Jakosalem vs. Rafols

An heir's sale of hereditary property while the estate is under judicial administration is valid and takes effect as to the portion ultimately adjudicated to the heir in partition. Once partition confirms the property to the selling heir, the sale of the whole is entirely confirmed, and any subsequent conveyance by the heir of the same property to another party is without effect.

The land in question originally belonged to Juan Melgar, whose estate was placed under judicial administration from 1915 until December 2, 1924. His daughter Susana Melgar was one of his heirs and, during the pendency of the administration, sold the land with a right of repurchase to Pedro Cui, retaining possession as lessee. The dispute concerns the validity of that sale and its effect on a subsequent conveyance by Susana Melgar to Nicolasa Rafols, made after the partition of the estate had already adjudicated the land to Susana. Pedro Cui later donated the land to the plaintiff-appellant Generosa Teves de Jakosalem, who succeeded to Cui's rights in the litigation.

The land in question originally belonged to Juan Melgar, who died while his estate was under judicial administration commenced in 1915 and concluded on December 2, 1924. During the pendency of that administration, on July 5, 1917, Susana Melgar, a daughter of the deceased, sold the land to Pedro Cui with a right of repurchase, subject to the stipulation that during the repurchase period she would continue in possession of the land as lessee of the purchaser.

On December 12, 1920, the partition of the estate of Juan Melgar was made, and the land in question was adjudicated to Susana Melgar. In 1921, she conveyed one-half of the land to the defendant-appellee Nicolasa Rafols in payment of professional fees. Rafols entered upon the portion thus conveyed and has remained in possession thereof up to the present.

On July 23, 1921, Pedro Cui brought an action to recover the one-half of the land from Nicolasa Rafols and the other half from the other defendants. While that case was pending, on or about August 4, 1925, Pedro Cui donated the whole land in question to Generosa Teves de Jakosalem, the plaintiff-appellant. After trial, the lower court rendered a decision absolving Nicolasa Rafols as to the one-half of the land conveyed to her by Susana Melgar, and declaring the plaintiff owner of the other half but with express acknowledgment of the other defendants. The plaintiff appealed from that part of the judgment favorable to Nicolasa Rafols.

The lower court absolved Rafols upon the theory that Susana Melgar could not have validly sold the land to Pedro Cui because the land was then in custodia legis, that is, under judicial administration. The Supreme Court found this to be error.

• Validity of Sale During Estate Administration: Whether an heir may validly sell hereditary property while the estate is under judicial administration.
• Effect of Partition on Prior Sale: Whether the partition of the estate adjudicating the land to the selling heir confirms the prior sale and defeats a subsequent conveyance.
• Priority of Possession in Double Sale: Whether Pedro Cui's possession, through Susana Melgar as lessee, has priority over Nicolasa Rafols's possession for purposes of resolving a double sale.
• Prescription: Whether the action against Nicolasa Rafols has prescribed.

• Validity of Sale During Estate Administration: Yes. An heir may sell his or her right, interest, or participation in property under administration, as such sale does not interfere with the court's possession or the administration proceedings.
• Effect of Partition on Prior Sale: The sale was confirmed in its entirety. Because the partition of December 12, 1920 adjudicated the land to Susana Melgar, the sale of the whole land to Pedro Cui was entirely confirmed, rendering her subsequent conveyance to Nicolasa Rafols in 1921 without effect.
• Priority of Possession in Double Sale: Pedro Cui's possession is prior. Susana Melgar's possession as lessee of Pedro Cui is deemed Pedro Cui's possession, which commenced before Rafols's entry in 1921.
• Prescription: No. Pedro Cui filed the first complaint in 1921, the year following the confirmation of the sale in his favor, so the action had not prescribed.

• Validity of Sale During Estate Administration: The lower court erred in holding that the land could not be sold because it was in custodia legis. While ordinary execution of property in custodia legis is prohibited to avoid interference with the court's possession, a sale made by an heir of his share in an inheritance, subject to the result of the pending administration, in no wise stands in the way of such administration. Article 440 of the Civil Code provides that possession of hereditary property is deemed transmitted to the heir without interruption from the instant of the decedent's death, if the inheritance is accepted. Manresa explains that upon death, each heir becomes the undivided owner of the whole estate with respect to the portion that may be adjudicated to him, forming a community of ownership among co-owners while the estate remains undivided. Article 399 of the Civil Code permits every part owner to assign or mortgage his part in the common property, with the effect limited to the portion allotted to him in the partition upon dissolution of the community. In Ramirez vs. Bautista, 14 Phil. 528, where some heirs sold property left by their deceased father without the concurrence of the others, the sale was held valid but limited to the share that might be allotted to the vendors upon partition.

• Effect of Partition on Prior Sale: The sale made by Susana Melgar in favor of Pedro Cui was valid but effective only as to the portion to be adjudicated to the vendor upon partition. When, on December 12, 1920, the partition adjudicated the land in question to Susana Melgar, the sale of the whole land to Pedro Cui was entirely confirmed. Upon such confirmation, the subsequent conveyance by Susana Melgar to Nicolasa Rafols in 1921 could no longer be validly made, as Susana had already parted with the property.

• Priority of Possession in Double Sale: Even under the rule on double sale, where neither purchaser has registered, the first in possession should be preferred. When the sale to Pedro Cui was confirmed on December 12, 1920, Susana Melgar was in possession of the land as his lessee, and this possession should be considered as that of Pedro Cui. Nicolasa Rafols's possession commenced only in 1921, subsequent to that of Pedro Cui.

• Prescription: Nicolasa Rafols may not allege prescription, as Pedro Cui filed the first complaint in 1921, the year following the confirmation of the sale in his favor. Since Rafols deprived Pedro Cui of possession and enjoyment of one-half of the land from 1921 to the present, an indemnity is warranted. Six per cent of ₱1,500, the price of one-half of the land, yielding ₱90 per year, was deemed a reasonable amount of indemnity.

• Validity of Heir's Alienation of Hereditary Property During Administration — An heir may validly sell, assign, or mortgage his or her share or participation in hereditary property even while the estate is under judicial administration. The prohibition against execution of property in custodia legis does not extend to voluntary alienation by an heir of his hereditary share, because such alienation does not interfere with the court's possession or the administration proceedings. The effect of the alienation is limited to the portion ultimately adjudicated to the heir in partition, but once partition confirms the property to the selling heir, the sale is entirely confirmed.

• Community of Ownership Among Co-Heirs — Upon the death of a person, each heir becomes the undivided owner of the whole estate with respect to the portion that may be adjudicated to him, forming a community of ownership among co-owners while the estate remains undivided. Possession of hereditary property is deemed transmitted to the heir without interruption from the instant of the decedent's death, provided the inheritance is accepted. (Based on Article 440 of the Civil Code and Manresa's commentary.)

• Priority in Double Sale Without Registration — In case of a double sale where neither purchaser has registered the sale, the purchaser first in possession is entitled to preference. A vendor's possession as lessee of the first purchaser is deemed the first purchaser's possession for purposes of determining priority.

• "That the land could not ordinarily be levied upon while in custodia legis, does not mean that one of the heirs may not sell the right, interest or participation which he has or might have in the lands under administration." — This passage articulates the central ratio decidendi: the distinction between prohibition of execution on property in custodia legis and the validity of an heir's voluntary alienation of his hereditary share.

• "the sale made by Susana Melgar in favor of Pedro Cui was valid, but it would be effective only as to the portion to be adjudicated to the vendor upon the partition of the property left by her deceased father Juan Melgar." — This formulation states the rule that an heir's sale of hereditary property during administration is valid but limited in effect to the share ultimately adjudicated to the selling heir, a principle derived from Article 399 of the Civil Code.

• "Upon the confirmation of the sale of December 12, 1920 in favor of Pedro Cui, the conveyance by Susana Melgar in favor of Nicolasa Rafols in 1921 could no longer be done." — This establishes the consequence of partition confirming a prior sale: the selling heir is divested of authority to make any further conveyance of the same property.

• Alcala vs. Alcala, 35 Phil. 679 — Cited in support of Manresa's doctrine that upon the decedent's death, each heir becomes the undivided owner of the whole estate with respect to the portion that may be adjudicated to him, forming a community of ownership among co-owners while the estate remains undivided.
• Ramirez vs. Bautista, 14 Phil. 528 — Controlling authority for the rule that a sale of hereditary property by some heirs without the concurrence of the others is valid, but its effect is limited to the share that may be allotted to the vendors upon partition of the estate. The opinion was written by then Chief Justice Cayetano Arellano.

• Article 440, Civil Code (old) — Provides that possession of hereditary property is deemed transmitted to the heir without interruption from the instant of the decedent's death, in case the inheritance is accepted. Applied to establish that Susana Melgar possessed hereditary rights in the land from the moment of her father's death, notwithstanding the pendency of estate administration.
• Article 399, Civil Code (old) — Provides that every part owner may assign or mortgage his part in common property, with the effect of such assignment or mortgage limited to the portion that may be allotted to him in the partition upon dissolution of the community. Applied to validate Susana Melgar's sale to Pedro Cui, with the sale's effect confined to the share ultimately adjudicated to her in the partition of December 12, 1920.

Yulo, C.J., Ozaeta, Paras, and Bocobo, JJ., concurred.