SPEC PRO -PRE WEEK 2019 by Dean Festin PDF

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2019 PRE-WEEK SYLLABUS-BASED BAR REVIEW GUIDEINSPECIAL PROCEEDINGSBy Dean Gemy Lito L. FestinPUP COLLEGE OF LAW*(Taken from soon to be released 2020 Edition of Special Proceedings: A foresight to the bar exam and the practice of Law)___________________________________RULE 72 - [BAR Q. 1996,1998,2008...

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2019 PRE-WEEK SYLLABUSBASED BAR REVIEW GUIDE IN

SPECIAL PROCEEDINGS By Dean Gemy Lito L. Festin PUP COLLEGE OF LAW *(Taken from soon to be released 2020 Edition of Special Proceedings: A foresight to the bar exam and the practice of Law)

3.

ARE THE RULES IN CIVIL ACTIONS APPLICABLE IN SPECIAL PROCEEDINGS?

Yes, in the absence of special provisions, the rules provided for in ordinary actions shall be, as far as practicable, applicable in special proceedings. (Section 2, Rule 72 of the Rules of Court) 4. ALAN JOSEPH A. SHEKER v. ESTATE OF ALICE O. SHEKER, VICTORIA S. MEDINA (G.R. No. 157912, December 13, 2007)

___________________________________ RULE 72 - [BAR Q. 1996,1998,2008,2012] SUBJECT MATTER AND APPLICABILITY OF GENERAL RULES 1. DEFINE SPECIAL PROCEEDING. It is an application to establish the status or right of a party or a particular fact or any remedy other than an ordinary suit in a court of justice.

DOCTRINE: Provisions of the Rules of Court requiring a certification of non-forum shopping for complaints and initiatory pleadings, a written explanation for nonpersonal service and filing, and the payment of filing fees for money claims against an estate would not in any way obstruct probate proceedings, thus, they are applicable to special proceedings such as the settlement of the estate of a deceased person as in the present case.

2. DISTINGUISH CIVIL ACTION FROM SPECIAL PROCEEDING. 1. A special proceeding under the same rule provides that it is a remedy by which a party seeks to establish a status, a right or a particular fact. Pursuant to Section 3, Rule 1 of the 1997 Rules of Civil Procedure, a civil action is one by which a party sues another for the enforcement or protection of a right, or the prevention or redress of a wrong. 2. Unlike actions, a special proceeding is generally commenced by application, petition or special form of pleading as may be provided for by the particular rule or law. 3. Unlike actions, in special proceedings, it does not pray for affirmative relief for injury arising from a party’s wrongful act or omission nor state a cause of action that can be enforced against any person.

RULE 73- [BAR Q. 2003, 2005, 2011] SETTLEMENT OF ESTATE OF DECEASED PERSONS 1.

WHICH COURT HAS JURISDICTION OVER PROBATE PROCEEDING?

Pursuant to R.A. 7691, the question as to which court shall exercise jurisdiction over probate proceedings depends upon the gross value of the estate of the decedent. In Metro Manila, the Municipal Trial Court has jurisdiction on the said proceeding if the value of the estate does not exceed P400,000.00, otherwise, the Regional Trial Court has jurisdiction over the same. Outside Metro Manila, Municipal Trial Courts, Metropolitan Trial Courts and Municipal Circuit Trial Courts have jurisdiction over probate proceedings if the gross value of the estate left by the decedent does not exceed P300,000.00.

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RULE 75- [BAR Q. 2005, 2006, 2010, 2014] 2.

VENUE IN THE SETTLEMENT ESTATE PROCEEDING?

OF

The residence of the decedent at the time of his death is determinative of the venue of the proceeding. It is only where the decedent was a nonresident of the Philippines at the time of his death that venue lies in any province in which he had estate. 3. WHAT IS THE NATURE OF THE PROCEEDINGS OF SETTLEMENT OF THE ESTATE? The settlement of a decedent’s estate is a proceeding in rem which is binding against the whole world. All persons having interest in the subject matter involved, whether they were notified or not, are equally bound. (Philippine Savings Bank v. Lantin, 124 SCRA 483)

4. QUIAZON V. BELEN, G.R. No. 189121, July 31, 2013.

DOCTRINE: As thus defined, "residence," in the context of venue provisions, means nothing more than a person’s actual residence or place of abode, provided he resides therein with continuity and consistency. RULE 74- [BAR Q. 2001, 2005, 2007, 2009] SUMMARY SETTLEMENT OF ESTATES 1. IF A PERSON HAD NO KNOWLEDGE OR HAD NOT PARTICIPATED IN THE EXTRAJUDICIAL SETTLEMENT, IS HE BOUND THEREBY BY REASON OF CONSTRUCTIVE NOTICE OF PUBLICATION? No. The publication of the settlement does not constitute constructive notice to the heirs who had no knowledge or did not take part in it because the same was notice after the fact of execution.

PRODUCTION OF WILL ALLOWANCE OF WILL NECESSARY 1. IS ALLOWANCE OF A WILL NECESSARY? Yes, the allowance of a will is necessary. Section 1 of Rule 75 is explicit, “No will shall pass either real or personal estate unless it is proved and allowed in the proper court.” 2. IS THE PROBATE OF A WILL MANDATORY? Yes. The probate of a will is mandatory. (Baluyot v. Panio, L-42088, 71 SCRA 86) 3.

DOES A WILL HAVE FORCE AND EFFECT EVEN IF NOT PROBATED?

No. Until admitted to probate, a will has no effect and no right can be claimed thereunder. (Pascual v. Court of Appeals, 409 SCRA 105) 4.

MAY A PROBATE COURT PASS UPON THE INTRINSIC VALIDITY OF A WILL?

No. In a special proceeding for the probate of a will, the issue by and large is restricted to the extrinsic validity of the will, i.e. whether the testator, being of sound mind, freely executed the will in accordance with the formalities prescribed by law. As a rule, the question of ownership is an extraneous matter which the probate court cannot resolve with finality. (Pastor Jr. v. CA, 122 SCRA 185) 5. IS A PROBATE COURT A COURT OF LIMITED JURISDICTION? Yes. A probate court is a court of limited jurisdiction. As such, it may only determine and rule upon issues that relate to settlement of the estate of deceased person such as the administration, liquidation and distribution of the estate. THE ROMAN CATHOLIC BISHOP OF TUGUEGARAO, PETITIONER, VS. FLORENTINA PRUDENCIO, ET. AL. (GR. No. 187942, September 7, 2016, Jardeleza, J.)

DOCTRINE: In all execution of Extrajudicial Settlement of the estate of the deceased, all heirs of the deceased should have participated. No extrajudicial settlement shall be binding upon any person who has not

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participated or had no notice thereof. As the partition was a total nullity and did not affect the excluded heirs, it was not correct for the trial court to hold that their right to challenge the partition had prescribed after two years from its execution. It is clear that Section 1 of Rule 74 does not apply to the partition in question which was null and void as far as the plaintiffs were concerned. The rule covers only valid partitions. In this case, the partition was invalid because it excluded six of the nine heirs who were entitled to equal shares in the partitioned property. Under the rule "no extrajudicial settlement shall be binding upon any person who has not participated therein or had no notice thereof." As the partition was a total nullity and did not affect the excluded heirs, it was not correct for the trial court to hold that their right to challenge the partition had prescribed after two years from its execution.

*IS THE ORDINARY ACTION FOR PARTITION INTENDED TO TAKE THE SPECIAL PROCEEDING ON THE SETTLEMENT OF ESTATE? Yes, the ordinary action for partition therefore is meant to take the place of the special proceeding on the settlement of the estate. The reason is that, if the deceased dies without pending obligations, there is no necessity for the appointment of an administrator to administer the estate for the heirs and the creditors, much less, the necessity to deprive the real owners of their possession to which they are immediately entitled. (Heirs of Ernesto Morales vs. Astrid Morales Agustin, represented by her Attorney-In-Fact, Edgardo Torres, G.R. No. 224849, June 06, 2018, Reyes, Jr., J.)

AMELIA QUIAZON V. MA. LOURDES BELEN (G.R. No. 189121, July 31, 2013) DOCTRINE: An “interested party”, in estate proceedings, is one who would be benefited in the estate, such as an heir, or one who has a claim against the estate, such as a creditor. Also, in estate proceedings, the phrase “next of kin” refers to those whose relationship with the decedent is such that they are entitled to share in the estate as distributes.

RULE 86- [BAR Q. 2002, 2009, 2012] CLAIMS AGAINST ESTATE (BAR QUESTIONS: 1991, 2002, 2009, 2012, 2016)

1.

WHAT IS THE SO-CALLED “STATUTE OF NONCLAIMS” PROVIDED UNDER SECTION 2 OF RULE 86? (*MEMO)

It is the period fixed by for the filing of the claims against the estate. The rule mandates certain creditors of a deceased person to present their claims for examination and allowance within a specified period, the purpose thereof being to settle the estate with dispatch, so that the residue may be delivered to the persons entitled thereto without their being afterwards called upon to respond in actions for claims, which, under the ordinary statute of limitations, have not yet prescribed. (Santos v. Manarang, 27 Phil. 213) 2. AS PROVIDED UNDER SECTION 2 OF RULE 86, WHAT IS THE PERIOD WITHIN WHICH TO FILE THE CLAIM UNDER THE STATUTE OF NONCLAIMS? (*MEMO)

RULE 76-[BAR Q.2011, 2012] ALLOWANCE OR DISALLOWANCE OF WILL 1

The range of the period specified in Section 2 is intended to give the court the discretion to fix the period for the filing of claims.

WHO MAY PETITION?

a. Any executor, devisee, or legatee named in a will, or b. Any other person interested in the estate, 2. WHO IS A “PERSON INTERESTED IN THE ESTATE”?

The probate court is permitted by the rule to set the period as long as it is within the limitation provided. It should not be less than six months nor more than 12 months from the day of the first publication of the notice thereof. Such period when fixed by the probate court becomes mandatory.

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3.

ENUMERATE THE TYPES OF CLAIM THAT MUST BE FILED WITH THE PROBATE COURT UNDER THE NOTICE. (*MEMO) 1) All money claims against the decedent arising from contract, express or implied, whether the same be due, not due, or contingent; 2) All claims for funeral expenses and expenses for the last sickness of the decedent; and 3) Judgment for money against the decedent. The judgment must be presented as a claim against the estate, where the judgment debtor dies before levy on execution of his properties.

4. IS PERSONAL NOTICE UNDER SEC. 4, RULE 76 OF THE RULES OF COURT (NOTICE OF TIME AND PLACE OF PROBATE PROCEEDINGS) A JURISDICTIONAL REQUIREMENT IN TESTATE OR INTESTATE SETTLEMENT OF A DECEASED’S ESTATE? No, personal notice to the heirs is not a jurisdictional requirement in the settlement of estate of deceased persons. A testate or intestate settlement of a deceased's estate is a proceeding in rem, such that the publication under Section 3 of the same Rule vests the court with jurisdiction over all persons who are interested therein. By such publication which constitutes notice to the whole world, petitioners are deemed notified about the intestate proceedings of their father’s estate even if they did not receive any personal notice thereon. (Iona Leriou, Eleptherios L. Longa, et. al. vs. Yohanna Frenesi S. Longa, et. al. Respondents, G.R. No. 203923, October 8, 2018). 5. WHAT IS THE MEANING OF “MONEY CLAIMS” THAT MUST BE FILED IN THE TESTATE OR INTESTATE PROCEEDINGS? Money claims are claims for money, debt or interest thereon upon a liability contracted by the decedent before his death. Claims contracted after his death cannot, therefore, be presented with the exception of funeral expenses and expenses incurred on the last sickness of the decedent.

If the said claims are not filed within the time limit in the notice, they are barred forever from presenting them. IS THERE AN EXCEPTION? Yes, as expressly provided under Section 5 of Rule 86, these claims may be set forth as counterclaims in any action that the executor or administrator may bring against the claimants. 7. IN CASE OF CLAIMS WHICH ARE NOT YET DUE, SHOULD THEY LIKEWISE BE FILED WITHIN THE TIME LIMIT? Yes, not only claims due, but also claims not due or contingent should be filed, otherwise, they too are barred forever. 8. WHAT IS A CONTINGENT CLAIM? It is one by which, by its nature is necessarily dependent upon an uncertain event for its existence and claim, and its validity and enforceability depending upon an uncertain event. (Gasket and Co. v. Tan Sit, 43 Phil. 810) 9. IS DEFICIENCY JUDGMENT A CONTINGENT CLAIM? Yes, deficiency judgment is a contingent claim and, therefore, must be filed with the probate court where the settlement of the estate of the deceased is pending, within the period fixed for the filing of claims. 10. BAR Q. Rule 86 -Claim against the estate; Remedy Chika sued Gringo, a Venezuelan, for a sum of money. The Metropolitan Trial Court of Manila (MeTC) rendered a decision ordering Gringo to pay Chika P50,000.00 plus legal interest. During its pendency of the appeal before the RTC, Gringo died of acute hemorrhagic pancreatitis. Atty. Perfecto, counsel of Gringo, filed a manifestation attaching the death certificate of Gringo and informing the RTC that he cannot substitute the heirs since Gringo did not disclose any information on his family. As counsel for Chika, what remedy can you recommend to your client so the case can move forward and she can eventually recover her money? Explain. SUGGESTED ANSWER:

Section 5, Rule 86 of the Rules of Court expressly allows the prosecution of money claims arising from a contract against the estate of a deceased debtor. (Stronghold Insurance Company, Inc. v. Republic-Asahi Glass Corporation, G.R. No. 147561, June 22, 2006)

The remedy I can recommend to my client Chika is to file a petition for settlement of the estate of Gringo and for the appointment of an administrator. Chika as a creditor is an interested person who can file the petition for settlement of Gringo’s estate.

6. WHAT IS THE CONSEQUENCE IF THE CLAIMS ARE NOT FILED WITHIN THE TIME LIMIT IN THE NOTICE?

Once the administrator is appointed, I will move that the administrator be substituted as the defendant.

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I will also file my claim against Gringo as a contingent claim in the probate proceedings pursuant to Rule 86 of the Rules of Court. 11. BAR Q. Cresencio sued Dioscoro for collection of a sum of money. During the trial, but after the presentation of plaintiff’s evidence, Dioscoro died. Atty. Cruz, Dioscoro’s counsel, then filed a motion to dismiss the action on the ground of his client’s death. The court denied the motion to dismiss and, instead, directed counsel to furnish the court with the names and addresses of Dioscoro’s heirs and ordered that the desig-nated administrator of Dioscoro’s estate be substituted as representative party. After trial, the court rendered judgment in favor of Cresencio. When the decision had become final and executory, Cresencio moved for the issuance of a writ of execution against Dioscoro’s estate to enforce his judgment claim. The court issued the writ of execution. Was the court’s issuance of the writ of execution proper? Explain. SUGGESTED ANSWER: The court’s issuance of the writ of execution was not proper. Under Rule 3 of Section 20, a favorable judgment in a contractual money claim shall be enforced in the manner especially provided in the Rules for prosecuting claims against the estate of a deceased person. Under Rule 86 of the Rules of Court, a judgment for money should be filed as a money claim with the probate court. The Supreme Court has held that a money claim cannot be enforced by a writ of execution but should instead be filed as a money claim. 12. WHAT ARE THE THREE DISTINCT AND ALTERNATIVE REMEDIES AVAILABLE TO A MORTGAGE CREDITOR UPON THE DEATH OF THE MORTGAGOR? (*MEMO)

The alternative remedies provided under this Rules are the following: 1) To waive the security mortgage and claim the entire debt from the estate as an ordinary claim. By filing money claim against the estate he is deemed to have abandoned the mortgage and there-after he cannot file a foreclosure suit if he fails to recover his money claim against the estate; 2) To foreclose the mortgage judicially and prove any deficiency as an ordinary claim. The foreclosure suit should be against the executor or administrator as party defendant. In the event that a creditor fails to fully recover his claim, he may obtain deficiency judgment and file it as

a claim against the estate in the manner provided by this Rule; 3) To rely solely upon the mortgage and foreclose the same at any time before it is barred by prescription without right to claim for any deficiency. This mode includes extrajudicial foreclosure of sale and its exercise precludes one from recovery any balance of indebtedness against the estate and frees the estate from further liability. Thus, a creditor who elects to foreclose by extrajudicial sale waives all his rights to recover against the estate of the deceased debtor for any deficiency remaining unpaid after the sale. It can be readily seen that the decision in this case will impose a burden upon the estates of deceased persons who have mortgaged real property for the security of debts, without any compensatory advantage. (PNB v. Hon. CA, Chua, G.R. No. 121597, June 29, 2001) 14. AS A GENERAL RULE, A PROBATE COURT HAS NO JURISDICTION TO ENTERTAIN A CLAIM IN FAVOR OF THE ESTATE AGAINST A THIRD PERSON AS THE SAME MUST BE THE SUBJECT OF AN ORDINARY ACTION. CITE THE EXCEPTION TO THIS RULE. The exception to this Rule is provided under Section 10 of Rule 86. It authorizes the executor or administrator to interpose any counterclaim in offset of a claim against the estate. Said counterclaim is regarded as a compulsory counterclaim as the failure to file the same shall bar the claim forever.

RULE 88 PAYMENT OF THE DEBTS OF THE ESTATE

1.

DOES THE PROBATE COURT HAVE THE POWER TO ISSUE A WRIT OF EXECUTION TO PAY CLAIMS?

As a general rule, a probate court cannot issue a writ of execution. As held by the Supreme Court in Aldamiz v. Judge of CFI of Mindoro, 85 Phil. 228, 233, a writ of execution is not the proper procedure allowed by the Rules of Court for the payment of debts and expenses of administration. The proper procedure is for the court to order the sale of personal estate or the sale or mortgage of real property of the deceased and all debts and expenses of the administration should be paid out of the proceeds of such sale or mortgage. The order for the sale or mortgage should be issued upon motion of the administrator and with the written notice to all the heirs, legatees and devisees residing in the Philippines, according to Section

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3 of this Rule, and Section 2 of Rule 89. And when sale or mortgage is to be made, the regulations contained in Section 7 of Rule 89 should be complied with.

RULE 90- [BAR Q. 2002, 2011] DISTRIBUTION AND PARTITION OF THE ESTATE

2. ARE THERE EXCEPTIONS? Yes, under the following circumstances, the probate court may issue writs of execution: 1.

To satisfy the distributive shares of devisees, legatees and heirs in possession of the decedent’s assets;

2.

To enforce payment of the expenses of partition; and

3.

To satisfy the costs when a person is cited for examination in probate proceedings.

RULE 89 SALES, MORTGAGES, AND OTHER ENCUMBRANCES OF PROPERTY OF DECEDENT

1. ARE THE NOTICES UNDER SECTIONS 2, 4 AND 7 OF RULE 89 A MANDATORY REQUIREMENT TO EFFECT THE AUTHORITY OF THE SALE OR ENCUMBRANCE OF REAL PROPERTY? Yes, failure to give notice to the heirs, devisees or legatees would invalidate the authority granted by the court. Without compliance with Sections 2, 4, and 7 of Rule 89 of the Rules of Court, “the authority to sell, the sale itself and the order approving it would be null and void ab initio.” 2.CITE SECTIONS 2, 4 AND 7 OF RULE 89 WHERE NOTICES TO THE HEIRS, DEVISEES OR LEGATEES ARE DEEMED MANDATORY. The requirements of written notices under Rule 8...