Lopez vs Lopez G.R. No. 1899984, November 12, 2012 [Case Digest]

 

Lopez vs Lopez

G.R. No. 1899984, November 12, 2012

 

Facts:

            On June 21, 1999, Enrique S. Lopez (Enrique) died leaving his wife, Wendy B. Lopez, and their four legitimate children, namely, petitioner Richard B. Lopez (Richard) and the respondents Diana Jeanne Lopez (Diana), Marybeth de Leon (Marybeth) and Victoria L. Tuazon (Victoria) as compulsory heirs. Before Enrique’s death, he executed a Last Will and Testament constituted Richard as his executor and administrator.

            Richard filed a petition for the probate of his father's Last Will and Testament before the RTC of Manila with prayer for the issuance of letters testamentary in his favor. Marybeth opposed the petition contending that the purported last will and testament was not executed and attested as required by law, and that it was procured by undue and improper pressure and influence on the part of Richard. The said opposition was also adopted by Victoria.

            RTC disallowed the probate of the will for failure to comply with Article 805 of the Civil Code which requires a statement in the attestation clause of the number of pages used upon which the will is written. It held that while Article 809 of the same Code requires mere substantial compliance of the form laid down in Article 805 thereof, the rule only applies if the number of pages is reflected somewhere else in the will with no evidence aliunde or extrinsic evidence required. While the acknowledgment portion stated that the will consists of 7 pages including the page on which the ratification and acknowledgment are written, the RTC observed that it has 8 pages including the acknowledgment portion. As such, it disallowed the will for not having been executed and attested in accordance with law.  CA affirmed the decision of RTC.

 

Issue:

            Whether or not the will was in compliance with Art. 805 in relation with Art. 809 of Civil Code; when although it does not mentioned the number of pages used in the will in the attestation clause but on the acknowledgement of the will there was a statement that the will was composed of 7 pages yet the total number of pages of the will was 8.

 

Held:

            NO; the law is clear that the attestation must state the number of pages used upon which the will is written. The purpose of the law is to safeguard against possible interpolation or omission of one or some of its pages and prevent any increase or decrease in the pages.

            While Article 809 allows substantial compliance for defects in the form of the attestation clause, Richard likewise failed in this respect. The statement in the Acknowledgment portion of the subject last will and testament that it "consists of 7 pages including the page on which the ratification and acknowledgment are written" cannot be deemed substantial compliance. The will actually consists of 8 pages including its acknowledgment which discrepancy cannot be explained by mere examination of the will itself but through the presentation of evidence aliunde. On this score is the comment of Justice J.B.L. Reyes regarding the application of Article 809, to wit: The rule must be limited to disregarding those defects that can be supplied by an examination of the will itself: whether all the pages are consecutively numbered; whether the signatures appear in each and every page; whether the subscribing witnesses are three or the will was notarized. All these are facts that the will itself can reveal, and defects or even omissions concerning them in the attestation clause can be safely disregarded. But the total number of pages, and whether all persons required to sign did so in the presence of each other must substantially appear in the attestation clause, being the only check against perjury in the probate proceedings.

Jaboneta vs. Gustilo, GR No. 1641, January 19, 1906 [Case Digest]

 

Jaboneta vs. Gustilo,

GR No. 1641, January 19, 1906

 

Facts:

            Macario Jaboneta ordered that the document in question be written, and calling Julio Javellana, Aniceto Jalbuena, and Isabelo Jena as witnesses, executed the said document as his will. They were all together, and were in the room where Jaboneta was, and were present when he signed the document, Isabelo Jena signing afterwards as a witness, at his request, and in his presence and in the presence of the other two witnesses. Aniceto Jalbuena then signed as a witness in the presence of the testator, and in the presence of the other two persons who signed as witnesses. At that moment Isabelo Jena, being in a hurry to leave, took his hat and left the room. As he was leaving the house Julio Javellana took the pen in his hand and put himself in position to sign the will as a witness, but did not sign in the presence of Isabelo Jena; but nevertheless, after Jena had left the room the said Julio Javellana signed as a witness in the presence of the testator and of the witness Aniceto Jalbuena.

            The probate court denied the last will and testament of Macario Jaboneta, deceased, because the lower court was of the opinion from the evidence adduced at the hearing that Julio Javellana, one of the witnesses, did not attach his signature thereto in the presence of Isabelo Jena, another of the witnesses, as required by the law.

 

Issue:

            Whether or not signature of Javellana is in compliance with the law even the other witness also saw the latter in the act of signing not the actual signing as instrumental witness of the will.

 

Held:

            YES. SC cannot agree with so much of the above finding of facts as holds that the signature of Javellana was not signed in the presence of Jena, in compliance with the provisions of the law. The fact that Jena was still in the room when he saw Javellana moving his hand and pen in the act of affixing his signature to the will, taken together with the testimony of the remaining witnesses which shows that Javellana did in fact there and then sign his name to the will, convinces us that the signature was affixed in the presence of Jena. The fact that he was in the act of leaving, and that his back was turned while a portion of the name of the witness was being written, is of no importance. He, with the other witnesses and the testator, had assembled for the purpose of executing the testament, and were together in the same room for that purpose, and at the moment when the witness Javellana signed the document he was actually and physically present and in such position with relation to Javellana that he could see everything which took place by merely casting his eyes in the proper direction, and without any physical obstruction to prevent his doing so, therefore we are of opinion that the document was in fact signed before he finally left the room.

 

           

Lopez vs. Liboro, G.R. No. L-1787, August 27, 1948 [Case Digest]

 

Lopez vs. Liboro,

G.R. No. L-1787, August 27, 1948

 

Facts:

            Agustin Liboro opposed the probate of what purports to be the last will and testament of Don Sixto Lopez.  Liboro questioned the validity of the will because of the following:

§  The first sheet is not paged either in letters or in Arabic numerals.

§  There are contradictions in the testimony of the instrumental witnesses

§  The testator affixed his thumb mark to the instrument instead of signing his name.

§  That the will is silence on the testator's understanding of the language used in the testament.

CFI held that the will was executed in all particulars as required by law.

 

Issue:

            Whether or not the will is defective as point out by Liboro.

 

Held:

            NO; as to the issue that first sheet of the will is not paged either in letters or in Arabic numerals; the purpose of the law in prescribing the paging of wills is guard against fraud, and to afford means of preventing the substitution or of defecting the loss of any of its pages. (Abangan vs. Abangan, 40 Phil., 476.) In the present case, the omission to put a page number on the first sheet, if that be necessary, is supplied by other forms of identification more trustworthy than the conventional numerical words or characters. The unnumbered page is clearly identified as the first page by the internal sense of its contents considered in relation to the contents of the second page. By their meaning and coherence, the first and second lines on the second page are undeniably a continuation of the last sentence of the testament, before the attestation clause, which starts at the bottom of the preceding page. Furthermore, the unnumbered page contains the caption "TESTAMENTO," the invocation of the Almighty, and a recital that the testator was in full use of his testamentary faculty, — all of which, in the logical order of sequence, precede the direction for the disposition of the marker's property. Again, as page two contains only the two lines above mentioned, the attestation clause, the mark of the testator and the signatures of the witnesses, the other sheet cannot by any possibility be taken for other than page one.

 

            As to the issue that there are contradictions in the testimony of the instrumental witnesses; SC held that the contradictions in the testimony of the instrumental witnesses as are set out in the appellant's brief are incidents not all of which every one of the witnesses can be supposed to have perceived, or to recall in the same order in which they occurred.

 

            With regards to the issue that the testator affixed his thumb mark to the instrument instead of signing his name; the reason for this was that the testator was suffering from "partial paralysis." While another in testator's place might have directed someone else to sign for him, as appellant contends should have been done, there is nothing curious or suspicious in the fact that the testator chose the use of mark as the means of authenticating his will. It was a matter of taste or preference. Both ways are good. A statute requiring a will to be "signed" is satisfied if the signature is made by the testator's mark. (De Gala vs. Gonzales and Ona, 53 Phil., 108; 28 R. C. L., 117.)

 

            As to the issue that the will is silence on the testator's understanding of the language used in the testament; SC held that there is no statutory requirement that such knowledge be expressly stated in the will itself. It is a matter that may be established by proof aliunde.

Taboada v. Hon Rosal, GR. No. L-36033, Nov. 5, 1982 [Case Digest]

 

Taboada v. Hon Rosal,

GR. No. L-36033, Nov. 5, 1982

 

Facts:

            In the petition for probate filed with the respondent court, the petitioner attached the alleged last will and testament of the late Dorotea Perez. Written in the Cebuano-Visayan dialect, the will consists of two pages. The first page contains the entire testamentary dispositions and is signed at the end or bottom of the page by the testatrix alone and at the left hand margin by the three (3) instrumental witnesses. The second page which contains the attestation clause and the acknowledgment is signed at the end of the attestation clause by the three (3) attesting witnesses and at the left hand margin by the testatrix. The attestation clause failed to state the number of pages used in writing the will; but in the acknowledgement of the said will itself states that "This Last Will and Testament consists of two pages including this page".

            The CFI denied the probate of the will for want of a formality in its execution. The respondent Judge interprets the Art. 805 NCC to require that, for a notarial will to be valid, it is not enough that only the testatrix signs at the "end" but an the three subscribing witnesses must also sign at the same place or at the end, in the presence of the testatrix and of one another because the attesting witnesses to a will attest not merely the will itself but also the signature of the testator. It is not sufficient compliance to sign the page, where the end of the will is found, at the left hand margin of that page.

 

Issue:

            Whether or not will in questioned lack of formality in its execution.

 

Held:

            NO. While perfection in the drafting of a will may be desirable, unsubstantial departure from the usual forms should be ignored, especially where the authenticity of the will is not assailed. (Gonzales v. Gonzales, 90 Phil. 444).

 

The objects of attestation and of subscription were fully met and satisfied in the present case when the instrumental witnesses signed at the left margin of the sole page which contains all the testamentary dispositions, especially so when the will was properly Identified by subscribing witness Vicente Timkang to be the same will executed by the testatrix. There was no question of fraud or substitution behind the questioned order.

SC have examined the will in question and noticed that the attestation clause failed to state the number of pages used in writing the will. This would have been a fatal defect were it not for the fact that, in this case, it is discernible from the entire wig that it is really and actually composed of only two pages duly signed by the testatrix and her instrumental witnesses. As earlier stated, the first page which contains the entirety of the testamentary dispositions is signed by the testatrix at the end or at the bottom while the instrumental witnesses signed at the left margin. The other page which is marked as "Pagina dos" comprises the attestation clause and the acknowledgment. The acknowledgment itself states that "This Last Will and Testament consists of two pages including this page".

            The law is to be liberally construed, "the underlying and fundamental objective permeating the provisions on the law on wills in this project consists in the liberalization of the manner of their execution with the end in view of giving the testator more freedom in expressing his last wishes but with sufficient safeguards and restrictions to prevent the commission of fraud and the exercise of undue and improper pressure and influence upon the testator. This objective is in accord with the modern tendency in respect to the formalities in the execution of a will"

 

           

 

 

Azuela vs. CA, G.R. No. 122880; April 12, 2006 [Case Digest]

 

Azuela vs. CA,

G.R. No. 122880; April 12, 2006

Facts:

            The case stems from a petition for probate filed on 10 April 1984 with the Regional Trial Court (RTC) of Manila. The petition filed by petitioner Felix Azuela sought to admit to probate the notarial will of Eugenia E. Igsolo, which was notarized on 10 June 1981. Petitioner is the son of the cousin of the decedent.

            The will, consisting of two (2) pages and written in the vernacular Pilipino. The three named witnesses to the will affixed their signatures on the left-hand margin of both pages of the will, but not at the bottom of the attestation clause.

            The petition was opposed by Geralda Aida Castillo (Geralda Castillo), who represented herself as the attorney-in-fact of "the 12 legitimate heirs" of the decedent. Geralda Castillo claimed that the will is a forgery, and that the true purpose of its emergence was so it could be utilized as a defense in several court cases filed by oppositor against petitioner, particularly for forcible entry and usurpation of real property, all centering on petitioner’s right to occupy the properties of the decedent. It also asserted that contrary to the representations of petitioner, the decedent was actually survived by 12 legitimate heirs, namely her grandchildren, who were then residing abroad.

            Oppositor Geralda Castillo also argued that the will was not executed and attested to in accordance with law. She pointed out that decedent’s signature did not appear on the second page of the will, and the will was not properly acknowledged. These twin arguments are among the central matters to this petition.

            RTC admitted the will to probate. RTC held that "on the oppositor’s contention that the attestation clause was not signed by the subscribing witnesses at the bottom thereof, this Court is of the view that the signing by the subscribing witnesses on the left margin of the second page of the will containing the attestation clause and acknowledgment, instead of at the bottom thereof, substantially satisfies the purpose of identification and attestation of the will." Court of Appeals reversed the trial court and ordered the dismissal of the petition for probate. The Court of Appeals noted that the attestation clause failed to state the number of pages used in the will, thus rendering the will void and undeserving of probate.

            Petitioner argues that the requirement under Article 805 of the Civil Code that "the number of pages used in a notarial will be stated in the attestation clause" is merely directory, rather than mandatory, and thus susceptible to what he termed as "the substantial compliance rule."

 

Issue:

            Whether the will should be admitted.

 

Held:

            No; the appellate court, in its Decision, considered only one defect, the failure of the attestation clause to state the number of pages of the will. But an examination of the will itself reveals several more deficiencies.

            As admitted by petitioner himself, the attestation clause fails to state the number of pages of the will. There was an incomplete attempt to comply with this requisite, a space having been allotted for the insertion of the number of pages in the attestation clause. Yet the blank was never filled in; hence, the requisite was left un-complied with.

            In Uy Coque v. Navas L. Sioca, the Court noted that among the defects of the will in question was the failure of the attestation clause to state the number of pages contained in the will. In ruling that the will could not be admitted to probate, the Court made the following consideration which remains highly relevant to this day: "The purpose of requiring the number of sheets to be stated in the attestation clause is obvious; the document might easily be so prepared that the removal of a sheet would completely change the testamentary dispositions of the will and in the absence of a statement of the total number of sheets such removal might be effected by taking out the sheet and changing the numbers at the top of the following sheets or pages. If, on the other hand, the total number of sheets is stated in the attestation clause the falsification of the document will involve the inserting of new pages and the forging of the signatures of the testator and witnesses in the margin, a matter attended with much greater difficulty."

            The case of In re Will of Andrada concerned a will the attestation clause of which failed to state the number of sheets or pages used. This consideration alone was sufficient for the Court to declare "unanimity upon the point that the defect pointed out in the attesting clause is fatal."

            In lieu of an acknowledgment, the notary public, Petronio Y. Bautista, wrote "Nilagdaan ko at ninotario ko ngayong 10 ng Hunyo (sic), 1981 dito sa Lungsod ng Maynila." By no manner of contemplation can those words be construed as an acknowledgment. An acknowledgment is the act of one who has executed a deed in going before some competent officer or court and declaring it to be his act or deed. It involves an extra step undertaken whereby the signor actually declares to the notary that the executor of a document has attested to the notary that the same is his/her own free act and deed.

            It might be possible to construe the averment as a jurat, even though it does not hew to the usual language thereof. A jurat is that part of an affidavit where the notary certifies that before him/her, the document was subscribed and sworn to by the executor. Ordinarily, the language of the jurat should avow that the document was subscribed and sworn before the notary public, while in this case, the notary public averred that he himself "signed and notarized" the document. Possibly though, the word "ninotario" or "notarized" encompasses the signing of and swearing in of the executors of the document, which in this case would involve the decedent and the instrumental witnesses.

            Yet even if we consider what was affixed by the notary public as a jurat, the will would nonetheless remain invalid, as the express requirement of Article 806 is that the will be "acknowledged", and not merely subscribed and sworn to. The will does not present any textual proof, much less one under oath, that the decedent and the instrumental witnesses executed or signed the will as their own free act or deed. The acknowledgment made in a will provides for another all-important legal safeguard against spurious wills or those made beyond the free consent of the testator. An acknowledgement is not an empty meaningless act. The acknowledgment coerces the testator and the instrumental witnesses to declare before an officer of the law that they had executed and subscribed to the will as their own free act or deed. Such declaration is under oath and under pain of perjury, thus allowing for the criminal prosecution of persons who participate in the execution of spurious wills, or those executed without the free consent of the testator. It also provides a further degree of assurance that the testator is of certain mindset in making the testamentary dispositions to those persons he/she had designated in the will.

            It may not have been said before, but we can assert the rule, self-evident as it is under Article 806. A notarial will that is not acknowledged before a notary public by the testator and the witnesses is fatally defective, even if it is subscribed and sworn to before a notary public.

Mitra vs. Sablan-Guevarra, G.R. No. 213994, April 18, 2018 [Case Digest]

 

Mitra vs. Sablan-Guevarra,

G.R. No. 213994, April 18, 2018

Second Division [REYES, JR., J.:]

Facts:

            On June 26, 2006, Margie Santos Mitra (petitioner) filed a petition for the probate of the notarial will of Remedios Legaspi with prayer for issuance of letters testamentary before the RTC. It was alleged that the petitioner is the de facto adopted daughter of Legaspi; that Legaspi, single, died on December 22, 2004 in Caloocan City; that Legaspi left a notarial will, instituting the petitioner, Orlando Castro, Perpetua Sablan Guevarra, and Remigio Legaspi Sablan, as her heirs, legatees and devisees; that Legaspi left real and personal properties with the approximate total value of P1,032,237.00 and that Legaspi named Mary Ann Castro as the executor of the will.

            Perpetua L. Sablan-Guevarra and Remegio L. Sablan (respondents), who claim to be Legaspi's legal heirs, opposed the petition. They aver that the will was not executed in accordance with the formalities required by law; that since the last page of the will, which contained the Acknowledgement, was not signed by Legaspi and her instrumental witnesses, the will should be declared invalid; that the attestation clause failed to state the number of pages upon which the will was written; and that the will was executed under undue and improper pressure, thus, Legaspi could not have intended the document to be her last will and testament.

            RTC admit the will of Legaspi. The probate court explained that the last page of the will is but a mere continuation of the Acknowledgement portion, which the testator and the witnesses are not required to sign. Also, it held that inasmuch as the number of pages upon which the will was written was stated in the Acknowledgement, the will must be admitted to probate. The respondents' allegation of undue influence or improper pressure exerted upon Legaspi was disregarded for failure on their part to adduce evidence proving the existence thereof.

            CA reversed the judgment of the RTC, as the CA adhered to the view of strictly complying with the requirement of stating the number of pages of the will in the attestation clause. Moreover, the CA detected another supposed fatal defect in the will: the photocopy of the will submitted by the respondents on appeal did not contain the signatures of the instrumental witnesses on each and every page thereof.

            The petitioner, in assailing the findings of the CA, argues that in the original copy of the will that was offered before the probate court as Exhibit "L," it is clear that the instrumental witnesses signed on the left margin of every page of the will except the last, as did Legaspi.  The petitioner advances that the confusion arose when the respondents, in their record of appeal, submitted an altered photocopy of the will to the CA, in which the signatures of the instrumental witnesses were covered when photocopied, to make it appear that the witnesses did not sign on every page. This misled the CA to rule that the will was defective for the lack of signatures.

 

Issue 1:

            Whether the CA erred in finding that the instrumental witnesses to the will failed to sign on each and every page thereof on the left margin, except the last, as required under Article 805 of the Civil Code.

 

Held:

            Yes; it is uncontested and can be readily gleaned that the instrumental witnesses signed on each and every page of the will, except the last page. Such being the case, the CA erred in concluding otherwise. There is no doubt that the requirement under the Article 805 of the Civil Code, which calls for the signature of the testator and of the instrumental witnesses on each and every page of the will on the left margin, except the last, was complied with.

            It should also be mentioned that the respondents take a skewed stance in insisting that the testator Legaspi and the instrumental witnesses should have signed on the last page of the subject will. When Article 805 of the Civil Code requires the testator to subscribe at the end of the will, it necessarily refers to the logical end thereof, which is where the last testamentary disposition ends. As the probate court correctly appreciated, the last page of the will does not contain any testamentary disposition; it is but a mere continuation of the Acknowledgment.

 

Issue 2:

            Whether the CA erred in ruling that the failure to state the number of pages comprising the will on the attestation clause renders such will defective.

 

Held:

            Yes; in Singson vs. Florentino, the Court adopted a more liberal approach and allowed probate, even if the number of pages of the will was mentioned in the last part of the body of the will and not in the attestation clause. This is to prevent the will of the testator from being defeated by purely technical considerations.

            The substantial compliance rule is embodied in the Civil Code as Article 809 thereof, which provides that: Article 809. 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 Article 805.

            Thus, in Taboada vs. Hon. Rosal, the Court allowed the probate of a will notwithstanding that the number of pages was stated not in the attestation clause, but in the Acknowledgment. In Azuela vs. CA, the Court ruled that there is substantial compliance with the requirement, if it is stated elsewhere in the will how many pages it is comprised of.

            What is imperative for the allowance of a will despite the existence of omissions is that such omissions must be supplied by an examination of the will itself, without the need of resorting to extrinsic evidence. "However, those omissions which cannot be supplied except by evidence aliunde would result in the invalidation of the attestation clause and ultimately, of the will itself."

            An examination of the will in question reveals that the attestation clause indeed failed to state the number of pages comprising the will. However, as was the situation in Taboada, this omission was supplied in the Acknowledgment. It was specified therein that the will is composed of four pages, the Acknowledgment included. As with the will, the Acknowledgment is written in Filipino, quoted in part below: Ang HULING HABILlNG ito ay binubuo ng apat (4) na dahon, kasama ang dahong kinaroroonan ng Pagpapatunay at Pagpapatotoong ito.

            In sum, Legaspi's last will and testament has substantially complied with all the formalities required of a notarial will. It has been proven that Legaspi and the instrumental witnesses signed on every page of the will, except on the last, which refers to the Acknowledgment page. With regard to the omission of the number of pages in the attestation clause, this was supplied by the Acknowledgment portion of the will itself without the need to resort to extrinsic evidence. Contrary to the CA conclusion, such omission does not in any way serve as hindrance to probate.

Genato vs Bayhon G.R. No. 171035 [Case Digest]

 

Genato vs Bayhon

G.R. No. 171035

 

Facts:

            Respondents (Bayhon et al) filed an action before RTC QC for the declaration of nullity of a dacion en pago allegedly executed by respondent Benjamin Bayhon in favor of petitioner William Genato.  Benjamin Bayhon alleged that he obtained from the petitioner a loan amounting to PhP 1,000,000.00; that to cover the loan, he executed a Deed of Real Estate Mortgage over the property.        Respondent further alleged that he filed a separate proceeding for the reconstitution of TCT No. 38052 before the RTC, QC.  Petitioner Genato filed an Answer in Intervention in the said proceeding and attached a copy of an alleged dacion en pago covering said lot. Respondent assailed the dacion en pago as a forgery alleging that neither he nor his wife, who had died 3 years earlier, had executed it.

            In his Answer, petitioner denied the claim of the respondent regarding the death of the latter’s wife. He alleged that on the date that the real estate mortgage was to be signed, respondent introduced to him a woman as his wife. He alleged that the respondent signed the dacion en pago and that the execution of the instrument was above-board.

            With respect to the dacion en pago, the trial court held that the parties have novated the agreement. It deduced the novation from the subsequent payments made by the respondent to the petitioner. Of the principal amount, the sum of PhP 102,870.00 had been paid: PhP 27,870.00 on March 23, 1990, PhP 55,000.00 on 26 March 1990 and PhP 20,000.00 on 16 November 1990. All payments were made after the purported execution of the dacion en pago.

            The trial court likewise found that at the time of the execution of the real estate mortgage, the wife of respondent, Amparo Mercado, was already dead. It held that the property covered by TCT No. 38052 was owned in common by the respondents and not by respondent Benjamin Bayhon alone. It concluded that the said lot could not have been validly mortgaged by the respondent alone; the deed of mortgage was not enforceable and only served as evidence of the obligation of the respondent. Trial court upheld the respondent’s liability to the petitioner and ordered the latter to pay the sum of Php 5,647,130.00.

            CA reversed the decision of the trial court and held that the real estate mortgage and the dacion en pago were both void. The appellate court ruled that at the time the real estate mortgage and the dacion en pago were executed, or on July 3, 1989 and October 21, 1989, respectively, the wife of respondent Benjamin Bayhon was already dead. Thus, she could not have participated in the execution of the two documents. The appellate court struck down both the dacion en pago and the real estate mortgage as being simulated or fictitious contracts pursuant to Article 1409 of the Civil Code.

            CA held further that while the principal obligation is valid, the death of respondent Benjamin Bayhon extinguished it.  The heirs could not be ordered to pay the debts left by the deceased.

 

Issue:

            Whether or not Benjamin Bayhon is liable to Mr. Genato in the amount of Php 5,647,130.00 in principal and interest as of October 3, 1997 and 5% monthly interest thereafter until the account shall have been fully paid.

 

Held:

            Yes with modification as to the obligation to pay the principal loan and interest contracted by the deceased Benjamin Bayhon subsists against his estate and is computed at PhP 3,050,682.00.

As a general rule, obligations derived from a contract are transmissible. Article 1311, par.1 of the Civil Code provides: Contracts take effect only between the parties, their assigns and heirs, except in case where the rights and obligations arising from the contract are not transmissible by their nature, or by stipulation or by provision of law. The heir is not liable beyond the value of the property he received from the decedent.

 

In Estate of Hemady v. Luzon Surety Co., Inc., the Court, through Justice JBL Reyes, held: While in our successional system the responsibility of the heirs for the debts of their decedent cannot exceed the value of the inheritance they receive from him, the principle remains intact that these heirs succeed not only to the rights of the deceased but also to his obligations. Articles 774 and 776 of the New Civil Code (and Articles 659 and 661 of the preceding one) expressly so provide, thereby confirming Article 1311.

            Under our law, therefore, the general rule is that a party's contractual rights and obligations are transmissible to the successors.

            The loan in this case was contracted by respondent. He died while the case was pending before the Court of Appeals. While he may no longer be compelled to pay the loan, the debt subsists against his estate. No property or portion of the inheritance may be transmitted to his heirs unless the debt has first been satisfied. Notably, throughout the appellate stage of this case, the estate has been amply represented by the heirs of the deceased, who are also his co-parties in Civil Case No. Q-90-7012.

            The procedure in vindicating monetary claims involving a defendant who dies before final judgment is governed by Rule 3, Section 20 of the Rules of Civil Procedure, to wit:  When the action is for recovery of money arising from contract, express or implied, and the defendant dies before entry of final judgment in the court in which the action was pending at the time of such death, it shall not be dismissed but shall instead be allowed to continue until entry of final judgment. A favorable judgment obtained by the plaintiff therein shall be enforced in the manner especially provided in these Rules for prosecuting claims against the estate of a deceased person.