Rubio (Rubio for brevity) and Corazon Escueta (Escueta for
brevity):

Respondent has no cause of action, because Rubio has not entered into a contract of sale
with her; that he has appointed his daughter Patricia Llamas to be his attorney-in-fact
and not in favor of Virginia Rubio Laygo Lim (Lim for brevity) who was the one who
represented him in the sale of the disputed lots in favor of respondent; that the P100,000
respondent claimed he received as down payment for the lots is a simple transaction by
way of a loan with Lim.

The Baloloys failed to appear at the pre-trial. Upon motion of respondent, the trial court
declared the Baloloys in default. They then filed a motion to lift the order declaring them
in default, which was denied by the trial court in an order dated November 27, 1991.
Consequently, respondent was allowed to adduce evidence ex parte. Thereafter, the trial
court rendered a partial decision dated July 23, 1993 against the Baloloys, the dispositive
portion of which reads as follows:

IN VIEW OF THE FOREGOING, judgment is hereby rendered in favor of [respondent] and

against [petitioners, heirs] of Luz R. Balolo[y], namely: Alejandrino Baloloy and Bayani
Baloloy. The [petitioners] Alejandrino Baloloy and Bayani Baloloy are ordered to
immediately execute an [Absolute] Deed of Sale over their hereditary share in the
properties covered by TCT No. 74392 and TCT No. 74394, after payment to them by
[respondent] the amount of P[1,050,000] or consignation of said amount in Court. [For]
failure of [petitioners] Alejandrino Baloloy and Bayani Baloloy to execute the Absolute
Deed of Sale over their hereditary share in the property covered by TCT No. T-74392 and
TCT No. T-74394 in favor of [respondent], the Clerk of Court is ordered to execute the
necessary Absolute Deed of Sale in behalf of the Baloloys in favor of [respondent,] with a
consideration of P[1,500,000]. Further[,] [petitioners] Alejandrino Baloloy and Bayani
Baloloy are ordered to jointly and severally pay [respondent] moral damages in the
amount of P[50,000] and P[20,000] for attorneys fees. The adverse claim annotated at
the back of TCT No. T-74392 and TCT No. T-74394[,] insofar as the shares of Alejandrino
Baloloy and Bayani Baloloy are concerned[,] [is] ordered cancelled.

With costs against [petitioners] Alejandrino Baloloy and Bayani Baloloy.

SO ORDERED.3

The Baloloys filed a petition for relief from judgment and order dated July 4, 1994 and
supplemental petition dated July 7, 1994. This was denied by the trial court in an order
dated September 16, 1994. Hence, appeal to the Court of Appeals was taken challenging

the order denying the petition for relief.

Trial on the merits ensued between respondent and Rubio and Escueta. After trial, the
trial court rendered its assailed Decision, as follows:

IN VIEW OF THE FOREGOING, the complaint [and] amended complaint are dismissed
against [petitioners] Corazon L. Escueta, Ignacio E. Rubio[,] and the Register of Deeds.
The counterclaim of [petitioners] [is] also dismissed. However, [petitioner] Ignacio E.
Rubio is ordered to return to the [respondent], Rufina Lim[,] the amount of
P102,169.80[,] with interest at the rate of six percent (6%) per annum from April 10,
[1990] until the same is fully paid. Without pronouncement as to costs.

SO ORDERED.4

On appeal, the CA affirmed the trial courts order and partial decision, but reversed the
later decision. The dispositive portion of its assailed Decision reads:

WHEREFORE, upon all the foregoing premises considered, this Court rules:

1. the appeal of the Baloloys from the Order denying the Petition for Relief from
Judgment and Orders dated July 4, 1994 and Supplemental Petition dated July 7, 1994 is
DISMISSED. The Order appealed from is AFFIRMED.

2. the Decision dismissing [respondents] complaint is REVERSED and SET ASIDE and a
new one is entered. Accordingly,

a. the validity of the subject contract of sale in favor of [respondent] is upheld.

b. Rubio is directed to execute a Deed of Absolute Sale conditioned upon the payment of
the balance of the purchase price by [respondent] within 30 days from the receipt of the
entry of judgment of this Decision.

c. the contracts of sale between Rubio and Escueta involving Rubios share in the
disputed properties is declared NULL and VOID.

d. Rubio and Escueta are ordered to pay jointly and severally the [respondent] the
amount of P[20,000] as moral damages and P[20,000] as attorneys fees.

3. the appeal of Rubio and Escueta on the denial of their counterclaim is DISMISSED.

SO ORDERED.5

Petitioners Motion for Reconsideration of the CA Decision was denied. Hence, this
petition.

The issues are:

THE HONORABLE COURT OF APPEALS ERRED IN DENYING THE PETITION FOR RELIEF
FROM JUDGMENT FILED BY THE BALOLOYS.

II

THE HONORABLE COURT OF APPEALS ERRED IN REINSTATING THE COMPLAINT AND IN

AWARDING MORAL DAMAGES AND ATTORNEYS FEES IN FAVOR OF RESPONDENT RUFINA
L. LIM CONSIDERING THAT:

A. IGNACIO E. RUBIO IS NOT BOUND BY THE CONTRACT OF SALE BETWEEN VIRGINIA

LAYGO-LIM AND RUFINA LIM.

B. THE CONTRACT ENTERED INTO BETWEEN RUFINA LIM AND VIRGINIA LAYGO-LIM IS A
CONTRACT TO SELL AND NOT A CONTRACT OF SALE.

C. RUFINA LIM FAILED TO FAITHFULLY COMPLY WITH HER OBLIGATIONS UNDER THE
CONTRACT TO SELL THEREBY WARRANTING THE CANCELLATION THEREOF.

D. CORAZON L. ESCUETA ACTED IN UTMOST GOOD FAITH IN ENTERING INTO THE

CONTRACT OF SALE WITH IGNACIO E. RUBIO.

III

THE CONTRACT OF SALE EXECUTED BETWEEN IGNACIO E. RUBIO AND CORAZON L.

ESCUETA IS VALID.

IV

THE HONORABLE
COUNTERCLAIMS.

COURT

OF

APPEALS

ERRED

IN

DISMISSING

PETITIONERS

Briefly, the issue is whether the contract of sale between petitioners and respondent is
valid.

Petitioners argue, as follows:

First, the CA did not consider the circumstances surrounding petitioners failure to appear
at the pre-trial and to file the petition for relief on time.

As to the failure to appear at the pre-trial, there was fraud, accident and/or excusable

neglect, because petitioner Bayani was in the United States. There was no service of the
notice of pre-trial or order. Neither did the former counsel of record inform him.
Consequently, the order declaring him in default is void, and all subsequent proceedings,
orders, or decision are void.

Furthermore, petitioner Alejandrino was not clothed with a power of attorney to appear
on behalf of Bayani at the pre-trial conference.

Second, the sale by Virginia to respondent is not binding. Petitioner Rubio did not
authorize Virginia to transact business in his behalf pertaining to the property. The
Special Power of Attorney was constituted in favor of Llamas, and the latter was not
empowered to designate a substitute attorney-in-fact. Llamas even disowned her
signature appearing on the "Joint Special Power of Attorney," which constituted Virginia
as her true and lawful attorney-in-fact in selling Rubios properties.

Dealing with an assumed agent, respondent should ascertain not only the fact of agency,
but also the nature and extent of the formers authority. Besides, Virginia exceeded the
authority for failing to comply with her obligations under the "Joint Special Power of
Attorney."

The amount encashed by Rubio represented not the down payment, but the payment of
respondents debt. His acceptance and encashment of the check was not a ratification of
the contract of sale.

Third, the contract between respondent and Virginia is a contract to sell, not a contract
of sale. The real character of the contract is not the title given, but the intention of the
parties. They intended to reserve ownership of the property to petitioners pending full
payment of the purchase price. Together with taxes and other fees due on the properties,
these are conditions precedent for the perfection of the sale. Even assuming that the
contract is ambiguous, the same must be resolved against respondent, the party who
caused the same.

Fourth, Respondent failed to faithfully fulfill her part of the obligation. Thus, Rubio had
the right to sell his properties to Escueta who exercised due diligence in ascertaining
ownership of the properties sold to her. Besides, a purchaser need not inquire beyond
what appears in a Torrens title.

The petition lacks merit. The contract of sale between petitioners and respondent is
valid.lawphil.net

Bayani Baloloy was represented by his attorney-in-fact, Alejandrino Baloloy. In the

Baloloys answer to the original complaint and amended complaint, the allegations
relating to the personal circumstances of the Baloloys are clearly admitted.

"An admission, verbal or written, made by a party in the course of the proceedings in the
same case, does not require proof."6 The "factual admission in the pleadings on record
[dispenses] with the need x x x to present evidence to prove the admitted fact."7 It
cannot, therefore, "be controverted by the party making such admission, and [is]
conclusive"8 as to them. All proofs submitted by them "contrary thereto or inconsistent
therewith should be ignored whether objection is interposed by a party or not."9 Besides,
there is no showing that a palpable mistake has been committed in their admission or
that no admission has been made by them.

Pre-trial is mandatory.10 The notices of pre-trial had been sent to both the Baloloys and
their former counsel of record. Being served with notice, he is "charged with the duty of
notifying the party represented by him."11 He must "see to it that his client receives
such notice and attends the pre-trial."12 What the Baloloys and their former counsel
have alleged instead in their Motion to Lift Order of As In Default dated December 11,
1991 is the belated receipt of Bayani Baloloys special power of attorney in favor of their
former counsel, not that they have not received the notice or been informed of the
scheduled pre-trial. Not having raised the ground of lack of a special power of attorney in
their motion, they are now deemed to have waived it. Certainly, they cannot raise it at
this late stage of the proceedings. For lack of representation, Bayani Baloloy was
properly declared in default.

Section 3 of Rule 38 of the Rules of Court states:

SEC. 3. Time for filing petition; contents and verification. A petition provided for in
either of the preceding sections of this Rule must be verified, filed within sixty (60) days
after the petitioner learns of the judgment, final order, or other proceeding to be set
aside, and not more than six (6) months after such judgment or final order was entered,
or such proceeding was taken; and must be accompanied with affidavits showing the

fraud, accident, mistake, or excusable negligence relied upon, and the facts constituting
the petitioners good and substantial cause of action or defense, as the case may be.

There is no reason for the Baloloys to ignore the effects of the above-cited rule. "The 60day period is reckoned from the time the party acquired knowledge of the order,
judgment or proceedings and not from the date he actually read the same."13 As aptly
put by the appellate court:

The evidence on record as far as this issue is concerned shows that Atty. Arsenio Villalon,
Jr., the former counsel of record of the Baloloys received a copy of the partial decision
dated June 23, 1993 on April 5, 1994. At that time, said former counsel is still their
counsel of record. The reckoning of the 60 day period therefore is the date when the said
counsel of record received a copy of the partial decision which was on April 5, 1994. The
petition for relief was filed by the new counsel on July 4, 1994 which means that 90 days
have already lapsed or 30 days beyond the 60 day period. Moreover, the records further
show that the Baloloys received the partial decision on September 13, 1993 as
evidenced by Registry return cards which bear the numbers 02597 and 02598 signed by
Mr. Alejandrino Baloloy.

The Baloloys[,] apparently in an attempt to cure the lapse of the aforesaid reglementary
period to file a petition for relief from judgment[,] included in its petition the two Orders
dated May 6, 1994 and June 29, 1994. The first Order denied Baloloys motion to fix the
period within which plaintiffs-appellants pay the balance of the purchase price. The
second Order refers to the grant of partial execution, i.e. on the aspect of damages.
These Orders are only consequences of the partial decision subject of the petition for
relief, and thus, cannot be considered in the determination of the reglementary period
within which to file the said petition for relief.

Furthermore, no fraud, accident, mistake, or excusable negligence exists in order that

the petition for relief may be granted.14 There is no proof of extrinsic fraud that
"prevents a party from having a trial x x x or from presenting all of his case to the
court"15 or an "accident x x x which ordinary prudence could not have guarded against,
and by reason of which the party applying has probably been impaired in his rights."16
There is also no proof of either a "mistake x x x of law"17 or an excusable negligence
"caused by failure to receive notice of x x x the trial x x x that it would not be necessary
for him to take an active part in the case x x x by relying on another person to attend to
the case for him, when such other person x x x was chargeable with that duty x x x, or
by other circumstances not involving fault of the moving party."18

Article 1892 of the Civil Code provides:

Art. 1892. The agent may appoint a substitute if the principal has not prohibited him
from doing so; but he shall be responsible for the acts of the substitute:

(1) When he was not given the power to appoint one x x x.

Applying the above-quoted provision to the special power of attorney executed by

Ignacio Rubio in favor of his daughter Patricia Llamas, it is clear that she is not prohibited
from appointing a substitute. By authorizing Virginia Lim to sell the subject properties,
Patricia merely acted within the limits of the authority given by her father, but she will
have to be "responsible for the acts of the sub-agent,"19 among which is precisely the
sale of the subject properties in favor of respondent.

Even assuming that Virginia Lim has no authority to sell the subject properties, the
contract she executed in favor of respondent is not void, but simply unenforceable,
under the second paragraph of Article 1317 of the Civil Code which reads:

Art. 1317. x x x

A contract entered into in the name of another by one who has no authority or legal
representation, or who has acted beyond his powers, shall be unenforceable, unless it is
ratified, expressly or impliedly, by the person on whose behalf it has been executed,
before it is revoked by the other contracting party.

Ignacio Rubio merely denies the contract of sale. He claims, without substantiation, that
what he received was a loan, not the down payment for the sale of the subject
properties. His acceptance and encashment of the check, however, constitute ratification
of the contract of sale and "produce the effects of an express power of agency."20 "[H]is
action necessarily implies that he waived his right of action to avoid the contract, and,
consequently, it also implies the tacit, if not express, confirmation of the said sale
effected" by Virginia Lim in favor of respondent.

Similarly, the Baloloys have ratified the contract of sale when they accepted and enjoyed
its benefits. "The doctrine of estoppel applicable to petitioners here is not only that which
prohibits a party from assuming inconsistent positions, based on the principle of election,
but that which precludes him from repudiating an obligation voluntarily assumed after
having accepted benefits therefrom. To countenance such repudiation would be contrary
to equity, and would put a premium on fraud or misrepresentation."21

Indeed, Virginia Lim and respondent have entered into a contract of sale. Not only has
the title to the subject properties passed to the latter upon delivery of the thing sold, but
there is also no stipulation in the contract that states the ownership is to be reserved in
or "retained by the vendor until full payment of the price."22

Applying Article 1544 of the Civil Code, a second buyer of the property who may have
had actual or constructive knowledge of such defect in the sellers title, or at least was
charged with the obligation to discover such defect, cannot be a registrant in good faith.
Such second buyer cannot defeat the first buyers title. In case a title is issued to the
second buyer, the first buyer may seek reconveyance of the property subject of the
sale.23 Even the argument that a purchaser need not inquire beyond what appears in a
Torrens title does not hold water. A perusal of the certificates of title alone will reveal that
the subject properties are registered in common, not in the individual names of the heirs.

Nothing in the contract "prevents the obligation of the vendor to convey title from
becoming effective"24 or gives "the vendor the right to unilaterally resolve the contract
the moment the buyer fails to pay within a fixed period."25 Petitioners themselves have
failed to deliver their individual certificates of title, for which reason it is obvious that
respondent cannot be expected to pay the stipulated taxes, fees, and expenses.

"[A]ll the elements of a valid contract of sale under Article 1458 of the Civil Code are
present, such as: (1) consent or meeting of the minds; (2) determinate subject matter;
and (3) price certain in money or its equivalent."26 Ignacio Rubio, the Baloloys, and their
co-heirs sold their hereditary shares for a price certain to which respondent agreed to
buy and pay for the subject properties. "The offer and the acceptance are concurrent,
since the minds of the contracting parties meet in the terms of the agreement."27

In fact, earnest money has been given by respondent. "[I]t shall be considered as part of

the price and as proof of the perfection of the contract.28 It constitutes an advance
payment to "be deducted from the total price."29

Article 1477 of the same Code also states that "[t]he ownership of the thing sold shall be
transferred to the vendee upon actual or constructive delivery thereof."30 In the present
case, there is actual delivery as manifested by acts simultaneous with and subsequent to
the contract of sale when respondent not only took possession of the subject properties
but also allowed their use as parking terminal for jeepneys and buses. Moreover, the
execution itself of the contract of sale is constructive delivery.

Consequently, Ignacio Rubio could no longer sell the subject properties to Corazon
Escueta, after having sold them to respondent. "[I]n a contract of sale, the vendor loses
ownership over the property and cannot recover it until and unless the contract is
resolved or rescinded x x x."31 The records do not show that Ignacio Rubio asked for a
rescission of the contract. What he adduced was a belated revocation of the special
power of attorney he executed in favor of Patricia Llamas. "In the sale of immovable
property, even though it may have been stipulated that upon failure to pay the price at
the time agreed upon the rescission of the contract shall of right take place, the vendee
may pay, even after the expiration of the period, as long as no demand for rescission of
the contract has been made upon him either judicially or by a notarial act."32

WHEREFORE, the petition is DENIED. The Decision and Resolution of the Court of Appeals
in CA-G.R. CV No. 48282, dated

LIABILITY FOR INTEREST

G.R. No. L-31739

March 11, 1930

MENDEZONA vs. VIUDA DE GOITIA

The plaintiffs, Leonor Mendezona and Valentina Izaguirre y Nazabal, filed separate claims
with the committee of claims and appraisal against the intestate estate of Benigno Goitia
y Lazaga (Court of First Instance of Manila, civil case No. 30273), the first for the amount
of P5,940, and the second, P2,376. By order of the court dated June 16, 1927, these
claims were heard by the committee. The claimants presented their evidence, which the
committee deemed insufficient and disapproved their claims. Both claimants appealed
from the report of the committee, and in accordance with section 776 of the Code of Civil
Procedure, filed a new complaint which was later amended with the approval of the

court, there being nothing in the bill of exceptions to show that the defendant, or the
administratrix of the deceased Benigno Goitia, excepted to the court's order admitting
the amendments to the complaints.

The defendant answered the amended complaints, pleading in special defense, that not
having no knowledge of the supposed management of their rights in the "Tren de
Aguadas," and , furthermore, not having seen nor received any money of the plaintiff's
from said business, she is not in a position to render an account of any sort to the
plaintiffs, either in her own personal capacity or as judicial administratrix of Benigno
Goitia's intestate estate.

By agreement of the parties, both cases were tried together, and the trial court rendered
but one decision upon them on October 31, 1928, holding it sufficiently proved, "that
defendant Encarnacion C. Vda, de Goitia has been duly appointed judicial administratrix
of the estate of her deceased husband Benigno Goitia in special proceeding No. 30273 of
this court; that Benigno Goitia was the representative and attorney-in-fact of the
plaintiffs in the joint-account partnership known as the "Tren de Aguadas" and located in
the City of Manila, of which the plaintiff Leonor Mendezona, widow of Juan Bautista
Goitia, owns 180 shares worth P18,000, and the plaintiff Valentina Izaguirre y Nazabal
owns 72 shares worth P7,200; that prior to 1915, Benigno Goitia, at that time the
manager of the aforesaid co-partnership, collected the dividends for the plaintiffs, which
he remitted to them every year; that prior to 1915, the usual dividends which Benigno
Goitia forwarded to plaintiff Leonor Mendezona each year were P540, and to plaintiff
Valentina Izaguirre y Nazabal, P216; that from 1915 until his death in August, 1926,
Benigno Goitia failed to remit to the dividends upon their shares in the "Tren de
Aguadas"; that some time before his death, more particularly, in July, 1926, Benigno
Goitia, who was no longer the manager of the said business, receive as attorney-in-fact
of both plaintiff, the amount of P90 as dividend upon plaintiff Leonor Mendezona's
shares, and P36 upon Valentina Izaguirre y Nazabal's stock; that from 1915 to 1926, the
"Tren de Aguadas" paid dividends to the share-holders, one of them, Ramon Salinas,
having received the total amount of P1,155 as ordinary and special dividends upon his
15 shares' that calculating the dividends due from 1915 to 1926 upon Leonor
Mendezona's 180 shares at P540 per annum, and at P216 yearly upon the 72 shares held
by Valentina Izaguirre y Nazabal, counsel for both plaintiffs filed their claims with the
committee of claims and appraisal of the estate of Benigno Goitia, and, upon their
disallowance, appealed from the committee's decision by means of the complaints in
these two cases."

The trial court likewise deemed it proven that "during the period from 1915 to 1926,
Benigno Goitia collected and received certain sums as dividends and profits upon the

plaintiffs's stock in the "Tren de Aguadas" in his capacity as representative and attorneyin-fact for both of them, which he has neither remitted nor accounted for to the said
plaintiffs, although it has been prove that said Benigno Goitia was their attorney-in-fact
and representative in the "Tren de Aguadas" up to the time of his death."

The court below therefore ordered the defendant, as judicial administratrix of Benigno
Goitia's estate to render a judicial account of the intestate estate of the deceased
Benigno Goitia, in special proceeding No. 30273 of this court (below), to render an
account of the amounts collected by her aforesaid husband Benigno Goitia, as attorneyin-fact and representative of the plaintiffs Leonor Mendezona and Valentina Izaguirre y
Nazabal in the copartnership known as the "Tren de Aguadas" from 1915 to July, 1926,
within thirty days from notice of this decision; and that the defendant may see, examine,
and make a copy of the books and documents relative to the business of the
aforementioned copartnership, in accordance with the provisions of section 664 of the
Code of Civil Procedure. Without special pronouncement of costs.

On December 15, 1928, at the instance of the plaintiffs, the trial court set the 15th of
January, 1929, as the date on which the defendant should present her account of the
dividends and profits collected by the decedent, as attorney-in-fact for the plaintiffs, with
regard to the "Tren de Aguatas" copartnership, form 1915 to 1926, and the hearing was
postponed to the 7th of February, 1929.

On February 6, 1929, the defendant, reiterating her exception to the court's decision
enjoining her to render accounts, manifested that after a painstaking examination of the
books of account of the copartnership "Tren de Aguadas," and several attempts to obtain
data from Ruperto Santos, the manager and administrator thereof, she has found no
more evidence of any amount received by her late husband, Benigno de Goitia, than a
book of accounts where she came upon an item of P90 for Leonor Mendezona, and
another of P36 for Valentina Izaguirre.

In view of this report and the evidence taken at the hearing the court rendered a
suppletory judgment, upon motion of the plaintiffs dated December 3, 1928; and taking
into account chiefly the testimony of Ruperto Santos and Ramon Salinas, it was held
that, upon the basis of the dividends received by the witness Salinas on his fifteen shares
in the "Tren de Aguadas" from 1915 to 1925, it appears that the dividends distributed for
each share was equal to one-fifteenth of P1,087.50, that is P72.50. Thus the dividends
upon plaintiff Leonor Mendezona's 180 shares would be P13,050, and upon the 72 shares
pertaining to Valentina Izaguirre, P5,220; and these sums, added to those collected by

the attorney-in-fact Benigno Goitia as part of the 1926 dividends, P90 for Leonor
Mendezona, and P36 for Valentina Izaguirre, show that Benigno Goitia thereby received
P13,140 in behalf of Leonor Mendezona, and P5,256 in behalf of Valentina Izaguirre.

Wherefore, the court ordered the defendant, as judicial administratrix of the estate of the
deceased Benigno Goitia, to pay the plaintiff Leonor Mendezona the sum of P13,140 with
legal interest from the date of the filing of the complaint, and to pay the plaintiff
Valentina Izaguirre P5,256 likewise with legal interest from the date of the filing of the
complaint, and moreover, to pay the costs of both instances.

The defendant duly appealed from this judgment to this Supreme Court through the
proper bill of exceptions.

The fundamental question raised by the appellant in the first assignment of error refers
to the court's jurisdiction to admit the amended complaints whereby the plaintiffs claim
P13,680 and P5,470 respectively, whereas the claims presented to the committee of
claims and appraisal were only for P5,940 and P2,376, respectively. Appellant contends
that the plaintiffs have not perfected their appeal in accoundance with section 773 of the
Code of Civil Procedure in claiming more in their complaints than in the claims filed with
the committee of claims and appraisal, by including therein, not only the yearly
dividends paid from 1915 to 1925, inclusive, but also the ordinary and extraordinary
dividends upon their shares for the years of 1915 to 1926, alleged to have been
delivered to Benigno Goitia.

The fact that the claims filed with the committee were upon the basis of annual
dividends, while those filed with the court below were on ordinary and extraordinary
dividends, is of no importance, for, after all they refer to the same amounts received by
the deceased Benigno Goitia in the name and for the benefit of the plaintiffs. The
question to be decided is whether or not in this jurisdiction a greater sum may be
claimed before the court than was claimed before the committee. It should be noted that
according to the cases cited by the appellant on pages 12 and 13 of her brief, to wit,
Patrick vs. Howard, 47 Mich., 40; 10 N. W. 71. 72; Dayton vs. Dakin's Estate, 61 N. W.,
349; and Luizzi vs. Brandy's Estate, 113 N. W., 574; 140 Mich., 73; 12 Detroit Leg., 59,
the claims passed upon by the committee cannot be enlarged in the Circuit Court by
amendment. But counsel for the appellees draws our attention to the doctrines of the
Vermont Supreme Court (Maughan vs. Burns' Estate, 64 Vt., 316; 23 Atlantic, 583),
permitting an augmentative amendment to the claim filed with the committee.

In the Maughan case, supra, the court stated:

ROWELL, J. This is an appeal from the decision and report of the commissioners on the
estate of Michael Burns. Plaintiff presented her claim to the commissioners at $2,789.65.
The ad damnum in her declaration filed in the probate court was $3,500. In the country
court she recovered $3,813.49. Thereupon she moved for leave to amend her
declaration by raising the ad damnum to $4,000, which was granted, and she had
judgment for the amount of her recovery. The identical claim presented to the
commissioners was the claim tried above. The amount of plaintiff's recovery rested on
the quantum meruit. The jury found that she merited more than she estimated her claim
when she presented it to the commissioners. But such underestimate did not preclude
her from recovering more, if the testimony show her entitled to it, as presumably it did,
as more was found. The fact of such estimate was evidence against here deserving
more, as it was an implied admission that what she claimed was enough; but the
admission was not conclusive upon her, and did not prevent 527; Stowe vs. Bishop, 58
Vt., 498; 3 Atl. Rep., 494; Hard vs. Burton, 62 Vt., 314; 20 Atl. Rep., 269.)

It is conceded that in common-low actions the court has power to raise the ad damnum
at any time; but it is claimed that as the probate court is not a common-low court, but is
a court of special and limited jurisdiction, and has by statue original jurisdiction of
settlement of the estates of deceased person, the country court has no power to raise
the ad damnum of the declaration filed in the probate court. The county court has, by
statue, appellate jurisdiction of matters originally within the jurisdiction of the probate
court and in such appeals it sits as a higher court of probate, and its jurisdiction is coextensive with that of the probate court. It is not limited to the particular questions that
arose in the probate court in the matter appealed, but is expressly extended to matters
originally within the jurisdiction of that court. It is an appellate court for the rehearing
and the re-examination of matters not particular questions merely that have been
acted upon in the court below. (Adams vs. Adams, 21 Vt., 162) And these matters
embrace even those that rest in discretion. (Holmes vs. Holmes, 26 Vt., 536.) In Francis
vs. Lathrope, 2 Tyler, 372, the claimant was allowed, on terms, to file a declaration in the
country court, he having omitted to file one in the probate court as required by statute. It
was within the jurisdiction of the probate court to have allowed this amendment, and, as
the county court had all the jurisdiction of the probate court in this behalf, it also had
power to allow the amendment.

However this may be, in this jurisdiction there is a rule governing the question raised in
this assignment of error, namely, section 776 of the Code of Civil Procedure, as
construed in the cases of Zaragoza vs. Estate of De Viademonte (10 Phil., 23); Escuin vs.
Escuin (11 Phil., 332); and In re Estate of Santos (18 Phil., 403). This section provides:

SEC. 776. Upon the lodging of such appeal; with the clerk, the disputed claim shall stand
for trial in the same manner as any other action in the Court of First Instance, the
creditor being deemed to be the plaintiff, and the estate the defendant, and pleading as
in other actions shall be filed.

Just as in ordinary actions in which the pleadings may be amended, so in the instant
case, the original complaint for the same amounts claimed before the committee was
altered, increasing the amounts, and the amended complaint was approved by the court
and not objected to by the adverse party. The character of the action throughout is the
same. The action before the committee rested on the contention that as attorney-in-fact
for the plaintiffs with respect to the partnership "Tren de Aguadas," the late Benigno
Goitia had received dividends upon their shares which he failed to turn over to them; the
appeal to the Court of First Instance is founded on the same contention. When the claim
was filed with the committee, counsel for the plaintiffs merely made a calculation of the
amounts due, in view of the fact that he had not all the data from the plaintiffs, who live
in Spain; but after filing the complaint on appeal with the court of First Instance, he
discovered that his clients were entitled to larger sums, and was therefore compelled to
change the amount of the claims.

Considering the distance that separated the plaintiffs from their attorney-in-fact, the
deceased Benigno Goitia, and that the latter failed to supply them with data from 1915
until his death in 1926, it is natural that they had to resort to calculating the amounts
due them from the "Tren de Aguadas." To deny them the right to amend their complaint
in accordance with section 776, when they had secured more definite information as to
the amounts due them, would be an injustice, especially when it is taken into
consideration that this action arises from trust relations between the plaintiffs and the
late Benigno Goitia as their attorney-in-fact.

The first error is therefore overruled.

The allegation found in the second assignment of error that the plaintiffs are not in
reality interested parties in this case is untenable. It does not appear from the bill of
exceptions that the appellant demurred on the ground of misjoinder of parties, or alleged
such misjoinder in her answer. In accordance with section 93 of the Code of Civil
Procedure, the appellant has waived the right to raise any objection on the ground that
the plaintiffs are not the real parties in interest, or that they are not the owners of the
stock in question. (Broce vs. Broce, 4 Phil., 611; and Ortiz vs. Aramburo, 8 Phil., 98)

Furthermore it appears from Exhibits D, E, F, and G, that the late Benigno Goitia
recognized that those shares of the "Tren de Aguadas" really belonged to the plaintiffs.
And above all, Exhibit K-1, which is a copy of the balance sheet for May and June, 1926,
taken from the books of the partnership, clearly shows that Leonor Mendezona owned
180 shares, and Valentina Izaguirre, 72 shares. Therefore the appellant cannot now
contend that the plaintiffs are not the real interested parties.

In the third assignment of error it is argued that following section 676 of the Code of Civil
Procedure, the court below had no power to order the defendant to render an account of
dividends supposed to have been received by her deceased husband. We are of opinion
that the order of the court enjoining the appellant to render an account of all the
amounts collected by her aforesaid husband Benigno Goitia as representative and
attorney-in-fact of the plaintiffs, from 1915 until June, 1926, was made for the purpose of
giving her an opportunity of showing, if she could, just what amounts the deceased
Goitia received on account of the appellees' stock. There is no reversible error in this; for,
as the complaint demanded the return of amounts alleged to have been received by the
deceased attorney-in-fact represented by the appellant, it was quite in order to
determine whether such amounts were really received or not.

The fourth assignment of error relates to Exhibits A and B, being the appellees'
depositions made before the American consul at Bilbao, Spain, in accordance with
section 356 of the Code of Civil Procedure. Counsel for the appellant was notified of the
taking of these depositions, and he did not suggest any other interrogatory in addition to
the questions of the committee. When these depositions were read in court, the
defendant objected to their admission, invoking section 383, No. 7, of the Code of Civil
Procedure. Her objection referred mainly to the following questions:

1. Did Mr. Benigno Goitia render you an account of your partnership in the "Tren de
Aguadas?" Yes, until the year 1914.

2. From the year 1915, did Mr. Benigno Goitia send you any report or money on account
of profits upon your shares? He sent me nothing, nor did he answer, my letters.

3. did you ever ask him to send you a statement of your account Yes, several times by
letter, but I never received an answer.

The first of these questions tends to show the relationship between the principals and
their attorney-in-fact Benigno Goitia up to 1914. Supposing it was error to permit such a
question, it would not be reversible error, for that very relationship is proved by Exhibits
C to F, and H to I. As to the other two questions, it is to be noted that the deponents
deny having received from the deceased Benigno Goitia any money on account of profits
on their shares, since 1915. We are of opinion that the claimants' denial that a certain
fact occurred before the death of their attorney-in-fact Benigno Agoitia does not come
within the legal prohibitions (section 383, No. 7, Code of Civil Procedure). The law
prohibits a witness directly interested in a claim against the estate of a decedent from
testifying upon a matter of fact which took place before the death of the deceased. The
underlying principle of this prohibition is to protect the intestate estate from fictitious
claims. But this protection should not be treated as an absolute bar or prohibition from
the filing of just claims against the decedent's estate.

The facts in the case of Maxilom vs. Tabotabo (9 Phil., 390), differ from those in the case
at bar. In that case, the plaintiff Maxilom liquidated his accounts with the deceased
Tabotabo during his lifetime, with the result that there was a balance in his favor and
against Tabotabo of P312.37, Mexican currency. The liquidation was signed by both
Maxilom and Tabotabo. In spite of this, some years later, or in 1906, Maxilom filed a
claim against the estate of Tabotabo for P1,062.37, Mexican currency, alleging that P750
which included the 1899 liquidation had not really been received, and that therefore
instead of P312.37, Mexican currency, that liquidation should have shown a balance of
P1,062.37 in favor of Maxilom. It is evident that in view of the prohibition of section 383,
paragraph 7, of the Code of Civil Procedure, Maxilom could not testify in his own behalf
against Tabotabo's estate, so as to alter the balance of the liquidation made by and
between himself and the decedent. But in the case before us there has been no such
liquidation between the plaintiffs and the deceased Goitia. They testify, denying any
such liquidation. To apply to them the rule that "if death has sealed the lips of one of the
parties, the law seals those of the other," would be to exclude all possibility of a claim
against the testamentary estate. We do not believe that this was the legislator's
intention.

The plaintiffs-appellees did not testify to a fact which took place before their
representative's death, but on the contrary denied that it had taken place at all, i.e. they
denied that a liquidation had been made or any money remitted on account of their
shares in the "Tren de Aguadas" which is the ground of their claim. It was incumbent
upon the appellant to prove by proper evidence that the affirmative proposition was true,
either by bringing into court the books which the attorney-in-fact was in duty bound to
keep, or by introducing copies of the drafts kept by the banks which drew them, as was
the decedents's usual practice according to Exhibit I, or by other similar evidence.

The appellant admits having found a book of accounts kept by the decedent showing an
item of P90 for the account of Leonor Mendezona and another of P36 for the account of
Valentina Izaguirre, which agrees with the statement of Ruperto Santos, who succeeded
Benigno Goitia in the administration of said partnership, to the effect that the deceased
attorney-in-fact had collected the amounts due the plaintiffs as dividends on their shares
for the months of May and June, 1926, or P90 for Leonor Mendezona, and P36 for
Valentina Izaguirre, amounts which had not been remitted by the deceased to the
plaintiffs.

Finally, the appellant complains that the trial court held by mere inference that Benigno
Goitia received from the "Tren de Aguadas" the amounts of P13,140 and P5,265 for
Mendezona and Izaguirre, respectively, as dividends for the years from 1915 to 1926,
inclusive, and in holding again, by mere inference, that Benigno Goitia did not remit said
sums to the plaintiffs.

It is a well established fact in the record that the plaintiffs had an interest or some shares
in the partnership called "Tren de Aguadas," Mendezona holding 180 shares, worth
P18,000, and Izaguirre, 72 shares worth P7,200. By the testimony of Ruperto Santos,
former secretary of Benigno Goitia and his successor in the administration of that
partnership, it appears that the deceased Benigno Goitia had received the dividends due
the appellees for the months of May and June, 1926. And according to Exhibit K-I, the
dividend for the months of May and June was P0.50 a share. And witness Ramon Salinas,
a practising attorney and one of the shareholders of the partnership "Tren de Aguadas,"
testified, from a notebook which he had, that he received from the "Tren de Aguadas" the
following ordinary dividends: P45 in 1915; P45 in 1916; P45 in 1917; P45 in 1918; P45 in
1919; P90 in 1920; P67.50 in 1921, and P45 each for 1922, 1923, 4924, 1925, and 1926.
By way of extraordinary dividends, the witness testified that he received P22.50 each
year from 1915 to 1918 inclusive; P45 in 1919; P60 in 1920; P37.50 in 1921, 1922, 1923,
and 1924; P15 in 1925; and P22.50 in 1926. He further stated that he received P165 in
1918 as his share of the proceeds of the sale of the boat Santolan. Summing up all these
amounts, we find that the witness Ramon Salinas, from 1915 to 1925, received a total of
P1,087.50.

It further appears that Ruperto Santos assured the court that the dividends for the period
from 1915 to 1926 have been distributed among the shareholders, and that the late
Benigno Goitia received the dividends due on the shares pertaining to Leonor Mendezona
and Valentina Izaguirre, deducting them from the total distribution. In view of these data,
the court below reached the conclusion, on the basis of the dividends received by

partner Ramon Salinas, that the attorney-in-fact Benigno Goitia received for the
plaintiffs-appellees, respectively, the amounts of P13,140 and P5.256, including the
dividends for 1926, or P90 for Leonor Mendezona, and P36 for Valentina Izaguirre.

As to the interest imposed in the judgment appealed from, it is sufficient to cite article
1724 of the Civil Code, which provides that an agent shall be liable for interest upon any
sums he may have applied to his own use, from the day on which he did so, and upon
those which he still owes, after the expiration of the agency, from the time of his default.

The judgment appealed form being in accordance with the merits of the case, we are of
opinion, and so hold, that the same must be, as it is hereby, affirmed, with costs against
the appellant. So ordered.

Johnson, Malcolm, Ostrand, Johns, Romualdez and Villa-Real, JJ., concur.

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