27. VALERA VS.
INSERTO
Doctrine: RULE 87, Section 6. Proceedings when property concealed, embezzled, or
fraudulently conveyed. — If an executor or administrator, heir, legatee, creditor or other
individual interested in the estate of the deceased, complains to the court having jurisdiction of
the estate that a person is suspected of having concealed, embezzled, or conveyed away any of
the money, goods, or chattels of the deceased, or that such person has in his possession or has
knowledge of any deed, conveyance, bond, contract, or other writing which contains evidence
of or tends or discloses the right, title, interest, or claim of the deceased, the court may cite
such suspected person to appear before it any may examine him on oath on the matter of such
complaint; and if the person so cited refuses to appear, or to answer on such examination or
such interrogatories as are put to him, the court may punish him for contempt, and may
commit him to prison until he submits to the order of the court. The interrogatories put any
such person, and his answers thereto, shall be in writing and shall be filed in the clerk's office.
The Court, presided over by Hon. Judge Midpantao Adil, viewed the Garin Heirs' motion for contempt, as
well as Cabado's prayer for the fishpond's return to the estate, as having given rise to a claim for the
recovery of an asset of the estate within the purview of Section 6, Rule 87 of the Rules of Court. It
accordingly set said incidents for hearing during which the parties presentee evidence in substantiation of
their positions. Thereafter, the Court issued an Order dated September 17, 1980 commanding the Heirs of
Teresa Garin "to reconvey immediately the fishpond in question * * to the intestate Estate of the Spouses.
FACTS: Rafael Valera was granted leasehold rights over an 18 hectare fishpond in Iloilo by the
Government to last during his lifetime. He transferred it by “fictitious sale” to his daughter Teresa to
support her children with the agreement that when the children finish schooling, the fishpond will be
returned to him. Valera and his spouse Consolacion Sarosa and their child Teresa died. The heirs of
Teresa—her husband Jose Garin and their children bought the fishpond from the government acquiring
title thereto. The administrators of the Spouses Rafael Valera and Consolacion Sarosa filed before the
Probate Court and claim the fishpond to the spouses’ estates. The Probate Court presided by Judge Adil
held that there has been an implied trust created, therefore the fishpond should be restored to the estate of
the spouses pursuant to Articles 1453 and 1455 of the Civil Code1. Pursuant thereto, he directed the
sheriff to enforce reconveyance of the fishpond to the estate. The fishpond was leased by the Garin Heirs
to Fabiana, who although willingly surrendered it to the sheriff, later filed a complaint-in-intervention.
This was dismissed so he instituted a separate action for injunction and damages
CA: reversed (fishpond be returned to Garin Heirs and their lessee Fabiana) saying that:
Probate Court had no jurisdiction
That the Title of the Garin Heirs is a stronger claim that rebuts the presumption that the
estate owns the fishpond; and
That assuming the Probate Court had competence to resolve ownership, a separate action
has to be filed
1
ISSUE: Whether the probate court had authority to order reconveyance of the fishpond
HELD: NO. The RTC, acting as Probate Court, exercises but limited jurisdiction, and thus has no
power to take cognizance of and determine the issue of the title to property claimed by a third
person adversely to the decedent, unless the claimant and all the other parties having legal interest in
the property consent, expressly or impliedly, to the submission of the question of the Probate Court for
adjudgment, or the interests of the third person are not thereby prejudiced This is issue not a
jurisdictional, but procedural, involving a mode of practice which may be waived. The facts obtaining in
this case, however, do not call for the application of the exception to the rule.
It was at all times clear to the Court as well as to the parties that if cognizance was being taken of
the question of title over the fishpond, it was not for the purpose of settling the issue definitely and
permanently, and writing “finis” thereto, the question being explicitly left for determination “in an
ordinary civil action,” but merely to determine whether it should or should not be included in the
inventory. This function of resolving WON property should be included in the estate inventory is, to be
sure, one clearly within the Probate Court’s competence, although the Court’s determination is only
provisional in character, not conclusive, and is subject to the final decision in a separate action that may
be instituted by the parties.
The same norm governs the situation contemplated in Section 6, Rule 87 of the Rules of Court, expressly
invoked by the Probate Court in justification of its holding a hearing on the issue arising from the parties'
conflicting claims over the fishpond. The examination provided in the cited section is intended merely to
elicit evidence relevant to property of the decedent from persons suspected of having possession or
knowledge thereof, or of having concealed, embezzled, or conveyed away the same. Of course, if the
latter lays no claim to the property and manifests willingness to tum it over to the estate, no difficulty
arises; the Probate Court simply issues the appropriate direction for the delivery of the property to the
estate. On the other hand, if the third person asserts a right to the property contrary to the decedent's, the
Probate Court would have no authority to resolve the issue; a separate action must be instituted by the
administrator to recover the property.
Since the determination by the Probate Court of the question of title to the fishpond was merely
provisional, the fishpond cannot be the subject of execution, as against its possessor who has set up
title in himself (or in another) adversely to the decedent, and whose right to possess has not been
ventilated and adjudicated in an appropriate action. These considerations assume greater cogency,
where, as here, the Torrens title to the property is not in the decedent’s names but in others. A separate
action must be instituted by the administrator to recover the property. CA decision was affirmed
Parenthetically, in the light of the foregoing principles, the Probate Court could have admitted and taken
cognizance of Fabiana's complaint in intervention after obtaining the consent of all interested parties to its
assumption of jurisdiction over the question of title to the fishpond, or ascertaining the absence of
objection thereto. But it did not. It dismissed the complaint in intervention instead. And all this is now
water under the bridge.
