[G.R. No. L-19064. January 31, 1964.

IN THE MATTER OF THE INTESTATE ESTATE of

PAZ E. SIGUION TORRES, deceased, ALBERTO S.
TORRES, Petitioner-Appellant, v. CONCHITA
TORRES and ANGEL S. TORRES, Oppositors-
Appellees .

SYLLABUS

1. ESTATES OF DECEASED PERSONS; SUMMARY SETTLEMENT; NO NECESSITY FOR

INSTITUTION OF SPECIAL PROCEEDINGS. — Where the decedent left no debts and the
heirs or legatees are all of age, there is no necessity for the institution of special
proceedings and the appointment of an administrator for the settlement of the estate,
because the same can be effected either extrajudicially or through an ordinary action
for partition.

2. ID.; ID.; UNVERIFIED ALLEGATION THAT ESTATE HAS EXISTING DEBT OR OTHER
PROPERTIES IN THE POSSESSION OF ONE OF THE HEIRS, ARE NOT SUFFICIENT
CAUSE FOR ADMINISTRATION PROCEEDINGS; CASE AT BAR — Facts: The heirs of the
deceased had already entered into an extrajudicial partition and settlement of the
estate, on the representation that there existed no debts, but one alleged heir petitions
to place the estate under his administration predicated mainly on alleged inability of the
heirs to agree on a physical division of the properties.

DECISION

BARRERA, J.:

In a petition filed in the Court of First Instance of Rizal (Pasay branch) on January 4,
1961, Alberto S. Torres, claiming to be one of the four legitimate children of Paz E.
Siguion Torres who died intestate on December 18, 1959, prayed for the issuance in his
favor of letters of administration in connection with the properties left by the decedent,
with an aggregate value of about P300,000.00. It was also alleged therein that
petitioner was unaware of any existing debt or obligation contracted by the deceased or
by her estate, from any of the heirs or from third persons.

This petition was opposed by Conchita Torres, one of the heirs, on the ground that the
appointment of an administrator is unnecessary in view of the fact that on January 27,
1960, the heirs of the deceased (including petitioner) had already entered into an
extrajudicial partition and settlement of the estate, pursuant to Section 1 of Rule 74 of
the Rules of Court. This was answered by petitioner who, while admitting that such
extrajudicial partition was signed by the heirs, contended that attempts at the actual
designation of their respective shares had failed thus needing the court’s intervention.
It was also claimed that some properties of considerable value were not included in said
extrajudicial partition. In a supplemental answer to the opposition, subsequently filed,
petitioner likewise alleged that the estate has an existing debt of P50,000.00 from third
persons, a fact which he claimed was not incorporated in the petition, through
oversight. Petitioner, however, offered to amend the petition before presentation of
evidence, with leave of court. On July 21, 1961, the court, finding that an extrajudicial
settlement had already been entered into by the heirs, dismissed the petition. Hence,
the institution of the present appeal.

Petitioner-appellant does not controvert the execution of an extrajudicial deed of

partition of the estate, which, according to appellee, contains the following
provisions:jgc:chanrobles.com.ph

"1. That they (Alberto, Angel, Eduardo and Conchita, all surnamed Torres) are the only
legitimate children who survive the deceased Paz Siguion Vda. de Torres;

x          x           x

"3. That the said decedent died without leaving any will and her only surviving heirs are
the aforementioned parties who are her legitimate children;

"4. That the deceased left no debts;

x          x           x

"6. That pursuant to Section 1, Rule 74 of the Rules of Court and in view of the
difficulty of making a physical division of the above properties, the parties have agreed
to settle the aforementioned estate by continuing the co-ownership on all the above
properties in the following proportion: chanrob1es virtual 1aw library

Alberto Torres — 1/4 undivided interest

Angel Torres — 1/4 undivided interest

Eduardo Torres — 1/4 undivided interest

Conchita Torres — 1/4 undivided interest" (Emphasis supplied).

It appears from the pleadings filed herein that the petition to place the estate under
administration was predicated mainly on the alleged inability of the heirs to agree on a
physical division of the properties. The alleged existence of an indebtedness and non-
inclusion in the list incorporated in the deed of extrajudicial partition, of certain
properties that form part of the estate, seemed to be merely an afterthought as the
reference to them was made only in the answer to the opposition and motion for
dismissal of the petition, and is not made under oath. There is also no allegation as to
the particulars of the debt and the omitted properties sufficient to identify them. In the
circumstances, we agree with the lower court that a special proceeding for the
settlement of the estate of the deceased is not here necessary.

Section 1, Rule 74 of the Rules of Court, provides: jgc:chanrobles.com.ph

"SECTION 1. Extra-judicial settlement by agreement between heirs. — If the decedent

left no debts and the heirs and legatees are all of age, or the minors are represented by
their judicial guardians, the parties may without securing letters of administration,
divide the estate among themselves as they see fit by means of a public instrument
filed in the office of the Register of Deeds, and should they disagree, they may do so in
an ordinary action of partition. If there is only one heir or one legatee, he may
adjudicate to himself the entire estate by means of an affidavit filed in the office of the
Register of Deeds. It shall be presumed that the decedent left no debt if no creditor
files a petition for letters of administration within two years after the death of the
decedent." cralaw virtua1aw library

Thus, where the decedent left no debts and heirs or legatees are all of age, as in this
case, there is no necessity for the institution of special proceedings and the
appointment of an administrator for the settlement of the estate, because the same can
be effected either extrajudicially or through an ordinary action for partition. (Guico, Et.
Al. v. Bautista, Et. Al. L-14921, December 31, 1960). If there is an actual necessity for
court intervention, as contended by appellant, in view of the heirs’ failure to reach an
agreement as to how the estate would be divided physically, the latter, under the
aforequoted Rule, have still the remedy of an ordinary action for partition.

This is not to overlook the allegation that the estate has an outstanding obligation of
P50,000.00. It is to be noted, however, that appellant, as heretofore observed, did not
specify from whom and in what manner the said debt was contracted. Indeed, the bare
allegation that "the estate has an existing debt of P50,000.00 from third persons"
cannot be considered a concise statement to constitute a cause of action. It must be for
this reason that the lower court, notwithstanding the existence of such averment in
appellant’s supplemental answer to the opposition, dismissed the petition filed by
said Appellant.

Nor does the unverified statement that there are other properties, not included in the
deed of extrajudicial partition in the possession of one of the heirs, justify the
institution of an administration proceeding because the same questions that may arise
as to them, viz. the title thereto, and their partition, if proven to belong to the
intestate, can be properly and expeditiously litigated in an ordinary action of partition.

WHEREFORE, finding no error in the order appealed from, the same is hereby affirmed,
with cost against the appellant. So ordered.

Bengzon, C.J., Padilla, Bautista Angelo, Labrador, Concepcion, Reyes, J.B.L., Paredes,

Dizon, Regala and Makalintal, JJ., concur.
G.R. No. 156536             October 31, 2006

JOSEPH CUA, petitioner, vs. GLORIA A. VARGAS, AURORA

VARGAS, RAMON VARGAS, MARITES VARGAS, EDELINA
VARGAS AND GEMMA VARGAS, respondents.

AZCUNA, J.:

This is a petition for review under Rule 45 of the Rules of Court seeking the reversal of the
decision1 dated March 26, 2002, and the resolution 2 dated December 17, 2002, of the Court of
Appeals in CA-G.R. SP No. 59869 entitled "Gloria A. Vargas, Aurora Vargas, Ramon Vargas,
Marites Vargas, Edelina Vargas and Gemma Vargas v. Joseph Cua."

The facts are as follows:

A parcel of residential land with an area of 99 square meters located in San Juan, Virac,
Catanduanes was left behind by the late Paulina Vargas. On February 4, 1994, a notarized Extra
Judicial Settlement Among Heirs was executed by and among Paulina Vargas' heirs, namely Ester
Vargas, Visitacion Vargas, Juan Vargas, Zenaida V. Matienzo, Rosario V. Forteza, Andres Vargas,
Gloria Vargas, Antonina Vargas and Florentino Vargas, partitioning and adjudicating unto
themselves the lot in question, each one of them getting a share of 11 square meters. Florentino,
Andres, Antonina and Gloria, however, did not sign the document. Only Ester, Visitacion, Juan,
Zenaida and Rosario signed it. The Extra Judicial Settlement Among Heirs was published in the
Catanduanes Tribune for three consecutive weeks. 3

On November 15, 1994, an Extra Judicial Settlement Among Heirs with Sale 4 was again executed by
and among the same heirs over the same property and also with the same sharings. Once more,
only Ester, Visitacion, Juan, Zenaida and Rosario signed the document and their respective shares
totaling 55 square meters were sold to Joseph Cua, petitioner herein.

According to Gloria Vargas, the widow of Santiago Vargas and one of respondents herein, she came
to know of the Extra Judicial Settlement Among Heirs with Sale dated November 16, 1994 only when
the original house built on the lot was being demolished sometime in May 1995. 5 She likewise
claimed she was unaware that an earlier Extra Judicial Settlement Among Heirs dated February 4,
1994 involving the same property had been published in the Catanduanes Tribune. 6

After knowing of the sale of the 55 square meters to petitioner, Gloria Vargas tried to redeem the
property, with the following letter7 sent to petitioner on her behalf:

29th June 1995

Mr. Joseph Cua

Capilihan, Virac, Catanduanes

Sir:
 This is in behalf of my client, Ms. Aurora Vargas,8 (c/o Atty. Prospero V. Tablizo) one of the
lawful heirs of the late Paulina Vargas, original owner of Lot No. 214 of Virac, Poblacion
covered by ARP No. 031-0031 in her name.

I understand that a document "Extra Judicial Settlement Among Heirs with Sale" was
executed by some of my client's co-heirs and alleged representatives of other co-heirs, by
virtue of which document you acquired by purchase from the signatories to the said
document, five (5) shares with a total area of fifty-five square meters of the above-described
land.

This is to serve you notice that my client shall exercise her right of legal redemption of said
five (5) shares as well as other shares which you may likewise have acquired by purchase.
And you are hereby given an option to agree to legal redemption within a period of fifteen
(15) days from your receipt hereof.

Should you fail to convey to me your agreement within said 15-day-period, proper legal
action shall be taken by my client to redeem said shares.

Thank you.

Very truly yours,

(Sgd.)
JUAN G. ATENCIA

When the offer to redeem was refused and after having failed to reach an amicable settlement at the
barangay level,9 Gloria Vargas filed a case for annulment of Extra Judicial Settlement and Legal
Redemption of the lot with the Municipal Trial Court (MTC) of Virac, Catanduanes against petitioner
and consigned the amount of P100,000 which is the amount of the purchase with the Clerk of Court
on May 20, 1996.10 Joining her in the action were her children with Santiago, namely, Aurora,
Ramon, Marites, Edelina and Gemma, all surnamed Vargas.

Subsequently, Carlos Gianan, Jr. and Gloria Arcilla, heirs of the alleged primitive owner of the lot in
question, Pedro Lakandula, intervened in the case. 11

Respondents claimed that as co-owners of the property, they may be subrogated to the rights of the
purchaser by reimbursing him the price of the sale. They likewise alleged that the 30-day period
following a written notice by the vendors to their co-owners for them to exercise the right of
redemption of the property had not yet set in as no written notice was sent to them. In effect, they
claimed that the Extra Judicial Settlement Among Heirs and the Extra Judicial Settlement Among
Heirs with Sale were null and void and had no legal and binding effect on them. 12

After trial on the merits, the MTC rendered a decision13 in favor of petitioner, dismissing the
complaint as well as the complaint-in-intervention for lack of merit, and declaring the Deed of Extra
Judicial Settlement Among Heirs with Sale valid and binding. The MTC upheld the sale to petitioner
because the transaction purportedly occurred after the partition of the property among the co-owner
heirs. The MTC opined that the other heirs could validly dispose of their respective shares.
Moreover, the MTC found that although there was a failure to strictly comply with the requirements
under Article 1088 of the Civil Code14 for a written notice of sale to be served upon respondents by
the vendors prior to the exercise of the former's right of redemption, this deficiency was cured by
respondents' actual knowledge of the sale, which was more than 30 days before the filing of their
complaint, and their consignation of the purchase price with the Clerk of Court, so that the latter
action came too late. Finally, the MTC ruled that respondents failed to establish by competent proof
petitioner's bad faith in purchasing the portion of the property owned by respondents' co-heirs. 15

On appeal, the Regional Trial Court (RTC), Branch 42, of Virac, Catanduanes affirmed the MTC
decision in a judgment dated November 25, 1999. The matter was thereafter raised to the Court of
Appeals (CA).

The CA reversed the ruling of both lower courts in the assailed decision dated March 26, 2002,
declaring that the Extra Judicial Settlement Among Heirs and the Extra Judicial Settlement Among
Heirs with Sale, dated February 4, 1994 and November 15, 1994, respectively, were void and
without any legal effect. The CA held that, pursuant to Section 1, Rule 74 of the Rules of Court, 16 the
extrajudicial settlement made by the other co-heirs is not binding upon respondents considering the
latter never participated in it nor did they ever signify their consent to the same.

His motion for reconsideration having been denied, petitioner filed the present petition for review.

The issues are:

Whether heirs are deemed constructively notified and bound, regardless of their failure to
participate therein, by an extrajudicial settlement and partition of estate when the
extrajudicial settlement and partition has been duly published; and,

Assuming a published extrajudicial settlement and partition does not bind persons who did
not participate therein, whether the written notice required to be served by an heir to his co-
heirs in connection with the sale of hereditary rights to a stranger before partition under
Article 1088 of the Civil Code17 can be dispensed with when such co-heirs have actual
knowledge of the sale such that the 30-day period within which a co-heir can exercise the
right to be subrogated to the rights of a purchaser shall commence from the date of actual
knowledge of the sale.

Petitioner argues, as follows:

Firstly, the acquisition by petitioner of the subject property subsequent to the extrajudicial partition
was valid because the partition was duly published. The publication of the same constitutes due
notice to respondents and signifies their implied acquiescence thereon. Respondents are therefore
estopped from denying the validity of the partition and sale at this late stage. Considering that the
partition was valid, respondents no longer have the right to redeem the property.

Secondly, petitioner is a possessor and builder in good faith.

Thirdly, the MTC had no jurisdiction over the complaint because its subject matter was incapable of
pecuniary estimation. The complaint should have been filed with the RTC.

Fourthly, there was a non-joinder of indispensable parties, the co-heirs who sold their interest in the
subject property not having been impleaded by respondents.

Fifthly, the appeal to the CA should have been dismissed as it was not properly verified by
respondents. Gloria Vargas failed to indicate that she was authorized to represent the other
respondents (petitioners therein) to initiate the petition. Moreover, the verification was inadequate
because it did not state the basis of the alleged truth and/or correctness of the material allegations in
the petition.

The petition lacks merit.

The procedure outlined in Section 1 of Rule 74 is an ex parte proceeding. The rule plainly states,
however, that persons who do not participate or had no notice of an extrajudicial settlement will not
be bound thereby.18 It contemplates a notice that has been sent out or issued before any deed of
settlement and/or partition is agreed upon (i.e., a notice calling all interested parties to participate in
the said deed of extrajudicial settlement and partition), and not after such an agreement has already
been executed19 as what happened in the instant case with the publication of the first deed of
extrajudicial settlement among heirs.

The publication of the settlement does not constitute constructive notice to the heirs who had no
knowledge or did not take part in it because the same was notice after the fact of execution. The
requirement of publication is geared for the protection of creditors and was never intended to deprive
heirs of their lawful participation in the decedent's estate. In this connection, the records of the
present case confirm that respondents never signed either of the settlement documents, having
discovered their existence only shortly before the filing of the present complaint. Following Rule 74,
these extrajudicial settlements do not bind respondents, and the partition made without their
knowledge and consent is invalid insofar as they are concerned.

This is not to say, though, that respondents' co-heirs cannot validly sell their hereditary rights to third
persons even before the partition of the estate. The heirs who actually participated in the execution
of the extrajudicial settlements, which included the sale to petitioner of their pro indiviso shares in
the subject property, are bound by the same. Nevertheless, respondents are given the right to
redeem these shares pursuant to Article 1088 of the Civil Code. The right to redeem was never lost
because respondents were never notified in writing of the actual sale by their co-heirs. Based on the
provision, there is a need for written notice to start the period of redemption, thus:

Should any of the heirs sell his hereditary rights to a stranger before the partition, any or all
of the co-heirs may be subrogated to the rights of the purchaser by reimbursing him for the
price of the sale, provided they do so within the period of one month from the time they
were notified in writing of the sale by the vendor. (Emphasis supplied.)

It bears emphasis that the period of one month shall be reckoned from the time that a co-heir is
notified in writing by the vendor of the actual sale. Written notice is indispensable and
mandatory,20 actual knowledge of the sale acquired in some other manner by the redemptioner
notwithstanding. It cannot be counted from the time advance notice is given of an impending or
contemplated sale. The law gives the co-heir thirty days from the time written notice of the actual
sale within which to make up his or her mind and decide to repurchase or effect the redemption. 21

Though the Code does not prescribe any particular form of written notice nor any distinctive method
for written notification of redemption, the method of notification remains exclusive, there being no
alternative provided by law.22 This proceeds from the very purpose of Article 1088, which is to keep
strangers to the family out of a joint ownership, if, as is often the case, the presence of outsiders be
undesirable and the other heir or heirs be willing and in a position to repurchase the share sold. 23

It should be kept in mind that the obligation to serve written notice devolves upon the vendor co-
heirs because the latter are in the best position to know the other co-owners who, under the law,
must be notified of the sale.24 This will remove all uncertainty as to the fact of the sale, its terms and
its perfection and validity, and quiet any doubt that the alienation is not definitive. 25 As a result, the
party notified need not entertain doubt that the seller may still contest the alienation. 26

Considering, therefore, that respondents' co-heirs failed to comply with this requirement, there is no
legal impediment to allowing respondents to redeem the shares sold to petitioner given the former's
obvious willingness and capacity to do so.

Likewise untenable is petitioner's contention that he is a builder in good faith. Good faith consists in
the belief of the builder that the land the latter is building on is one's own without knowledge of any
defect or flaw in one's title.27 Petitioner derived his title from the Extra Judicial Settlement Among
Heirs With Sale dated November 15, 1994. He was very much aware that not all of the heirs
participated therein as it was evident on the face of the document itself. Because the property had
not yet been partitioned in accordance with the Rules of Court, no particular portion of the property
could have been identified as yet and delineated as the object of the sale. This is because the
alienation made by respondents' co-heirs was limited to the portion which may be allotted to them in
the division upon the termination of the co-ownership. Despite this glaring fact, and over the protests
of respondents, petitioner still constructed improvements on the property. For this reason, his claim
of good faith lacks credence.

As to the issue of lack of jurisdiction, petitioner is estopped from raising the same for the first time on
appeal. Petitioner actively participated in the proceedings below and sought affirmative ruling from
the lower courts to uphold the validity of the sale to him of a portion of the subject property embodied
in the extrajudicial settlement among heirs. Having failed to seasonably raise this defense, he
cannot, under the peculiar circumstances of this case, be permitted to challenge the jurisdiction of
the lower court at this late stage. While it is a rule that a jurisdictional question may be raised at any
time, an exception arises where estoppel has already supervened.

Estoppel sets in when a party participates in all stages of a case before challenging the jurisdiction
of the lower court. One cannot belatedly reject or repudiate its decision after voluntarily submitting to
its jurisdiction, just to secure affirmative relief against one's opponent or after failing to obtain such
relief. The Court has, time and again, frowned upon the undesirable practice of a party submitting a
case for decision and then accepting the judgment, only if favorable, and attacking it for lack of
jurisdiction when adverse.28

Petitioner's fourth argument, that there is a non-joinder of indispensable parties, similarly lacks merit.
An indispensable party is a party-in-interest without whom there can be no final determination of an
action and who is required to be joined as either plaintiff or defendant. 29 The party's interest in the
subject matter of the suit and in the relief sought is so inextricably intertwined with the other parties
that the former's legal presence as a party to the proceeding is an absolute necessity. Hence, an
indispensable party is one whose interest will be directly affected by the court's action in the
litigation. In the absence of such indispensable party, there cannot be a resolution of the controversy
before the court which is effective, complete, or equitable. 30

In relation to this, it must be kept in mind that the complaint filed by respondents ultimately prayed
that they be allowed to redeem the shares in the property sold by their co-heirs. Significantly, the
right of the other heirs to sell their undivided share in the property to petitioner is not in dispute.
Respondents concede that the other heirs acted within their hereditary rights in doing so to the effect
that the latter completely and effectively relinquished their interests in the property in favor of
petitioner. Petitioner thus stepped into the shoes of the other heirs to become a co-owner of the
property with respondents. As a result, only petitioner's presence is absolutely required for a
complete and final determination of the controversy because what respondents seek is to be
subrogated to his rights as a purchaser.
Finally, petitioner contends that the petition filed by respondents with the CA should have been
dismissed because the verification and certificate of non-forum shopping appended to it were
defective, citing specifically the failure of respondent Gloria Vargas to: (1) indicate that she was
authorized to represent her co-respondents in the petition, and (2) state the basis of the alleged truth
of the allegations.

The general rule is that the certificate of non-forum shopping must be signed by all the plaintiffs or
petitioners in a case and the signature of only one of them is insufficient. 31 Nevertheless, the rules on
forum shopping, which were designed to promote and facilitate the orderly administration of justice,
should not be interpreted with such absolute literalness as to subvert their own ultimate and
legitimate objective. Strict compliance with the provisions regarding the certificate of non-forum
shopping merely underscores its mandatory nature in that the certification cannot be altogether
dispensed with or its requirements completely disregarded. 32 Under justifiable circumstances, the
Court has relaxed the rule requiring the submission of such certification considering that although it
is obligatory, it is not jurisdictional. 33

Thus, when all the petitioners share a common interest and invoke a common cause of action or
defense, the signature of only one of them in the certification against forum shopping substantially
complies with the rules.34 The co-respondents of respondent Gloria Vargas in this case were her
children. In order not to defeat the ends of justice, the Court deems it sufficient that she signed the
petition on their behalf and as their representative.

WHEREFORE, the petition is DENIED for lack of merit. Costs against petitioner.

SO ORDERED.
Neri vs Heirs of Hadji Yusop
Uy GR No 194366 10
October 2012
Facts: This case is a petition for review on certiorari by petitioners: Napoleon, Alicia,
Visminda, Rosa, Douglas, Eutropia, and Victoria seeking to reverse and set aside the
Decision of the CA which annulled the Decision of the RTC of Davao del Norte, and entered a
new one dismissing P’s complaint for annulment of sale and damages against herein
respondent.
During the lifetime of Ps’ mother, Anunciacion, she and her 2nd husband, Enrique, acquired
several homestead properties. When Anunciacion died, however, Enrique in his personal
capacity and as natural guardian of his minor children Rosa and Douglas, together with,
Napoleon, Alicia and Visminda executed an Extra-Judicial Settlement of the Estate with
Absolute Deed of Sale (1979) adjudicating among themselves the said homestead
properties, and thereafter, sold the properties to the late spouses Uy for a consideration of
80,000.
On 1996, the children of Enrique filed a complaint for annulment of the said sale against
spouses Uy, assailing the validity of the sale for having been sold within the prohibited
period. And, also, for having been executed without the consent or approval of Eutropia,
Victoria, Rosa and Douglas; thus, depriving the latter siblings of their legitime.

Uy countered that the sale took place beyond the 5 year prohibitory period from the
issuance of the homestead patents. They also denied that Eutropia and Victoria were
excluded from the Extra-judicial settlement and sale of the subject properties, and
interposed further the defense of prescription and laches.

RTC rendered a Decision annulling the Extra-judicial settlement of estate with Absolute
Deed of Sale. It ruled that the sale is void because Eutropia and Victoria were deprived of
their hereditary rights and that Enrique had no judicial authority to sell the shares of his
minor children, Rosa and Douglas.

On appeal, however, CA reserved and set aside RTC decision. Hence this appeal.
Issue: Whether Enrique, as guardian of his children and co-owner (with his children), sell
their co-owned property?
Decision: No, as to the shares of the minor children because as a natural guardian, he is
merely clothed with powers of administration.
Doctrine: Parents should apply for judicial guardianship in order for them to sell properties
of their children.

*Even the parents of their minor children are bound to post bond.*

With respect to Rosa and Douglas who were minors at the time of the execution of the
settlement and sale, their NATURAL GUARDIAN and father, Enrique, represented them in
the transaction. However, on the basis of the laws prevailing at that time, Enrique was
merely clothed with POWERS OF ADMINISTRATION and bereft of any authority to dispose of
their 2/16 shares in the estate of their mother, Anunciacion.

Power of dominion, is granted by law only to a JUDICIAL GUARDIAN of the ward’s property
and even then only with court’s prior approval secured in accordance with the proceedings
set forth by the Rules.

Exception: RATIFICATION
Consequently, the disputed sale entered into by Enrique in behalf of his minor children
without the proper judicial authority, unless ratified by them upon reaching the age of
majority, is unenforceable in accordance with Art. 1317 and 1403(1) of the Civil Code.

Records, however, show that Rosa had ratified the extrajudicial settlement of the estate
with absolute deed of sale.  The same, however, is not true with respect to Douglas for lack
of evidence showing ratification.

THEREFORE, the extrajudicial settlement with sale is invalid and not binding on Eutropia,
Victoria and Douglas. Consequently, spouses Uy or their substituted heirs became pro
indiviso co-owners of the homestead properties with Eutropia, Victoria and Douglas, who
retained title to their respective shares.
G.R. No. 211153

Amparo S. Cruz, et al. vs. Angelito S. Cruz,

et al.
February 28, 2018

Nature: Annulment of Extrajudicial Settlement

Facts: Angelito S. Cruz, Concepcion S. Cruz (.Concepcion), and Serafin S. Cruz. alleged that they -together
with h siblings, petitioner Amparo S. Cruz (Amparo) and Antonia Cruz inherited a 940-square-rneter
property from their late parents. The parties executed a deed of extrajudicial settlement of estate on
the agreement that each heir was to receive an equal portion of the property as mandated by law; that
in 1998, when the subject property being subdivided and the subdivision survey plan was shown to
respondents, they that Antonia was allocated two lots, as against one ( 1) each for the respondents; that
Antonia's allocation of two lots contravened the agreement among the heirs that they would receive
equal shares in the property; that Amparo and Antonia were able to perpetrate the fraud by inducing
Concepcion --who was illiterate -to sign the deed of extrajudicial settlement of estate, which was written
in the English language, without previously reading and explaining the contents to the latter.
Respondents respectfully prayed that the Extrajudicial Settlement be declared void. In their Answer,
petitioners prayed for the dismissal of extrajudicial settlement deed of extrajudicia1 settlement of estate
had been voluntarily and freely executed by the parties, free from vitiated consent; that respondents'
cause of action has prescribed; that the complaint failed to state a cause of action; and that no earnest
efforts toward compromise have been made. RTC dismissed the complaint. On appeal CA reversed RTCs
ruling, however.

Issue: Whether CA ignored the contemporaneous and subsequent acts of respondents indicating the
absence of fraud or vitiation of consent in the execution of the deed of extrajudicial settlement of the
estate of Felix Cruz.

Held: Yes. Jn short, this is a simple case of exc1usion in legal succession, where co-heirs were effectively
deprived of their rightful share to the estate of their parents -who died without a will-· by virtue of a
defective deed of extrajudicial settlement or pmtition which granted a bigger share to one of the heirs
and was prepared in such a way that the other heirs would be effectively deprived of discovering and
knowing its contents. Under the rule, 'no extra-judicial settlement shall be binding upon any person who
has not participated therein or had no notice thereof.' As the partition was a total nullity and did not
affect the excluded heirs, it was not correct for the trial court to hold that their right to challenge the
partition had prescribed after two years. Thus, while the CA was correct in mling in favor of Concepcion
and setting aside the subject deed of extrajudicial settlement, it erred in appreciating and mling that the
case involved fraud -thus applying the four-year presciiptive period -when it should have simply held
that the action for the declaration of nullity of the defective deed of extrajudicial settlement does not
prescribe, under the circumstances, given that the same was a total nullity. Clearly, the issue of literacy
is relevant to the extent that Concepcion was effectively deplived of her true inheritance, and not so
much that she was defrauded.

[G.R. No. L-11156. February 23, 1961.]

PURA CARREON, ET AL., Plaintiffs-Appellants, v. RUFO AGCAOILI

and LOURDES SANTIAGO, Defendants-Appellees.

SYLLABUS

1. SALE OF REGISTERED LANDS; GOOD FAITH; FRAUD NOT PRESUMED. — Where the
buyer of the land was an enlisted man in Philippine constabulary and seldom went
home to visit his relatives, the mere fact that he was a townmate of the vendor is not
sufficient basis to conclude that he knew that the latter had children by a first marriage.
Fraud cannot be presumed. It must be established by clear and sufficient evidence.

2. ID.; ID.; ID.; BUYER ONLY CHARGED WITH NOTICE OF BURDENS ON FACE OF
TITLE. — A buyer of land is not required to do more than rely on the title. He is only
charge with notice of the burdens which are noted on the face of the title.

DECISION

BAUTISTA ANGELO, J.:

During the marriage of Bonifacio Carreon and Celerina Dauag the registered land
subject of this case was acquired. After the death of Carreon, his widow Celerina
executed on September 24, 1946, an affidavit adjudicating to herself alone the said
land. She declared in said document that she was the only heiress of her husband. The
original certificate of titles covering the land was cancelled and a transfer certificate was
issued in her name. There was however annotated on her certificate a lien to the effect
that her title was subject to Section 4 of Rule 74 of the Rules of Court.

On September 25, 1946, she borrowed P1,200.00 from the Philippine National Bank
guaranteed by a mortgage on one-half of the land. A memorandum of the mortgage
was annotated on her transfer certificate. After the maturity of the loan, she requested
a certain Mr. Pintang to look for a buyer of the land for P3,000.00. One by the name of
Rufo Agcaoili was found. The latter made an advance payment of P1,500.00 and the
balance was paid in full on October 13, 1947. The loan from the bank was paid, the
mortgage was released, and the deed of absolute sale executed in his favor was
registered. 1 A new transfer certificate of title was issued in the name of Agcaoili.

On February 19, 1955, the children of Celerina with the deceased husband filed a
complaint against the spouses Agcaoili seeking to have the deed of sale executed by
their mother declared as one of mortgage and to recover one-half pro-indiviso of the
land described in the complaint. Simultaneous with the finding of said complaint,
Celerina filed an action for intervention which was dismissed by the trial court.

Defendants filed a motion for summary judgment upon the plea that the main
averments of the complaint even if admitted do not constitute a cause of action and
supported their plea with certain documentary evidence. Plaintiff’s filed an opposition
on the ground that there was a genuine issue which could not be determined unless a
trial is had. The trial court however allowed the parties to submit evidence in support of
their contentions and after a careful analysis thereof found for defendants holding that
plaintiffs’ claim has no legal basis.

As may be gleaned from the appellants’ assignments of error, the present appeal is
predicated on the arguments that appellees were buyers in bad faith; that there existed
a trust relationship between them and appellants; and that such being the case, the
action against appellees is imprescriptible.

There is no clear proof that when Rufo Agcaoili bought the land he knew of any flaw in
the title of Celerina Dauag. The mere fact that he was a townmate of Celerina is not
sufficient basis to conclude that he knew that she had children by her first husband. It
has been shown that since 1920 Rufo Agcaoili has been an enlisted man in the
Philippine constabulary and seldom went home to visit his relatives. A man of such a
situation cannot be expected to know the relatives and children of his vendor even if
they are townmates. Fraud cannot be presumed. It must be established by clear and
sufficient evidence. Here every indication is that Agcaoili bought the land in all good
faith oblivious of the source of its acquisition.

If fraud had been committed such was perpetrated by Celerina, appellants’ mother. By
her action she induced Agcaoili to believe that she was the absolute owner of the land
which bore a torrens title. In dealing with it he merely relied on such title. He was not
required to do more. He is only charged with notice of the burdens which are noted on
the face of said title. So after he bought the land and a new title was issued in his
name, he became a purchaser thereof for value and a holder of a good and valid title. 2

On the transfer certificate of title issued to Agcaoili there was annotated a statement
that it was subject to Section 4, Rule 74 of the Rules of Court. This was an annotation
carried over from Celerina’s transfer certificate. Section 4, Rule 74, provides the
following:jgc:chanrobles.com.ph

"SEC. 4. Liability of distributees and estate. — If it shall appear at any time within two
years after the settlement and distribution of an estate in accordance with the
provisions of either of the first two sections of this rule, that an heir or other person has
been unduly deprived of his lawful participation in the estate, such heir or such other
person may compel the settlement of the estate in the courts in the manner hereinafter
provided for the purpose of satisfying such lawful participation. And if within the same
time of two years, it shall appear that there are debts outstanding against the estate
which have not been paid, or that an heir or other person has been unduly deprived of
his lawful participation payable in money, the court having jurisdiction of the estate
may, by order for that purpose, after hearing, settle the amount of such debts or lawful
participation and order how much and in what manner each distributee shall contribute
in the payment thereof, and may issue execution, if circumstances require, against the
bond provided in the preceding section or against the real estate belonging to the
deceased, or both. Such bond and such real estate shall remain charged with a liability
to creditors, heirs or other persons for the full period of two years after such
distribution, notwithstanding any transfer of the real estate that may have been
made." cralaw virtua1aw library

The above lien is effective only for a period of two years. From September 28, 1946,
when a transfer certificate of title was issued to Celerina, to September 8, 1949 when
the deed of sale in favor of Agcaoili was issued and registered, more than two years
had elapsed. We sustain the lower court’s opinion that thenceforth the right to have
such lien cancelled became vested on appellee Agcaoili and that the same had became
functus oficio. 3 And there being no fraud in the transaction on the part of appellee, nor
proof that he knew of any legal infirmity in the title of his vendor, we find no reason to
apply the proposition that he is deemed to be holding the land in trust for the children
of Celerina Dauag.

WHEREFORE , the decision appealed from is affirmed, without pronouncement as to

costs.

Functus Officio is a Latin term meaning “having performed his or her office.”