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G.R. No.

16680 September 13, 1920

BROADWELL HAGANS, petitioner,


vs.
ADOLPH WISLIZENUS, Judge of First Instance of Cebu, ET AL., respondents.

Block, Johnston & Greenbaum for petitioner.


The respondent judge in his own behalf.
No appearance for the other respondents.

JOHNSON, J.: In view of the interpretation given to the words "action" and "special proceeding" by
the Legislature itself, we are driven to the conclusion that there is a distinction
between an "action" and a "special proceeding," and that when the Legislature used
This is an original petition, presented in the Supreme Court, for writ of certiorari. The
the word "action" it did not mean "special proceeding."
facts alleged in the petition are admitted by a demurrer. The only question presented
is, whether or not a judge of the Court of First Instance, in "special proceedings," is
authorized under the law to appoint assessors for the purpose of fixing the amount There is a marked distinction between an "action" and a "special proceeding. "An
due to an administrator or executor for his services and expenses in the care, action is a formal demand of one's legal rights in a court of justice in the manner
management, and settlement of the estate of a deceased person. prescribed by the court or by the law. It is the method of applying legal remedies
according to definite established rules. (People vs. County Judge, 13 How. Pr. [N. Y.],
398.) The term "special proceeding" may be defined as an application or proceeding
The respondent judge, in support of his demurrer, argues that the provision of Act No.
to establish the status or right of a party, or a particular fact. (Porter vs. Purdy, 29 N.
190 permit him to appoint assessors in "special proceedings," The petitioner contends
Y., 106, 110; Chapin vs. Thompson, 20 Cal., 681.) Usually, in special proceedings, no
that no authority in law exists for the appointment of assessors in such proceedings.
formal pleadings are required, unless the statute expressly so provides. The remedy in
special proceedings is generally granted upon an application or motion. Illustrations of
The only provisions of law which authorize the appointment of assessors are the special proceedings, in contradistinction to actions, may be given: Proceedings for the
following; (a) Section 57-62 of Act No. 190; (b) sections 153-161 of Act No. 190; (c) appointment of an administrator, guardians, tutors; contest of wills; to perpetuate
section 44 (a) of Act No. 267; (d) section 2477 of Act No. 2711; and (e) section 2 of Act testimony; to change the name of persons; application for admission to the bar, etc.,
No. 2369. etc. (Bliss on Code Pleading, 3d ed., sec. 1.)

Said section 44 (a) of Act No. 267 and section 2477 of Act No. 2711 apply to the city of From all of the foregoing we are driven to the conclusion that in proceedings like the
Manila only. Act No. 2369 provides for the appointment of assessors in criminal cases present the judge of the Court of First Instance is without authority to appoint
only. Sections 57-62 of Act No. 190 provide for the appointment of assessors in the assessors. Therefore, the demurrer is hereby overruled and the prayer of the petition
court of justice of the peace. Therefore, the only provisions of law which could, by any is hereby granted, and it is hereby ordered and decreed that the order of the
possibility, permit the appointment of assessors in "special proceedings" are sections respondent judge appointing the assessors described in the petition be and the same
153-161 of Act No. 190. is hereby annulled and set aside; and, without any finding as to costs, it is so ordered.

Section 154 provides that "either party to an action may apply in writing to the judge
for assessors to sit in the trial. Upon the filing of such application, the judge shall direct
that assessors be provided, . . . ."

Is a "special proceeding," like the present, an "action"? If it is, then, the court is
expressly authorized by said section 154 to appoint assessors. But we find, upon an
examination of section 1 of Act No. 190, which gives us an interpretation of the words
used in said Act, that a distinction is made between an "action" and a "special
proceeding." Said section 1 provides that an "action" means an ordinary suit in a court
of justice, while "every other remedy furnished by law is a 'special proceeding."
G.R. No. 109373 March 20, 1995 On May 17, 1991, a new Liquidator, Vitaliano N. Nañagas, 4 President of the Philippine
Deposit Insurance Corporation (PDIC), was appointed by the Central Bank.
PACIFIC BANKING CORPORATION EMPLOYEES ORGANIZATION, PAULA S.
PAUG, and its officers and members, petitioners, On March 13, 1989 the Pacific Banking Corporation Employees Organization (Union
vs. for short), petitioner in G.R. No. 109373, filed a complaint-in-intervention seeking
THE HONORABLE COURT OF APPEALS and VITALIANO N. NAÑAGAS II, as payment of holiday pay, 13th month pay differential, salary increase differential,
Liquidator of Pacific Banking Corporation, respondents. Christmas bonus, and cash equivalent of Sick Leave Benefit due its members as
employees of PaBC. In its order dated September 13, 1991, the trial court ordered
payment of the principal claims of the Union.5
G.R. No. 112991 March 20, 1995

The Liquidator received a copy of the order on September 16, 1991. On October 16,
THE PRESIDENT OF THE PHILIPPINE DEPOSIT INSURANCE CORPORATION, as
1991, he filed a Motion for Reconsideration and Clarification of the order. In his order
Liquidator of the Pacific Banking Corporation , petitioner,
of December 6, 1991, the judge modified his September 13, 1991 6 but in effect denied
vs.
the Liquidator's motion for reconsideration. This order was received by the Liquidator
COURT OF APPEALS, HON. JUDGE REGINO T. VERIDIANO II, DEPUTY SHERIFF
on December 9, 1991. The following day, December 10, 1991, he filed a Notice of
RAMON ENRIQUEZ and ANG ENG JOO, ANG KEONG LAN and E.J ANG INT'L.
Appeal and a Motion for Additional Time to Submit Record on Appeal. On December
LTD., represented by their Attorney-in-fact, GONZALO C. SY, respondents.
23, 1991, another Notice of Appeal was filed by the Office of the Solicitor General in
behalf of Nañagas.

In his order of February 10, 1992, respondent judge disallowed the Liquidator's Notice
MENDOZA, J.: of Appeal on the ground that it was late, i.e., more than 15 days after receipt of the
decision. The judge declared his September 13, 1991 order and subsequent orders to
be final and executory and denied reconsideration. On March 27, 1992, he granted
These cases have been consolidated because the principal question involved is the the Union's Motion for issuance of a writ of Execution.
same: whether a petition for liquidation under §29 of Rep. Act No. 265, otherwise
known as the Central Bank Act, is a special proceeding or an ordinary civil action. The
Fifth and the Fourteenth Divisions of the Court of Appeals reached opposite results on Ang Keong Lan and E.J. Ang Int'l., private respondents in G.R. No. 112991, likewise
this question and consequently applied different periods for appealing. filed claims for the payment of investment in the PaBC allegedly in the form of shares
of stocks amounting to US$2,531,632.18. The shares of stocks, consisting of 154,462
common shares, constituted 11% of the total subscribed capital stock of the PaBC.
The facts are as follows: They alleged that their claim constituted foreign exchange capital investment entitled
to preference in payment under the Foreign Investments Law.
I.
In his order dated September 11, 1992, respondent judge of the RTC directed the
Proceedings in the CB and the RTC Liquidator to pay private respondents the total amount of their claim as preferred
creditors.7
On July 5, 1985, the Pacific Banking Corporation (PaBC) was placed under
receivership by the Central Bank of the Philippines pursuant to Resolution No. 699 of The Liquidator received the order on September 16, 1992. On September 30, 1992 he
its Monetary Board. A few months later, it was placed under liquidation 1 and a moved for reconsideration, but his motion was denied by the court on October 2,
Liquidator was appointed.2 1992. He received the order denying his Motion for Reconsideration on October 5,
1992. On October 14, 1992 he filed a Notice of Appeal from the orders of September
16, 1992 and October 2, 1992. As in the case of the Union, however, the judge
On April 7, 1986, the Central Bank filed with the Regional Trial Court of Manila Branch ordered the Notice of Appeal stricken off the record on the ground that it had been
31, a petition entitled "Petition for Assistance in the Liquidation of Pacific Banking filed without authority of the Central Bank and beyond 15 days. In his order of October
Corporation." 3 The petition was approved, after which creditors filed their claims with 28, 1992, the judge directed the execution of his September 11, 1992 order granting
the court. the Stockholders/ Investors' claim.

II.
Proceedings in the Court of Appeals 4. The Court of Appeals erred seriously in concluding that the
notice of appeal filed by Nañagas was filed on time.
The Liquidator filed separate Petitions for Certiorari, Prohibition and Mandamus in the
Court of Appeals to set aside the orders of the trial court denying his appeal from the 5. The Court of Appeals erred seriously in declaring that the
orders granting the claims of Union and of the Stockholders/Investors. The two second notice of appeal filed on December 23, 1991 by the
Divisions of the Court of Appeals, to which the cases were separately raffled, rendered Solicitor General is a superfluity.
conflicting rulings.
On the other hand, in G.R. No. 112991 the Liquidator contends that:
In its decision of November 17, 1992 in CA-G.R. SP No. 27751 (now G.R. No. 09373)
the Fifth Division8 held in the case of the Union that the proceeding before the trial
1. The Petition for Assistance in the Liquidation of the Pacific
court was a special proceeding and, therefore, the period for appealing from any
Banking Corporation s a Special Proceeding case and/or one
decision or final order rendered therein is 30 days. Since the notice of appeal of the
which allows multiple appeals, in which case the period of appeal
Liquidator was filed on the 30th day of his receipt of the decision granting the Union's
is 30 days and not 15 days from receipt of the order/judgment
claims, the appeal was brought on time. The Fifth Division, therefore, set aside the
appealed from.
orders of the lower court and directed the latter to give due course to the appeal of the
Liquidator and set the Record on Appeal he had filed for hearing.
2. Private respondents are not creditors of PaBC but are plain
stockholders whose right to receive payment as such would
On the other hand, on December 16, 1993, the Fourteenth Division 9 ruled in CA-G.R.
accrue only after all the creditors of the insolvent bank have been
SP No. 29351 (now G.R. No. 112991) in the case of the Stockholders/Investors that a
paid.
liquidation proceeding is an ordinary action. Therefore, the period for appealing from
any decision or final order rendered therein is 15 days and that since the Liquidator's
appeal notice was filed on the 23rd day of his receipt of the order appealed from, 3. The claim of private respondents in the amount of
deducting the period during which his motion for reconsideration was pending, the US$22,531,632.18 is not in the nature of foreign investment as it
notice of appeal was filed late. Accordingly, the Fourteenth Division dismissed the is understood in law.
Liquidator's petition.
4. The claim of private respondents has not been clearly
III. established and proved.

Present Proceedings 5. The issuance of a writ of execution against the assets of PaBC
was made with grave abuse of discretion.
The Union and the Liquidator then separately filed petitions before this Court.
The petitions in these cases must be dismissed.
In G.R. No. 109373 the Union contends that:
First. As stated in the beginning, the principal question in these cases is whether a
petition for liquidation under §29 of Rep. Act No. 265 is in the nature of a special
1. The Court of Appeals acted without jurisdiction over the subject
proceeding. If it is, then the period of appeal is 30 days and the party appealing must,
matter or nature of the suit.
in addition to a notice of appeal, file with the trial court a record on appeal in order to
perfect his appeal. Otherwise, if a liquidation proceeding is an ordinary action, the
2. The Court of Appeals gravely erred in taking cognizance of the period of appeal is 15 days from notice of the decision or final order appealed from.
petition for certiorari filed by Nañagas who was without any legal
authority to file it.
BP Blg. 129 provides:

3. The Court of Appeals erred in concluding that the case is a


§39. Appeals. — The period for appeal from final orders,
special proceeding governed by Rules 72 to 109 of the Revised
resolutions, awards, judgments, or decisions of any court in all
Rules of Court.
cases shall be fifteen (15) days counted from the notice of the
final order, resolution, award, judgment or decision appealed
from: Provided, however, that in habeas corpus cases the period to supplement the provisions of the rule relating to such civil
for appeal shall be forty-eight (48) hours from the notice of the actions are applicable to special civil actions. This embraces Rule
judgment appealed from. 41 covering appeals from the regional trial court to the Court of
Appeals.
No record on appeal shall be required to take an appeal. In lieu
thereof, the entire record shall be transmitted with all the pages xxx xxx xxx
prominently numbered consecutively, together with an index of
the contents thereof.
Thus, under Section 1 Rule 2 of the Rules of Court, an action is
defined as "an ordinary suit in a court of justice by which one
This section shall not apply in appeals in special proceedings and party prosecutes another for the enforcement or protection of a
in other cases wherein multiple appeals are allowed under right or the prevention or redress of a wrong." On the other hand,
applicable provisions of the Rules of Court. Section 2 of the same Rule states that "every other remedy
including one to establish the status or right of a party or a
particular fact shall be by special proceeding."
The Interim Rules and Guidelines to implement BP Blg. 129 provides:

To our mind, from the aforequoted definitions of an action and a


19. Period of Appeals. —
special proceeding, the petition for assistance of the court in the
liquidation of an asset of a bank is not "one to establish the status
(a) All appeals, except in habeas or right of a party or a particular fact." Contrary to the submission
corpus cases and in the cases referred to in of the petitioner, the petition is not intended to establish the fact of
paragraph (b) hereof, must be taken within insolvency of the bank. The insolvency of the bank had already
fifteen (15) days from notice of the judgment, been previously determined by the Central Bank in accordance
order, resolution or award appealed from. with Section 9 of the CB Act before the petition was filed. All that
needs to be done is to liquidate the assets of the bank and thus
the assistance of the respondent court is sought for that purpose.
(b) In appeals in special proceedings in
accordance with Rule 109 of the Rules of
Court and other cases wherein multiple It should be pointed out that this petition filed is not among the
appeals are allowed, the period of appeals cases categorized as a special proceeding under Section 1, Rule
shall be thirty (30) days, a record on appeal 72 of the Rules of Court, nor among the special proceedings that
being required. may be appealed under Section 1, Rule 109 of the Rules.

The Fourteenth Division of the Court of Appeals held that the proceeding is an We disagree with the foregoing view of the Fourteenth Division. Rule 2 of the Rules of
ordinary action similar to an action for interpleader under Rule 63. 10 The Fourteenth Court provide:
Division stated:
§1. Action defined. — Action means an ordinary suit in a court of
The petition filed is akin to an interpleader under Rule 63 of the justice, by which the party prosecutes another for the enforcement
Rules of Court where there are conflicting claimants or several or protection of a right, or the prevention or redress of a wrong.
claims upon the same subject matter, a person who claims no
interest thereon may file an action for interpleader to compel the
§2. Special Proceeding Distinguished. — Every other remedy,
claimants to "interplead" and litigate their several claims among
including one to establish the status or right of a party or a
themselves. (Section I Rule 63).
particular fact, shall be by special proceeding.

An interpleader is in the category of a special civil action under


Elucidating the crucial distinction between an ordinary action and a special
Rule 62 which, like an ordinary action, may be appealed only
proceeding, Chief Justice Moran states:" 11
within fifteen (15) days from notice of the judgment or order
appealed from. Under Rule 62, the preceding rules covering
ordinary civil actions which are not inconsistent with or may serve
Action is the act by which one sues another in a court of justice A liquidation proceeding is a single proceeding which consists of a
for the enforcement or protection of a right, or the prevention or number of cases properly classified as "claims." It is basically a
redress of a wrong while special proceeding is the act by which two-phased proceeding. The first phase is concerned with the
one seeks to establish the status or right of a party, or a particular approval and disapproval of claims. Upon the approval of the
fact. Hence, action is distinguished from special proceeding in petition seeking the assistance of the proper court in the
that the former is a formal demand of a right by one against liquidation of a close entity, all money claims against the bank are
another, while the latter is but a petition for a declaration of a required to be filed with the liquidation court. This phase may end
status, right or fact. Where a party litigant seeks to recover with the declaration by the liquidation court that the claim is not
property from another, his remedy is to file an action. Where his proper or without basis. On the other hand, it may also end with
purpose is to seek the appointment of a guardian for an insane, the liquidation court allowing the claim. In the latter case, the
his remedy is a special proceeding to establish the fact or status claim shall be classified whether it is ordinary or preferred, and
of insanity calling for an appointment of guardianship. thereafter included Liquidator. In either case, the order allowing or
disallowing a particular claim is final order, and may be appealed
by the party aggrieved thereby.
Considering this distinction, a petition for liquidation of an insolvent corporation should
be classified a special proceeding and not an ordinary action. Such petition does not
seek the enforcement or protection of a right nor the prevention or redress of a wrong The second phase involves the approval by the Court of the
against a party. It does not pray for affirmative relief for injury arising from a party's distribution plan prepared by the duly appointed liquidator. The
wrongful act or omission nor state a cause of action that can be enforced against any distribution plan specifies in detail the total amount available for
person. distribution to creditors whose claim were earlier allowed. The
Order finally disposes of the issue of how much property is
available for disposal. Moreover, it ushers in the final phase of the
What it seeks is merely a declaration by the trial court of the corporation's insolvency
liquidation proceeding — payment of all allowed claims in
so that its creditors may be able to file their claims in the settlement of the
accordance with the order of legal priority and the approved
corporation's debts and obligations. Put in another way, the petition only seeks a
distribution plan.
declaration of the corporation's debts and obligations. Put in another way, the petition
only seeks a declaration of the corporation's state of insolvency and the concomitant
right of creditors and the order of payment of their claims in the disposition of the Verily, the import of the final character of an Order of allowance or
corporation's assets. disallowance of a particular claim cannot be overemphasized. It is
the operative fact that constitutes a liquidation proceeding a "case
where multiple appeals are allowed by law." The issuance of an
Contrary to the rulings of the Fourteenth Division, liquidation proceedings do not
Order which, by its nature, affects only the particular claims
resemble petitions for interpleader. For one, an action for interpleader involves claims
involved, and which may assume finality if no appeal is made
on a subject matter against a person who has no interest therein. 12 This is not the
therefrom, ipso factocreates a situation where multiple appeals
case in a liquidation proceeding where the Liquidator, as representative of the
are allowed.
corporation, takes charge of its assets and liabilities for the benefit of the
creditors.13 He is thus charged with insuring that the assets of the corporation are paid
only to rightful claimants and in the order of payment provided by law. A liquidation proceeding is commenced by the filing of a single
petition by the Solicitor General with a court of competent
jurisdiction entitled, "Petition for Assistance in the Liquidation
Rather, a liquidation proceeding resembles the proceeding for the settlement of state
of e.g., Pacific Banking Corporation. All claims against the
of deceased persons under Rules 73 to 91 of the Rules of Court. The two have a
insolvent are required to be filed with the liquidation court.
common purpose: the determination of all the assets and the payment of all the debts
Although the claims are litigated in the same proceeding, the
and liabilities of the insolvent corporation or the estate. The Liquidator and the
treatment is individual. Each claim is heard separately. And the
administrator or executor are both charged with the assets for the benefit of the
Order issued relative to a particular claim applies only to said
claimants. In both instances, the liability of the corporation and the estate is not
claim, leaving the other claims unaffected, as each claim is
disputed. The court's concern is with the declaration of creditors and their rights and
considered separate and distinct from the others. Obviously, in
the determination of their order of payment.
the event that an appeal from an Order allowing or disallowing a
particular claim is made, only said claim is affected, leaving the
Furthermore, as in the settlement of estates, multiple appeals are allowed in others to proceed with their ordinary course. In such case, the
proceedings for liquidation of an insolvent corporation. As the Fifth Division of the original records of the proceeding are not elevated to the
Court of Appeals, quoting the Liquidator, correctly noted: appellate court. They remain with the liquidation court. In lieu of
the original record, a record of appeal is instead required to be The Union's contention is untenable. In liquidation proceedings, the function of the trial
prepared and transmitted to the appellate court. court is not limited to assisting in the implementation of the orders of the Monetary
Board. Under the same section (§29) of the law invoked by the Union, the court has
authority to set aside the decision of the Monetary Board "if there is a convincing proof
Inevitably, multiple appeals are allowed in liquidation proceedings.
that the action is plainly arbitrary and made in bad faith." 14 As this Court held in Rural
Consequently, a record on appeal is necessary in each and every
Bank of Buhi, Inc. v. Court of Appeals: 15
appeal made. Hence, the period to appeal therefrom should be
thirty (30) days, a record on appeal being required. (Record pp.
162-164). There is no question, that the action of the monetary Board in this
regard may be subject to judicial review. Thus, it has been held
that the Court's may interfere with the Central Bank's exercise of
In G.R. No. 112991 (the case of the Stockholders/Investors), the Liquidator's notice of
discretion in determining whether or not a distressed bank shall
appeal was filed on time, having been filed on the 23rd day of receipt of the order
be supported or liquidated. Discretion has its limits and has never
granting the claims of the Stockholders/Investors. However, the Liquidator did not file
been held to include arbitrariness, discrimination or bad faith
a record on appeal with the result that he failed to perfect his appeal. As already
(Ramos v. Central Bank of the Philippines, 41 SCRA 567 [1971]).
stated a record on appeal is required under the Interim Rules and Guidelines in
special proceedings and for cases where multiple appeals are allowed. The reason for
this is that the several claims are actually separate ones and a decision or final order In truth, the Liquidator is the representative not only of the Central Bank but also of the
with respect to any claim can be appealed. Necessarily the original record on appeal insolvent bank. Under §§28A-29 of Rep. Act No. 265 he acts in behalf of the bank
must remain in the trial court where other claims may still be pending. "personally or through counsel as he may retain, in all actions or proceedings or
against the corporation" and he has authority "to do whatever may be necessary for
these purposes." This authority includes the power to appeal from the decisions or
Because of the Liquidator's failure to perfect his appeal, the order granting the claims
final orders of the court which he believes to be contrary to the interest of the bank.
of the Stockholders/Investors became final. Consequently. the Fourteenth Division's
decision dismissing the Liquidator's Petition for Certiorari,Prohibition
and Mandamus must be affirmed albeit for a different reason. Finally the Union contends that the notice of appeal and motion for extension of time
to file the record on appeal filed in behalf of the Central Bank was not filed by the
office of the Solicitor General as counsel for the Central Bank. This contention has no
On the other hand, in G.R. No. 109373 (case of the Labor Union), we find that the
merit. On October 22, 1992, as Assistant Solicitor General Cecilio O. Estoesta
Fifth Division correctly granted the Liquidator's Petition for Certiorari. Prohibition
informed the trial court in March 27, 1992, the OSG had previously authorized lawyers
and Mandamus. As already noted, the Liquidator filed a notice of appeal and a motion
of the PDIC to prepare and sign pleadings in the case. 16 Conformably thereto the
for extension to file a record on appeal on December 10, 1991, i.e., within 30 days of
Notice of Appeal and the Motion for Additional Time to submit Record on Appeal filed
his receipt of the order granting the Union's claim. Without waiting for the resolution of
were jointly signed by Solicitor Reynaldo I. Saludares in behalf of the OSG and by
his motion for extension, he filed on December 20, 1991 within the extension sought a
lawyers of the PDIC. 17
record on appeal. Respondent judge thus erred in disallowing the notice on appeal
and denying the Liquidator's motion for extension to file a record on appeal.
WHEREFORE, in G.R. No. 109373 and G.R. No 112991, the decisions appealed from
are AFFIRMED.
The Fifth Division of the Court of Appeals correctly granted the Liquidator's Petition
for Certiorari, Prohibition and Mandamus and its decision should, therefore, be
affirmed. SO ORDERED.

Second. In G.R. No. 109373, The Union claims that under §29 of Rep. Act No. 265,
the court merely assists in adjudicating the claims of creditors, preserves the assets of
the institution, and implements the liquidation plan approved by the Monetary Board
and that, therefore, as representative of the Monetary Board, the Liquidator cannot
question the order of the court or appeal from it. It contends that since the Monetary
Board had previously admitted PaBC's liability to the laborers by in fact setting aside
the amount of P112,234,292.44 for the payment of their claims, there was nothing else
for the Liquidator to do except to comply with the order of the court.
G.R. No. 26751 January 31, 1969 2. That his competence to act as administrator has been established to the
satisfaction of this Honorable Court as evidenced by his appointment by
a fixed, final and executory order dated May 29, 1963; and Carlos S. Matute
JOSE S. MATUTE, petitioner,
is now estopped from denying his [Matias S. Matute's] competence and
vs.
qualification by reason of his failure to object to the appointment of herein
THE COURT OF APPEALS (Third Division) and MATIAS S. MATUTE, respondents.
Judicial Administrator at the time the application was made therefor;

The present three petitions for certiorari with preliminary injunction (L-26571, L-
3. .... The records of the pertinent case in the Court of First Instance
26085 and L-26106) were separately interposed within the short span of five months
ofDavao will easily discover that the "criminal charge" supported by
by Jose S. Matute, one of the fifteen heirs to the Amadeo Matute Olave estate.
perjuredtestimony is nothing but a trumped-up affair initiated by persons
Because these petitions are intertwined in several material aspects and arose from a
intent onintimidating the herein Judicial Administrator into betraying his
common environmental setting — the intra-fraternal strife among the Matute heirs
sworn dutyto protect and safeguard the interest of the Estate. The records
which has unduly delayed for more than a decade the settlement of the Matute estate
of the saidcase will also reveal that it has not occupied any time at all of the
— this Court has decided to embody in a single decision the independently discussed
herein Judicial Administrator, for aside from a single hearing last December
resolutions of the issues raised in the said petitions.
1964 onhis application for bail ... no hearing has been held on the said case
up tothe present.
L-26751
Subsequently, Matias filed a memorandum dated September 12, 1965 in support of
Although the petition in L-26751 was filed the latest (October 27, 1966), we shall his foregoing opposition.
dispose of it first because our pronouncements and observations in this case have
direct and concrete relevance to the other two.
On September 21, 1965 the heirs of Agustina Matute Candelario, Elena
MatuteCandelario and Amadeo Matute Candelario and their mother and legatee
The antecedent events trace their origin to August 20, 1965 when Carlos S. Matute, AnunciacionCandelario, moved for the immediate appointment of Agustina Matute
one of the Matute heirs and a full-blood brother of both the petitioner and the herein Candelario,Carlos S. Matute and Jose S. Matute, herein petitioner, as joint co-
respondent Matias S. Matute, filed in special proceeding 25876 (settlement of the administratorsor anyone of them in place of Matias S. Matute, whose removal they
Matute estate) a petition praying for the removal of Matias as co-administrator and his also soughttogether with the ouster of the general administrator Carlos V. Matute, on
(Carlos') appointment in such capacity. Carlos alleged that "for a period of more than thefollowing additional grounds:
two years from the date of his appointment (on May 29, 1963), said Matias S. Matute
has neglected to render a true, just and complete account of his administration," and
1. Despite the vast resources and income of the estate, the present
that he "is not only incompetent but also negligent in his management of the estate
administrators have failed to pay even the annual real property tax for the
under his charge consisting of five haciendas on account of a criminal charge for
years 1964 and 1965;
murder filed against him which is occupying most of his time."1awphil.ñêt

2. The financial statements of both administrators were not properly signed


The respondent Matias claims that he forthwith interposed an opposition to the
andauthenticated by a certified public accountant, and do not contain the
aforesaid petition, and the record discloses that he later filed an amended opposition
exactentries as filed by former administrators containing the daily and
dated August 25, 1965 wherein he contended.
monthly entriesof receipts and disbursements;

1. That the allegation ... that the herein co-administrator for the two years of
3. Both administrators have deliberately failed to file their inventories
his administration, 1963 and 1964, did not render any accounting is
andstatements of accounts of time, and did so only when ordered by the
completely without basis and false, because the records show that under
probatecourt;
date of May 20,1964, he submitted to this Honorable Court with copies
furnished to all the parties concerned, including Carlos S. Matute, his
accounting for 1963, that on Feb. 8, 1965, he filed his accounting for 1964, 4. Both administrators have made unauthorized disbursements as shown by
which accounts for 1963 and 1964 have been approved by majority of the theirfinancial statements; and
heirs composing of 63% interests in the estate as shown by the attached
manifestation....
5. The probate court has discretion to remove the administrator.
It appears that during the reception of evidence conducted on December 29, 1965by Despite repeated urgent motions filed by Jose S. Matute praying that the Courtof
the probate court (Branch IV of the Court of First Instance of Manila withHonorable Appeals resolve with dispatch the issue of jurisdiction, the said appelatetribunal
Emigdio Nietes as the then presiding judge), Carlos S. Matute and theCandelario- instead required then respondent Jose S. Matute to answer, which he did.However, on
Matute heirs submitted respective lists of exhibits in support oftheir motion to oust October 27, 1966 herein petitioner Jose S. Matute interposed theinstant petition
Matias. On January 8, 1966 Matias filed a written objectionto the admission of the for certiorari with preliminary injunction against the Court of Appeals and Matias
movants' exhibits on the ground that the same were hearsay,self-serving, irrelevant Matute, challenging the jurisdiction of the respondentCourt of Appeals upon two basic
and/or mere photostatic copies of supposed originalswhich were never properly contentions:
identified nor shown in court. Four days later, or onJanuary 12, 1966, the counsel for
Matias filed with leave of court a "Motion toDismiss and/or Demurrer to Evidence"
The Court of Appeals has no jurisdiction to entertain, give due course,
which avers that "there is no sufficientevidence on record to justify and support the
andmuch more to issue a writ of preliminary injunction, against the
motions for the removal of theherein co-administrator Matias S. Matute." In the same
petitioner, Jose S. Matute, and respondent Judge Emigdio Nietes in CA-
motion, said counselreserved the right to introduce evidence in behalf of his client
G.R. No. 37039-R ... because the estate of Amadeo Matute Olave is worth
should theforegoing motion be denied.
more than P200,000.00; and

On January 31, 1966 the probate court issued an order, the dispositive portionof
The same Court of Appeals in CA-G.R. No. 35124-R, on January 27, 1965,
which reads:
specialfourth division, has ruled that the Court of Appeals has no jurisdiction
on theestate of Amadeo Matute Olave in the matter of the appointment and
FOR ALL THE FOREGOING, the Court hereby removes co-administrator, removal ofits administrators.
Matias S.Matute, as such co-administrator of the estate and orders him to
submit a finalaccounting of his administration together with his past
The respondent Matias Matute does not controvert the petitioner's claim that
administration accountswhich have not been approved, and, in his stead
thevalue of the estate of their deceased father exceeds P200,000. He
appoints Jose S. Matute, a brother by the same mother of Matias S. Matute,
maintains,however, that the respondent Court of Appeals has jurisdiction over CA-
as co-administrator, who ishereby required to put up a bond of P15,000.00,
G.R.37039-R "because the subject matter involved is merely ... the right to collectthe
and thereafter immediatelyqualify in his commission and assume the
(monthly) rentals due the Estate in the sum of P5,000.00" pursuant to acontract of
responsibility of co-administrator....
lease which he executed in favor of one Mariano Nasser coveringfive haciendas of the
estate under his separate administration.
Forthwith, Matias interposed with the Court of Appeals a petition for certiorari with
preliminary mandatory injunction (CA-G.R. 37039-R) dated February 1, 1966, praying
The foregoing assertion does not merit credence. A searching review of the record —
that the aforesaid order of January 31, 1966 be set aside as a nullityfor having
from the initial petition filed by Carlos Matute to oust the respondentas co-
decreed his removal without due process and the appointment of JoseS. Matute
administrator up to the latter's petition for certiorari filed with theCourt of Appeals
without the requisite hearing.
impugning the validity of the abovementioned order of January31, 1966 which
removed him as co-administrator and appointed the petitioner inhis place — reveals
On March 4, 1966 the Court of Appeals gave due course to the aforesaid petitionand no single pleading, statement, contention, reference or eveninference which would
resolved to grant a writ of preliminary injunction against Jose S. Matuteand the justify the respondent's pretension that the instantcontroversy is a mere contest over
Honorable Judge Emigdio Nietes, respondents in CA-G.R. 37039-R, conditioned on the right to collect a P5,000 rental. In bold contrast, the record vividly chronicles the
the filing of a P1,000 bond by the therein petitioner Matias, the respondentherein. On controversy as a bitter fight for co-administration: the removal of the respondent as co-
March 22, 1966 Jose S. Matute moved for the dismissal of the administrator and the appointment of anyone of the movants and the herein petitioner
abovementionedpetition on the ground that the Court of Appeals does not have as new co-administrator. Indeed, the principal conflict gravitates over the right to co-
jurisdiction totake cognizance of the same since the value of the estate involved is administer the vast Amadeo Matute Olave estate. This is the same issue underlying
more thanP200,000. He further contended that the value of the Amadeo Matute Olave the respondent'sabovementioned petition in CA-G.R. 37039-R. The respondent's
estatefor purposes of jurisdiction had already been resolved in CA-G.R. 35124-R prayer in said petition unmistakably indicates that the dispute pertains to the right
wherethe Court of Appeals refused to take jurisdiction over a petition to co-administer in general, not the mere authority to collect a P5,000 monthly
for certiorari contesting the appointment of Matias Matute as co-administrator, on the rental.The said prayer reads:
groundthat the value of the Matute estate was placed at P2,132,282.72 as evidenced
by a "Compromise Agreement" dated April 12, 1956 which was duly signed by all of
1. That an ex parte writ of preliminary mandatory injunction be issued
the heirs.
enjoiningand/or prohibiting the respondent Judge from approving the
administrator's bondthat will be filed by respondent Jose S. Matute and in
issuing the letters ofadministration of the latter, and from issuing Orders
incidental and/or connectedwith the exercise and performance of acts of than P200,000.00,the Court of Appeals cannot also have original jurisdiction
administration of said respondent Jose S. Matute; likewise enjoining and to grant the writsof certiorari and prohibition prayed for by respondent in the
prohibiting respondent Jose S. Matutehimself, and/or through his counsels, instant case, whichare merely incidental thereto....
agents and representatives from takingphysical possession of the different
haciendas under the exclusive administrationand management of herein
Note also that the present proceedings under review were for the
petitioner and from performing and exercising acts ofa duly and legally
annulment ofthe appointment of Eliezar Lopez as special co-administrator
appointed administrator, upon filing a bond in such amountthat this
and to restrain theprobate court from removing respondent as special
Honorable Tribunal may fix;
administrator. It is therefore,a contest for the administration of the estate
and, consequently, the amount orvalue of the assets of the whole estate is
2. That the Order of the respondent Judge dated January 31, 1966, the value in controversy. (4 C.J.S. 204.) It appearing that the value of the
removing herein petitioner as co-administrator of the Estate of Amadeo estate in dispute is much more than P200,000.00, the Court of Appeals
Matute Olave andappointing respondent Jose S. Matute as co-administrator clearly had no original jurisdiction to issuethe writs in question. (emphasis
without presentationof evidence, be declared null and void and of no force supplied)
and effect....
Like in the aforecited Maravilla case, the instant intra-fraternal controversy involves a
In fine, the pith of the controversy is the right to co-administer the entire estate. In contest over administration, an incident in the settlement of the vast Matute estate.
this regard, the ruling in Fernandez, et al. vs. Maravilla 1 is determinative of the Considering that the value of the said estate is more thanP200,000, and considering
jurisdictional issue posed here. In said case, this Courtruled that in a contest for the further that as enunciated in the Maravilla case thetotal value of the subject estate
administration of an estate, the amount incontroversy is deemed to be the value of the determines the jurisdictional amount anentdisputes over administration arising as
whole estate, which total valueshould be the proper basis of the jurisdictional amount. incidents in a probate or settlementproceeding, like the case at bar, then it is
Consequently the Courtproceeded to conclude that the Court of Appeals does not indubitable that the respondent Court of Appeals does not have jurisdiction over CA-
have jurisdiction toissue writs of certiorari and preliminary injunction prayed for in a G.R. 37039-R nor the judicial authority to grant the writs of certiorari and prohibition
petition concerning a conflict over administration arising as an incident in the prayed fortherein.
mainprobate or settlement proceeding if in the first place the principal case or
proceeding falls outside its appelate jurisdiction considering the total value of the
Herein respondent insists, however, that even granting that the actual controversy
subject estate. This Court in the aforesaid Maravilla case elaborated thus:
pertains to administration, such contested administration does not encompassthe
whole estate but is limited to the collection of a P5,000 monthly rental,which sum
The Court of Appeals, in the decision appealed from, assumed jurisdiction should be the basis of the jurisdictional amount, not the value ofthe whole estate. In
overthe present case on the theory that "the amount in controversy relative support of his thesis, the respondent alleges that duringhis incumbency as co-
to theappointment of Eliezar Lopez as special co-administrator to protect the administrator, five haciendas in Davao belonging to theestate of his deceased father
interestsof the respondents (herein petitioners) is only P90,000.00 more or were consigned to his separate administration; that in his capacity as co-administrator
less, i.e.,one fourth of the conjugal property" (of respondent and the he leased on February 10, 1965 said haciendas to one Mariano Nasser for P5,000 a
deceased DignaMaravilla) which, as per inventory submitted by the month; that by virtue of said leasecontract, the possession, management and
respondent as special administrator, is valued at P362,424.90. This theory administration of the said properties were transferred to the lessee until the expiration
is untenable. Note that theproceedings had on the appointment of Eliezar of the contract; that consequently, only the collection of the monthly rental of P5,000
Lopez as special co-administrator are merely incidental to the probate or remains asthe subject of the administration.
testate proceedings of the deceased Digna Maravilla.
The foregoing contention of the respondent is patently untenable.

1. The averment of the respondent that the controversy centers on the


That the Court of Appeals have no appelate jurisdiction over the said collectionof the alleged P5,000 monthly rental and that the contest over
testateproceedings cannot be doubted, considering the properties therein administrationis limited thereto, does not find any support in the record.
involved arevalued at P362,424.00, as per inventory of the special
administrator.
2. The rule remains that the jurisdictional amount is determined by the
totalvalue of the estate, not by value of the particular property or portion of
... Not having appelate jurisdiction over the proceedings in probate (CA- the estate subject to administration, since the question of administration is
G.R.No. 27478-R), considering that the amount involved therein is more
merely incidental to the principal proceeding for the settlement and In view of all the foregoing, we are of the consensus that the respondent Courtof
distribution ofthe whole estate. Appeals has no jurisdiction to take cognizance of CA-G.R. 37039-R, and consequently
was without power to issue or grant the writs of certiorariand prohibition prayed for in
said case.
3. The respondent's impression that a co-administrator's trust and
responsibilityare circumscribed and delimited by the size and value of the
particular propertyor portion of the estate subject to his separate Notwithstanding that the herein petitioner delimited the issue, as set forth inhis
administration, is erroneous. Although a co-administrator is designated to petition of certiorari, to one of jurisdiction of the respondent Court of Appeals over CA-
admininister a portion of theestate, he is no less an administrator of the G.R. 37039-R, in subsequent pleadings and manifestations, however, the parties
whole because his judiciousmanagement of a mere parcel enhances the therein mutually expanded the issue to include the question of the legality of the
value of the entire estate, while hisinefficient or corrupt administration controverted order of January 31, 1966 in CA-G.R. 37039-R. As a matter of fact, the
thereof necessarily diminishes the valueof the whole estate. Moreover, respondent, in a "Petition to Resolve" dated July 18,1967, prayed "that a decision on
when two or more administrators are appointed toadminister separate parts the merits in this case be now rendered." To this manifestation, the petitioner replied
of a large estate they are not to discharge theirfunctions in distant isolation "that he has no objection, as in fact, he also prays that this case be decided at the
but in close cooperation so as to safeguard andpromote the general earliest by the Highest Tribunal."
interests of the entire estate. The teaching in Sison vs.Teodoro 2 is of
positive relevance. In the said case, the probate court chargedagainst the
Since the respondent Court of Appeals does not have jurisdiction over CA-G.R.
entire estate the compensation of an administrator who was assignedas
37039-R, we are of the considered opinion that this Court can forestall further delay in
judicial administrator representing the interests of one of the two
the already protracted proceedings regarding the settlement of the Matute estate if it
heiresses.The other heiress whose interest was represented by the
now proceeds to resolve the issue of legality of the abovementioned disputed order,
executor opposed theaward on the ground that the said administrator had
rather than wait for the parties to come anew on a separate petition in quest for a
not rendered service to theestate but only to his wife, the heiress whom he
verdict on the said issue. Moreover, both the petitioner and the respondent private
represented. On appeal, this Court upheld the award and dismissed the
party have manifested and elaborated their respective views on this issue and prayed
opposition:
and pressed for a decision thereon.

This argument erroneously assumes that because Carlos Moran Sison


We shall now discuss separately the twin aspects of the foregoing controverted
was "judicial administrator representing the interests of Priscilla F. Sison" he
order, namely, (1) the removal of the respondent as co-administrator of the Matute
was such administrator "solely for the purpose of protecting Priscilla's
estate, and (2) the appointment of the petitioner as the new co-administrator.
interests," and not to protect those of the estate. No words are needed to
explain that in general,the interest of the heir coincides with those of the
estate — the bigger theestate the better for the heir. Therefore to protect The respondent contends that the disputed order removing him as co-administrator
the interest of heiressPriscilla usually meant to favor the interest of the is a patent nullity for the following reasons:
estate (sic).... Again, the argument presumes that an administrator
appointed by the Court for thepurpose of giving representation to
(1) He was removed in wanton disregard of due process of law because the
designated heirs, is not deemed administratorof the estate. This assumption
probatejudge arbitrarily deprived him of his day in court;
has no legal foundation, because it is admitted practice, where the estate is
large, to appoint two or more administrators ofsuch estate to have different
interests represented and satisfied, and furthermore,to have such (2) The evidence adduced by the movants is manifestly insufficient, if not
representatives work in harmony for the best interests of such estate. (In re devoid of probative value, to warrant his removal; and
Drew's Estate, 236 N.W. 701, 2 C.J. p. 1183) (emphasis supplied)
(3) He was removed not on the grounds specifically invoked by the movants
Verily, therefore, the scope of a co-administrator's trust encompasses the but for causes discovered motu propio by the probate judge in the records
entireestate and is co-extensive in effect with those of the other administrators; of specialproceeding 25876 and without affording him the opportunity to
consequently, the value of the entire estate should be the proper basis of the rebut the findingsof the said judge.
jurisdictional amount irrespective of the value of the particular property orassets of the
estate which are the objects of a separate administration pending the settlement
proceedings. Upon the other hand, the petitioner advances the following reasons in support of the
order of removal:
(1) The probate judge accorded the respondent all the opportunity to ... However, in the remote possibility that this instant motion be denied by
adduce hisevidence but the latter resorted to dilatory tactics such as filing a this Honorable Court, the herein co-administrator expressly reserves his
"motion to dismiss or demurrer to evidence"; right to present his own evidence ... at least five (5) days from the receipt of
said denial.... (emphasis supplied)
(2) The evidences presented to sustain the removal of the respondent are
incontrovertible since aside from being documentary, they are parts of the Instead of resolving the foregoing motion, the probate judge issued the controverted
record of special proceeding 25876; and order removing the respondent as co-administrator without giving him the opportunity
to adduce his own evidence despite his explicit reservation that he be afforded the
chance to introduce evidence in his behalf in the event of denial of his motion to
(3) The evidence on record conclusively supports the findings of the probate
dismiss and/or demurrer to evidence. We are of the view that the above actuation of
judge.
the probate judge constituted grave abuse of discretion which dooms his improvident
order as a nullity. In fact, even without the respondent's reservation, it was the
The settled rule is that the removal of an administrator under section 2 of Rule 82 lies bounden duty of the probate judge to schedule the presentation and reception of the
within the discretion of the court appointing him. As aptly expressed in one respondent's evidence before disposing of the case on the merits because only the
case, 3 "The sufficiency of any ground for removal should thus be determined by the movants at that time had presented their evidence. This duty is projected into bolder
said court, whose sensibilities are, in the first place, affected by any act or omission on relief if we consider, which we must, that the aforesaid motion is in form as well as in
the part of the administrator not conformable to or in disregard of the rules or the substance a demurrer to evidence allowed by Rule 35, by virtue of which the
orders of the court." Consequently, appellate tribunals are disinclined to interfere with defendant does not lose his right to offer evidence in the event that his motion is
the action taken by a probate court in the matter of the removal of an executor or denied. Said Rule states:
administrator unless positive error or gross abuse of discretion is shown. 4
After the plaintiff has completed the presentation of his evidence, the
In the case at bar, we are constrained, however to nullify the disputed order of defendant without waiving his right to offer evidence in the event the motion
removal because it is indubitable that the probate judge ousted the respondent from is not granted, may move for a dismissal on the ground that upon the facts
his trust without affording him the full benefit of a day in court, thus denying him his and law the plaintiff has shown no right to relief. (emphasis supplied)
cardinal right to due process.
The application of the abovecited Rule in special proceedings, like the case at bar, is
It appears that shortly after the reception of evidence for the movants Carlos Matute authorized by section 2 of Rule 72 which direct that in the "absence of special
and the Candelario-Matute heirs, the respondent filed on January 8, 1966a verified provisions, the rules provided for in ordinary civil actions shall be, as far as
objection to the admission in evidence of the movants' exhibits on the ground that the practicable, applicable in special proceedings."
same were hearsay, self-serving, irrelevant and/or mere photostatic copies of
supposed originals which were never properly identified nor produced in court. Four
But what is patently censurable is the actuation of the probate judge in removing the
days later, or on January 12, 1966, the respondent filed with leave of court a "Motion
respondent, not on the strength of the evidence adduced by the movants (not a single
to Dismiss and/or Demurrer to Evidence", the pertinent and material portion of which
exhibit or document introduced by the movants was specifically cited in the disputed
reads:
order as a justification of the respondent's ouster), but on the basis of his (judge's)
findings, which he motu propio gleaned from the records of special proceeding 25876,
... considering the specific objection to each exhibit contained in said without affording the respondent an opportunity to controvert said findings or in the
Objections to Admission of Movants' Exhibits and considering further the very least to explain why he should not be removed on the basis thereof.
ruling of this Honorable Court in open court that pleadings filed in this case
are evidence only of the fact of their filing and not of the truth of the
The probate judge did find, as essayed in his disputed order, that the respondent
statements contained therein and considering still further the fact that no
"has shown indifference to his duties as such co-administrator of the estate" as
competent single witness was presented by movants in support of their
evidenced by:
respective contentions, we submit that there is no sufficient evidence on
record to justify and support the motions for removal of the herein co-
administrator Matias S. Matute and in the light of the authorities hereinbelow (1) the disapproval of his 1964 account by the probate court in an order
cited, the motions to remove Matias S. Matute must be dismissed for dated January 5, 1966 due to his "non-appearance and non-submission of
insufficiency of evidence. evidence to sustain his account on the date set for the presentation of the
same;"
(2) the considerable decrease in the income of the properties under his With the order of January 5, 1966 thus revoked, the probate judge's conclusion that
charge, as reflected in said 1964 account, which circumstance "does not the respondent was "indifferent" to his duties as co-administrator as evidenced by the
speak well of his diligence and attention to the administration of said disapproval of his 1964 account loses its principal basis.
properties;" and
Again using the 1964 account of the respondent as basis of his finding that the
(3) the failure of said 1964 account to disclose the number of calves born respondent was guilty of disinterest in the discharge of his trust, the probate judge
during the accounting period, "thereby indicating a palpable omission of fact stressed that "a verification of said accounting shows the income of the properties
which directly reduced the value of the income or the increase of the assets under his (respondent's) charge were very much reduced which does not speak well
of the estate." of his diligence and attention to the administration of the said properties," and that said
account failed to report the number of "offspring of the cattle during the period of
accounting belonging to the estate, thereby indicating a palpable omission of fact
But, significantly, the movants did not specifically invoke the aforesaid grounds in
which directly reduced the value of the income or increase of the assets of the estate."
support of their petition to oust the respondent. All of the said grounds, which in the
It is pertinent to emphasize here that the said 1964 account is still pending approval,
mind of the probate judge exposed the supposed indifference and incompetence of
hence it was premature to use alleged defects in said account as grounds for the
the respondent in the discharge of his trust, are based on alleged defects of the
removal of the respondent. If it is now ruled that the respondent is unfit to continue as
respondent's 1964 account. Under these circumstances, it behooved the probate
co-administrator because of the alleged infirmities in his account for 1964, the
judge to inform the respondent of his findings before ordering the latter's removal. We
respondent will be greatly prejudiced in the event that said account is finally approved
concede that the probate judge enjoys a wide latitude of discretion in the matter of the
and the said defects are found to be nonexistent or so trivial as not to affect the
removal of executors and administrators and he can cause their ouster at his own
general validity and veracity of the account. Assuming, however, that the probate
instance. However, before they are deprived of their office they must be given the full
judge correctly observed that the said account reflects a big reduction in the income of
benefit of a day in court, an opportunity not accorded to the respondent herein.
the haciendas under the separate administration of the respondent, this fact alone
does not justify the conclusion that the latter did not exercise due care and zeal. There
Without forgetting such patent denial of due process, which rendered the order of is no proof that the decrease in income had been caused by the respondent's willful
removal a nullity, let us examine the merits of the probate judge's motu propio findings negligence or dishonesty. Needless to stress, varied factors, some beyond the control
to determine whether they warrant the ouster of the respondent. of an administrator, may cause the diminution of an estate's income.

As proof of the respondent's "indifference" in the discharge of his duties, the probate Anent the failure to report the number of calves born during the accounting period,
judge cited the court's order of January 5, 1966 disapproving the respondent's 1964 granting that the same is true, there is however no evidence on record to prove that
account for his failure to personally appear on the date set for the submission of the said omission was deliberate or designed to prejudice the estate. It could have
evidence in support of the said account. It must be emphasized, however, that the been either an honest mistake or mere inadvertence. In the absence of competent
respondent, two days before the issuance of the aforesaid order removing him as co- proof to the contrary, good faith must be presumed. The probate judge should have
administrator, seasonably moved for the reconsideration of the aforecited order of required the respondent to explain the said omission instead of branding outright said
January 5, 1966 on the ground that his failure to personally attend the scheduled omission as "palpable."
hearing was due to illness on his part. Evidently, when the probate court decreed the
removal of the respondent, the order disapproving his 1964 account, which was used
In his excursion into the records of special proceeding 25876, the probate judge also
as one of the principal justifications for his removal as co-admininistrator, was not yet
found a copy of a so-called "Compliance" submitted by the respondent which reported
final as it was still subject to possible reconsideration. As a matter of fact, on February
"a very staggering amount of over One Million Pesos supposedly given to the heirs" as
19, 1966 the same probate judge set aside the aforesaid order of January 5, 1966,
advances. The probate judge proceeded to observe that the "record does not show
thus:
that the said advances to the heirs were authorized by the Court in the amounts made
to appear in the 'Compliance.'" He added that a "verification of the record will show
Considering that it will be the benefit of all the parties concerned if former that may be part of this amount supposedly paid by the co-administrator to the heirs
co-administrator Matias S. Matute will be allowed to substantiate the were authorized by the Court but a greater volume of the same was obviously not
accounting which he submitted to this Court but which was disapproved on authorized." On account of this particular finding, the probate court concluded, without
January 5, 1966 for his failure to personally appear at the hearing held for equivocation, that the respondent had been acting without previous authority from the
the purpose of substantiating said accounting, his motion for probate court. Unfortunately again, the respondent was not afforded the opportunity to
reconsideration filed on January 28, 1966 is hereby granted and the order present his side and if possible to controvert the said finding or correct the
dated January 5, 1966 disapproving the accounting submitted by Matias S. impressions of the judge. Hearing the respondent on this point is imperative because,
Matute is set aside. (emphasis supplied) like the other grounds upon which the probate judge anchored the order of removal, it
was not put in issue by the movants, neither was a copy of said "Compliance"
submitted in evidence. It bears emphasis that it there were unauthorized payments of Matias S. Matute. The corollary prayers contained in the same petitions for the
advances to some heirs or simulated grants as the probate judge appears to theorize, appointment of Carlos S. Matute, Jose S. Matute and Agustina Matute Candelario or
then it is most surprising why the prejudiced Matute heirs, litigation-proned as they anyone of them as co-administrator were never even considered at any of the
are, did not impugn the so-called "Compliance." Furthermore, not one of the movants hearings. The requirement of a hearing and the notification to all known heirs and
interested in the removal of the respondent specifically charged the latter with other interested parties as to the date thereof is essential to the validity of the
unauthorized or fictitious payments of advances. It should also be noted that the said proceeding for the appointment of and administrator "in order that no person may be
"Compliance" was submitted by the respondent in response to the probate court's deprived of his right or property without due process of law." (Eusebio vs. Valmores,
order for the submission of "a list of the heirs who have personally received the 97 Phil. 163) Moreover, a hearing is necessary in order to fully determine the
advances from the administration," not from the respondent alone. It stands to reason, suitability of the applicant to the trust, by giving him the opportunity to prove his
therefore, that the said "Compliance" could very well be a cumulative list of all the qualifications and affording oppositors, if any, to contest the said application.
advances given and received by the Matute heirs from the several administrators of
the Matute estate since 1955. In the absence of concrete evidence that the said
The provision of Rule 83 that if "there is no remaining executor or administrator,
"staggering amount" of over a million pesos advances was disbursed by the
administration may be granted to any suitable person," cannot be used to justify the
respondent alone during his beleaguered term which commenced only in 1963, we
institution of Jose S. Matute even without a hearing, because such institution has no
have no recourse but to jettison the adverse conclusion of the probate judge. What the
factual basis considering that there was a general administrator (Carlos V. Matute)
probate judge should have done was to afford Matias the chance to explain and
who remained in charge of the affairs of the Matute estate after the removal of Matias
substantiate the facts and the figures appearing in the aforesaid "Compliance," which
S. Matute. The abovecited provision evidently envisions a situation when after the
unfortunately does not form part of the record before us. The respondent asserts that
removal of the incumbent administrator no one is left to administer the estate, thus
if only the probate judge "took pains to examine fully the voluminous records of the
empowering the probate court, as a matter of necessity, to name a temporary
Matute estate, and as reflected in the very 'Compliance' submitted to the Court ... any
administrator (or caretaker), pending the appointment of a new administrator after due
disbursement given to the heirs by all the administrators of the Estate were by virtue
hearing. Such circumstance does not obtain in the case at bar.
of the several Orders of the Probate Court issued upon joint motion of all the heirs for
their monthly maintenance and support."
Upon the foregoing disquisition, we hold that the respondent Court of Appeals was
without jurisdiction over CA-G.R. 37039-R, and that the controverted order of January
It likewise appears that the respondent was removed partly due to his failure to pay
31, 1966 is a nullity and must therefore be set aside in its entirety.
the inheritance and estate taxes. In this regard, it bears emphasis that the failure to
pay the taxes due from the estate is per se not a compelling reason for the removal of
an administrator, for "it may be true that the respondent administrator failed to pay all L-26085
the taxes due from the estate, but said failure may be due to lack of funds, and not to
a willful omission." 5 In the case at bar there is no evidence that the non-payment of
L-26085 is a petition for certiorari with preliminary injunction interposed on May 19,
taxes was willful. On the contrary, the respondent alleged, and this was unchallenged
1966 by the same petitioner Jose S. Matute, praying that the controverted order of
by the movants, that while the previous administrators left the taxes unpaid, he had
default dated April 16, 1966, judgment by default dated April 23, 1966 and order of
paid the real property taxes in Davao covering the years 1954 to 1966.
execution dated May 3, 1966, all issued by the Court of First Instance of Davao, be
set aside.
We now come to the second part of the controverted order — the appointment of the
petitioner as co-administrator vice the respondent. Since the removal of Matias was
The sequence of events, like in L-26751, commenced with the issuance by the
done with inordinate haste and without due process, aside from the fact that the
probate court (Court of First Instance of Manila) of the order of January 31, 1966
grounds upon which he was removed have no evidentiary justification, the same is
removing Matias S. Matute as co-administrator and replacing him with Jose S. Matute.
void, and, consequently, there is no vacancy to which the petitioner could be
Armed with the letters of co-administration awarded to him on February 3, 1966, Jose
appointed.
attempted to take possession of and exercise administration over the five haciendas
La Union, Sigaboy, Monserrat, Colatinan and Pundaguitan, all belonging to the Matute
Even granting arguendo that the removal of Matias is free from infirmity, this Court is estate and situated in Governor Generoso, Davao. Said five haciendas were
not prepared to sustain the validity of the appointment of the petitioner in place of the previously assigned to the separate administration of the deposed co-administrator,
former. To start with, the record does not disclose that any hearing was conducted, Matias S. Matute.
much less that notices were sent to the other heirs and interested parties, anent the
petition for the appointment of Jose S. Matute, among others, as co-administrator vice
Mariano Nasser, herein plaintiff-respondent, who was in actual possession of the
Matias S. Matute. In this regard, it is pertinent to observe that any hearing conducted
said haciendas, opposed the projected takeover by the defendant-petitioner Jose S.
by the probate court was confined solely to the primary prayers of the separate
Matute in the latter's capacity as co-administrator. Subsequently, on February 15,
petitions of Carlos S. Matute, and the Candelario-Matute heirs seeking the ouster of
1966, Nasser instituted civil case 4968 in the Court of First Instance of Davao, a that on April 16, 1966 the court a quo had declared defendant-petitioner in default
complain for injunction, alleging that the defendant-petitioner was forcibly wresting for failure to answer the complaint in civil case 4928 and that subsequently, on April
possession of the said haciendaswith the aid of hired goons, and praying that the said 23, 1966, a judgment by default had been entered against the latter.
defendant-petitioner be enjoined from taking physical possession, management and
administration of the aforesaid five haciendas. On February 16, 1966 the court a
Immediately after receipt on May 5, 1966 of a copy of the said "Motion to Strike," the
quoissued a writ of preliminary injunction ex parte, prohibiting "Jose S. Matute and/or
defendant-petitioner filed his opposition, asserting that it was legally impossible to
his counsels, agents, representatives or employees from taking physical possession,
declare him in default as of April 16, 1966 for failure to file his responsive pleading,
management and administration" of the abovementioned properties.
considering that it was only after the said date, that is, on April 25, 1966, that he
received, through his counsel, a copy of the order denying his motion to dismiss. On
On February 23, 1966, seven days after he received on February 16, 1966, the the same day, May 5, 1966, the defendant-petitioner's counsel dispatched a rush
summons in civil case 4968, the defendant-petitioner moved to dismiss the aforesaid telegram to the clerk of court of the Court of First Instance of Davao inquiring whether
complaint for injunction and to dissolve the ex parte writ of injunction. Said motion to the trial court had really rendered the order of default dated April 16, 1966 and the
dismiss was predicated mainly on the contention that the court a quo did not have subsequent judgment by default dated April 23, 1966, copies of which had not been
jurisdiction over the subject haciendas considering that the same "are properties received by him. On the following day, May 6, 1966, the defendant-petitioner filed an
in custodia legis under the jurisdiction of the Probate Court of Manila, in Sp. Proc. No. "Urgent Motion to Investigate the Office of the Clerk of Court for Mailing Discrepancy."
25876 since 1955 up to the present time," and consequently the probate court has
exclusive jurisdiction over all cases, like the one at bar, involving possession and
The defendant-petitioner's counsel claims — and this is not controverted by the
administration of the aforesaid haciendas. In the same motion to dismiss, the
respondent Judge and the plaintiff-respondent — that it was only May 17, 1966 that he
defendant-petitioner averred that the alleged contract of lease is simulated and
received a copy of the judgment by default and at the same time a copy of the order of
fictitious for which reason not even a copy of the said contract was attached to the
execution dated May 3, 1966, and that a copy of the order of default had never been
complaint, and that granting that such a contract was actually executed, the same is
furnished him.
invalid as it was never approved by the probate court. On February 28, 1966 the
defendant-petitioner was furnished a copy of the plaintiff-respondent's opposition to
the abovementioned motion to dismiss and to lift the ex parte writ of injunction. Because of the impending execution of the judgment by default with the following
dispositive portion —
Failing to receive any notice of a court resolution on his client's motion to dismiss
during the period of about 1-½ months after the filing of the said motion, the IN VIEW OF ALL THE FOREGOING CONSIDERATIONS, judgment is
defendant-petitioner's counsel on April 11, 1966 wrote the clerk of court of the court a hereby rendered in favor of the plaintiff and against the defendant
quo, requesting that any resolution or order of the trial court be mailed to him by confirming the right of the plaintiff to the possession of the premises leased
airmail at his expense, instead of by surface mail, in order to minimize postal delay. in his favor by the judicial administrator, Matias S. Matute and the injunction
Sometime between April 11 and 19, 1966, the said counsel also dispatched an against the defendant issued in this case is hereby declared permanent and
emissary to Davao to inquire about the status of civil case 4968. After personal defendant is hereby permanently enjoined from interfering in the peaceful
verification of the record, the said emissary reported to the defendant-petitioner's possession of the plaintiff over the haciendas La Union, Sigaboy,
counsel that the abovementioned motion to dismiss had been denied by the court a Monserrrat, Golatinan and Pundaguitan of the estate of Amadeo Matute
quo in an order dated March 31, 1966. It was also discovered from the record that the Olave, all situated in Governor Generoso, Davao and from doing any act of
plaintiff-respondent's counsel had been sent a copy of the order of denial on the very taking any step against the peaceful possession of said properties by the
day it was rendered (March 31, 1966) but the record was silent as to the mailing of the plaintiff. The defendant is likewise ordered to pay the plaintiff the amount of
corresponding copy for the defendant-petitioner's counsel, which copy until then had P50,000.00 as attorney's fees due and payable to plaintiff's counsel for filing
not been received by the latter. Forthwith, on April 19, 1966, although he had not yet this action: P2,400.00 a month beginning February, 1966, representing
been furnished his copy of the said order of denial, defendant-petitioner's counsel monthly salaries of security guards employed by the plaintiff in the
interposed the requisite answer with counterclaim. Then on April 23, 1966 he filed a haciendas leased plus P7,000.00 representing transportation hotel and
manifestation calling the attention of the court a quo that as of the said date he had representation expenses incurred by the plaintiff for plaintiff's counsel and
not received a copy of the order denying his client's motion to dismiss. It was only two another P700.00 representing the yearly premiums on the injunction bond
days later, or on April 25, 1966, that the said counsel claims, uncontroverted by the filed by plaintiff.
respondent Judge and the plaintiff-respondent, that he received his copy of the
aforesaid order.
the defendant-petitioner interposed the instant petition for certiorari with preliminary
injunction to annul the order of default, the judgment by default, and the order of
In a "Motion to Strike" dated April 26, 1966, the plaintiff-respondent urged that the execution, and to restrain the execution of the aforesaid judgment pending the
aforementioned answer with counterclaim be stricken from the record on the grounds resolution of the instant petition.
On May 23, 1966 this Court granted the writ of preliminary injunction prayed for, That due to the fact that I am the only one handling matters relative to Civil
conditioned on the petitioner's posting a bond of P5,000, which he did on June 4, Cases and, because of the volume of my work in the office, I must have
1966. inadvertently misplaced the envelop containing a copy of the Order intended
for Atty. Antonio Enrile Inton, and only discovered by (my) mistake on April
14, 1966, when I went over some papers contained in the drawer of my
We are of the consensus that the herein petition should be granted.
table;

Rule 11, section 1 of the Revised Rules of Court gives the defendant a period of
That upon discovery of the said envelope containing the copy of the order
fifteen (15) days after service of summons within which to file his answer and serve a
dated March 31, 1966, among the papers in my table drawer, I forthwith
copy thereof upon the plaintiff, unless a different period is fixed by the court. However,
sent the same to the one in charge of mailing and who mailed the same
within the period of time for pleading, the defendant is entitled to move for dismissal of
on April 16, 1966, by registered air mail special delivery, as evidenced by
the action on any of the ground enumerated in Rule 16. If the motion to dismiss is
Registry Receipt No. 26897 now attached to the records of this case.
denied or if determination thereof is deferred, the movant shall file his answer within
(emphasis supplied)
the period prescribed by Rule 11, computed from the time he received notice of the
denial or deferment, unless the court provides a different period (Rule 16, section 4).
In other words, the period for filing a responsive pleading commence to run all over It is unmistakable from the foregoing exposition that when the defendant-petitioner
again from the time the defendant received notice of the denial of his motion to was declared in default on April 16, 1966 the time for filing his answer had not yet
dismiss. 6 even commenced to run anew because on the said date his counsel had not yet
received notice of the denial of the motion to dismiss. The order of denial was
received only on April 25, 1966, or definitely after April 16, 1966, the day when a copy
Reverting to the case at bar, the defendant-petitioner was served with summons in
of the said order was mailed to the defendant-petitioner's counsel and when the
connection with civil case 4968 on February 16, 1966, hence he had until March 3,
defendant-petitioner was declared in default.
1966 to file his responsive pleading. Instead of filing an answer,
he seasonably interposed a motion to dismiss on February 23, 1966. Although the
aforesaid motion to dismiss was denied as early as March 31, 1966, he received No further elaboration is needed to show that the trial judge acted in excess of
notice of the denial, through his counsel of record, only on April 25, 1966, a fact not jurisdiction when he declared the defendant-petitioner in default. Consequently, the
traversed by either the respondent Judge or the plaintiff-respondent. Consequently, herein controverted order of default is a patent nullity, an infirmity which likewise
the defendant-petitioner had fifteen (15) days from April 25, 1966, or up to May 10, afflicts, necessarily, the subsequent judgment by default and the order of execution.
1966, to file his answer.
It is not amiss to say that, at the very least, the defendant-petitioner's motion to
The delay in the mailing of a copy of the order of denial to the defendant-petitioner's dismiss should have been considered as an answer, since it raised issues on the
counsel was confirmed by the court a quo in a report rendered after an investigation of merits of the case, such as the invalidity of the alleged contract of lease.
the office of the clerk of court upon urgent motion of the defendant-petitioner. The Consequently, the defendant petitioner should have been notified of the hearing, and
report reads in part: failure to give him an opportunity to appear in the court below tainted the subsequent
proceedings not only with irregularity but also with illegality. It follows, therefore, that
the petitioner was incorrectly declared in default, and the holding of the trial of the
From its investigation of the employee in charge of Civil Cases, the Court
case on the merits in his absences, without due notice to him, was a denial of due
found out that, indeed, there was a delay in the mailing of the Order of this
process. 7
Court dated March 31, 1966 to counsel for the defendant, Atty. Antonio Enril
Inton. This Court, however, is convinced of the sincerity of the reasons given
by the employee concerned, and that is: that her failure to cause to be In opposing the instant petition, the plaintiff-respondent contends that the remedy of
mailed the copy intended for Atty. Antonio Enrile Inton on the same date that the defendant-petitioner is not a petition for certiorari but an ordinary appeal pursuant
she caused to be mailed the copy for Atty. Paterno Canlas (plaintiff- to Rule 41, section 2, paragraph 3 which reads:
respondent's counsel) was purely a case of an honest mistake and
inadvertene on her part owing to the volume of her work; the affidavit of the
A party who has been declared in default may likewise appeal from the
employee in charge of Civil Cases being hereto attached.
judgment rendered against him as contrary to the evidence or to the law,
even if no petition for relief to set aside the order of default has been
The affidavit of the employee concerned mentioned in the above-quoted portion of presented by him in accordance with Rule 38.
the report clearly admits the delay, thus:
We do not agree. The remedy provided for in the abovequoted rule is properly, The nullity of the challenged orders relieves the defendant-petitioner from paying the
though not exclusively, available to a defendant who has been validly declared in damages assessed against him by the court a quo; however, it does not entitle him to
default. It does not preclude a defendant who has been illegallydeclared in default pursue further his claim of possession and administration over the abovementioned
from pursuing a more speedy and efficacious remedy, like a petition for certiorari to five haciendas, considering that we have declared in L-26751 that his appointment as
have the judgment by default set aside as a nullity. co-administrator is void.

It should be emphasized that a defendant who is properly declared in default is In view of the foregoing disquisition, the controverted order of default, judgment by
differently situated from one who is improvidently declared in default. The former default and order of execution should be annulled and set aside.
irreparably loses his right to participate in the trial, while the latter rentals such right
and may exercise the same after having the order of default and the subsequent
L-26106
judgment be default annulled and the case remanded to the court of origin. Moreover
the former is limited to the remedy set forth in section 2, paragraph 3 of Rule 41 by
virtue of which he can contest only the judgment by default on the designated ground L-26106 is another petition for certiorari with preliminary injunction instituted on May
that it is contrary to the evidence or the law; the latter, however, has the option to avail 25, 1966 by Jose S. Matute (the same petitioner in L-26751 and L-26085) and his
of the same remedy or to forthwith interpose a petition for certiorari seeking the brother Luis S. Matute, 13 praying for the nullification of the following orders of the
nullification of the order of default even before the promulgation of a judgment by Court of First Instance of Davao:
default, or in the event that the latter has been rendered, to have both court decrees
— the other of default and the judgment by default — declared void. The defendant-
1. The order of February 15, 1966 dismissing with prejudice civil case 4252,
petitioner's choice of the latter course of action is correct for he controverts the
a complaint filed by Matias S. Matute in behalf of the Matute estate for the
judgment by default not on the ground that it is not supported by evidence or it is
annulment of a compromise agreement and for the reconveyance of certain
contrary to law, but on the ground that it is intrinsically void for having been rendered
properties, in which case Jose and Luis Matute appeared as intervenors in
pursuant to a patently invalid order of default.
alliance with the plaintiff estate;

Granting, however, that an appeal is open to the defendant-petitioner, the same is no


2. The order of March 29, 1966 declaring in default the intervenors in civil
longer an adequate and speedy remedy considering that the court a quo had
case 4252 for failure to answer the defendant Paterno Canlas' counterclaim,
already ordered the issuance of a writ of execution and the carrying out of such writ
and adjudging them to jointly and severally pay the sum of P100,000 in
loomed as a great probability. This is in consonance with the doctrine enunciated
damages to the said Canlas; and
in Vda. de Saludes vs Pajarillo and Bautista 8 wherein this Court held that an "appeal
under the circumstances was not adequate remedy there being an order of execution
issued by the municipal court." Hence, the rule that certioraridoes not lie when there is 3. The order of April 12, 1966 directing the issuance of a writ of execution
an appeal is relaxed where, as in the instant case, the trial court had already ordered against the intervenors to enforce the abovementioned judgment by default.
the issuance of a writ of execution. 9
The factual milieu follows:
The plaintiff-respondent also argues that the instant petition should be denied for
failure of the defendant-petitioner to move for a reconsideration of the challenged
decrees so as to afford the court a quo the chance to amend its errors. While as a On February 5, 1966 Matias S. Matute, in his capacity as co-administrator, instituted
matter of policy a motion for reconsideration in the lower court has often been in the name of the Matute estate civil case 4252 praying for, among others, (1) the
considered a condition sine qua non for the granting of a writ of certiorari, this rule annulment of the compromise agreement dated November 26, 1962 entered into
does not apply "where the proceeding in which the error occurred is a patent between the co-administrator Julian V. Matute and Atty. Paterno R. Canlas, one of the
nullity," 10 or where "the deprivation of petitioner's fundamental right to due process ... defendants-respondents herein, in full settlement of the latter's claim for attorney's
taints the proceedings against him in the court below not only with irregularly but with fees against the decedent Amadeo Matute Olave; (2) the nullification of the
nullity," 11 or when special circumstances warrant immediate and more direct compromise judgment of December 5, 1962 approving the aforesaid compromise
action. 12 The fact that the defendant-petitioner had been deprived of due process, agreement; (3) the voiding of the deed of conveyance and assignment of rights dated
taken together with the circumstance that a writ of execution had already been issued, December 20, 1962 by virtue of which the said Julian Matute transferred to Canlas
perforce takes this case outside of the purview of the rule requiring a previous motion several parcels of land belonging to the Matute estate pursuant to the compromise
for reconsideration. judgment; (4) the annulment of the deed of conveyance covering the said parcels of
land executed on February 20, 1963 by Canlas in favor of Daniel Rivera, Sr., also one
of the defendants-respondents; (5) the nullification of the unregistered deeds of
mortgages, both date July 19, 1963, over said properties executed by Rivera in favor
of Pablo del Rosario and Nicanor Vergara, also defendants-respondents herein; and Paterno R. Canlas filed his Opposition to petition for Relief, and, on June
(6) the reconveyance of the said properties. 26, 1963, a Supplementary Opposition to Petition for Relief and refuting all
the above issues raised in the Petition for Relief, copies of which are hereto
attached as Annexes "D" and "E". Rosario and Trinidad Suazo Matute filed
The aforesaid complaint was anchored on the grounds that (1) the compromise
Reply and defendant Paterno R. Canlas filed his Rejoinder on July 8, 1963
agreement was entered into in fraud of the Matute estate; (2) Julian Matute, as a mere
attaching therewith the letter-conformity to the Compromise Judgment of co-
co-administrator, had no authority to enter into the said compromise agreement
administrator, Matias S. Matute, copies of which are hereto attached as
without the consent of the then general administrator, Don Celestino Alonzo; (3) the
Annexes "F" and "F-1" of this Motion to Dismiss. That on July 13, 1963,
compromise agreement was approved by the Court of First Instance of Manila (Branch
Branch X of the Court of First Instance of Manila, taking cognizance of Civil
X) without notice to the heirs and the general administrator; and (4) the said
Case No. 14208, rightfully denied the Petition for Relief on all the grounds
agreement had neither prior nor subsequent approval of the probate court which has
stated in our Opposition to the Petition for Relief, Supplementary
custody of the parcels of land involved in the said agreement.
Opposition, etc., and Rejoinder, a copy of which order is hereto attached as
Annex "G" of this Motion to Dismiss.
The defendant-respondent Canlas subsequently interposed a motion to dismiss
dated February 24, 1964 predicated on the ground of res judicata, among others.
In other words, it is the basic contention of Canlas that both the compromise
Anent the issue of res judicata, said motion to dismiss averred:
judgment of December 5, 1962rendered by the Court of First Instance of Manila
(Branch X) 14 and the order of the same court dated July 13, 1963denying the
The records of Civil Case No. 14208, entitled "Rosario Matute, et al. v. aforecited petition for relief from judgment which sought the setting aside of the said
Amadeo Matute Olave", Court of First Instance of Manila, Branch X, will compromise judgment, bar by virtue of res judicata the prosecution of the
show that on December 5, 1962, the Honorable Judge Jose L. Moya, abovementioned civil case 4252 which seeks anew the annulment of the said
Presiding Judge of Branch X, of the Court of First Instance of Manila, compromise judgment on practically the same grounds invoked in the aforesaid
rendered a Compromise Judgment ... pursuant to a Compromise Agreement petition for relief, which grounds were justifiably denied by the competent court.
... entered into between defendant Paterno R. Canlas and the Estate of
Amadeo Matute Olave, duly represented by the General Administrator of the
It appears that on the same day Canlas filed his motion to dismiss, the general
Estate, the late Julian V. Matute and his counsel of record in said Civil Case
administrator and heir, Carlos V. Matute, filed his own motion to dismiss dated
No. 14208, Atty. Marcelo Rafols Javier involving the attorney's fees of
February 15, 1964, stating among other things, that he had never authorized his co-
defendant Paterno R. Canlas in said Civil Case No. 14208, secured with a
administrator, Matias Matute, to file civil case 4252 in the name of the estate and that
charging lien on the properties involves herein. Pursuant to said
said complaint was filed without legal authority and is prejudicial to the interests of the
Compromise Judgment, the said Julian V. Matute, as General Administrator
estate as it would only entail unnecessary litigation expenses. He presented his
of the Estate of his deceased father, Amadeo Matute Olave, transferred and
written conformity to the compromise judgment in his capacity as the succeeding
conveyed the properties involved herein which were ordered to be sold by
general administrator.
the Probate Court of Manila for only P144,000.00, in favor of defendant
Paterno R. Canlas as full payment of his attorney's fees in Civil Case No.
14208 in the amount of P200,000.00 agreed upon in the Compromise On February 27, 1964 the defendants-respondents Daniel Rivera, Sr., Pablo del
Agreement. The said Compromise Judgment of December 5, 1962 is Rosario and Nicanor Vergara filed their own joint motion to dismiss, alleging among
immediately final and not appeallable and has the effect and authority of other things that they were innocent transferees and mortgages for value of the
Res Judicata in this case filed by co-administrator, Matias S. Matute, on properties subject matter of the complaint and adopted as their own the motions to
behalf of the Estate, without authority of his general administrator, Carlos V. dismiss filed by Canlas and Carlos V. Matute.
Matute, who filed a Motion to Dismiss the complaint in this case
On April 11, 1964 the Honorable Judge Vicente N. Cusi, Jr., executive judge of the
That the records of Civil Case No. 14208 will show that after the Court of First Instance of Davao, issued an order deferring to after the trial the final
Compromise Judgment was rendered on December 5, 1962, a Petition for hearing and determination of the motions to dismiss since the grounds alleged therein
relief to set aside the said Compromise Judgment was filed by two (2) of the "do not appear to be indubitable." From this order, the defendants moved for a
heirs and full-blooded sisters of plaintiff co-administrator, Matias S. Matute, reconsideration which was denied on January 16, 1965.
namely, Rosario and Trinidad Suazo Matute on June 6, 1963, on grounds of
(a) fraud and (b) lack of the probate court's approval to the Compromise
Meanwhile, on August 17, 1964 Jose and Luis Matute filed a motion to intervene,
Agreement, the very same grounds alleged in the present Complaint of
asking that they be allowed to adopt the complaint of the plaintiff-estate. Said motion
plaintiff Estate, a copy of the Petition for Relief is hereto attached as Annex
was granted on September 5, 1964.
"C" of this Motion to Dismiss. That on June 13, 1963, herein defendant
After the aforesaid rejection of the defendants' motion for reconsideration of the order Subsequently, Matias Matute filed in behalf of the plaintiff-estate a motion to
denying their separate motions to dismiss, Canlas filed on February 15, 1965 his withdraw and/or dismiss with prejudice the complaint in civil case 4252, which, it will
answer ad cautelam, traversing the material allegations of the complaint in civil case be recalled, he himself instituted in the name of the Matute estate. The following
4252 and interposing the grounds stated in his motion to dismiss as affirmative grounds were advanced to justify the said motion:
defenses. He also filed a counterclaim for damages in the amount of
P100,000 jointly against Matias Matute, for filing the "frivolous and unfounded" action
That after a thorough study of the documents presented by the parties in
in the name of the estate, and Jose an Luis Matute, for intervening in the case. All
this case, the undersigned Judicial Administrator realized that he has
there were charged in their personal capacities. On the same date, the other
expressly ratified and confirmed any and all contracts and compromise for
defendants, Rivera, del Rosario and Vergara, filed their own answer ad cautelam,
attorney's fees that his co-administrator Julian V. Matute has already
denying the essential averments of the complaint having relevance to them and
entered into with the defendant Atty. Paterno R. Canlas in his capacity as
adopting the affirmative defenses interposed by Canlas. Said defendants similarly
co-administrator of the said testacy;
interposed a counterclaim of P50,000 for damages, directed against the plaintiff-
estate.
That the causes of action of the above-entitled complaint against the
defendants were based and predicated from the compromise agreement
On March 1, 1965 Matias Matute, representing the plaintiff-estate, filed the
entered into between
corresponding answers to the foregoing counterclaims. The answer to Canlas'
co-administrator Julian V. Matute and the defendant Paterno R. Canlas on
counterclaim specifically denied.
December 2, 1962 and which compromise agreement was approved by
Judge Jose Moya, presiding Judge of Branch X of the Court of First
that the above-entitled case is patently frivolous and unfounded and was Instance of Manila, in Civil Case No. 14208 entitled Rosario S. Matute, et al.
instituted in bad faith and calculated to merely harass the defendant in order vs. Amadeo Matute Olave, etc., in the Compromise Judgment dated
to satisfy the personal revenge, hatred and vindictiveness of the co- December 5, 1962.
administrator Matias S. Matute, representing the plaintiff estate, and
intervenors Jose S. Matute and Luis S. Matute, the truth being that the
On February 15, 1966 the respondent Judge dismissed with prejudice the aforesaid
complaint in the above-entitled case was instituted precisely to prevent
complaint. The order of dismissal reads:
defendants from illegally and fraudulently transforming and conveying
themselves valuable properties of plaintiff estate worth more than
P500,000.00; The records show that this action was filed by Matias S. Matute in his
capacity as co-administrator of the Estate of Amadeo Matute Olave
appointed in Sp. Proc. No. 25876, Probate Court of Manila, to annul a
and disclaimed any
compromise judgment awarding attorney's fees to defendant Atty. Paterno
R. Canlas and rendered in Civil Case No. 14208, Court of First Instance of
knowledge of any actual, moral and consequential damage having been Manila.
suffered by defendant Paterno R. Canlas.
Pending incidents in this case, are the motion to dismiss and
Meanwhile, upon motion of the counsels for the defendants, Judge Cusi ordered on supplementary motion to dismiss on the ground of res judicata filed by the
August 28, 1965 the reshuffle of civil case 4252 in accordance with section 7, Rule 22 defendants and adopted by the General Administrator of the Estate, Carlos
of the Rules of Court. Eventually, the case was transferred to the sala of Judge V. Matute, and the heirs Maria Luisa Matute, Conchita V. Matute, Carlos S.
Vicente P. Bullecer, the respondent judge herein. Matute, Ramos S. Matute, Eduarda S. Matute and Mrs. Cecilia Villanueva
Matute.
On January 22, 1966 Canlas filed a "Motion to Resolve: I. Motion to Dismiss; II.
Supplementary and/or Second Motion to Dismiss." It appears now that the co-administrator Matias S. Matute who filed this
action in the name of the Estate of Don Amadeo Matute Olave filed a motion
to withdraw and/or dismiss dated January 8, 1966 and verified before the
On February 3, 1966 Jose Matute interposed an urgent ex parte motion for
acting Clerk of Court of Appeals stating that he is withdrawing the complaint
substitution as representative of the plaintiff-estate in place of Matias Matute, citing the
he filed in this case and prays this Court to dismiss it with prejudice and
order of January 31, 1966 of the probate court of Manila which appointed him as co-
further ratifying and expressing conformity to the compromise judgment
administrator in place of Matias Matute.
subject matter of the complaint rendered in the Civil Case 14208, Court of
First Instance of Manila.
As prayed for in defendants' motion to dismiss and supplementary action as co-administrator remained unimpaired because the order of January 31, 1966 is a
(motion) to dismiss, the action filed in this case is hereby dismissed with nullity.
prejudice without cost to plaintiff . (emphasis supplied).
However, the intervenor-petitioner is of the mistaken impression that the disputed
On March 12, 1966 the respondent Judge issued another order declaring that "all the order of dismissal was based on Matias Matute's motion to dismiss and/or to withdraw.
other incidents pending in this case are hereby terminated and closed." (Emphasis As correctly pointed out by the defendants-respondents, the said order was anchored
supplied) Said order reads: on their own motion to dismiss and supplementary motion to dismiss. Although both
the motions of the co-administrator in representation of the plaintiff estate and of the
defendants, either of which could justify the dismissal of the complaint in civil case
Considering the order of this Court dated February 15, 1966 dismissing
4252, were prominently mentioned in the body of the said controverted order, the
this case with prejudice on the ground of res judicata in view of the final
unequivocal import of the dispositive portion of said decree, however, is that the
order of July 31, 1963 issued by the Court of First Instance of Manila,
dismissal was predicated on the defendants' motion to dismiss and supplementary
Branch X, in Civil Case No. 14208, as alleged in the defendants' motion to
motion to dismiss, thus:
dismiss and supplementary motion to dismiss: and considering further that
the co-administrator Matias S. Matute who filed the complaint in this case in
the name of the plaintiff Estate has withdrawn and/or prayed for the As prayed for in defendants' motion to dismiss and supplementary action
dismissal of this case with prejudice, and considering furthermore, that the to dismiss, the action filed in this case is hereby dismissed with prejudice
said Order of this Court of February 15, 1966 is now fixed and final, all the without cost to plaintiff. (emphasis supplied)
other incidents pending in this case are hereby terminated and closed.
Moreover, both the order of March 12, 1966 declaring the termination of all other
However, on March 29, 1966 the respondent Judge promulgated an order declaring incidents in civil case 4252 and the order of April 11, 1966 denying the intervenors'
in default both the intervenors and the plaintiff estate, the former for failure to answer motion for reconsideration, categorically affirm that the disputed order of dismissal
Canlas' counterclaim and the latter for failure to respond to the other defendants' was anchored on the defendants' motion to dismiss on the ground of res judicata. The
separate counterclaim. The same decree included a judgment by default condemning order of April 11, 1966 specifically declares that the dismissal of civil case 4252 was
the intervenors to jointly and severally pay the sum of P100,000 as damages to based
Canlas and likewise sentencing the plaintiff estate to indemnify the other defendants
Rivera, del Rosario and Vergara in the sum of P50,000. Subsequently, on April 12,
... on the ground of res judicata invoked by the defendants in their Motion
1966 the respondent Judge ordered the issuance of a writ of execution to enforce the
to Dismiss and Supplementary Motion to Dismiss for the reason that the
aforesaid judgment by default.
Compromise Judgment rendered in Civil Case No. 14208, Court of First
Instance of Manila, sought to be annulled in this case, and the Order of July
Hence, the interposition by the intervenors of the instant petition for certiorari with 31, 1963 denying the Petition for Relief in Civil Case No. 14208 and settling
preliminary injunction. all the issues raised in the Complaint, have both the force and effect of res
judicata.
Anent the order of February 15, 1966 dismissing with prejudice civil case 4252, the
intervenors-petitioners (now Jose Matute alone, as the other petitioner, Luis Matute, Undeniably, the aforesaid order of dismissal with prejudice adjudicated civil case
has already withdrawn) contend that the said order is a nullity as it was predicated on 4252 upon the merits. Since there is no showing that the respondent Judge issued the
a void motion to dismiss and/or withdraw filed by Matias Matute on February 14, 1966, said order with grave abuse of discretion or without or in excess of jurisdiction, an
two weeks after the latter had been removed as co-administrator by the probate court ordinary appeal, then, not a petition for certiorari, was the proper remedy available to
in an order dated January 31, 1966. It is further maintained that when Matias Matute the intervenors Jose and Luis Matute who claim to be aggrieved, by the dismissal. But
interposed the aforesaid motion to dismiss and/or to withdraw, he had no more having failed to seasonably appeal from the aforesaid order of dismissal, the herein
authority to represent the Matute estate as a consequence of his ouster as co- intervenor-petitioner cannot avail of a petition for certiorarias a substitute remedy 15 to
administrator. The foregoing argument is irredeemably foreclosed by our explicit ruling challenge the said order, which in the meantime had already become final.
in L-26751 setting aside the abovementioned order of January 31, 1966 and declaring
as void the removal of Matias Matute and the appointment of the herein intervenor-
The pretention of the intervenor-petitioner that his inability to appeal on time was due
petitioner Jose S. Matute as the new co-administrator. Granting, therefore, that the
to the failure of the court a quo to furnish him a copy of the order of dismissal is a
controverted order of dismissal was rendered on account of Matias Matute's aforesaid
spurious, if not an utterly perfidious, claim. To begin with, when the herein intervenor-
motion which was filed in behalf of the plaintiff estate, the validity of such dismissal
petitioner and his brother Luis filed their motion to intervene on August 17, 1964, they
order cannot be challenged on the ground that the movant (Matias Matute) lacked the
were not represented by counsel, but they failed to disclose their respective
capacity to represent the plaintiff estate considering that his personality and authority
addresses or at least the address of one of them, contrary to the requirement of emphasize, on the other hand, that an order deferring the resolution of a motion to
section 5 of Rule 7 that a "party who is not represented by an attorney shall sign his dismiss, being an interlocutory order, may be altered or revoked by the trial court
pleadings and state his address." (emphasis supplied) Consequently, if the pertinent during the pendency of the main action. It is settled that an "interlocutory order or
orders and notices were not sent to the intervenors, it was because of their failure to decree made in the progress of a case is always under the control of the court until
disclose their mailing addresses. At all events, since the intervenors virtually allied with the final decision of the suit, and may be modified or rescinded upon sufficient
the plaintiff estate by adopting in toto the latter's complaint without filing a separate grounds shown at any time before final judgment...." 16 Of similar import is the ruling of
complaint in intervention, it is not without justification to rule, considering the particular this Court declaring that "it is rudimentary that such (interlocutory) orders are subject
circumstances obtaining, that notice to the plaintiff estate should be deemed sufficient to change in the discretion of the court. 17 Moreover, one of the inherent powers of the
notice to the intervenors. Moreover, it is of record that both Attys. Wenceslao Laureta court is "To amend and control its process and orders so as to make them
and Robert Porter, who appeared on February 7, 1966 as counsels for the intervenor conformable to law and justice." 18 In the language of Chief Justice Moran,
Jose S. Matute in his capacity as alleged co-administrator by virtue of the abovecited paraphrasing the ruling in Veluz vs. Justice of the Peace of Sariaya, 19 "since judges
order of the probate court dated January 31, 1966, were duly furnished with copies of are human, susceptible to mistakes, and are bound to administer justice in
all orders of the court a quosubsequent to their appearance. Anent the order of accordance with law, they are given the inherent power of amending their orders or
dismissal dated February 15, 1966, the lower court reported, after an investigation of judgments so as to make them conformable to law and justice, and they can do so
the deputy clerk of court for alleged mailing discrepancies upon motion of the before they los their jurisdiction of the case that is before the time to appeal has
intervenors, that copies of the said order were "each mailed to and received by Attys. expired and no appeal has been perfected." 20 And in the abovecited Veluz case, this
Wenceslao Laureta and Robert E. Porter on March 18 and 3, 1966, respectively, per Court held that "If the trial court should discover or be convinced that it had committed
registry return cards duly attached to the records of this case." In other words, the an error in its judgment, or had done an injustice, before the same has become final, it
intervenor-petitioner Jose S. Matute was furnished, through counsel, a copy of the may, upon its own motion or upon a motion of the parties, correct such error in order
order of dismissal at the earliest on March 3, 1966 when Atty. Porter received a copy to do justice between the parties.... It would seem to be the very height of absurdity to
of the order. After a lapse of twenty-three (23) daysfrom the receipt of the said copy, prohibit a trial judge from correcting an error, mistake, or injustice which is called to his
Attys. Laureta and Porter filed on March 26, 1966 a motion for reconsideration of the attention before he has lost control of his judgment." Corollarily, it has also been held
order of dismissal. Hence, when the said motion was filed, the intervenor-petitioner "that a judge of first instance is not legally prevented from revoking the interlocutory
had still seven (7) days to perfect an appeal. Subsequently, on April 11, 1966, the order of another judge in the very litigation subsequently assigned to him for judicial
court a quo denied the aforesaid motion for reconsideration. Separate copies of said action." 21
denial were received by Atty. Laureta on April 16, 1966 and by Atty. Porter on April 18,
1966, respectively, as per registry receipts 25870 and 25872 and delivery No. 69785
In view of the foregoing rulings, it is then enough to say that the abovementioned
and the reply-telegram dated July 2, 1966 from the Bureau of Posts addressed to the
order of deferment, issued by the Honorable Judge Vicente Cusi, Jr., to whose sala
respondent Judge. From April 16, 1966, the intervenor-petitioner still had seven (7)
civil case 4252 was originally assigned, is interlocutory in nature, and as such, the
days or up to April 23, 1966 to perfect an appeal. However, it was only on April 25,
court a quo, through the now respondent Judge Vicente Bullecer, had the power to set
1966 that the requisite notice of appeal and appeal bond were filed while the record
it aside, as it did by finally deciding the pending motion to dismiss on the ground of res
on appeal was filed much later, on May 26, 1966, clearly way beyond the
judicata. Moreover, as previously stated, there is no evidence to show that the
reglementary period.
respondent Judge, in issuing the order of dismissal, acted with grave abuse of
discretion or without or in excess of jurisdiction.
The intervenor-petitioner contends, however, that it was only on April 25, 1966 that
he received notice of the dismissal of civil case 4252 and on the very same day he
We now come to the challenged order of default and judgment by default, both
caused the filing of the necessary notice of appeal and appeal bond. Conceding that
contained in the abovementioned order dated March 29, 1966. Attacking the validity of
the foregoing assertion is correct, the intervenor-petitioner's projected appeal was still
the said order of default, the intervenor-petitioner claims that the respondent Judge
out of time since the requisite record on appeal was filed only on May 26, 1966, or
failed to consider that Matias Matute, representing the plaintiff estate, filed on time an
thirty-one days from April 25, 1966.
answer dated March 1, 1965 traversing the allegations of Canlas' counterclaim, which
answer inured to the benefit of not only Matias Matute but also to the intervenors who
In passing, it is pertinent to note that the dismissal of the complaint in civil case were jointly impleaded as defendants in the said counterclaim. The defendant-
4252m, after the issues were joined with the filing of the responsive pleadings, upon respondent Canlas, on the other hand, while not denying receipt of the aforesaid
the defendants' motion to resolve a pending motion to dismiss, the resolution of which answer to his counterclaim, contends that the herein intervenor-petitioner's failure to
had been previously deferred until after the trial by virtue of an order of the same court personally answer said counterclaim is fatal and that he could not take refuge under
under another judge, is a procedural deviation from the standard sequence of trial in the answer interposed by Matias Matute.
accordance with which the court a quo, after the requisite answers were filed, should
have proceeded with the trial on the merits, and only thereafter resolved the motion to
dismiss as was the import of the order of defendant. Nevertheless, it is relevant to
We are of the considered opinion that the herein disputed order of default is illegal praying that the said estate be allowed to adopt the instant petition for certiorari with
and void, and, consequently, the controverted judgment by default and order of preliminary injunction and be admitted as co-petitioner, the resolution of which we had
execution were improvidently issued. previously deferred, should therefore be denied on the ground that the intervenor-
petitioner has no legal personality to represent the Matute estate considering that his
appointment as co-administrator has been voided. Nevertheless, it is our considered
1. The counterclaim interposed by Canlas raised a common cause of action for
view that the declaration of total nullity of the abovementioned judgment by default
damages against Matias Matute, as the representative of the plaintiff estate, and Jose
shall perforce bar the execution against the Matute estate of that portion of the said
and Luis Matute, as intervenors in civil case 4252, all in their personal capacities. The
void judgment which condemns it to pay the sum of P50,000 in damages to the
counterclaim reads:
defendants-respondents Rivera, del Rosario and Vergara.

That for instituting this patently frivolous and unfounded action in bad faith
ACCORDINGLY, (1) in L-26751 the petition for certiorari is hereby granted; the
calculated to merely harass answering defendant Paterno R. Canlas in
respondent Court of Appeals is adjudged as without jurisdiction over CA-G.R. 37039-
order to satisfy the personal revenge, hatred and vindictiveness of the co-
R; the probate court's controverted order of January 31, 1966 is hereby set aside in its
administrator, Matias S. Matute, representing the plaintiff Estate, and the
entirety, thereby maintaining the respondent Matias S. Matute in his trust as co-
intervenors Jose S. Matute and Luis S. Matute, defendant Paterno R.
administrator of the Amadeo Matute Olave estate; (2) in L-26085 the petition
Canlas suffered actual, moral and consequential damages in the total
for certiorari is hereby granted; the order of default dated April 16, 1966, the judgment
amount of P100,000.00, for which plaintiff Matias S. Matute and intervenors
by default dated April 23, 1966, and the order of execution dated May 3, 1966, all
Jose S. Matute and Luis S. Matute should be held personally liable.
issued in excess of jurisdiction by the respondent Judge of the Court of First Instance
(emphasis supplied)
of Davao, are set aside; and (3) in L-26106 the petition for certiorari is hereby denied
in so far as it seeks to nullify the final order of dismissal dated February 15, 1966; the
Having been this jointly charged to pay the abovestated damages, the brothers order of default and judgment by default dated March 29, 1966 and the order of
Matias, Jose and Luis Matute could validly file a common responsive pleading, as in execution dated April 12, 1966, all similarly issued in excess of jurisdiction by the
effect they did when Matias Matute filed an answer to the aforesaid counterclaim, the same respondent Judge are set aside. No pronouncement as to costs.
receipt of which Canlas admits. It is significant to note that the said answer does not
only deny the charge against Matias Matute but as well as negates the claim against
the intervenors.

2. Moreover, having successfully prayed for the resolution of his pending motion to
dismiss, even after the issues had been joined with the filing of his answer, the
defendant-respondent Canlas is deemed to have abandoned his counterclaim and
voluntarily reverted himself to the time when he initially interposed his motion to
dismiss prior to the filing of his answer with counterclaim. Thus, when the complaint in
civil case 4252 was dismissed on the basis of Canlas' motion, the entire proceeding
was inevitably terminated and there was nothing more to adjudge. In fact, the
termination of all the pending incidents in civil case 4252 was subsequently decreed
by the respondent Judge himself in the orders of March 12, 1966 and April 11, 1966.
Consequently, the respondent Judge, to say the least, acted in excess of jurisdiction
when he issued, after having dismissed the principal complaint, the herein
controverted order of default and judgment by default for then there was nothing left to
be adjudicated. Said decrees having been rendered in excess of
jurisdiction, certiorari will lie to have then annulled.

In view of the foregoing discussion, the finality of the order of dismissal should be
upheld, while the disputed order of default, judgment by default and order of execution
should be declared void and set aside.

The motion interposed on June 14, 1966 by the herein intervenor-petitioner, in his
alleged capacity as co-administrator, in behalf of the Amadeo Matute Olave estate,
G.R. No. L-12053 May 30, 1958 Was there abuse of discretion? The lis pendens had been obviously annotated for the
purpose of advising any one who might wish to buy the realty, that there is in court a
petition to declare Roberta Diaz incompetent to dispose of her properties so that such
ROBERTA DIAZ Y CRUZ, petitioner, purchaser may make the necessary inquiries and take steps to protect his interest,
vs. bearing in mind that if said Roberta Diaz should be declared incompetent, his
HON. JESUS Y. PEREZ, presiding Judge, 7th Branch, Court of First purchase will be or might be affected adversely. 5 It is a proper cautionary measure
Instance, Pasay City, ET AL.,respondents. which the courts should be slow to disturb, unless the petition for guardianship
was prima facie unconvincing, or was not made in good faith, or as alleged by
petitioner here, the pendency of guardianship proceedings may not be considered
Roberta Diaz y Cruz is an old woman, 83 years of age, residing in Pasay City as lis pendens affecting the realties of the person allegedly incompetent.
possessing real and personal properties roughly estimated at half a million pesos.

"The effect of filing a notice of lis pendens is to charge the stranger with notice of the
On August 18, 1956, three of her nine legitimate children, and two of her particular litigations referred to in the notice; and if the notice is effective, a third party
grandchildren by another daughter, joined in a Petition addressed to the Rizal Court of who acquires the property affected by the lis pendens takes subject to the eventually
First Instance, to declare her incompetent to take care of herself and manage her of the litigations."6
properties and to appoint a guardian of her person and her properties. The allegations,
too long to relate, set out a prima facie case of incompetency 1 (Special Proceeding
1483-P). And its purpose is "to hold property within the jurisdiction and control of the court
pending determination of the controversy, thereby preventing third persons from
acquiring such interests therein as would preclude giving effect to the judgment." 7
On November 7, 1956 while the above special proceeding was pending hearing
before respondent Judge Jesus Y. Perez, Roberta Diaz y Cruz received from the
Register of deeds of Rizal a letter advising her that by reason of said proceedings, a In the light of the object and salutory effects of the notation, we see no reason to
notice of lis pendens had been annotated on her Transfer Certificate of Title to real declare it improper in this case, specially because the allegations of the guardianship
property No. 32872 of that Province. petition specified instances wherein the incompetent disposed of her properties in
favor of persons allegedly taking undue advantage age and weak mental and physical
condition.
Wherefore, on November 29, 1956, she filed in the above-mentioned proceedings a
petition to cancel the lis pendens. In view of the opposition of the adverse parties, the
respondents judge denied the petition. Her motion to reconsider having failed, Roberta The argument is presented that sec. 79 Of Act No. 496 sec. 24 of Rule 7 indicate the
Diaz filed a notice of appeal, record on appeal, and appeal bond. cases wherein lis pendensmay be annotated, and that guardianship proceedings is
not included therein. In the first place sec. 79 is not an exclusive enumeration. In the
second place, these proceedings affect "the use" or possession of the real estate
But on January 22, 1957, the respondent judge disapproved the record on appeal, within the meaning of above sections, even "the title", in the sense that the
holding the appealed orders to be interlocutory, and therefore not appealable. proceedings will curtail or take away the right of the owner to dispose of the same.

So on February 26, 1957, this petition for mandamus and certiorari was filed in this Anyway, it is to be doubted whether the above sections were intended to be exclusive
Court. The first, to compel approval of the record on appeal; the second, to annul the of other circumstances wherein equity and general convenience would make lis
order refusing cancellation of the notice of lis pendens. pendens appropriate. Indeed, cases have held it to be proper in receivership
proceedings8 involving realty, and in lunacy proceedings 1 situations closely akin to
We think mandamus does not lie. As the respondent judge said, the order was the instant litigation.
interlocutory, which can not "be the subject of appeal until final judgment is rendered."
(Section 2, Rule 41.) It is comparable with an order refusing to annul a preliminary In this connection, it is insisted that both sections only apply to "actions" which are
attachment2 or an order denying or granting a preliminary injunction 3 which have been different from "Special proceedings", like guardianship. It is enough to point out that
held to be interlocutory4 the Rules provided for civil actions are generally applicable to special proceedings.
(Rule 73, section 2.)
As to the certiorari, petitioner may not seriously urge lack of jurisdiction. In asking the
Court to annul the lis pendensshe admitted its jurisdiction to annul — and also to Lastly, we are advised that after hearing the petition the lower court found in April 1957
refuse annulment. that by reason of her advanced age and weak mind, Roberta Diaz could not manage
her properties — she does not even remember them — and needed a guardian to
help administer her interests. This, in a way, vindicates the annotation and the court's
refusal to cancel it.

Clearly then no abuse was made of the court's discretion. Petition denied, with costs.
MICHAEL C. GUY, G.R. No. 163707 assistance received from petitioner, Remedios and her minor children discharge the
estate of Sima Wei from any and all liabilities.

The Regional Trial Court denied the Joint Motion to Dismiss as well as the
Supplemental Motion to Dismiss. It ruled that while the Release and Waiver of Claim
This petition for review on certiorari assails the January 22, 2004 Decision[1] of the
was signed by Remedios, it had not been established that she was the duly
Court of Appeals in CA-G.R. SP No. 79742, which affirmed the Orders dated July 21,
constituted guardian of her minor daughters. Thus, no renunciation of right occurred.
2000[2] and July 17, 2003[3] of the Regional Trial Court of Makati City, Branch 138 in
Applying a liberal application of the rules, the trial court also rejected petitioners
SP Proc. Case No. 4549 denying petitioners motion to dismiss; and its May 25, 2004
objections on the certification against forum shopping.
Resolution[4] denying petitioners motion for reconsideration.

Petitioner moved for reconsideration but was denied. He filed a petition for certiorari
The facts are as follows:
before the Court of Appeals which affirmed the orders of the Regional Trial Court in its
assailed Decision dated January 22, 2004, the dispositive portion of which states:
On June 13, 1997, private respondent-minors Karen Oanes Wei and Kamille Oanes
Wei, represented by their mother Remedios Oanes (Remedios), filed a petition for
WHEREFORE, premises considered, the present petition is hereby DENIED DUE
letters of administration[5] before the Regional Trial Court of Makati City, Branch 138.
COURSE and accordingly DISMISSED, for lack of merit. Consequently, the assailed
The case was docketed as Sp. Proc. No. 4549 and entitled Intestate Estate of Sima
Orders dated July 21, 2000 and July 17, 2003 are hereby both AFFIRMED.
Wei (a.k.a. Rufino Guy Susim).
Respondent Judge is hereby DIRECTED to resolve the controversy over the
illegitimate filiation of the private respondents (sic) minors [-] Karen Oanes Wei and
Private respondents alleged that they are the duly acknowledged illegitimate children Kamille Oanes Wei who are claiming successional rights in the intestate estate of the
of Sima Wei, who died intestate in Makati City on October 29, 1992, leaving an estate deceased Sima Wei, a.k.a. Rufino Guy Susim.
valued at P10,000,000.00 consisting of real and personal properties. His known heirs
are his surviving spouse Shirley Guy and children, Emy, Jeanne, Cristina, George and
SO ORDERED.[10]
Michael, all surnamed Guy. Private respondents prayed for the appointment of a
regular administrator for the orderly settlement of Sima Weis estate. They likewise
prayed that, in the meantime, petitioner Michael C. Guy, son of the decedent, be The Court of Appeals denied petitioners motion for reconsideration, hence, this
appointed as Special Administrator of the estate. Attached to private respondents petition.
petition was a Certification Against Forum Shopping[6] signed by their counsel, Atty.
Sedfrey A. Ordoez.
Petitioner argues that the Court of Appeals disregarded existing rules on certification
against forum shopping; that the Release and Waiver of Claim executed by Remedios
In his Comment/Opposition,[7] petitioner prayed for the dismissal of the petition. He released and discharged the Guy family and the estate of Sima Wei from any claims
asserted that his deceased father left no debts and that his estate can be settled or liabilities; and that private respondents do not have the legal personality to institute
without securing letters of administration pursuant to Section 1, Rule 74 of the Rules the petition for letters of administration as they failed to prove their filiation during the
of Court. He further argued that private respondents should have established their lifetime of Sima Wei in accordance with Article 175 of the Family Code.
status as illegitimate children during the lifetime of Sima Wei pursuant to Article 175 of
the Family Code.
Private respondents contend that their counsels certification can be considered
substantial compliance with the rules on certification of non-forum shopping, and that
The other heirs of Sima Wei filed a Joint Motion to Dismiss[8] on the ground that the the petition raises no new issues to warrant the reversal of the decisions of the
certification against forum shopping should have been signed by private respondents Regional Trial Court and the Court of Appeals.
and not their counsel. They contended that Remedios should have executed the
certification on behalf of her minor daughters as mandated by Section 5, Rule 7 of the
The issues for resolution are: 1) whether private respondents petition should be
Rules of Court.
dismissed for failure to comply with the rules on certification of non-forum shopping; 2)
whether the Release and Waiver of Claim precludes private respondents from
In a Manifestation/Motion as Supplement to the Joint Motion to Dismiss,[9] petitioner claiming their successional rights; and 3) whether private respondents are barred by
and his co-heirs alleged that private respondents claim had been paid, waived, prescription from proving their filiation.
abandoned or otherwise extinguished by reason of Remedios June 7, 1993 Release
and Waiver of Claim stating that in exchange for the financial and educational
The petition lacks merit.
Rule 7, Section 5 of the Rules of Court provides that the certification of non-forum instant case is void and will not bar private respondents from asserting their rights as
shopping should be executed by the plaintiff or the principal party. Failure to comply heirs of the deceased.
with the requirement shall be cause for dismissal of the case. However, a liberal
application of the rules is proper where the higher interest of justice would be served.
Furthermore, it must be emphasized that waiver is the intentional relinquishment of a
In Sy Chin v. Court of Appeals,[11] we ruled that while a petition may have been
known right. Where one lacks knowledge of a right, there is no basis upon which
flawed where the certificate of non-forum shopping was signed only by counsel and
waiver of it can rest. Ignorance of a material fact negates waiver, and waiver cannot
not by the party, this procedural lapse may be overlooked in the interest of substantial
be established by a consent given under a mistake or misapprehension of fact.[17]
justice.[12] So it is in the present controversy where the merits[13] of the case and the
absence of an intention to violate the rules with impunity should be considered as
compelling reasons to temper the strict application of the rules. In the present case, private respondents could not have possibly waived their
successional rights because they are yet to prove their status as acknowledged
illegitimate children of the deceased. Petitioner himself has consistently denied that
As regards Remedios Release and Waiver of Claim, the same does not bar private
private respondents are his co-heirs. It would thus be inconsistent to rule that they
respondents from claiming successional rights. To be valid and effective, a waiver
waived their hereditary rights when petitioner claims that they do not have such right.
must be couched in clear and unequivocal terms which leave no doubt as to the
Hence, petitioners invocation of waiver on the part of private respondents must fail.
intention of a party to give up a right or benefit which legally pertains to him. A waiver
may not be attributed to a person when its terms do not explicitly and clearly evince an
intent to abandon a right.[14] Anent the issue on private respondents filiation, we agree with the Court of Appeals
that a ruling on the same would be premature considering that private respondents
have yet to present evidence. Before the Family Code took effect, the governing law
In this case, we find that there was no waiver of hereditary rights. The Release and
on actions for recognition of illegitimate children was Article 285 of the Civil Code, to
Waiver of Claim does not state with clarity the purpose of its execution. It merely
wit:
states that Remedios received P300,000.00 and an educational plan for her minor
daughters by way of financial assistance and in full settlement of any and all claims of
whatsoever nature and kind x x x against the estate of the late Rufino Guy Susim.[15] ART. 285. The action for the recognition of natural children may be brought only
Considering that the document did not specifically mention private respondents during the lifetime of the presumed parents, except in the following cases:
hereditary share in the estate of Sima Wei, it cannot be construed as a waiver of
successional rights.
(1) If the father or mother died during the minority of the child, in which case the latter
may file the action before the expiration of four years from the attainment of his
Moreover, even assuming that Remedios truly waived the hereditary rights of private majority;
respondents, such waiver will not bar the latters claim. Article 1044 of the Civil Code,
provides:
(2) If after the death of the father or of the mother a document should appear of which
nothing had been heard and in which either or both parents recognize the child.
ART. 1044. Any person having the free disposal of his property may accept or
repudiate an inheritance.
In this case, the action must be commenced within four years from the finding of the
document. (Emphasis supplied)
Any inheritance left to minors or incapacitated persons may be accepted by their
parents or guardians. Parents or guardians may repudiate the inheritance left to their
We ruled in Bernabe v. Alejo[18] that illegitimate children who were still minors at the
wards only by judicial authorization.
time the Family Code took effect and whose putative parent died during their minority
are given the right to seek recognition for a period of up to four years from attaining
The right to accept an inheritance left to the poor shall belong to the persons majority age. This vested right was not impaired or taken away by the passage of the
designated by the testator to determine the beneficiaries and distribute the property, or Family Code.[19]
in their default, to those mentioned in Article 1030. (Emphasis supplied)
On the other hand, Articles 172, 173 and 175 of the Family Code, which superseded
Parents and guardians may not therefore repudiate the inheritance of their wards Article 285 of the Civil Code, provide:
without judicial approval. This is because repudiation amounts to an alienation of
property[16] which must pass the courts scrutiny in order to protect the interest of the
ART. 172. The filiation of legitimate children is established by any of the following:
ward. Not having been judicially authorized, the Release and Waiver of Claim in the
(1) The record of birth appearing in the civil register or a final judgment; or compel recognition and the other to claim inheritance, may be joined in one complaint
is not new in our jurisprudence.[21] As held in Briz v. Briz:[22]
(2) An admission of legitimate filiation in a public document or a private handwritten
instrument and signed by the parent concerned. The question whether a person in the position of the present plaintiff can in any event
maintain a complex action to compel recognition as a natural child and at the same
time to obtain ulterior relief in the character of heir, is one which in the opinion of this
In the absence of the foregoing evidence, the legitimate filiation shall be proved by:
court must be answered in the affirmative, provided always that the conditions
justifying the joinder of the two distinct causes of action are present in the particular
(1) The open and continuous possession of the status of a legitimate child; or case. In other words, there is no absolute necessity requiring that the action to compel
acknowledgment should have been instituted and prosecuted to a successful
conclusion prior to the action in which that same plaintiff seeks additional relief in the
(2) Any other means allowed by the Rules of Court and special laws. character of heir. Certainly, there is nothing so peculiar to the action to compel
acknowledgment as to require that a rule should be here applied different from that
ART. 173. The action to claim legitimacy may be brought by the child during his or her generally applicable in other cases. x x x
lifetime and shall be transmitted to the heirs should the child die during minority or in a
state of insanity. In these cases, the heirs shall have a period of five years within The conclusion above stated, though not heretofore explicitly formulated by this court,
which to institute the action. is undoubtedly to some extent supported by our prior decisions. Thus, we have held in
numerous cases, and the doctrine must be considered well settled, that a natural child
The action already commenced by the child shall survive notwithstanding the death of having a right to compel acknowledgment, but who has not been in fact
either or both of the parties. acknowledged, may maintain partition proceedings for the division of the inheritance
against his coheirs (Siguiong vs. Siguiong, 8 Phil., 5; Tiamson vs. Tiamson, 32 Phil.,
62); and the same person may intervene in proceedings for the distribution of the
ART. 175. Illegitimate children may establish their illegitimate filiation in the same way estate of his deceased natural father, or mother (Capistrano vs. Fabella, 8 Phil., 135;
and on the same, evidence as legitimate children. Conde vs. Abaya, 13 Phil., 249; Ramirez vs. Gmur, 42 Phil., 855). In neither of these
situations has it been thought necessary for the plaintiff to show a prior decree
The action must be brought within the same period specified in Article 173, except compelling acknowledgment. The obvious reason is that in partition suits and
when the action is based on the second paragraph of Article 172, in which case the distribution proceedings the other persons who might take by inheritance are before
action may be brought during the lifetime of the alleged parent. the court; and the declaration of heirship is appropriate to such proceedings.

Under the Family Code, when filiation of an illegitimate child is established by a record WHEREFORE, the instant petition is DENIED. The Decision dated January 22, 2004
of birth appearing in the civil register or a final judgment, or an admission of filiation in of the Court of Appeals in CA-G.R. SP No. 79742 affirming the denial of petitioners
a public document or a private handwritten instrument signed by the parent motion to dismiss; and its Resolution dated May 25, 2004 denying petitioners motion
concerned, the action for recognition may be brought by the child during his or her for reconsideration, are AFFIRMED. Let the records be REMANDED to the Regional
lifetime. However, if the action is based upon open and continuous possession of the Trial Court of Makati City, Branch 138 for further proceedings.
status of an illegitimate child, or any other means allowed by the rules or special laws,
it may only be brought during the lifetime of the alleged parent. SO ORDERED.

It is clear therefore that the resolution of the issue of prescription depends on the type
of evidence to be adduced by private respondents in proving their filiation. However, it
would be impossible to determine the same in this case as there has been no
reception of evidence yet. This Court is not a trier of facts. Such matters may be
resolved only by the Regional Trial Court after a full-blown trial.

While the original action filed by private respondents was a petition for letters of
administration, the trial court is not precluded from receiving evidence on private
respondents filiation. Its jurisdiction extends to matters incidental and collateral to the
exercise of its recognized powers in handling the settlement of the estate, including
the determination of the status of each heir.[20] That the two causes of action, one to

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