BPI VS.

POSADAS
GR 34583, 22 OCT. 1931

BPI, as administrator of the estate of deceased Adolphe Schuetze (non-resident alien),

appealed to CFI Manila absolving defendant, Collector of Internal Revenue, from the complaint
filed against him in recovering the inheritance tax amounting to P1209 paid by the plaintiff,
Rosario Gelano Vda de Schuetze, under protest, and sum of P20,150 representing the
proceeds of the insurance policy of the deceased.

Rosario and Adolphe were married in January 1914. The wife was actually residing and living in
Germany when Adolphe died in December 1927. The latter while in Germany, executed a will
in March 1926, pursuant with its law wherein plaintiff was named his universal heir. The
deceased possessed not only real property situated in the Philippines but also personal property
consisting of shares of stocks in 19 domestic corporations. Included in the personal property is
a life insurance policy issued at Manila on January 1913 for the sum of $10,000 by the Sun Life
Assurance Company of Canada, Manila Branch. In the insurance policy, the estate of the
deceased was named the beneficiary without any qualification. Rosario is the sole and only heir
of the deceased. BPI, as administrator of the decedent’s estate and attorney in fact of the
plaintiff, having been demanded by Posadas to pay the inheritance tax, paid under protest.
Notwithstanding various demands made by plaintiff, Posadas refused to refund such amount.

ISSUE #1: What is the situs of the insurance policy, and also the proceeds?

HELD: The proceeds of the insurance has acquired a situs here in the Philippines.

WON the plaintiff is entitled to the proceeds of the insurance. The Supreme Court said,
since the insurance proceeds were delivered to BPI for administration and distribution, it
has somehow, more or less, acquired a situs here in the Philippines. So even if the
policy is abroad, even if it’s coming from a foreign corporation not covered, doing
business in the Philippines, by the mere fact that it has acquired a situs here in the
Philippines, they form part of the gross estate of the decedent and will be subjected to
the inheritance tax.

Further, the proceeds of a life-insurance policy payable to the insured's estate as the
beneficiary, if delivered to the testamentary administrator of the former as part of the assets of
said estate under probate administration, are subject to the inheritance tax according to the law
on the matter, if they belong to the assured exclusively, and it is immaterial that the insured was
domiciled in these Islands or outside.