Ermac vs. Medelo

A probate court may approve a project of partition and proceed with the summary settlement of an estate notwithstanding that a property included therein is claimed by an heir or third party in a separate civil action, the claimant's recourse being to prosecute the independent action and secure an annotation of lis pendens on the title, with the distribution always subject to the outcome of that suit.

The deceased spouses Potenciano Ermac and Anastacia Mariquit left a single parcel of land — Lot 1327, Cad. 292, covered by OCT No. RP-355 (262) of the Register of Deeds of Iligan City, with an assessed value of ₱590.00 — as the only property to be inherited by their heirs. Private respondent Cenon Medelo is one of the grandchildren of the spouses, being a child of their predeceased daughter Digna Ermac. Petitioner Pedro Ermac is one of the surviving children of the deceased spouses. The dispute arose within the framework of a summary settlement of the intestate estate under the Rules of Court, a proceeding designed for small estates and dispensing with the appointment of an administrator.

The deceased spouses Potenciano Ermac and Anastacia Mariquit left as their only property a parcel of land designated as Lot 1327, Cad. 292, covered by OCT No. RP-355 (262) of the Register of Deeds of Iligan City, with an assessed value of ₱590.00. Their heirs included their surviving children — among them petitioner Pedro Ermac — and the children of their predeceased daughter Digna Ermac, among them private respondent Cenon Medelo. Medelo filed a petition for summary settlement of the intestate estate before the Court of First Instance of Lanao del Norte, docketed as Special Proceedings No. 1517. All requirements having been complied with and no opposition having been interposed, the respondent court, on January 21, 1970, issued an order granting the petition, enumerating all the heirs entitled to participate in the inheritance and ordering the submission of the proper project of partition of the lot.

On February 2, 1970, Pedro Ermac moved for reconsideration of the order of settlement, praying for the elimination of Lot 1327 from the estate on the ground that the property belonged to him and his wife. The motion was denied, the court ruling that the proper remedy was a separate suit. Accordingly, Pedro Ermac, together with his children Elena, Carlos, Antonio, Luciano, Hilario, Indalecio, and Francisca, all surnamed Ermac, filed Civil Case No. 1564 in the Court of First Instance of Lanao del Norte to assert their claim of ownership over Lot 1327.

Notwithstanding the pendency of Civil Case No. 1564, the respondent court, upon submission of the project of partition, approved the same on June 25, 1970, over Pedro Ermac's objection. His motion for reconsideration was denied by order of July 15, 1970. Pedro Ermac and his children then elevated the matter to the Supreme Court via a petition for certiorari, seeking to set aside both the order approving the project of partition and the order denying reconsideration, on the ground that the respondent court exceeded its jurisdiction or gravely abused its discretion in approving a partition that covered property claimed in a separate civil action as belonging to the petitioners and not to the estate.

• Grave Abuse of Discretion: Petitioners contended that the respondent court exceeded its jurisdiction or gravely abused its discretion in approving the project of partition covering Lot 1327 notwithstanding that the property was being claimed by petitioners in a separate civil action, Civil Case No. 1564, as their own and not part of the estate.

• Reliance on Gutierrez vs. Cruz: Petitioners relied on the case of Gutierrez vs. Cruz, 24 SCRA 69, in support of their position that the pendency of an adverse ownership claim should preclude approval of the partition.

• Probate Court Jurisdiction: Whether the respondent court exceeded its jurisdiction or gravely abused its discretion in approving the project of partition covering Lot 1327 notwithstanding that it is being claimed by petitioners in a separate civil action as their property and not of the estate.

• Probate Court Jurisdiction: No. The probate court did not exceed its jurisdiction or gravely abuse its discretion. The policy of the law is to terminate estate proceedings with the least loss of time, especially in summary settlements, and an adverse claim of ownership over property included in the estate should be ventilated in an independent action, with the distribution proceeding subject to the results of that suit.

• Probate Court Jurisdiction: The law's policy is to terminate proceedings for the settlement of estates of deceased persons with the least loss of time, a principle especially applicable to small estates for which the Rules provide a summary procedure dispensing with the appointment of an administrator and other cumbersome steps. The probate court is not the best forum for resolving adverse claims of ownership over property ostensibly belonging to the decedent's estate. While there are settled exceptions to this rule as applied to regular administration proceedings, it is not proper to delay the summary settlement of a deceased person's estate merely because an heir or third person claims that certain properties do not belong to the estate but to him. Such a claim must be ventilated in an independent action, and the probate court should proceed to distribution if there are no other legal obstacles, since the distribution must always remain subject to the results of the separate suit. For the protection of the claimant, the appropriate step is to have a proper annotation of lis pendens entered on the title. The case of Gutierrez vs. Cruz, relied upon by petitioners, was distinguished because it did not involve a summary settlement.

• Probate Court's Lack of Jurisdiction over Adverse Claims of Ownership — The probate court is not the best forum for the resolution of adverse claims of ownership over property ostensibly belonging to the decedent's estate. Such claims must be ventilated in an independent action. In this case, the Court applied this doctrine to summary settlement proceedings specifically, holding that the pendency of a separate civil action claiming ownership over a property included in the estate does not preclude the probate court from approving the project of partition, since the distribution remains subject to the outcome of the independent suit.

• Policy of Summary Settlement of Small Estates — The law favors the termination of estate settlement proceedings with the least loss of time, particularly for small estates, for which the Rules provide a summary procedure dispensing with the appointment of an administrator and other involved and cumbersome steps. It is improper to delay summary settlement merely because an heir or third person claims ownership over property included in the estate.

• Lis Pendens as Protection for the Claimant — Where a claimant asserts ownership over property included in an estate settlement in a separate action, the appropriate protective measure is to have a proper annotation of lis pendens entered on the title covering the disputed property, ensuring that the distribution remains subject to the results of the independent suit.

• "Definitely, the probate court is not the best forum for the resolution of adverse claims of ownership of any property ostensibly belonging to the decedent's estate." — This passage articulates the fundamental doctrinal principle that probate courts lack jurisdiction to adjudicate adverse claims of ownership, a rule central to the ratio decidendi.

• "it is not proper to delay the summary settlement of a deceased person just because an heir or a third person claims that certain properties do not belong to the estate but to him. Such claim must be ventilated in an independent action, and the probate court should proceed to the distribution of the estate, if there are no other legal obstacles to it, for after all, such distribution must always be subject to the results of the suit." — This passage establishes the specific rule for summary settlements: that adverse ownership claims do not warrant delaying distribution, provided the claimant prosecutes an independent action and the distribution remains subject to that suit's outcome.

• Bernardo vs. Court of Appeals, 7 SCRA 367 — Cited as authority for the proposition that the probate court is not the best forum for the resolution of adverse claims of ownership of property ostensibly belonging to the decedent's estate.

• Guzman vs. Anog, 37 Phil. 61 — Cited as authority for the settled exceptions to the rule that probate courts cannot resolve ownership claims, as applied to regular administration proceedings.

• Gutierrez vs. Cruz, 24 SCRA 69 — Relied upon by petitioners but distinguished and effectively disregarded, as that case did not involve a summary settlement and thus did not support the proposition that summary settlement should be delayed by an adverse ownership claim.

• Rules of Court — Summary Settlement of Estate — The Court invoked the policy underlying the summary settlement procedure for small estates, which dispenses with the appointment of an administrator and other cumbersome steps ordinarily required in estate proceedings. The specific rule was applied to hold that the summary settlement should proceed notwithstanding an adverse ownership claim, with distribution subject to the outcome of a separate action.

Fernando (Chairman), Antonio, Aquino, and Concepcion Jr., JJ., concurred.