Rule 74 Summary and Settlement of Estates

A. Extra Judicial Settlement by Agreement Between heirs (Sec. 1,4,5)

1. Substantive Requirements

2. Procedural Requirements CC Art 320, FC Art 234, 236

3. Two-year Lien
- The two year lien upon the real property distributed by extrajudicial or summary
settlement shall be annotated on the title issued to the distributed and, after the lapse of
the period, may be cancelled by the register of deeds without need of a court order (LRC
Circular No 143, dated January 28, 1964.

4. Annulment

5. Cases

a. Monserrat v Ibanez, GR No. L-3367, May 20, 1950
- GR: Where the case is proper for extra judicial settlement, a dissenting heir cannot
insist on instituting administration proceedings which would be superfluous and
unnecessary.

b. Vda. De Rodriguesz et al. vs Tan, 92 Phil 273 (1952)
- (refer to Monserrat) UNLESS he can establish good reasons for not resorting to
an action for partition.

c. Pereira vs CA, 174 SCRA 154 (1989)
- Recourse to an administration proceeding (even if estate has no debts) is
sanctioned ONLY if the heirs have goor reasons for NOT resorting to an action for
partition and the claims of the heirs may be properly ventilated and settled therein

d. Guico vs Bautista, 110 Phil 584 (1960)
- GR for extra-judicial partition of the heirs of the estate: the decedent MUST NOT
have left ant debts,
- BUT, it is sufficient if any debts he (decedent) may have left have been paid at
the time the extrajudicial settlement is entered into

e. Rebong vs Ibanez 79 Phil 324 (1947)
- A bond is required only when personality is involved in the extrajudicial
partition (as the real estate is subject to a lien in favor of creditors, heir or other
persons) for the full period of two years (see two-year lien above) from such
distribution and such lien cannot be substituted by a bond
- Such lien cannot be discharged nor the annotation cancelled within the two-
year period even if the distributes offed to post a bond to answer for the
contingent claims for which the lien is established

f. McMicking vs Sy Conbieng, 21 Phil 221 (1912)
- The discovery of unpaid debts after the extrajudicial settlement has been
effected DOES NOT ipso facto invalidate the partition.
- In this case, the creditor may ask for administration of enough property of the
estate sufficient to pay for the debt, but the heirs can prevent such
administration by paying the obligation.

- OR, the creditor can file an ordinary action against the distributed for his claim

g. Gerona et al vs De Guzman et. al. 11 SCRA 153 (1964)
- The action to annul a deed of extrajudicial settlement on the ground of fraud
should be filed within four years FROM the discovery of fraud.

h. Pedrosa vs CA et al. 353 SCRA 620 (2001)

i. Pada-Kilario vs CA, 322 SCRA 481 (2000)
- The requirement in Sec. 1, Rule 74 of the Revised Rules of Court that a partition
be put in a public document and registered, has for its purpose the protection of
creditors and the heirs themselves against tardy claims. The object of
registration is to serve as constructive notice to others.
- The intrinsic validity of partition not executed with the prescribed formalities is
not undermined when no creditors are involved.

j. Tan vs Benolirao et al, 604 SCRA 36 (2009)

B. Summary Settlement, Secs. 2-5

1. Sampilo et al. vs CA et al, 103 Phil 70 (1958)
- An extrajudicial settlement, despite the publication thereof in a newspaper, shall not be
binding on any person who has not participated therein or who had no notice thereof.
- A summary settlement is likewise NOT binding upon the heirs or creditors who were NOT
parties therein or had no knowledge thereof.



Rule 75 Production, Allowance of Will Necessary
A. Meaning of Probate
1. Due Execution and Extrinsic Validity See Also CC Artss. 783, 838

a. Spouse Pastor vs CA et al, 122 SCRA 885 (1983)
- The probate (allowance or authentication) of a will refers to its due execution
and settles only the formal or extrinsic validity of the will. Ex: whether the
testator, being of sound mind, freely executed the will in accordance with the
formalities prescribed by law.

b. In re Estate of Johnson, 39 Phil 156 (1918)
- Allowance of Will to Probate does not affect or pertain to the intrinsic validity of
the provisions thereof, which determination normally comes after the
allowance of the will.

c. Manahan vs Manahan, 58 Phil 448 (1933)
- Such allowance (of the will to probate) in a final judgment is conclusive on that
issue and cannot be assailed in another proceeding, EXCEPT: on the ground of
fraud in the procurement of the decree

d. Balanay Jr, vs Martinez, 64 SCRA 452 (1975)
- In exceptional cases, as where the defect is apparent on its face, the probate
court may determine the intrinsic validity of the will even before its formal
validity is established, as the probate of a will may become a useless ceremony
if the will is intrinsically invalid
- Doubts should be resolved in favour of testacy, especially where the will evinces
the intent of the testator to dispose of his whole estate.

e. Maninang et al vs. CA et al, 114 SCRA 478 (1982)
- If there is a necessity to resolve the issue as to whether, under the terms of the
will, an heir has been preterited or disinherited and in the latter case, whether
the disinheritance was valid, the procedure followed in the Balanay case cannot
be allowed.
-
2. Nature of Proceedings
a. Fernandez et al vs Dimagiba, 21 SCRA 428 (1967)
- The doctrine of estoppel does not apply in probate proceedings since the
presentation and the probate of a will are required by public policy

b. Betts vs CA, 92 SCRA 332 (1979)
- Probate proceedings involve public interest

B. Responsible Person Secs. 2-5

C. Discovery of Will During Intestate Proceedings
1. Cuenco vs CA et al, Supra
- Testate proceedings take precedence over intestate proceedings for the same estate. If
during the pendency of intestate proceedings, a will of the decedent is discovered,
proceedings for the probate of the will shall replace the intestate proceedings even if an
administrator had already been appointed therein. Should the will not be allowed to
probate, then the proceedings shall be continued as an intestacy

2. Casiano et al vs Maloto et al, 79 SCRA 232 (1977)
- It is NOT proper for the probate court to make a finding in an intestate proceeding that a
will, discovered after the institution of said proceedings, had been revoked. The Court
should order the filing of a petition for the probate of said will by the party interested
therein.