G.R. No.

113725 June 29, 2000

JOHNNY S. RABADILLA,1 petitioner,
vs.
COURT OF APPEALS AND MARIA MARLENA2 COSCOLUELLA Y BELLEZA VILLACARLOS, respondents.
DECISION
PURISIMA, J.:
This is a petition for review of the decision of the Court of Appeals, 3 dated December 23, 1993, in CA-G.R. No. CV-35555, which set aside the
decision of Branch 52 of the Regional Trial Court in Bacolod City, and ordered the defendants-appellees (including herein petitioner), as heirs of Dr.
Jorge Rabadilla, to reconvey title over Lot No. 1392, together with its fruits and interests, to the estate of Aleja Belleza.
The antecedent facts are as follows:
In a Codicil appended to the Last Will and Testament of testatrix Aleja Belleza, Dr. Jorge Rabadilla, predecessor-in-interest of the herein petitioner,
Johnny S. Rabadilla, was instituted as a devisee of 511, 855 square meters of that parcel of land surveyed as Lot No. 1392 of the Bacolod Cadastre.
The said Codicil, which was duly probated and admitted in Special Proceedings No. 4046 before the then Court of First Instance of Negros
Occidental, contained the following provisions:
"FIRST
I give, leave and bequeath the following property owned by me to Dr. Jorge Rabadilla resident of 141 P. Villanueva, Pasay City:
(a) Lot No. 1392 of the Bacolod Cadastre, covered by Transfer Certificate of Title No. RT-4002 (10942), which is registered in my name
according to the records of the Register of Deeds of Negros Occidental.
(b) That should Jorge Rabadilla die ahead of me, the aforementioned property and the rights which I shall set forth hereinbelow, shall be
inherited and acknowledged by the children and spouse of Jorge Rabadilla.
xxx
FOURTH
(a)....It is also my command, in this my addition (Codicil), that should I die and Jorge Rabadilla shall have already received the ownership of the said
Lot No. 1392 of the Bacolod Cadastre, covered by Transfer Certificate of Title No. RT-4002 (10942), and also at the time that the lease of Balbinito
G. Guanzon of the said lot shall expire, Jorge Rabadilla shall have the obligation until he dies, every year to give to Maria Marlina Coscolluela y
Belleza, Seventy (75) (sic) piculs of Export sugar and Twenty Five (25) piculs of Domestic sugar, until the said Maria Marlina Coscolluela y Belleza
dies.
FIFTH
(a) Should Jorge Rabadilla die, his heir to whom he shall give Lot No. 1392 of the Bacolod Cadastre, covered by Transfer Certificate of Title No. RT-
4002 (10492), shall have the obligation to still give yearly, the sugar as specified in the Fourth paragraph of his testament, to Maria Marlina
Coscolluela y Belleza on the month of December of each year.
SIXTH
I command, in this my addition (Codicil) that the Lot No. 1392, in the event that the one to whom I have left and bequeathed, and his heir shall later
sell, lease, mortgage this said Lot, the buyer, lessee, mortgagee, shall have also the obligation to respect and deliver yearly ONE HUNDRED (100)
piculs of sugar to Maria Marlina Coscolluela y Belleza, on each month of December, SEVENTY FIVE (75) piculs of Export and TWENTY FIVE
(25) piculs of Domestic, until Maria Marlina shall die, lastly should the buyer, lessee or the mortgagee of this lot, not have respected my command in
this my addition (Codicil), Maria Marlina Coscolluela y Belleza, shall immediately seize this Lot No. 1392 from my heir and the latter's heirs, and
shall turn it over to my near desendants, (sic) and the latter shall then have the obligation to give the ONE HUNDRED (100) piculs of sugar until
Maria Marlina shall die. I further command in this my addition (Codicil) that my heir and his heirs of this Lot No. 1392, that they will obey and
follow that should they decide to sell, lease, mortgage, they cannot negotiate with others than my near descendants and my sister." 4
Pursuant to the same Codicil, Lot No. 1392 was transferred to the deceased, Dr. Jorge Rabadilla, and Transfer Certificate of Title No. 44498 thereto
issued in his name.
Dr. Jorge Rabadilla died in 1983 and was survived by his wife Rufina and children Johnny (petitioner), Aurora, Ofelia and Zenaida, all surnamed
Rabadilla.
On August 21, 1989, Maria Marlena Coscolluela y Belleza Villacarlos brought a complaint, docketed as Civil Case No. 5588, before Branch 52 of the
Regional Trial Court in Bacolod City, against the above-mentioned heirs of Dr. Jorge Rabadilla, to enforce the provisions of subject Codicil. The
Complaint alleged that the defendant-heirs violated the conditions of the Codicil, in that:
1. Lot No. 1392 was mortgaged to the Philippine National Bank and the Republic Planters Bank in disregard of the testatrix's specific
instruction to sell, lease, or mortgage only to the near descendants and sister of the testatrix.
2. Defendant-heirs failed to comply with their obligation to deliver one hundred (100) piculs of sugar (75 piculs export sugar and 25 piculs
domestic sugar) to plaintiff Maria Marlena Coscolluela y Belleza from sugar crop years 1985 up to the filing of the complaint as mandated
by the Codicil, despite repeated demands for compliance.
3. The banks failed to comply with the 6th paragraph of the Codicil which provided that in case of the sale, lease, or mortgage of the
property, the buyer, lessee, or mortgagee shall likewise have the obligation to deliver 100 piculs of sugar per crop year to herein private
respondent.
The plaintiff then prayed that judgment be rendered ordering defendant-heirs to reconvey/return-Lot No. 1392 to the surviving heirs of the late Aleja
Belleza, the cancellation of TCT No. 44498 in the name of the deceased, Dr. Jorge Rabadilla, and the issuance of a new certificate of title in the
names of the surviving heirs of the late Aleja Belleza.
On February 26, 1990, the defendant-heirs were declared in default but on March 28, 1990 the Order of Default was lifted, with respect to defendant
Johnny S. Rabadilla, who filed his Answer, accordingly.
During the pre-trial, the parties admitted that:
On November 15, 1998, the plaintiff (private respondent) and a certain Alan Azurin, son-in-law of the herein petitioner who was lessee of the
property and acting as attorney-in-fact of defendant-heirs, arrived at an amicable settlement and entered into a Memorandum of Agreement on the
obligation to deliver one hundred piculs of sugar, to the following effect:
"That for crop year 1988-89, the annuity mentioned in Entry No. 49074 of TCT No. 44489 will be delivered not later than January of 1989, more
specifically, to wit:
75 piculs of 'A' sugar, and 25 piculs of 'B' sugar, or then existing in any of our names, Mary Rose Rabadilla y Azurin or Alan Azurin, during
December of each sugar crop year, in Azucar Sugar Central; and, this is considered compliance of the annuity as mentioned, and in the same manner
will compliance of the annuity be in the next succeeding crop years.
That the annuity above stated for crop year 1985-86, 1986-87, and 1987-88, will be complied in cash equivalent of the number of piculs as mentioned
therein and which is as herein agreed upon, taking into consideration the composite price of sugar during each sugar crop year, which is in the total
amount of ONE HUNDRED FIVE THOUSAND PESOS (P105,000.00).
That the above-mentioned amount will be paid or delivered on a staggered cash installment, payable on or before the end of December of every sugar
crop year, to wit:
For 1985-86, TWENTY SIX THOUSAND TWO HUNDRED FIFTY (P26,250.00) Pesos, payable on or before December of crop year 1988-89;
For 1986-87, TWENTY SIX THOUSAND TWO HUNDRED FIFTY (P26,250.00) Pesos, payable on or before December of crop year 1989-90;
For 1987-88, TWENTY SIX THOUSAND TWO HUNDRED FIFTY (P26,250.00) Pesos, payable on or before December of crop year 1990-91; and
For 1988-89, TWENTY SIX THOUSAND TWO HUNDRED FIFTY (P26,250.00) Pesos, payable on or before December of crop year 1991-92." 5
However, there was no compliance with the aforesaid Memorandum of Agreement except for a partial delivery of 50.80 piculs of sugar
corresponding to sugar crop year 1988 -1989.
On July 22, 1991, the Regional Trial Court came out with a decision, dismissing the complaint and disposing as follows:
"WHEREFORE, in the light of the aforegoing findings, the Court finds that the action is prematurely filed as no cause of action against the
defendants has as yet arose in favor of plaintiff. While there maybe the non-performance of the command as mandated exaction from them simply
because they are the children of Jorge Rabadilla, the title holder/owner of the lot in question, does not warrant the filing of the present complaint. The
remedy at bar must fall. Incidentally, being in the category as creditor of the left estate, it is opined that plaintiff may initiate the intestate
proceedings, if only to establish the heirs of Jorge Rabadilla and in order to give full meaning and semblance to her claim under the Codicil.
In the light of the aforegoing findings, the Complaint being prematurely filed is DISMISSED without prejudice.
SO ORDERED."6
On appeal by plaintiff, the First Division of the Court of Appeals reversed the decision of the trial court; ratiocinating and ordering thus:
"Therefore, the evidence on record having established plaintiff-appellant's right to receive 100 piculs of sugar annually out of the produce of Lot No.
1392; defendants-appellee's obligation under Aleja Belleza's codicil, as heirs of the modal heir, Jorge Rabadilla, to deliver such amount of sugar to
plaintiff-appellant; defendants-appellee's admitted non-compliance with said obligation since 1985; and, the punitive consequences enjoined by both
the codicil and the Civil Code, of seizure of Lot No. 1392 and its reversion to the estate of Aleja Belleza in case of such non-compliance, this Court
deems it proper to order the reconveyance of title over Lot No. 1392 from the estates of Jorge Rabadilla to the estate of Aleja Belleza. However,
plaintiff-appellant must institute separate proceedings to re-open Aleja Belleza's estate, secure the appointment of an administrator, and distribute Lot
No. 1392 to Aleja Belleza's legal heirs in order to enforce her right, reserved to her by the codicil, to receive her legacy of 100 piculs of sugar per
year out of the produce of Lot No. 1392 until she dies.
Accordingly, the decision appealed from is SET ASIDE and another one entered ordering defendants-appellees, as heirs of Jorge Rabadilla, to
reconvey title over Lot No. 1392, together with its fruits and interests, to the estate of Aleja Belleza.
SO ORDERED."7
Dissatisfied with the aforesaid disposition by the Court of Appeals, petitioner found his way to this Court via the present petition, contending that the
Court of Appeals erred in ordering the reversion of Lot 1392 to the estate of the testatrix Aleja Belleza on the basis of paragraph 6 of the Codicil, and
in ruling that the testamentary institution of Dr. Jorge Rabadilla is a modal institution within the purview of Article 882 of the New Civil Code.
The petition is not impressed with merit.
Petitioner contends that the Court of Appeals erred in resolving the appeal in accordance with Article 882 of the New Civil Code on modal
institutions and in deviating from the sole issue raised which is the absence or prematurity of the cause of action. Petitioner maintains that Article 882
does not find application as there was no modal institution and the testatrix intended a mere simple substitution - i.e. the instituted heir, Dr. Jorge
Rabadilla, was to be substituted by the testatrix's "near descendants" should the obligation to deliver the fruits to herein private respondent be not
complied with. And since the testatrix died single and without issue, there can be no valid substitution and such testamentary provision cannot be
given any effect.
The petitioner theorizes further that there can be no valid substitution for the reason that the substituted heirs are not definite, as the substituted heirs
are merely referred to as "near descendants" without a definite identity or reference as to who are the "near descendants" and therefore, under Articles
8438 and 8459 of the New Civil Code, the substitution should be deemed as not written.
The contentions of petitioner are untenable. Contrary to his supposition that the Court of Appeals deviated from the issue posed before it, which was
the propriety of the dismissal of the complaint on the ground of prematurity of cause of action, there was no such deviation. The Court of Appeals
found that the private respondent had a cause of action against the petitioner. The disquisition made on modal institution was, precisely, to stress that
the private respondent had a legally demandable right against the petitioner pursuant to subject Codicil; on which issue the Court of Appeals ruled in
accordance with law.
It is a general rule under the law on succession that successional rights are transmitted from the moment of death of the decedent 10 and compulsory
heirs are called to succeed by operation of law. The legitimate children and descendants, in relation to their legitimate parents, and the widow or
widower, are compulsory heirs.11 Thus, the petitioner, his mother and sisters, as compulsory heirs of the instituted heir, Dr. Jorge Rabadilla, succeeded
the latter by operation of law, without need of further proceedings, and the successional rights were transmitted to them from the moment of death of
the decedent, Dr. Jorge Rabadilla.
Under Article 776 of the New Civil Code, inheritance includes all the property, rights and obligations of a person, not extinguished by his death.
Conformably, whatever rights Dr. Jorge Rabadilla had by virtue of subject Codicil were transmitted to his forced heirs, at the time of his death. And
since obligations not extinguished by death also form part of the estate of the decedent; corollarily, the obligations imposed by the Codicil on the
deceased Dr. Jorge Rabadilla, were likewise transmitted to his compulsory heirs upon his death.
In the said Codicil, testatrix Aleja Belleza devised Lot No. 1392 to Dr. Jorge Rabadilla, subject to the condition that the usufruct thereof would be
delivered to the herein private respondent every year. Upon the death of Dr. Jorge Rabadilla, his compulsory heirs succeeded to his rights and title
over the said property, and they also assumed his (decedent's) obligation to deliver the fruits of the lot involved to herein private respondent. Such
obligation of the instituted heir reciprocally corresponds to the right of private respondent over the usufruct, the fulfillment or performance of which
is now being demanded by the latter through the institution of the case at bar. Therefore, private respondent has a cause of action against petitioner
and the trial court erred in dismissing the complaint below.
Petitioner also theorizes that Article 882 of the New Civil Code on modal institutions is not applicable because what the testatrix intended was a
substitution - Dr. Jorge Rabadilla was to be substituted by the testatrix's near descendants should there be noncompliance with the obligation to
deliver the piculs of sugar to private respondent.
Again, the contention is without merit.
Substitution is the designation by the testator of a person or persons to take the place of the heir or heirs first instituted. Under substitutions in
general, the testator may either (1) provide for the designation of another heir to whom the property shall pass in case the original heir should die
before him/her, renounce the inheritance or be incapacitated to inherit, as in a simple substitution, 12 or (2) leave his/her property to one person with
the express charge that it be transmitted subsequently to another or others, as in a fideicommissary substitution. 13 The Codicil sued upon contemplates
neither of the two.
In simple substitutions, the second heir takes the inheritance in default of the first heir by reason of incapacity, predecease or renunciation. 14 In the
case under consideration, the provisions of subject Codicil do not provide that should Dr. Jorge Rabadilla default due to predecease, incapacity or
renunciation, the testatrix's near descendants would substitute him. What the Codicil provides is that, should Dr. Jorge Rabadilla or his heirs not
fulfill the conditions imposed in the Codicil, the property referred to shall be seized and turned over to the testatrix's near descendants.
Neither is there a fideicommissary substitution here and on this point, petitioner is correct. In a fideicommissary substitution, the first heir is strictly
mandated to preserve the property and to transmit the same later to the second heir.15 In the case under consideration, the instituted heir is in fact
allowed under the Codicil to alienate the property provided the negotiation is with the near descendants or the sister of the testatrix. Thus, a very
important element of a fideicommissary substitution is lacking; the obligation clearly imposing upon the first heir the preservation of the property and
its transmission to the second heir. "Without this obligation to preserve clearly imposed by the testator in his will, there is no fideicommissary
substitution."16 Also, the near descendants' right to inherit from the testatrix is not definite. The property will only pass to them should Dr. Jorge
Rabadilla or his heirs not fulfill the obligation to deliver part of the usufruct to private respondent.
Another important element of a fideicommissary substitution is also missing here. Under Article 863, the second heir or the fideicommissary to
whom the property is transmitted must not be beyond one degree from the first heir or the fiduciary. A fideicommissary substitution is therefore, void
if the first heir is not related by first degree to the second heir. 17 In the case under scrutiny, the near descendants are not at all related to the instituted
heir, Dr. Jorge Rabadilla.
The Court of Appeals erred not in ruling that the institution of Dr. Jorge Rabadilla under subject Codicil is in the nature of a modal institution and
therefore, Article 882 of the New Civil Code is the provision of law in point. Articles 882 and 883 of the New Civil Code provide:
Art. 882. The statement of the object of the institution or the application of the property left by the testator, or the charge imposed on him, shall not be
considered as a condition unless it appears that such was his intention.
That which has been left in this manner may be claimed at once provided that the instituted heir or his heirs give security for compliance with the
wishes of the testator and for the return of anything he or they may receive, together with its fruits and interests, if he or they should disregard this
obligation.
Art. 883. When without the fault of the heir, an institution referred to in the preceding article cannot take effect in the exact manner stated by the
testator, it shall be complied with in a manner most analogous to and in conformity with his wishes.
The institution of an heir in the manner prescribed in Article 882 is what is known in the law of succession as aninstitucion sub modo or a modal
institution. In a modal institution, the testator states (1) the object of the institution, (2) the purpose or application of the property left by the testator,
or (3) the charge imposed by the testator upon the heir. 18 A "mode" imposes an obligation upon the heir or legatee but it does not affect the efficacy of
his rights to the succession.19 On the other hand, in a conditional testamentary disposition, the condition must happen or be fulfilled in order for the
heir to be entitled to succeed the testator. The condition suspends but does not obligate; and the mode obligates but does not suspend. 20 To some
extent, it is similar to a resolutory condition. 21
From the provisions of the Codicil litigated upon, it can be gleaned unerringly that the testatrix intended that subject property be inherited by Dr.
Jorge Rabadilla. It is likewise clearly worded that the testatrix imposed an obligation on the said instituted heir and his successors-in-interest to
deliver one hundred piculs of sugar to the herein private respondent, Marlena Coscolluela Belleza, during the lifetime of the latter. However, the
testatrix did not make Dr. Jorge Rabadilla's inheritance and the effectivity of his institution as a devisee, dependent on the performance of the said
obligation. It is clear, though, that should the obligation be not complied with, the property shall be turned over to the testatrix's near descendants.
The manner of institution of Dr. Jorge Rabadilla under subject Codicil is evidently modal in nature because it imposes a charge upon the instituted
heir without, however, affecting the efficacy of such institution.
Then too, since testamentary dispositions are generally acts of liberality, an obligation imposed upon the heir should not be considered a condition
unless it clearly appears from the Will itself that such was the intention of the testator. In case of doubt, the institution should be considered as modal
and not conditional.22
Neither is there tenability in the other contention of petitioner that the private respondent has only a right of usufruct but not the right to seize the
property itself from the instituted heir because the right to seize was expressly limited to violations by the buyer, lessee or mortgagee.
In the interpretation of Wills, when an uncertainty arises on the face of the Will, as to the application of any of its provisions, the testator's intention is
to be ascertained from the words of the Will, taking into consideration the circumstances under which it was made. 23 Such construction as will sustain
and uphold the Will in all its parts must be adopted. 24
Subject Codicil provides that the instituted heir is under obligation to deliver One Hundred (100) piculs of sugar yearly to Marlena Belleza Coscuella.
Such obligation is imposed on the instituted heir, Dr. Jorge Rabadilla, his heirs, and their buyer, lessee, or mortgagee should they sell, lease, mortgage
or otherwise negotiate the property involved. The Codicil further provides that in the event that the obligation to deliver the sugar is not respected,
Marlena Belleza Coscuella shall seize the property and turn it over to the testatrix's near descendants. The non-performance of the said obligation is
thus with the sanction of seizure of the property and reversion thereof to the testatrix's near descendants. Since the said obligation is clearly imposed
by the testatrix, not only on the instituted heir but also on his successors-in-interest, the sanction imposed by the testatrix in case of non-fulfillment of
said obligation should equally apply to the instituted heir and his successors-in-interest.
Similarly unsustainable is petitioner's submission that by virtue of the amicable settlement, the said obligation imposed by the Codicil has been
assumed by the lessee, and whatever obligation petitioner had become the obligation of the lessee; that petitioner is deemed to have made a
substantial and constructive compliance of his obligation through the consummated settlement between the lessee and the private respondent, and
having consummated a settlement with the petitioner, the recourse of the private respondent is the fulfillment of the obligation under the amicable
settlement and not the seizure of subject property.
Suffice it to state that a Will is a personal, solemn, revocable and free act by which a person disposes of his property, to take effect after his
death.25 Since the Will expresses the manner in which a person intends how his properties be disposed, the wishes and desires of the testator must be
strictly followed. Thus, a Will cannot be the subject of a compromise agreement which would thereby defeat the very purpose of making a Will.
WHEREFORE, the petition is hereby DISMISSED and the decision of the Court of Appeals, dated December 23, 1993, in CA-G.R. No. CV-35555
AFFIRMED. No pronouncement as to costs
SO ORDERED.
FACTS: In a Codicil appended to the Last Will and Testament of testatrix Aleja Belleza, Dr. Jorge Rabadilla, predecessor-in-interest of the herein petitioner, Johnny S.
Rabadilla, was instituted as a devisee of parcel of land. The Codicil provides that Jorge Rabadilla shall have the obligation until he dies, every year to give Maria
Marlina Coscolluela y Belleza, (75) (sic) piculs of Export sugar and (25) piculs of Domestic sugar, until the said Maria Marlina Coscolluela y Belleza dies. Dr. Jorge
Rabadilla died. Private respondent brought a complaint, to enforce the provisions of subject Codicil.

ISSUE:WON the obligations of Jorge Rabadilla under the Codicil are inherited by his heirs.

HELD: Under Article 776 of the NCC, inheritance includes all the property, rights and obligations of a person, not extinguished by his death. Conformably, whatever
rights Dr. Jorge Rabadilla had by virtue of subject Codicil were transmitted to his forced heirs, at the time of his death. And since obligations not extinguished by death
also form part of the estate of the decedent; corollarily, the obligations imposed by the Codicil on the deceased Dr. Jorge Rabadilla, were likewise transmitted to his
compulsory heirs upon his death.

A certain Aleja Belleza died but he instituted in his will Dr. Jorge Rabadilla as a devisee to a 511, 855 hectare land. A condition was however imposed to the effect that:
1. the naked ownership shall transfer to Dr. Rabadilla;
2. he shall deliver the fruits of said land to Maria Belleza, sister of Aleja, during the lifetime of said Maria Belleza;
3. that in case Dr. Rabadilla shall die before Maria Belleza, the near descendants, shall continue delivering the fruits to Maria Belleza;
4. that the said land may only be encumbered, mortgaged, or sold only to a relative of Belleza.
In 1983, Dr. Rabadilla died. He was survived by Johnny Rabadilla.
In 1989, Maria Belleza sued Johnny Rabadilla in order to compel Johnny to reconvey the said land to the estate of Aleja Belleza because it is alleged that Johnny failed
to comply with the terms of the will; that since 1985, Johnny failed to deliver the fruits; and that the the land was mortgaged to the Philippine National Bank, which is a
violation of the will.
In his defense, Johnny avers that the term near descendants in the will of Aleja pertains to the near descendants of Aleja and not to the near descendants of Dr.
Rabadilla, hence, since Aleja had no near descendants at the time of his death, no can substitute Dr. Rabadilla on the obligation to deliver the fruits of the devised land.
ISSUE: Whether or not Johnny Rabadilla is not obliged to comply with the terms of the Will left by Aleja Belleza.
HELD: No. The contention of Johnny Rabadilla is bereft of merit. The near descendants being referred to in the will are the heirs of Dr. Rabadilla. Ownership over
the devised property was already transferred to Dr. Rabadilla when Aleja died. Hence, when Dr. Rabadilla himself died, ownership over the same property was
transmitted to Johnny Rabadilla by virtue of succession.
Under Article 776 of the Civil Code, inheritance includes all the property, rights and obligations of a person, not extinguished by his death. Conformably, whatever
rights Dr. Rabadilla had by virtue of the Will were transmitted to his forced heirs, at the time of his death. And since obligations not extinguished by death also form
part of the estate of the decedent; corollarily, the obligations imposed by the Will on the deceased Dr. Jorge Rabadilla, were likewise transmitted to his compulsory heirs
upon his death. It is clear therefore, that Johnny should have continued complying with the terms of the Will. His failure to do so shall give rise to an obligation for him
to reconvey the property to the estate of Aleja.

G.R. No. 89783 February 19, 1992

MARIANO B. LOCSIN, JULIAN J. LOCSIN, JOSE B. LOCSIN, AUREA B. LOCSIN, MATILDE L. CORDERO, SALVADOR B. LOCSIN
and MANUEL V. DEL ROSARIO, petitioners,
vs.
THE HON. COURT OF APPEALS, JOSE JAUCIAN, FLORENTINO JAUCIAN, MERCEDES JAUCIAN ARBOLEDA, HEIRS OF
JOSEFINA J. BORJA, HEIRS OF EDUARDO JAUCIAN and HEIRS OF VICENTE JAUCIAN, respondents.
Aytona Law Office and Siquia Law Offices for petitioners.
Mabella, Sangil & Associates for private respondents.

NARVASA, C.J.:
Reversal of the decision of the Court of Appeals in CA-G.R. No. CV-11186 affirming with modification the judgment of the Regional Trial Court
of Albay in favor of the plaintiffs in Civil Case No. 7152 entitled "Jose Jaucian, et al. v. Mariano B. Locsin, et al.," an action for recovery of real
property with damages is sought. in these proceedings initiated by petition for review on certiorari in accordance with Rule 45 of the Rules of
Court.
The petition was initially denied due course and dismissed by this Court. It was however reinstated upon a second motion for reconsideration filed by
the petitioners, and the respondents were required to comment thereon. The petition was thereafter given due course and the parties were directed to
submit their memorandums. These, together with the evidence, having been carefully considered, the Court now decides the case.
First, the facts as the Court sees them in light of the evidence on record:
The late Getulio Locsin had three children named Mariano, Julian and Magdalena, all surnamed Locsin. He owned extensive residential and
agricultural properties in the provinces of Albay and Sorsogon. After his death, his estate was divided among his three (3) children as follows:
(a) the coconut lands of some 700 hectares in Bual, Pilar, Sorsogon, were adjudicated to his daughter, Magdalena Locsin;
(b) 106 hectares of coconut lands were given to Julian Locsin, father of the petitioners Julian, Mariano, Jose, Salvador, Matilde, and Aurea, all
surnamed Locsin;
(c) more than forty (40) hectares of coconut lands in Bogtong, eighteen (18) hectares of riceland in Daraga, and the residential lots in Daraga, Albay
and in Legazpi City went to his son Mariano, which Mariano brought into his marriage to Catalina Jaucian in 1908. Catalina, for her part, brought
into the marriage untitled properties which she had inherited from her parents, Balbino Jaucian and Simona Anson. These were augmented by other
properties acquired by the spouses in the course of their union, 1 which however was not blessed with children.
Eventually, the properties of Mariano and Catalina were brought under the Torrens System. Those that Mariano inherited from his father, Getulio
Locsin, were surveyed cadastrally and registered in the name of "Mariano Locsin, married to Catalina Jaucian.'' 2
Mariano Locsin executed a Last Will and Testament instituting his wife, Catalina, as the sole and universal heir of all his properties. 3 The will was
drawn up by his wife's nephew and trusted legal adviser, Attorney Salvador Lorayes. Attorney Lorayes disclosed that the spouses being childless,
they had agreed that their properties, after both of them shall have died should revert to their respective sides of the family, i.e., Mariano's properties
would go to his "Locsin relatives" (i.e., brothers and sisters or nephews and nieces), and those of Catalina to her "Jaucian relatives." 4
Don Mariano Locsin died of cancer on September 14, 1948 after a lingering illness. In due time, his will was probated in Special Proceedings No.
138, CFI of Albay without any opposition from both sides of the family. As directed in his will, Doa Catalina was appointed executrix of his estate.
Her lawyer in the probate proceeding was Attorney Lorayes. In the inventory of her husband's estate 5 which she submitted to the probate court for
approval, 6Catalina declared that "all items mentioned from Nos. 1 to 33 are the private properties of the deceased and form part of his capital at the
time of the marriage with the surviving spouse, while items Nos. 34 to 42 are conjugal." 7
Among her own and Don Mariano's relatives, Doa Catalina was closest to her nephew, Attorney Salvador Lorayes, her nieces, Elena Jaucian, Maria
Lorayes-Cornelio and Maria Olbes-Velasco, and the husbands of the last two: Hostilio Cornelio and Fernando Velasco. 8 Her trust in Hostilio
Cornelio was such that she made him custodian of all the titles of her properties; and before she disposed of any of them, she unfailingly consulted
her lawyer-nephew, Attorney Salvador Lorayes. It was Atty. Lorayes who prepared the legal documents and, more often than not, the witnesses to the
transactions were her niece Elena Jaucian, Maria Lorayes-Cornelio, Maria Olbes-Velasco, or their husbands. Her niece, Elena Jaucian, was her life-
long companion in her house.
Don Mariano relied on Doa Catalina to carry out the terms of their compact, hence, nine (9) years after his death, as if in obedience to his voice
from the grave, and fully cognizant that she was also advancing in years, Doa Catalina began transferring, by sale, donation or assignment, Don
Mariano's as well as her own, properties to their respective nephews and nieces. She made the following sales and donation of properties which she
had received from her husband's estate, to his Locsin nephews and nieces:
EXHIBIT DATE PARTICULARS AREA/SQ.M. PRICE WITNESSES
23 Jan. 26, 1957 Deed of Absolute Sale in 962 P 481
favor of Mariano Locsin
1-JRL Apr. 7, 1966 Deed of Sale in favor of 430,203 P 20,000
Jose R. Locsin
1-JJL Mar. 22, 1967 Deed of Sale in favor of 5,000 P 1,000 Hostilio Cornello
Julian Locsin (Lot 2020) Helen M. Jaucian
1 Nov. 29, 1974 Deed of Donation in 26,509
favor Aurea Locsin,
Matilde L. Cordero
and Salvador Locsin
2 Feb. 4, 1975 Deed of Donation in 34,045
favor Aurea Locsin,
Matilde L. Cordero
and Salvador Locsin
3 Sept. 9, 1975 Deed of Donation in (Lot 2059)
favor Aurea Locsin,
Matilde L. Cordero
and Salvador Locsin
4 July 15, 1974 Deed of Absolute Sale in 1,424 Hostilio Cornelio
favor of Aurea B. Locsin Fernando Velasco
5 July 15, 1974 Deed of Absolute Sale in 1,456 P 5,750 Hostilio Cornelio
favor of Aurea B. Locsin Elena Jaucian
6 July 15, 1974 Deed of Absolute Sale in 1,237 P 5,720 - ditto -
favor of Aurea B. Locsin
7 July 15, 1974 Deed of Absolute Sale in 1,404 P 4,050 - ditto -
favor of Aurea B. Locsin
15 Nov. 26, 1975 Deed of Sale in favor of 261 P 4,930 - ditto -
Aurea Locsin
16 Oct. 17, 1975 Deed of Sale in favor of 533 P 2,000 Delfina Anson
Aurea Locsin M. Acabado
17 Nov. 26, 1975 Deed of Sale in favor of 373 P 1,000 Leonor Satuito
Aurea Locsin Mariano B. Locsin
19 Sept. 1, 1975 Conditional Donation in 1,130 P 3,000 - ditto -
favor of Mariano Locsin
1-MVRJ Dec. 29, 1972 Deed of Reconveyance 1,5110.66 P 1,000 Delfina Anson
in favor of Manuel V. del (Lot 2155) Antonio Illegible
Rosario whose maternal
grandfather was Getulio
Locsin
2-MVRJ June 30, 1973 Deed of Reconveyance 319.34 P 500 Antonio Illegible
in favor of Manuel V. del (Lot 2155) Salvador Nical
Rosario but the rentals
from bigger portion of
Lot 2155 leased to Filoil
Refinery were assigned to
Maria Jaucian Lorayes
Cornelio
Of her own properties, Doa Catalina conveyed the following to her own nephews and nieces and others:
EXHIBIT DATE PARTICULARS AREA/SQ.M. PRICE
2-JJL July 16, 1964 Deed of Sale in favor 5,000 P 1,000
Vicente Jaucian (lot 2020)
(6,825 sqm. when
resurveyed)
24 Feb. 12, 1973 Deed of Absolute Sale 100 P 1,000
in favor of Francisco M.
Maquiniana
26 July 15, 1973 Deed of Absolute Sale in 130 P 1,300
favor of Francisco
Maquiniana
27 May 3, 1973 Deed of Absolute Sale in 100 P 1,000
favor of Ireneo Mamia
28 May 3, 1973 Deed of Absolute Sale in 75 P 750
favor of Zenaida Buiza
29 May 3, 1973 Deed of Absolute Sale in 150 P 1,500
favor of Felisa Morjella
30 Apr. 3, 1973 Deed of Absolute Sale in 31 P 1,000
favor of Inocentes Motocinos
31 Feb. 12, 1973 Deed of Absolute Sale in 150 P 1,500
favor of Casimiro Mondevil
32 Mar. 1, 1973 Deed of Absolute Sale in 112 P 1,200
favor of Juan Saballa
25 Dec. 28, 1973 Deed of Absolute Sale in 250 P 2,500
of Rogelio Marticio
Doa Catalina died on July 6, 1977.
Four years before her death, she had made a will on October 22, 1973 affirming and ratifying the transfers she had made during her lifetime in favor
of her husband's, and her own, relatives. After the reading of her will, all the relatives agreed that there was no need to submit it to the court for
probate because the properties devised to them under the will had already been conveyed to them by the deceased when she was still alive, except
some legacies which the executor of her will or estate, Attorney Salvador Lorayes, proceeded to distribute.
In 1989, or six (6) years after Doa Catalina's demise, some of her Jaucian nephews and nieces who had already received their legacies and
hereditary shares from her estate, filed action in the Regional Trial Court of Legaspi City (Branch VIII, Civil Case No. 7152) to recover the properties
which she had conveyed to the Locsins during her lifetime, alleging that the conveyances were inofficious, without consideration, and intended solely
to circumvent the laws on succession. Those who were closest to Doa Catalina did not join the action.
After the trial, judgment was rendered on July 8, l985 in favor of the plaintiffs (Jaucian), and against the Locsin defendants, the dispositive part of
which reads:
WHEREFORE, this Court renders judgment for the plaintiffs and against the defendants:
(1) declaring the, plaintiffs, except the heirs of Josefina J. Borja and Eduardo Jaucian, who withdrew, the rightful heirs and
entitled to the entire estate, in equal portions, of Catalina Jaucian Vda. de Locsin, being the nearest collateral heirs by right of
representation of Juan and Gregorio, both surnamed Jaucian, and full-blood brothers of Catalina;
(2) declaring the deeds of sale, donations, reconveyance and exchange and all other instruments conveying any part of the estate
of Catalina J. Vda. de Locsin including, but not limited to those in the inventory of known properties (Annex B of the complaint)
as null and void ab-initio;
(3) ordering the Register of Deeds of Albay and/or Legazpi City to cancel all certificates of title and other transfers of the real
properties, subject of this case, in the name of defendants, and derivatives therefrom, and issue new ones to the plaintiffs;
(4) ordering the defendants, jointly and severally, to reconvey ownership and possession of all such properties to the plaintiffs,
together with all muniments of title properly endorsed and delivered, and all the fruits and incomes received by the defendants
from the estate of Catalina, with legal interest from the filing of this action; and where reconveyance and delivery cannot be
effected for reasons that might have intervened and prevent the same, defendants shall pay for the value of such properties, fruits
and incomes received by them, also with legal interest from the filing, of this case
(5) ordering each of the defendants to pay the plaintiffs the amount of P30,000.00 as exemplary damages; and the further sum of
P20,000.00 each as moral damages; and
(6) ordering the defendants to pay the plaintiffs attorney's fees and litigation expenses, in the amount of P30,000.00 without
prejudice to any contract between plaintiffs and counsel.
Costs against the defendants. 9
The Locsins appealed to the Court of Appeals (CA-G.R. No. CV-11186) which rendered its now appealed judgment on March 14, 1989, affirming the
trial court's decision.
The petition has merit and should be granted.
The trial court and the Court of Appeals erred in declaring the private respondents, nephews and nieces of Doa Catalina J. Vda. de Locsin, entitled
to inherit the properties which she had already disposed of more than ten (10) years before her death. For those properties did not form part of her
hereditary estate, i.e., "the property and transmissible rights and obligations existing at the time of (the decedent's) death and those which have
accrued thereto since the opening of the succession." 10 The rights to a person's succession are transmitted from the moment of his death, and do not
vest in his heirs until such time. 11 Property which Doa Catalina had transferred or conveyed to other persons during her lifetime no longer formed
part of her estate at the time of her death to which her heirs may lay claim. Had she died intestate, only the property that remained in her estate at the
time of her death devolved to her legal heirs; and even if those transfers were, one and all, treated as donations, the right arising under certain
circumstances to impugn and compel the reduction or revocation of a decedent's gifts inter vivos does not inure to the respondents since neither they
nor the donees are compulsory (or forced) heirs. 12
There is thus no basis for assuming an intention on the part of Doa Catalina, in transferring the properties she had received from her late husband to
his nephews and nieces, an intent to circumvent the law in violation of the private respondents' rights to her succession. Said respondents are not her
compulsory heirs, and it is not pretended that she had any such, hence there were no legitimes that could conceivably be impaired by any transfer of
her property during her lifetime. All that the respondents had was an expectancy that in nowise restricted her freedom to dispose of even her entire
estate subject only to the limitation set forth in Art. 750, Civil Code which, even if it were breached, the respondents may not invoke:
Art. 750. The donation may comprehend all the present property of the donor or part thereof, provided he reserves, in full
ownership or in usufruct, sufficient means for the support of himself, and of all relatives who, at the time of the acceptance of the
donation, are by law entitled to be supported by the donor. Without such reservation, the donation shall be reduced on petition of
any person affected. (634a)
The lower court capitalized on the fact that Doa Catalina was already 90 years old when she died on July 6, 1977. It insinuated that because of her
advanced years she may have been imposed upon, or unduly influenced and morally pressured by her husband's nephews and nieces (the petitioners)
to transfer to them the properties which she had inherited from Don Mariano's estate. The records do not support that conjecture.
For as early as 1957, or twenty-eight (28) years before her death, Doa Catalina had already begun transferring to her Locsin nephews and nieces the
properties which she received from Don Mariano. She sold a 962-sq.m. lot on January 26, 1957 to his nephew and namesake Mariano Locsin II. 13 On
April 7, 1966, or 19 years before she passed away, she also sold a 43 hectare land to another Locsin nephew, Jose R. Locsin. 14 The next year, or on
March 22, 1967, she sold a 5,000-sq.m. portion of Lot 2020 to Julian Locsin. 15
On March 27, 1967, Lot 2020 16 was partitioned by and among Doa Catalina, Julian Locsin, Vicente Jaucian and Agapito Lorete. 17 At least Vicente
Jaucian, among the other respondents in this case, is estopped from assailing the genuineness and due execution of the sale of portions of Lot 2020 to
himself, Julian Locsin, and Agapito Lorete, and the partition agreement that he (Vicente) concluded with the other co-owners of Lot 2020.
Among Doa, Catalina's last transactions before she died in 1977 were the sales of property which she made in favor of Aurea Locsin and Mariano
Locsin in 1975. 18
There is not the slightest suggestion in the record that Doa Catalina was mentally incompetent when she made those dispositions. Indeed, how can
any such suggestion be made in light of the fact that even as she was transferring properties to the Locsins, she was also contemporaneously
disposing of her other properties in favor of the Jaucians? She sold to her nephew, Vicente Jaucian, on July 16, 1964 (21 years before her death) one-
half (or 5,000 sq.m.) of Lot 2020. Three years later, or on March 22, 1967, she sold another 5000 sq.m. of the same lot to Julian Locsin. 19
From 1972 to 1973 she made several other transfers of her properties to her relatives and other persons, namely: Francisco Maquiniana, Ireneo
Mamia, Zenaida Buiza, Feliza Morjella, Inocentes Motocinos, Casimiro Mondevil, Juan Saballa and Rogelio Marticio. 20 None of those transactions
was impugned by the private respondents.
In 1975, or two years before her death, Doa Catalina sold some lots not only to Don Mariano's niece, Aurea Locsin, and his nephew, Mariano Locsin
II, 21 but also to her niece, Mercedes Jaucian Arboleda. 22 If she was competent to make that conveyance to Mercedes, how can there be any doubt that
she was equally competent to transfer her other pieces of property to Aurea and Mariano II?
The trial court's belief that Don Mariano Locsin bequeathed his entire estate to his wife, from a "consciousness of its real origin" which carries the
implication that said estate consisted of properties which his wife had inherited from her parents, flies in the teeth of Doa Catalina's admission in her
inventory of that estate, that "items 1 to 33 are the private properties of the deceased (Don Mariano) and forms (sic) part of his capital at the time of
the marriage with the surviving spouse, while items 34 to 42 are conjugal properties, acquired during the marriage." She would have known better
than anyone else whether the listing included any of her paraphernal property so it is safe to assume that none was in fact included. The inventory
was signed by her under oath, and was approved by the probate court in Special Proceeding No. 138 of the Court of First Instance of Albay. It was
prepared with the assistance of her own nephew and counsel, Atty. Salvador Lorayes, who surely would not have prepared a false inventory that
would have been prejudicial to his aunt's interest and to his own, since he stood to inherit from her eventually.
This Court finds no reason to disbelieve Attorney Lorayes' testimony that before Don Mariano died, he and his wife (Doa Catalina), being childless,
had agreed that their respective properties should eventually revert to their respective lineal relatives. As the trusted legal adviser of the spouses and a
full-blood nephew of Doa Catalina, he would not have spun a tale out of thin air that would also prejudice his own interest.
Little significance, it seems, has been attached to the fact that among Doa Catalina's nephews and nieces, those closest to her: (a) her lawyer-nephew
Attorney Salvador Lorayes; (b) her niece and companion Elena Jaucian: (c) her nieces Maria Olbes-Velasco and Maria Lorayes-Cornelio and their
respective husbands, Fernando Velasco and Hostilio Cornelio, did not join the suit to annul and undo the dispositions of property which she made in
favor of the Locsins, although it would have been to their advantage to do so. Their desistance persuasively demonstrates that Doa Catalina acted as
a completely free agent when she made the conveyances in favor of the petitioners. In fact, considering their closeness to Doa Catalina it would
have been well-nigh impossible for the petitioners to employ "fraud, undue pressure, and subtle manipulations" on her to make her sell or donate her
properties to them. Doa Catalina's niece, Elena Jaucian, daughter of her brother, Eduardo Jaucian, lived with her in her house. Her nephew-in-law,
Hostilio Cornelio, was the custodian of the titles of her properties. The sales and donations which she signed in favor of the petitioners were prepared
by her trusted legal adviser and nephew, Attorney Salvador Lorayes. The (1) deed of donation dated November 19,
1974 23 in favor of Aurea Locsin, (2) another deed of donation dated February 4, 1975 24 in favor of Matilde Cordero, and (3) still another deed dated
September 9, 1975 25 in favor of Salvador Lorayes, were all witnessed by Hostilio Cornelio (who is married to Doa Catalina's niece, Maria Lorayes)
and Fernando Velasco who is married to another niece, Maria Olbes. 26The sales which she made in favor of Aurea Locsin on July 15, 1974 27 were
witnessed by Hostilio Cornelio and Elena Jaucian. Given those circumstances, said transactions could not have been anything but free and voluntary
acts on her part.Apart from the foregoing considerations, the trial court and the Court of Appeals erred in not dismissing this action for annulment and
reconveyance on the ground of prescription. Commenced decades after the transactions had been consummated, and six (6) years after Doa
Catalina's death, it prescribed four (4) years after the subject transactions were recorded in the Registry of Property, 28 whether considered an action
based on fraud, or one to redress an injury to the rights of the plaintiffs. The private respondents may not feign ignorance of said transactions because
the registration of the deeds was constructive notice thereof to them and the whole world. 29
WHEREFORE, the petition for review is granted. The decision dated March 14, 1989 of the Court of Appeals in CA-G.R. CV No. 11186 is
REVERSED and SET ASIDE. The private respondents' complaint for annulment of contracts and reconveyance of properties in Civil Case No. 7152
of the Regional Trial Court, Branch VIII of Legazpi City, is DISMISSED, with costs against the private respondents, plaintiffs therein.
SO ORDERED.
Facts:Mariano inherited extensive property from his father Getulio. He brought his inheritanceinto his marriage with Catalina Jaucian. Catalina, for her part, brought into
the marriageuntitled properties which she had inherited form her parents.Mariano Locsin executed a last will and testament instituting his wife as the sole anduniversal
heir of all his properties. The spouses being childless, they had agreed that theirproperties, after both of them shall have died should revert to their respective sides of
thefamily. After Mariano's death, (1948) his will was probated without opposition from bothsides of the family. Nine years after the death of Don Mariano, Catalina
began transferring,by sale, donation or assignment, Mariano's as well as her own, props to their respectivenephews and nieces.Catalina died in 1977. Four years before
her death, she made a will affirming the transfersshe made. Six years after her demise, some of Catalina's nephews and nieces filed an actionin the RTC of Legaspi to
recover the properties which she had conveyed to the Locsins,alleging that the conveyances were innoficious, without consideration, and intended solelyto circumvent
the laws on succession. After the trial, judgment was rendered in favor of the plaintiffs. The Court of Appeals affirmed the trial court's decision.Issue:WON the PRs are
entitled to inherit the properties which Catalina had already disposed of more than 10 yrs before her death.Ruling:No. The properties did not form part of her hereditaty estate.
The rights to a person'ssuccession are transmitted from the moment of his death, and do not vest in his heirs untilsuch time. 11 Property which Doa Catalina had
transferred or conveyed to other personsduring her lifetime no longer formed part of her estate at the time of her death to whichher heirs may lay claim. Had she died
intestate, only the property that remained in herestate at the time of her death devolved to her legal heirs; and even if those transfers were,one and all, treated as
donations, the right arising under certain circumstances to impugnand compel the reduction or revocation of a decedent's gifts inter vivos does not inure tothe
respondents since neither they nor the donees are compulsory (or forced) heirs.There is thus no basis for assuming an intention on the part of Doa Catalina,
intransferring the properties she had received from her late husband to his nephews andnieces, an intent to circumvent the law in violation of the private respondents'
rights to hersuccession. Said respondents are not her compulsory heirs, and it is not pretended that shehad any such, hence there were no legitimes that could
conceivably be impaired by anytransfer of her property during her lifetime. All that the respondents had was anexpectancy that in nowise restricted her freedom to
dispose of even her entire estatesubject only to the limitation set forth in Art. 750, Civil Code which, even if it werebreached, the respondents may not invoke.
G.R. No. L-43082 June 18, 1937
PABLO LORENZO, as trustee of the estate of Thomas Hanley, deceased, plaintiff-appellant,
vs.
JUAN POSADAS, JR., Collector of Internal Revenue, defendant-appellant.
Pablo Lorenzo and Delfin Joven for plaintiff-appellant.
Office of the Solicitor-General Hilado for defendant-appellant.
LAUREL, J.:
On October 4, 1932, the plaintiff Pablo Lorenzo, in his capacity as trustee of the estate of Thomas Hanley, deceased, brought this action in the Court
of First Instance of Zamboanga against the defendant, Juan Posadas, Jr., then the Collector of Internal Revenue, for the refund of the amount of
P2,052.74, paid by the plaintiff as inheritance tax on the estate of the deceased, and for the collection of interst thereon at the rate of 6 per cent per
annum, computed from September 15, 1932, the date when the aforesaid tax was [paid under protest. The defendant set up a counterclaim for
P1,191.27 alleged to be interest due on the tax in question and which was not included in the original assessment. From the decision of the Court of
First Instance of Zamboanga dismissing both the plaintiff's complaint and the defendant's counterclaim, both parties appealed to this court.
It appears that on May 27, 1922, one Thomas Hanley died in Zamboanga, Zamboanga, leaving a will (Exhibit 5) and considerable amount of real and
personal properties. On june 14, 1922, proceedings for the probate of his will and the settlement and distribution of his estate were begun in the Court
of First Instance of Zamboanga. The will was admitted to probate. Said will provides, among other things, as follows:
4. I direct that any money left by me be given to my nephew Matthew Hanley.
5. I direct that all real estate owned by me at the time of my death be not sold or otherwise disposed of for a period of ten (10) years after
my death, and that the same be handled and managed by the executors, and proceeds thereof to be given to my nephew, Matthew Hanley, at
Castlemore, Ballaghaderine, County of Rosecommon, Ireland, and that he be directed that the same be used only for the education of my
brother's children and their descendants.
6. I direct that ten (10) years after my death my property be given to the above mentioned Matthew Hanley to be disposed of in the way he
thinks most advantageous.
xxx xxx xxx
8. I state at this time I have one brother living, named Malachi Hanley, and that my nephew, Matthew Hanley, is a son of my said brother,
Malachi Hanley.
The Court of First Instance of Zamboanga considered it proper for the best interests of ther estate to appoint a trustee to administer the real properties
which, under the will, were to pass to Matthew Hanley ten years after the two executors named in the will, was, on March 8, 1924, appointed trustee.
Moore took his oath of office and gave bond on March 10, 1924. He acted as trustee until February 29, 1932, when he resigned and the plaintiff
herein was appointed in his stead.
During the incumbency of the plaintiff as trustee, the defendant Collector of Internal Revenue, alleging that the estate left by the deceased at the time
of his death consisted of realty valued at P27,920 and personalty valued at P1,465, and allowing a deduction of P480.81, assessed against the estate
an inheritance tax in the amount of P1,434.24 which, together with the penalties for deliquency in payment consisting of a 1 per cent monthly interest
from July 1, 1931 to the date of payment and a surcharge of 25 per cent on the tax, amounted to P2,052.74. On March 15, 1932, the defendant filed a
motion in the testamentary proceedings pending before the Court of First Instance of Zamboanga (Special proceedings No. 302) praying that the
trustee, plaintiff herein, be ordered to pay to the Government the said sum of P2,052.74. The motion was granted. On September 15, 1932, the
plaintiff paid said amount under protest, notifying the defendant at the same time that unless the amount was promptly refunded suit would be
brought for its recovery. The defendant overruled the plaintiff's protest and refused to refund the said amount hausted, plaintiff went to court with the
result herein above indicated.
In his appeal, plaintiff contends that the lower court erred:
I. In holding that the real property of Thomas Hanley, deceased, passed to his instituted heir, Matthew Hanley, from the moment of the
death of the former, and that from the time, the latter became the owner thereof.
II. In holding, in effect, that there was deliquency in the payment of inheritance tax due on the estate of said deceased.
III. In holding that the inheritance tax in question be based upon the value of the estate upon the death of the testator, and not, as it should
have been held, upon the value thereof at the expiration of the period of ten years after which, according to the testator's will, the property
could be and was to be delivered to the instituted heir.
IV. In not allowing as lawful deductions, in the determination of the net amount of the estate subject to said tax, the amounts allowed by the
court as compensation to the "trustees" and paid to them from the decedent's estate.
V. In not rendering judgment in favor of the plaintiff and in denying his motion for new trial.
The defendant-appellant contradicts the theories of the plaintiff and assigns the following error besides:
The lower court erred in not ordering the plaintiff to pay to the defendant the sum of P1,191.27, representing part of the interest at the rate
of 1 per cent per month from April 10, 1924, to June 30, 1931, which the plaintiff had failed to pay on the inheritance tax assessed by the
defendant against the estate of Thomas Hanley.
The following are the principal questions to be decided by this court in this appeal: (a) When does the inheritance tax accrue and when must it be
satisfied? (b) Should the inheritance tax be computed on the basis of the value of the estate at the time of the testator's death, or on its value ten years
later? (c) In determining the net value of the estate subject to tax, is it proper to deduct the compensation due to trustees? (d) What law governs the
case at bar? Should the provisions of Act No. 3606 favorable to the tax-payer be given retroactive effect? (e) Has there been deliquency in the
payment of the inheritance tax? If so, should the additional interest claimed by the defendant in his appeal be paid by the estate? Other points of
incidental importance, raised by the parties in their briefs, will be touched upon in the course of this opinion.
(a) The accrual of the inheritance tax is distinct from the obligation to pay the same. Section 1536 as amended, of the Administrative Code, imposes
the tax upon "every transmission by virtue of inheritance, devise, bequest, giftmortis causa, or advance in anticipation of inheritance,devise, or
bequest." The tax therefore is upon transmission or the transfer or devolution of property of a decedent, made effective by his death. (61 C. J., p.
1592.) It is in reality an excise or privilege tax imposed on the right to succeed to, receive, or take property by or under a will or the intestacy law, or
deed, grant, or gift to become operative at or after death. Acording to article 657 of the Civil Code, "the rights to the succession of a person are
transmitted from the moment of his death." "In other words", said Arellano, C. J., ". . . the heirs succeed immediately to all of the property of the
deceased ancestor. The property belongs to the heirs at the moment of the death of the ancestor as completely as if the ancestor had executed and
delivered to them a deed for the same before his death." (Bondad vs. Bondad, 34 Phil., 232. See also, Mijares vs. Nery, 3 Phil., 195; Suilong & Co.,
vs. Chio-Taysan, 12 Phil., 13; Lubrico vs. Arbado, 12 Phil., 391; Innocencio vs. Gat-Pandan, 14 Phil., 491; Aliasas vs.Alcantara, 16 Phil., 489; Ilustre
vs. Alaras Frondosa, 17 Phil., 321; Malahacan vs. Ignacio, 19 Phil., 434; Bowa vs. Briones, 38 Phil., 27; Osario vs. Osario & Yuchausti Steamship
Co., 41 Phil., 531; Fule vs. Fule, 46 Phil., 317; Dais vs. Court of First Instance of Capiz, 51 Phil., 396; Baun vs. Heirs of Baun, 53 Phil., 654.)
Plaintiff, however, asserts that while article 657 of the Civil Code is applicable to testate as well as intestate succession, it operates only in so far as
forced heirs are concerned. But the language of article 657 of the Civil Code is broad and makes no distinction between different classes of heirs.
That article does not speak of forced heirs; it does not even use the word "heir". It speaks of the rights of succession and the transmission thereof
from the moment of death. The provision of section 625 of the Code of Civil Procedure regarding the authentication and probate of a will as a
necessary condition to effect transmission of property does not affect the general rule laid down in article 657 of the Civil Code. The authentication of
a will implies its due execution but once probated and allowed the transmission is effective as of the death of the testator in accordance with article
657 of the Civil Code. Whatever may be the time when actual transmission of the inheritance takes place, succession takes place in any event at the
moment of the decedent's death. The time when the heirs legally succeed to the inheritance may differ from the time when the heirs actually receive
such inheritance. "Poco importa", says Manresa commenting on article 657 of the Civil Code, "que desde el falleimiento del causante, hasta que el
heredero o legatario entre en posesion de los bienes de la herencia o del legado, transcurra mucho o poco tiempo, pues la adquisicion ha de
retrotraerse al momento de la muerte, y asi lo ordena el articulo 989, que debe considerarse como complemento del presente." (5 Manresa, 305; see
also, art. 440, par. 1, Civil Code.) Thomas Hanley having died on May 27, 1922, the inheritance tax accrued as of the date.
From the fact, however, that Thomas Hanley died on May 27, 1922, it does not follow that the obligation to pay the tax arose as of the date. The time
for the payment on inheritance tax is clearly fixed by section 1544 of the Revised Administrative Code as amended by Act No. 3031, in relation to
section 1543 of the same Code. The two sections follow:
SEC. 1543. Exemption of certain acquisitions and transmissions. The following shall not be taxed:
(a) The merger of the usufruct in the owner of the naked title.
(b) The transmission or delivery of the inheritance or legacy by the fiduciary heir or legatee to the trustees.
(c) The transmission from the first heir, legatee, or donee in favor of another beneficiary, in accordance with the desire of the
predecessor.
In the last two cases, if the scale of taxation appropriate to the new beneficiary is greater than that paid by the first, the former must pay the
difference.
SEC. 1544. When tax to be paid. The tax fixed in this article shall be paid:
(a) In the second and third cases of the next preceding section, before entrance into possession of the property.
(b) In other cases, within the six months subsequent to the death of the predecessor; but if judicial testamentary or intestate
proceedings shall be instituted prior to the expiration of said period, the payment shall be made by the executor or administrator
before delivering to each beneficiary his share.
If the tax is not paid within the time hereinbefore prescribed, interest at the rate of twelve per centum per annum shall be added as part of
the tax; and to the tax and interest due and unpaid within ten days after the date of notice and demand thereof by the collector, there shall be
further added a surcharge of twenty-five per centum.
A certified of all letters testamentary or of admisitration shall be furnished the Collector of Internal Revenue by the Clerk of Court within
thirty days after their issuance.
It should be observed in passing that the word "trustee", appearing in subsection (b) of section 1543, should read "fideicommissary" or "cestui que
trust". There was an obvious mistake in translation from the Spanish to the English version.
The instant case does fall under subsection (a), but under subsection (b), of section 1544 above-quoted, as there is here no fiduciary heirs, first heirs,
legatee or donee. Under the subsection, the tax should have been paid before the delivery of the properties in question to P. J. M. Moore as trustee on
March 10, 1924.
(b) The plaintiff contends that the estate of Thomas Hanley, in so far as the real properties are concerned, did not and could not legally pass to the
instituted heir, Matthew Hanley, until after the expiration of ten years from the death of the testator on May 27, 1922 and, that the inheritance tax
should be based on the value of the estate in 1932, or ten years after the testator's death. The plaintiff introduced evidence tending to show that in
1932 the real properties in question had a reasonable value of only P5,787. This amount added to the value of the personal property left by the
deceased, which the plaintiff admits is P1,465, would generate an inheritance tax which, excluding deductions, interest and surcharge, would amount
only to about P169.52.
If death is the generating source from which the power of the estate to impose inheritance taxes takes its being and if, upon the death of the decedent,
succession takes place and the right of the estate to tax vests instantly, the tax should be measured by the vlaue of the estate as it stood at the time of
the decedent's death, regardless of any subsequent contingency value of any subsequent increase or decrease in value. (61 C. J., pp. 1692, 1693; 26 R.
C. L., p. 232; Blakemore and Bancroft, Inheritance Taxes, p. 137. See also Knowlton vs. Moore, 178 U.S., 41; 20 Sup. Ct. Rep., 747; 44 Law. ed.,
969.) "The right of the state to an inheritance tax accrues at the moment of death, and hence is ordinarily measured as to any beneficiary by the value
at that time of such property as passes to him. Subsequent appreciation or depriciation is immaterial." (Ross, Inheritance Taxation, p. 72.)
Our attention is directed to the statement of the rule in Cyclopedia of Law of and Procedure (vol. 37, pp. 1574, 1575) that, in the case of contingent
remainders, taxation is postponed until the estate vests in possession or the contingency is settled. This rule was formerly followed in New York and
has been adopted in Illinois, Minnesota, Massachusetts, Ohio, Pennsylvania and Wisconsin. This rule, horever, is by no means entirely satisfactory
either to the estate or to those interested in the property (26 R. C. L., p. 231.). Realizing, perhaps, the defects of its anterior system, we find upon
examination of cases and authorities that New York has varied and now requires the immediate appraisal of the postponed estate at its clear market
value and the payment forthwith of the tax on its out of the corpus of the estate transferred. (In re Vanderbilt, 172 N. Y., 69; 69 N. E., 782; In
re Huber, 86 N. Y. App. Div., 458; 83 N. Y. Supp., 769; Estate of Tracy, 179 N. Y., 501; 72 N. Y., 519; Estate of Brez, 172 N. Y., 609; 64 N. E., 958;
Estate of Post, 85 App. Div., 611; 82 N. Y. Supp., 1079. Vide also, Saltoun vs. Lord Advocate, 1 Peter. Sc. App., 970; 3 Macq. H. L., 659; 23 Eng.
Rul. Cas., 888.) California adheres to this new rule (Stats. 1905, sec. 5, p. 343).
But whatever may be the rule in other jurisdictions, we hold that a transmission by inheritance is taxable at the time of the predecessor's death,
notwithstanding the postponement of the actual possession or enjoyment of the estate by the beneficiary, and the tax measured by the value of the
property transmitted at that time regardless of its appreciation or depreciation.
(c) Certain items are required by law to be deducted from the appraised gross in arriving at the net value of the estate on which the inheritance tax is
to be computed (sec. 1539, Revised Administrative Code). In the case at bar, the defendant and the trial court allowed a deduction of only P480.81.
This sum represents the expenses and disbursements of the executors until March 10, 1924, among which were their fees and the proven debts of the
deceased. The plaintiff contends that the compensation and fees of the trustees, which aggregate P1,187.28 (Exhibits C, AA, EE, PP, HH, JJ, LL, NN,
OO), should also be deducted under section 1539 of the Revised Administrative Code which provides, in part, as follows: "In order to determine the
net sum which must bear the tax, when an inheritance is concerned, there shall be deducted, in case of a resident, . . . the judicial expenses of the
testamentary or intestate proceedings, . . . ."
A trustee, no doubt, is entitled to receive a fair compensation for his services (Barney vs. Saunders, 16 How., 535; 14 Law. ed., 1047). But from this it
does not follow that the compensation due him may lawfully be deducted in arriving at the net value of the estate subject to tax. There is no statute in
the Philippines which requires trustees' commissions to be deducted in determining the net value of the estate subject to inheritance tax (61 C. J., p.
1705). Furthermore, though a testamentary trust has been created, it does not appear that the testator intended that the duties of his executors and
trustees should be separated. (Ibid.; In re Vanneck's Estate, 161 N. Y. Supp., 893; 175 App. Div., 363; In re Collard's Estate, 161 N. Y. Supp., 455.)
On the contrary, in paragraph 5 of his will, the testator expressed the desire that his real estate be handled and managed by his executors until the
expiration of the period of ten years therein provided. Judicial expenses are expenses of administration (61 C. J., p. 1705) but, in State vs. Hennepin
County Probate Court (112 N. W., 878; 101 Minn., 485), it was said: ". . . The compensation of a trustee, earned, not in the administration of the
estate, but in the management thereof for the benefit of the legatees or devises, does not come properly within the class or reason for exempting
administration expenses. . . . Service rendered in that behalf have no reference to closing the estate for the purpose of a distribution thereof to those
entitled to it, and are not required or essential to the perfection of the rights of the heirs or legatees. . . . Trusts . . . of the character of that here before
the court, are created for the the benefit of those to whom the property ultimately passes, are of voluntary creation, and intended for the preservation
of the estate. No sound reason is given to support the contention that such expenses should be taken into consideration in fixing the value of the estate
for the purpose of this tax."
(d) The defendant levied and assessed the inheritance tax due from the estate of Thomas Hanley under the provisions of section 1544 of the Revised
Administrative Code, as amended by section 3 of Act No. 3606. But Act No. 3606 went into effect on January 1, 1930. It, therefore, was not the law
in force when the testator died on May 27, 1922. The law at the time was section 1544 above-mentioned, as amended by Act No. 3031, which took
effect on March 9, 1922.
It is well-settled that inheritance taxation is governed by the statute in force at the time of the death of the decedent (26 R. C. L., p. 206; 4 Cooley on
Taxation, 4th ed., p. 3461). The taxpayer can not foresee and ought not to be required to guess the outcome of pending measures. Of course, a tax
statute may be made retroactive in its operation. Liability for taxes under retroactive legislation has been "one of the incidents of social life." (Seattle
vs. Kelleher, 195 U. S., 360; 49 Law. ed., 232 Sup. Ct. Rep., 44.) But legislative intent that a tax statute should operate retroactively should be
perfectly clear. (Scwab vs. Doyle, 42 Sup. Ct. Rep., 491; Smietanka vs. First Trust & Savings Bank, 257 U. S., 602; Stockdale vs. Insurance Co., 20
Wall., 323; Lunch vs. Turrish, 247 U. S., 221.) "A statute should be considered as prospective in its operation, whether it enacts, amends, or repeals
an inheritance tax, unless the language of the statute clearly demands or expresses that it shall have a retroactive effect, . . . ." (61 C. J., P. 1602.)
Though the last paragraph of section 5 of Regulations No. 65 of the Department of Finance makes section 3 of Act No. 3606, amending section 1544
of the Revised Administrative Code, applicable to all estates the inheritance taxes due from which have not been paid, Act No. 3606 itself contains no
provisions indicating legislative intent to give it retroactive effect. No such effect can begiven the statute by this court.
The defendant Collector of Internal Revenue maintains, however, that certain provisions of Act No. 3606 are more favorable to the taxpayer than
those of Act No. 3031, that said provisions are penal in nature and, therefore, should operate retroactively in conformity with the provisions of article
22 of the Revised Penal Code. This is the reason why he applied Act No. 3606 instead of Act No. 3031. Indeed, under Act No. 3606, (1) the surcharge
of 25 per cent is based on the tax only, instead of on both the tax and the interest, as provided for in Act No. 3031, and (2) the taxpayer is allowed
twenty days from notice and demand by rthe Collector of Internal Revenue within which to pay the tax, instead of ten days only as required by the
old law.
Properly speaking, a statute is penal when it imposes punishment for an offense committed against the state which, under the Constitution, the
Executive has the power to pardon. In common use, however, this sense has been enlarged to include within the term "penal statutes" all status which
command or prohibit certain acts, and establish penalties for their violation, and even those which, without expressly prohibiting certain acts, impose
a penalty upon their commission (59 C. J., p. 1110). Revenue laws, generally, which impose taxes collected by the means ordinarily resorted to for
the collection of taxes are not classed as penal laws, although there are authorities to the contrary. (See Sutherland, Statutory Construction, 361;
Twine Co. vs. Worthington, 141 U. S., 468; 12 Sup. Ct., 55; Rice vs. U. S., 4 C. C. A., 104; 53 Fed., 910; Com. vs. Standard Oil Co., 101 Pa. St., 150;
State vs. Wheeler, 44 P., 430; 25 Nev. 143.) Article 22 of the Revised Penal Code is not applicable to the case at bar, and in the absence of clear
legislative intent, we cannot give Act No. 3606 a retroactive effect.
(e) The plaintiff correctly states that the liability to pay a tax may arise at a certain time and the tax may be paid within another given time. As stated
by this court, "the mere failure to pay one's tax does not render one delinqent until and unless the entire period has eplased within which the taxpayer
is authorized by law to make such payment without being subjected to the payment of penalties for fasilure to pay his taxes within the prescribed
period." (U. S. vs. Labadan, 26 Phil., 239.)
The defendant maintains that it was the duty of the executor to pay the inheritance tax before the delivery of the decedent's property to the trustee.
Stated otherwise, the defendant contends that delivery to the trustee was delivery to the cestui que trust, the beneficiery in this case, within the
meaning of the first paragraph of subsection (b) of section 1544 of the Revised Administrative Code. This contention is well taken and is sustained.
The appointment of P. J. M. Moore as trustee was made by the trial court in conformity with the wishes of the testator as expressed in his will. It is
true that the word "trust" is not mentioned or used in the will but the intention to create one is clear. No particular or technical words are required to
create a testamentary trust (69 C. J., p. 711). The words "trust" and "trustee", though apt for the purpose, are not necessary. In fact, the use of these
two words is not conclusive on the question that a trust is created (69 C. J., p. 714). "To create a trust by will the testator must indicate in the will his
intention so to do by using language sufficient to separate the legal from the equitable estate, and with sufficient certainty designate the beneficiaries,
their interest in the ttrust, the purpose or object of the trust, and the property or subject matter thereof. Stated otherwise, to constitute a valid
testamentary trust there must be a concurrence of three circumstances: (1) Sufficient words to raise a trust; (2) a definite subject; (3) a certain or
ascertain object; statutes in some jurisdictions expressly or in effect so providing." (69 C. J., pp. 705,706.) There is no doubt that the testator intended
to create a trust. He ordered in his will that certain of his properties be kept together undisposed during a fixed period, for a stated purpose. The
probate court certainly exercised sound judgment in appointment a trustee to carry into effect the provisions of the will (see sec. 582, Code of Civil
Procedure).
P. J. M. Moore became trustee on March 10, 1924. On that date trust estate vested in him (sec. 582 in relation to sec. 590, Code of Civil Procedure).
The mere fact that the estate of the deceased was placed in trust did not remove it from the operation of our inheritance tax laws or exempt it from the
payment of the inheritance tax. The corresponding inheritance tax should have been paid on or before March 10, 1924, to escape the penalties of the
laws. This is so for the reason already stated that the delivery of the estate to the trustee was in esse delivery of the same estate to the cestui que trust,
the beneficiary in this case. A trustee is but an instrument or agent for thecestui que trust (Shelton vs. King, 299 U. S., 90; 33 Sup. Ct. Rep., 689; 57
Law. ed., 1086). When Moore accepted the trust and took possesson of the trust estate he thereby admitted that the estate belonged not to him but to
his cestui que trust (Tolentino vs. Vitug, 39 Phil.,126, cited in 65 C. J., p. 692, n. 63). He did not acquire any beneficial interest in the estate. He took
such legal estate only as the proper execution of the trust required (65 C. J., p. 528) and, his estate ceased upon the fulfillment of the testator's wishes.
The estate then vested absolutely in the beneficiary (65 C. J., p. 542).
The highest considerations of public policy also justify the conclusion we have reached. Were we to hold that the payment of the tax could be
postponed or delayed by the creation of a trust of the type at hand, the result would be plainly disastrous. Testators may provide, as Thomas Hanley
has provided, that their estates be not delivered to their beneficiaries until after the lapse of a certain period of time. In the case at bar, the period is
ten years. In other cases, the trust may last for fifty years, or for a longer period which does not offend the rule against petuities. The collection of the
tax would then be left to the will of a private individual. The mere suggestion of this result is a sufficient warning against the accpetance of the
essential to the very exeistence of government. (Dobbins vs. Erie Country, 16 Pet., 435; 10 Law. ed., 1022; Kirkland vs. Hotchkiss, 100 U. S., 491; 25
Law. ed., 558; Lane County vs. Oregon, 7 Wall., 71; 19 Law. ed., 101; Union Refrigerator Transit Co. vs. Kentucky, 199 U. S., 194; 26 Sup. Ct. Rep.,
36; 50 Law. ed., 150; Charles River Bridge vs. Warren Bridge, 11 Pet., 420; 9 Law. ed., 773.) The obligation to pay taxes rests not upon the privileges
enjoyed by, or the protection afforded to, a citizen by the government but upon the necessity of money for the support of the state (Dobbins vs. Erie
Country, supra). For this reason, no one is allowed to object to or resist the payment of taxes solely because no personal benefit to him can be pointed
out. (Thomas vs. Gay, 169 U. S., 264; 18 Sup. Ct. Rep., 340; 43 Law. ed., 740.) While courts will not enlarge, by construction, the government's
power of taxation (Bromley vs. McCaughn, 280 U. S., 124; 74 Law. ed., 226; 50 Sup. Ct. Rep., 46) they also will not place upon tax laws so loose a
construction as to permit evasions on merely fanciful and insubstantial distictions. (U. S. vs. Watts, 1 Bond., 580; Fed. Cas. No. 16,653; U. S. vs.
Wigglesirth, 2 Story, 369; Fed. Cas. No. 16,690, followed in Froelich & Kuttner vs. Collector of Customs, 18 Phil., 461, 481; Castle Bros., Wolf &
Sons vs. McCoy, 21 Phil., 300; Muoz & Co. vs. Hord, 12 Phil., 624; Hongkong & Shanghai Banking Corporation vs. Rafferty, 39 Phil., 145; Luzon
Stevedoring Co. vs. Trinidad, 43 Phil., 803.) When proper, a tax statute should be construed to avoid the possibilities of tax evasion. Construed this
way, the statute, without resulting in injustice to the taxpayer, becomes fair to the government.
That taxes must be collected promptly is a policy deeply intrenched in our tax system. Thus, no court is allowed to grant injunction to restrain the
collection of any internal revenue tax ( sec. 1578, Revised Administrative Code; Sarasola vs. Trinidad, 40 Phil., 252). In the case of Lim Co Chui vs.
Posadas (47 Phil., 461), this court had occassion to demonstrate trenchment adherence to this policy of the law. It held that "the fact that on account
of riots directed against the Chinese on October 18, 19, and 20, 1924, they were prevented from praying their internal revenue taxes on time and by
mutual agreement closed their homes and stores and remained therein, does not authorize the Collector of Internal Revenue to extend the time
prescribed for the payment of the taxes or to accept them without the additional penalty of twenty five per cent." (Syllabus, No. 3.)
". . . It is of the utmost importance," said the Supreme Court of the United States, ". . . that the modes adopted to enforce the taxes levied should be
interfered with as little as possible. Any delay in the proceedings of the officers, upon whom the duty is developed of collecting the taxes, may
derange the operations of government, and thereby, cause serious detriment to the public." (Dows vs. Chicago, 11 Wall., 108; 20 Law. ed., 65, 66;
Churchill and Tait vs. Rafferty, 32 Phil., 580.)
It results that the estate which plaintiff represents has been delinquent in the payment of inheritance tax and, therefore, liable for the payment of
interest and surcharge provided by law in such cases.
The delinquency in payment occurred on March 10, 1924, the date when Moore became trustee. The interest due should be computed from that date
and it is error on the part of the defendant to compute it one month later. The provisions cases is mandatory (see and cf. Lim Co Chui vs.
Posadas, supra), and neither the Collector of Internal Revenuen or this court may remit or decrease such interest, no matter how heavily it may
burden the taxpayer.
To the tax and interest due and unpaid within ten days after the date of notice and demand thereof by the Collector of Internal Revenue, a surcharge
of twenty-five per centum should be added (sec. 1544, subsec. (b), par. 2, Revised Administrative Code). Demand was made by the Deputy Collector
of Internal Revenue upon Moore in a communiction dated October 16, 1931 (Exhibit 29). The date fixed for the payment of the tax and interest was
November 30, 1931. November 30 being an official holiday, the tenth day fell on December 1, 1931. As the tax and interest due were not paid on that
date, the estate became liable for the payment of the surcharge.
In view of the foregoing, it becomes unnecessary for us to discuss the fifth error assigned by the plaintiff in his brief.
We shall now compute the tax, together with the interest and surcharge due from the estate of Thomas Hanley inaccordance with the conclusions we
have reached.
At the time of his death, the deceased left real properties valued at P27,920 and personal properties worth P1,465, or a total of P29,385. Deducting
from this amount the sum of P480.81, representing allowable deductions under secftion 1539 of the Revised Administrative Code, we have
P28,904.19 as the net value of the estate subject to inheritance tax.
The primary tax, according to section 1536, subsection (c), of the Revised Administrative Code, should be imposed at the rate of one per centum
upon the first ten thousand pesos and two per centum upon the amount by which the share exceed thirty thousand pesos, plus an additional two
hundred per centum. One per centum of ten thousand pesos is P100. Two per centum of P18,904.19 is P378.08. Adding to these two sums an
additional two hundred per centum, or P965.16, we have as primary tax, correctly computed by the defendant, the sum of P1,434.24.
To the primary tax thus computed should be added the sums collectible under section 1544 of the Revised Administrative Code. First should be added
P1,465.31 which stands for interest at the rate of twelve per centum per annum from March 10, 1924, the date of delinquency, to September 15, 1932,
the date of payment under protest, a period covering 8 years, 6 months and 5 days. To the tax and interest thus computed should be added the sum of
P724.88, representing a surhcarge of 25 per cent on both the tax and interest, and also P10, the compromise sum fixed by the defendant (Exh. 29),
giving a grand total of P3,634.43.
As the plaintiff has already paid the sum of P2,052.74, only the sums of P1,581.69 is legally due from the estate. This last sum is P390.42 more than
the amount demanded by the defendant in his counterclaim. But, as we cannot give the defendant more than what he claims, we must hold that the
plaintiff is liable only in the sum of P1,191.27 the amount stated in the counterclaim.
The judgment of the lower court is accordingly modified, with costs against the plaintiff in both instances. So ordered.

FACTS: Thomas Hanley died, leaving a will and a considerable amount of real and personal properties. Proceedings for the probate of his will and the settlement and
distribution of his estate were begun in the CFI of Zamboanga. The will was admitted to probate.
The CFI considered it proper for the best interests of the estate to appoint a trustee to administer the real properties which, under the will, were to pass to nephew
Matthew ten years after the two executors named in the will was appointed trustee. Moore acted as trustee until he resigned and the plaintiff Lorenzo herein was
appointed in his stead.During the incumbency of the plaintiff as trustee, the defendant Collector of Internal Revenue (Posadas) assessed against the estate an inheritance
tax, together with the penalties for deliquency in payment. Lorenzo paid said amount under protest, notifying Posadas at the same time that unless the amount was
promptly refunded suit would be brought for its recovery. Posadas overruled Lorenzos protest and refused to refund the said amount. Plaintiff went to court. The CFI
dismissed Lorenzos complaint and Posadas counterclaim. Both parties appealed to this court.
ISSUE:(e) Has there been delinquency in the payment of the inheritance tax?
HELD: The judgment of the lower court is accordingly modified, with costs against the plaintiff in both instances
YESThe defendant maintains that it was the duty of the executor to pay the inheritance tax before the delivery of the decedents property to the trustee. Stated
otherwise, the defendant contends that delivery to the trustee was delivery to the cestui que trust, the beneficiary in this case, within the meaning of the first paragraph
of subsection (b) of section 1544 of the Revised Administrative Code. This contention is well taken and is sustained. A trustee is but an instrument or agent for
the cestui que trustThe appointment of Moore as trustee was made by the trial court in conformity with the wishes of the testator as expressed in his will. It is true that
the word trust is not mentioned or used in the will but the intention to create one is clear. No particular or technical words are required to create a testamentary trust.
The words trust and trustee, though apt for the purpose, are not necessary. In fact, the use of these two words is not conclusive on the question that a trust is created.
To constitute a valid testamentary trust there must be a concurrence of three circumstances:
(1) Sufficient words to raise a trust;(2) a definite subject;(3) a certain or ascertain object; statutes in some jurisdictions expressly or in effect so providing.There is no
doubt that the testator intended to create a trust. He ordered in his will that certain of his properties be kept together undisposed during a fixed period, for a stated
purpose. The probate court certainly exercised sound judgment in appointmening a trustee to carry into effect the provisions of the willAs the existence of the trust was
already proven, it results that the estate which plaintiff represents has been delinquent in the payment of inheritance tax and, therefore, liable for the payment of interest
and surcharge provided by law in such cases.The delinquency in payment occurred on March 10, 1924, the date when Moore became trustee. On that date trust estate
vested in him. The interest due should be computed from that date.

G.R. No. L-4963 January 29, 1953

MARIA USON, plaintiff-appellee,
vs.
MARIA DEL ROSARIO, CONCEPCION NEBREDA, CONRADO NEBREDA, DOMINADOR NEBREDA, AND FAUSTINO NEBREDA,
Jr., defendants-appellants.
Priscilo Evangelista for appellee.
Brigido G. Estrada for appellant.
BAUTISTA ANGELO, J.:
This is an action for recovery of the ownership and possession of five (5) parcels of land situated in the Municipality of Labrador, Province of
Pangasinan, filed by Maria Uson against Maria del Rosario and her four children named Concepcion, Conrado, Dominador, and Faustino, surnamed
Nebreda, who are all of minor age, before the Court of First Instance of Pangasinan.
Maria Uson was the lawful wife of Faustino Nebreda who upon his death in 1945 left the lands involved in this litigation. Faustino Nebreda left no
other heir except his widow Maria Uson. However, plaintiff claims that when Faustino Nebreda died in 1945, his common-law wife Maria del
Rosario took possession illegally of said lands thus depriving her of their possession and enjoyment.
Defendants in their answer set up as special defense that on February 21, 1931, Maria Uson and her husband, the late Faustino Nebreda, executed a
public document whereby they agreed to separate as husband and wife and, in consideration of their separation, Maria Uson was given a parcel of
land by way of alimony and in return she renounced her right to inherit any other property that may be left by her husband upon his death (Exhibit 1).
After trial, at which both parties presented their respective evidence, the court rendered decision ordering the defendants to restore to the plaintiff the
ownership and possession of the lands in dispute without special pronouncement as to costs. Defendants interposed the present appeal.
There is no dispute that Maria Uson, plaintiff-appellee, is the lawful wife of Faustino Nebreda, former owner of the five parcels of lands litigated in
the present case. There is likewise no dispute that Maria del Rosario, one of the defendants-appellants, was merely a common-law wife of the late
Faustino Nebreda with whom she had four illegitimate children, her now co-defendants. It likewise appears that Faustino Nebreda died in 1945 much
prior to the effectivity of the new Civil Code. With this background, it is evident that when Faustino Nebreda died in 1945 the five parcels of land he
was seized of at the time passed from the moment of his death to his only heir, his widow Maria Uson (Article 657, old Civil Code).As this Court
aptly said, "The property belongs to the heirs at the moment of the death of the ancestor as completely as if the ancestor had executed and delivered
to them a deed for the same before his death" (Ilustre vs. Alaras Frondosa, 17 Phil., 321). From that moment, therefore, the rights of inheritance of
Maria Uson over the lands in question became vested.
The claim of the defendants that Maria Uson had relinquished her right over the lands in question because she expressly renounced to inherit any
future property that her husband may acquire and leave upon his death in the deed of separation they had entered into on February 21, 1931, cannot
be entertained for the simple reason that future inheritance cannot be the subject of a contract nor can it be renounced (1 Manresa, 123, sixth edition;
Tolentino on Civil Code, p. 12; Osorio vs. Osorio and Ynchausti Steamship Co., 41 Phil., 531).
But defendants contend that, while it is true that the four minor defendants are illegitimate children of the late Faustino Nebreda and under the old
Civil Code are not entitled to any successional rights, however, under the new Civil Code which became in force in June, 1950, they are given the
status and rights of natural children and are entitled to the successional rights which the law accords to the latter (article 2264 and article 287, new
Civil Code), and because these successional rights were declared for the first time in the new code, they shall be given retroactive effect even though
the event which gave rise to them may have occurred under the prior legislation (Article 2253, new Civil Code).
There is no merit in this claim. Article 2253 above referred to provides indeed that rights which are declared for the first time shall have retroactive
effect even though the event which gave rise to them may have occurred under the former legislation, but this is so only when the new rights do not
prejudice any vested or acquired right of the same origin. Thus, said article provides that "if a right should be declared for the first time in this Code,
it shall be effective at once, even though the act or event which gives rise thereto may have been done or may have occurred under the prior
legislation, provided said new right does not prejudice or impair any vested or acquired right, of the same origin." As already stated in the early part
of this decision, the right of ownership of Maria Uson over the lands in question became vested in 1945 upon the death of her late husband and this is
so because of the imperative provision of the law which commands that the rights to succession are transmitted from the moment of death (Article
657, old Civil Code). The new right recognized by the new Civil Code in favor of the illegitimate children of the deceased cannot, therefore, be
asserted to the impairment of the vested right of Maria Uson over the lands in dispute.
As regards the claim that Maria Uson, while her deceased husband was lying in state, in a gesture of pity or compassion, agreed to assign the lands in
question to the minor children for the reason that they were acquired while the deceased was living with their mother and Maria Uson wanted to
assuage somewhat the wrong she has done to them, this much can be said; apart from the fact that this claim is disputed, we are of the opinion that
said assignment, if any, partakes of the nature of a donation of real property, inasmuch as it involves no material consideration, and in order that it
may be valid it shall be made in a public document and must be accepted either in the same document or in a separate one (Article 633, old Civil
Code). Inasmuch as this essential formality has not been followed, it results that the alleged assignment or donation has no valid effect.
WHEREFORE, the decision appealed from is affirmed, without costs.

FACTS: Faustino Nebreda died in 1945 leaving as an only heir his estranged wife Maria Uson, the petitioner. The latter sued to recover the ownership and possession of
five parcels of land occupied by defendant Maria del Rosario, decedent's common-law-spouse and her children. As a defense, defendant presented a deed of separation
agreed upon and signed Faustino and Uson containing among others an statement giving a parcel of land to Uson as an alimony and the latter renouncing her rights to
any inheritance from Faustino.
The defendant also contends that while it is true that the four minor defendants are illegitimate children of the decedent and under the old Civil Code are not entitled to
any successional rights, however, under the new Civil Code they are given the status and rights of natural children and are entitled to the successional rights which the
law accords to the latter (article 2264 and article 287, new Civil Code), and because these successional rights were declared for the first time in the new code, they shall
be given retroactive effect even though the event which gave rise to them may have occurred under the prior legislation (Article 2253, new Civil Code).

ISSUE: Are the contentions of the defendants correct?

HELD: No. It is evident that when the decedent died in 1945 the five parcels of land he was seized of at the time passed from the moment of his death to his only heir,
his widow Maria Uson (Article 657, old Civil Code). As this Court aptly said, "The property belongs to the heirs at the moment of the death of the ancestor as
completely as if the ancestor had executed and delivered to them a deed for the same before his death" (Ilustre vs. Alaras Frondosa, 17 Phil., 321). From that moment,
therefore, the rights of inheritance of Maria Uson over the lands in question became vested.
The claim of the defendants that Uson had relinquished her right over the lands in question in view of her expressed renunciation to inherit any future property that her
husband may acquire and leave upon his death in the deed of separation they had entered into cannot be entertained for the simple reason that future inheritance cannot
be the subject of a contract nor can it be renounced.
Nor does the contention that the provisions of the New Civil Code shall apply and be given retroactive effect. Article 2253 above referred to provides indeed that rights
which are declared for the first time shall have retroactive effect even though the event which gave rise to them may have occurred under the former legislation, but this
is so only when the new rights do not prejudice any vested or acquired right of the same origin... As already stated in the early part of this decision, the right of
ownership of Maria Uson over the lands in question became vested in 1945 upon the death of her late husband and this is so because of the imperative provision of the
law which commands that the rights to succession are transmitted from the moment of death (Article 657, old Civil Code). The new right recognized by the new Civil
Code in favor of the illegitimate children of the deceased cannot, therefore, be asserted to the impairment of the vested right of Maria Uson over the lands in dispute.

G.R. No. L-4275 March 23, 1909

PAULA CONDE, plaintiff-appellee,
vs.
ROMAN ABAYA, defendant-appellant.
C. Oben for appellant.
L. Joaquin for appellee.
ARELLANO, C.J.:
From the hearing of the appeal interposed by Roman Abaya in the special proceedings brought in the Court of First Instance of La Laguna for the
settlement of the intestate estate and the distribution of the property of Casiano Abaya it appears:
I. As antecedents: that Casiano Abaya, unmarried, the son of Romualdo Abaya and Sabrina Labadia, died on the 6th of April, 1899; that Paula Conde,
as the mother of the natural children Jose and Teopista Conde, whom the states she had by Casiano Abaya, on the 6th of November, 1905, moved the
settlement of the said intestate succession; that an administrator having been appointed for the said estate on the 25th of November, 1905, Roman
Abaya, a son of the said Romualdo Abaya and Sabrina Labadia, the parents of the late Casiano Abaya, came forward and opposed said appointment
and claimed it for himself as being the nearest relative of the deceased; that this was granted by the court below on the 9th of January, 1906; that on
the 17th of November, 1906, Roman Abaya moved that, after due process of law, the court declare him to be the sole heir of Casiano Abaya, to the
exclusion of all other persons, especially of Paula Conde, and to be therefore entitled to take possession of all the property of said estate, and that it
be adjudicated to him; and that on November 22, 1906, the court ordered the publication of notices for the declaration of heirs and distribution of the
property of the estate.
II. That on the 28th of November, 1906, Paula Conde, in replying to the foregoing motion of Roman Abaya, filed a petition wherein she stated that
she acknowledged the relationship alleged by Roman Abaya, but that she considered that her right was superior to his and moved for a hearing of the
matter, and, in consequence of the evidence that she intended to present she prayed that she be declared to have preferential rights to the property left
by Casiano Abaya, and that the same be adjudicated to her together with the corresponding products thereof.
III. That the trial was held, both parties presenting documentary and oral evidence, and the court below entered the following judgment:
That the administrator of the estate of Casiano Abaya should recognize Teopista and Jose Conde as being natural children of Casiano
Abaya; that the petitioner Paula Conde should succeed to the hereditary rights of her children with respect to the inheritance of their
deceased natural father Casiano Abaya; and therefore, it is hereby declared that she is the only heir to the property of the said intestate
estate, to the exclusion of the administrator, Roman Abaya.
IV. That Roman Abaya excepted to the foregoing judgment, appealed to this court, and presented the following statement of errors:
1. The fact that the court below found that an ordinary action for the acknowledgment of natural children under articles 135 and 137 of the Civil
Code, might be brought in special probate proceedings.
2. The finding that after the death of a person claimed to be an unacknowledged natural child, the mother of such presumed natural child, as heir to
the latter, may bring an action to enforce the acknowledgment of her deceased child in accordance with articles 135 and 137 of the Civil Code.
3. The finding in the judgment that the alleged continuos possession of the deceased children of Paula Conde of the status of natural children of the
late Casiano Abaya, has been fully proven in these proceedings; and
4. On the hypothesis that it was proper to adjudicate the property of this intestate estate to Paula Conde, as improperly found by the court below, the
court erred in not having declared that said property should be reserved in favor of relatives of Casiano Abaya to the third degree, and in not having
previously demanded securities from Paula Conde to guarantee the transmission of the property to those who might fall within the reservation.
As to the first error assigned, the question is set up as to whether in special proceedings for the administration and distribution of an intestate estate,
an action might be brought to enforce the acknowledgment of the natural child of the person from whom the inheritance is derived, that is to say,
whether one might appear as heir on the ground that he is a recognized natural child of the deceased, not having been so recognized by the deceased
either voluntarily or compulsorily by reason of a preexisting judicial decision, but asking at the same time that, in the special proceeding itself, he be
recognized by the presumed legitimate heirs of the deceased who claim to be entitled to the succession opened in the special proceeding.
According to section 782 of the Code of Civil Procedure
If there shall be a controversy before the Court of First Instance as to who the lawful heirs of the deceased person are, or as to the
distributive share to which each person is entitled under the law, the testimony as to such controversy shall be taken in writing by the judge,
under oath, and signed by the witness. Any party in interest whose distributive share is affected by the determination of such controversy,
may appeal from the judgment of the Court of First Instance determining such controversy to the Supreme Court, within the time and in the
manner provided in the last preceding section.
This court has decided the present question in the manner shown in the case of Juana Pimentel vs. Engracio Palanca (5 Phil. Rep., 436.)
The main question with regard to the second error assigned, is whether or not the mother of a natural child now deceased, but who survived the
person who, it is claimed, was his natural father, also deceased, may bring an action for the acknowledgment of the natural filiation in favor of such
child in order to appear in his behalf to receive the inheritance from the person who is supposed to be his natural father.
In order to decide in the affirmative the court below has assigned the following as the only foundation:
In resolving a similar question Manresa says: "An acknowledgment can only be demanded by the natural child and his descendants whom
it shall benefit, and should they be minors or otherwise incapacitated, such person as legally represents them; the mother may ask it in
behalf of her child so long as he is under her authority." On this point no positive declaration has been made, undoubtedly because it was
not considered necessary. A private action is in question and the general rule must be followed. Elsewhere the same author adds: "It may so
happen that the child dies before four years have expired after attaining majority, or that the document supporting his petition for
acknowledgment is discovered after his death, such death perhaps occurring after his parents had died, as is supposed by article 137, or
during their lifetime. In any case such right of action shall pertain to the descendants of the child whom the acknowledgment may interest."
(See Commentaries to arts. 135 and 137, Civil Code, Vol. I.)
The above doctrine, advanced by one of the most eminent commentators of the Civil Code, lacks legal and doctrinal foundation. The power to
transmit the right of such action by the natural child to his descendants can not be sustained under the law, and still less to his mother.
It is without any support in law because the rule laid down in the code is most positive, limiting in form, when establishing the exception for the
exercise of such right of action after the death of the presumed parents, as is shown hereafter. It is not supported by any doctrine, because up to the
present time no argument has been presented, upon which even an approximate conclusion could be based.
Although the Civil Code considerably improved the condition of recognized natural children, granting them rights and actions that they did not
possess under the former laws, they were not, however, placed upon the same place as legitimate ones. The difference that separates these two classes
of children is still great, as proven by so many articles dealing with the rights of the family and the succession in relation to the members thereof. It
may be laid down as legal maxim, that whatever the code does not grant to the legitimate children, or in connection with their rights, must still less be
understood as granted to recognized natural children or in connection with their rights. There is not a single exception in its provisions.
If legitimacy is the attribute that constitutes the basis of the absolute family rights of the child, the acknowledgment of the natural child is, among
illegitimate ones, that which unites him to the family of the father or the mother who recognized him, and affords him a participation in the rights of
the family, relatively advantageous according to whether they are alone or whether they concur with other individuals of the family of his purely
natural father or mother.
Thus, in order to consider the spirit of the Civil Code, nothing is more logical than to establish a comparison between an action to claim the
legitimacy, and one to enforce acknowledgment.
ART. 118. The action to claim its legitimacy may be brought by the child at any time of its lifetime and shall be transmitted to its heirs,
should it die during minority or in a state of insanity. In such cases the heirs shall be allowed a period of five years in which to institute the
action.
The action already instituted by the child is transmitted by its death to the heirs, if it has not lapsed before then.
ART. 137. The actions for the acknowledgment of natural children can be instituted only during the life of the presumed parents, except in
the following cases:
1. If the father or mother died during the maturity of the child, in which case the latter may institute the action before the expiration of the
first four years of its maturity.
2. If, after the death of the father or mother, some instrument, before unknown, should be discovered in which the child is expressly
acknowledged.
In this case the action must be instituted with the six months following the discovery of such instrument.
On this supposition the first difference that results between one action and the other consists in that the right of action for legitimacy lasts during the
whole lifetime of the child, that is, it can always be brought against the presumed parents or their heirs by the child itself, while the right of action for
the acknowledgment of a natural child does not last his whole lifetime, and, as a general rule, it can not be instituted against the heirs of the presumed
parents, inasmuch as it can be exercised only during the life of the presumed parents.
With regard to the question at issue, that is, the transmission to the heirs of the presumed parents of the obligation to admit the legitimate filiation, or
to recognize the natural filiation, there exists the most radical difference in that the former continues during the life of the child who claims to be
legitimate, and he may demand it either directly and primarily from the said presumed parents, or indirectly and secondarily from the heirs of the
latter; while the second does not endure for life; as a general rule, it only lasts during the life of the presumed parents. Hence the other difference,
derived as a consequence, that an action for legitimacy is always brought against the heirs of the presumed parents in case of the death of the latter,
while the action for acknowledgment is not brought against the heirs of such parents, with the exception of the two cases prescribed by article 137
transcribed above.
So much for the passive transmission of the obligation to admit the legitimate filiation, or to acknowledge the natural filiation.
As to the transmission to the heirs of the child of the latter's action to claim his legitimacy, or to obtain the acknowledgment of his natural filiation, it
is seen that the code grants it in the first case, but not in the second. It contains provisions for the transmission of the right of action which, for the
purpose claiming his legitimacy inheres in the child, but it does not say a word with regard to the transmission of the right to obtain the
acknowledgment of the natural filiation.
Therefore, the respective corollary of each of the two above-cited articles is: (1) That the right of action which devolves upon the child to claim his
legitimacy under article 118, may be transmitted to his heirs in certain cases designated in the said article; (2) That the right of action for the
acknowledgment of natural children to which article 137 refers, can never be transmitted, for the reason that the code makes no mention of it in any
case, not even as an exception.
It is most illogical and contrary to every rule of correct interpretation, that the right of action to secure acknowledgment by the natural child should be
presumed to be transmitted, independently, as a rule, to his heirs, while the right of action to claim legitimacy from his predecessor is not expressly,
independently, or, as a general rule, conceded to the heirs of the legitimate child, but only relatively and as an exception. Consequently, the pretension
that the right of action on the part of the child to obtain the acknowledgment of his natural filiation is transmitted to his descendants is altogether
unfounded. No legal provision exists to sustain such pretension, nor can an argument of presumption be based on the lesser claim when there is no
basis for the greater one, and when it is only given as an exception in well-defined cases. It is placing the heirs of the natural child on a better footing
than the heirs of the legitimate one, when, as a matter of fact, the position of a natural child is no better than, no even equal to, that of a legitimate
child.
From the express and precise precepts of the code the following conclusions are derived:
The right of action that devolves upon the child to claim his legitimacy lasts during his whole life, while the right to claim the acknowledgment of a
natural child lasts only during the life of his presumed parents.
Inasmuch as the right of action accruing to the child to claim his legitimacy lasts during his whole life, he may exercise it either against the presumed
parents, or their heirs; while the right of action to secure the acknowledgment of a natural child, since it does not last during his whole life, but
depends on that of the presumed parents, as a general rule can only be exercised against the latter.
Usually the right of action for legitimacy devolving upon the child is of a personal character and pertains exclusively to him, only the child may
exercise it at any time during his lifetime. As an exception, and in three cases only, it may be transmitted to the heirs of the child, to wit, if he died
during his minority, or while insane, or after action had been already instituted.
An action for the acknowledgment of a natural child may, as an exception, be exercised against the heirs of the presumed parents in two cases: first,
in the event of the death of the latter during the minority of the child, and second, upon the discovery of some instrument of express acknowledgment
of the child, executed by the father or mother, the existence of which was unknown during the life of the latter.
But such action for the acknowledgment of a natural child can only be exercised by him. It can not be transmitted to his descendants, or his
ascendants.
In support of the foregoing the following authorities may be cited:
Sanchez Roman, in his Treatise of Civil Law, propounds the question as to whether said action should be considered transmissive to the heirs or
descendants of the natural child, whether he had or had not exercised it up to the time of his death, and decides it as follows:
There is an entire absence of legal provisions, and at most, it might be deemed admissible as a solution, that the right of action to claim the
acknowledgment of a natural child is transmitted by the analogy to his heirs on the same conditions and terms that it is transmitted to the
descendants of a legitimate child, to claim his legitimacy, under article 118, but nothing more; because on this point nothing warrants
placing the heirs of a natural child on a better footing than those of the legitimate child, and even to compare themwould not fail to be a
strained and questionable matter, and one of great difficulty for decision by the courts, for the simple reason that for the heirs of the
legitimate child, the said article 118 exists, while for those of the natural child, as we have said, there is no provision in the code
authorizing the same, although on the other hand there is none that prohibits it. (Vol. V.)
Diaz Guijarro and Martinez Ruiz in their work on "The Civil Code as construed by the supreme court of Spain," commenting upon article 137, say:
Article 118, taking into account the privileges due to the legitimacy of children, grants them the right to claim said legitimacy during their
lifetime, and even authorizes the transmission of said right for the space of five years to the heirs thereof, if the child die during his
minority or in a state of insanity. But as article 137 is based on the consideration that in the case of a natural child, ties are less strong and
sacred in the eyes of the law, it does not fix such a long and indefinite period for the exercise of the action; it limits it to the life of the
parents, excepting in the two cases mentioned in said article; and it does not allow, as does article 118, the action to pass on to the heirs,
inasmuch as, although it does not prohibit it, and for that reason it might be deemed on general principles of law to consent to it, such a
supposition is inadmissible for the reason that a comparison of both articles shows that the silence of the law in the latter case is not, nor it
can be, an omission, but a deliberate intent to establish a wide difference between the advantages granted to a legitimate child and to a
natural one.
(Ibid., Vol. II, 171.)
Navarro Amandi (Cuestionario del Cdigo Civil) raises the question: "Can the heirs of a natural child claim the acknowledgment in those cases
wherein the father or mother are under obligation to acknowledge"? And says:
Opinions are widely divergent. The court of Rennes held (on April 13, 1844) that the right of investigation forms a part of the estate of the
child, and along with his patrimony is transmitted to his heirs. The affirmation is altogether too categorical to be admissible. If it were
correct the same thing would happen as when the legitimacy of a child is claimed, and as already seen, the right of action to demand the
legitimacy is not transmitted to the heirs in every case and as an absolute right, but under certain limitations and circumstances. Now, were
we to admit the doctrine of the court of Rennes, the result would be that the claim for natural filiation would be more favored than one for
legitimate filiation. This would be absurd, because it can not be conceived that the legislator should have granted a right of action to the
heirs of the natural child, which is only granted under great limitations and in very few cases to those of a legitimate one. Some persons
insist that the same rules that govern legitimate filiation apply by analogy to natural child are entitled to claim it in the cases prescribed by
the article 118. The majority, however, are inclined to consider the right to claim acknowledgment as a personal right, and consequently, not
transmissive to the heirs. Really there are no legal grounds to warrant the transmission. (Vol. 2, 229.)
In a decision like the present one it is impossible to bring forward the argument of analogy for the purpose of considering that the heirs of the natural
child are entitled to the right of action which article 118 concedes to the heirs of the legitimate child. The existence of a provision for the one case and
the absence thereof for the other is a conclusive argument that inclusio unius est exclusio alterius, and it can not be understood that the provision of
law should be the same when the same reason does not hold in the one case as in the other.
The theory of law of transmission is also entirely inapplicable in this case. This theory, which in the Roman Law expressed the general rule than an
heir who did not accept an inheritance during his lifetime was incapacitated from transmitting it to his own heirs, included at the same time the idea
that if the inheritance was not transmitted because the heir did not possess it, there were, however, certain things which the heir held and could
transmit. Such was the law and the right to accept the inheritance, for the existing reason that all rights, both real and personal, shall pass to the
heir; quia haeres representat defunctum in omnibus et per omnia. According to the article 659 of the Civil Code, "the inheritance includes all the
property, rights, and obligations of a person, which are not extinguished by his death." If the mother is the heir of her natural child, and the latter,
among other rights during his lifetime was entitled to exercise an action of his acknowledgment against his father, during the life of the latter, if after
his death in some of the excepting cases of article 137, such right, which is a portion of his inheritance, is transmitted to his mother as being his heir,
and it was so understood by the court of Rennes when it considered the right in question, not as a personal and exclusive right of the child which is
extinguished by his death, but a any other right which might be transmitted after his death. This right of supposed transmission is even less tenable
than that sought to be sustained by the argument of analogy.
The right of action pertaining to the child to claim his legitimacy is in all respects superior to that of the child who claims acknowledgment as a
natural child. And it is evident that the right of action to claim his legitimacy is not one of those rights which the legitimate child may transmit by
inheritance to his heirs; it forms no part of the component rights of his inheritance. If it were so, there would have been no necessity to establish its
transmissibility to heirs as an exception in the terms and conditions of article 118 of the code. So that, in order that it may constitute a portion of the
child's inheritance, it is necessary that the conditions and the terms contained in article 118 shall be present, since without them, the right that the
child held during his lifetime, being personal and exclusive in principle, and therefore, as a general rule not susceptible of transmission, would and
should have been extinguished by his death. Therefore, where no express provision like that of article 118 exists, the right of action for the
acknowledgment of a natural child is, in principle and without exception, extinguished by his death, and can not be transmitted as a portion of the
inheritance of the deceased child.
On the other hand, if said right of action formed a part of the child's inheritance, it would be necessary to establish the doctrine that the right to claim
such an acknowledgment from the presumed natural father and from his heirs is an absolute right of the heirs of the child, not limited by certain
circumstances as in the case of the heirs of a natural child with a legitimate one to place the heirs of a natural child and his inheritance on a better
footing than those of a legitimate child would not only be unreasonable, but, as stated in one of the above citations, most absurd and illegal in the
present state of the law and in accordance with the general principles thereof.
For all of the foregoing reasons we hereby reverse the judgment appealed from in all its parts, without any special ruling as to the costs of this
instance.

Facts: Casiano Abaya, unmarried, the son of Romualdo Abaya and Sabina Labadia died on the 1899. Paula Conde,
as the mother of the natural children Jose and Teopista Conde, whom she states she had by Casiano Abaya moved
the settlement of the intestate succession.

An administrator has been appointed for the said estate. However, Roman Abaya brother of Casiano, came forward
and opposed said appointment and claimed it for himself as being the nearest relative of the deceased. The court
declares Roman Abaya to be the sole heir of Casiano Abaya and to be therefore entitled to take possession of all
the property of said estate.

Paula Conde filed a petition wherein she stated that she acknowledged the relationship alleged by Roman Abaya
but that she considered her right was superior to his and moved for a hearing on the matter. She prayed that she be
declared to have preferential rights to the property left by Casiano Abaya.

Issue: Whether or not the petitioner may enforce an action in the acknowledgment of the natural child from Casiano
Abaya.

Ruling: The right of action for legitimacy devolving upon the child is of a personal character and generally pertains
exclusively to him. Only the child may exercise it at any time during his lifetime. As exception, and in three cases
only, it may be transmitted to the heirs of the child, to wit: if he or she died during his or her minority, or while insane,
or after action had already been instituted. Inasmuch as the right of action accruing to the child to claim his or her
legitimacy lasts during his or her whole lifetime, he or she may exercise it either against the presumed parents or his
or her heirs. The right of action which the law concedes to the natural child is not transmitted to his ascendants or
descendants.