RUIZ v. CA deposited with the Branch Clerk of Court.
Respondent Montes opposed and
G.R. No. 118671/JAN 29, 1996 / PUNO, J./Appeals in Special Proceedings Rules on
Advance Distribution/ECPPOTIAN
NATURE Petition for review on certiorari
PETITIONERS THE ESTATE OF HILARIO M. RUIZ, EDMOND RUIZ, Executor
RESPONDENTS CA (Former Special Sixth Division), MARIA PILAR RUIZ-MONTES,
MARIA CATHRYN RUIZ, CANDICE ALBERTINE RUIZ, MARIA ANGELINE RUIZ and THE
PRESIDING JUDGE OF THE RTC OF PASIG, BRANCH 156
SUMMARY. Hilario Ruiz will names as heirs: his only son Edmond (petitioner), his
adopted daughter, and his 3 granddaughters (private respondents). One of the
properties the decedent left was in Valle Verde IV which was leased out by Edmond
even though it was bequeathed in favor of the granddaughters. Probate Court
ordered that Edmond deposit the rentals. Thereafter, Edmond filed for the release of
the funds. Respondents filed their own motion praying for the release of the funds in
their favor. Probate court granted respondents motion, while also granted petitioner
some amount but only for the preservation and administration of the property. The
court, however, held in abeyance the release of the titles to respondent Montes and
the three granddaughters until the lapse of six months from the date of first
publication of the notice to creditors. SC held that no distribution shall be allowed
until the payment of the obligations has been made or provided for, unless the
distributees, or any of them, give a bond, in a sum to be fixed by the court,
conditioned for the payment of said obligations within such time as the court directs.
While Hilario died without debts, he was still liable for taxes. The estate tax is one of
those obligations that must be paid before distribution of the estate. At the time the
order was issued the properties of the estate had not yet been inventoried and
appraised.
DOCTRINE. In settlement of estate proceedings, the distribution of the estate
properties can only be made: (1) after all the debts, funeral charges, expenses of
administration, allowance to the widow, and estate tax have been paid; or (2) before
payment of said obligations only if the distributees or any of them gives a bond in a
sum fixed by the court conditioned upon the payment of said obligations within such
time as the court directs, or when provision is made to meet those obligations.
FACTS
Petitioner Edmond only son of decedent ; Respondents adopted
daughter and 3 granddaughters (children of Ruiz the petitioner)
Hilario M. Ruiz (decedent) executed a holographic will naming as his heirs
his only son, his adopted daughter and his three granddaughters. The
testator bequeathed to them cash, personal and real properties and named
Edmond Ruiz executor of his estate.
Hilario died. The cash component was thereafter distributed to his heirs.
For unknown reasons, the petitioner did not filed for the probate of his
dads will. 4 years after, Pilar (a respondent) filed with RTC a petition for the
probate of Hilarios will and issuance of letters testamentary for Edmond.
Surprisingly, Edmond opposed alleging it was executed under undue
influence (hahaha0
One of the properties in Valle Verde IV bequeathed to Edmonds children
was leased out by him to third persons. Thereafter, the probate court
ordered Edmond to deposit the value of the rentals less the expenses.
Edmond withdrew his opposition to the probate so the probate court
admitted the will to probate and issued letters testamentary to Edmond
upon his filing of the bond of 50k.
Petitioner Testate Estate of Hilario Ruiz as executor, filed an Ex-Parte Motion
for Release of Funds. It prayed for the release of the rent payments
prayed for the release of the said rent payments to Edmonds daughters.
Probate court: denied the release in favor of petitioner but granted
respondents motion in view of petitioners lack of opposition.
Edmond filed an MR. Petitioner after some time, through counsel,
manifested that he was withdrawing his motion for release of funds in view
of the fact that the lease contract over Valle Verde property had been
renewed for another year.
Despite petitioners manifestation, the probate court ordered the release of
the funds to Edmond but only such amount as may be necessary to cover
the expenses of administration and allowances for support of the testators
granddaughters subject to collation and deductible from their share in the
inheritance.
The court, however, held in abeyance the release of the titles to respondent
Montes and the three granddaughters until the lapse of six months from the
date of first publication of the notice to creditors.
CA: sustained the order of the probate court.
ISSUES & RATIO.
1. WON the probate court has the authority to grant an allowance from the
funds of the estate for the support of the testators grandchildren-- NO.
Section 3 of Rule 83 of the Revised Rules of Court provides:
Sec. 3. Allowance to widow and family. - The widow and minor or incapacitated
children of a deceased person, during the settlement of the estate, shall receive
therefrom under the direction of the court, such allowance as are provided by law.
Petitioner: this provision only gives the widow and the minor or incapacitated
children of the deceased the right to receive allowances for support during the
settlement of estate proceedings. He contends that the testators three
granddaughters do not qualify for an allowance because they are not incapacitated
and are no longer minors but of legal age, married and gainfully employed. Also,
grandchildren are excluded.
SC: allowances for support under Section 3 of Rule 83 should not be limited to the
minor or incapacitated children of the deceased. Article 188 of the CC, the
substantive law in force at the time of the testators death, provides that during the
liquidation of the conjugal partnership, the deceaseds legitimate spouse and
children, regardless of their age, civil status or gainful employment, are entitled to
provisional support from the funds of the estate.
Be that as it may, grandchildren are not entitled to provisional support from the
funds of the decedents estate. The law clearly limits the allowance to widow and
children and does not extend it to the deceaseds grandchildren, regardless of their
minority or incapacity. It was error for the appellate court to sustain the probate
courts order granting an allowance to the grandchildren of the testator pending
settlement of his estate.
2. [MAIN] WON probate court has the authority to order the release of the
titles to certain heirs -- NO
Respondent courts also erred when they ordered the release of the titles of the
bequeathed properties to private respondents six months after the date of first
publication of notice to creditors. An order releasing titles to properties of the
estate amounts to an advance distribution of the estate which is allowed
only under the following conditions:
Rule 109, Sec. 2. Advance distribution in special proceedings. - Notwithstanding a
pending controversy or appeal in proceedings to settle the estate of a decedent, the
court may, in its discretion and upon such terms as it may deem proper and just,
permit that such part of the estate as may not be affected by the controversy or
appeal be distributed among the heirs or legatees, upon compliance with the
conditions set forth in Rule 90 of these Rules.
And Rule 90 provides that:
Sec. 1. When order for distribution of residue made. - When the debts, funeral
charges, and expenses of administration, the allowance to the widow, and
inheritance tax, if any, chargeable to the estate in accordance with law, have been
paid, the court, on the application of the executor or administrator, or of a person
interested in the estate, and after hearing upon notice, shall assign the residue of
the estate to the persons entitled to the same, naming them and the proportions, or
parts, to which each is entitled, and such persons may demand and recover their
respective shares from the executor or administrator, or any other person having the
same in his possession. If there is a controversy before the court as to who are the
lawful heirs of the deceased person or as to the distributive shares to which each
person is entitled under the law, the controversy shall be heard and decided as in
ordinary cases.
No distribution shall be allowed until the payment of the obligations
above-mentioned has been made or provided for, unless the distributees,
or any of them, give a bond, in a sum to be fixed by the court, conditioned
for the payment of said obligations within such time as the court directs.
In settlement of estate proceedings, the distribution of the estate
properties can only be made: (1) after all the debts, funeral charges,
expenses of administration, allowance to the widow, and estate tax have
been paid; or (2) before payment of said obligations only if the
distributees or any of them gives a bond in a sum fixed by the court
conditioned upon the payment of said obligations within such time as the
court directs, or when provision is made to meet those obligations.
As applied: the probate court ordered the release of the titles after the lapse of six
months from the date of first publication of the notice to creditors. Though Hilario
allegedly had no debts when he died, he was still liable to estate tax. The estate tax
is one of those obligations that must be paid before distribution of the estate. If not
yet paid, the rule requires that the distributees post a bond or make such provisions
as to meet the said tax obligation in proportion to their respective shares in the
inheritance. At the time the order was issued the properties of the estate had not yet
been inventoried and appraised.
3. WON probate court has the authority to grant possession of all properties of
the estate to the executor of the will.-- NO
Still and all, petitioner cannot correctly claim that the assailed order deprived him of
his right to take possession of all the real and personal properties of the estate. The
right of an executor or administrator to the possession and management
of the real and personal properties of the deceased is not absolute and can
only be exercised so long as it is necessary for the payment of the debts
and expenses of administration
When petitioner moved for further release of the funds deposited with the clerk of
court, he had been previously granted by the probate court certain amounts for
repair and maintenance expenses on the properties of the estate, and payment of
the real estate taxes thereon. But petitioner moved again for the release of
additional funds for the same reasons he previously cited. It was correct for the
probate court to require him to submit an accounting of the necessary expenses for
administration before releasing any further money in his favor.
Petitioner must be reminded that his right of ownership over the properties of his
father is merely inchoate as long as the estate has not been fully settled and
partitioned. As executor, he is a mere trustee of his fathers estate.
DECISION. CA affirmed with modification.