Lopez v. Mikol Properties, Inc.

FIRST DIVISION

[G.R. No. 242057. October 6, 2021.]

CARLOS HERNANDEZ LOPEZ, petitioner, vs.MIKOL PROPERTIES, INC. AND MA. TERESA DE PAULA-YAP, respondents.

NOTICE

Sirs/Mesdames :

Please take notice that the Court, First Division, issued a Resolution datedOctober 6, 2021which reads as follows: HTcADC

"G.R. No. 242057 (Carlos Hernandez Lopez, petitioner v. Mikol Properties, Inc. and Ma. Teresa de Paula-Yap, respondents).

This is a Petition for Review on Certiorari1 under Rule 45 of the Rules of Court assailing the January 30, 2018 Decision 2 and September 11, 2018 Resolution 3 of the Court of Appeals (CA), in CA-G.R. SP No. 151095. The CA affirmed the Orders dated February 4, 2016 4 and March 29, 2017, 5 issued by the Regional Trial Court of Makati City, Branch 56 (RTC), in Special Proceeding Case No. M-7304, 6 approving the motion for approval of deed of sale of one of the properties included in the estate of the late Olivia Lopez Vda. De Padilla.

Antecedents

Olivia Lopez Vda. De Padilla (Olivia) died on January 19, 2011, 7 almost a year after her husband, Miguel A. Padilla (Miguel), passed away on January 28, 2010. 8 Olivia and Miguel died intestate and without any children.

On February 11, 2011, herein respondent Ma. Teresa de Paula-Yap (Yap) together with Abelardo Lopez, Jr., Olivia's niece and nephew, respectively, filed a petition for letters of administration with the RTC of Iloilo City. The petition was dismissed due to improper venue. 9

On May 3, 2012, respondent Mikol Properties, Inc. (Mikol Properties) filed with the Makati RTC a Petition for Settlement of Estate of the Late Olivia Lopez Vda. De Padilla with prayer for the issuance of letters of administration to Yap. The petition was initially raffled to RTC Branch 142, but after the presiding judge inhibited from participating in the case, the same was raffled to Branch 56 under Judge Bonifacio S. Pascua. 10

Several individuals claiming to be heirs of Olivia's siblings, filed their respective comments and oppositions to the petition, namely:

1. Adriano H. Lopez and Jovita Carla H. Lopez, heirs of the late Eusebio Lopez;

2. Peter Paul K. Lopez, heir of the late Carlos Lopez;

3. Carlos H. Lopez (herein petitioner Lopez), heir of the late Eusebio Lopez; and

4. Roger Neil L. Lopez and Maria Betty L. Lopez, heirs of the late Alfredo Lopez.

A certain Arlene Aquino Vda. De Padilla, the wife of the late Ramon Padilla, brother of Miguel, also filed a comment and opposition. Another heir of Miguel, Renato Padilla, filed a motion to participate in the proceedings. 11

After considering all the arguments and evidence presented by the parties, and to prevent dissipation of the properties of the estate, 12 the RTC issued an Order 13 on May 18, 2015, appointing Yap as a special administrator. Lopez questioned Yap's appointment to the CA via a petition for certiorari. 14 Finding no grave abuse of discretion in Yap's appointment, the CA dismissed the petition. Lopez eventually elevated the matter to this Court via a petition for review, 15 but the same was denied in a Resolution 16 issued on July 19, 2017.

Sometime in August 2015, Yap submitted a Partial Inventory 17 of the properties belonging to the estate of Olivia. Included in the list were the following real estate properties located in Makati, 18viz.:

 

Title No.	Lot No.	Area	Location	Tax Declaration Value	Description
TCT S-108275	Lot 22 Block 20	1,202	71 Real St., Urdaneta Village, Makati City	P14,925,000.00	Residential Lot
			71 Real St., Urdaneta Village, Makati City	P1,187,000.00	Residential house
TCT S-454686			Cruzada St., Urdaneta Village, Makati City	P1,093,900.00	With abandoned & dilapidated house
TCT S-8747	Lot 6 Block 34	608	Limasawa St., Magallanes Village, Makati [City]	P875,052.00	Residential lot
			Limasawa St., Magallanes Village, Makati City	P132,009.00	Residential Bldg.
TCT 104310	Unit 702	34	Asian Mansion Cond., Dela Rosa St., Makati [City]	P269,860.00	Residential Condo
TCT 407320	Lot 19 Block 11	353	Cardona St., Makati [City]	P543,400.00	Commercial Lot
			Cardona St., Makati [City]	P961,220.00	Residential Bldg.
TCT 162236	Lot 11-A	111	Taguig St., Valenzuela, Makati [City]	P46,620.00	Residential Lot
			Taguig St., Valenzuela, Makati [City]	P900,880.00	Residential Bldg.
TCT 162236	Lot 11-B	95	Taguig St., Valenzuela, Makati [City]	P39,900.00	Residential Lot
			Taguig St., Valenzuela, Makati [City]	P259,310.00	Residential Bldg.
TCT 162238	Lot 11-C	97	Taguig St., Valenzuela, Makati [City]	P40,740.00	Residential Lot
			Taguig St., Valenzuela, Makati [City]	P259,210.00	Residential Bldg.

 

In her Motion for Authority to Sell 19 dated September 21, 2015, Yap claimed that most of the properties belonging to Olivia's estate, including lands and buildings, were not being maintained and had been neglected since January 2011. Consequently, these properties were in danger of being placed on auction sale due to unpaid real estate taxes, which may only be redeemed within a one (1)-year period at 24% interest. Yap also mentioned unpaid subdivision membership dues, uncollected rental payments, the need to file suits to protect the estate and, most importantly, the unpaid estate (inheritance) taxes with accrued interest and penalties since February 2011. To cover these expenses, Yap sought approval from the RTC to sell the following Makati properties: (1) No. 51 Cruzada St. (Cruzada property); (2) No. 71 Real Street, Urdaneta Village (Real property); and (3) No. 6 Limasawa St., Magallanes Village (Limasawa property).

After hearing the opposition and arguments from all parties, the RTC granted the motion through an Order 20 issued on November 5, 2015, the pertinent portions of which read as follows:

It is for [these] rationalizations that this Court is inclined to grant, as it hereby grants the authority to the Special Administratrix to sell, with the approval of the court, the following parcels of land: (1) No. 51 Cruzada St., Urdaneta Village, Makati City; (2) No. 71 Real St., Urdaneta Village, Makati City; and (3) No. 6 Limasawa St., Magallanes Village, Makati City, subject to the conditions as stated in the motion setting the minimum price of [P]100,000,000.00 for the No. 51 Cruzada St., Urdaneta Village, Makati City; [P]120,000,000.00 for the No. 71 Real St., Urdaneta Village, Makati City; and [P]60,000,000.00 for the No. 6 Limasawa St., Magallanes Village, Makati City. The purchaser shall pay the purchase price upon the signing of the Deed of Sale. The Deed of Sale shall in turn be submitted to the Court for approval or disapproval. In the event that the sale is disapproved by the Court, the entire purchase price received by the Special Administratrix shall be refunded to the purchaser within [thirty-six] (36) hours from receipt of the disapproval.

Any of the heirs may buy any of the mentioned properties, or may act as agent, provided they are licensed brokers; all purchasers will be required to show their capacity to comply with the payment to the Special Administratrix after which a Contract to Sell embodying the conditions provided herein shall be signed. This Authority to Sell shall be valid for fifteen (15) days from receipt by the Administration [sic] of the Authority to Sell from the Court. However, if x x x no minimum offer is received then this may be extended, upon motion and upon proper hearing so that all parties may be apprised of the current status of the estate and its corresponding obligations.

Upon approval of the sale, the Special Administratrix shall deposit the amount she received, less the necessary taxes and commissions, and thereafter with 24 working hours shall report and account for the proceeds to the court, furnishing copies to all the legal heirs and oppositors through their respective counsels.

SO ORDERED. 21

Yap was able to find a buyer for the Cruzada property for a selling price of One Hundred Eight Million Three Hundred Fifty Thousand Pesos (P108,350,000.00). Consequently, Yap filed a Motion for Approval of Deed of Sale. 22

On February 4, 2016, the RTC issued an Order 23 approving the motion for approval of deed of sale. It stated:

WHEREFORE, the Deed of Sale dated 25 November 2015 is hereby approved. The Administratrix is ordered to pay or deposit the amount for the estate tax, capital gains tax, commission of the real estate agent, attaching the receipt for the agent's withholding tax and expenses relative to the sale. All other expenses chargeable from the proceeds of the sale should bear the approval of this Court.

SO ORDERED. 24

Lopez and the other heirs filed their respective motions for reconsideration. After due proceedings, the RTC denied the motions through an Order 25 issued on March 29, 2017.

Dissatisfied by the ruling, Lopez filed a petition for certiorari under Rule 65 of the Rules of Court with the CA, imputing grave abuse of discretion on the part of the RTC for approving the deed of sale. He claimed that the sale should not have been allowed because the Cruzada property is a conjugal property, and that Yap miserably failed in her duty as administrator and was keen on dissipating the estate.

The CA's Ruling

On January 30, 2018, the CA dismissed the petition and decreed as follows:

WHEREFORE, the aforegoing considered, the petition for certiorari should be, as it is hereby ordered DISMISSED, and the Order dated 04 February 2016 issued by Hon. Bonifacio S. Pascua, and the Order dated 29 March 2017 issued by Hon. Benjamin T. Pozon, in Special Proceeding Case No. M-7304 hereby STAND.

SO ORDERED. 26

The CA held that the RTC cannot rule on whether the Cruzada property is a conjugal property because it should either be tried in a separate ordinary civil action or with the trial court if and when all the parties thereto are heirs to the estate and no third parties are impaired. The appellate court likewise noted the lack of evidence showing that Yap had been remiss in her duties as administrator. Finally, the CA agreed with the RTC that none of the oppositors posted a bond as required by the rules to prevent the authority of the administratrix to sell the property. As such, the trial court had no other option but to approve the sale.

Lopez filed a motion for reconsideration, but the CA denied the same in its September 11, 2018 Resolution. 27 Hence, this appeal.

ISSUES

Lopez argues that the CA erred in disregarding the grave abuse of discretion committed by the RTC because:

A.

THE RTC ORDERS APPROVING THE SALE OF THE CRUZADA PROPERTY WERE ISSUED PRIOR TO THE COURT A QUO'S INVENTORY OF THE PROPERTIES OF DECEASED OLIVIA'S INTESTATE ESTATE; THUS, THERE WAS, AND STILL IS, NO PROVISIONAL DETERMINATION (THE INCLUSION IN, OR EXCLUSION FROM) OF WHAT CONSTITUTES THE PROPERTIES OF THE INTESTATE ESTATE OF DECEASED OLIVIA;

B.

THE CRUZADA PROPERTY IS A CONJUGAL PROPERTY BETWEEN DECEASED OLIVIA AND THE LATE MIGUEL PADILLA; [AND]

C.

RESPONDENT YAP HAS BEEN (AND STILL IS) IN COMPLETE AND UTTER REMISS IN PERFORMING HER DUTIES AND RESPONSIBILITIES AS THE ADMINISTRATOR OF THE INTESTATE ESTATE OF DECEASED OLIVIA. 28

Lopez maintains that in issuing the February 4, 2016 Order, the RTC arbitrarily granted the motion to sell on the ground that it appears to be fair to all the heirs, and that the oppositors did not post a bond to prevent the administratrix from selling the property. He also notes that the RTC solely based its March 29, 2017 Order on the abandonment of the positions of one of the heirs, former CA Justice Mario Lopez Guariña III, without taking into consideration Lopez's arguments. 29 Moreover, the trial court cannot allow the sale prior to an inventory of the estate, including a provisional determination of whether the Cruzada property is conjugal property. 30 Also, under Section 2, Rule 89 of the Rules of Court, real properties may only be sold if the personal properties are insufficient to cover the expenses. 31

In their Comment, 32 Mikol Properties and Yap counter that the petition should be dismissed outright because the decision of the CA had legal and factual basis. Contrary to the allegations of Lopez, Yap had submitted the inventory of the properties belonging to the estate. They also argue that the Cruzada property was included in the inventory of real properties of Olivia and that Lopez had also included the said realty in his petition for certiorari filed before the Court. They also maintain that the CA correctly held that the RTC, as an intestate court, has no jurisdiction to rule on the ownership of the Cruzada property; and that Lopez had no standing to claim that the subject realty is conjugal, considering that none of the heirs of Miguel had initiated any action to settle his estate. Moreover, the RTC Order issued on November 5, 2015, which approved the sale of the Cruzada, Real, and Limasawa properties had already become final and executory. Lopez had already received his share from the sale and is therefore estopped from questioning the same.

Lopez filed his Reply, 33 maintaining his previous arguments. He further contends that the Court may exercise its power of review because the CA decision is not in accord with prevailing law and jurisprudence. He also posits that he only highlights the despotic manner that the RTC approved the sale of the Cruzada property and does not put into issue its ownership. Also, he insists on Yap's negligence, considering that the RTC had yet to issue the Order dated February 24, 2020, directing her to submit a final, complete, and updated inventory of the properties of the estate. 34 Under the Rules of Court, the inventory of property precedes the liquidation and distribution of properties; hence, the approval of the sale was a legal shortcut.

Based on the above arguments, the main issue to be resolved is whether the CA committed serious error in not finding that the RTC gravely abused its discretion in approving the sale of the Cruzada property (1) despite the absence of a final and complete inventory; (2) without ascertaining whether it is part of the conjugal assets of Olivia and Miguel; and (3) despite Yap's failure to fulfill her duties as administrator.

The Court's Ruling

The petition lacks merit.

I

The CA decision had already become final and executory; Lopez belatedly filed his petition for review on certiorari.

At the outset, this petition should be denied because the decision of the CA had already become final and executory.

The records show that Lopez received a copy of the CA resolution denying his motion for reconsideration on September 21, 2018. Thus, he only had 15 days or until October 6, 2018, to file a petition for review under Rule 45 of the Rules of Court. Since October 6, 2018 fell on a Saturday, he had until Monday or October 8, 2018, to file the said petition.

Instead of filing the petition, Lopez sought an Extension 35 of 30 days to file the same, which the Court granted, expressly stating that the same shall be counted from the expiration of the reglementary period. 36 However, Lopez belatedly filed the instant Petition on November 7, 2018, having erroneously counted the 30-day period from October 8, 2018 instead of October 6, 2018. Accordingly, the decision of the CA had already become final and executory; thus, this Court has no authority to review the same.

It is a settled rule that once a judgment attains finality, it may no longer be modified in any respect, even if such modification is meant to correct what is perceived to be an erroneous conclusion of fact or law, and regardless of whether the modification is attempted to be made by the court rendering it or by the highest court of the land. 37 Although this doctrine of immutability of judgment admits of exceptions such as: (1) the correction of clerical errors, (2) the so-called nunc pro tunc entries which cause no prejudice to any party, (3) void judgments, and (4) whenever circumstances transpire after the finality of the decision rendering its execution unjust and inequitable, 38 none were presented by Lopez to merit an exemption from this rule.

Even if the Court sets aside the procedural blunder committed by Lopez, the instant petition would still meet the same fate. aScITE

II

The RTC did not gravely abuse its discretion in granting the motion to sell the Cruzada property.

Lopez argues that the RTC gravely abused its discretion when it approved the sale of the Cruzada property based on three grounds: (1) the sale was made in the absence of a final and complete inventory of the properties belonging to the estate; (2) the Cruzada property is part of the conjugal assets of Olivia and Miguel; and (3) Yap has been completely remiss in her duties as administrator of the estate.

The Court has reviewed the records which bear evidence contrary to the allegations presented by Lopez.

The administrator of the estate is only

Lopez has been insistent in arguing that a final and complete inventory should precede any disposition of the estate. He claims that Yap had not submitted a final inventory of the estate; hence, the RTC has no authority to grant or approve the sale of the Cruzada property.

The argument lacks both legal and factual support.

Sec. 1, Rule 83 of the Rules of Court provides for the requirement of inventory of the estate. It reads:

Section 1. Inventory and appraisal to be returned within three months. — Within three (3) months after his appointment, every executor or administrator shall return to the court a true inventory and appraisal of all the real and personal estate of the deceased which has come into his possession or knowledge. In the appraisement of such estate, the court may order one or more of the inheritance tax appraisers to give his or their assistance.

The inventory required under the rules applies to special administrators such as Yap, as it mandates "every executor or administrator" without distinction as to whether the administrator has been provisionally designated as a special administrator. Moreover, Sec. 1 does not require a final and complete inventory to be submitted within three months from appointment of the executor or administrator, but only "a true inventory and appraisal of all the real and personal estate of the deceased which has come into his possession or knowledge." The Court has expounded on the import of this phrase in Aranas v. Mercado39 as referring to those properties known to the administrator to belong to the decedent or in the former's possession, thus:

The usage of the word all in Section 1, [of Rule 83] demands the inclusion of all the real and personal properties of the decedent in the inventory. However, the word all is qualified by the phrase which has come into his possession or knowledge, which signifies that the properties must be known to the administrator to belong to the decedent or are in her possession as the administrator. Section 1 allows no exception, for the phrase true inventory implies that no properties appearing to belong to the decedent can be excluded from the inventory, regardless of their being in the possession of another person or entity. 40

In here, Yap submitted a Partial Inventory of Olivia's estate dated August 24, 2015. Based on this partial list, she was able to identify forty-three (43) real estate properties located in Makati City, Manila, Iloilo, Roxas City, and Capiz. Included in this list were the Cruzada, Real and Limasawa properties in Makati City. Thus, when Yap filed a motion for authority to sell on September 21, 2015, Yap had already submitted a partial inventory with the RTC which included the Cruzada property. Clearly, the RTC did not gravely abuse its discretion in granting the sale considering that the Cruzada property was included in the partial inventory submitted by Yap before she filed for a motion to sell some properties of the estate.

Still, Lopez argues against the propriety of disposing real properties belonging to the estate under the impression that personal property should have been first exhausted. This argument, although legally sound, cannot be sustained.

The rule that personalty should first be charged with the payment of debts and expenses is found in Sec. 3, 41 Rule 88 in relation to Sec. 1, 42 Rule 89 of the Rules of Court. However, Sec. 3, Rule 88 also allows the disposition of real property if the movable property is insufficient to pay for the debts of the estate. Sec. 2 of Rule 89 also provides for exceptions whereby real estate may be disposed despite the non-exhaustion of personal property, viz.:

Sec. 2. When court may authorize sale, mortgage, or other encumbrance of realty to pay debts and legacies though personalty not exhausted. — When the personal estate of the deceased is not sufficient to pay the debts, expenses of administration, and legacies or where the sale of such personal estate may injure the business or other interests of those interested in the estate, and where a testator has not otherwise made sufficient provision for the payment of such debts, expenses and legacies, the court, on application of the executor or administrator and on written notice to the heirs, devisees, and legatees residing in the Philippines, may authorize the executor or administrator to sell, mortgage, or otherwise encumber so much as may be necessary of the real estate, in lieu of personal estate, for the purpose of paying such debts, expenses, and legacies, if it clearly appears that such sale, mortgage, or encumbrance would be beneficial to the persons interested; and if a part cannot be sold, mortgaged, or otherwise encumbered without injury to those interested in the remainder, the authority may be for the sale, mortgage, or other encumbrance of the whole of such real estate, or so much thereof as is necessary or beneficial under the circumstances.

Accordingly, a probate or intestate court may still allow the sale of real property instead of personal property upon application of the administrator, on the following instances: (1) when the personal estate is insufficient to pay for the debts, expenses of administration and legacies; (2) when the sale of movables will injure the business or other interest of those interested in the estate; and (3) when the testator did not provide for the payment of such debts, expenses and legacies.

It is not difficult to discern why the RTC herein did not apply the rule on disposing first the movable property of Olivia's estate. The partial inventory submitted by Yap only listed real properties located in different parts of the country. Verily, the trial court will be liable for grave abuse of discretion if it will order the exhaustion of personalty to pay for debts and administration of the estate when none were included in the inventory.

Notably, Lopez has been insistent on applying the above rule, and even included in his petition, a list of personal properties 43 allegedly belonging to Olivia's estate consisting of the following:

 

Description	Probable Value
19,623 shares of stocks in MIKOL Properties, Inc.	Php1,962,200.00
3,990 shares of stocks in RANCAP Manufacturing, Corp.	Php399,000.00
373 shares of stocks in RANCHO Capiz, Inc.	Php373,000.00
BPI Current Account No. 3125-4339-35
HSBC Time Deposits
RCBC Time Deposits
BPI Safety Deposit Box, Forbes Branch
MetroBank Safety Deposit Box, Main Branch
Several foreign currencies and jewelry found inside the two (2) vaults in the last residence of the Deceased Olivia located at 71 Real St., Urdaneta Village, Makati City

 

Clearly, these properties allegedly belonging to Olivia's estate could not be disposed of at that time because (1) the values were only estimates; (2) majority of the property have no declared or even approximate values; and (3) those with probable values are obviously insufficient to cover even merely the payment of estate taxes. Assuming that these properties were included in the partial inventory submitted by Yap, the RTC still acted within its authority as intestate court, to grant the sale of the Cruzada property under Sec. 2, Rule 89 of the Rules of Court considering that the sum of these movables was insufficient to pay for the debts and administration expenses of the estate, and that the decedent failed to provide for the payment of the same.

Also, the insufficiency of the alleged movables belonging to Olivia's estate was somehow explained by the RTC in its November 5, 2015 Order. Acting on the opposition filed by one of the heirs on Yap's motion for authority to sell, the RTC held that the oppositors failed to provide evidence on the alleged sale by Yap of a vehicle owned by Olivia, and if true, the "amount is miniscule compared to the needs of the estate." 44 Thusly, the rule on exhaustion of personal properties does not find application herein.

The Cruzada property may be sold

Intricately connected with Lopez's argument, that a final and complete inventory should have been previously submitted before disposing of any property of the estate, is that the Cruzada property forms part of the conjugal property of the late Olivia and Miguel. He maintains that he does not put in issue the ownership of the said realty, but only highlights the despotic manner with which the RTC authorized its sale without a provisional determination of whether it is part of the conjugal property of the deceased spouses.

The Court is not convinced. Lopez's convoluted argument of not putting in issue the ownership of the Cruzada property is belied by his position that the RTC gravely abused its discretion in approving its sale without previously determining the nature of its ownership.

The peculiarity in the instant case is that the matter was not raised by Miguel's heirs who would be prejudiced by the sale of the Cruzada property, if it was indeed conjugal. Oddly, it was Lopez, Olivia's nephew and heir, who was persistent in raising the matter despite the same being patently adverse not only to his interest, but to his co-heirs in Olivia's estate as well.

Furthermore, Lopez did not register any opposition or manifestation that the Cruzada property was conjugal when Yap submitted a partial inventory and, later, when she filed a motion for authority to sell. 45 He only put forth the argument of conjugal ownership when Yap was already requesting the RTC to approve the deed of sale. Yet, even if We set aside Lopez's belated argument, the same still ought to be rejected.

The Court scrutinized Lopez's arguments supporting his position that the Cruzada property was conjugal. Unfortunately, aside from his bare allegations, he did not provide sufficient evidence to establish that the said property was acquired during the marriage of Olivia and Miguel. Indeed, there is a presumption under Article 160 46 of the Civil Code that all property of the marriage is presumed to belong to the conjugal partnership. However, the presumption applies only when there is proof that the property was acquired during the marriage. Proof of acquisition during the marriage is an essential condition for the operation of the presumption in favor of the conjugal partnership. 47 For this reason, Lopez's claim of conjugal ownership lacks basis.

Even if We apply the presumption that the Cruzada property is conjugal, Lopez's claim that the RTC had no authority to approve its sale still cannot be sustained.

Sec. 2, Rule 73 of the Rules of Court provides for the settlement of the estate of deceased spouses. Sec. 2 reads:

Section 2. Where estate settled upon dissolution of marriage. — When the marriage is dissolved by the death of the husband or wife, the community property shall be inventoried, administered, and liquidated, and the debts thereof paid, in the testate or intestate proceedings of the deceased spouse. If both spouses have died, the conjugal partnership shall be liquidated in the testate or intestate proceedings of either.

The Court clarified in Philippine Commercial and Industrial Bank v. Escolin, 48 that precisely because the last sentence of Sec. 2 of Rule 73 allows or permits the liquidation of conjugal property in the testate or intestate proceeding of either spouses, it is a matter of sound judicial discretion in which one it should be made.

Assuming that the Cruzada property is part of the conjugal assets of Olivia and Miguel, the liquidation of Miguel's share in the said realty may be done in the intestate proceedings of Olivia's estate. In fact, the liquidation of Miguel's entire share in the conjugal partnership may be done in the said proceedings as it is collateral to the settlement of Olivia's estate; and the same will be more practical and efficient considering that none of his heirs appeared to be interested in initiating a separate proceeding to settle his estate. Thus, the RTC was within its authority to approve the sale of the Cruzada property in order to liquidate Miguel's share therein.

It also bears emphasis that the proceedings below did not only include the heirs of Olivia, but also Miguel's successors. Significantly, in the November 15, 2015 conference conducted in relation to Yap's motion for approval of deed of sale, the trial court granted both Olivia and Miguel's inheritors with sufficient time to secure interested buyers of the property. The trial court even directed Yap to furnish Miguel's heirs with copies of the motion, as well as the deed of sale. 49 Even in its February 4, 2016 Order 50 granting Yap's motion, the RTC noted that one of Miguel's heirs (Manuel Padilla) was unable to produce a buyer although he previously manifested that he knew of a person interested in purchasing the property at a higher amount. The RTC also observed that the heirs of Miguel who are the real parties-in-interest with respect to his estate and share in the conjugal property, were not adverse to the idea of selling the Cruzada property. 51 Apparently, the RTC ensured that the interest of Miguel's successors to his estate were well protected during the intestate proceedings.

More importantly, although not expressly declared by the RTC, the ongoing proceedings below had indications that the estate of Miguel, or at least his share in the conjugal property, was also being settled and liquidated. This was apparent from the manifestations made by Yap in her Motion to Extend Authority to Sell 52 the Real and Limasawa properties, wherein she declared:

4. The purchase price [for the Cruzada property] was used for the payment of the estate tax and the [e]xpenses stated in the motion for authority. The Administrator also paid the estate tax of the properties of the late Miguel Padilla, as required by the Bureau, in the amount of P38 Million, more or less, while the other claims on the estate were also paid.

xxx xxx xxx

8. The Administrator recognizes that some of the properties are conjugal, hence, the late Miguel Padilla is entitled to his conjugal share that will be shared by his compulsory legitimate heirs, unfortunately none of them filed for the settlement of his estate.

9. The estate of Miguel Padilla comprises of 1/2 or 50% of the conjugal properties that will be divided to into [sic] five (5) shares, one (1) share, (10%) share of Olivia Lopez out of the 50% Miguel Padilla Estate, while four (4) shares or forty (40%) out of the 50% for the heirs of Miguel Padilla.

10. The net cash proceeds pertaining to the estate of Miguel Padilla, will be set aside and deposited in a special account for his heirs to settle, among themselves. Thereby the heirs of Miguel Padilla will be aptly secured and protected to await for the filing of settlement of his estate.

Indeed, if Lopez truly believed that there should first be a settlement of whether the Cruzada property is conjugal before it can be disposed, he should have availed of the most expedient remedy provided by Sec. 3, Rule 89 of the Rules of Court which allows the posting of a bond to prevent the sale. Sec. 3 provides:

Section 3. Persons interested may prevent such sale, etc., by giving bond. — No such authority to sell, mortgage, or otherwise encumber real or personal estate shall be granted if any person interested in the estate gives a bond, in a sum to be fixed by the court, conditioned to pay the debts, expenses of administration, and legacies within such time as the court directs; and such bond shall be for the security of the creditors, as well as of the executor or administrator, and may be prosecuted for the benefit of either.

As noted by the RTC in its February 4, 2016 Order, none of the oppositors, including Lopez, posted a bond to prevent Yap from selling the Cruzada property. 53 Ineluctably, the RTC acted well within its jurisdiction when it approved the sale of the subject realty.

No evidence of incompetence of the

Lopez's final argument in support of his petition revolves around the alleged incompetence of Yap as special administrator. He claims that in granting the sale, the trial court failed to recognize Yap's negligence in not submitting a complete and final inventory of the estate, and that her only intention was to dissipate the estate. The CA, however, saw otherwise, given that she had fulfilled her duties based on the authority given to her, and acted "as an officer of the court for the benefit of Olivia's estate and not for her own gain." 54

The Court agrees with the CA.

Indeed, all of Yap's actions as special administrator of Olivia's estate were done in accordance with the limited powers granted to her by the RTC, as well as by the Rules of Court. As previously explained, Sec. 1, Rule 83 of the Rules of Court does not require the submission of a final and complete inventory of the estate within three (3) months of her appointment. Even the performance bond that the trial court required her to post under Sec. 1, Rule 81 of the Rules of Court, is conditioned on her submission of the following:

(1) a true and complete inventory of all goods, chattels, rights, credits, and estate of the deceased which shall come to her possession or knowledge or to the possession or knowledge of any other person for her, within three (3) months from her appointment; and

(2) a true and just account of her administration to the court within one (1) year, and at any other time when required by the court.

Moreover, Yap did not unilaterally decide to sell part of Olivia's estate. Since disposition of the estate is not within her authority as special administrator, she readily sought approval from the RTC pursuant to Sec. 2, 55 Rule 80 of the Rules of Court. Contrary to Lopez's opinion that Yap was keen on dissipating the estate, the sale of some properties were geared towards preserving the estate, considering the interests and penalties that might accrue if the estate taxes and other fees were not paid, and funds to spend for maintaining the estate were not raised.

All told, the CA did not err in dismissing the petition for certiorari filed by Lopez in the absence of grave abuse of discretion on the part of the RTC in issuing its February 4, 2016 and March 29, 2017 Orders. As long as the RTC commits no patently grave abuse of discretion, its orders must be respected as part of the regular performance of its judicial duty. 56

ACCORDINGLY, the Court resolves to DENY the petition for review for being unmeritorious. We hereby AFFIRM the January 30, 2018 Decision and September 11, 2018 Resolution of the Court of Appeals, in CA-G.R. SP No. 151095, and ORDER petitioner Carlos H. Lopez to pay costs of suit.

SO ORDERED."

By authority of the Court:

(SGD.) LIBRADA C. BUENADivision Clerk of Court

By:

MARIA TERESA B. SIBULODeputy Division Clerk of Court

 

Footnotes

1.Rollo, pp. 31-65.

2.Id. at 12-21; penned by Associate Justice Socorro B. Inting, with Associate Justices Apolinario D. Bruselas, Jr. and Rafael Antonio M. Santos, concurring.

3.Id. at 23-25.

4.Id. at 250-254.

5.Id. at 269-273.

6. Entitled "In Re: Settlement of the Intestate Estate of the late Olivia Lopez Vda. De Padilla, Petition for Letters of Administration, Mikol Properties, Inc., petitioner."

7.Rollo, p. 34.

8.Id. at 35.

9.Id. at 37.

10.Id. at 227.

11.Id. at 228.

12.Id. at 233.

13.Id. at 227-235.

14. CA rollo, p. 264, docketed as CA-G.R. SP No. 142241.

15. Docketed as G.R. No. 229631, entitled "Carlos Hernandez Lopez v. Mikol Properties, Inc. and Ma. Teresa de Paula-Yap."

16. CA rollo, pp. 273-274.

17.Rollo, pp. 366-370.

18. The partial inventory enumerated a total of forty-three (43) real estate properties distributed as follows: twelve (12) properties in Makati City; one (1) townhouse in Manila; one (1) residential lot in Iloilo City; eight (8) residential lots, and one (1) road lot in Roxas City; and twelve (12) homelots, one (1) road lot, and seven (7) agricultural lands in Capiz.

19.Rollo, pp. 236-242.

20.Id. at 243-245.

21.Id. at 244.

22.Id. at 246-249.

23.Id. at 250-254.

24.Id. at 254.

25.Id. at 269-273.

26.Id. at 20-21.

27.Id. at 23-25.

28.Id. at 42.

29.Id. at 43.

30.Id. at 48.

31.Id. at 58.

32.Id. at 418-429.

33.Id. at 472-494.

34.Id. at 475-476.

35.Id. at 3-10.

36.Id. at 28; Resolution dated November 21, 2018.

37.Davao ACF Bus Lines v. Ang, G.R. No. 218516, March 27, 2019; Metropolitan Cebu Water District v. Mactan Rock Industries, Inc., 690 Phil. 163, 176 (2012).

38.Heirs of Gabule v. Jumuad, G.R. No. 211755, October 7, 2020; Philippine Health Insurance Corporation v. Commission on Audit, G.R. No. 222710, September 10, 2019.

39. 724 Phil. 174 (2014).

40.Id. at 188-189.

41.Section 3. Personalty first chargeable for debts, then realty. — The personal estate of the deceased not disposed of by will shall be first chargeable with the payment of debts and expenses; and if said personal estate is not sufficient for that purpose, or its sale would redound to the detriment of the participants for the estate, the whole of the real estate not disposed of by will, or so much thereof as is necessary, may be sold, mortgaged, or otherwise encumbered for that purpose by the executor or administrator, after obtaining the authority of the court therefor. Any deficiency shall be met by contributions in accordance with the provisions of Section 6 of this rule.

42.Section 1. Order of sale of personalty. — Upon the application of the executor or administrator, and on written notice to the heirs and other persons interested, the court may order the whole or a part of the personal estate to be sold, if it appears necessary for the purpose of paying debts, expenses of administration, or legacies, or for the preservation of the property.

43.Rollo, p. 36.

44.Id. at 243.

45. CA rollo, p. 141, it appears that only Adriano Lopez and Bettina Lopez filed their written oppositions to the motion. See Motion for Approval of Deed of Sale.

46. Article 160. All property of the marriage is presumed to belong to the conjugal partnership, unless it is proved that it pertains exclusively to the husband or to the wife.

47.Spouses Orsolino v. Frany, 808 Phil. 212, 221-222 (2017); see also Jocson v. Court of Appeals, 252 Phil. 342, 353 (1989), citing Cobb-Perez v. Lantin, 132 Phil. 120, 128-129 (1968).

48. 155 Phil. 228 (1974).

49.Rollo, p. 250.

50.Id. at 250-254.

51.Id. at 251-252.

52. CA rollo, pp. 188-190.

53.Rollo, p. 254.

54.Id. at 74.

55.Section 2. Powers and duties of special administrator. — Such special administrator shall take possession and charge of the goods, chattels, rights, credits, and estate of the deceased and preserve the same for the executors or administrator afterwards appointed, and for that purpose may commence and maintain suits as administrator. He may sell only such perishable and other property as the court orders sold. A special administrator shall not be liable to pay any debts of the deceased unless so ordered by the court. (emphasis supplied)

56.Aranas v. Mercado, supra note 39, at 189.