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G.R. No. L-38230 November 21,1933
THE PEOPLE OFTHE PHILIPPINE ISLANDS, plaintiff-appellee,
vs.
BITDU, defendant-appellant.
VICKERS, J.:
Thisis an appeal from the following decision of Judge A.Horilleno in the Courtof First Instance ofZamboanga:
There isno dispute between the prosecution and the defense asto the fact Mora Bitdu was married to Moro Halid before an Imam in Lamitan of this Province of
Zamboanga in accordance with Mohammedan ritesmore than twelve yearsago,and that aboutseven months ago she wasalso married to Moro Hajirol before a Hadji in
accordance with Mohammedan customs.
It is therefore a fact admitted by both the prosecution and the defense that the accused contracted two marriages, one with Halid and another with Hajirol.She claims,
however,that the second marriage contracted by her with Hajirol took place after she had been divorced from her first husband Halid in accordance with Mohammedan customs,
said divorce having taken place before Datu Gavino Cuevas,of Isabela de Basilan.
With this defense, two very importantquestionsare raised before this court:first whether or notthe alleged divorce tookplace in accordance with Mohammedan customs,
and second,assuming that the divorce tookplace in accordance with such customs, is such divorce legal?
With reference to the first question, two witnesses testified, one for the prosecution and the other for the defense.The first witness testified that the divorce between
Mohammedansin Mindanao maybe obtained before anyperson designated and agreed upon bythe parties.The second testified that divorce,like anyother act relative to
marriage and separation ofMohammedan spouses,isobtained under certain conditions, to wit, the interested partiesor the spouses intending to secure a divorce select the
person before whom the divorce is to take place,and both partiesare represented bypersonsdesignated bythem:
Chapter IV, section 35 of the Koran says:
"35.And if you fear a breach between the two, then appointa judge from his people and judge from her people;iftheyboth desire agreement,Allah will effect
harmonybetween them; surelyAllah isknowing;Aware."
The court isinclined to believe that the testimony of the witness for the defense on this question ismore in harmonywith the doctrinesof the Koran than thatof the witness
for the prosecution.
Now, hasthe defense established that the divorce took place in accordance with the commandments ofthe Koran? The defense presented no evidence to showthat the
conditionsprescribed bythe Koran had been complied with bythe partieswhen they obtained their divorce before Datu Cuevas. Said divorce therefore between the defendant
and Halid doesnotsatisfy the conditionsprescribed bythe Koran and consequentlysaid divorce seemsto be of doubtful religiousvalidity.
However, even admitting that thisdivorce was secured in accordance with the conditionsprescribed byMohammedan doctrines,is such divorce legal? The laws
governing marriage and itsincidentsare moral in nature and assuch theyare laws relating to publicpolicy. In the Philippine Islandswe have a law (ActNo. 2710) enumerating
the causes and the conditionsunder which divorce may be secured and granted.Anydivorce obtained in the Philippine Islandsofcausesand under conditionsother than those
enumerated in said law,would have no legal effect. The habitsand customs of a people,the dogmasand doctrinesofa religion cannotbe superior to or have precedence over
laws relating to publicpolicy,because as stated above lawsrelating to marriage and itsincidentsare normal in nature and assuch they affect publicpolicy.
The court therefore is of the opinion thateven ifthe divorce alleged bythe defense wassecured in conformity with Mohammedan doctrines,such divorce cannotprevail
againstthe Divorce Lawof the Philippine Islandsprescribing the causesand conditionsunder which divorce may be obtained.In this case, as above demonstrated,the divorce
in question hasnot been obtained in accordance with the law.
Examined from whatever angle,the divorce alleged bythe defense cannotbe accepted bythis court for the reasonsabove set forth.
In view of the foregoing facts and considerations,we cannotescape the conclusion thatthe defendantherein contracted a second marriage withouther former marriage
having been firstdissolved.
In the consideration ofthis case, however,the court cannotbuttake into account thatthe defendantisa Mohammedan woman;and being a follower ofMohammedan
doctrinesshe no doubtcontracted the second marriage honestlybelieving thatin doing so she was notcommitting any violation ofthe law, although ofcourse her beliefdoesnot
justify her act.
In view of the foregoing,and itappearing thatthe defendantisonlyseventeen years ofage and therefore in the opinion of the courtit would be more convenientfor her to
be sent to the Philippine Training School in Mandaluyong,Manila,(Rizal),itisordered thatthe accused be sent to said institution, to be kept there until she reachesthe age of
majority, all the proceedingsin thiscase being herebysuspended.
The attorney for the defendantallegesthatthe lower courterred in finding thatthe accused committed the crime ofbigamy, and in ordering her to be sentto the Philippine Training
School in Mandaluyong,Rizal.
Appellant'sattorneyadmitsthat the appellantwastwice married asalleged in the information,butcontends thatshe wasdivorced from first husband in accordance with Mohammedan
religiouspractices, and thatsaid divorce was valid;that if it be true thatsaid divorce isnot in accordance with Act No. 2710 ofthe Philippine Legislature,the appellantisneverthelessnot
guiltyof bigamy, because she believed thatshe had been validlydivorced and had no criminal intentwhen contracted the second marriage.
The Solicitor-General agreeswith the attorneyfor the appellant,and isof the opinion thatthe divorce wasgranted in accordance with the precepts of the Koran and Moro customsand
traditions; thatfraudulentor criminal intentis an essential elementof the crime ofbigamy, and thatsince the appellantbelieved thather firstmarriage had been legallydissolved because she
had been granted a divorce under the Mohammedan laws,she cannotbe considered guiltyofthe crime with which she is charged.
The Solicitor-General further arguesthatsince itis the practice ofthe Governmentnotto interfere with the customs of the Moros, especiallytheir religiouscustoms, divorces among
them granted in accordance with the Koran oughtto be recognized asa matter ofpublicpolicy.
There islittle to add to the well considered decision ofthe trial judge.It seems to us unnecessaryto determine whether or notthe divorce in question wasgranted in accordance with
the Mohammedan religiouspractices,as to which there seems to exist considerable uncertainty,because in our viewof the case a valid divorce can be granted onlybythe courts and for the
reasonsspecified in Act No. 2710.It is notclaimed that the appellantwasdivorced from her first husband in accordance with said Act.lawphil.net
In the case of Francisco vs. Tayao (50 Phil.,42), itwas held thatin the Philippinesthe causesfor divorce are prescribed bystatute or Act No. 2710 and that ofthe wife or concubinage
on the partof the husband.
In the recentdecision of People vs.Bituanan (Moro),(56 Phil.,23),where the defendantand a Moro woman were married bya datu according to Moro customs and usagesand
afterwards divorced bythe datu according to the same customs and usages,it washeld that the marriage performed according to the ritesof the Mohammedan religion wasvalid,and
assumed, for the purpose ofthat case, that the defendantand hiswife were notlegallydivorced.
Section 25 ofthe Marriage Law(ActNo. 3613) providesthatmarriagesbetween Mohammedansmaybe performed in accordance with the rites or practice of their religion,butthere is
no provision oflaw which authorizesthe granting ofdivorces in accordance with the ritesor practices of their religion.
A divorce cannotbe had except in thatcourt upon which the state hasconferred jurisdiction, and then onlyfor those causes and with those formalitieswhich the state hasby statute
prescribed (19 C.J., 19).
It is conceded in all jurisdictionsthatpublicpolicy, good morals,and the interests of society require thatthe marriage relation should be sounded with everysafeguard and its
severance allowed onlyin the manner prescribed and for the causesspecified bylaw. And the parties can waive nothing essential to the validity of the proceedings(19 C.J., 20).
With respect to the contention that the appellantacted in good faith in contracting second marriage,believing thatshe had been validlydivorced from her first husband,itis sufficient to
say thatevery one ispresumed to know the law, and the fact that one doesnotknowthat is act constitutes a violation of the lawdoesnot exempthim from the consequencesthereof.The
case ofthe United States vs. Enriquez(32 Phil.,202),cited bythe Solicitor-General isnotin point.In that case the defendantlefthis wife in the municipalityof Orion,Province ofBataan,in
the year 1895,going to the Province ofLaguna asa postal employee.When he returned in 1901,after the revolution,he could not find hiswife or obtain the slightest information asto her
whereaboutsnotwithstanding hispersistent and diligentsearch.Believing her to be dead,he contracted a second marriage in Orion on February1st,1905.In December, 1913,hisfirst wife
made her appearance in Orion.She had been in Manila,Tarlac,and Victoria from 1895 to 1913.The defendantwasacquitted on appeal to thiscourtbecause no fraudulentintentcould be
charged to him. He believed thathis first wife was dead,and thatwas a well-founded belief,although itwas subsequentlyto be erroneous.It wasa mistake offact and notof law.
The decisionsof American courts, cited by the Solicitor- General,sustaining the validityof divorcesgranted to members ofIndian tribesaccording to the customs and usagesthereof,
are likewise not in point.The variousIndian tribes in the United States were dealtwith bythe Governmentofthe United States as independentnationsand treatieswere made with them.
Asto the suggestion of the Solicitor-General thatdivorcesamong the Morosaccording to their religiouspracticesshould be recognized asvalid as a matter of publicpolicy, because in
the contrary case, "there would be no end ofcriminal prosecutions,for polygamystill aboundsamong them,and the remarriagesofpeople divorced under the Koran are the order ofthe
day," thatis a matter for the consideration ofthe Legislature and the Governor-General.
The decision appealed from isaffirmed, with the costs againstthe appellant.
Street, Malcolm,Abad Santos,and Butte, JJ., concur.
G.R. No. L-15645 January 31,1964
PAZ P.ARRIETA andVITALIADO ARRIETA, plaintiffs-appellees,
vs.
NATIONAL RICE AND CORNCORPORATION, defendant-appellant,
MANILA UNDERWRITERS INSURANCE CO., INC., defendant-appellee.
REGALA, J.:
This isan appeal ofthe defendant-appellantNARICfrom the decision ofthe trial courtdated February20,1958,awarding to the plaintiffs-appelleesthe amountof $286,000.00 asdamages
for breach of contract and dismissing the counterclaim and third party complaintofthe defendant-appellantNARIC.
In accordance with Section 13 of RepublicActNo. 3452,"the National Rice and Corn Administration (NARIC) is herebyabolished and all itsassets, liabilities,functions, powerswhich are not
inconsistent with the provisionsofthis Act, and all personnel are transferred "to the Rice and Corn Administration (RCA).
All references,therefore, to the NARIC in thisdecision must accordinglybe adjusted and read asRCA pursuantto the aforementioned law.
On May19, 1952,plaintiff-appellee participated in the publicbidding called bythe NARICfor the supplyof20,000 metric tonsof Burmese rice.As her bid of$203.00 per metricton was the
lowest, she was awarded the contract for the same. Accordingly, on July1, 1952,plaintiff-appellee PazP.Arrieta and the appellantcorporation entered into a ContractofSale ofRice,under
the terms of which the former obligated herselfto deliver to the latter 20,000 metrictons of BurmessRice at $203.00 per metricton, CIF Manila.In turn,the defendantcorporation committed
itself to payfor the imported rice "bymeansof an irrevocable,confirmed and assignable letter ofcredit in U.S. currencyin favor ofthe plaintiff-appellee and/or supplier in Burma,
immediately." Despite the commitment to pay immediately"bymeans ofan irrevocable,confirmed and assignable Letter ofCredit," however,it was onlyon July30, 1952,or a full month
from the execution of the contract, that the defendantcorporation,thru its general manager,tookthe first to open a letter ofcredit byforwarding to the Philippine National BankitsApplication
for Commercial Letter Credit. The application wasaccompanied bya transmittal letter, the relevantparagraphsofwhich read:
In viewof the fact that we do not have sufficient depositwith your institution with which to cover the amountrequired to be deposited asa condition for the opening ofletters of
credit, we will appreciate it ifthis application could be considered special case.
We understand thatour supplier,Mrs. PazP. Arrieta,hasa deadline to meetwhich isAugust 4,1952,and in order to comply therewith, it isimperative that the L/C be opened
prior to that date.We would therefore requestyour full cooperation on thismatter.
On the same day,July 30,1952,Mrs. PazP. Arrieta thru counsel,advised the appellantcorporation ofthe extreme necessity for the immediate opening ofthe letter creditsince she had by
then made a tender to her supplier in Rangoon,Burma,"equivalentto 5% ofthe F.O.B. price of20,000 tons at$180.70 and in compliance with the regulationsin Rangoon this5% will be
confiscated if the required letter ofcreditis notreceived by them before August4, 1952."
On August4, 1952,the Philippine National Bankinformed the appellantcorporation thatitsapplication,"for a letter of creditfor $3,614,000.00 in favor of Thiri Setkya hasbeen approved by
the Board ofDirectors with the condition that marginal cash depositbe paid and thatdrafts are to be paid upon presentment." (Exh.J-pl.; Exh. 10-def.,p. 19,Folder ofExhibits). Furthermore,
the Bankrepresented thatit "will hold your application in abeyance pending compliance with the above stated requirement."
Asit turned out, however,the appellantcorporation notin anyfinancial position to meet the condition.As matter of fact, in a letter dated August2, 1952,the NARIC bluntlyconfessed to the
appellee itsdilemma:"In this connection,please be advised thatour application for opening ofthe letter of credithas been presented to the banksince July 30th butthe latter requiresthat
we first deposit50% ofthe value of the letter amounting to aproximately$3,614,000.00 which we are notin a position to meet." (Emphasissupplied.Exh.9-Def.; Exh. 1-Pe.,p. 18,Folder of
Exhibits)
Consequently,the creditinstrument applied for wasopened onlyon September 8,1952 "in favor ofThiri Setkya, Rangoon,Burma,and/or assignee for $3,614,000.00," (which ismore than
two monthsfrom the execution of the contract) the partynamed bythe appellee asbeneficiaryofthe letter of credit.1äwphï1.ñët
Asa resultof the delay,the allocation ofappellee'ssupplier in Rangoon wascancelled and the 5% deposit,amounting to 524,000 kyatsor approximatelyP200,000.00 wasforfeited.In this
connection,it must be made ofrecord that although the Burmese authoritieshad setAugust4, 1952,asthe deadline for the remittance ofthe required letter ofcredit,the cancellation ofthe
allocation and the confiscation ofthe 5% depositwere not effected until August20,1952,or, a full half month after the expiration ofthe deadline.And yet, even with the 15-daygrace,
appellantcorporation wasunable to make good itscommitment to open the disputed letter of credit.
The appellee endeavored,butfailed,to restore the cancelled Burmese rice allocation.When the futility of reinstating the same became apparent,she offered to substitute Thailand rice
instead to the defendantNARIC, communicating at the same time that the offer was "a solution which should be beneficial to the NARIC and to usat the same time." (Exh.X-Pe., Exh.25—
Def., p.38,Folder of Exhibits).This offer for substitution, however, was rejected by the appellantin a resolution dated November 15,1952.
On the foregoing,the appellee senta letter to the appellant,demanding compensation for the damagescaused her in the sum of $286,000.00,U.S. currency,representing unrealized profit.
The demand having been rejected she instituted this case nowon appeal.
At the instance of the NARIC, a counterclaim was filed and the Manila UnderwritersInsurance Companywas broughtto the suit asa third partydefendantto hold it liable on the performance
bond itexecuted in favor of the plaintiff-appellee.
We find for the appellee.
It is clear upon the recordsthatthe sole and principal reason for the cancellation ofthe allocation contracted by the appellee herein in Rangoon,Burma,wasthe failure of the letter ofcredit
to be opened with the contemplated period.Thisfailure must, therefore,be taken asthe immediate cause for the consequentdamage which resulted.Asit isthen, the disposition ofthis case
dependson a determination ofwho wasresponsible for such failure.Stated differently, the issue is whether appellant'sfailure to open immediatelythe letter ofcredit in dispute amounted to
a breach ofthe contract ofJuly 1,1952 for which itmay be held liable in damages.
Appellantcorporation disclaimsresponsibilityfor the delayin the opening ofthe letter of credit.On the contrary,it insists that the fault lieswith the appellee.Appellantcontendsthatthe
disputed negotiable instrumentwasnot promptlysecured because the appellee ,failed to seasonablyfurnish data necessary and required for opening the same,namely,"(1) the amountof
the letter ofcredit, (2) the person,company or corporation in whose favor it isto be opened,and (3) the place and bankwhere itmaybe negotiated." Appellantwould have thisCourtbelieve,
therefore,that had these informationsbeen forthwith furnished it, there would have been no delayin securing the instrument.
Appellant'sexplanation hasneither force nor merit.In the first place,the explanation reachesinto an area ofthe proceedingsinto which We are notatliberty to encroach.The explanation
refersto a question of fact. Nothing in the record suggestsanyarbitraryor abusive conduct on the partof the trial judge in the formulation ofthe ruling.His conclusion on the matter is
sufficiently borne outbythe evidence presented.We are denied,therefore,the prerogative to disturb that finding,consonantto the time-honored tradition ofthisTribunal to hold trial judges
better situated to make conclusionson questionsof fact. For the record,We quote hereunder the lower court'sruling on the point:
The defense that the delay, ifany in opening the letter ofcreditwas due to the failure ofplaintiff to name the supplier, the amountand the bankisnot tenable.Plaintiffstated in
Courtthat these facts were known to defendanteven before the contract wasexecuted because these facts were necessarily revealed to the defendantbefore she could qualify
asa bidder.She stated too that she had given the necessary data immediatelyafter the execution of Exh."A" (the contract ofJuly 1, 1952) to Mr.GABRIEL BELMONTE,
General Manager ofthe NARIC, both orallyand in writing and thatshe also pressed for the opening ofthe letter ofcredit on these occasions. These statements have notbeen
controverted and defendantNARIC, notwithstanding its previousintention to do so,failed to presentMr. Belmonte to testify or refute this. ...
Secondly,from the correspondence and communicationswhich form partof the record of thiscase, it is clear thatwhat singularlydelayed the opening ofthe stipulated letter of creditand
which, in turn,caused the cancellation ofthe allocation in Burma,wasthe inability ofthe appellantcorporation to meetthe condition importation bythe Bankfor granting the same. We do not
think the appellantcorporation can refute the fact that had itbeen able to putup the 50% marginal cash depositdemanded by the bank,then the letter of creditwould have been approved,
opened and released asearlyasAugust4,1952.The letter of the Philippine National Bankto the NARIC was plain and explicitthatas ofthe said date,appellant's"application for a letter of
credit... hasbeen approved bythe Board ofDirectorswith the condition that 50% marginal cash depositbe paid and thatdrafts are to be paid upon presentment." (Emphasissupplied)
The liabilityof the appellant,however,stems notalone from this failure or inabilityto satisfy the requirementsofthe bank.Its culpability arisesfrom its willful and deliberate assumption of
contractual obligationseven asit was well aware ofits financial incapacity to undertake the prestation. We base this judgmentupon the letter which accompanied the application filed bythe
appellantwith the bank, a partof which letter wasquoted earlier in thisdecision.In the said accompanying correspondence,appellant admitted and owned thatitdid "nothave sufficient
depositwith your institution (the PNB) with which to cover the amountrequired to be deposited asa condition for the opening ofletters ofcredit. ... .
A number oflogical inferencesmay be drawn from the aforementioned admission.First, that the appellantknewthe bankrequirementsfor opening lettersofcredit; second,that appellant
also knew itcould not meetthose requirement.When,therefore,despite thisawarenessthat was financiallyincompetentto open a letter ofcredit immediately, appellantagreed in paragraph
8 of the contract to payimmediately"by meansofan irrevocable,confirm and assignable letter ofcredit," it must be similarlyheld to have bound itself to answer for all and every
consequencesthat would resultfrom the representation.aptlyobserved bythe trial court:
... Having called for bidsfor the importation ofrice involving millions,$4,260,000.00 to be exact, it should have a certained itsability and capacityto comply with the inevitably
requirementsin cash to payfor such importation.Having announced the bid,it must be deemed to have impliedlyassured suppliersofits capacity and facility to finance the
importation within the required period,especiallysince ithad imposed the supplier the 90-dayperiod within which the shipmentofthe rice must be broughtinto the Philippines.
Having entered in the contract, it should have taken steps immediately to arrange for the letter of creditfor the large amountinvolved and inquired into the possibilityofits
issuance.
In relation to the aforequoted observation ofthe trial court, We would like to make reference also to Article 11 of the Civil Code which provides:
Those who in the performance oftheir obligation are guiltyoffraud, negligence,or delay,and those who in anymanner contravene the tenor thereof,are liable in damages.
Under this provision,notonlydebtorsguilty offraud, negligence or defaultin the performance ofobligationsa decreed liable;in general,everydebtor who failsin performance ofhis
obligationsisbound to indemnifyfor the losses and damagescaused thereby(De la Cruz SeminaryofManila, 18 Phil.330;Municipalityof Moncada v.Cajuigan,21 Phil.184;De la Cavada
v. Diaz, 37 Phil.982;Maluenda & Co.v. Enriquez,46 Phil.916;Pasumil v. Chong,49 Phil.1003;Pando v. Gimenez,54 Phil. 459;Acme Films v. Theaters Supply,63 Phil.657).The phrase
"anymanner contravene the tenor" of the obligation includesanyillicitact which impairsthe strict and faithful fulfillmentof the obligation or everykind or defective performance.(IV Tolentino,
Civil Code ofthe Philippines,citing authorities, p.103.)
The NARIC would also have this Court hold thatthe subsequentoffer to substitute Thailand rice for the originallycontracted Burmese rice amounted to a waiver by the appellee ofwhatever
rightsshe mighthave derived from the breach ofthe contract. We disagree.Waiversare notpresumed,butmust be clearlyand convincinglyshown,either by expressstipulation or acts
admitting no other reasonable explanation.(Ramirezv.Court ofAppeals,52 O.G. 779.) In the case at bar,no such intent to waive hasbeen established.
We have carefully examined and studied the oral and documentaryevidence presented in thiscase and upon which the lower courtbased its award.Under the contract, the NARIC bound
itself to buy20,000 metric tons of Burmese rice at"$203.00 U.S. Dollarsper metricton, all net shipped weight,and all in U.S. currency,C.I.F. Manila ..." On the other hand,documentaryand
other evidence establish with equal certaintythat the plaintiff-appellee wasable to secure the contracted commodity at the cost price of $180.70 per metricton from her supplier in Burma.
Considering freights,insurance and chargesincidentto its shipmenthere and the forfeiture of the 5% deposit, the award granted bythe lower court isfair and equitable.For a clearer viewof
the equity ofthe damagesawarded,We reproduce belowthe testimonyofthe appellee,adequatelysupported bythe evidence and record:
Q.Will you please tell the court, howmuch isthe damage you suffered?
A. Because the selling price ofmy rice is $203.00 per metricton, and the cost price ofmy rice is $180.00 We had to payalso $6.25 for shipping and about$164 for insurance.
So adding the cost ofthe rice,the freight, the insurance, the total would be about$187.99 thatwould be $15.01 grossprofitper metricton, multiply by20,000 equals$300,200,
that ismy supposed profitif I wentthrough the contract.
The above testimony of the plaintiff wasa general approximation ofthe actual figuresinvolved in the transaction. A precise and more exactdemonstration of the equity ofthe award herein is
provided byExhibitHH ofthe plaintiffand Exhibit34 of the defendant,hereunder quoted so far asgermane.
It is equallyofrecord nowthat asshown in her requestdated July 29,1959,and other communicationssubsequentthereto for the opening byyour corporation ofthe required
letter of credit, Mrs. Arrieta wassupposed to payher supplier in Burma atthe rate of One Hundred EightyDollarsand SeventyCents($180.70) in U.S.Currency, per ton plus
EightDollars($8.00) in the same currencyper ton for shipping and other handling expenses,so thatshe isalreadyassured ofa net profitof Fourteen Dollarsand ThirtyCents
($14.30),U.S., Currency, per ton or a total ofTwo Hundred and EightySixThousand Dollars($286,000.00),U.S.Currency, in the aforesaid transaction. ...
Lastly, herein appellantfiled a counterclaim asserting thatit hassuffered, likewise byway ofunrealized profitdamagesin the total sum of $406,000.00 from the failure ofthe projected
contract to materialize.Thiscounterclaim wassupported bya cost study made and submitted bythe appellantitselfand wherein itwas illustrated howindeed had the importation pushed
thru, NARIC would have realized in profitthe amountasserted in the counterclaim.And yet, the said amountofP406,000.00 wasrealizable byappellantdespite a number ofexpenseswhich
the appellee under the contract,did not have to incur. Thus,under the cost study submitted bythe appellant,banking and unloading chargeswere to be shoulderedbyit,including an Import
License Fee of 2% and superintendence fee of$0.25 per metricton.If the NARIC stood to profit over P400 000.00 from the disputed transaction inspite of the extra expendituresfrom which
the herein appellee wasexempt,we are convicted of the fairnessof the judgmentpresentlyunder appeal.
In the premises, however,a minor modification must be effected in the dispositive portion ofthe decision appeal from insofar asit expressesthe amountofdamagesin U.S. currencyand not
in Philippine Peso.RepublicAct529 specificallyrequiresthe discharge ofobligationsonly"in any coin or currencywhich at the time of paymentislegal tender for publicand private debts."
In viewof thatlaw, therefore,the award should be converted into and expressed in Philippine Peso.
This bringsusto a consideration ofwhatrate of exchange should applyin the conversion here decreed.Should itbe atthe time ofthe breach,at the time the obligation wasincurred or atthe
rate of exchange prevailing on the promulgation ofthisdecision.
In the case of Engel v.Velasco & Co., 47 Phil.115,We ruled thatin an action for recovery ofdamagesfor breach ofcontract, even if the obligation assumed bythe defendantwasto paythe
plaintiff a sum of moneyexpressed in American currency, the indemnityto be allowed should be expressed in Philippine currencyatthe rate ofexchange atthe time of the judgmentrather
than at the rate of exchange prevailing on the date ofdefendant'sbreach.Thisruling,however,can neither be applied nor extended to the case at bar for the same waslaid down when
there was no lawagainststipulating foreign currenciesin Philippine contracts.But nowwe have RepublicAct No. 529 which expresslydeclaressuch stipulationsas contraryto publicpolicy,
void and ofno effect. And,as We alreadypronounced in the case of Eastboard Navigation,Ltd. v. Juan Ysmael & Co., Inc., G.R. No. L-9090,September 10,1957,ifthere isanyagreement
to payan obligation in a currencyother than Philippine legal tender,the same isnull and void ascontraryto publicpolicy (RepublicAct529),and the most that could be demanded isto pay
said obligation in Philippine currency"to be measured in the prevailing rate ofexchange atthe time the obligation wasincurred (Sec.1,idem)."
UPONALL THE FOREGOING, the decision appealed from isherebyaffirmed, with the sole modification that the award should be converted into the Philippine peso atthe rate of exchange
prevailing atthe time the obligation wasincurred or on July1, 1952 when the contractwas executed. The appellee insurance company,in the lightofthis judgment,is relieved of anyliability
under thissuit. No pronouncementasto costs.
G.R. No. 108947 September29,1997
ROLANDO SANCHEZ, FLORIDA MIERLY SANCHEZ, ALFREDO T. SANCHEZ and MYRNAT. SANCHEZ, petitioners,
vs.
THE HONORABLE COURT OF APPEALS,ROSALIA S. LUGOD,ARTURO S.LUGOD, EVELYNLUGOD-RANISES and ROBERTO S. LUGOD, respondents.
PANGANIBAN, J.:
Is a petition for certiorari,in lieu ofappeal,the proper remedyto correct ordersofa probate courtnullifying certain deedsof sale and,thus, effectively passing upon title to the properties
subject ofsuch deeds? Isa compromise agreementpartitioning inherited propertiesvalid even withoutthe approval ofthe trial courthearing the intestate estate ofthe deceased owner?
The Case
These questionsare answered bythis Court asit resolvesthe petition for reviewon certiorari before usassailing the November 23, 1992 Decision1
of the Courtof Appeals2
in CA-G.R.SP
No. 28761 which annulled the decision3
ofthe trial court4
and which declared the compromise agreement among the partiesvalid and binding even withoutthe said trial court's approval.
The dispositive portion ofthe assailed Decision reads:
WHEREFORE, for the reasonshereinabove setforth and discussed,the instantpetition is GRANTEDand the challenged decision aswell asthe subsequentorders
of the respondentcourtare ANNULLEDand SETASIDE.The temporary restraining order issued bythisCourton October 14, 1992 ismade PERMANENT.The
compromise agreementdated October 30,1969 asmodified bythe memorandum ofagreementofApril 13,1970 isDECLAREDvalid and binding upon herein
parties. And Special ProceedingsNo.44-M and 1022 are deemed CLOSEDand TERMINATED.
SO ORDERED.5
The AntecedentFacts
The facts are narrated bythe Courtof Appealsas follows:
[Herein private respondent]Rosalia S. Lugod isthe onlychild of spousesJuan C. Sanchezand Maria Villafranca while [herein private respondents]Arturo S.Lugod,
Evelyn L. Ranisesand Roberto S.Lugod are the legitimate children of[herein private respondent]Rosalia.
[Herein petitioners] Rolando,Florida Mierly,Alfredo and Myrna,all surnamed Sanchez,are the illegitimate children ofJuan C. Sanchez.
Following the death of her mother,Maria Villafranca,on September 29,1967,[herein private respondent]Rosalia filed on January22,1968,thru counsel,a petition
for letters of administration over the estate ofher mother and the estate of her father,Juan C. Sanchez, who was atthe time in state of senility(Annex"B", Petition).
On September 30,1968,[herein private respondent]Rosalia,asadministratrix ofthe intestate estate of her mother,submitted an inventory and appraisal ofthe real
and personal estate ofher late mother (Annex"C",Petition).
Before the administration proceedingsSpecial in ProceedingsNo.44-M could formallybe terminated and closed,Juan C. Sanchez,[herein private respondent]
Rosalia'sfather, died on October 21,1968.
On January14,1969,[herein petitioners]as heirsofJuan C. Sanchez,filed a petition for letters of administration (Special ProceedingsNo.1022) over the intestate
estate ofJuan C. Sanchez, which petition was opposed by(herein private respondent) Rosalia.6
On October 30,1969,however,[herein private respondent]Rosalia and [herein petitioners] assisted bytheir respective counselsexecuted a compromise
agreement(Annex"D",Petition) wherein theyagreed to divide the propertiesenumerated therein ofthe late Juan C. Sanchez.
On November 3,1969,petitioner Rosalia was appointed by[the trial court], and tookher oath as the administratrixof her father'sintestate estate.
On January19,1970,[herein petitioners]filed a motion to require administratrix,[herein private respondent]Rosalia,to deliver deficiencyof 24 hectaresand or to
set aside compromise agreement(Annex"E",Petition).
Under date ofApril 13,1970,(herein private respondent) Rosalia and [herein petitioners]entered into and executed a memorandum ofagreementwhich modified
the compromise agreement(Annex"F".Petition)
On October 25,1979,or nine yearslater, [herein petitioners]filed,thru counsel,a motion to require [herein private respondent] Rosalia to submita newinventory
and to render an accounting over propertiesnotincluded in the compromise agreement(Annex"G", Petition).Theylikewise filed a motion to defer the approval of
the compromise agreement(Annex"H", Ibid),in which theyprayed for the annulmentofthe compromise agreementon the ground offraud.
On February4,1980,however,counsel for [herein petitioners]moved to withdrawhisappearance and the two motions he flied,Annex"G" and "H" (Annex"I",
Petition).
On February28,1980,the [trial] court issued an order directing [herein private respondent]Rosalia to submita new inventoryofpropertiesunder her administration
and an accounting ofthe fruits thereof,which prompted [herein private respondent]Rosalia to file a rejoinder on March 31, 1980 (Annex"K",Petition).
On May12, 1980,[herein petitioners],thru new counsel,filed a motion to change administratrix(Annex"L",Petition) to which [herein private respondent]Rosalia
filed an opposition (Annex"M", Ibid).
The partieswere subsequentlyordered to submit their respective position papers, which they did (Annexes"N" and "O",Petition).On September 14,1989,former
counsel of (herein petitioners) entered hisre-appearance ascounsel for (herein petitioners).
On the bases ofmemoranda submitted bythe parties,the [trial court], thistime presided byJudge Vivencio A.Galon,promulgated itsdecision on June 26,1991,
the dispositive portion ofwhich states:
WHEREFORE, premisesconsidered,judgmentisherebyrendered asfollowsbydeclaring and ordering:
1. Thatthe entire intestate estate of Maria Villafranca Sanchezunder Special Proceedings No.44-M consistsof all her paraphernal
propertiesand one-half(1/2) ofthe conjugal propertieswhich mustbe divided equallybetween Rosalia Sanchezde Lugod and Juan C.
Sanchez;
2. Thatthe entire intestate estate of Juan C. Sanchezunder Special ProceedingsNo.1022 consistsofall hiscapital properties,one-half
(1/2) from the conjugal partnership ofgainsand one-half(1/2) ofthe intestate estate of Maria Villafranca under Special ProceedingsNo.
44-M;
3. Thatone-half(1/2) ofthe entire intestate estate of Juan C. Sanchezshall be inherited byhisonlylegitimate daughter,Rosalia V.
Sanchezde Lugod while the other one-half(1/2) shall be inherited and be divided equallyby,between and among the six(6) illegitimate
children,namely:Patricia Alburo,Maria Ramuso Sanchez, Rolando Pedro T.Sanchez,Florida MierlyT. Sanchez,Alfredo T.Sanchezand
Myrna T. Sanchez;
4. Thatall the Deed (sic) of Absolute Salesexecuted byJuan C. Sanchezand Maria Villafranca in favor ofRosalia SanchezLugod,Arturo
S. Lugod,Evelyn S.Lugod and Roberto S.Lugod on July26,1963 and June 26,1967 are all declared simulated and fictitiousand mustbe
subject to collation and partition among all heirs;
5. Thatwithin thirty (30) daysfrom finality of thisdecision, Rosalia SanchezLugod isherebyordered to prepare a projectofpartition ofthe
intestate estate ofJuan C. Sanchezunder Special ProceedingsNo.1022 and distribute and deliver to all heirstheir corresponding shares.
If she fails to do so within the said thirty (30) days, then a Board ofCommissionersis herebyconstituted, who are all entitled to honorarium
and per diemsand other necessaryexpenseschargeable to the estate to be paid byAdministratrixRosalia S. Lugod,appointing the
Community Environmentand Natural ResourcesOfficer (CENRO) ofGingoog Cityas membersthereof, with the task to prepare the
projectof partition and deliver to all heirstheir respective shares within ninety(90) days from the finality of said decision;
6. Thatwithin thirty (30) daysfrom receipt ofthis decision,Administratrix Rosalia SanchezVda.de Lugod isherebyordered to submittwo
(2) separate certified true and correct accounting,one for the income ofall the propertiesofthe entire intestate estate ofMaria Villafranca
under Special ProceedingsNo.44-M,and another for the propertiesofthe entire intestate estate of Juan C. Sanchezunder Special
ProceedingsNo.1022 dulyboth signed byher and both verified bya Certified PublicAccountantand distribute and deliver to her six (6)
illegitimate brothersand sisters in equal shares,one-half(1/2) ofthe net income ofthe estate ofJuan C. Sanchezfrom October 21,1968
up to the finality ofthis decision;
7. For failure to render an accounting reportand failure to give cash advancesto the illegitimate children ofJuan C. Sanchezduring their
minorityand hour ofneed from the netincome of the estate ofJuan C. Sanchez,which adverselyprejudiced their social standing and
pursuitof college education,(the trial court) herebyordersRosalia SanchezVda.de Lugod to payher six(6) illegitimate brothersand
sisters the sum of Five Hundred Thousand (P500,000.00) Pesos,asexemplarydamages,and also the sum of One Hundred Fifty
Thousand (P150,000.00) Pesosfor attorney'sfees;
8. Upon release ofthisdecision and during itspendency,should appeal be made,the Register of Deedsand Assessors ofthe Provinces
and Cities where the propertiesofJuan C. Sanchezand Maria Villafranca are located,are all ordered to register and annotate in the title
and/or tax declarations,the dispositive portion ofthis decision for the protection of all heirsand all those who may be concerned.
SO ORDERED.
[Herein private respondent]Rosalia filed a motion for reconsideration dated July17,1991 (Annex"P",Petition) on August6, 1991.
On August13,1991,[herein petitioners]filed a motion for execution and opposition to [herein private respondent]Rosalia's motion for reconsideration (Annex"Q",
Petition).
On September 3,1991,[the trial court] issued an OmnibusOrder (Annex"S",Petition) declaring,among other things,thatthe decision at issue had become final
and executory.
[Herein private respondent]Rosalia then filed a motion for reconsideration ofsaid OmnibusOrder (Annex"T",Petition).Said [herein private respondent]was
allowed to file a memorandum in supportofher motion (Annex"V",Petition).
On June 26,1991,[the trial court] issued and Order denying petitioner Rosalia'smotion for reconsideration (Annex"W",Petition).7
Thereafter,private respondentselevated the case to the Courtof Appealsvia a petition for certiorari and contended:
I
The [trial court] hasno authorityto disturb the compromise agreement.
II
The [trial court] hasarbitrarilyfaulted [herein private respondent]Rosalia S.Lugod for alleged failure to render an accounting which wasimpossible.
III
The [trial court] acted without jurisdiction in derogation ofthe constitutional rights of[herein private respondents]Arturo S. Lugod,Evelyn L.Ranisesand Roberto S.
Lugod when [the trial court] decided to annul the deed ofsale between the said [herein private respondents]and Juan C.Sanchezwithout affording them their day
in court.
IV
[The trial courtjudge]defied without rhyme or reason well-established and entrenched jurisprudence when he determined factssansanyevidence thereon.
V
[The trial court] grosslymisinterpreted [herein private respondent]Rosalia S.Lugod'srightto appeal.8
For clarity's sake, this Courtherebyreproducesverbatim the compromise agreement9
of the parties:
COMPROMISE AGREEMENT
COME NOW, the partiesin the above-entitled case,motivated bytheir mutual desire to preserve and maintain harmoniousrelationsbetween and among
themselves, for mutual valuable considerationsand in the spiritofgood will and fair play, and,for the purpose ofthisCompromise Agreement,agree to the
following:
1. Thatthe deceased Juan C. Sanchezwho died intestate on October 21,1968 waslegallymarried to Maria Villafranca de Sanchez,who predeceased her on
September 29,1967,outof whose wedlockRosalia SanchezLugod,Oppositor herein,wasborn,thus making her the sole and only surviving legitimate heir of her
deceased parents;
2. Thatthe said deceased Juan C.Sanchez, leftillegitimate children,Intervenors-Oppositorsand Petitioners,respectively, herein namely;
(1) Patricio Alburo,born outofwedlock on March 17,1926 atCebu City, Philippines,to Emilia Alburo;
(2) Maria Ramoso Sanchez,born outof wedlockon May 9,1937 at Gingoog,MisamisOriental,now,Gingoog
City, to Alberta Ramoso;
(3) (a) Rolando Pedro Sanchez,born on May19,1947,
(b) Florida MierlySanchez,born on February16,1949,
(c) Alfredo Sanchez,born on July21, 1950,and
(d) Myrna Sanchez,born on June 16,1952, all born outof wedlockto Laureta Tampusin Gingoog City,
Philippines.
3. Thatthe deceased Juan C. Sanchezleft the following properties,to wit:
I. SEPARATE CAPITAL OFJUAN C. SANCHEZ
NATURE, DESCRIPTION AND AREA ASSESSEDVALUE
(1) Agricultural Land.Covered byTax. Decl. No.06458,Cad. LotNo. 1041 C-2,located at Murallon,Gingoog Cityand bounded on the North byLotNos. 1033,
1035,1036,1037,1039,1040,1042 & 1043;South byLotNo. 1080,1088,1087 & 1084;EastbyLotNos. 1089,1061 & 2319;West byLot Nos. 954,1038,1057 &
1056,containing an area ofONE HUNDRED EIGHTY THREE THOUSAND SIX HUNDRED SEVENTY TWO (183,672) sq. ms. more or less.
P21,690.00
II. CONJUGAL PROPERTY OFJUAN C. SANCHEZAND MARIA VILLAFRANCA DE SANCHEZ
(1) Agricultural Land.Covered byTaxDecl. No. 06447,Cad.Lot No.2745,C-7 located atAgay-ayan,Gingoog Cityand bounded on the North byLotNos. 2744,
2742,2748;South byLotNo. 2739;East byLot No.2746;West by LotNo. 2741,containing an area ofFOURTEENTHOUSAND SEVENHUNDRED (14,700) sq.
ms. more or less.
P1,900.00
(2) Agricultural Land.Covered byTaxDecl. No. 06449,Cad,Lot No.3271 C-7 located at Panyangan,Lanao,Gingoog Cityand bounded on the North byLotNo.
3270;South byLot Nos. 2900 & 3462;EastbyPanyangan River & F. Lumanao;and PartofLot3272;and West bySamayCreek, containing an area ofONE
HUNDRED FOUR THOUSAND SIX HUNDRED (104,600) sq.ms. more or less.
P11,580.00
(3) Agricultural Land.Covered byTaxDecl. No. 06449,Cad.Lot No.2319,Case 2,located at Murallon,Gingoog Cityand bounded on the North byLotNo. 1061;
South byHinopolan Creek;East byLot No.1044;and West byLot No.1041,containing an area ofTHREE THOUSANDTWO HUNDRED TWENTY FIVE (3,225)
sq. ms. more or less.
(4) Agricultural Land.Covered byTaxDecl. No. 06452,Cad.Lot No.3272,C-7 Part 4 located atPanyangan,Lunao,Gingoog Cityand bounded on the North byLot
Nos. 3270 & 3273;Eastby Panyangan River;South byPanyangan River;and Westby LotNos. 3270 & 3271,containing an area ofFIFTY FIVE THOUSAND SIX
HUNDRED (55,600) sq. ms. more or less, being claimed byDamian Querubin.
P2,370.00
(5) Agricultural Land.Covered byTaxDecl. No. 06453,Cad.Lot No.3270 Case 7, located at Sunog,Lunao,Gingoog Cityand bounded on the North bySamay
Creek& Lot 3267;South byLotNos. 3271 & 3272;East byLotNos. 3269 & 3273;and West bySamayCreek, containing an area of FOURHUNDRED EIGHT
THREE THOUSANDSIX HUNDRED (483,600) sq.ms. more or less.
P61,680.00
(6) Agricultural Land.Covered byTaxDecl. No. 06457,Cad.Lot No.3273,C-7 Part 2 located atPanyangan,Lunao,Gingoog Cityand bounded on the North byLot
No. 3269;South byLotNo. 3272;East byPanyangan River;and Westby LotNo. 3270,containing an area ofTHIRTY FOUR THOUSANDTHREE HUNDRED
(34,300) sq.ms. more or less, being claimed byMiguel Tuto.
P3,880.00
(7) Agricultural Land.Covered byTaxDecl. No. 12000,Cad.Lot No.2806,Case 7 located at Agayayan,Gingoog Cityand bounded on the North byAgayayan
River; South byVictoriano Barbac;Eastby Isabelo Ramoso; and Westby Restituto Baol,containing an area ofSIX THOUSAND SIX HUNDRED SEVENTY SIX
(6,676) sq.ms. more or less.
P380.00
(8) Agricultural Land.Covered byTaxDecl. No. 12924,Cad.Lot No.1206 C-1 located at Cahulogan,Gingoog Cityand bounded on the NW.,byLotNo. 1209;SW.,
byLot No. 1207;EastbyNational Highway; and West byLotNo. 1207;containing an area ofFOURTHOUSAND FIVE HUNDRED THIRTEEN (4,513) sq. ms. more
or less.
P740.00
(9) Agricultural Land.Covered byTaxDecl. No. 12925,Cad.Lot No.5554,located at Tinaytayan, Pigsalohan,Gingoog Cityand bounded on the North byLotNos.
5559 & 5558;South byLotNo. 3486;Eastby LotNo. 5555;and West byLotNo. 5355,containing an area ofEIGHTEENTHOUSAND FIVE HUNDRED TWENTY
EIGHT (18,528) sq.ms. more or less.
P320.00
(10) Agricultural Land.Covered byTaxDecl. No. 12926,Cad.LotNo. 5555 C-7 located at Tinaytayan,Pigsalojan,Gingoog Cityand bounded on the North by
Tinaytayan Creek & LotNos. 5557 & 5558;South byLotNos. 3486,3487,3488,3491 & 3496;EastbyCr. & LotNo. 3496;and West byLotNo. 5554,containing an
area ofSEVENTY SEVENTHOUSANDSEVENHUNDRED SEVENTY SIX (77,776) sq.ms. more or less.
P1,350.00
(11) A Commercial Land.Covered byTax Decl. No. 06454,Cad.LotNo. 61-C-1 located atGuno-Condeza Sts., Gingoog Cityand bounded on the North byLot64;
South byRoad-Lot613 Condeza St; Eastby LotNos. 63,and 62;West by Road-Lot614-Guno St.,containing an area ofONE THOUSANDFORTY TWO (1,042)
sq. ms. more or less.
P9,320.00
(12) A Commercial Land.Covered byTax Decl. No. 06484,LotNo. 5,Block 2,located at Cabuyoan,Gingoog Cityand bounded on the North byLotNo. 4,block 2;
South byLot No.8, block2; East byLotNo. 6, block2, West bySubdivision Road,containing an area ofFOURHUNDRED (400) sq.ms. more or less.
P12,240.00
(13) A Commercial Land.Covered byTax Decl. No. 15798,BlockNo. 7-A-16-0 located atCabuyoan,Gingoog Cityand bounded on the North byLotNo. 7-A-16-0;
South byLot No.7-16-0;East byLotNo. 7-A-18-Road;Westby LotNo. 8,PSU-120704-Julito Arengo vs.Restituto Baol,containing an area ofTWO HUNDRED
SIXTEEN(216) sq.ms. more or less.
P1,050.00
(14) Agricultural Land.Covered byTax,Decl. No. 06789,Cad.Lot No. 5157-C-7,located atKiogat,Agayayan,Gingoog Cityand bounded on the North byLotNo.
5158,5159,5156;South bySE-Steep Bank;Eastby NW, byLot No.5158,Villafranca,containing an area ofNINETY SIX THOUSAND TWO HUNDRED (96,200)
sq. ms. more or less.
P3,370.00
III. PERSONAL ESTATE (CONJUGAL)
NATURE ANDDESCRIPTION LOCATION APPRAISAL
1. Fifty (50) sharesof stock
Rural BankofGingoog,Inc.
at P100.00 per share P5,000.00
2. Four (4) sharesofPreferred Stock
with San Miguel Corporation 400.00
4. That, the partieshereto have agreed to divide the above-enumerated propertiesin the following manner,to wit:
(a) To Patricio Alburo,Maria Ramoso Sanchez, Roland Pedro T.Sanchez,Florida MierlySanchez,Alfredo T.
Sanchezand Myrna T. Sanchez,in equal pro-indiviso shares,considering notonlytheir respective areasbutalso
the improvements existing thereon,to wit:
Agricultural Land.Covered byTaxDecl. No. 06453,Cad.Lot No.3270 Case 7, located at Sunog,Lunao,
Gingoog Cityand bounded on the North bySamayCreek& Lot 3267;South byLotNos. 3271 and 3272;Eastby
LotNos. 3269 & 3273;and West bySamayCreek, containing an area ofFOURHUNDRED EIGHTY THREE
THOUSAND SIX HUNDRED (483,600) sq.ms. and assessed in the sum of P61,680.00.
(b) To Rosalia SanchezLugod all the rest ofthe properties,both real and personal,enumerated above with the
exception of the following:
(1) Two Preferred SharesofStockin the San Miguel Corporation,indicated in San
Miguel Corporation StockCertificate No. 30217,which two sharesshe is ceding in favor
of Patricio Alburo;
(2) The house and lotdesignated asLotNo. 5, Block2 together with the improvements
thereon and identified asparcel No.II-12, lot covered byTax Decl. No.15798 identified
asParcel No. II-13 in the above enumerated,and Cad.LotNo. 5157-C-7 together with
the improvements thereon,which is identified asparcel No.II-14 of the above-
enumeration ofproperties,which said Rosalia S. Lugod islikewise ceding and
renouncing in favor ofRolando Pedro,Florida Mierly,Alfredo and Myrna,all surnamed
Sanchez,in equal pro-indiviso shares;
5. ThatRolando Pedro,Florida Mierly,Alfredo and Myrna,all surnamed Sanchezherebyacknowledge to have received jointlyand severallyin form ofadvances
after October 21,1968 the aggregate sum ofEIGHT THOUSANDFIVE HUNDRED THIRTY-THREE PESOS (P8,533.94) and NINETY-FOURCENTAVOS;
6. Thatthe parties hereto likewise acknowledge and recognize in the indebtednessofthe deceased Juan G.Sanchezand hisdeceased wife Maria Villafranca
Sanchezto the Lugod Enterprises,Inc., in the sum of P43,064.99;
7. Thatthe parties hereto shall be responsible for the paymentof the estate and inheritance taxesproportionate to the value oftheir respective sharesas maybe
determined bythe Bureau ofInternal Revenue and shall likewise be responsible for the expensesof survey and segregation of their respective shares;
8. ThatPatricio Alburo,Maria Ramoso Sanchez,Roland Pedro Sanchez,Florida MierlySanchez,Alfredo Sanchezand Myrna Sanchezherebywaive,relinquish
and renounce,jointlyand individually,in a manner thatisabsolute and irrevocable,all their rightsand interests, share and participation which they have or might
have in all the properties, both real and personal,known or unknown and/or which maynotbe listed herein,or in excess of the areaslisted or mentioned herein,
and/or which might have been,atone time or another,owned by, registered or placed in the name ofeither of the spouses Juan C. Sanchezor Maria Villafranca de
Sanchezor both,and which either one or both might have sold,ceded,transferred, or donated to anyperson or personsor entity and which partieshereto do
herebyconfirm and ratify together with all the improvementsthereon,as well asall the produce and proceedsthereof,and particularlyofthe properties,real and
personal listed herein,aswell as demandable obligationsdue to the deceased spousesJuan C.Sanchez,before and after the death of the aforementioned spouses
Juan C. Sanchezand Maria Villafranca de Sanchez,in favor ofoppositor Rosalia S. Lugod;
9. Thatthe expenses ofthis litigation including attorney'sfeesshall be borne respectivelyby the partieshereto;
10.That Laureta Tampusfor herself and guardian ad-litem ofher minor children,namely:Florida Mierly,Alfredo,and Myrna,all surnamed Sanchez,herebydeclare
that she hasno right, interest, share and participation whatsoever in the estate leftby Juan C. Sanchezand/or Maria Villafranca de Sanchez,or both,and thatshe
likewise waives, renounces,and relinquisheswhatever rigid,share,participation or interesttherein which she hasor might have in favor of Rosalia S.Lugod;
11.That, the partieshereto mutuallywaive and renounce in favor ofeach other anywhatever claims or actions, arising from, connected with, and asa resultof
Special ProceedingsNos.44-M and 1022 ofthe Courtof First Instance ofMisamis Oriental,Rosalia S. Lugod,warranting thatthe parcel ofland ceded to the other
partiesherein contains48 hectaresand 36 ares.
12.That, Rosalia S. Lugod shall assume asshe herebyassumes the payment to Lugod Enterprises,Inc., of the sum ofP51,598.93 representing the indebtedness
of the estate ofJuan C. Sanchezand Maria Villafranca de Sanchezand the advancesmade to Rolando Pedro,Mierly,Alfredo,and Myna all surnamed Sanchez,
mentioned in paragraphs5 hereto agree to have lettersofadministration issued in favor of Rosalia S. Lugod withoutanybond.
That Rosalia S.Lugod likewise agreesto deliver possession and enjoymentof the parcel ofland herein ceded to petitionersand intervenorsimmediatelyafter the
signing ofthis agreementand thatthe latter also mutuallyagree among themselvesto have the said lot subdivided and partitioned immediatelyin accordance with
the proportion ofone sixth (1/6) partfor every petitioner and intervenor and thatin the meantime that the partition and subdivision isnot yet effected, the
administrationsof said parcel ofland shall be vested jointlywith Laureta Tampos,guardian ad litem ofpetitionersand Maria Ramoso,one of the intervenorswho
shall see to it thateach petitioner and intervenor isgiven one sixth (1/6) ofthe netproceedsofall agricultural harvest made thereon.
WHEREFORE, itis most respectfully prayed thatthe foregoing compromise agreementbe approved.
Medina,Misamis Oriental,October 30,1969.
(Sgd.) (Sgd.)
PATRICIO ALBURO ROSALIA S.LUGOD
Intervenor-Oppositor Oppositor
(Sgd.)
MARIA RAMOSO SANCHEZASSISTEDBY:
Intervenor-Oppositor
(Sgd.)
ASSISTEDBY:PABLO S.REYES
R-101-Navarro Bldg.
(Sgd.) Don A.VelezSt.
REYNALDO L.FERNANDEZ Cagayan de Oro City
Gingoong City
(Sgd.) (Sgd.)
ROLANDO PEDRO T. SANCHEZALFREDO T. SANCHEZ
Petitioner Petitioner
(Sgd.) (Sgd.)
FLORIDA MIERLY T. SANCHEZ MYRNA T. SANCHEZ
Petitioner Petitioner
(Sgd.)
LAURETA TAMPUS
For herselfand as Guardian
Ad-Litem ofthe minors
Florida Mierly,Alfredo,and
Myrna, all surnamed Sanchez
ASSISTEDBY:
TEOGENES VELEZ,JR.
Counsel for Petitioners
Cagayan de Oro City
The Clerk ofCourt
Courtof First Instance
Branch III, Medina,Mis. Or.
Greetings:
Please set the foregoing compromise agreementfor the approval ofthe Honorable Courttoday,Oct. 30, 1969.
(Sgd.) (Sgd.) (Sgd.)
PABLO S.REYES TEOGENES VELEZ,JR.REYNALDO L.FERNANDEZ
The Memorandum ofAgreementdated April 13,1970,which the partiesentered into with the assistance of their counsel,amended the above compromise.(It will be reproduced later in our
discussion ofthe second issue raised bythe petitioners.)
The Court ofAppeals,in a Resolution 10
dated September 4,1992,initiallydismissed private respondents' petition.Acting, however,on a motion for reconsideration and a supplemental
motion for reconsideration dated September 14,1992 and September 25,1992,respectively, 11
RespondentCourtthereafter reinstated private respondents' petition in a resolution 12
dated
October 14,1992.
In due course,the Court ofAppeals,asearlier stated, rendered itsassailed Decision granting the petition,setting aside the trial court'sdecision and declaring the modified compromise
agreementvalid and binding.
Hence, thisappeal to this Courtunder Rule 45 ofthe Rulesof Court.
The Issues
In thisappeal,petitionersinvite the Court'sattention to the following issues:
I
The respondentcourtgrossly erred in granting the petition for certiorari under Rule 65 considering thatthe special civil action of certiorari maynot be availed ofasa
substitute for an appeal and that,in anyevent, the groundsinvoked in the petition are merelyalleged errorsofjudgmentwhich can no longer be done in viewofthe
fact that the decision of the lower court had long become final and executory.
II
Prescinding from the foregoing,the respondentcourterred in annulling the decision ofthe lower courtfor the reason thata compromise agreementor partition as
the court construed the same to be, executed bythe partieson October 30,1969 wasvoid and unenforceable the same nothaving been approved bythe intestate
courtand that the same having been seasonablyrepudiated bypetitionerson the ground offraud.
III
The respondentcourtgrossly erred in ignoring and disregardingfindingsoffactsofthe lower courtthat the alleged conveyancesofreal propertiesmade bythe
spousesJuan C. Sanchezand Maria Villafranca justbefore their death in favor oftheir daughter and grandchildren,private respondentsherein,are tainted with
fraud or made in contemplation ofdeath, hence,collationable.
IV
In anyevent, the respondentcourtgrosslyerred in treating the lower court's declaration offictitiousness of the deedsof sale asa final adjudication ofannulment.
V
The respondentcourtgrossly erred in declaring the termination ofthe intestate proceedingseven asthe lower courthad not made a final and enforceable
distribution of the estate ofthe deceased Juan C.Sanchez.
VI
Prescinding from the foregoing,the respondentcourtgrossly erred in notatleast directing respondentRosalia S.Lugod to deliver the deficiencyof eight(8)
hectaresdue petitionersunder the compromise agreementand memorandum ofagreement,and in notfurther directing her to include in the inventoryproperties
conveyed under the deedsofsale found by the lower court to be partof the estate of Juan C. Sanchez. 13
The salientaspects of some issues are closely intertwined;hence,they are herebyconsolidated into three main issuesspecifically dealing with the following subjects: (1) the proprietyof
certiorari asa remedy before the Courtof Appeals,(2) the validityof the compromise agreement,and (3) the presence of fraud in the execution of the compromise and/or collation ofthe
propertiessold.
The Court's Ruling
The petition is notmeritorious.
First Issue: Proprietyof Certiorari
Before the Courtof Appeals
Since private respondentshad neglected or failed to file an ordinaryappeal within the reglementaryperiod,petitionersallege thatthe CourtofAppealserred in allowing private respondent's
recourse to Rule 65 of the Rules ofCourt. They contend thatprivate respondents' invocation of certiorari was "procedurallydefective." 14
Theyfurther argue that private respondents,in their
petition before the Court ofAppeals,alleged errorsofthe trial court which,being merelyerrorsofjudgmentand noterrors of jurisdiction,were notcorrectable by certiorari.15
This Court
disagrees.
Doctrinally entrenched isthe general rule that certiorari isnota substitute for a lost appeal.However,Justice FlorenzD. Regalado lists several exceptionsto this rule, viz.: "(1) where the
appeal doesnotconstitute a speedyand adequate remedy(Salvadadesvs.Pajarillo,etal.,78 Phil.77), aswhere 33 appealswere involved from ordersissued in a single proceeding which
will inevitably resultin a proliferation ofmore appeals(PCIB vs. Escolin, etal., L-27860 and 27896,Mar.29,1974);(2) where the orderswere also issued either in excess ofor without
jurisdiction (Aguilar vs.Tan, L-23600,Jun 30,1970,Cf. Bautista, et al.vs. Sarmiento,et al., L-45137,Sept.231985);(3) for certain special consideration,aspublicwelfare or publicpolicy
(See Jose vs. Zulueta, etal. 16598,May31, 1961 and the casescited therein);(4) where in criminal actions,the courtrejects rebuttal evidence for the prosecution as, in case ofacquittal,
there could be no remedy(People vs.Abalos,L029039,Nov. 28,1968);(5) where the order isa patentnullity (Marcelo vs. De Guzman, etal., L-29077,June 29,1982);and (6) where the
decision in the certiorari case will avoid future litigations (St.Peter Memorial Park,Inc. vs. Campos, etal., L-38280,Mar.21, 1975)." 16
Even in a case where the remedy ofappeal waslost,
the Court hasissued the writof certiorari where the lower courtpatently acted in excess of or outside its jurisdiction, 17
asin the presentcase.
A petition for certiorari under Rule 65 ofthe Rulesof Courtis appropriate and allowable when the following requisitesconcur:(1) the writisdirected againsta tribunal,board or officer
exercising judicial or quasi-judicial functions;(2) such tribunal,board or officer hasacted without or in excess of jurisdiction,or with grave abuse ofdiscretion amounting to lack or excess of
jurisdiction;and (3) there is no appeal or anyplain,speedyand adequate remedyin the ordinarycourse oflaw. 18
After a thorough reviewofthe case at bar,we are convinced thatall these
requirementswere met.
Asa probate court,the trial courtwas exercising judicial functionswhen it issued its assailed resolution.The said court had jurisdiction to act in the intestate proceedingsinvolved in thiscase
with the caveat that, due to its limited jurisdiction, itcould resolve questions oftitle onlyprovisionally. 19
It ishornbookdoctrine that"in a special proceeding for the probate ofa will,the
question ofownership is an extraneousmatter which the probate courtcannotresolve with finality. This pronouncementno doubtapplieswith equal force to an intestate proceeding asin the
case atbar." 20
In the instant case, the trial courtrendered a decision declaring assimulated and fictitiousall the deedsofabsolute sale which, on July26, 1963 and June 26,1967,Juan C.
Sanchezand Maria Villafranca executed in favor oftheir daughter,Rosalia SanchezLugod;and grandchildren,namely,Arturo S.Lugod,Evelyn S.Lugod and Roberto S.Lugod.The trial
courtruled further that the propertiescovered bythe said salesmust be subject to collation. Citing Article 1409 (2) ofthe Civil Code, the lower courtnullified said deedsof sale and
determined with finality the ownership of the propertiessubjectthereof . In doing so, itclearly overstepped itsjurisdiction as a probate court.Jurisprudence teaches:
[A] probate courtor one in charge ofproceedingswhether testate or intestate cannot adjudicate or determine title to propertiesclaimed to be a part ofthe estate and
which are claimed to belong to outside parties.All that the said court could do asregardssaid propertiesisto determine whether theyshould or should notbe
included in the inventoryor list of propertiesto be administered bythe administrator. If there isnot dispute,well and good,butif there is, then the parties, the
administrator,and the opposing partieshave to resortto an ordinaryaction for a final determination ofthe conflicting claims oftitle because the probate courtcannot
do so. 21
Furthermore,the trial courtcommitted grave abuse ofdiscretion when itrendered itsdecision in disregard ofthe parties' compromise agreement. 22
Such disregard,on the ground thatthe
compromise agreement"wasnor approved bythe court," 23
is tantamountto "an evasion of positive duty or to a virtual refusal to perform the duty enjoined or to actin contemplation and
within the boundsoflaw. " 24
The foregoing issuesclearlyinvolve notonlythe correctness of the trial court's decision butalso the latter'sjurisdiction.They encompassplain errorsofjurisdiction and grave abuse of
discretion, notmerelyerrorsofjudgment. 25
Since the trial court exceeded itsjurisdiction, a petition for certiorari iscertainlya proper remedy.Indeed,itis well-settled that "(a)n actdone bya
probate courtin excess of its jurisdiction maybe corrected by certiorari." 26
Consistent with the foregoing,the following disquisition byrespondentappellate courtisapt:
Asa general proposition,appeal isthe proper remedyofpetitioner Rosalia here under Rule 109 ofthe Revised RulesofCourt.Butthe availabilityofthe ordinary
course of appeal doesnotconstitute sufficient ground to [prevent]a partyfrom making use of the extraordinaryremedyof certiorari where appeal isnotan adequate
remedyor equallybeneficial,speedyand sufficient (Echauzvs. Court ofAppeals,199 SCRA 381).Here,considering that the respondentcourthasdisregarded the
compromise agreementwhich haslong been executed asearlyas October,1969 and declared null and void the deedsofsale with finality, which, asa probate
court, it hasno jurisdiction to do, We deem ordinaryappeal isinadequate.Considering further the [trial court's]granting of[herein petitioners') motion for execution
of the assailed decision, 27
[herein private respondent]Rosalia'sresortto the instant petition [for reviewon certiorari]is all the more warranted under the
circumstances. 28
We thus hold thatthe questioned decision and resolutionsofthe trial courtmay be challenged through a special civil action for certiorari under Rule 65 ofthe Rules ofCourt. At the very
least, this case is a clear exception to the general rule that certiorari isnota substitute for a lost appeal because the trial court'sdecision and resolutionswere issued without or in excess of
jurisdiction,which maythus be challenged or attacked atany time. "A void judgmentfor want ofjurisdiction is no judgmentatall. It cannotbe the source of anyrightnor the creator ofany
obligation.All acts performed pursuantto itand all claims emanating from it have no legal effect. Hence, itcan never become final and anywritof execution based on itis void; ' .. . itmay be
said to be a lawlessthing which can be treated as an outlawand slain atsight, or ignored wherever and whenever itexhibits its head.' " 29
Second Issue: Validityof Compromise Agreement
Petitionerscontend that, because the compromise agreementwasexecuted during the pendencyofthe probate proceedings,judicial approval isnecessaryto shroud it with validity. They
stress that the probate courthad jurisdiction over the propertiescovered bysaid agreement.Theyadd that PetitionersFlorida Mierly,Alfredo and Myrna were all minersrepresented onlyby
their mother/natural guardian,Laureta Tampus. 30
These contentions lackmerit. Article 2028 of the Civil Code definesa compromise agreementas"a contract wherebythe parties, bymaking reciprocal concessions, avoid a litigation or put
an end to one alreadycommenced." Being a consensual contract, it isperfected upon the meeting ofthe minds ofthe parties. Judicial approval isnotrequired for its perfection. 31
Petitioners'
argumentthatthe compromise was notvalid for lack of judicial approval isnotnovel;the same wasraised in Mayuga vs. Courtof Appeals,32
where the Court, through Justice Irene R.
Cortes, ruled:
It is alleged thatthe lack ofjudicial approval isfatal to the compromise. A compromise is a consensual contract. As such, itis perfected upon the meeting of the
mindsof the partiesto the contract. (Hernandezv.Barcelon,23 Phil.599 [1912];see also De losReyes v. de Ugarte, 75 Phil.505 [1945].) And from that moment
notonly doesitbecome binding upon the parties(De losReyes v. De Ugarte, supra ),it also hasupon them the effect and authorityof resjudicata (Civil Code,Art.
2037),even ifnot judiciallyapproved (Menesesv.De la Rosa,77 Phil. 34 [1946];Vda.De Guilasv.David, 132 Phil.241,L-24280,23 SCRA 762 [May27, 1968];
Cochingyan v. Cloribel,L-27070-71 [April 22,1977],76 SCRA 361).(Emphasisfound in the original.)
In the case before us, it isineludible thatthe partiesknowinglyand freely entered into a valid compromise agreement.Adequatelyassisted by their respective counsels, they each negotiated
its terms and provisionsfor four months; in fact, said agreementwasexecuted onlyafter the fourth draft. Asnoted by the trial court itself, the first and second drafts were prepared
successively in July, 1969;the third draft on September 25,1969;and the fourth draft, which was finallysigned bythe partieson October 30,1969,33
followed. Since thiscompromise
agreementwasthe resultofa long drawn outprocess,with all the parties ablystriving to protect their respective interests and to come outwith the best theycould, there can be no doubt
that the partiesentered into it freelyand voluntarily.Accordingly, theyshould be bound thereby. 34
To be valid, itis merelyrequired under the lawto be based on real claimsand actually
agreed upon in good faith bythe partiesthereto. 35
Indeed,compromise is a form ofamicable settlement that isnot onlyallowed butalso encouraged in civil cases. 36
Article 2029 ofthe Civil Code mandatesthat a "court shall endeavor to
persuade the litigantsin a civil case to agree upon some fair compromise."
In opposing the validityand enforcementofthe compromise agreement,petitionersharp on the minorityof Florida Mierly,Alfredo and Myna.Citing Article 2032 ofthe Civil Code,they
contend that the court'sapproval isnecessary in compromises entered into byguardiansand parentsin behalfoftheir wardsor children. 37
However, we observe that although denominated a compromise agreement,the documentin thiscase is essentially a deed ofpartition,pursuantto Article 1082 ofthe Civil Code which
providesthat "[e]very act which is intended to putan end to indivision among co-heirsand legateesor deviseesisdeemed to be a partition, although itshould purportto be a sale,an
exchange,a compromise, or anyother transaction."
For a partition to be valid,Section 1, Rule 74 of the Rulesof Court, requiresthe concurrence ofthe following conditions:(1) the decedentleftno will; (2) the decedentleft no debts, or ifthere
were debtsleft, all had been paid;(3) the heirsand liquidatorsare all ofage,or iftheyare minors, the latter are represented bytheir judicial guardian or legal representatives;and (4) the
partition was made bymeansof a publicinstrumentor affidavit duly filed with the Register of Deeds. 38
We find that all the foregoing requisitesare presentin thiscase. We therefore affirm
the validity of the parties' compromise agreement/partition in thiscase.
In anyevent, petitionersneither raised nor ventilated thisissue in the trial court. This newquestion or matter was manifestly beyond the pale ofthe issuesor questions submitted and
threshed outbefore the lower court which are reproduced below, viz.:
I Are the propertieswhich are the objectof the sale by the deceased spousesto their grandchildren collationable?
II Are the propertieswhich are the object ofthe sale bythe deceased spousesto their legitimate daughter also collationable?
III The first and second issues being resolved,howmuch then is the rightful share of the four (4) recognized illegitimate children? 39
Furthermore,the 27-page Memorandum dated February17,1990 filed bypetitionersbefore the Regional Trial Court 40
readilyrevealsthattheynever questioned the validity ofthe
compromise. In their comment before the Court ofAppeals, 41
petitionersbased their objection to sad compromise agreementon the solitary"reason that itwas tainted with fraud and
deception," zeroing specifically on the alleged fraud committed by private respondentRosalia S.Lugod. 42
The issue of minoritywas first raised onlyin petitioners' Motion for Reconsideration
of the Courtof Appeals' Decision; 43
thus, it "isas ifit was never dulyraised in thatcourt at all." 44
Hence, this Courtcannotnow, for the first time on appeal,entertain this issue,for to do so
would plainlyviolate the basic rule offair play, justice and due process. 45
We take this opportunityto reiterate and emphasize the well-settled rule that"(a)n issue raised for the first time on
appeal and notraised timelyin the proceedingsin the lower courtis barred byestoppel.Questions raised on appeal mustbe within the issues framed bythe parties and,consequently,
issues notraised in the trial courtcannotbe raised for the first time on appeal." 46
The petitionerslikewise assail as void the provision on waiver contained in No. 8 ofthe aforequoted compromise,because itallegedlyconstitutes a relinquishmentbypetitionersof"a rightto
propertieswhich were notknown." 47
They argue thatsuch waiver iscontrary to law, publicpolicy, moralsor good custom. The Courtdisagrees.The assailed waiver pertained to their
hereditaryrightto propertiesbelonging to the decedent'sestate which were not included in the inventoryofthe estate'sproperties.It also covered their rightto other propertiesoriginally
belonging to the spouses Juan Sanchezand Maria Villafranca de Sanchezwhich have been transferred to other persons.In addition,the parties agreed in the compromise to confirm and
ratify said transfers. The waiver isvalid because, contraryto petitioners' protestation,the parties waived a known and existing interest — their hereditaryrightwhich was alreadyvested in
them by reason ofthe death oftheir father. Article 777 ofthe Civil Code providesthat "(t)he rightsto the succession are transmitted from the momentof death ofthe decedent." Hence,there
is no legal obstacle to an heir'swaiver ofhis/her hereditaryshare "even ifthe actual extentof such share isnotdetermined until the subsequentliquidation ofthe estate." 48
Atanyrate, such
waiver is consistent with the intentand letter ofthe law advocating compromise asa vehicle for the settlement ofcivil disputes. 49
Finally, petitionerscontend thatPrivate RespondentRosalia T.Lugod'salleged fraudulentacts,specifically her concealment ofsome ofthe decedent'sproperties,attended the actual
execution of the compromise agreement. 50
This argumentisdebunked bythe absence of anysubstantial and convincing evidence on record showing fraud on her part.Asaptlyobserved by
the appellate court:
[Herein petitioners] accuse [herein private respondent]Rosalia offraud or deception by alleging, inter alia,thatthe parcel of land given to them never conformed to
the stated area,i.e., forty-eight (48) hectares,as stated in the compromise agreement.We find this argumentunconvincing and unmeritorious.[Herein petitioners']
avermentof fraud on the partof [herein private respondent]Rosalia becomesuntenable when We consider the memorandum ofagreementtheylater executed with
[herein private respondent]Rosalia wherein said compromise agreementwasmodified bycorrecting the actual area given to [herein petitioners]from forty-eight(48)
hectaresto thirty-six (36) hectaresonly. If the actual area allotted to them did not conform to the 48 hectare area stated in the compromise agreement,then why did
they agree to the memorandum ofagreementwherebytheir share in the estate of their father waseven reduced to just 36 hectares? Where isfraud or deception
there? Considering that[herein petitioners]were ablyrepresented bytheir lawyersin executing these documents and who presumablyhad explained to them the
importand consequencesthereof,it is hard to believe their charge thatthey were defrauded and deceived by[herein private respondent]Rosalia.
If the parcel of land given to [herein petitioners], when actuallysurveyed, happened to be differentin area to the stated area of48 hectaresin the compromise
agreement,this circumstance isnot enough proofoffraud or deception on [herein private respondent]Rosalia'spart.Note thatTax Declaration No. 06453 plainly
discloses thatthe land transferred to [herein petitioners]pursuantto the compromise agreementcontained an area of48 hectares(Annex"A",Supplemental Reply).
And when [herein petitioners]discovered thatthe land allotted to them actuallycontained only24 hectares, a conference between the partiestook place which led to
the execution and signing ofthe memorandum ofagreementwherein [herein petitioners']distributive share waseven reduced to 36 hectares.In the absence of
convincing and clear evidence to the contrary, the allegation offraud and deception cannotbe successfully imputed to [herein private respondent]Rosalia who must
be presumed to have acted in good faith. 51
The memorandum ofagreementfreelyand validlyentered into bythe partieson April 13,1970 and referred to above reads:
MEMORANDUM OFAGREEMENT
The partiesassisted by their respective counsel have agreed astheyherebyagree:
1. To amend the compromise agreementexecuted bythem on October 30,1969 so as to include the following:
a. Correction ofthe actual area being given to the petitionersand intervenors,all illegitimate children ofthe late Juan C. Sanchez, forty-
eight(48) hectares,thirty-six (36) aresasembodied in the aforementioned compromise agreementto thirty-six(36) hectaresonly, thus
enabling each ofthem to getsix (6) hectareseach.
b. Thatthe said 36-hectare area shall be taken from thatparcel of land which isnow covered byO.C.T. No. 146 (Patent No.30012) and
the adjoining areasthereofdesignated asLotA and LotCas reflected on the sketch plan attached to the record ofthis case prepared by
GeodeticEngineer Olegario E.Zallespursuantto the Court'scommission of March 10,1970 provided,however,that ifthe said 36-hectare
area could notbe found after adding thereto the areasofsaid lotsA and C,then the additional area shall be taken from whatis designated
asLot B,likewise also reflected in the said sketch plan attached to the records;
c. That the partition among the six illegitimate children ofthe late Juan C. Sanchez(petitionersand intervenors) shall be effective among
themselves in such a manner to be agreed upon bythem,each undertaking to assume redemption ofwhatever plants found in their
respective shareswhich need redemption from the tenants thereofaswell as the continuity ofthe tenancyagreementsnowexisting and
covering the said shares or areas.
d. The subdivision surveyshall be at the expense of the said petitionersand intervenorsprorata.
e. Thatthe administratrix agreesto deliver temporaryadministration ofthe area designated asLot5 ofthe VallesSketch Plan pending final
survey ofthe said 36-hectare area.
Cagayan de Oro City, April 13,1970.
(Sgd.)
LAURETA TAMPOS
For herselfand as Guardian
ad-litem of Rolando,Mierly,
Alfredo and Myrna,all
surnamed Sanchez
Assisted by:
(Sgd.)
TEOGENES VELEZ,Jr.
Counsel for Petitioners
(Sgd.)
ROSALIA S.LUGOD
Administratrix
Assisted by:
(Sgd.)
PABLO S.REYES
Counsel for Administratrix
(Sgd.)
MARIA RABOSO SANCHEZ
Intervenor 52
Not onlydid the partiesknowinglyenter into a valid compromise agreement;they even amended itwhen theyrealized some errorsin the original.Such correction emphasizesthe
voluntariness of said deed.
It is also significant thatall the parties,including the then minors, had already consummated and availed themselvesofthe benefits oftheir compromise.53
This Courthas consistently ruled
that "a partyto a compromise cannot askfor a rescission after it hasenjoyed its benefits." 54
Bytheir acts, the partiesare ineludiblyestopped from questioning the validityof their
compromise agreement.Bolstering thisconclusion is the fact thatpetitionersquestioned the compromise only nine yearsafter its execution, when theyfiled with the trial courttheir Motion to
Defer Approval ofCompromise Agreement,dated October 26,1979. 55
In hindsight,it is notat all farfetched that petitionersfiled said motion for the sole reason that theymay have felt
shortchanged in their compromise agreementor partition with private respondents,which in their viewwas unwise and unfair. While we maysympathize with this rueful sentimentof
petitioners,we can onlystress thatthis alone isnotsufficient to nullify or disregard the legal effectsof said compromise which, by its verynature asa perfected contract, is binding on the
parties. Moreover,courtshave no jurisdiction to lookinto the wisdom of a compromise or to render a decision differenttherefrom.56
It isa well-entrenched doctrine that"the law doesnot
relieve a partyfrom the effects of an unwise,foolish, or disastrouscontract, entered into with all the required formalitiesand with full awarenessofwhat he wasdoing" 57
and "a compromise
entered into and carried outin good faith will notbe discarded even if there wasa mistake oflawor fact, (McCarthy vs. Barber Steamship Lines,45 Phil.488) because courtshave no power
to relieve partiesfrom obligationsvoluntarilyassumed,simply because their contracts turned outto be disastrousdealsor unwise investments." 58
Volenti non fitinjuria.
Corollarily,the petitionerscontend that the Court ofAppealsgravelyabused its discretion in deeming Special ProceedingsNos.44-M and 1022 "CLOSEDand TERMINATED," arguing that
there was asyet no order ofdistribution ofthe estate pursuantto Rule 90 of the Rulesof Court. Theyadd that theyhad not received their full share thereto. 59
We disagree.Under Section 1,
Rule 90 of the Rulesof Court, an order for the distribution ofthe estate may be made when the "debts, funeral charges,and expensesof administration,the allowance to the widow,and
inheritance tax, ifany," had been paid.Thisorder for the distribution of the estate's residue mustcontain the namesand sharesof the personsentitled thereto.A perusal ofthe whole record,
particularlythe trial court'sconclusion, 60
revealsthatall the foregoing requirementsalreadyconcurred in thiscase.The paymentof the indebtednessofthe estates ofJuan C. Sanchezand
Maria Villafranca in the amountofP51,598.93 was shouldered byPrivate RespondentRosalia,who also absorbed or charged againsther share the advancesofRolando T.Lugod in the
sum ofP8,533.94,in compliance with Article 1061 ofthe Civil Code on collation. 61
Furthermore,the compromise of the parties, which is the lawbetween them, alreadycontainsthe names
and sharesofthe heirsto the residual estate,which shareshad also been delivered.On thispoint,we agree with the following discussion of the Court ofAppeals:
Butwhat the (trial court) obviouslyoverlooked in itsappreciation ofthe facts of thiscase are the uncontroverted facts that (herein petitioners) have been in
possession and ownership oftheir respective distributive shares asearlyas October 30,1969 and theyhave received other propertiesin addition to their distributive
sharesin consideration ofthe compromise agreementwhich theynow assail.Proofs thereofare TaxDeclarationsNo. 20984,20985,20986,20987,20988,20989
and 20990 (Annexes"B" to "H", Supplemental Reply) in the respective namesof (herein petitioners),all for the year 1972.(Herein petitioners) also retained a house
and lot, a residential lotand a parcel ofagricultural land (Annexes"I","J" and "K",Ibid.) all ofwhich were notconsidered in the compromise agreementbetween the
parties. Moreover,in the compromise agreement per se,it is undoubtedlystated therein thatcash advancesin the aggregate sum of P8,533.94 were received by
(herein petitioners) after October 21,1968 (Compromise Agreement,par.5) 62
All the foregoing showclearlythat the probate courthad essentially finished said intestate proceedingswhich,consequently,should be deemed closed and terminated.In view ofthe above
discussion, the Court seesno reversible error on the partofthe Courtof Appeals.
Third Issue: Fraud and Collation
Petitionersfault RespondentCourtfor not ordering Private RespondentRosalia T.Lugod to deliver to them the deficiency as allegedlyprovided under the compromise agreement.They
further contend that said court erred in notdirecting the provisional inclusion ofthe alleged deficiencyin the inventoryfor purposesofcollating the propertiessubject ofthe questioned deeds
of sale.63
We see no such error.In the trial court, there was onlyone hearing conducted,and itwasheld onlyfor the reception ofthe evidence ofRosalia S. Lugod to install her as
administratrixof the estate of Maria Villafranca.There wasno other evidence,whether testimonial or otherwise,"received, formallyoffered to, and subsequentlyadmitted by the probate
courtbelow"; nor wasthere "a trial on the merits ofthe parries' conflicting claims." 64
In fact, the petitioners"moved for the defermentof the compromise agreementon the basisof alleged
fraudulentconcealmentofproperties — NOTbecause of anydeficiency in the land conveyed to them under the agreements." 65
Hence, there isno hard evidence on record to backup
petitioners' claims.
In anycase, the trial court noted Private RespondentRosalia'swillingnessto reimburse anydeficiency actuallyproven to exist. It subsequentlyordered the geodeticengineer who prepared
the certification and the sketch ofthe lot in question,and who could have provided evidence for the petitioners,"to bring recordsofhis relocation survey." 66
However,GeodeticEngineer
Idulsa did not complywith the court's subpoena ducestecum and ad testificandum. Neither did he furnish the required relocation survey. 67
No wonder,even after a thorough scrutinyofthe
records,this Court cannotfind anyevidence to supportpetitioners' allegationsoffraud againstPrivate RespondentRosalia.
Similarly,petitioners' allegationsoffraud in the execution ofthe questioned deedsofsale are bereft ofsubstance, in view ofthe palpable absence ofevidence to supportthem.The legal
presumption ofvalidity ofthe questioned deedsofabsolute sale,being dulynotarized publicdocuments,hasnot been overcome.68
On the other hand,fraud is notpresumed.It must be
proved byclear and convincing evidence,and notby mere conjecturesor speculations. We stress that these deedsof sale did notinvolve gratuitoustransfers of future inheritance;these
were contracts of sale perfected by the decedentsduring their lifetime. 69
Hence,the propertiesconveyed therebyare notcollationable because,essentially,collation mandated under Article
1061 ofthe Civil Code contemplates propertiesconveyed inter vivosby the decedentto an heir bywayof donation or other gratuitoustitle.
In anyevent, these alleged errorsand deficienciesregarding the deliveryofsharesprovided in the compromise,concealment ofpropertiesand fraud in the deedsofsale are factual in nature
which, asa rule, are notreviewable bythisCourt in petitionsunder Rule 45. 70
Petitionershave failed to convince us thatthis case constitutes an exception to such rule. All in all,we find that
the Court ofAppealshassufficiently addressed the issuesraised bythem. Indeed,they have notpersuaded usthat said Courtcommitted anyreversible error to warranta grantof their
petition.
WHEREFORE, the petition is herebyDENIEDand the assailed Decision ofthe CourtofAppealsis AFFIRMED.
SO ORDERED.
GRACE J. GARCIA, a.k.a. GRACE J. GARCIA-RECIO, petitioner, vs. REDERICK A. RECIO, respondent.
D E CI S I O N
PANGANIBAN, J.:
A divorce obtained abroad byan alien maybe recognized in our jurisdiction,provided such decree isvalid according to the national lawofthe foreigner. However,the divorce decree and
the governing personal lawofthe alien spouse who obtained the divorce must be proven. Our courts do nottake judicial notice offoreign lawsand judgments; hence,like anyother facts,
both the divorce decree and the national lawofthe alien must be alleged and proven according to our lawon evidence.
The Case
Before usis a Petition for Review under Rule 45 ofthe Rules ofCourt, seeking to nullifythe January7, 1999 Decision and the March 24,1999 Order ofthe Regional Trial Courtof
Cabanatuan City, Branch 28,in Civil Case No. 3026–AF. The assailed Decision disposed as follows:
“WHEREFORE, thisCourt declaresthe marriage between Grace J.Garcia and RederickA.Recio solemnized on January12,1994 atCabanatuan Cityas dissolved and both partiescan
nowremarryunder existing and applicable lawsto anyand/or both parties.”
The assailed Order denied reconsideration ofthe above-quoted Decision.
The Facts
RederickA. Recio, a Filipino,wasmarried to Editha Samson,an Australian citizen,in Malabon,Rizal, on March 1, 1987.Theylived together as husband and wife in Australia. On May18,
1989,a decree ofdivorce, purportedlydissolving the marriage,wasissued by an Australian familycourt.
On June 26,1992,respondentbecame an Australian citizen,as shown bya “Certificate ofAustralian Citizenship” issued by the Australian government.Petitioner -- a Filipina -- and
respondentwere married on January12,1994 in Our LadyofPerpetual Help Church in Cabanatuan City.In their application for a marriage license,respondentwasdeclared as“single” and
“Filipino.”
Starting October 22,1995,petitioner and respondentlived separatelywithoutprior judicial dissolution oftheir marriage. While the two were still in Australia,their conjugal assets were
divided on May16, 1996,in accordance with their Statutory Declarationssecured in Australia.
On March 3, 1998,petitioner filed a Complaintfor Declaration of Nullityof Marriage in the court a quo,on the ground ofbigamy -- respondentallegedlyhad a prior subsisting marriage atthe
time he married her on January12,1994. She claimed thatshe learned ofrespondent’smarriage to Editha Samson onlyin November,1997.
In hisAnswer,respondentaverred that,as far back as1993,he had revealed to petitioner hisprior marriage and itssubsequentdissolution.He contended that hisfirst marriage to an
Australian citizen had been validlydissolved by a divorce decree obtained in Australia in 1989;thus,he waslegallycapacitated to marry petitioner in 1994.
On July 7,1998 -- or aboutfive years after the couple’swedding and while the suitfor the declaration ofnullitywas pending -- respondentwasable to secure a divorce decree from a family
courtin Sydney,Australia because the “marriage ha[d]irretrievablybroken down.”
Respondentprayed in hisAnswer that the Complaintbe dismissed on the ground thatit stated no cause ofaction. The Office ofthe Solicitor General agreed with respondent.The court
marked and admitted the documentary evidence ofboth parties. After they submitted their respective memoranda,the case wassubmitted for resolution.
Thereafter,the trial court rendered the assailed Decision and Order.
Ruling ofthe Trial Court
The trial court declared the marriage dissolved on the ground thatthe divorce issued in Australia was valid and recognized in the Philippines. Itdeemed the marriage ended,butnoton the
basisof anydefect in an essential elementof the marriage;that is, respondent’salleged lackoflegal capacityto remarry. Rather, it based its Decision on the divorce decree obtained by
respondent. The Australian divorce had ended the marriage;thus,there was no more marital union to nullifyor annul.
Hence, thisPetition.
Issues
Petitioner submits the following issues for our consideration:
“1
The trial court gravelyerred in finding thatthe divorce decree obtained in Australia bythe respondent ipso facto terminated hisfirst marriage to Editha Samson therebycapacitating him to
contract a second marriage with the petitioner.
“2
The failure of the respondent,who isnow a naturalized Australian,to presenta certificate of legal capacityto marryconstitutes absence ofa substantial requisite voiding the petitioner’s
marriage to the respondent
“3
The trial court seriouslyerred in the application ofArt. 26 ofthe FamilyCode in thiscase.
“4
The trial court patentlyand grievouslyerred in disregarding Arts.11,13,21, 35,40,52 and 53 ofthe Family Code asthe applicable provisionsin thiscase.
“5
The trial court gravelyerred in pronouncing thatthe divorce decree obtained bythe respondentin Australia ipso facto capacitated the partiesto remarry, withoutfirst securing a recognition of
the judgmentgranting the divorce decree before our courts.”
The Petition raises five issues, but for purposesof thisDecision, we shall concentrate on two pivotal ones:(1) whether the divorce between respondentand Editha Samson wasproven,and
(2) whether respondentwasproven to be legallycapacitated to marrypetitioner. Because ofour ruling on these two, there isno more necessity to take up the rest.
The Court’s Ruling
The Petition is partlymeritorious.
First Issue:
Proving the Divorce Between Respondentand Editha Samson
Petitioner assailsthe trial court’s recognition ofthe divorce between respondentand Editha Samson. Citing Adong v.Cheong Seng Gee, petitioner arguesthatthe divorce decree,like any
other foreign judgment,maybe given recognition in this jurisdiction onlyupon proofofthe existence of(1) the foreign law allowing absolute divorce and (2) the alleged divorce decree itself.
She addsthatrespondentmiserablyfailed to establish these elements.
Petitioner addsthat, based on the first paragraph ofArticle 26 ofthe Family Code,marriagessolemnized abroad are governed bythe lawofthe place where they were celebrated (the lex
loci celebrationis). In effect, the Code requiresthe presentation ofthe foreign lawto show the conformity of the marriage in question to the legal requirementsofthe place where the
marriage wasperformed.
At the outset, we lay the following basiclegal principlesasthe take-off pointsfor our discussion. Philippine lawdoesnotprovide for absolute divorce;hence,our courts cannotgrantit. A
marriage between two Filipinoscannotbe dissolved even by a divorce obtained abroad,because ofArticles15 and 17 ofthe Civil Code. In mixed marriagesinvolving a Filipino and a
foreigner,Article 26 ofthe Family Code allowsthe former to contract a subsequentmarriage in case the divorce is “validly obtained abroad bythe alien spouse capacitating him or her to
remarry.” A divorce obtained abroad bya couple,who are both aliens,may be recognized in the Philippines,provided itisconsistent with their respective national laws.
A comparison between marriage and divorce,asfar as pleading and proofare concerned,can be made. Van Dorn v.Romillo Jr. decreesthat“aliensmay obtain divorcesabroad,which may
be recognized in the Philippines,provided theyare valid according to their national law.” Therefore,before a foreign divorce decree can be recognized byour courts,the party pleading it
must prove the divorce as a fact and demonstrate its conformity to the foreign lawallowing it. Presentation solelyofthe divorce decree isinsufficient.
Divorce as a Question of Fact
Petitioner insists that before a divorce decree can be admitted in evidence,it must first comply with the registration requirementsunder Articles11,13 and 52 ofthe Family Code. These
articles read asfollows:
“ART. 11. Where a marriage license isrequired,each ofthe contracting partiesshall file separatelya sworn application for such license with the proper local civil registrar which shall specify
the following:
x xx x x x x x x
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101844369 civil-law-cases

  • 1. Homework Help https://www.homeworkping.com/ Research Paper help https://www.homeworkping.com/ Online Tutoring https://www.homeworkping.com/ click here for freelancing tutoring sites G.R. No. L-38230 November 21,1933 THE PEOPLE OFTHE PHILIPPINE ISLANDS, plaintiff-appellee, vs. BITDU, defendant-appellant. VICKERS, J.: Thisis an appeal from the following decision of Judge A.Horilleno in the Courtof First Instance ofZamboanga: There isno dispute between the prosecution and the defense asto the fact Mora Bitdu was married to Moro Halid before an Imam in Lamitan of this Province of Zamboanga in accordance with Mohammedan ritesmore than twelve yearsago,and that aboutseven months ago she wasalso married to Moro Hajirol before a Hadji in accordance with Mohammedan customs. It is therefore a fact admitted by both the prosecution and the defense that the accused contracted two marriages, one with Halid and another with Hajirol.She claims, however,that the second marriage contracted by her with Hajirol took place after she had been divorced from her first husband Halid in accordance with Mohammedan customs, said divorce having taken place before Datu Gavino Cuevas,of Isabela de Basilan. With this defense, two very importantquestionsare raised before this court:first whether or notthe alleged divorce tookplace in accordance with Mohammedan customs, and second,assuming that the divorce tookplace in accordance with such customs, is such divorce legal? With reference to the first question, two witnesses testified, one for the prosecution and the other for the defense.The first witness testified that the divorce between Mohammedansin Mindanao maybe obtained before anyperson designated and agreed upon bythe parties.The second testified that divorce,like anyother act relative to marriage and separation ofMohammedan spouses,isobtained under certain conditions, to wit, the interested partiesor the spouses intending to secure a divorce select the person before whom the divorce is to take place,and both partiesare represented bypersonsdesignated bythem: Chapter IV, section 35 of the Koran says: "35.And if you fear a breach between the two, then appointa judge from his people and judge from her people;iftheyboth desire agreement,Allah will effect harmonybetween them; surelyAllah isknowing;Aware." The court isinclined to believe that the testimony of the witness for the defense on this question ismore in harmonywith the doctrinesof the Koran than thatof the witness for the prosecution. Now, hasthe defense established that the divorce took place in accordance with the commandments ofthe Koran? The defense presented no evidence to showthat the conditionsprescribed bythe Koran had been complied with bythe partieswhen they obtained their divorce before Datu Cuevas. Said divorce therefore between the defendant and Halid doesnotsatisfy the conditionsprescribed bythe Koran and consequentlysaid divorce seemsto be of doubtful religiousvalidity. However, even admitting that thisdivorce was secured in accordance with the conditionsprescribed byMohammedan doctrines,is such divorce legal? The laws governing marriage and itsincidentsare moral in nature and assuch theyare laws relating to publicpolicy. In the Philippine Islandswe have a law (ActNo. 2710) enumerating the causes and the conditionsunder which divorce may be secured and granted.Anydivorce obtained in the Philippine Islandsofcausesand under conditionsother than those enumerated in said law,would have no legal effect. The habitsand customs of a people,the dogmasand doctrinesofa religion cannotbe superior to or have precedence over laws relating to publicpolicy,because as stated above lawsrelating to marriage and itsincidentsare normal in nature and assuch they affect publicpolicy. The court therefore is of the opinion thateven ifthe divorce alleged bythe defense wassecured in conformity with Mohammedan doctrines,such divorce cannotprevail againstthe Divorce Lawof the Philippine Islandsprescribing the causesand conditionsunder which divorce may be obtained.In this case, as above demonstrated,the divorce in question hasnot been obtained in accordance with the law. Examined from whatever angle,the divorce alleged bythe defense cannotbe accepted bythis court for the reasonsabove set forth. In view of the foregoing facts and considerations,we cannotescape the conclusion thatthe defendantherein contracted a second marriage withouther former marriage having been firstdissolved.
  • 2. In the consideration ofthis case, however,the court cannotbuttake into account thatthe defendantisa Mohammedan woman;and being a follower ofMohammedan doctrinesshe no doubtcontracted the second marriage honestlybelieving thatin doing so she was notcommitting any violation ofthe law, although ofcourse her beliefdoesnot justify her act. In view of the foregoing,and itappearing thatthe defendantisonlyseventeen years ofage and therefore in the opinion of the courtit would be more convenientfor her to be sent to the Philippine Training School in Mandaluyong,Manila,(Rizal),itisordered thatthe accused be sent to said institution, to be kept there until she reachesthe age of majority, all the proceedingsin thiscase being herebysuspended. The attorney for the defendantallegesthatthe lower courterred in finding thatthe accused committed the crime ofbigamy, and in ordering her to be sentto the Philippine Training School in Mandaluyong,Rizal. Appellant'sattorneyadmitsthat the appellantwastwice married asalleged in the information,butcontends thatshe wasdivorced from first husband in accordance with Mohammedan religiouspractices, and thatsaid divorce was valid;that if it be true thatsaid divorce isnot in accordance with Act No. 2710 ofthe Philippine Legislature,the appellantisneverthelessnot guiltyof bigamy, because she believed thatshe had been validlydivorced and had no criminal intentwhen contracted the second marriage. The Solicitor-General agreeswith the attorneyfor the appellant,and isof the opinion thatthe divorce wasgranted in accordance with the precepts of the Koran and Moro customsand traditions; thatfraudulentor criminal intentis an essential elementof the crime ofbigamy, and thatsince the appellantbelieved thather firstmarriage had been legallydissolved because she had been granted a divorce under the Mohammedan laws,she cannotbe considered guiltyofthe crime with which she is charged. The Solicitor-General further arguesthatsince itis the practice ofthe Governmentnotto interfere with the customs of the Moros, especiallytheir religiouscustoms, divorces among them granted in accordance with the Koran oughtto be recognized asa matter ofpublicpolicy. There islittle to add to the well considered decision ofthe trial judge.It seems to us unnecessaryto determine whether or notthe divorce in question wasgranted in accordance with the Mohammedan religiouspractices,as to which there seems to exist considerable uncertainty,because in our viewof the case a valid divorce can be granted onlybythe courts and for the reasonsspecified in Act No. 2710.It is notclaimed that the appellantwasdivorced from her first husband in accordance with said Act.lawphil.net In the case of Francisco vs. Tayao (50 Phil.,42), itwas held thatin the Philippinesthe causesfor divorce are prescribed bystatute or Act No. 2710 and that ofthe wife or concubinage on the partof the husband. In the recentdecision of People vs.Bituanan (Moro),(56 Phil.,23),where the defendantand a Moro woman were married bya datu according to Moro customs and usagesand afterwards divorced bythe datu according to the same customs and usages,it washeld that the marriage performed according to the ritesof the Mohammedan religion wasvalid,and assumed, for the purpose ofthat case, that the defendantand hiswife were notlegallydivorced. Section 25 ofthe Marriage Law(ActNo. 3613) providesthatmarriagesbetween Mohammedansmaybe performed in accordance with the rites or practice of their religion,butthere is no provision oflaw which authorizesthe granting ofdivorces in accordance with the ritesor practices of their religion. A divorce cannotbe had except in thatcourt upon which the state hasconferred jurisdiction, and then onlyfor those causes and with those formalitieswhich the state hasby statute prescribed (19 C.J., 19). It is conceded in all jurisdictionsthatpublicpolicy, good morals,and the interests of society require thatthe marriage relation should be sounded with everysafeguard and its severance allowed onlyin the manner prescribed and for the causesspecified bylaw. And the parties can waive nothing essential to the validity of the proceedings(19 C.J., 20). With respect to the contention that the appellantacted in good faith in contracting second marriage,believing thatshe had been validlydivorced from her first husband,itis sufficient to say thatevery one ispresumed to know the law, and the fact that one doesnotknowthat is act constitutes a violation of the lawdoesnot exempthim from the consequencesthereof.The case ofthe United States vs. Enriquez(32 Phil.,202),cited bythe Solicitor-General isnotin point.In that case the defendantlefthis wife in the municipalityof Orion,Province ofBataan,in the year 1895,going to the Province ofLaguna asa postal employee.When he returned in 1901,after the revolution,he could not find hiswife or obtain the slightest information asto her whereaboutsnotwithstanding hispersistent and diligentsearch.Believing her to be dead,he contracted a second marriage in Orion on February1st,1905.In December, 1913,hisfirst wife made her appearance in Orion.She had been in Manila,Tarlac,and Victoria from 1895 to 1913.The defendantwasacquitted on appeal to thiscourtbecause no fraudulentintentcould be charged to him. He believed thathis first wife was dead,and thatwas a well-founded belief,although itwas subsequentlyto be erroneous.It wasa mistake offact and notof law. The decisionsof American courts, cited by the Solicitor- General,sustaining the validityof divorcesgranted to members ofIndian tribesaccording to the customs and usagesthereof, are likewise not in point.The variousIndian tribes in the United States were dealtwith bythe Governmentofthe United States as independentnationsand treatieswere made with them. Asto the suggestion of the Solicitor-General thatdivorcesamong the Morosaccording to their religiouspracticesshould be recognized asvalid as a matter of publicpolicy, because in the contrary case, "there would be no end ofcriminal prosecutions,for polygamystill aboundsamong them,and the remarriagesofpeople divorced under the Koran are the order ofthe day," thatis a matter for the consideration ofthe Legislature and the Governor-General. The decision appealed from isaffirmed, with the costs againstthe appellant. Street, Malcolm,Abad Santos,and Butte, JJ., concur. G.R. No. L-15645 January 31,1964 PAZ P.ARRIETA andVITALIADO ARRIETA, plaintiffs-appellees, vs. NATIONAL RICE AND CORNCORPORATION, defendant-appellant, MANILA UNDERWRITERS INSURANCE CO., INC., defendant-appellee. REGALA, J.: This isan appeal ofthe defendant-appellantNARICfrom the decision ofthe trial courtdated February20,1958,awarding to the plaintiffs-appelleesthe amountof $286,000.00 asdamages for breach of contract and dismissing the counterclaim and third party complaintofthe defendant-appellantNARIC. In accordance with Section 13 of RepublicActNo. 3452,"the National Rice and Corn Administration (NARIC) is herebyabolished and all itsassets, liabilities,functions, powerswhich are not inconsistent with the provisionsofthis Act, and all personnel are transferred "to the Rice and Corn Administration (RCA). All references,therefore, to the NARIC in thisdecision must accordinglybe adjusted and read asRCA pursuantto the aforementioned law. On May19, 1952,plaintiff-appellee participated in the publicbidding called bythe NARICfor the supplyof20,000 metric tonsof Burmese rice.As her bid of$203.00 per metricton was the lowest, she was awarded the contract for the same. Accordingly, on July1, 1952,plaintiff-appellee PazP.Arrieta and the appellantcorporation entered into a ContractofSale ofRice,under the terms of which the former obligated herselfto deliver to the latter 20,000 metrictons of BurmessRice at $203.00 per metricton, CIF Manila.In turn,the defendantcorporation committed itself to payfor the imported rice "bymeansof an irrevocable,confirmed and assignable letter ofcredit in U.S. currencyin favor ofthe plaintiff-appellee and/or supplier in Burma, immediately." Despite the commitment to pay immediately"bymeans ofan irrevocable,confirmed and assignable Letter ofCredit," however,it was onlyon July30, 1952,or a full month from the execution of the contract, that the defendantcorporation,thru its general manager,tookthe first to open a letter ofcredit byforwarding to the Philippine National BankitsApplication for Commercial Letter Credit. The application wasaccompanied bya transmittal letter, the relevantparagraphsofwhich read: In viewof the fact that we do not have sufficient depositwith your institution with which to cover the amountrequired to be deposited asa condition for the opening ofletters of credit, we will appreciate it ifthis application could be considered special case. We understand thatour supplier,Mrs. PazP. Arrieta,hasa deadline to meetwhich isAugust 4,1952,and in order to comply therewith, it isimperative that the L/C be opened prior to that date.We would therefore requestyour full cooperation on thismatter. On the same day,July 30,1952,Mrs. PazP. Arrieta thru counsel,advised the appellantcorporation ofthe extreme necessity for the immediate opening ofthe letter creditsince she had by then made a tender to her supplier in Rangoon,Burma,"equivalentto 5% ofthe F.O.B. price of20,000 tons at$180.70 and in compliance with the regulationsin Rangoon this5% will be confiscated if the required letter ofcreditis notreceived by them before August4, 1952."
  • 3. On August4, 1952,the Philippine National Bankinformed the appellantcorporation thatitsapplication,"for a letter of creditfor $3,614,000.00 in favor of Thiri Setkya hasbeen approved by the Board ofDirectors with the condition that marginal cash depositbe paid and thatdrafts are to be paid upon presentment." (Exh.J-pl.; Exh. 10-def.,p. 19,Folder ofExhibits). Furthermore, the Bankrepresented thatit "will hold your application in abeyance pending compliance with the above stated requirement." Asit turned out, however,the appellantcorporation notin anyfinancial position to meet the condition.As matter of fact, in a letter dated August2, 1952,the NARIC bluntlyconfessed to the appellee itsdilemma:"In this connection,please be advised thatour application for opening ofthe letter of credithas been presented to the banksince July 30th butthe latter requiresthat we first deposit50% ofthe value of the letter amounting to aproximately$3,614,000.00 which we are notin a position to meet." (Emphasissupplied.Exh.9-Def.; Exh. 1-Pe.,p. 18,Folder of Exhibits) Consequently,the creditinstrument applied for wasopened onlyon September 8,1952 "in favor ofThiri Setkya, Rangoon,Burma,and/or assignee for $3,614,000.00," (which ismore than two monthsfrom the execution of the contract) the partynamed bythe appellee asbeneficiaryofthe letter of credit.1äwphï1.ñët Asa resultof the delay,the allocation ofappellee'ssupplier in Rangoon wascancelled and the 5% deposit,amounting to 524,000 kyatsor approximatelyP200,000.00 wasforfeited.In this connection,it must be made ofrecord that although the Burmese authoritieshad setAugust4, 1952,asthe deadline for the remittance ofthe required letter ofcredit,the cancellation ofthe allocation and the confiscation ofthe 5% depositwere not effected until August20,1952,or, a full half month after the expiration ofthe deadline.And yet, even with the 15-daygrace, appellantcorporation wasunable to make good itscommitment to open the disputed letter of credit. The appellee endeavored,butfailed,to restore the cancelled Burmese rice allocation.When the futility of reinstating the same became apparent,she offered to substitute Thailand rice instead to the defendantNARIC, communicating at the same time that the offer was "a solution which should be beneficial to the NARIC and to usat the same time." (Exh.X-Pe., Exh.25— Def., p.38,Folder of Exhibits).This offer for substitution, however, was rejected by the appellantin a resolution dated November 15,1952. On the foregoing,the appellee senta letter to the appellant,demanding compensation for the damagescaused her in the sum of $286,000.00,U.S. currency,representing unrealized profit. The demand having been rejected she instituted this case nowon appeal. At the instance of the NARIC, a counterclaim was filed and the Manila UnderwritersInsurance Companywas broughtto the suit asa third partydefendantto hold it liable on the performance bond itexecuted in favor of the plaintiff-appellee. We find for the appellee. It is clear upon the recordsthatthe sole and principal reason for the cancellation ofthe allocation contracted by the appellee herein in Rangoon,Burma,wasthe failure of the letter ofcredit to be opened with the contemplated period.Thisfailure must, therefore,be taken asthe immediate cause for the consequentdamage which resulted.Asit isthen, the disposition ofthis case dependson a determination ofwho wasresponsible for such failure.Stated differently, the issue is whether appellant'sfailure to open immediatelythe letter ofcredit in dispute amounted to a breach ofthe contract ofJuly 1,1952 for which itmay be held liable in damages. Appellantcorporation disclaimsresponsibilityfor the delayin the opening ofthe letter of credit.On the contrary,it insists that the fault lieswith the appellee.Appellantcontendsthatthe disputed negotiable instrumentwasnot promptlysecured because the appellee ,failed to seasonablyfurnish data necessary and required for opening the same,namely,"(1) the amountof the letter ofcredit, (2) the person,company or corporation in whose favor it isto be opened,and (3) the place and bankwhere itmaybe negotiated." Appellantwould have thisCourtbelieve, therefore,that had these informationsbeen forthwith furnished it, there would have been no delayin securing the instrument. Appellant'sexplanation hasneither force nor merit.In the first place,the explanation reachesinto an area ofthe proceedingsinto which We are notatliberty to encroach.The explanation refersto a question of fact. Nothing in the record suggestsanyarbitraryor abusive conduct on the partof the trial judge in the formulation ofthe ruling.His conclusion on the matter is sufficiently borne outbythe evidence presented.We are denied,therefore,the prerogative to disturb that finding,consonantto the time-honored tradition ofthisTribunal to hold trial judges better situated to make conclusionson questionsof fact. For the record,We quote hereunder the lower court'sruling on the point: The defense that the delay, ifany in opening the letter ofcreditwas due to the failure ofplaintiff to name the supplier, the amountand the bankisnot tenable.Plaintiffstated in Courtthat these facts were known to defendanteven before the contract wasexecuted because these facts were necessarily revealed to the defendantbefore she could qualify asa bidder.She stated too that she had given the necessary data immediatelyafter the execution of Exh."A" (the contract ofJuly 1, 1952) to Mr.GABRIEL BELMONTE, General Manager ofthe NARIC, both orallyand in writing and thatshe also pressed for the opening ofthe letter ofcredit on these occasions. These statements have notbeen controverted and defendantNARIC, notwithstanding its previousintention to do so,failed to presentMr. Belmonte to testify or refute this. ... Secondly,from the correspondence and communicationswhich form partof the record of thiscase, it is clear thatwhat singularlydelayed the opening ofthe stipulated letter of creditand which, in turn,caused the cancellation ofthe allocation in Burma,wasthe inability ofthe appellantcorporation to meetthe condition importation bythe Bankfor granting the same. We do not think the appellantcorporation can refute the fact that had itbeen able to putup the 50% marginal cash depositdemanded by the bank,then the letter of creditwould have been approved, opened and released asearlyasAugust4,1952.The letter of the Philippine National Bankto the NARIC was plain and explicitthatas ofthe said date,appellant's"application for a letter of credit... hasbeen approved bythe Board ofDirectorswith the condition that 50% marginal cash depositbe paid and thatdrafts are to be paid upon presentment." (Emphasissupplied) The liabilityof the appellant,however,stems notalone from this failure or inabilityto satisfy the requirementsofthe bank.Its culpability arisesfrom its willful and deliberate assumption of contractual obligationseven asit was well aware ofits financial incapacity to undertake the prestation. We base this judgmentupon the letter which accompanied the application filed bythe appellantwith the bank, a partof which letter wasquoted earlier in thisdecision.In the said accompanying correspondence,appellant admitted and owned thatitdid "nothave sufficient depositwith your institution (the PNB) with which to cover the amountrequired to be deposited asa condition for the opening ofletters ofcredit. ... . A number oflogical inferencesmay be drawn from the aforementioned admission.First, that the appellantknewthe bankrequirementsfor opening lettersofcredit; second,that appellant also knew itcould not meetthose requirement.When,therefore,despite thisawarenessthat was financiallyincompetentto open a letter ofcredit immediately, appellantagreed in paragraph 8 of the contract to payimmediately"by meansofan irrevocable,confirm and assignable letter ofcredit," it must be similarlyheld to have bound itself to answer for all and every consequencesthat would resultfrom the representation.aptlyobserved bythe trial court: ... Having called for bidsfor the importation ofrice involving millions,$4,260,000.00 to be exact, it should have a certained itsability and capacityto comply with the inevitably requirementsin cash to payfor such importation.Having announced the bid,it must be deemed to have impliedlyassured suppliersofits capacity and facility to finance the importation within the required period,especiallysince ithad imposed the supplier the 90-dayperiod within which the shipmentofthe rice must be broughtinto the Philippines. Having entered in the contract, it should have taken steps immediately to arrange for the letter of creditfor the large amountinvolved and inquired into the possibilityofits issuance. In relation to the aforequoted observation ofthe trial court, We would like to make reference also to Article 11 of the Civil Code which provides: Those who in the performance oftheir obligation are guiltyoffraud, negligence,or delay,and those who in anymanner contravene the tenor thereof,are liable in damages. Under this provision,notonlydebtorsguilty offraud, negligence or defaultin the performance ofobligationsa decreed liable;in general,everydebtor who failsin performance ofhis obligationsisbound to indemnifyfor the losses and damagescaused thereby(De la Cruz SeminaryofManila, 18 Phil.330;Municipalityof Moncada v.Cajuigan,21 Phil.184;De la Cavada v. Diaz, 37 Phil.982;Maluenda & Co.v. Enriquez,46 Phil.916;Pasumil v. Chong,49 Phil.1003;Pando v. Gimenez,54 Phil. 459;Acme Films v. Theaters Supply,63 Phil.657).The phrase "anymanner contravene the tenor" of the obligation includesanyillicitact which impairsthe strict and faithful fulfillmentof the obligation or everykind or defective performance.(IV Tolentino, Civil Code ofthe Philippines,citing authorities, p.103.) The NARIC would also have this Court hold thatthe subsequentoffer to substitute Thailand rice for the originallycontracted Burmese rice amounted to a waiver by the appellee ofwhatever rightsshe mighthave derived from the breach ofthe contract. We disagree.Waiversare notpresumed,butmust be clearlyand convincinglyshown,either by expressstipulation or acts admitting no other reasonable explanation.(Ramirezv.Court ofAppeals,52 O.G. 779.) In the case at bar,no such intent to waive hasbeen established. We have carefully examined and studied the oral and documentaryevidence presented in thiscase and upon which the lower courtbased its award.Under the contract, the NARIC bound itself to buy20,000 metric tons of Burmese rice at"$203.00 U.S. Dollarsper metricton, all net shipped weight,and all in U.S. currency,C.I.F. Manila ..." On the other hand,documentaryand other evidence establish with equal certaintythat the plaintiff-appellee wasable to secure the contracted commodity at the cost price of $180.70 per metricton from her supplier in Burma. Considering freights,insurance and chargesincidentto its shipmenthere and the forfeiture of the 5% deposit, the award granted bythe lower court isfair and equitable.For a clearer viewof the equity ofthe damagesawarded,We reproduce belowthe testimonyofthe appellee,adequatelysupported bythe evidence and record:
  • 4. Q.Will you please tell the court, howmuch isthe damage you suffered? A. Because the selling price ofmy rice is $203.00 per metricton, and the cost price ofmy rice is $180.00 We had to payalso $6.25 for shipping and about$164 for insurance. So adding the cost ofthe rice,the freight, the insurance, the total would be about$187.99 thatwould be $15.01 grossprofitper metricton, multiply by20,000 equals$300,200, that ismy supposed profitif I wentthrough the contract. The above testimony of the plaintiff wasa general approximation ofthe actual figuresinvolved in the transaction. A precise and more exactdemonstration of the equity ofthe award herein is provided byExhibitHH ofthe plaintiffand Exhibit34 of the defendant,hereunder quoted so far asgermane. It is equallyofrecord nowthat asshown in her requestdated July 29,1959,and other communicationssubsequentthereto for the opening byyour corporation ofthe required letter of credit, Mrs. Arrieta wassupposed to payher supplier in Burma atthe rate of One Hundred EightyDollarsand SeventyCents($180.70) in U.S.Currency, per ton plus EightDollars($8.00) in the same currencyper ton for shipping and other handling expenses,so thatshe isalreadyassured ofa net profitof Fourteen Dollarsand ThirtyCents ($14.30),U.S., Currency, per ton or a total ofTwo Hundred and EightySixThousand Dollars($286,000.00),U.S.Currency, in the aforesaid transaction. ... Lastly, herein appellantfiled a counterclaim asserting thatit hassuffered, likewise byway ofunrealized profitdamagesin the total sum of $406,000.00 from the failure ofthe projected contract to materialize.Thiscounterclaim wassupported bya cost study made and submitted bythe appellantitselfand wherein itwas illustrated howindeed had the importation pushed thru, NARIC would have realized in profitthe amountasserted in the counterclaim.And yet, the said amountofP406,000.00 wasrealizable byappellantdespite a number ofexpenseswhich the appellee under the contract,did not have to incur. Thus,under the cost study submitted bythe appellant,banking and unloading chargeswere to be shoulderedbyit,including an Import License Fee of 2% and superintendence fee of$0.25 per metricton.If the NARIC stood to profit over P400 000.00 from the disputed transaction inspite of the extra expendituresfrom which the herein appellee wasexempt,we are convicted of the fairnessof the judgmentpresentlyunder appeal. In the premises, however,a minor modification must be effected in the dispositive portion ofthe decision appeal from insofar asit expressesthe amountofdamagesin U.S. currencyand not in Philippine Peso.RepublicAct529 specificallyrequiresthe discharge ofobligationsonly"in any coin or currencywhich at the time of paymentislegal tender for publicand private debts." In viewof thatlaw, therefore,the award should be converted into and expressed in Philippine Peso. This bringsusto a consideration ofwhatrate of exchange should applyin the conversion here decreed.Should itbe atthe time ofthe breach,at the time the obligation wasincurred or atthe rate of exchange prevailing on the promulgation ofthisdecision. In the case of Engel v.Velasco & Co., 47 Phil.115,We ruled thatin an action for recovery ofdamagesfor breach ofcontract, even if the obligation assumed bythe defendantwasto paythe plaintiff a sum of moneyexpressed in American currency, the indemnityto be allowed should be expressed in Philippine currencyatthe rate ofexchange atthe time of the judgmentrather than at the rate of exchange prevailing on the date ofdefendant'sbreach.Thisruling,however,can neither be applied nor extended to the case at bar for the same waslaid down when there was no lawagainststipulating foreign currenciesin Philippine contracts.But nowwe have RepublicAct No. 529 which expresslydeclaressuch stipulationsas contraryto publicpolicy, void and ofno effect. And,as We alreadypronounced in the case of Eastboard Navigation,Ltd. v. Juan Ysmael & Co., Inc., G.R. No. L-9090,September 10,1957,ifthere isanyagreement to payan obligation in a currencyother than Philippine legal tender,the same isnull and void ascontraryto publicpolicy (RepublicAct529),and the most that could be demanded isto pay said obligation in Philippine currency"to be measured in the prevailing rate ofexchange atthe time the obligation wasincurred (Sec.1,idem)." UPONALL THE FOREGOING, the decision appealed from isherebyaffirmed, with the sole modification that the award should be converted into the Philippine peso atthe rate of exchange prevailing atthe time the obligation wasincurred or on July1, 1952 when the contractwas executed. The appellee insurance company,in the lightofthis judgment,is relieved of anyliability under thissuit. No pronouncementasto costs. G.R. No. 108947 September29,1997 ROLANDO SANCHEZ, FLORIDA MIERLY SANCHEZ, ALFREDO T. SANCHEZ and MYRNAT. SANCHEZ, petitioners, vs. THE HONORABLE COURT OF APPEALS,ROSALIA S. LUGOD,ARTURO S.LUGOD, EVELYNLUGOD-RANISES and ROBERTO S. LUGOD, respondents. PANGANIBAN, J.: Is a petition for certiorari,in lieu ofappeal,the proper remedyto correct ordersofa probate courtnullifying certain deedsof sale and,thus, effectively passing upon title to the properties subject ofsuch deeds? Isa compromise agreementpartitioning inherited propertiesvalid even withoutthe approval ofthe trial courthearing the intestate estate ofthe deceased owner? The Case These questionsare answered bythis Court asit resolvesthe petition for reviewon certiorari before usassailing the November 23, 1992 Decision1 of the Courtof Appeals2 in CA-G.R.SP No. 28761 which annulled the decision3 ofthe trial court4 and which declared the compromise agreement among the partiesvalid and binding even withoutthe said trial court's approval. The dispositive portion ofthe assailed Decision reads: WHEREFORE, for the reasonshereinabove setforth and discussed,the instantpetition is GRANTEDand the challenged decision aswell asthe subsequentorders of the respondentcourtare ANNULLEDand SETASIDE.The temporary restraining order issued bythisCourton October 14, 1992 ismade PERMANENT.The compromise agreementdated October 30,1969 asmodified bythe memorandum ofagreementofApril 13,1970 isDECLAREDvalid and binding upon herein parties. And Special ProceedingsNo.44-M and 1022 are deemed CLOSEDand TERMINATED. SO ORDERED.5 The AntecedentFacts The facts are narrated bythe Courtof Appealsas follows: [Herein private respondent]Rosalia S. Lugod isthe onlychild of spousesJuan C. Sanchezand Maria Villafranca while [herein private respondents]Arturo S.Lugod, Evelyn L. Ranisesand Roberto S.Lugod are the legitimate children of[herein private respondent]Rosalia. [Herein petitioners] Rolando,Florida Mierly,Alfredo and Myrna,all surnamed Sanchez,are the illegitimate children ofJuan C. Sanchez. Following the death of her mother,Maria Villafranca,on September 29,1967,[herein private respondent]Rosalia filed on January22,1968,thru counsel,a petition for letters of administration over the estate ofher mother and the estate of her father,Juan C. Sanchez, who was atthe time in state of senility(Annex"B", Petition). On September 30,1968,[herein private respondent]Rosalia,asadministratrix ofthe intestate estate of her mother,submitted an inventory and appraisal ofthe real and personal estate ofher late mother (Annex"C",Petition). Before the administration proceedingsSpecial in ProceedingsNo.44-M could formallybe terminated and closed,Juan C. Sanchez,[herein private respondent] Rosalia'sfather, died on October 21,1968. On January14,1969,[herein petitioners]as heirsofJuan C. Sanchez,filed a petition for letters of administration (Special ProceedingsNo.1022) over the intestate estate ofJuan C. Sanchez, which petition was opposed by(herein private respondent) Rosalia.6 On October 30,1969,however,[herein private respondent]Rosalia and [herein petitioners] assisted bytheir respective counselsexecuted a compromise agreement(Annex"D",Petition) wherein theyagreed to divide the propertiesenumerated therein ofthe late Juan C. Sanchez. On November 3,1969,petitioner Rosalia was appointed by[the trial court], and tookher oath as the administratrixof her father'sintestate estate. On January19,1970,[herein petitioners]filed a motion to require administratrix,[herein private respondent]Rosalia,to deliver deficiencyof 24 hectaresand or to set aside compromise agreement(Annex"E",Petition). Under date ofApril 13,1970,(herein private respondent) Rosalia and [herein petitioners]entered into and executed a memorandum ofagreementwhich modified the compromise agreement(Annex"F".Petition)
  • 5. On October 25,1979,or nine yearslater, [herein petitioners]filed,thru counsel,a motion to require [herein private respondent] Rosalia to submita newinventory and to render an accounting over propertiesnotincluded in the compromise agreement(Annex"G", Petition).Theylikewise filed a motion to defer the approval of the compromise agreement(Annex"H", Ibid),in which theyprayed for the annulmentofthe compromise agreementon the ground offraud. On February4,1980,however,counsel for [herein petitioners]moved to withdrawhisappearance and the two motions he flied,Annex"G" and "H" (Annex"I", Petition). On February28,1980,the [trial] court issued an order directing [herein private respondent]Rosalia to submita new inventoryofpropertiesunder her administration and an accounting ofthe fruits thereof,which prompted [herein private respondent]Rosalia to file a rejoinder on March 31, 1980 (Annex"K",Petition). On May12, 1980,[herein petitioners],thru new counsel,filed a motion to change administratrix(Annex"L",Petition) to which [herein private respondent]Rosalia filed an opposition (Annex"M", Ibid). The partieswere subsequentlyordered to submit their respective position papers, which they did (Annexes"N" and "O",Petition).On September 14,1989,former counsel of (herein petitioners) entered hisre-appearance ascounsel for (herein petitioners). On the bases ofmemoranda submitted bythe parties,the [trial court], thistime presided byJudge Vivencio A.Galon,promulgated itsdecision on June 26,1991, the dispositive portion ofwhich states: WHEREFORE, premisesconsidered,judgmentisherebyrendered asfollowsbydeclaring and ordering: 1. Thatthe entire intestate estate of Maria Villafranca Sanchezunder Special Proceedings No.44-M consistsof all her paraphernal propertiesand one-half(1/2) ofthe conjugal propertieswhich mustbe divided equallybetween Rosalia Sanchezde Lugod and Juan C. Sanchez; 2. Thatthe entire intestate estate of Juan C. Sanchezunder Special ProceedingsNo.1022 consistsofall hiscapital properties,one-half (1/2) from the conjugal partnership ofgainsand one-half(1/2) ofthe intestate estate of Maria Villafranca under Special ProceedingsNo. 44-M; 3. Thatone-half(1/2) ofthe entire intestate estate of Juan C. Sanchezshall be inherited byhisonlylegitimate daughter,Rosalia V. Sanchezde Lugod while the other one-half(1/2) shall be inherited and be divided equallyby,between and among the six(6) illegitimate children,namely:Patricia Alburo,Maria Ramuso Sanchez, Rolando Pedro T.Sanchez,Florida MierlyT. Sanchez,Alfredo T.Sanchezand Myrna T. Sanchez; 4. Thatall the Deed (sic) of Absolute Salesexecuted byJuan C. Sanchezand Maria Villafranca in favor ofRosalia SanchezLugod,Arturo S. Lugod,Evelyn S.Lugod and Roberto S.Lugod on July26,1963 and June 26,1967 are all declared simulated and fictitiousand mustbe subject to collation and partition among all heirs; 5. Thatwithin thirty (30) daysfrom finality of thisdecision, Rosalia SanchezLugod isherebyordered to prepare a projectofpartition ofthe intestate estate ofJuan C. Sanchezunder Special ProceedingsNo.1022 and distribute and deliver to all heirstheir corresponding shares. If she fails to do so within the said thirty (30) days, then a Board ofCommissionersis herebyconstituted, who are all entitled to honorarium and per diemsand other necessaryexpenseschargeable to the estate to be paid byAdministratrixRosalia S. Lugod,appointing the Community Environmentand Natural ResourcesOfficer (CENRO) ofGingoog Cityas membersthereof, with the task to prepare the projectof partition and deliver to all heirstheir respective shares within ninety(90) days from the finality of said decision; 6. Thatwithin thirty (30) daysfrom receipt ofthis decision,Administratrix Rosalia SanchezVda.de Lugod isherebyordered to submittwo (2) separate certified true and correct accounting,one for the income ofall the propertiesofthe entire intestate estate ofMaria Villafranca under Special ProceedingsNo.44-M,and another for the propertiesofthe entire intestate estate of Juan C. Sanchezunder Special ProceedingsNo.1022 dulyboth signed byher and both verified bya Certified PublicAccountantand distribute and deliver to her six (6) illegitimate brothersand sisters in equal shares,one-half(1/2) ofthe net income ofthe estate ofJuan C. Sanchezfrom October 21,1968 up to the finality ofthis decision; 7. For failure to render an accounting reportand failure to give cash advancesto the illegitimate children ofJuan C. Sanchezduring their minorityand hour ofneed from the netincome of the estate ofJuan C. Sanchez,which adverselyprejudiced their social standing and pursuitof college education,(the trial court) herebyordersRosalia SanchezVda.de Lugod to payher six(6) illegitimate brothersand sisters the sum of Five Hundred Thousand (P500,000.00) Pesos,asexemplarydamages,and also the sum of One Hundred Fifty Thousand (P150,000.00) Pesosfor attorney'sfees; 8. Upon release ofthisdecision and during itspendency,should appeal be made,the Register of Deedsand Assessors ofthe Provinces and Cities where the propertiesofJuan C. Sanchezand Maria Villafranca are located,are all ordered to register and annotate in the title and/or tax declarations,the dispositive portion ofthis decision for the protection of all heirsand all those who may be concerned. SO ORDERED. [Herein private respondent]Rosalia filed a motion for reconsideration dated July17,1991 (Annex"P",Petition) on August6, 1991. On August13,1991,[herein petitioners]filed a motion for execution and opposition to [herein private respondent]Rosalia's motion for reconsideration (Annex"Q", Petition). On September 3,1991,[the trial court] issued an OmnibusOrder (Annex"S",Petition) declaring,among other things,thatthe decision at issue had become final and executory. [Herein private respondent]Rosalia then filed a motion for reconsideration ofsaid OmnibusOrder (Annex"T",Petition).Said [herein private respondent]was allowed to file a memorandum in supportofher motion (Annex"V",Petition). On June 26,1991,[the trial court] issued and Order denying petitioner Rosalia'smotion for reconsideration (Annex"W",Petition).7 Thereafter,private respondentselevated the case to the Courtof Appealsvia a petition for certiorari and contended: I The [trial court] hasno authorityto disturb the compromise agreement. II The [trial court] hasarbitrarilyfaulted [herein private respondent]Rosalia S.Lugod for alleged failure to render an accounting which wasimpossible. III The [trial court] acted without jurisdiction in derogation ofthe constitutional rights of[herein private respondents]Arturo S. Lugod,Evelyn L.Ranisesand Roberto S. Lugod when [the trial court] decided to annul the deed ofsale between the said [herein private respondents]and Juan C.Sanchezwithout affording them their day in court. IV [The trial courtjudge]defied without rhyme or reason well-established and entrenched jurisprudence when he determined factssansanyevidence thereon. V [The trial court] grosslymisinterpreted [herein private respondent]Rosalia S.Lugod'srightto appeal.8 For clarity's sake, this Courtherebyreproducesverbatim the compromise agreement9 of the parties: COMPROMISE AGREEMENT
  • 6. COME NOW, the partiesin the above-entitled case,motivated bytheir mutual desire to preserve and maintain harmoniousrelationsbetween and among themselves, for mutual valuable considerationsand in the spiritofgood will and fair play, and,for the purpose ofthisCompromise Agreement,agree to the following: 1. Thatthe deceased Juan C. Sanchezwho died intestate on October 21,1968 waslegallymarried to Maria Villafranca de Sanchez,who predeceased her on September 29,1967,outof whose wedlockRosalia SanchezLugod,Oppositor herein,wasborn,thus making her the sole and only surviving legitimate heir of her deceased parents; 2. Thatthe said deceased Juan C.Sanchez, leftillegitimate children,Intervenors-Oppositorsand Petitioners,respectively, herein namely; (1) Patricio Alburo,born outofwedlock on March 17,1926 atCebu City, Philippines,to Emilia Alburo; (2) Maria Ramoso Sanchez,born outof wedlockon May 9,1937 at Gingoog,MisamisOriental,now,Gingoog City, to Alberta Ramoso; (3) (a) Rolando Pedro Sanchez,born on May19,1947, (b) Florida MierlySanchez,born on February16,1949, (c) Alfredo Sanchez,born on July21, 1950,and (d) Myrna Sanchez,born on June 16,1952, all born outof wedlockto Laureta Tampusin Gingoog City, Philippines. 3. Thatthe deceased Juan C. Sanchezleft the following properties,to wit: I. SEPARATE CAPITAL OFJUAN C. SANCHEZ NATURE, DESCRIPTION AND AREA ASSESSEDVALUE (1) Agricultural Land.Covered byTax. Decl. No.06458,Cad. LotNo. 1041 C-2,located at Murallon,Gingoog Cityand bounded on the North byLotNos. 1033, 1035,1036,1037,1039,1040,1042 & 1043;South byLotNo. 1080,1088,1087 & 1084;EastbyLotNos. 1089,1061 & 2319;West byLot Nos. 954,1038,1057 & 1056,containing an area ofONE HUNDRED EIGHTY THREE THOUSAND SIX HUNDRED SEVENTY TWO (183,672) sq. ms. more or less. P21,690.00 II. CONJUGAL PROPERTY OFJUAN C. SANCHEZAND MARIA VILLAFRANCA DE SANCHEZ (1) Agricultural Land.Covered byTaxDecl. No. 06447,Cad.Lot No.2745,C-7 located atAgay-ayan,Gingoog Cityand bounded on the North byLotNos. 2744, 2742,2748;South byLotNo. 2739;East byLot No.2746;West by LotNo. 2741,containing an area ofFOURTEENTHOUSAND SEVENHUNDRED (14,700) sq. ms. more or less. P1,900.00 (2) Agricultural Land.Covered byTaxDecl. No. 06449,Cad,Lot No.3271 C-7 located at Panyangan,Lanao,Gingoog Cityand bounded on the North byLotNo. 3270;South byLot Nos. 2900 & 3462;EastbyPanyangan River & F. Lumanao;and PartofLot3272;and West bySamayCreek, containing an area ofONE HUNDRED FOUR THOUSAND SIX HUNDRED (104,600) sq.ms. more or less. P11,580.00 (3) Agricultural Land.Covered byTaxDecl. No. 06449,Cad.Lot No.2319,Case 2,located at Murallon,Gingoog Cityand bounded on the North byLotNo. 1061; South byHinopolan Creek;East byLot No.1044;and West byLot No.1041,containing an area ofTHREE THOUSANDTWO HUNDRED TWENTY FIVE (3,225) sq. ms. more or less. (4) Agricultural Land.Covered byTaxDecl. No. 06452,Cad.Lot No.3272,C-7 Part 4 located atPanyangan,Lunao,Gingoog Cityand bounded on the North byLot Nos. 3270 & 3273;Eastby Panyangan River;South byPanyangan River;and Westby LotNos. 3270 & 3271,containing an area ofFIFTY FIVE THOUSAND SIX HUNDRED (55,600) sq. ms. more or less, being claimed byDamian Querubin. P2,370.00 (5) Agricultural Land.Covered byTaxDecl. No. 06453,Cad.Lot No.3270 Case 7, located at Sunog,Lunao,Gingoog Cityand bounded on the North bySamay Creek& Lot 3267;South byLotNos. 3271 & 3272;East byLotNos. 3269 & 3273;and West bySamayCreek, containing an area of FOURHUNDRED EIGHT THREE THOUSANDSIX HUNDRED (483,600) sq.ms. more or less. P61,680.00 (6) Agricultural Land.Covered byTaxDecl. No. 06457,Cad.Lot No.3273,C-7 Part 2 located atPanyangan,Lunao,Gingoog Cityand bounded on the North byLot No. 3269;South byLotNo. 3272;East byPanyangan River;and Westby LotNo. 3270,containing an area ofTHIRTY FOUR THOUSANDTHREE HUNDRED (34,300) sq.ms. more or less, being claimed byMiguel Tuto. P3,880.00 (7) Agricultural Land.Covered byTaxDecl. No. 12000,Cad.Lot No.2806,Case 7 located at Agayayan,Gingoog Cityand bounded on the North byAgayayan River; South byVictoriano Barbac;Eastby Isabelo Ramoso; and Westby Restituto Baol,containing an area ofSIX THOUSAND SIX HUNDRED SEVENTY SIX (6,676) sq.ms. more or less. P380.00 (8) Agricultural Land.Covered byTaxDecl. No. 12924,Cad.Lot No.1206 C-1 located at Cahulogan,Gingoog Cityand bounded on the NW.,byLotNo. 1209;SW., byLot No. 1207;EastbyNational Highway; and West byLotNo. 1207;containing an area ofFOURTHOUSAND FIVE HUNDRED THIRTEEN (4,513) sq. ms. more or less. P740.00 (9) Agricultural Land.Covered byTaxDecl. No. 12925,Cad.Lot No.5554,located at Tinaytayan, Pigsalohan,Gingoog Cityand bounded on the North byLotNos. 5559 & 5558;South byLotNo. 3486;Eastby LotNo. 5555;and West byLotNo. 5355,containing an area ofEIGHTEENTHOUSAND FIVE HUNDRED TWENTY EIGHT (18,528) sq.ms. more or less. P320.00 (10) Agricultural Land.Covered byTaxDecl. No. 12926,Cad.LotNo. 5555 C-7 located at Tinaytayan,Pigsalojan,Gingoog Cityand bounded on the North by Tinaytayan Creek & LotNos. 5557 & 5558;South byLotNos. 3486,3487,3488,3491 & 3496;EastbyCr. & LotNo. 3496;and West byLotNo. 5554,containing an area ofSEVENTY SEVENTHOUSANDSEVENHUNDRED SEVENTY SIX (77,776) sq.ms. more or less. P1,350.00 (11) A Commercial Land.Covered byTax Decl. No. 06454,Cad.LotNo. 61-C-1 located atGuno-Condeza Sts., Gingoog Cityand bounded on the North byLot64; South byRoad-Lot613 Condeza St; Eastby LotNos. 63,and 62;West by Road-Lot614-Guno St.,containing an area ofONE THOUSANDFORTY TWO (1,042) sq. ms. more or less. P9,320.00 (12) A Commercial Land.Covered byTax Decl. No. 06484,LotNo. 5,Block 2,located at Cabuyoan,Gingoog Cityand bounded on the North byLotNo. 4,block 2; South byLot No.8, block2; East byLotNo. 6, block2, West bySubdivision Road,containing an area ofFOURHUNDRED (400) sq.ms. more or less. P12,240.00
  • 7. (13) A Commercial Land.Covered byTax Decl. No. 15798,BlockNo. 7-A-16-0 located atCabuyoan,Gingoog Cityand bounded on the North byLotNo. 7-A-16-0; South byLot No.7-16-0;East byLotNo. 7-A-18-Road;Westby LotNo. 8,PSU-120704-Julito Arengo vs.Restituto Baol,containing an area ofTWO HUNDRED SIXTEEN(216) sq.ms. more or less. P1,050.00 (14) Agricultural Land.Covered byTax,Decl. No. 06789,Cad.Lot No. 5157-C-7,located atKiogat,Agayayan,Gingoog Cityand bounded on the North byLotNo. 5158,5159,5156;South bySE-Steep Bank;Eastby NW, byLot No.5158,Villafranca,containing an area ofNINETY SIX THOUSAND TWO HUNDRED (96,200) sq. ms. more or less. P3,370.00 III. PERSONAL ESTATE (CONJUGAL) NATURE ANDDESCRIPTION LOCATION APPRAISAL 1. Fifty (50) sharesof stock Rural BankofGingoog,Inc. at P100.00 per share P5,000.00 2. Four (4) sharesofPreferred Stock with San Miguel Corporation 400.00 4. That, the partieshereto have agreed to divide the above-enumerated propertiesin the following manner,to wit: (a) To Patricio Alburo,Maria Ramoso Sanchez, Roland Pedro T.Sanchez,Florida MierlySanchez,Alfredo T. Sanchezand Myrna T. Sanchez,in equal pro-indiviso shares,considering notonlytheir respective areasbutalso the improvements existing thereon,to wit: Agricultural Land.Covered byTaxDecl. No. 06453,Cad.Lot No.3270 Case 7, located at Sunog,Lunao, Gingoog Cityand bounded on the North bySamayCreek& Lot 3267;South byLotNos. 3271 and 3272;Eastby LotNos. 3269 & 3273;and West bySamayCreek, containing an area ofFOURHUNDRED EIGHTY THREE THOUSAND SIX HUNDRED (483,600) sq.ms. and assessed in the sum of P61,680.00. (b) To Rosalia SanchezLugod all the rest ofthe properties,both real and personal,enumerated above with the exception of the following: (1) Two Preferred SharesofStockin the San Miguel Corporation,indicated in San Miguel Corporation StockCertificate No. 30217,which two sharesshe is ceding in favor of Patricio Alburo; (2) The house and lotdesignated asLotNo. 5, Block2 together with the improvements thereon and identified asparcel No.II-12, lot covered byTax Decl. No.15798 identified asParcel No. II-13 in the above enumerated,and Cad.LotNo. 5157-C-7 together with the improvements thereon,which is identified asparcel No.II-14 of the above- enumeration ofproperties,which said Rosalia S. Lugod islikewise ceding and renouncing in favor ofRolando Pedro,Florida Mierly,Alfredo and Myrna,all surnamed Sanchez,in equal pro-indiviso shares; 5. ThatRolando Pedro,Florida Mierly,Alfredo and Myrna,all surnamed Sanchezherebyacknowledge to have received jointlyand severallyin form ofadvances after October 21,1968 the aggregate sum ofEIGHT THOUSANDFIVE HUNDRED THIRTY-THREE PESOS (P8,533.94) and NINETY-FOURCENTAVOS; 6. Thatthe parties hereto likewise acknowledge and recognize in the indebtednessofthe deceased Juan G.Sanchezand hisdeceased wife Maria Villafranca Sanchezto the Lugod Enterprises,Inc., in the sum of P43,064.99; 7. Thatthe parties hereto shall be responsible for the paymentof the estate and inheritance taxesproportionate to the value oftheir respective sharesas maybe determined bythe Bureau ofInternal Revenue and shall likewise be responsible for the expensesof survey and segregation of their respective shares; 8. ThatPatricio Alburo,Maria Ramoso Sanchez,Roland Pedro Sanchez,Florida MierlySanchez,Alfredo Sanchezand Myrna Sanchezherebywaive,relinquish and renounce,jointlyand individually,in a manner thatisabsolute and irrevocable,all their rightsand interests, share and participation which they have or might have in all the properties, both real and personal,known or unknown and/or which maynotbe listed herein,or in excess of the areaslisted or mentioned herein, and/or which might have been,atone time or another,owned by, registered or placed in the name ofeither of the spouses Juan C. Sanchezor Maria Villafranca de Sanchezor both,and which either one or both might have sold,ceded,transferred, or donated to anyperson or personsor entity and which partieshereto do herebyconfirm and ratify together with all the improvementsthereon,as well asall the produce and proceedsthereof,and particularlyofthe properties,real and personal listed herein,aswell as demandable obligationsdue to the deceased spousesJuan C.Sanchez,before and after the death of the aforementioned spouses Juan C. Sanchezand Maria Villafranca de Sanchez,in favor ofoppositor Rosalia S. Lugod; 9. Thatthe expenses ofthis litigation including attorney'sfeesshall be borne respectivelyby the partieshereto; 10.That Laureta Tampusfor herself and guardian ad-litem ofher minor children,namely:Florida Mierly,Alfredo,and Myrna,all surnamed Sanchez,herebydeclare that she hasno right, interest, share and participation whatsoever in the estate leftby Juan C. Sanchezand/or Maria Villafranca de Sanchez,or both,and thatshe likewise waives, renounces,and relinquisheswhatever rigid,share,participation or interesttherein which she hasor might have in favor of Rosalia S.Lugod; 11.That, the partieshereto mutuallywaive and renounce in favor ofeach other anywhatever claims or actions, arising from, connected with, and asa resultof Special ProceedingsNos.44-M and 1022 ofthe Courtof First Instance ofMisamis Oriental,Rosalia S. Lugod,warranting thatthe parcel ofland ceded to the other partiesherein contains48 hectaresand 36 ares. 12.That, Rosalia S. Lugod shall assume asshe herebyassumes the payment to Lugod Enterprises,Inc., of the sum ofP51,598.93 representing the indebtedness of the estate ofJuan C. Sanchezand Maria Villafranca de Sanchezand the advancesmade to Rolando Pedro,Mierly,Alfredo,and Myna all surnamed Sanchez, mentioned in paragraphs5 hereto agree to have lettersofadministration issued in favor of Rosalia S. Lugod withoutanybond. That Rosalia S.Lugod likewise agreesto deliver possession and enjoymentof the parcel ofland herein ceded to petitionersand intervenorsimmediatelyafter the signing ofthis agreementand thatthe latter also mutuallyagree among themselvesto have the said lot subdivided and partitioned immediatelyin accordance with the proportion ofone sixth (1/6) partfor every petitioner and intervenor and thatin the meantime that the partition and subdivision isnot yet effected, the administrationsof said parcel ofland shall be vested jointlywith Laureta Tampos,guardian ad litem ofpetitionersand Maria Ramoso,one of the intervenorswho shall see to it thateach petitioner and intervenor isgiven one sixth (1/6) ofthe netproceedsofall agricultural harvest made thereon. WHEREFORE, itis most respectfully prayed thatthe foregoing compromise agreementbe approved. Medina,Misamis Oriental,October 30,1969. (Sgd.) (Sgd.) PATRICIO ALBURO ROSALIA S.LUGOD Intervenor-Oppositor Oppositor
  • 8. (Sgd.) MARIA RAMOSO SANCHEZASSISTEDBY: Intervenor-Oppositor (Sgd.) ASSISTEDBY:PABLO S.REYES R-101-Navarro Bldg. (Sgd.) Don A.VelezSt. REYNALDO L.FERNANDEZ Cagayan de Oro City Gingoong City (Sgd.) (Sgd.) ROLANDO PEDRO T. SANCHEZALFREDO T. SANCHEZ Petitioner Petitioner (Sgd.) (Sgd.) FLORIDA MIERLY T. SANCHEZ MYRNA T. SANCHEZ Petitioner Petitioner (Sgd.) LAURETA TAMPUS For herselfand as Guardian Ad-Litem ofthe minors Florida Mierly,Alfredo,and Myrna, all surnamed Sanchez ASSISTEDBY: TEOGENES VELEZ,JR. Counsel for Petitioners Cagayan de Oro City The Clerk ofCourt Courtof First Instance Branch III, Medina,Mis. Or. Greetings: Please set the foregoing compromise agreementfor the approval ofthe Honorable Courttoday,Oct. 30, 1969. (Sgd.) (Sgd.) (Sgd.) PABLO S.REYES TEOGENES VELEZ,JR.REYNALDO L.FERNANDEZ The Memorandum ofAgreementdated April 13,1970,which the partiesentered into with the assistance of their counsel,amended the above compromise.(It will be reproduced later in our discussion ofthe second issue raised bythe petitioners.) The Court ofAppeals,in a Resolution 10 dated September 4,1992,initiallydismissed private respondents' petition.Acting, however,on a motion for reconsideration and a supplemental motion for reconsideration dated September 14,1992 and September 25,1992,respectively, 11 RespondentCourtthereafter reinstated private respondents' petition in a resolution 12 dated October 14,1992. In due course,the Court ofAppeals,asearlier stated, rendered itsassailed Decision granting the petition,setting aside the trial court'sdecision and declaring the modified compromise agreementvalid and binding. Hence, thisappeal to this Courtunder Rule 45 ofthe Rulesof Court. The Issues In thisappeal,petitionersinvite the Court'sattention to the following issues: I The respondentcourtgrossly erred in granting the petition for certiorari under Rule 65 considering thatthe special civil action of certiorari maynot be availed ofasa substitute for an appeal and that,in anyevent, the groundsinvoked in the petition are merelyalleged errorsofjudgmentwhich can no longer be done in viewofthe fact that the decision of the lower court had long become final and executory. II Prescinding from the foregoing,the respondentcourterred in annulling the decision ofthe lower courtfor the reason thata compromise agreementor partition as the court construed the same to be, executed bythe partieson October 30,1969 wasvoid and unenforceable the same nothaving been approved bythe intestate courtand that the same having been seasonablyrepudiated bypetitionerson the ground offraud. III The respondentcourtgrossly erred in ignoring and disregardingfindingsoffactsofthe lower courtthat the alleged conveyancesofreal propertiesmade bythe spousesJuan C. Sanchezand Maria Villafranca justbefore their death in favor oftheir daughter and grandchildren,private respondentsherein,are tainted with fraud or made in contemplation ofdeath, hence,collationable. IV In anyevent, the respondentcourtgrosslyerred in treating the lower court's declaration offictitiousness of the deedsof sale asa final adjudication ofannulment. V The respondentcourtgrossly erred in declaring the termination ofthe intestate proceedingseven asthe lower courthad not made a final and enforceable distribution of the estate ofthe deceased Juan C.Sanchez. VI Prescinding from the foregoing,the respondentcourtgrossly erred in notatleast directing respondentRosalia S.Lugod to deliver the deficiencyof eight(8) hectaresdue petitionersunder the compromise agreementand memorandum ofagreement,and in notfurther directing her to include in the inventoryproperties conveyed under the deedsofsale found by the lower court to be partof the estate of Juan C. Sanchez. 13 The salientaspects of some issues are closely intertwined;hence,they are herebyconsolidated into three main issuesspecifically dealing with the following subjects: (1) the proprietyof certiorari asa remedy before the Courtof Appeals,(2) the validityof the compromise agreement,and (3) the presence of fraud in the execution of the compromise and/or collation ofthe propertiessold. The Court's Ruling The petition is notmeritorious. First Issue: Proprietyof Certiorari Before the Courtof Appeals
  • 9. Since private respondentshad neglected or failed to file an ordinaryappeal within the reglementaryperiod,petitionersallege thatthe CourtofAppealserred in allowing private respondent's recourse to Rule 65 of the Rules ofCourt. They contend thatprivate respondents' invocation of certiorari was "procedurallydefective." 14 Theyfurther argue that private respondents,in their petition before the Court ofAppeals,alleged errorsofthe trial court which,being merelyerrorsofjudgmentand noterrors of jurisdiction,were notcorrectable by certiorari.15 This Court disagrees. Doctrinally entrenched isthe general rule that certiorari isnota substitute for a lost appeal.However,Justice FlorenzD. Regalado lists several exceptionsto this rule, viz.: "(1) where the appeal doesnotconstitute a speedyand adequate remedy(Salvadadesvs.Pajarillo,etal.,78 Phil.77), aswhere 33 appealswere involved from ordersissued in a single proceeding which will inevitably resultin a proliferation ofmore appeals(PCIB vs. Escolin, etal., L-27860 and 27896,Mar.29,1974);(2) where the orderswere also issued either in excess ofor without jurisdiction (Aguilar vs.Tan, L-23600,Jun 30,1970,Cf. Bautista, et al.vs. Sarmiento,et al., L-45137,Sept.231985);(3) for certain special consideration,aspublicwelfare or publicpolicy (See Jose vs. Zulueta, etal. 16598,May31, 1961 and the casescited therein);(4) where in criminal actions,the courtrejects rebuttal evidence for the prosecution as, in case ofacquittal, there could be no remedy(People vs.Abalos,L029039,Nov. 28,1968);(5) where the order isa patentnullity (Marcelo vs. De Guzman, etal., L-29077,June 29,1982);and (6) where the decision in the certiorari case will avoid future litigations (St.Peter Memorial Park,Inc. vs. Campos, etal., L-38280,Mar.21, 1975)." 16 Even in a case where the remedy ofappeal waslost, the Court hasissued the writof certiorari where the lower courtpatently acted in excess of or outside its jurisdiction, 17 asin the presentcase. A petition for certiorari under Rule 65 ofthe Rulesof Courtis appropriate and allowable when the following requisitesconcur:(1) the writisdirected againsta tribunal,board or officer exercising judicial or quasi-judicial functions;(2) such tribunal,board or officer hasacted without or in excess of jurisdiction,or with grave abuse ofdiscretion amounting to lack or excess of jurisdiction;and (3) there is no appeal or anyplain,speedyand adequate remedyin the ordinarycourse oflaw. 18 After a thorough reviewofthe case at bar,we are convinced thatall these requirementswere met. Asa probate court,the trial courtwas exercising judicial functionswhen it issued its assailed resolution.The said court had jurisdiction to act in the intestate proceedingsinvolved in thiscase with the caveat that, due to its limited jurisdiction, itcould resolve questions oftitle onlyprovisionally. 19 It ishornbookdoctrine that"in a special proceeding for the probate ofa will,the question ofownership is an extraneousmatter which the probate courtcannotresolve with finality. This pronouncementno doubtapplieswith equal force to an intestate proceeding asin the case atbar." 20 In the instant case, the trial courtrendered a decision declaring assimulated and fictitiousall the deedsofabsolute sale which, on July26, 1963 and June 26,1967,Juan C. Sanchezand Maria Villafranca executed in favor oftheir daughter,Rosalia SanchezLugod;and grandchildren,namely,Arturo S.Lugod,Evelyn S.Lugod and Roberto S.Lugod.The trial courtruled further that the propertiescovered bythe said salesmust be subject to collation. Citing Article 1409 (2) ofthe Civil Code, the lower courtnullified said deedsof sale and determined with finality the ownership of the propertiessubjectthereof . In doing so, itclearly overstepped itsjurisdiction as a probate court.Jurisprudence teaches: [A] probate courtor one in charge ofproceedingswhether testate or intestate cannot adjudicate or determine title to propertiesclaimed to be a part ofthe estate and which are claimed to belong to outside parties.All that the said court could do asregardssaid propertiesisto determine whether theyshould or should notbe included in the inventoryor list of propertiesto be administered bythe administrator. If there isnot dispute,well and good,butif there is, then the parties, the administrator,and the opposing partieshave to resortto an ordinaryaction for a final determination ofthe conflicting claims oftitle because the probate courtcannot do so. 21 Furthermore,the trial courtcommitted grave abuse ofdiscretion when itrendered itsdecision in disregard ofthe parties' compromise agreement. 22 Such disregard,on the ground thatthe compromise agreement"wasnor approved bythe court," 23 is tantamountto "an evasion of positive duty or to a virtual refusal to perform the duty enjoined or to actin contemplation and within the boundsoflaw. " 24 The foregoing issuesclearlyinvolve notonlythe correctness of the trial court's decision butalso the latter'sjurisdiction.They encompassplain errorsofjurisdiction and grave abuse of discretion, notmerelyerrorsofjudgment. 25 Since the trial court exceeded itsjurisdiction, a petition for certiorari iscertainlya proper remedy.Indeed,itis well-settled that "(a)n actdone bya probate courtin excess of its jurisdiction maybe corrected by certiorari." 26 Consistent with the foregoing,the following disquisition byrespondentappellate courtisapt: Asa general proposition,appeal isthe proper remedyofpetitioner Rosalia here under Rule 109 ofthe Revised RulesofCourt.Butthe availabilityofthe ordinary course of appeal doesnotconstitute sufficient ground to [prevent]a partyfrom making use of the extraordinaryremedyof certiorari where appeal isnotan adequate remedyor equallybeneficial,speedyand sufficient (Echauzvs. Court ofAppeals,199 SCRA 381).Here,considering that the respondentcourthasdisregarded the compromise agreementwhich haslong been executed asearlyas October,1969 and declared null and void the deedsofsale with finality, which, asa probate court, it hasno jurisdiction to do, We deem ordinaryappeal isinadequate.Considering further the [trial court's]granting of[herein petitioners') motion for execution of the assailed decision, 27 [herein private respondent]Rosalia'sresortto the instant petition [for reviewon certiorari]is all the more warranted under the circumstances. 28 We thus hold thatthe questioned decision and resolutionsofthe trial courtmay be challenged through a special civil action for certiorari under Rule 65 ofthe Rules ofCourt. At the very least, this case is a clear exception to the general rule that certiorari isnota substitute for a lost appeal because the trial court'sdecision and resolutionswere issued without or in excess of jurisdiction,which maythus be challenged or attacked atany time. "A void judgmentfor want ofjurisdiction is no judgmentatall. It cannotbe the source of anyrightnor the creator ofany obligation.All acts performed pursuantto itand all claims emanating from it have no legal effect. Hence, itcan never become final and anywritof execution based on itis void; ' .. . itmay be said to be a lawlessthing which can be treated as an outlawand slain atsight, or ignored wherever and whenever itexhibits its head.' " 29 Second Issue: Validityof Compromise Agreement Petitionerscontend that, because the compromise agreementwasexecuted during the pendencyofthe probate proceedings,judicial approval isnecessaryto shroud it with validity. They stress that the probate courthad jurisdiction over the propertiescovered bysaid agreement.Theyadd that PetitionersFlorida Mierly,Alfredo and Myrna were all minersrepresented onlyby their mother/natural guardian,Laureta Tampus. 30 These contentions lackmerit. Article 2028 of the Civil Code definesa compromise agreementas"a contract wherebythe parties, bymaking reciprocal concessions, avoid a litigation or put an end to one alreadycommenced." Being a consensual contract, it isperfected upon the meeting ofthe minds ofthe parties. Judicial approval isnotrequired for its perfection. 31 Petitioners' argumentthatthe compromise was notvalid for lack of judicial approval isnotnovel;the same wasraised in Mayuga vs. Courtof Appeals,32 where the Court, through Justice Irene R. Cortes, ruled: It is alleged thatthe lack ofjudicial approval isfatal to the compromise. A compromise is a consensual contract. As such, itis perfected upon the meeting of the mindsof the partiesto the contract. (Hernandezv.Barcelon,23 Phil.599 [1912];see also De losReyes v. de Ugarte, 75 Phil.505 [1945].) And from that moment notonly doesitbecome binding upon the parties(De losReyes v. De Ugarte, supra ),it also hasupon them the effect and authorityof resjudicata (Civil Code,Art. 2037),even ifnot judiciallyapproved (Menesesv.De la Rosa,77 Phil. 34 [1946];Vda.De Guilasv.David, 132 Phil.241,L-24280,23 SCRA 762 [May27, 1968]; Cochingyan v. Cloribel,L-27070-71 [April 22,1977],76 SCRA 361).(Emphasisfound in the original.) In the case before us, it isineludible thatthe partiesknowinglyand freely entered into a valid compromise agreement.Adequatelyassisted by their respective counsels, they each negotiated its terms and provisionsfor four months; in fact, said agreementwasexecuted onlyafter the fourth draft. Asnoted by the trial court itself, the first and second drafts were prepared successively in July, 1969;the third draft on September 25,1969;and the fourth draft, which was finallysigned bythe partieson October 30,1969,33 followed. Since thiscompromise agreementwasthe resultofa long drawn outprocess,with all the parties ablystriving to protect their respective interests and to come outwith the best theycould, there can be no doubt that the partiesentered into it freelyand voluntarily.Accordingly, theyshould be bound thereby. 34 To be valid, itis merelyrequired under the lawto be based on real claimsand actually agreed upon in good faith bythe partiesthereto. 35 Indeed,compromise is a form ofamicable settlement that isnot onlyallowed butalso encouraged in civil cases. 36 Article 2029 ofthe Civil Code mandatesthat a "court shall endeavor to persuade the litigantsin a civil case to agree upon some fair compromise." In opposing the validityand enforcementofthe compromise agreement,petitionersharp on the minorityof Florida Mierly,Alfredo and Myna.Citing Article 2032 ofthe Civil Code,they contend that the court'sapproval isnecessary in compromises entered into byguardiansand parentsin behalfoftheir wardsor children. 37
  • 10. However, we observe that although denominated a compromise agreement,the documentin thiscase is essentially a deed ofpartition,pursuantto Article 1082 ofthe Civil Code which providesthat "[e]very act which is intended to putan end to indivision among co-heirsand legateesor deviseesisdeemed to be a partition, although itshould purportto be a sale,an exchange,a compromise, or anyother transaction." For a partition to be valid,Section 1, Rule 74 of the Rulesof Court, requiresthe concurrence ofthe following conditions:(1) the decedentleftno will; (2) the decedentleft no debts, or ifthere were debtsleft, all had been paid;(3) the heirsand liquidatorsare all ofage,or iftheyare minors, the latter are represented bytheir judicial guardian or legal representatives;and (4) the partition was made bymeansof a publicinstrumentor affidavit duly filed with the Register of Deeds. 38 We find that all the foregoing requisitesare presentin thiscase. We therefore affirm the validity of the parties' compromise agreement/partition in thiscase. In anyevent, petitionersneither raised nor ventilated thisissue in the trial court. This newquestion or matter was manifestly beyond the pale ofthe issuesor questions submitted and threshed outbefore the lower court which are reproduced below, viz.: I Are the propertieswhich are the objectof the sale by the deceased spousesto their grandchildren collationable? II Are the propertieswhich are the object ofthe sale bythe deceased spousesto their legitimate daughter also collationable? III The first and second issues being resolved,howmuch then is the rightful share of the four (4) recognized illegitimate children? 39 Furthermore,the 27-page Memorandum dated February17,1990 filed bypetitionersbefore the Regional Trial Court 40 readilyrevealsthattheynever questioned the validity ofthe compromise. In their comment before the Court ofAppeals, 41 petitionersbased their objection to sad compromise agreementon the solitary"reason that itwas tainted with fraud and deception," zeroing specifically on the alleged fraud committed by private respondentRosalia S.Lugod. 42 The issue of minoritywas first raised onlyin petitioners' Motion for Reconsideration of the Courtof Appeals' Decision; 43 thus, it "isas ifit was never dulyraised in thatcourt at all." 44 Hence, this Courtcannotnow, for the first time on appeal,entertain this issue,for to do so would plainlyviolate the basic rule offair play, justice and due process. 45 We take this opportunityto reiterate and emphasize the well-settled rule that"(a)n issue raised for the first time on appeal and notraised timelyin the proceedingsin the lower courtis barred byestoppel.Questions raised on appeal mustbe within the issues framed bythe parties and,consequently, issues notraised in the trial courtcannotbe raised for the first time on appeal." 46 The petitionerslikewise assail as void the provision on waiver contained in No. 8 ofthe aforequoted compromise,because itallegedlyconstitutes a relinquishmentbypetitionersof"a rightto propertieswhich were notknown." 47 They argue thatsuch waiver iscontrary to law, publicpolicy, moralsor good custom. The Courtdisagrees.The assailed waiver pertained to their hereditaryrightto propertiesbelonging to the decedent'sestate which were not included in the inventoryofthe estate'sproperties.It also covered their rightto other propertiesoriginally belonging to the spouses Juan Sanchezand Maria Villafranca de Sanchezwhich have been transferred to other persons.In addition,the parties agreed in the compromise to confirm and ratify said transfers. The waiver isvalid because, contraryto petitioners' protestation,the parties waived a known and existing interest — their hereditaryrightwhich was alreadyvested in them by reason ofthe death oftheir father. Article 777 ofthe Civil Code providesthat "(t)he rightsto the succession are transmitted from the momentof death ofthe decedent." Hence,there is no legal obstacle to an heir'swaiver ofhis/her hereditaryshare "even ifthe actual extentof such share isnotdetermined until the subsequentliquidation ofthe estate." 48 Atanyrate, such waiver is consistent with the intentand letter ofthe law advocating compromise asa vehicle for the settlement ofcivil disputes. 49 Finally, petitionerscontend thatPrivate RespondentRosalia T.Lugod'salleged fraudulentacts,specifically her concealment ofsome ofthe decedent'sproperties,attended the actual execution of the compromise agreement. 50 This argumentisdebunked bythe absence of anysubstantial and convincing evidence on record showing fraud on her part.Asaptlyobserved by the appellate court: [Herein petitioners] accuse [herein private respondent]Rosalia offraud or deception by alleging, inter alia,thatthe parcel of land given to them never conformed to the stated area,i.e., forty-eight (48) hectares,as stated in the compromise agreement.We find this argumentunconvincing and unmeritorious.[Herein petitioners'] avermentof fraud on the partof [herein private respondent]Rosalia becomesuntenable when We consider the memorandum ofagreementtheylater executed with [herein private respondent]Rosalia wherein said compromise agreementwasmodified bycorrecting the actual area given to [herein petitioners]from forty-eight(48) hectaresto thirty-six (36) hectaresonly. If the actual area allotted to them did not conform to the 48 hectare area stated in the compromise agreement,then why did they agree to the memorandum ofagreementwherebytheir share in the estate of their father waseven reduced to just 36 hectares? Where isfraud or deception there? Considering that[herein petitioners]were ablyrepresented bytheir lawyersin executing these documents and who presumablyhad explained to them the importand consequencesthereof,it is hard to believe their charge thatthey were defrauded and deceived by[herein private respondent]Rosalia. If the parcel of land given to [herein petitioners], when actuallysurveyed, happened to be differentin area to the stated area of48 hectaresin the compromise agreement,this circumstance isnot enough proofoffraud or deception on [herein private respondent]Rosalia'spart.Note thatTax Declaration No. 06453 plainly discloses thatthe land transferred to [herein petitioners]pursuantto the compromise agreementcontained an area of48 hectares(Annex"A",Supplemental Reply). And when [herein petitioners]discovered thatthe land allotted to them actuallycontained only24 hectares, a conference between the partiestook place which led to the execution and signing ofthe memorandum ofagreementwherein [herein petitioners']distributive share waseven reduced to 36 hectares.In the absence of convincing and clear evidence to the contrary, the allegation offraud and deception cannotbe successfully imputed to [herein private respondent]Rosalia who must be presumed to have acted in good faith. 51 The memorandum ofagreementfreelyand validlyentered into bythe partieson April 13,1970 and referred to above reads: MEMORANDUM OFAGREEMENT The partiesassisted by their respective counsel have agreed astheyherebyagree: 1. To amend the compromise agreementexecuted bythem on October 30,1969 so as to include the following: a. Correction ofthe actual area being given to the petitionersand intervenors,all illegitimate children ofthe late Juan C. Sanchez, forty- eight(48) hectares,thirty-six (36) aresasembodied in the aforementioned compromise agreementto thirty-six(36) hectaresonly, thus enabling each ofthem to getsix (6) hectareseach. b. Thatthe said 36-hectare area shall be taken from thatparcel of land which isnow covered byO.C.T. No. 146 (Patent No.30012) and the adjoining areasthereofdesignated asLotA and LotCas reflected on the sketch plan attached to the record ofthis case prepared by GeodeticEngineer Olegario E.Zallespursuantto the Court'scommission of March 10,1970 provided,however,that ifthe said 36-hectare area could notbe found after adding thereto the areasofsaid lotsA and C,then the additional area shall be taken from whatis designated asLot B,likewise also reflected in the said sketch plan attached to the records; c. That the partition among the six illegitimate children ofthe late Juan C. Sanchez(petitionersand intervenors) shall be effective among themselves in such a manner to be agreed upon bythem,each undertaking to assume redemption ofwhatever plants found in their respective shareswhich need redemption from the tenants thereofaswell as the continuity ofthe tenancyagreementsnowexisting and covering the said shares or areas. d. The subdivision surveyshall be at the expense of the said petitionersand intervenorsprorata. e. Thatthe administratrix agreesto deliver temporaryadministration ofthe area designated asLot5 ofthe VallesSketch Plan pending final survey ofthe said 36-hectare area. Cagayan de Oro City, April 13,1970. (Sgd.) LAURETA TAMPOS For herselfand as Guardian ad-litem of Rolando,Mierly, Alfredo and Myrna,all surnamed Sanchez
  • 11. Assisted by: (Sgd.) TEOGENES VELEZ,Jr. Counsel for Petitioners (Sgd.) ROSALIA S.LUGOD Administratrix Assisted by: (Sgd.) PABLO S.REYES Counsel for Administratrix (Sgd.) MARIA RABOSO SANCHEZ Intervenor 52 Not onlydid the partiesknowinglyenter into a valid compromise agreement;they even amended itwhen theyrealized some errorsin the original.Such correction emphasizesthe voluntariness of said deed. It is also significant thatall the parties,including the then minors, had already consummated and availed themselvesofthe benefits oftheir compromise.53 This Courthas consistently ruled that "a partyto a compromise cannot askfor a rescission after it hasenjoyed its benefits." 54 Bytheir acts, the partiesare ineludiblyestopped from questioning the validityof their compromise agreement.Bolstering thisconclusion is the fact thatpetitionersquestioned the compromise only nine yearsafter its execution, when theyfiled with the trial courttheir Motion to Defer Approval ofCompromise Agreement,dated October 26,1979. 55 In hindsight,it is notat all farfetched that petitionersfiled said motion for the sole reason that theymay have felt shortchanged in their compromise agreementor partition with private respondents,which in their viewwas unwise and unfair. While we maysympathize with this rueful sentimentof petitioners,we can onlystress thatthis alone isnotsufficient to nullify or disregard the legal effectsof said compromise which, by its verynature asa perfected contract, is binding on the parties. Moreover,courtshave no jurisdiction to lookinto the wisdom of a compromise or to render a decision differenttherefrom.56 It isa well-entrenched doctrine that"the law doesnot relieve a partyfrom the effects of an unwise,foolish, or disastrouscontract, entered into with all the required formalitiesand with full awarenessofwhat he wasdoing" 57 and "a compromise entered into and carried outin good faith will notbe discarded even if there wasa mistake oflawor fact, (McCarthy vs. Barber Steamship Lines,45 Phil.488) because courtshave no power to relieve partiesfrom obligationsvoluntarilyassumed,simply because their contracts turned outto be disastrousdealsor unwise investments." 58 Volenti non fitinjuria. Corollarily,the petitionerscontend that the Court ofAppealsgravelyabused its discretion in deeming Special ProceedingsNos.44-M and 1022 "CLOSEDand TERMINATED," arguing that there was asyet no order ofdistribution ofthe estate pursuantto Rule 90 of the Rulesof Court. Theyadd that theyhad not received their full share thereto. 59 We disagree.Under Section 1, Rule 90 of the Rulesof Court, an order for the distribution ofthe estate may be made when the "debts, funeral charges,and expensesof administration,the allowance to the widow,and inheritance tax, ifany," had been paid.Thisorder for the distribution of the estate's residue mustcontain the namesand sharesof the personsentitled thereto.A perusal ofthe whole record, particularlythe trial court'sconclusion, 60 revealsthatall the foregoing requirementsalreadyconcurred in thiscase.The paymentof the indebtednessofthe estates ofJuan C. Sanchezand Maria Villafranca in the amountofP51,598.93 was shouldered byPrivate RespondentRosalia,who also absorbed or charged againsther share the advancesofRolando T.Lugod in the sum ofP8,533.94,in compliance with Article 1061 ofthe Civil Code on collation. 61 Furthermore,the compromise of the parties, which is the lawbetween them, alreadycontainsthe names and sharesofthe heirsto the residual estate,which shareshad also been delivered.On thispoint,we agree with the following discussion of the Court ofAppeals: Butwhat the (trial court) obviouslyoverlooked in itsappreciation ofthe facts of thiscase are the uncontroverted facts that (herein petitioners) have been in possession and ownership oftheir respective distributive shares asearlyas October 30,1969 and theyhave received other propertiesin addition to their distributive sharesin consideration ofthe compromise agreementwhich theynow assail.Proofs thereofare TaxDeclarationsNo. 20984,20985,20986,20987,20988,20989 and 20990 (Annexes"B" to "H", Supplemental Reply) in the respective namesof (herein petitioners),all for the year 1972.(Herein petitioners) also retained a house and lot, a residential lotand a parcel ofagricultural land (Annexes"I","J" and "K",Ibid.) all ofwhich were notconsidered in the compromise agreementbetween the parties. Moreover,in the compromise agreement per se,it is undoubtedlystated therein thatcash advancesin the aggregate sum of P8,533.94 were received by (herein petitioners) after October 21,1968 (Compromise Agreement,par.5) 62 All the foregoing showclearlythat the probate courthad essentially finished said intestate proceedingswhich,consequently,should be deemed closed and terminated.In view ofthe above discussion, the Court seesno reversible error on the partofthe Courtof Appeals. Third Issue: Fraud and Collation Petitionersfault RespondentCourtfor not ordering Private RespondentRosalia T.Lugod to deliver to them the deficiency as allegedlyprovided under the compromise agreement.They further contend that said court erred in notdirecting the provisional inclusion ofthe alleged deficiencyin the inventoryfor purposesofcollating the propertiessubject ofthe questioned deeds of sale.63 We see no such error.In the trial court, there was onlyone hearing conducted,and itwasheld onlyfor the reception ofthe evidence ofRosalia S. Lugod to install her as administratrixof the estate of Maria Villafranca.There wasno other evidence,whether testimonial or otherwise,"received, formallyoffered to, and subsequentlyadmitted by the probate courtbelow"; nor wasthere "a trial on the merits ofthe parries' conflicting claims." 64 In fact, the petitioners"moved for the defermentof the compromise agreementon the basisof alleged fraudulentconcealmentofproperties — NOTbecause of anydeficiency in the land conveyed to them under the agreements." 65 Hence, there isno hard evidence on record to backup petitioners' claims. In anycase, the trial court noted Private RespondentRosalia'swillingnessto reimburse anydeficiency actuallyproven to exist. It subsequentlyordered the geodeticengineer who prepared the certification and the sketch ofthe lot in question,and who could have provided evidence for the petitioners,"to bring recordsofhis relocation survey." 66 However,GeodeticEngineer Idulsa did not complywith the court's subpoena ducestecum and ad testificandum. Neither did he furnish the required relocation survey. 67 No wonder,even after a thorough scrutinyofthe records,this Court cannotfind anyevidence to supportpetitioners' allegationsoffraud againstPrivate RespondentRosalia. Similarly,petitioners' allegationsoffraud in the execution ofthe questioned deedsofsale are bereft ofsubstance, in view ofthe palpable absence ofevidence to supportthem.The legal presumption ofvalidity ofthe questioned deedsofabsolute sale,being dulynotarized publicdocuments,hasnot been overcome.68 On the other hand,fraud is notpresumed.It must be proved byclear and convincing evidence,and notby mere conjecturesor speculations. We stress that these deedsof sale did notinvolve gratuitoustransfers of future inheritance;these were contracts of sale perfected by the decedentsduring their lifetime. 69 Hence,the propertiesconveyed therebyare notcollationable because,essentially,collation mandated under Article 1061 ofthe Civil Code contemplates propertiesconveyed inter vivosby the decedentto an heir bywayof donation or other gratuitoustitle. In anyevent, these alleged errorsand deficienciesregarding the deliveryofsharesprovided in the compromise,concealment ofpropertiesand fraud in the deedsofsale are factual in nature which, asa rule, are notreviewable bythisCourt in petitionsunder Rule 45. 70 Petitionershave failed to convince us thatthis case constitutes an exception to such rule. All in all,we find that the Court ofAppealshassufficiently addressed the issuesraised bythem. Indeed,they have notpersuaded usthat said Courtcommitted anyreversible error to warranta grantof their petition. WHEREFORE, the petition is herebyDENIEDand the assailed Decision ofthe CourtofAppealsis AFFIRMED. SO ORDERED. GRACE J. GARCIA, a.k.a. GRACE J. GARCIA-RECIO, petitioner, vs. REDERICK A. RECIO, respondent. D E CI S I O N PANGANIBAN, J.:
  • 12. A divorce obtained abroad byan alien maybe recognized in our jurisdiction,provided such decree isvalid according to the national lawofthe foreigner. However,the divorce decree and the governing personal lawofthe alien spouse who obtained the divorce must be proven. Our courts do nottake judicial notice offoreign lawsand judgments; hence,like anyother facts, both the divorce decree and the national lawofthe alien must be alleged and proven according to our lawon evidence. The Case Before usis a Petition for Review under Rule 45 ofthe Rules ofCourt, seeking to nullifythe January7, 1999 Decision and the March 24,1999 Order ofthe Regional Trial Courtof Cabanatuan City, Branch 28,in Civil Case No. 3026–AF. The assailed Decision disposed as follows: “WHEREFORE, thisCourt declaresthe marriage between Grace J.Garcia and RederickA.Recio solemnized on January12,1994 atCabanatuan Cityas dissolved and both partiescan nowremarryunder existing and applicable lawsto anyand/or both parties.” The assailed Order denied reconsideration ofthe above-quoted Decision. The Facts RederickA. Recio, a Filipino,wasmarried to Editha Samson,an Australian citizen,in Malabon,Rizal, on March 1, 1987.Theylived together as husband and wife in Australia. On May18, 1989,a decree ofdivorce, purportedlydissolving the marriage,wasissued by an Australian familycourt. On June 26,1992,respondentbecame an Australian citizen,as shown bya “Certificate ofAustralian Citizenship” issued by the Australian government.Petitioner -- a Filipina -- and respondentwere married on January12,1994 in Our LadyofPerpetual Help Church in Cabanatuan City.In their application for a marriage license,respondentwasdeclared as“single” and “Filipino.” Starting October 22,1995,petitioner and respondentlived separatelywithoutprior judicial dissolution oftheir marriage. While the two were still in Australia,their conjugal assets were divided on May16, 1996,in accordance with their Statutory Declarationssecured in Australia. On March 3, 1998,petitioner filed a Complaintfor Declaration of Nullityof Marriage in the court a quo,on the ground ofbigamy -- respondentallegedlyhad a prior subsisting marriage atthe time he married her on January12,1994. She claimed thatshe learned ofrespondent’smarriage to Editha Samson onlyin November,1997. In hisAnswer,respondentaverred that,as far back as1993,he had revealed to petitioner hisprior marriage and itssubsequentdissolution.He contended that hisfirst marriage to an Australian citizen had been validlydissolved by a divorce decree obtained in Australia in 1989;thus,he waslegallycapacitated to marry petitioner in 1994. On July 7,1998 -- or aboutfive years after the couple’swedding and while the suitfor the declaration ofnullitywas pending -- respondentwasable to secure a divorce decree from a family courtin Sydney,Australia because the “marriage ha[d]irretrievablybroken down.” Respondentprayed in hisAnswer that the Complaintbe dismissed on the ground thatit stated no cause ofaction. The Office ofthe Solicitor General agreed with respondent.The court marked and admitted the documentary evidence ofboth parties. After they submitted their respective memoranda,the case wassubmitted for resolution. Thereafter,the trial court rendered the assailed Decision and Order. Ruling ofthe Trial Court The trial court declared the marriage dissolved on the ground thatthe divorce issued in Australia was valid and recognized in the Philippines. Itdeemed the marriage ended,butnoton the basisof anydefect in an essential elementof the marriage;that is, respondent’salleged lackoflegal capacityto remarry. Rather, it based its Decision on the divorce decree obtained by respondent. The Australian divorce had ended the marriage;thus,there was no more marital union to nullifyor annul. Hence, thisPetition. Issues Petitioner submits the following issues for our consideration: “1 The trial court gravelyerred in finding thatthe divorce decree obtained in Australia bythe respondent ipso facto terminated hisfirst marriage to Editha Samson therebycapacitating him to contract a second marriage with the petitioner. “2 The failure of the respondent,who isnow a naturalized Australian,to presenta certificate of legal capacityto marryconstitutes absence ofa substantial requisite voiding the petitioner’s marriage to the respondent “3 The trial court seriouslyerred in the application ofArt. 26 ofthe FamilyCode in thiscase. “4 The trial court patentlyand grievouslyerred in disregarding Arts.11,13,21, 35,40,52 and 53 ofthe Family Code asthe applicable provisionsin thiscase. “5 The trial court gravelyerred in pronouncing thatthe divorce decree obtained bythe respondentin Australia ipso facto capacitated the partiesto remarry, withoutfirst securing a recognition of the judgmentgranting the divorce decree before our courts.” The Petition raises five issues, but for purposesof thisDecision, we shall concentrate on two pivotal ones:(1) whether the divorce between respondentand Editha Samson wasproven,and (2) whether respondentwasproven to be legallycapacitated to marrypetitioner. Because ofour ruling on these two, there isno more necessity to take up the rest. The Court’s Ruling The Petition is partlymeritorious. First Issue: Proving the Divorce Between Respondentand Editha Samson Petitioner assailsthe trial court’s recognition ofthe divorce between respondentand Editha Samson. Citing Adong v.Cheong Seng Gee, petitioner arguesthatthe divorce decree,like any other foreign judgment,maybe given recognition in this jurisdiction onlyupon proofofthe existence of(1) the foreign law allowing absolute divorce and (2) the alleged divorce decree itself. She addsthatrespondentmiserablyfailed to establish these elements. Petitioner addsthat, based on the first paragraph ofArticle 26 ofthe Family Code,marriagessolemnized abroad are governed bythe lawofthe place where they were celebrated (the lex loci celebrationis). In effect, the Code requiresthe presentation ofthe foreign lawto show the conformity of the marriage in question to the legal requirementsofthe place where the marriage wasperformed. At the outset, we lay the following basiclegal principlesasthe take-off pointsfor our discussion. Philippine lawdoesnotprovide for absolute divorce;hence,our courts cannotgrantit. A marriage between two Filipinoscannotbe dissolved even by a divorce obtained abroad,because ofArticles15 and 17 ofthe Civil Code. In mixed marriagesinvolving a Filipino and a foreigner,Article 26 ofthe Family Code allowsthe former to contract a subsequentmarriage in case the divorce is “validly obtained abroad bythe alien spouse capacitating him or her to remarry.” A divorce obtained abroad bya couple,who are both aliens,may be recognized in the Philippines,provided itisconsistent with their respective national laws. A comparison between marriage and divorce,asfar as pleading and proofare concerned,can be made. Van Dorn v.Romillo Jr. decreesthat“aliensmay obtain divorcesabroad,which may be recognized in the Philippines,provided theyare valid according to their national law.” Therefore,before a foreign divorce decree can be recognized byour courts,the party pleading it must prove the divorce as a fact and demonstrate its conformity to the foreign lawallowing it. Presentation solelyofthe divorce decree isinsufficient. Divorce as a Question of Fact Petitioner insists that before a divorce decree can be admitted in evidence,it must first comply with the registration requirementsunder Articles11,13 and 52 ofthe Family Code. These articles read asfollows: “ART. 11. Where a marriage license isrequired,each ofthe contracting partiesshall file separatelya sworn application for such license with the proper local civil registrar which shall specify the following: x xx x x x x x x