Gregorio vs. Madarang

A lot alleged to have been donated by the decedent to a compulsory heir during the decedent’s lifetime must be included in the estate inventory for purposes of collation or advancement; questions of advancement to an heir, and of ownership for that limited purpose, may be heard and determined by the court having jurisdiction of the estate proceedings under Article 1061 of the Civil Code and Section 2, Rule 90 of the Rules of Court.

Casimiro V. Madarang, Sr. and his wife Dolores had five children: Casimiro Jr., Jose, Ramiro, Vicente, and Corazon. Casimiro Sr. died intestate on June 3, 1995, leaving real and personal properties with an estimated value of ₱200,000.00. Intestate proceedings were filed by Jose before the Regional Trial Court of Cebu City, Branch 57, and Dolores was appointed administratrix. The governing provisions invoked in the inventory dispute were Article 1061 of the Civil Code, requiring collation by compulsory heirs, and Section 2, Rule 90 of the Rules of Court, governing questions of advancement.

Casimiro V. Madarang, Sr. died intestate on June 3, 1995, survived by his wife Dolores and their five children: Casimiro Jr., Jose, Ramiro, Vicente, and Corazon. His estate consisted of real and personal properties with an estimated value of ₱200,000.00. Following the intestate proceedings filed by Jose before the Regional Trial Court of Cebu City, Branch 57, Dolores was appointed administratrix and submitted an Inventory Report.

Jose filed a Comment on the Report alleging that it omitted six lots, among them Lot 829-B-4-B located in Cebu City and covered by Transfer Certificate of Title No. 125429. A hearing was conducted to determine whether those six lots formed part of the decedent’s estate. By Order of April 5, 2002, the RTC directed Dolores to revise the inventory to include all six lots, relying on Article 160 of the New Civil Code and the presumption that properties acquired after the spouses’ marriage on December 27, 1931 and during the coverture belonged to the conjugal partnership.

Dolores and the children, except Jose, questioned the order. During the pendency of their motion for reconsideration, Corazon was appointed co-administratrix. Because the oppositors alleged that the six lots had been transferred during the decedent’s lifetime, they were ordered to submit affidavits in lieu of oral testimony. Only Vicente complied. He declared that Lot 829-B-4-B was conveyed to him by a Deed of Donation executed in August 1992 by his parents, Dolores and Casimiro, Sr. Petitioners later manifested that they no longer opposed the provisional inclusion of the six lots except Lot 829-B-4-B.

By Order of January 20, 2003, the RTC modified its earlier order to exclude Lot 829-B-4-B from the inventory and directed Dolores to submit a revised inventory and accounting. Jose moved for reconsideration, arguing that the lot should not be excluded because the title remained registered in his parents’ names and the deed of donation in Vicente’s favor was neither notarized nor registered with the Register of Deeds. The motion was denied on February 5, 2003, and Jose filed a Notice of Appeal.

Before the Court of Appeals, Jose maintained that the RTC should have kept the lot in the inventory so that Vicente could file an ordinary action in which its ownership could be threshed out. Jose later moved to withdraw the petition; the oppositors opposed the withdrawal on the ground that its grant would “end” the administration proceedings. The appellate court granted the withdrawal by Resolution of January 18, 2008. On reconsideration, the Court of Appeals denied the motion in its Resolution of November 6, 2008 and affirmed the RTC’s exclusion. It stated that the parties had interposed no objection to the non-inclusion of Lot 829-B-4-B and had therefore consented to it, and it noted that Vicente and his family had been in continuous, actual, and physical possession for over twenty years, that his house stood on the lot, and that his ownership had been fully recognized by the Madarang clan except for Jose’s belated objection. During the pendency of the present petition, Casimiro Jr. died and was substituted by his wife Estrelita and children Consuelo, Casimiro IV, and Jane Margaret.

• Appellate Review Beyond Jurisdiction: Petitioners contended that since the only issue for consideration by the appellate court was the merit of Jose’s “Motion to Withdraw Petition,” that court exceeded its jurisdiction when it passed upon the merits of Jose’s appeal from the RTC order excluding Lot 829-B-4-B from the Inventory.
• Lack of Consent to Exclusion: Petitioners questioned the appellate court’s finding that the parties interposed no objection to the non-inclusion of Lot 829-B-4-B and therefore consented to it, maintaining that no accord existed among the parties respecting its exclusion.
• Opposition to Withdrawal: Petitioners opposed Jose’s “Motion to Withdraw Petition” before the appellate court on the ground that its grant would “end” the administration proceedings.

• Inclusion for Separate Ownership Action: Respondent Jose argued before the Court of Appeals that the RTC erred in excluding Lot 829-B-4-B from the inventory because the lower court should have maintained the inclusion so that Vicente could file an ordinary action where its ownership could be threshed out.
• Defects in the Deed: In moving for reconsideration of the January 20, 2003 RTC Order, respondent Jose argued that the lot should not be excluded because its title remained registered in his parents’ names and the Deed of Donation in Vicente’s favor was neither notarized nor registered with the Register of Deeds.
• Ownership by Donation: Respondent Vicente’s claim of ownership over Lot 829-B-4-B rested on a Deed of Donation executed in August 1992 by his parents.

• Appellate Review: Whether the Court of Appeals exceeded its jurisdiction in passing upon the merits of the RTC order excluding Lot 829-B-4-B when the only pending matter was Jose’s “Motion to Withdraw Petition.”
• Consent to Exclusion: Whether the Court of Appeals correctly found that the parties interposed no objection to the non-inclusion of Lot 829-B-4-B and therefore consented to the exclusion.
• Inclusion for Collation: Whether Lot 829-B-4-B, alleged to have been donated to compulsory heir Vicente during the decedent’s lifetime, should be excluded from the inventory of the decedent’s estate.

• Appellate Review: No. The appellate court did not err because petitioners’ own motion for reconsideration expressly prayed for a decision resolving the merits of Jose’s partial appeal.
• Consent to Exclusion: No. The voluminous records showed that there was no accord among the parties respecting the exclusion of Lot 829-B-4-B.
• Inclusion for Collation: No. The lot should not be excluded; it must be included in the inventory for purposes of collation or advancement under Article 1061 of the Civil Code and Section 2, Rule 90 of the Rules of Court.

• Appellate Review: Although petitioners claimed that the Court of Appeals exceeded its jurisdiction, they themselves raised the propriety of the RTC order excluding Lot 829-B-4-B in their Motion for Reconsideration and expressly prayed for a decision resolving the merits of Jose’s partial appeal. The issue was therefore properly before the appellate court, and no jurisdictional error attended its resolution.
• Consent to Exclusion: A review of the voluminous records revealed that, contrary to the appellate court’s statement, there was no accord among the parties respecting the exclusion of Lot 829-B-4-B. The finding of consent was therefore inaccurate, but the legal question remained whether the lot should be included because it was alleged to have been donated to a compulsory heir.
• Inclusion for Collation: While a probate court, being of special and limited jurisdiction, cannot generally act on questions of title and ownership, it may make a provisional determination of ownership for purposes of inclusion or exclusion in the inventory. Here, however, the facts did not call for a provisional determination because the question was one of collation or advancement by the decedent to an heir, over which the probate court may pass upon questions of title and ownership. Vicente’s claim rested on a deed of donation from his father and mother. Article 1061 of the Civil Code requires every compulsory heir who succeeds with other compulsory heirs to bring into the mass of the estate any property received from the decedent during the decedent’s lifetime by donation or other gratuitous title. Section 2, Rule 90 of the Rules of Court expressly authorizes the court having jurisdiction of the estate proceedings to hear and determine questions as to advancement made, or alleged to have been made, by the deceased to any heir. By express provision of law, therefore, Lot 829-B-4-B should not have been excluded from the inventory.

• Probate court’s jurisdiction over title and ownership — A probate court, being of special and limited jurisdiction, cannot act on questions of title and ownership; it may, however, make a provisional determination of ownership for purposes of inclusion or exclusion in the inventory of a decedent’s properties, without prejudice to a final determination through a separate action in a court of general jurisdiction. In this case, the Court clarified that the controverted matter was not merely a provisional ownership determination but one of collation or advancement, which the probate court could hear and determine.
• Collation or advancement — Under Article 1061 of the Civil Code, every compulsory heir who succeeds with other compulsory heirs must bring into the mass of the estate any property or right received from the decedent during the latter’s lifetime by way of donation or other gratuitous title, so that it may be computed in determining the legitime of each heir and in the account of partition. Section 2, Rule 90 of the Rules of Court provides that questions as to advancement made, or alleged to have been made, by the deceased to any heir may be heard and determined by the court having jurisdiction of the estate proceedings, and the final order binds the person raising the questions and the heir. The lot allegedly donated to a compulsory heir therefore remained subject to inclusion in the decedent’s estate inventory.

• "While a probate court, being of special and limited jurisdiction, cannot act on questions of title and ownership, it can, for purposes of inclusion or exclusion in the inventory of properties of a decedent, make a provisional determination of ownership, without prejudice to a final determination through a separate action in a court of general jurisdiction." — This passage states the general rule defining the probate court’s limited but real authority over ownership questions for inventory purposes.
• "The facts obtaining in the present case, however, do not call for the probate court to make a provisional determination of ownership of Lot 829-B-4-B. It bears stress that the question is one of collation or advancement by the decedent to an heir over which the question of title and ownership can be passed upon by a probate court." — This excerpt articulates the ratio decidendi distinguishing the case from the general provisional-ownership rule.
• "Article 1061. Every compulsory heir, who succeeds with other compulsory heirs, must bring into the mass of the estate any property or right which he may have received from the decedent, during the lifetime of the latter, by way of donation, or any other gratuitous title, in order that it may be computed in the determination of the legitime of each heir and in the account of partition." — This statutory passage is the controlling substantive basis for requiring inclusion of the donated lot.

• Reyes vs. Hon. Regional Trial Court of Makati, Branch 142, G.R. No. 165744, August 11, 2008, 561 SCRA 593 — Cited as authority that a probate court may pass upon questions of title and ownership where the issue is one of collation or advancement by the decedent to an heir.

• Article 160, New Civil Code — Applied by the RTC to presume that properties acquired by the spouses during their marriage belonged to the conjugal partnership; this presumption supported the initial inclusion of the six lots in the inventory.
• Article 1061, Civil Code — Required compulsory heirs to bring into the mass of the estate property received from the decedent by donation or other gratuitous title, so it may be computed in determining the legitime of each heir and in the account of partition; applied to require inclusion of Lot 829-B-4-B.
• Section 2, Rule 90, Rules of Court — Authorized the court having jurisdiction of the estate proceedings to hear and determine questions as to advancement made, or alleged to have been made, by the deceased to any heir, with the final order binding on the person raising the questions and on the heir.

Reynato S. Puno, Chief Justice; Teresita J. Leonardo-De Castro; Lucas P. Bersamin; Martin S. Villarama, Jr.