Succession and Transfer Taxes The modes and mechanics of acquiring ownership and other real rights over property are fairly complex. One can gain, transfer and lose ownership on a number of ways. Under the New Civil Code (NCC), ownership may be acquired through: Art. 742 (New Civil Code): “Ownership is acquired by occupation and by _ intellectual creation. Ownership and other real 1. Occupation f 2. Intellectual creation rights over property are acquired 3. Law and transmitted by law, by 4. Donation donation, by oe ite and intestate iti succession, and in consequence etke of certain contracts, by. tradition. 7. Prescription They may also be acquired by ‘6. Stickeasion means of prescription Transfer Taxes and Succession Defined Transfer taxes are taxes imposed upon the gratuitous disposition of private properties or rights. Gratuitous transfer is one that neither imposes burden nor requires consideration from transferee or recipient. The transfer of ownership is free because of the absence of financial consideration. Hence, gratuitous transfers are essentially donations. The reverse side of gratuitous transfer is onerous, one where the transferee gives . consideration in return for the property or right(s) received. However, onerous transfers are subject to business taxes instead of tanta taxes. Business taxes are discussed in chapters 7 to 11 of this 00k. Gratuitous transfer or donation may take effect at the time of death of the donor or during the lifetime of both the donor and the donee. TheSeccesiom and, Caper Tees former is known as “donation mortis causa” subject fa! latter is known as “donation inter vivos" Tmbpe en while the Consequently, transfer taxes, which are typically assessed oy, value of the taxable assets transferred, fall into two basic extent namely; estate tax and donor's tax. egories, Succession is a mode of acquisition by virtue of which, the rights and obligations to the extent of the value of the inherita person are transmitted through his death to another or others eit will or by operation of feet Gn Sete ne rears inclu roperty, rights and obligations which are not enue his Meath (Art. 776 NCC). ‘The rights to the succession are ay from the moment of death of the decedent (An. 777 Nec), notwithstanding the postponement of the actual possession or enjo : or the estate by the beneficiary. The “heirs succeed immediately aren property of the deceased ancestor at the moment of death as complete as if the ancestor had executed and delivered to them a deed for tne same before his death. Aue a To be acquirediinherited by the Heir(s) Property Property Broperty, nce, of a her by his ides all the Obligations Obligations Ht Hoy "Cut-off Period The amount of obligations acquired/inherited by As of the date of death of the testator. ‘an heir should not be more than the combined value of the properties and rights inherited Nature of transfer taxes The subject matter of a transfer tax is the privilege of the transferor to gratuitously transfer property or rights which takes effect at the date of death of the transferor (known as transfer mortis causa subject to estate tax) or during the lifetime of the donor and the donee (known as transfer inter vivos subject to donor's tax). Although the amount of transfer tax is based on net estate or net gifts, it shall not be construed as a property tax On this basis, transfer tax is classified as “excise tax’ or privilege he imposed on the act of passing the ownership of property and not on value of the property or right.Scesion and Tuner Tes The Law that Governs the Imposition of Estate Tax It is @ well settled rule that estate taxation is governed by the statute in force at the time of death of the decedent. The estate tax acerues as the date of death of the decedent and the accrual of the tax is distinct from the obligation to pay the same. Upon the death of the decedent, succession takes place and the right of the State to the tax the privilege to transmit the estate vests instantly upon death (Section 3, RR 2-2003). In the Philippines, succession itself (excluding the tax aspect) is governed by the new civil code. ILLUSTRATION 1: ~ : Pedro suffered an unexpected heart attack causing his death on November 1, 2018. His estate composed ofthe following Gash in bank 1,000,000 Commercial building 5,000,000 | Cars 4,000,000 House and lot 3,000,000 | | Juan is the only heir of the decedent. Pedro's remains were cremated on November 8, 2018. The executor of Pedro's estate filed the estate tax return and paid the corresponding estate tax on October 31, 2019. The properties left by the decedent were finaly distributed to Juan on December 14, 2019. Answer the following: | Question 1; When will the transfer of ownership from the decedent to the heir take | effect? | > Answer: November 1, 2018” | The righis to the succession are transmitted from the moment of death of the | decedent, notwithstanding the actual transfer dated December 14, 2019 (Art. TTT NCC). Question 2: When should the estate tax accrue? “> Answer: November 1, 2018 Beginning 2018 (TRAIN Law), the executor is allowed under the tax code to | file and pay the corresponding estate tax within one (1) year from the date of | death, however, the estate tax due accrues immediately at the time of death. It shall be noted that the accrual of the estate tax is distinct from the | obligation to pay the same (RR 2-2003); (Lorenzo vs. Posadas, 84 Phil. 353). | Prior to TRAIN Law, the filing was within six months from death. However, under RA10963 otherwise known as the TRAIN Law, the filing period was extended to within one (1) year from date of death. |Succession and Transfer Tages Question 3: Assume that Pedro's total outstanding liabilities as of the time of his death amounted to 12,000,000. How much of the outstanding liabilities of the | decedent shouldbe assured by Juan? ‘Answer: P10,000,000 Limited only to the extent of the value of properties and rights in Kinds of Succession (Art. 778 NCC): on dies leaving property (inheritance), a question nonmaly afisas as ea his property or estate will be dealt with by those he/she left behind. The answer depends on whether or not.a decedent left a will’ at the time of his death. The definition of succession” in the tax code as discussed in page 2, clearly states that the inheritance are transmitted either by his will (with last will and testament) or by operations of law (in the absence of a last will and testament, the provisions of the civil code on succession shall apply). A person is normally said to have died testate if he left a will at the time of his/her death and a person is said to have died intestate if such a person died without leaving a will. To summarize, succession may be classified as: 1. Testamentary or testate succession. A type of succession that results from the designation of an heir, made in a will executed in the form prescribed by law. 2. Legal or intestate succession. A type of succession which is effected by operations of law (based on the provisions of the civil code regarding succession) since the decedent did not execute a will or if the last will and testament executed by him is void. 3. Mixed succession. A type of succession which is effected partly by “wilf and partly by operation of law. | ILLUSTRATION 2: | The following cases illustrate the different types of succession. | Case A: Testamentary Succession last | Assume the same data in illustration #1. In addition, Pedro left a duly executed | will and testament transferring all his properties to Juan upon his death Po ee ——Succession and Tran. sper Tages Case B: Intestate or Legal Succession | Assume the same data in illustration #1 except that Pedro did not execute a last will | ‘and testament during his lifetime and Juan is the only legal heir qualified to inherit his properties. In such a case, an intestate or legal succession exists, The estate of the decedent will be disposed of in accordance with the provisions of law =| inheritance/succession. Case C: Mixed Succession Assume the same data in illustration #1. Assume further that Pedro left a duly executed last will and testament transferring all his properties to Juan upon his death. The last will and testament was dated November 1, 2017 or exactly one year before Pedro's death. In addition, assume that from the preparation of the ‘will up to the date of his death, rental income from the commercial building amounted to P250,000.. Of this amount, 150,000 was used to acquire a parcel land in Makati while the balance ‘of P100,000 was deposited in a new bank account. Since the parcel of land and the new bank account were acquired by the decedent after November 1, 2017, the aforementioned properties were not included in his wil. Hence, a mixed succession exists. Some of the estate will be transferred in accordance with the duly executed will (testamentary) while the new parcel of land in Makati and the new bank account will be | distributed by operations of law (intestate or legal succession). CAUSES OF LEGAL SUCCESSION OR INTESTACY: 1. Ifa person dies without a will, or with a void will, or one which has subsequently lost its validity. CASE A: VOID WILL ‘Juan Dela Cruz devised in his “will one of his parcels of land located in Valle Verde Subdivision to one of his daughters, Maria Dela Cruz. Juan can neither write nor read “Chinese Mandarin’ but it was the language used in his last will and testament. In such a case, the ‘will’ shall be considered void. As a rule, the last will and testament stall be executed in a language or dialect known to the testator to be considered valid. ILLUSTRATIONS: | CASE B: “WILL” WHICH HAS SUBSEQUENTLY LOST ITS VALIDITY On the eve of November 2, 2018, a day after executing his last will and testament, the testator accidentally obliterated the same. The testator was not able to prepare anew will’ before his death. Consequently, there is no more “last will and testament’ to speak of. An intestate or legal succession exists. At the time of the decedent's death, | his estate shall be disposed of by operations of law.Succession and T Cranspe Taeees es not institute an heir. ‘| Mhscume the same data in ilustation #3-Case A, except that there was no heir | sifted in ast will and testament, The devisee was simply described inthe ‘wi as follows: "| am devising my parcel of land in Valle Verde Subdivision to my closest and favorite daughter.” Assume further that the testator has five (5) children. Pedro D. Magiba (signed) November 1, 2017 | = No heir was identified in the will. As a result, there is no valid “will” because ____ of the absence of an instituted heir. _ 3. Partial institution of heir. Consequently, intestacy takes place as to the undisposed portion. Partial institution of heir means the entire estate was not disposed of in the last will and testament. Therefore, a mixed succession exists. Part of the estate will be disposed of or distributed to the heirs based on the last will and testament. Nonetheless, since there are properties in the estate that were not included in the will, such properties shall be disposed of by operations of law (only as to the undisposed portion or as to the portion of the estate not mentioned in the will). “ILLUSTRATION 5 (Partial institution): | Referto CASE C of iustration #2, 4. When the heir instituted is incapable of succeeding ILLUSTRATIO! Case A: | Assume Pedro named Juan in his wil as his sole beneficiary, except that Juan died | shead of Pedro, Accordingly, the last wil and testament prepared by the testator shall be considered void. Case B: | Assume Pedro named Juan in his wll as his sole beneficiary. Nonetheless, the later In ‘mentally il, The heir in this case is not capable of succeeding the testator. Hence, the last will and testament shall be declared void. ae5. Other causes such as: a. Non-fulfiliment of the suspensive condition attached to th. institution of heir. Suspensive condition is a condition depending upon the happening of an uncertain event which must be fulfilled before an obligation arises. b. Preterition (omission in the testator’s will of one, some or all of the compulsory heirs in the direct line which has the effect of annulling the institution of heir). c. Fulfillment of “resolutory condition”. A resolutory condition refers to a condition whereby, upon fulfillment terminates an already enforceable obligation. d, Expiration of term or period of institution. . Non-compliance or impossibility of compliance with the will. f. Repudiation of the instituted heir. Elements of Succession: 1. Decedent is the general term applied to the person whose property is transmitted through succession, whether or not he left a will. If he left ail, he is called a testator (Art. 775 NCC). Executor is a person designated in the last will and testament to carry out the provisions of the decedent's will. He also performs a fiduciary duty such as taking care of the decedent's estate prior to final disposition to the heirs. Administrator is a person appointed by the court and performs the same duty, in lieu of an executor, if the latter refused to accept the appointment, failed to qualify under the law or the last will and testament did not appoint one. Inheritance (Estate) - Include all the property, rights and obligations of a person which are not extinguished by death and all which have accrued thereto since the opening of succession. Rights which are purely personal are not transmissible for they are extinguished by death (Art. 776 NCC) Successors An heir or successor is a person who is called to the succession either the provision of a will or by operation of law (Art. 782 NCC). Devisees and legatees are persons to whom gifts of real and personal property are respectively given by virtue of a will. Successors or heirs are classified under the law as follows:- d by force of law to som IULSORY HEIRS — those who succee: 1 i ° oe of the inheritance, in an amount predetermined by law, known as the legitime. They succeed whether the testator likes it or not They cannot be deprived by the testator of their legitime except by disinheritance properly effected. Kinds of compulsory heirs: "Primary — those who have precedence over and exclude other compulsory heirs (i.e. legitimate children and descendants). = Secondary - those who succeed only in the absence of the Primary compulsory heirs; (i.e. legitimate parents and ascendants). ; Concurring — those who succeed together with the primary or secondary compulsory heirs; e.g. illegitimate children and descendants and surviving spouse. Primary Compulsory Secondary Compulsory Legitimate children and their D. Legitimate parents and legitimate legitimate descendants. ascendants. (They inherit only. in default of “A*) Wegitimate parents (no other descendants). They inherit only in default of “A” & “C*. B. Surviving spouse . Illegitimate children and their descendants, legitimate or illegitimate NOTE: Brothers and sisters are neither Compulsory heirs nor strangers. However, they may be voluntary heirs, afte ing the legitimes of the voluntary heir is determined through the last will ¢. LEGAL OR INTESTATE HEIRS ~ thos, f the decedent by operation of law ‘Ose who succeed to the estate 0! (decedent di it lid will or nis estate was not entirely disposed of by vai ea Compulsory heirs. A and testament.Composition of Gross Estate The gross estate is divided into two main cat succession purposes, the legitime and free portion as shown below ter ‘Compulsory Heirs: ” | This portion of the estate is reserved by law jp Speatiealy to compulsory heirs as provided in Table t= LEGITINE 1, regardless of whether or not a last will and (le. 75% of the estate) |_| testament was prepared. Refer also to Table 13 for | the sharing of iegitmes by the compulsory heirs | | FREE PORTION Compulsory Heirs andior Voluntary Heirs. (Le. 25% of the estate) = —B) = As provided in the last will and testament. = Inthe absence of a wil, this portion of the estate shall be distributed to “intestate heirs” based in the order of pronty as provided in Table 1-2 below | LEGITINE is part of a testator’s property which he cannot dispose of because the law has reserved it for certain heirs who are, therefore, called compulsory heirs (Art 888 NCC). The compulsory heirs cannot be deprived of their legitime by the testator except by disinheritance properly effected. On the other hand Free Portion is that portion of the estate which the testator can freely dispose of. Hence, anyone may inherit from free portion (compulsory or voluntary heirs). Nonetheless, voluntary heirs may inherit only if mentioned in the will. In the absence of a provision in the wil, voluntary heirs will not inherit anything. In such cases, the free portion shall be disposed of to intestate heirs based in the order of priority as presented in Table 1-2 below: Legitimate chikiren or descendants Legitimate parents or ascendants Wegitimate children or descendants ‘Surviving spouse Brothers and sisters, nephews and nieces Other collateral relatives within the 5% degree State The distribution of free portion in intestate succession is based in the order of priority because in every inheritance, the relative nearest_in degree excludes the more distant ones, saving the right of representation when it properly takes place.Sacesion and. Tenof x“, | Collateral Relatives Consanguinity is the relation of persons descending from the stock or common ancestors. These persons are known as blood reas, and are said to be related by blood or consanguinity. It may be line. collateral. Lineal consanguinity, which may be descending oF asceng. is that which subsists between persons of whom one is descendes direct line from the other. Collateral consanguinity is that which su, between persons who have the same ancestors, but who not descenc ascend) one from the other. Proximity of relationship is determines by pune of generations. Each generation forms a degree. As illustr low ILLUSTRATION 7: Deter ing Blood Relationshij . Their i the son oF Damen Parents are A and B- © daughter of yond 10Succession and, Trans (ees A, C,G and M, in thet order, are relatives in the descending direct line, A to Cis one degree; from C to G is another degree and from G to mn another degre : N, J, D and 8, in that order, are relatives in the ascending direct line. C,G and M, are relatives of D, J and N in the collateral line. G is the niece of D, D is the uncle of G; J is the nephew of C, C is the aunt of J, Hand | are first cousins; they are four degrees apart, H to C, C to AB, AB tod and D tol. Mand N are second cousins; they are six degrs 6 apart. Because of G’s marriage to K, K becomes H's brother-in-law, H being G's brother. They become relatives by affinity. Affinity is the connection existing in consequence of a marriage between each of the married spouse and the kindred of the other. tc % ‘divide by the number of LC, whether they sunive alone or with concurring compulsory heir (CH) TU % ss % 2ormore LC % SS Equalto Lc _| Lc % ‘Allthe concurring CH get from the half free portion, the share of the SS 88 A having preference over that of the IC, whose share may suffer Ic %ot 1 LC _| reduction pro-rata because there is no preference among themselves LPA % ‘Whether they survive alone or with concurring CH LPA % IC succeed in the Yin equal shares Ic % UPA % ss % LPA % ss 118 Ic 14 iC 412, Divide equally among the IC $s 118 ic 1 3s 112 173 if marriage isin artculo mors and deceased spouse dies within 3 months afer the marriage P % : 7 iP Excluded | Children inhent in the amounis established i the foregoing rules Any child Itdepends, % Only the parents of IC are induded. Grandparents and other % ascondants are excluded. 1Successton dl Transp Ca STATE) ~ ILLUSTRATION 8 (LEGITIMEs an‘ Case A: Namaalam Nha died leaving an estate valued at P 12,000,000. The survivin, heirs were his spouse, 2 legitimate children and 1 illegitimate child : Required: Distrbute the estate by applying the rules on leitimes Answer: wr dietnbution of his estate should be as follows (Based on Table 1-3) Legitimate Children (1/2): 6,000,000 = Legitimate chiid#1 3,000,000 = Legitimate child # 2 3,000,000 Wegitimate child (1/2 of 1 LC) 1,500,000 Surviving Spouse (1/4) 3,000,000 Free Portion (remainder) 41,500,000 Total 12,000,000 NOTE: «The legitime of the legitimate children as provided in the table of legitime is & of the total estate (regardless of the number of legitimate children), «The legitime of an legitimate child is % ofthe lagiime of 1 legitimate child. «The legitime of the surviving spouse is % as provided in the table of legitime +The remaining portion in this particular case isthe free portion. It may be given by he testator to anyone in eccordance with his wishes. However, only those voluntary his | included in the provisions of the will should be recognized. | Case B: Assume the amount of estate is P12,000,000 and the decedent is survived only ty his two (2) illegitimate children. The distribution of the estate under intestate succession should be: legitimate Child (1/2); (P3M per IC.) 6,000,000 Free Portion (1/2) 00 Total P12, ; Case C: Assume the same data in Case B except that the vided 8,000,000 tc Ana (his secretary) through his last will and testament, Obviously, the legitimes of the two (2) ilegtimate chidren were impaired. The amount of estate left after deducting the 6,000,000 will nat be enough to satisfy the legitimes of the compulsory heirs amountind we Pennny pues Oe ‘amount to be given to the secretary should be modified } 100,000 to satisfy the lagitimes. Th fale coaiteu legit 16 distribution of the decedent's es! legitimate Child (112); (POM per LC.) 6,000, Secretary (66 Portion); (1/2) +000 900 Total 12,000,000 as——SSS ee Wills A will is an act whereby @ person is permitted, with the formalities prescribed by law, to control to a certain degree the dispocinen a estate to take effect after his death (Art. 783 NCC). It is a documet whereby a person, called the ‘testator’, disposes of his or her properties or “estate” to take effect upon his or her death, “ The making of a will is a strictly personal act. It cannot be left in whole or in part of the discretion of a third person, or accomplished through the instrumentality of an agent or attorney. All persans who are not expressly prohibited by law may make a will. The persons prohibited by law to make a will are those below 18 years old and those who are not of sound mind at the time of its execution The law presumes that every person is of sound mind, in the absence of proof to the contrary, The burden of proof that the testator was not of sound mind at the time of making his dispositions is on the person who opposes the probate of the will. if the testator, one month, or less, before making his will was publicly known to be insane, the person who maintains the validity of the will must prove that the testator made it during a lucid interval. 'Supervening incapacity does not invalidate an effective will, nor is the will of an incapable validated by the supervening of capacity. A married woman may make a will without the consent of her husband, and without the authority of the court. A married woman may dispose by will of all her separate property as well as her share of the conjugal partnership or absolute community property Kinds of Wills: 1. NOTARIAL OR ORDINARY OR ATTESTED WILL ~ is one which is executed in accordance with the formalities prescribed by Art. 804 to 808 of the New Civil Code. Requisites for a Valid Notarial Will a) It must be in writing and executed in a language or dialect known to the testator. 'b) It must be subscribed at the end thereof by the testator himself or by the testator's name written by some other person in his presence and by his express direction, c) It must be attested and subscribed by three or more credible witnesses in the presence of the testator and of one another. 13Succession and. Transfer Ty being witnesses to 4 will (Art, ty The ‘following are disqualified from NCC): » Any person not domiciled in the Philippines. = Those who have been convicted of falsific or false testimony. In the absence of bad faith, forgery. or fraud, or undue and improper pressure and influence, defects and imperfections in the form of attestation or in the language used therein shall not render the will invalid if it is proved that the will was in fact executed and attested in substantial compliance with all the requirements of the law. ation of a document, perjury ® Art.795 NCC: “The validity of a wil a to its form depends upon the observance of the lew in force at the time itis made.” HOLOGRAPHIC WILL-is a written will which must be entirely written Gated and signed by the hand of the testator himself. It subject to no Gther form and it may be made in or out of the Philippines and need one eT wimessed (Art. 811 NCC). In case of any insertion ‘cancellation, erasure or alteration in a holographic will, the testator must authenticate the same by his full signature. Codicil is a supplement or addition to a will, made after the execution of a will and annexed to be taken as a part thereof, by which any aispoaton made in the original will is explained, added to altered. In order thata codicil may be effective, i ' as in the case of a will (Arts.825 and 826) shall be executed ata » PROBATE OF A WILL is a court procedure Tae eth poe valid or (eso al pa invalid. In the probate of a holographic will, nates sta be necessary that at /east one witness proven thal al the tr 0 knows the handwriting and signature of tame te at wi ie agen explicitly declare that the will and and testament is ure are in the handwriting of the legal and vaid in testator. a court’ The proceedings in the absence of a last will and test: Ee proceedings” ament is called “intestateForeign Wills The will of an alien who is abroad produces effect in th Philippines if made with the formalities prescribed by the law of the pa in which he resides, or according to the formalities observed in his country, or in conformity with those which the Philippine civil code prescribes. A will made in the Philippines by a citizen or subject of another country, which is executed in accordance with the law of the country of which he is a citizen or subject, and which might be proved and allowed by the law of his own country, shall have the same effect as if executed according to the laws of the Philippines. When a Filipino is in a foreign country, he is authorized to make a will in any of the forms established by the law of the country in which he may be. Such will may be probated in the Philippines (Art. 815 NCC). Revocation of wills and testamentary dispositions Awill may be revoked by the testator at any time before his death any waiver or restriction of this right is void (Art. 828). A revocation done outside the Philippines, by a person who does not have his domicile in the Philippines, is valid when it is done according to the law of the place where the will was made, or according to the law of the place in which the testator had his domicile at the time and if the revocation takes place the Philippines when it is in accordance with the provisions of the new civil code. MODES OF REVOKING A WILL: 1) By implication of law 2) By some will, codicil, or other writing executed as provided in case of wills 3) By buming, tearing, cancelling, or obliterating the will with the intention of revoking it, by the testator himself, or by some other person in his presence, and by his express direction. If burned, torn, cancelled, or obliterated by some other person, without the express direction of the testator, the will may still be established, and the estate distributed in accordance therewith, if its contents, and due execution, and the fact of its unauthorized destruction, cancellation, or obliteration are established according to the Rules of Court.y w Subsequent wills which do not Art. 837 NCC: revoke the previous ones in an express “ifafter making a wil, the manner, annul only such dispositions in the testator makes a second prior wills as are inconsistent with or will expressly revoking contrary to those contained in the latter the first, the revocation wills, A revocation made in a subsequent will of the second will does shall take effect, even if the new will should not revive the frst will, become inoperative by reason of the which can be revived incapacity of the heirs, devisees or legates only by another will or gecignated therein, or by their renunciation. eet ‘A revocation of a will based on a false cause or an illegal cause is null and void. Institution of heir (Art. 840) Institution of an heir is an act by virtue of which a testator designates in his will the person or persons who are to succeed him in his property and transmissible rights and obligations. A will shall be valid even though it should not contain an institution of an heir, or such institution should not comprise the entire estate, and even though the person so instituted should not accept the inheritance or should be incapacitated to succeed. In such cases the testamentary dispositions made in accordance with law shall be complied with and the remainder of the estate shall pass to the legal heirs. A compulsory heir may, in consequence of disinheritance, be deprived of his legitime, for causes expressly stated by law. Disinheritance can be effected only through a will wherein the legal cause therefore shall be specified. The burden of proving the truth of the cause for disinheritance shall rest upon the other heirs of the testator, if the disinherited heir should deny it. Disinheritance _Disinheritance is a testamentary disposition by which a conipulsory heir is deprived of, or excluded from the inheritance to which he has a right. Disinheritance is not applicable to voluntary heirs. REQUISITES for Disinheritance: 1. Effected only through a valid will For a cause expressly stated by law Cause must be stated in the will itself 2 3. 4. Cause must be certain and true5. Unconditional 6. Total (there is no partial disinheritance) 7. The heir disinherited must be designated in such a manner that there can be no doubt as to his identity As stated above, the ground(s) or cause(s) of disinheritance shall be limited to those expressly stated by law. Under Art. 850 of the new civil code, the burden of proving the truth of the cause for disinheritance shall rest upon the other heirs of the testator, if the disinherited heir should deny it. Disinheritance without a specification of the cause, or for a cause the truth of which, if contradicted, is not proved, or which is not one of those set forth in civil code, shall annul the institution of heirs insofar as it may prejudice the person disinherited, The devises and legacies and other testamentary dispositions shall be art, 856NCC valid to such extent as will not impair subsequent the legitime. The children and reconciliation between the descendants of the person disinherited : offender and the offended person shall take his or her place and shall # deprives the latter of the right to preserve the rights of compulsory heirs : disinherit, and renders ineffectual with respect to the legitime; but the any disinheritance that may have disinherited parent shall not have the ; been made.” usufruct or administration of the property which constitutes the legitime. COMMON CAUSES FOR DISINHERITANCE of children or descendants, parents or ascendants, and spouse: 4. When the heir has been found guilty of an attempt against the life of the testator, his/her descendants or ascendants, and spouse in case of children and parents; 2. When the heir has accused the testator ofa crime for which the law prescribes imprisonment for 6 years or more, if the accusation has been found groundless; 3. When the heir by fraud, violence, intimidation or undue influence causes the testator to make a will or to change one already made; 4. Refusal without justifiable cause to support the testator who disinherits such heir. Peculiar Causes for Disinheritance 1. CHILDREN/DESCENDANTS: a. When the child or descendant has been convicted of adultery or concubinage with the spouse of the testator;Succession and: Transpo Taxes b. Maltreatment of the testator by word or deed by the child/descendant; - ; ¢. When the child or descendant leads a dishonorable or disgraceful life; ; - d. When the child or descendant is convicted of a crime which carries with it a penalty of civil interdiction. 2. PARENTS/ASCENDANTS: , ; a. When the parents have abandoned their children or induced their daughters to live a corrupt or immoral life, or attempted against their virtue; - b. When the parent or ascendant has been convicted of adultery or concubinage with the spouse of the testator; 2 c. Loss of parental authority for causes specified in the Civil Code; and d. Attempt by one of the parents against the life of the other, unless there has been reconciliation between them. 3. SPOUSE: j@. When the spouse has given cause for legal separation; b. When the spouse has given grounds for loss of parental authority. ~ Right of Representation It a “right” created by fiction of law where the representative is raised to the place and degree of the person represented, and acquires the rights which the latter would have if he were living or could have inherited. Representation may arise either because of: 1. Death 2. Incapacity 3. Disinheritance The representative(s) shall not inherit more than what the person they represent would inherit, if he were living or could inherit. (Art. 974). The law further provides that “representation” is not a available to: 4. As to compulsory heirs: In case of repudiation, the one who repudiates his inheritance cannot be represented, Their own heirs inherit in their own right. As to voluntary heirs Voluntary heirs, legates and devisees who a. Predecease the testator; or b. Renounce the inheritance cannot be represented by their own heirs, with respect to their supposed inheritance. enSeccesion and Tocnsfer Tapes beers sa “This rule applies only when the decedent does ot descendants. Nephews and nieces already alive when the aunt ro cle died can inherit by representing thelr predeceased partis, iE a cr rces are legitimate, then they are prohibited by te E92 of the new civil code from inheriting from the relatives of their 28? ol her tke their uncles or aunts, or even from tol, father ‘Grandnephews and grandnieces in the -collateral line Cannot inherit by right of representation. 19