Dear PAO,

Our minor daughter inherited a property from her granduncle when she was three years old. As her
parents, we oversee the upkeep of the property and the payment of the taxes due thereon. However,
my husband just recently lost his job and our family’s finances have not been doing well. We can no
longer afford the maintenance of the inherited property and stretch our resources for the payment of
our daughter’s needs. To make matters worse, we also need to pay for our daughter’s tuition and
other school related expenses in a few weeks. A relative offered a substantial amount of money to
purchase the property inherited by our daughter to help our family. We are thinking of selling the
property because we badly need the money. However, the Transfer Certificate of Title is under the
name of our minor daughter and we are uncertain if we, as parents and administrators, could sell our
daughter’s property even if our names do not appear in the Transfer Certificate of Title?

Felix and Kath

Dear Felix and Kath,

You can sell your minor child’s property, provided that you have secured the approval of the court to sell
the same. Article 225 of the Family Code of the Philippines recognizes the parents’ guardianship over
their minor child’s assets without the need of a court pronouncement in the following manner:

“Article 225. The father and the mother shall, jointly exercise legal guardianship over the property of
their unemancipated common child without the necessity of a court appointment. In case of
disagreement, the father’s decision shall prevail, unless there is a judicial order to the contrary.

“Where the market value of the property or the annual income of the child exceeds P50,000, the parent
concerned shall be required to furnish a bond in such amount as the court may determine, but not less
than ten per centum (10%) of the value of the property or annual income, to guarantee the performance
of the obligations prescribed for general guardians.”

However, the authority mentioned above is limited to acts of administration and management, and does
not extend to acts of disposition or encumbrance of the child’s property. Thus, in the case of The minors
Alberto Badillo et al. vs Ferrer (GR L-51369; July 29, 1987, Ponente: Associate Justice Emilio Gancayco),
the Supreme Court explained that “the powers given to her by the laws as the natural guardian covers
only matters of administration and cannot include the power of disposition. She should have first
secured the permission of the court before she alienated that portion of the property in question
belonging to her minor children.” (Emphasis supplied).

Likewise, in the case of Inton vs Quintana (GR L-1236; May 26, 1948, Ponente: Associate Justice Pedro
Tuazon), the Supreme Court further explained:

“Although the mother was said to be the minor children’s guardian — an allegation on which there is
not the slightest evidence — it does not appear that she was authorized to enter into this transaction or
that the sale was approved by the competent court. Without the court’s authority or approval, the sale
was ineffective as to the minor children even if she were the minors’ judicial guardian. A guardian has no
authority to sell real estate of his ward, merely by reason of his general powers, and in the absence of
any special authority to sell conferred by will, statue, or order of court. (28 CJ, 1133.) A sale of the
ward’s realty of guardian without authority of the court is void.” (Emphasis supplied)
Thus, it is clear from the above that although parents have the power to manage and administer their
minor children’s properties, the same does not include the authority to dispose or encumber the
property. Therefore, parents who desire to sell their minor child’s property must first secure the
approval of the court, and post a bond if the value of the property exceeds P50,000.

We hope that we were able to answer your queries. This advice is based solely on the facts you have
narrated and our appreciation of the same. Our opinion may vary when other facts are changed or
elaborated.

Dear PAO,

My husband got a life insurance policy wherein he made as beneficiary our only 3-year-old child
without my knowledge. Unfortunately, he already passed away last year. I immediately went to the
insurance officer to file a claim upon learning this life insurance plan. However, I could not get the
amount for my son because they said that I have to secure first a guardianship bond. Where do I get
this bond? Do I need to secure this considering that I am the biological parent?

Bea

Dear Bea,

The Family Code provides that “pursuant to the natural right and duty of parents over the person and
property of their unemancipated children, parental authority and responsibility shall include the caring
for and rearing them for civic consciousness and efficiency and the development of their moral, mental
and physical character and well-being” (Article 209, Family Code). The father and the mother shall jointly
exercise parental authority over the persons of their common children (Article 211, Family Code). They
shall also exercise joint legal guardianship over the property of their unemancipated common child
without necessity of a court appointment (Article 225, Family Code).

By the death of your husband, your child, being the beneficiary of the former’s life insurance, has gained
property in the form of proceeds from a life insurance policy. However, since he is a minor, your child
needs your assistance or that of a guardian to claim the said proceeds. Although, as stated above,
parents exercise legal guardianship over the properties of their minor children, you cannot claim the
same in behalf of your child if the life insurance proceeds exceeds P50,000 without posting a
guardianship bond in accordance with Article 225 of the Family Code which provides that “where the
market value of the property or the annual income of the child exceeds P50,000, the parent concerned
shall be required to furnish a bond in such amount as the court may determine, but not less than ten per
centum (10%) of the value of property or annual income, to guarantee the performance of the
obligations prescribed for general guardian.”

Before you can post a guardianship bond, you must first institute a verified petition for the approval of
the bond in the proper court of the place where your child resides, or, if your child resides in a foreign
country, in the proper court of the place where the property or any part thereof is situated (Article 225,
Family Code). The posting of bond is conditioned as follows: (1) that you make and return to the court,
within three months after the issuance of your letters of guardianship, a true and complete inventory of
all the property, real or personal of your child, which shall come to your possession or knowledge or to
the possession or knowledge of any person in his behalf; (2) to faithfully execute the duties of the trust,
to manage and dispose of the property accordingly for the best interests of your child, and to provide
for his proper care, custody and education; (3) to render a true and just account of all the properties of
your child in your hands, and of all proceeds or interest derived therefrom xxx; (4) to perform all orders
of court and such other duties as may be required by law (Section 13, A.M. No. 03-02-05-SC, RE:
Proposed Rule on Guardianship of Minors).