Gala vs. Ellice
G.R. No. 156819.  December 11, 2003

Moreover, the reliefs sought by petitioners should have been raised in a proceeding for settlement of estate, rather than in the present intra-corporate controversy.  If they are genuinely interested in securing that part of their late father’s property which has been reserved for them in their capacity as compulsory heirs, then they should simply exercise their actio ad supplendam legitimam, or their right of completion of legitime. Such relief must be sought during the distribution and partition stage of a case for the settlement of the estate of Manuel Gala, filed before a court which has taken jurisdiction over the settlement of said estate.

It is always sad to see families torn apart by money matters and property disputes. The concept of a close corporation organized for the purpose of running a family business or managing family property has formed the backbone of Philippine commerce and industry.  Through this device, Filipino families have been able to turn their humble, hard-earned life savings into going concerns capable of providing them and their families with a modicum of material comfort and financial security as a reward for years of hard work.  A family corporation should serve as a rallying point for family unity and prosperity, not as a flashpoint for familial strife.  It is hoped that people reacquaint themselves with the concepts of mutual aid and security that are the original driving forces behind the formation of family corporations and use these tenets in order to facilitate more civil, if not more amicable, settlements of family corporate disputes.

Jao vs. CA G.R. No. 128314, May 29, 2002

Rodolfo and Perico Jao were the only sons of the spouses Ignacio Jao Tayag and Andrea V. Jao, who died intestate in 1988 and 1989, respectively.  The decedents left real estate, cash, shares of stock and other personal properties.

On April 17, 1991, Perico instituted a petition for issuance of letters of administration before the Regional Trial Court of Quezon City, Branch 99, over the estate of his parents, docketed as Special Proceedings No. Q-91-8507. Pending the appointment of a regular administrator, Perico moved that he be appointed as special administrator.  He alleged that his brother, Rodolfo, was gradually dissipating the assets of the estate.  More particularly, Rodolfo was receiving rentals from real properties without rendering any accounting, and forcibly opening vaults belonging to their deceased parents and disposing of the cash and valuables therein.

Rodolfo moved for the dismissal of the petition on the ground of improper venue. He argued that the deceased spouses did not reside in Quezon City either during their lifetime or at the time of their deaths.  The decedent’s actual residence was in Angeles City, Pampanga, where his late mother used to run and operate a bakery.  As the health of his parents deteriorated due to old age, they stayed in Rodolfo’s residence at 61 Scout Gandia Street, Quezon City, solely for the purpose of obtaining medical treatment and hospitalization.  Rodolfo submitted documentary evidence previously executed by the decedents, consisting of income tax returns, voter’s affidavits, statements of assets and liabilities, real estate tax payments, motor vehicle registration and passports, all indicating that their permanent residence was in Angeles City, Pampanga.

In his opposition, Perico countered that their deceased parents actually resided in Rodolfo’s house in Quezon City at the time of their deaths.  As a matter of fact, it was conclusively declared in their death certificates that their last residence before they died was at 61 Scout Gandia Street, Quezon City. Rodolfo himself even supplied the entry appearing on the death certificate of their mother, Andrea, and affixed his own signature on the said document.

Rodolfo filed a rejoinder, stating that he gave the information regarding the decedents’ residence on the death certificates in good faith and through honest mistake.  He gave his residence only as reference, considering that their parents were treated in their late years at the Medical City General Hospital in Mandaluyong, Metro Manila.  Their stay in his house was merely transitory, in the same way that they were taken at different times for the same purpose to Perico’s residence at Legaspi Towers in Roxas Boulevard.  The death certificates could not, therefore, be deemed conclusive evidence of the decedents’ residence in light of the other documents showing otherwise.

The court required the parties to submit their respective nominees for the position. Both failed to comply, whereupon the trial court ordered that the petition be archived.

Subsequently, Perico moved that the intestate proceedings be revived. After the parties submitted the names of their respective nominees, the trial court designated Justice Carlos L. Sundiam as special administrator of the estate of Ignacio Jao Tayag and Andrea Jao.

On April 6, 1994, the motion to dismiss filed by petitioner Rodolfo was denied, to wit:

A mere perusal of the death certificates of the spouses issued separately in 1988 and 1989, respectively, confirm the fact that Quezon City was the last place of residence of the decedents.  Surprisingly, the entries appearing on the death certificate of Andrea V. Jao were supplied by movant, Rodolfo V. Jao, whose signature appears in said document.  Movant, therefore, cannot disown his own representation by taking an inconsistent position other than his own admission. 

Rodolfo filed a petition for certiorari with the Court of Appeals, which was docketed as CA-G.R. SP No. 35908.  On December 11, 1996, the Court of Appeals rendered the assailed decision, the dispositive portion of which reads:

WHEREFORE, no error, much less any grave abuse of discretion of the court a quo having been shown, the petition for certiorari is hereby DISMISSED.  The questioned order of the respondent Judge is affirmed in toto.

SO ORDERED.

Rodolfo’s motion for reconsideration was denied by the Court of Appeals in the assailed resolution dated February 17, 1997.

The main issue before us is:  where should the settlement proceedings be had ---  in Pampanga, where the decedents had their permanent residence, or in Quezon City, where they actually stayed before their demise?

Rule 73, Section 1 of the Rules of Court states:

Where estate of deceased persons be settled. – If the decedent is an inhabitant of the Philippines at the time of his death, whether a citizen or an alien, his will shall be proved, or letters of administration granted, and his estate settled, in the Court of First Instance in the province in which he resides at the time of his death, and if he is an inhabitant of a foreign country, the Court of First Instance of any province in which he had estate.  The court first taking cognizance of the settlement of the estate of a decedent shall exercise jurisdiction to the exclusion of all other courts.  The jurisdiction assumed by a court, so far as it depends on the place of residence of the decedent, or of the location of his estate, shall not be contested in a suit or proceeding, except in an appeal from that court, in the original case, or when the want of jurisdiction appears on the record. (underscoring ours)

Clearly, the estate of an inhabitant of the Philippines shall be settled or letters of administration granted in the proper court located in the province where the decedent resides at the time of his death.

Petitioner Rodolfo invokes our ruling in the case of Eusebio v. Eusebio, et al., where we held that the situs of settlement proceedings shall be the place where the decedent had his permanent residence or domicile at the time of death.  In determining residence at the time of death, the following factors must be considered, namely, the decedent had: (a) capacity to choose and freedom of choice; (b) physical presence at the place chosen; and (c) intention to stay therein permanently. While it appears that the decedents in this case chose to be physically present in Quezon City for medical convenience, petitioner avers that they never adopted Quezon City as their permanent residence.

The contention lacks merit.

In the case at bar, there is substantial proof that the decedents have transferred to petitioner’s Quezon City residence.  Petitioner failed to sufficiently refute respondent’s assertion that their elderly parents stayed in his house for some three to four years before they died in the late 1980s. Furthermore, the decedents’ respective death certificates state that they were both residents of Quezon City at the time of their demise.  Significantly, it was petitioner himself who filled up his late mother’s death certificate.  To our mind, this unqualifiedly shows that at that time, at least, petitioner recognized his deceased mother’s residence to be Quezon City.  Moreover, petitioner failed to contest the entry in Ignacio’s death certificate, accomplished a year earlier by respondent. The recitals in the death certificates, which are admissible in evidence, were thus properly considered and presumed to be correct by the court a quo.  We agree with the appellate court’s observation that since the death certificates were accomplished even before petitioner and respondent quarreled over their inheritance, they may be relied upon to reflect the true situation at the time of their parents’ death. The death certificates thus prevailed as proofs of the decedents’ residence at the time of death, over the numerous documentary evidence presented by petitioner.  To be sure, the documents presented by petitioner pertained not to residence at the time of death, as required by the Rules of Court, but to permanent residence or domicile.  Both the settlement court and the Court of Appeals found that the decedents have been living with petitioner at the time of their deaths and for some time prior thereto.  We find this conclusion to be substantiated by the evidence on record.  A close perusal of the challenged decision shows that, contrary to petitioner’s assertion, the court below considered not only the decedents’ physical presence in Quezon City, but also other factors indicating that the decedents’ stay therein was more than temporary.  In the absence of any substantial showing that the lower courts’ factual findings stemmed from an erroneous apprehension of the evidence presented, the same must be held to be conclusive and binding upon this Court. It does not necessarily follow that the records of a person’s properties are kept in the place where he permanently resides.  Neither can it be presumed that a person’s properties can be found mostly in the place where he establishes his domicile.  It may be that he has his domicile in a place different from that where he keeps his records, or where he maintains extensive personal and business interests.  No generalizations can thus be formulated on the matter, as the question of where to keep records or retain properties is entirely dependent upon an individual’s choice and peculiarities. At any rate, petitioner is obviously splitting straws when he differentiates between venue in ordinary civil actions and venue in special proceedings.  In Raymond v. Court of Appeals and Bejer v. Court of Appeals, we ruled that venue for ordinary civil actions and that for special proceedings have one and the same meaning.  As thus defined, “residence”, in the context of venue provisions, means nothing more than a person’s actual residence or place of abode, provided he resides therein with continuity and consistency.] All told, the lower court and the Court of Appeals correctly held that venue for the settlement of the decedents’ intestate estate was properly laid in the Quezon City court.

Ocampo vs. Ocampo
G.R. No. 150707. 
April 14, 2004

Basic is the rule that the party making an allegation in a civil case has the burden of proving it by a preponderance of evidence.  In an action involving property, petitioners should rely on the strength of their own title and not on the alleged weakness of respondents’ claim.

A donation as a mode of acquiring ownership results in an effective transfer of title to the property from the donor to the donee. Petitioners stubbornly rely on the Acknowledgement of Co-ownership allegedly executed by Fidela in favor of her siblings.  What they overlook is the fact that at the time of the execution of the Acknowledgement -- assuming that its authenticity and due execution were proven -- the property had already been donated to Belen.  The Deed of Donation, which is the prior document, is clearly inconsistent with the document relied upon by petitioners.  We agree with the RTC’s ratiocination:

“On the claim of plaintiffs that defendant Fidela Ll. Ocampo herself made a written acknowledgement for her co-ownership over all the properties disputed with plaintiffs in this case, the same cannot be considered as a declaration against Fidela’s interest since the alleged acknowledgement was written and executed on 24 December 1985 when she was no longer the owner of the property as the year previous, on 13 January 1984, she had already donated all her properties to defendant Belen Ocampo-Barrito, so that, in effect, she had no more properties with which she can have an interest to declare against.”

As to the photographs presented by petitioners to bolster their claim of co-ownership, we affirm the CA’s disposition showing the flimsiness of their claim as follows:

“The other piece of documentary evidence presented by appellants really proved nothing.  The ancient photograph showing the spouses Chino Jose and Juana Llander Ocampo together with their ten children, simply proved that there was such a picture taking of the spouses with their children.  But the photograph does not prove communal ownership by appellants over the disputed parcels of land; neither does it prove that the said properties were indeed owned by the spouses Chino Jose and Juana Ocampo, and then later on transferred to and commonly owned by their children.  By the same token, the picture exhibited by appellant showing the name ‘Oniang Ocampo -- 1-15-61’ (or Apolonia Ocampo, one of the children of the spouses Chino Jose and Juana) engraved in the house or building, does not prove communal ownership of the properties in question.  At best, it is susceptible of various meanings, like: that of Oniang Ocampo was born on 1-15-61, or that she got married on that date, or that she was celebrating a special event on the date mentioned, or that she even died on the date mentioned.  And even assuming ex gratia argumenti, that the said engraving proved ownership over the disputed building, some such fact can only work to the prejudice of herein appellants.  Why?  Because it would mean that only Oniang (or Apolonia) was the owner of the building and that the building is not, therefore, a communal property of the children of the late spouses Chino Jose and Juana. 

Neither can we accept petitioners’ contention that co-ownership is shown by the fact that some of the children of Spouses Ocampo stayed, lived, and even put up businesses on the property.  The appellate court correctly found that since the litigants in this case were blood relatives, fraternal affection could have been a good motive that impelled either Belen or Fidela to allow petitioners to use the property.  Without any proof, however, co-ownership among the parties cannot be presumed.

Lee vs. RTC Quezon City
G.R. No. 146006. 
February 23, 2004.

It is clear that Juliana Ortañez, and her three sons, Jose, Rafael and Antonio, all surnamed Ortañez, invalidly entered into a memorandum of agreement extrajudicially partitioning the intestate estate among themselves, despite their knowledge that there were other heirs or claimants to the estate and before final settlement of the estate by the intestate court. Since the appropriation of the estate properties by Juliana Ortañez and her children (Jose, Rafael and Antonio Ortañez) was invalid, the subsequent sale thereof by Juliana and Jose to a third party (FLAG), without court approval, was likewise void.

An heir can sell his right, interest, or participation in the property under administration under Art. 533 of the Civil Code which provides that possession of hereditary property is deemed transmitted to the heir without interruption from the moment of death of the decedent. However, an heir can only alienate such portion of the estate that may be allotted to him in the division of the estate by the probate or intestate court after final adjudication, that is, after all debtors shall have been paid or the devisees or legatees shall have been given their shares. This means that an heir may only sell his ideal or undivided share in the estate, not any specific property therein. In the present case, Juliana Ortañez and Jose Ortañez sold specific properties of the estate (1,014 and 1,011 shares of stock in Philinterlife) in favor of petitioner FLAG. This they could not lawfully do pending the final adjudication of the estate by the intestate court because of the undue prejudice it would cause the other claimants to the estate, as what happened in the present case.

Juliana Ortañez and Jose Ortañez sold specific properties of the estate, without court approval. It is well-settled that court approval is necessary for the validity of any disposition of the decedent’s estate. In the early case of Godoy vs. Orellano, we laid down the rule that the sale of the property of the estate by an administrator without the order of the probate court is void and passes no title to the purchaser.

The subject properties therefore are under the jurisdiction of the probate court which according to our settled jurisprudence has the authority to approve any disposition regarding properties under administration. . . More emphatic is the declaration We made in Estate of Olave vs. Reyes (123 SCRA 767) where We stated that when the estate of the deceased person is already the subject of a testate or intestate proceeding, the administrator cannot enter into any transaction involving it without prior approval of the probate court.

Only recently, in Manotok Realty, Inc. vs. Court of Appeals (149 SCRA 174), We held that the sale of an immovable property belonging to the estate of a decedent, in a special proceedings, needs court approval. . . This pronouncement finds support in the previous case of Dolores Vda. De Gil vs. Agustin Cancio (14 SCRA 797) wherein We emphasized that it is within the jurisdiction of a probate court to approve the sale of properties of a deceased person by his prospective heirs before final adjudication. x x x

It being settled that property under administration needs the approval of the probate court before it can be disposed of, any unauthorized disposition does not bind the estate and is null and void. As early as 1921 in the case of Godoy vs. Orellano (42 Phil 347), We laid down the rule that a sale by an administrator of property of the deceased, which is not authorized by the probate court is null and void and title does not pass to the purchaser.

There is hardly any doubt that the probate court can declare null and void the disposition of the property under administration, made by private respondent, the same having been effected without authority from said court. It is the probate court that has the power to authorize and/or approve the sale (Section 4 and 7, Rule 89), hence, a fortiori, it is said court that can declare it null and void for as long as the proceedings had not been closed or terminated. To uphold petitioner’s contention that the probate court cannot annul the unauthorized sale, would render meaningless the power pertaining to the said court. (Bonga vs. Soler, 2 SCRA 755). (emphasis ours)

Our jurisprudence is therefore clear that (1) any disposition of estate property by an administrator or prospective heir pending final adjudication requires court approval and (2) any unauthorized disposition of estate property can be annulled by the probate court, there being no need for a separate action to annul the unauthorized disposition.

The question now is: can the intestate or probate court execute its order nullifying the invalid sale?

We see no reason why it cannot. The intestate court has the power to execute its order with regard to the nullity of an unauthorized sale of estate property, otherwise its power to annul the unauthorized or fraudulent disposition of estate property would be meaningless. In other words, enforcement is a necessary adjunct of the intestate or probate court’s power to annul unauthorized or fraudulent transactions to prevent the dissipation of estate property before final adjudication.

We are not dealing here with the issue of inclusion or exclusion of properties in the inventory of the estate because there is no question that, from the very start, the Philinterlife shares of stock were owned by the decedent, Dr. Juvencio Ortañez.  Rather, we are concerned here with the effect of the sale made by the decedent’s heirs, Juliana Ortañez and Jose Ortañez, without the required approval of the intestate court. This being so, the contention of petitioners that the determination of the intestate court was merely provisional and should have been threshed out in a separate proceeding is incorrect.

The petitioners Jose Lee and Alma Aggabao next contend that the writ of execution should not be executed against them because they were not notified, nor they were aware, of the proceedings nullifying the sale of the shares of stock.

We are not persuaded. The title of the purchaser like herein petitioner FLAG can be struck down by the intestate court after a clear showing of the nullity of the alienation. This is the logical consequence of our ruling in Godoy and in several subsequent cases. The sale of any property of the estate by an administrator or prospective heir without order of the probate or intestate court is void and passes no title to the purchaser. Thus, in Juan Lao et al. vs. Hon. Melencio Geneto, G.R. No. 56451, June 19, 1985, we ordered the probate court to cancel the transfer certificate of title issued to the vendees at the instance of the administrator after finding that the sale of real property under probate proceedings was made without the prior approval of the court.

It goes without saying that the increase in Philinterlife’s authorized capital stock, approved on the vote of petitioners’ non-existent shareholdings and obviously calculated to make it difficult for Dr. Ortañez’s estate to reassume its controlling interest in Philinterlife, was likewise void ab initio.

Speed Distributing Corp vs. CA G.R. No. 149351.  March 17, 2004

On September 20, 1953, Pastor Y. Lim married private respondent Rufina Luy Lim. During the early part of their marriage, Pastor organized some family corporations using their conjugal funds.  Among these corporations was Skyline International Corporation (Skyline, for brevity) which was engaged in the importation and sale of Hankook Brand Korean Tires and the acquisition of real estate. The couple were incorporators and major stockholders of the corporation and were also employed therein.

To determine whether a case involves an intra-corporate controversy, and is to be heard and decided by the Branches of the RTC specifically designated by the Court to try and decide such cases, two elements must concur: (a) the status or relationship of the parties; and (2) the nature of the question that is the subject of their controversy.

The first element requires that the controversy must arise out of intra-corporate or partnership relations between any or all of the parties and the corporation, partnership or association of which they are stockholders, members or associates; between any or all of them and the corporation, partnership or association of which they are stockholders, members or associates, respectively; and between such corporation, partnership or association and the State insofar as it concerns their individual franchises. The second element requires that the dispute among the parties be intrinsically connected with the regulation of the corporation. If the nature of the controversy involves matters that are purely civil in character, necessarily, the case does not involve an intra-corporate controversy. The determination of whether a contract is simulated or not is an issue that could be resolved by applying pertinent provisions of the Civil Code.

In the present recourse, it is clear that the private respondent’s complaint in the RTC is not an intra-corporate case.  For one thing, the private respondent has never been a stockholder of Leslim, or of Speed for that matter.  The complaint is one for the nullification of the deed of absolute sale executed by Leslim in favor of Speed over the property covered by TCT No. T-36617 in the name of Leslim, the cancellation of TCT No. T-116716 in the name of Speed, as well as the Secretary’s Certificate dated August 22, 1994. The private respondent alleged that since her deceased husband, Pastor Lim, acquired the property during their marriage, the said property is  conjugal in nature, although registered under the name of Leslim under TCT No. T-36617. She asserted that the petitioners connived to deprive the estate of Pastor Lim and his heirs of their possession and ownership over the said property using a falsified Secretary’s Certificate stating that the Board of Directors of Leslim had a meeting on August 19, 1995, when, in fact, no such meeting was held.  Petitioner Lita Lim was never a stockholder of Leslim or a member of its Board of Directors; her husband, petitioner Ireneo Marcelo was the Vice-President of Speed; and, petitioner Pedro Aquino was Leslim’s corporate secretary.  The private respondent further averred that the amount of P3,900,000.00,  the purchase price of the property under the deed of absolute sale, was not paid to Leslim, and that petitioners Spouses Marcelo and petitioner Pedro Aquino contrived the said deed to consummate their devious scheme and chicanery.  The private respondent concluded that the Deed of Absolute Sale was simulated; hence, null and void.

We are convinced that on the basis of the material allegations of the complaint, the court a quo had jurisdiction over the case.

The private respondent filed the complaint as one of the heirs of Pastor Lim, who died intestate on June 11, 1994. She was, in fact, the surviving spouse of the deceased, a compulsory heir by operation of law.  The general rule under the law on succession is that successional rights are transmitted from the moment of death of the decedent and compulsory heirs are called upon to succeed by operation of law to the inheritance without the need of further proceedings.  Under Article 776 of the New Civil Code, inheritance includes all the properties, rights and obligations of a party, not extinguished by his death. Although the private respondent was appointed by the probate court as a special administratrix of the estate of Pastor Lim, she had the right, apart from her being a special administratrix, to file the complaint against the petitioners for the nullification of the deed of absolute sale, and TCT Nos. T-36617 and T-116716. Indeed, in Emnace vs. Court of Appeals, et al, we held that:

On the third issue, petitioner asserts that the surviving spouse of Vicente Tabanao has no legal capacity to sue since she was never appointed as administratrix or executrix of his estate. Petitioner’s objection in this regard is misplaced. The surviving spouse does not need to be appointed as executrix or administratrix of the estate before she can file the action. She and her children are complainants in their own right as successors of Vicente Tabanao. From the very moment of Vicente Tabanao’s death, his rights insofar as the partnership was concerned were transmitted to his heirs, for rights to the succession are transmitted from the moment of death of the decedent.

Whatever claims and rights Vicente Tabanao had against the partnership and petitioner were transmitted to respondents by operation of law, more particularly by succession, which is a mode of acquisition by virtue of which the property, rights and obligations to the extent of the value of the inheritance of a person are transmitted. Moreover, respondents became owners of their respective hereditary shares from the moment Vicente Tabanao died.

A prior settlement of the estate, or even the appointment of Salvacion Tabanao as executrix or administratrix, is not necessary for any of the heirs to acquire legal capacity to sue.  As successors who stepped into the shoes of their decedent upon his death, they can commence any action originally pertaining to the decedent. From the moment of his death, his rights as a partner and to demand fulfillment of petitioner’s obligations as outlined in their dissolution agreement were transmitted to respondents. They, therefore, had the capacity to sue and seek the court’s intervention to compel petitioner to fulfill his obligations.

In her complaint, the private respondent sought the nullification of the Deed of Absolute Sale executed by Leslim Corporation in favor of Speed, as well as TCT No. T-36617 under its name. Thus, Leslim Corporation is an indispensable party, and should be impleaded as a party-defendant conformably to Section 7, Rule 3 of the Rules of Court, as amended.

SEC. 7. Compulsory joinder of indispensable parties.— Parties in interest without whom no final determination can be had of an action shall be joined either as plaintiffs or defendants.

As Leslim Corporation was a party to the deed, its interests in the subject of the action and the outcome thereof is such that the trial court could not proceed without its presence.  All actuations of the trial court subsequent to the filing of the complaint are null and void, not only as to Leslim Corporation, but also as to the present parties. All the compulsory heirs of the deceased must also be impleaded as plaintiffs, being indispensable parties. Thus, the private respondent needs to amend her complaint in the court a quo to include all indispensable parties; otherwise, her claim would be dismissed.

Pascual vs. Francisco-Alfonso G.R. No. 138774.  March 8, 2001

May a legitimate daughter be deprived of her share in the estate of her deceased father by a simulated contract transferring the property of her father to his illegitimate children?

We affirm the decision of the Court of Appeals because:

First:  The kasulatan was simulated.  There was no consideration for the contract of sale.  Felicitas de la Cruz, a family friend of the Franciscos, testified that Zenaida Pascual and Regina Francisco did not have any source of income in 1983, when they bought the property, until the time when Felicitas testified in 1991.

As proof of income, however, Zenaida Pascual testified that she was engaged in operating a canteen, working as cashier in Mayon Night Club as well as buying and selling RTW (Ready to Wear) items in August of 1983 and prior thereto.

Zenaida alleged that she paid her father the amount of P10,000.00.  She did not withdraw money from her bank account at the Rural Bank of Meycauayan, Bulacan, to pay for the property.  She had personal savings other than those deposited in the bank.  Her gross earnings from the RTW for three years was P9,000.00, and she earned P50.00 a night at the club.

Regina Francisco, on the other hand, was a market vendor, selling nilugaw, earning a net income of P300.00 a day in 1983.  She bought the property from the deceased for P15,000.00. She had no other source of income.

We find it incredible that engaging in buy and sell could raise the amount of P10,000.00, or that earnings in selling goto could save enough to pay P15,000.00, in cash for the land.

The testimonies of petitioners were incredible considering their inconsistent statements as to whether there was consideration for the sale and also as to whether the property was bought below or above its supposed market value.  They could not even present a single witness to the kasulatan that would prove receipt of the purchase price.

Since there was no cause or consideration for the sale, the same was a simulation and hence, null and void.

Second:  Even if the kasulatan was not simulated, it still violated the Civil Code provisions insofar as the transaction affected respondent’s legitime.  The sale was executed in 1983, when the applicable law was the Civil Code, not the Family Code.

Obviously, the sale was Gregorio’s way to transfer the property to his illegitimate daughters at the expense of his legitimate daughter.  The sale was executed to prevent respondent Alfonso from claiming her legitime and rightful share in said property.  Before his death, Gregorio had a change of heart and informed his daughter about the titles to the property.

According to Article 888, Civil Code: “The legitime of legitimate children and descendants consists of one-half of the hereditary estate of the father and of the mother.

“The latter may freely dispose of the remaining half subject to the rights of illegitimate children and of the surviving spouse as hereinafter provided.”

Gregorio Francisco did not own any other property.  If indeed the parcels of land involved were the only property left by their father, the sale in fact would deprive respondent of her share in her father’s estate.  By law, she is entitled to half of the estate of her father as his only legitimate child.

The legal heirs of the late Gregorio Francisco must be determined in proper testate or intestate proceedings for settlement of the estate.  His compulsory heir can not be deprived of her share in the estate save by disinheritance as prescribed by law.