Succession case 857-914 Creditsto james perez Page1 SECOND DIVISION G.R. No. L-27952 February 15, 1982 TESTATE ESTATE OF JOSE EUGENIO RAMIREZ, MARIA LUISA PALACIOS, Administratrix, petitioner-appellee,vs. MARCELLE D. VDA. DE RAMIREZ, ET AL., oppositors, JORGE and ROBERTO RAMIREZ, legatees, oppositors- appellants.

ABAD SANTOS, J .: The main issue in this appeal is the manner of partitioning the testate estate of Jose Eugenio Ramirez among the principal beneficiaries, namely: his widow Marcelle Demoron de Ramirez; his two grandnephews Roberto and Jorge Ramirez; and his companion Wanda de Wrobleski. The task is not trouble-free because the widow Marcelle is a French who lives in Paris, while the companion Wanda is an Austrian who lives in Spain. Moreover, the testator provided for substitutions. Jose Eugenio Ramirez, a Filipino national, died in Spain on December 11, 1964, with only his widow as compulsory heir. His will was admitted to probate by the Court of First Instance of Manila, Branch X, on July 27, 1965. Maria Luisa Palacios was appointed administratrix of the estate. In due time she submitted an inventory of the estate as follows: INVENTARIO Una sexta parte (1/6) proindiviso de un te rreno, con sus mejoras y edificaciones, situadoen la Escolta, Manila............................................................. P500,000.00 Una sexta parte (1/6) proindiviso de dos parcelas de terreno situadas en Antipolo, Rizal................... 658.34 Cuatrocientos noventa y uno (491) acciones de la 'Central Azucarera de la Carlota a P17.00 por accion ................................................................................8,347.00 Diez mil ochocientos seize (10,806) acciones de la 'Central Luzon Milling Co.', disuelta y en liquidacion a P0.15 por accion ..............................................1,620.90 Cuenta de Ahorros en el Philippine Trust Co.............................................................................................. 2,350.73 TOTAL.............................................................. P512,976.97 MENOS: Deuda al Banco de las Islas Filipinas, garan- Succession case 857-914 Creditsto james perez Page2 tizada con prenda de las acciones de La Carlota ......... P 5,000,00 VALOR LIQUIDO........................................... P507,976.97 The testamentary dispositions are as follows: A.En nuda propiedad, a D. Roberto y D. Jorge Ramirez, ambas menores de edad, residentes en Manila, I.F., calle 'Alright, No. 1818, Malate, hijos de su sobrino D. Jose Ma. Ramirez, con sustitucion vulgar a favor de sus respectivos descendientes, y, en su defecto, con sustitucion vulgar reciprocal entre ambos. El precedente legado en nuda propiedad de la participacion indivisa de la finca Santa Cruz Building, lo ordena el testador a favor de los legatarios nombrados, en atencion a que dicha propiedad fue creacion del querido padre del otorgante y por ser aquellos continuadores del apellido Ramirez, B.Y en usufructo a saber: a. En cuanto a una tercera parte, a favor de la esposa del testador, Da. Marcelle Ramirez, domiciliada en IE PECO, calle del General Gallieni No. 33, Seine Francia, con sustitucion vulgar u fideicomisaria a favor de Da. Wanda de Wrobleski, de Palma de Mallorca, Son Rapina Avenida de los Reyes 13, b.Y en cuanto a las dos terceras partes restantes, a favor de la nombrada Da. Wanda de Nrobleski con sustitucion vulgar v fideicomisaria a saber: En cuanto a la mitad de dichas dos terceras partes, a favor de D. Juan Pablo Jankowski, de Son Rapina Palma de Mallorca; y encuanto a la mitad restante, a favor de su sobrino, D. Horace V. Ramirez, San Luis Building, Florida St. Ermita, Manila, I.F. A pesar de las sustituciones fideiconiisarias precedentemente ordinadas, las usufiructuarias nombradas conjuntamente con los nudo propietarios, podran en cualquier memento vender a tercero los bienes objeto delegado, sin intervencion alguna de los titulares fideicomisaarios. On June 23, 1966, the administratrix submitted a project of partition as follows: the property of the deceased is to be divided into two parts. One part shall go to the widow 'en pleno dominio" in satisfaction of her legitime; the other part or "free portion" shall go to Jorge and Roberto Ramirez "en nuda propriedad." Furthermore, one third (1/3) of the free portion is charged with the widow's usufruct and the remaining two-thirds (2/3) with a usufruct in favor of Wanda. Jorge and Roberto opposed the project of partition on the grounds: (a) that the provisions for vulgar substitution in favor of Wanda de Wrobleski with respect to the widow's usufruct and in favor of Juan Pablo Jankowski and Horacio V. Ramirez, with respect to Wanda's usufruct are invalid because the first heirs Marcelle and Wanda) survived the testator; (b) that the provisions for fideicommissary substitutions are also invalid because the first heirs are not related to the second heirs or substitutes within the first degree, as provided in Article 863 of the Civil Code; (c) that the grant of a usufruct over real property in the Philippines in favor of Wanda Wrobleski, who is an alien, violates Section 5, Article III of the Philippine Constitution; and that (d) the proposed partition of the testator's interest in the Santa Cruz (Escolta) Building between the widow Marcelle and the appellants, violates the testator's express win to give this property to them Nonetheless, the lower court approved the project of partition in its order dated May 3, 1967. It is this order which Jorge and Roberto have appealed to this Court. 1. The widow's legitime. The appellant's do not question the legality of giving Marcelle one-half of the estate in full ownership. They admit that the testator's dispositions impaired his widow's legitime. Indeed, under Art. 900 of the Civil Code "If the only survivor is the widow or widower, she or he shall be entitled to one-half of the hereditary estate." And since Marcelle alone survived the deceased, she is entitled to one-half of his Succession case 857-914 Creditsto james perez Page3 estate over which he could impose no burden, encumbrance, condition or substitution of any kind whatsoever. (Art. 904, par. 2, Civil Code.) It is the one-third usufruct over the free portion which the appellants question and justifiably so. It appears that the court a quo approved the usufruct in favor of Marcelle because the testament provides for a usufruct in her favor of one-third of the estate. The court a quo erred for Marcelle who is entitled to one-half of the estate "en pleno dominio" as her legitime and which is more than what she is given under the will is not entitled to have any additional share in the estate. To give Marcelle more than her legitime will run counter to the testator's intention for as stated above his dispositions even impaired her legitime and tended to favor Wanda. 2. The substitutions. It may be useful to recall that "Substitution is the appoint- judgment of another heir so that he may enter into the inheritance in default of the heir originally instituted." (Art. 857, Civil Code. And that there are several kinds of substitutions, namely: simple or common, brief or compendious, reciprocal, and fideicommissary (Art. 858, Civil Code.) According to Tolentino, "Although the Code enumerates four classes, there are really only two principal classes of substitutions: the simple and the fideicommissary. The others are merely variations of these two." (111 Civil Code, p. 185 [1973].) The simple or vulgar is that provided in Art. 859 of the Civil Code which reads: ART. 859. The testator may designate one or more persons to substitute the heir or heirs instituted in case such heir or heirs should die before him, or should not wish, or should be incapacitated to accept the inheritance. A simple substitution, without a statement of the cases to which it refers, shall comprise the three mentioned in the preceding paragraph, unless the testator has otherwise provided. The fideicommissary substitution is described in the Civil Code as follows: ART. 863. A fideicommissary substitution by virtue of which the fiduciary or first heir instituted is entrusted with the obligation to preserve and to transmit to a second heir the whole or part of inheritance, shall be valid and shall take effect, provided such substitution does not go beyond one degree from the heir originally instituted, and provided further that the fiduciary or first heir and the second heir are living at time of the death of the testator. It will be noted that the testator provided for a vulgar substitution in respect of the legacies of Roberto and Jorge Ramirez, the appellants, thus: con sustitucion vulgar a favor de sus respectivos descendientes, y, en su defecto, con substitution vulgar reciprocal entre ambos. The appellants do not question the legality of the substitution so provided. The appellants question the sustitucion vulgar y fideicomisaria a favor de Da. Wanda de Wrobleski" in connection with the one-third usufruct over the estate given to the widow Marcelle However, this question has become moot because as We have ruled above, the widow is not entitled to any usufruct. The appellants also question the sustitucion vulgar y fideicomisaria in connection with Wanda's usufruct over two thirds of the estate in favor of Juan Pablo Jankowski and Horace v. Ramirez. They allege that the substitution in its vulgar aspect as void because Wanda survived the testator or stated differently because she did not predecease the testator. But dying before the testator is not the only case for vulgar substitution for it also includes refusal or incapacity to accept the inheritance as provided in Art. 859 of the Civil Code, supra. Hence, the vulgar substitution is valid. As regards the substitution in its fideicommissary aspect, the appellants are correct in their claim that it is void for the following reasons: Succession case 857-914 Creditsto james perez Page4 (a) The substitutes (Juan Pablo Jankowski and Horace V. Ramirez) are not related to Wanda, the heir originally instituted. Art. 863 of the Civil Code validates a fideicommissary substitution "provided such substitution does not go beyond one degree from the heir originally instituted." What is meant by "one degree" from the first heir is explained by Tolentino as follows: Scaevola Maura, and Traviesas construe "degree" as designation, substitution, or transmission. The Supreme Court of Spain has decidedly adopted this construction. From this point of view, there can be only one tranmission or substitution, and the substitute need not be related to the first heir. Manresa, Morell and Sanchez Roman, however, construe the word "degree" as generation, and the present Code has obviously followed this interpretation. by providing that the substitution shall not go beyond one degree "from the heir originally instituted." The Code thus clearly indicates that the second heir must be related to and be one generation from the first heir. From this, it follows that the fideicommissary can only be either a child or a parent of the first heir. These are the only relatives who are one generation or degree from the fiduciary (Op. cit., pp. 193-194.) (b) There is no absolute duty imposed on Wanda to transmit the usufruct to the substitutes as required by Arts. 865 and 867 of the Civil Code. In fact, the appellee admits "that the testator contradicts the establishment of a fideicommissary substitution when he permits the properties subject of the usufruct to be sold upon mutual agreement of the usufructuaries and the naked owners." (Brief, p. 26.) 3. The usufruct of Wanda. The appellants claim that the usufruct over real properties of the estate in favor of Wanda is void because it violates the constitutional prohibition against the acquisition of lands by aliens. The 1935 Constitution which is controlling provides as follows: SEC. 5. Save in cases of hereditary succession, no private agricultural land shall be transferred or assigned except to individuals, corporations, or associations qualified to acquire or hold lands of the public domain in the Philippines. (Art. XIII.) The court a quo upheld the validity of the usufruct given to Wanda on the ground that the Constitution covers not only succession by operation of law but also testamentary succession. We are of the opinion that the Constitutional provision which enables aliens to acquire private lands does not extend to testamentary succession for otherwise the prohibition will be for naught and meaningless. Any alien would be able to circumvent the prohibition by paying money to a Philippine landowner in exchange for a devise of a piece of land. This opinion notwithstanding, We uphold the usufruct in favor of Wanda because a usufruct, albeit a real right, does not vest title to the land in the usufructuary and it is the vesting of title to land in favor of aliens which is proscribed by the Constitution. IN VIEW OF THE FOREGOING, the estate of Jose Eugenio Ramirez is hereby ordered distributed as follows: One-half (1/2) thereof to his widow as her legitime; One-half (1/2) thereof which is the free portion to Roberto and Jorge Ramirez in naked ownership and the usufruct to Wanda de Wrobleski with a simple substitution in favor of Juan Pablo Jankowski and Horace V. Ramirez. The distribution herein ordered supersedes that of the court a quo. No special pronouncement as to costs. SO ORDERED. Succession case 857-914 Creditsto james perez Page5 Barredo (Chairman), Concepcion, Jr., De Castro, Ericta and Escolin, JJ., concur. Aquino J., took no part. PCIB vs. ESCOLIN 56 scra 266 Philippine Commercial and Industrial Bank, Administrator of the Testate Estate of Charles Newton Hodges, vs. Hon. Venicio Escolin (CFI-Iloilo) and Avelina A. Magno; Testate Estate of the late Linnie Jane Hodges. Testate Estate of the late Charles Newton Hodges. PCIB, administrator-appellant, vs. Lorenzo Carles, Jose Pablico, Alfredo Catedral, Salvador Guzman, Belcesar Causing, Florenia Barrido, Purificacion Coronado, Graciano Lucero, Ariteo Thomas Jamir, Melquiades Batisanan, Pepito Iyulores, Esperidion Partisala, Winifredo Espada, Rosario Alingasa, Adelfa Premaylon, Santiago Pacaonsis, and Avelina A. Magno, appellees, Western Institute of Technology, Inc., movant-appellee March 29, 1974; Barredo, J. *This case has the length of a PIL case. Court admitted several times that it was clueless as to some facts so it copied into the decision entire pleadings. (!!!)Plus, PCIB raised 78 assignment of errors! Well probably read the case again in Spec Pro. Short version: The Hodges lived in the Philippines for almost half a century and died leaving substantial properties in Iloilo and in the US. The missus died 5 years before the husband, providing in her will that while her estate would go to him, upon his death, the remainder should pass to her siblings. (They were childless.) The court held that this testamentary provision, while probably ineffectual as a substitution under the Civil Code, is not actually a substitution, but is a valid and simultaneous institution of heirs, though the passing of title to the inheritance to the others (the siblings) was made to depend on a resolutory condition (the husbands death). Case was remanded to the trial court for the determination of the proper application of the renvoi principle (conflict of laws between Philippines and Texas law), and the proper distribution of Linnies, Charles, and their conjugal estates. Facts: Charles Newton Hodges and Linnie Jane Hodges were originally from Texas, USA. During their marriage, they had acquired and accumulated considerable assets and properties in the Philippines and in Oklahoma and Texas in the US. They both lived, worked and were domiciled in Iloilo City for around 50 years. Before her death, Linnie Jane executed a will leaving her estate, less her debts and funeral expenses, to her husband Charles. Should Charles die, the will provided that the remainder of her estate go to her brothers and sisters, share and share alike. Should any of the brothers and sisters die before the husband, Linnie willed that the heirs of the said sibling be substituted in the deceaseds siblings place. When Linnie died, Charles took the will to probate court, and was appointed Executor, then later, Special Administrator. He moved to be allowed to continue administering the family business, as per Linnie Janes wishes, and to engage in sales, conveyances, leases, mortgages and other necessary transactions. He also filed the necessary and Succession case 857-914 Creditsto james perez Page6 appurtenant administration/accounting records, and income tax returns for the estate. Charles named seven brothers and sisters of Linnie Jane as her heirs (Esta, Emma, Leonard, Aline, David, Sadie, Era and Nimroy), but the order admitting the will to probate unfortunately omitted one of the heirs, Roy (Nimroy?) Higdon, so Charles filed a verified motion to have Roys name included. Asanexecutor,hewasboundtofiletaxreturnsfortheestatehewasadministering underAmericanlaw.HedidfilesuchasestatetaxreturnonAugust8,1958.In Schedule"M"of suchreturn,heanswered"Yes"tothequestion astowhetherhewas contemplating"renouncingthewill".Onthequestionastowhatpropertyinterests passed to him as the surviving spouse, he answered: None,exceptforpurposesofadministeringtheEstate,payingdebts,taxesand otherlegalcharges.Itistheintentionofthesurvivinghusbandofdeceasedto distributetheremainingpropertyandinterestsofthedeceasedintheir Community estate to the devisees and legatees named in the will when the debts, liabilities, taxes and expenses of administration are finally determined and paid. Charles died in Iloilo in December 1962 without having liquidated Linnies estate, which includeshershareintheconjugalpartnership.AlongtimeemployeeoftheHodges, AvelinaMagno,wasappointedAdministratrix(forLinniesestate)andaSpecial Administratrix(forCharles).Magnowasappointed,butlaterHaroldDavies (representativeofCharlesheirsintheUS)wasdesignatedCo-SpecialAdministrator, who was then replaced by one Joe Hodges, Charles nephew. One Atty. Mirasol was also appointedasco-administrator,andanorderofprobateandlettersofadministration were issued to Hodges and Mirasol. Atthispoint,theSCwasalreadyverymuchconfusedaboutthegapsinthefacts, convinced that the parties representing both estates had cooked up a modus operandi to settle money matters (a settlement with records the Court never saw)which, however, wentawry,withmoreandmoreheirsfromtheUSflockingtotheIloiloshores,and lawyers(Ozaetas!Mabantas!Manglapuses!)filingtheirrespectiveclaimsforretainer fees.Muchmuchlater,PCIBbecametheadministratorofCharlesestate,assertinga claimtoallofhisestate,includingthoseproperties/assetsthatpassedtohimupon LinnieJanesdeath.Avelinanaturallyopposedthis,asLinnieJanesotherheirs(the HIGDONS) would be prejudiced, so she continued acting in her capacity as administrator (enteringintosalesandothersuchconveyances).Fortheseacts,thePCIBdismissed herasanemployeeofCharlesestate,towhichsherespondedbylockingupthe premises being used by PCIB as offices, which were among the estates properties. PCIBs Claims Linnie Janes will should be governed by Philippine Law, with respect to the order of succession, the amount of successional rights, and the intrinsic validity of its testamentary provisions.Linnie intended Philippine laws to govern her Will. Article 16, CC, provides that "the national law of the person whose succession is under consideration, whatever may be the nature of the property and regardless Succession case 857-914 Creditsto james perez Page7 of the country wherein said property may be found", shall prevail. However, the Conflict of Law of Texas, which is the "national law" of the testatrix, Linnie Jane Hodges, provide that the domiciliary law (Philippine law) should govern the testamentary dispositions and successional rights over movables, and the law of the situs of the property (also Philippine law as to properties located in the Philippines) as regards immovables. Thus applying the "Renvoi Doctrine", as approved and applied in the Christensen case (1963), Philippine law should apply.Under Philippine and Texas law, the conjugal or community estate of spouses shall, upon dissolution, be divided equally between them. Thus, upon Linnies death, of the entirety of the assets of the Hodges spouses constituting their conjugal estate pertained automatically to Charles, not by way of inheritance, but in his own right as partner in the conjugal partnership.The other one-half (1/2) portion forming part of Linnies estate, cannot, under a clear and specific provision of her Will, be enhanced or increased by income, earnings, rents, or emoluments accruing after her death. All rents, emoluments and income from said estate shall belong to him (C. N. Hodges) and he is further authorized to use any part of the principal of said estate as he may need or desire."Articles 900, 995 and 1001 provide that the surviving spouse of a deceased leaving no ascendants or descendants is entitled, as a matter of right and by way of irrevocable legitime, to at least one-half (1/2) of the estate of the deceased, and no testamentary disposition by the deceased can legally and validly affect this right of the surviving spouse. In fact, her husband is entitled to said one-half (1/2) portion of her estate by way of legitime. (Article 886)Clearly, therefore, immediately upon the death of Linnie Jane Hodges, C. N. Hodges was the owner of at least 3/4 or 75% percent of all of the conjugal assets of the spouses, 50% by way of conjugal partnership share and 1/4 or 25% by way of inheritance and legitime) plus all "rents, emoluments and income" accruing to said conjugal estate from the moment of Linnie Jane Hodges' death. In his capacity as sole heir and successor to Linnies estate, Charles appropriated to himself the entirety of her estate. He operated all the assets, engaged in business and performed all acts in connection with the entirety of the conjugal estate, in his own name alone, just as he had been operating, engaging and doing while the late Linnie Jane Hodges was still alive. Upon his death on December 25, 1962, therefore, all said conjugal assets were in his sole possession and control, and registered in his name alone, not as executor, but as exclusive owner of all said assets. As the sole and exclusive heir, Charles did not need to liquidate the estate. Neither was there any asset left to Linnies estate at the time of Charles death, though Linnies estate may have referred to all of the rest, residue and remainder of my estate which would go to her siblings in the event of Charles death. The provision is thus void and invalid at least as to Philippine assets. There are generally only two kinds of substitution provided for and authorized by our Civil Code (Articles 857-870), namely, (1) simple or common substitution, sometimes referred to as vulgar substitution (Article 859), and (2) fideicommissary substitution (Article 863). All other substitutions are merely variations of these. The substitution provided for by paragraph four of the Will of Linnie Jane Hodges is not fideicommissary substitution, because there is clearly no obligation on the part of C. N. Hodges as the first heir designated, to preserve the properties for the substitute heirs. At most, it is a vulgar or simple substitution. However, in order that a vulgar orsimple substitution can be valid, three alternative conditions must be present, namely, that the first designated heir (1) should die before the testator; or (2) should not wish to accept the inheritance; or (3) should be incapacitated to do so. None of these conditions apply to C. N. Hodges, and, therefore, the substitution provided for by the above-quoted Succession case 857-914 Creditsto james perez Page8 provision of the Will is not authorized by the Code, and, therefore, it is void. Manresa even said, when another heir is designated to inherit upon the death of a first heir, the second designation can have effect only in case the first instituted heir dies before the testator, whether or not that was the true intention of said testator. The remedy of the Higdons, then, who are claiming dubious rights to of the conjugal estate of the Hodges, is to file a claim against the estate of Charles.It also follows that the conveyances executed by Avelina, claiming to be merely in continuation of the Hodges businesses, and which corresponding deeds of sale were confirmed by the probate court, are null and void and should be subject to reconveyance. Avelinas Claims (At one point, even Linnies heirs wanted to have Avelina removed from her capacity as administrator, but the lower court reversed its earlier grant of the motion, on account of a previous injunction it issued.) Linnie Jane merely gave Charles a life-estate or a usufruct over all her estate, and gave a vested remainder-estate or the naked title over the same estate, to her relatives.After Linnies death, Charles, as administrator and executor of the will, unequivocably and clearly through oral and written declarations and sworn public statements, renounced, disclaimed and repudiated his life-estate and usufruct. Since there was no separation or segregation of the interests of Linnie and Charles in the combined conjugal estate, as there has been no such separation or segregation, and because of Charles repudiation, both interests have continually earned exactly the same amount of rents, emoluments and income. Issue: 1. Is Linnies disposition in favor of her siblings void? NO 2. How should the estate be partitioned/liquidated? REMAND! Reasoning: 1. To a certain extent, PCIBs contention that Linnies testamentary substitution, when viewed as a substitution, may not be given effect, is correct. Indeed, legally speaking, Linnies will provides neither for a simple or vulgar substitution under Article 859 of the Civil Code nor for a fideicommissary substitution under Article 863 thereof. There is no vulgar substitution because there is no provision for either (1) predecease of the testator by the designated heir or (2) refusal or (3) incapacity of the latter to accept the inheritance, as required by Article 859; and neither is there a fideicommissary substitution therein because no obligation is imposed thereby upon Hodges to preserve the estate or any part thereof for anyone else. But from these premises, it is not correct to jump to the conclusion, as PCIB does, that the testamentary dispositions in question are therefore inoperative and invalid. The error in PCIB's position lies simply in the fact that it views the said disposition exclusively in the light of substitutions covered by the Civil Code section on that subject, (Section 3, Chapter 2, Title IV, Book III) when it is obvious that substitution occurs only when another heir is appointed in a will "so that he may enter into inheritance in default of the heir originally instituted," (Article 857) and, in the present case, no such possible default is contemplated. The brothers and sisters of Mrs. Hodges are not substitutes for Hodges because, under her will, they are not to inherit what Hodges cannot, would not or may not inherit, but what he would not dispose of from his inheritance; rather, Succession case 857-914 Creditsto james perez Page9 therefore, they are also heirs instituted simultaneously with Hodges, subject, however, to certain conditions, partially resolutory insofar as Hodges was concerned and correspondingly suspensive with reference to his brothers and sisters-in-law. It is partially resolutory, since it bequeaths unto Hodges the whole of her estate to be owned and enjoyed by him as universal and sole heir with absolute dominion over them only during his lifetime, which means that while he could completely and absolutely dispose of any portion thereof inter vivos to anyone other than himself, he was not free to do so mortis causa, and all his rights to what might remain upon his death would cease entirely upon the occurrence of that contingency, inasmuch as the right of his brothers and sisters-in-law to the inheritance, although vested already upon the death of Mrs. Hodges, would automatically become operative upon the occurrence of the death of Hodges in the event of actual existence of any remainder of her estate then. Contrary to Avelinas view, however, it was not the usufruct alone of Linnies estate, as contemplated in Article 869, that she bequeathed to Charles during his lifetime, but the full ownership thereof, although the same was to last also during his lifetime only, even as there was no restriction whatsoever against his disposing or conveying the whole or any portion thereof to anybody other than himself. The Court saw no legal impediment to this kind of institution, except that it cannot apply to the legitime of Charles as the surviving spouse, consisting of one-half of the estate, considering that Linnie had no surviving ascendants nor descendants. (Arts. 872, 900, and 904.) Hodges acts of administration and accounting strongly negate PCIBs claims that he had adjudicated to himself all of Linnies estate. While he may have used language like herein executor (being) the only devisee or legatee of the deceased, in accordance with the last will and testament already probated there is no other person interested in the Philippines of the time and place of examining herein account to be given notice, he wouldve known that doing so would impute bad faith unto him. Also, in his very motions, Hodges asserted the rights of Linnies named heirs. He even moved to include Roys name included in the probate courts order, lest Roys heirs think that they had been omitted. Thus, he recognized, in his own way, the separate identity of his wifes estate from his own share of the conjugal partnership up to the time of his death, more than 5 years after that of his wife. He never considered the whole estate as a single one belonging exclusively to himself. The only conclusion one can gather from this is that he could have been preparing the basis for the eventual transmission of his wife's estate, or, at least, so much thereof as he would not have been able to dispose of during his lifetime, to her brothers and sisters in accordance with her expressed desire, as intimated in his tax return in the US. And assuming that he did pay the corresponding estate and inheritance taxes in the Philippines on the basis of his being sole heir, such payment is not necessarily inconsistent with his recognition of the rights of his co-heirs. The Court thus viewed that under the peculiar provisions of his wife's will, and for purposes of the applicable inheritance tax laws, Hodges had to be considered as her sole heir, pending the actual transmission of the remaining portion of her estate to her other heirs, upon the eventuality of his death, and whatever adjustment might be warranted should there be any such remainder then is a matter that could well be taken care of by the internal revenue authorities in due time. The Court also considered as basis of Charles intentions several questionnaires in solemn forms in filing estate taxes abroad, though they have not been introduced in evidence (!!!), only referred to several times by the parties.Succession case 857-914 Creditsto james perez Page10 It is obvious, though, that Charles procrastinating in settling Linnies estate, and his sole administration of it, commingled his and his co-heirs interests, making it difficult to properly make an accounting of their shares. PCIB, then, cannot administer the properties on its own. What would be just and proper is for both administrators of the two estates to act conjointly until after said estates have been segregated from each other.2. The parties were in disagreement as to how Article 16 of the Civil Code should be applied. On the one hand, PCIB claimed that inasmuch as Linnie was a resident of the Philippines at the time of her death, under said Article 16, construed in relation to the pertinent laws of Texas and the principle of renvoi, what should be applied here should be the rules of succession under the Civil Code, and, therefore, her estate could consist of no more than one-fourth of the said conjugal properties, the other fourth being, as already explained, the legitime of her husband (Art. 900) which she could not have disposed of nor burdened with any condition (Art. 872). On the other hand, Avelina denied that Linnie died a resident of the Philippines, since allegedly she never changed nor intended to change her original residence of birth in Texas, United States of America, and contends that, anyway, regardless of the question of her residence, she being indisputably a citizen of Texas, under said Article 16 of the Civil Code, the distribution of her estate is subject to the laws of said State which, according to her, do not provide for any legitime, hence, Linnies brothers and sisters are entitled to the remainder of the whole of her share of the conjugal partnership properties consisting of one-half thereof. Avelina further maintained that, in any event, Charles had renounced his rights under the will in favor of his co-heirs, as allegedly proven by the documents touching on the point already mentioned earlier, the genuineness and legal significance of which PCIB questioned. The Court cannot decide on the claims, though, for neither the evidence submitted by the parties appeared to be adequate enough for it to render an intelligent comprehensive and just resolution. No clear and reliable proof of what in fact the possibly applicable laws of Texas are, was presented (Remember judicial notice in case of foreign laws?). Then also, the genuineness of documents relied upon by Avelina is disputed. In Justice, therefore, to all the parties concerned, these and all other relevant matters should first be threshed out fully in the trial court in the proceedings thereafter to be held for the purpose of ascertaining and adjudicating and/or distributing the estate of Mrs. Hodges to her heirs in accordance with her duly probated will. Linnies estate is the remainder of 1/4 of the conjugal partnership properties, considering that even PCIB did not maintain that the application of the laws of Texas would result in the other heirs of Mrs. Hodges not inheriting anything under her will. And since PCIB's representations in regard to the laws of Texas virtually constitute admissions of fact which the other parties and the Court are being made to rely and act upon, PCIB is not permitted to contradict them or subsequently take a position contradictory to or inconsistent with them. The only question that remains to be settled in the remand to the court below are:(1) whether or not the applicable laws of Texas do provide in effect for more, such as, when there is no legitime provided therein (2) whether or not Hodges has validly waived his whole inheritance from Mrs. Hodges. Succession case 857-914 Creditsto james perez Page11 In the course of the deliberations, it was brought out by some members of the Court that to avoid or, at least, minimize further protracted legal controversies between the respective heirs of the Hodges spouses, it is imperative to elucidate on the possible consequences of dispositions made by Charles after Linnies death, from the mass of the unpartitioned estates without any express indication in the pertinent documents as to whether his intention is to dispose of part of his inheritance from his wife or part of his own share of the conjugal estate as well as of those made by PCIB after the death of Hodges. After a long discussion, the consensus arrived at was as follows: (1) any such dispositions made gratuitously in favor of third parties, whether these be individuals, corporations or foundations, shall be considered as intended to be of properties constituting part of Hodges' inheritance from his wife, it appearing from the tenor of his motions of May 27 and December 11, 1957 that in asking for general authority to make sales or other disposals of properties under the jurisdiction of the court, which include his own share of the conjugal estate, he was not invoking particularly his right over his own share, but rather his right to dispose of any part of his inheritance pursuant to the will of his wife; (2) as regards sales, exchanges or other remunerative transfers, the proceeds of such sales or the properties taken in by virtue of such exchanges, shall be considered as merely the products of "physical changes" of the properties of her estate which the will expressly authorizes Hodges to make, provided that whatever of said products should remain with the estate at the time of the death of Hodges should go to her brothers and sisters;(3) the dispositions made by PCIB after the death of Hodges must naturally be deemed as covering only the properties belonging to his estate considering that being only the administrator of the estate of Hodges, PCIB could not have disposed of properties belonging to the estate of his wife. Neither could such dispositions be considered as involving conjugal properties, for the simple reason that the conjugal partnership automatically ceased when Linnie died, and by the peculiar provision of her will, under discussion, the remainder of her share descended also automatically upon the death of Hodges to her brothers and sisters, thus outside of the scope of PCIB's administration. Accordingly, these constructions of Linnies will should be adhered to by the trial court in its final order of adjudication and distribution and/or partition of the two estates in question. Disposition Remand for determination of proper application of Art. 16, CC (renvoi), and of Charles alleged renunciation of his ineritance under Linnies will. Avelina remains to be the administrator of Linnies estate. The said estate consists of of the community properties of the said spouses, as of the time of Linnies death on May 23, 1957, minus whatever the husband had already gratuitously disposed of in favor of third persons from said date until his death, provided, first, that with respect to remunerative dispositions, the proceeds thereof shall continue to be part of the wife's estate, unless subsequently disposed of gratuitously to third parties by the husband, and second, that should the purported renunciation be declared legally effective, no deductions whatsoever are to be made from said estate. PCIB and Avelina should act thenceforth always conjointly, never independently from each other, as administrators. Succession case 857-914 Creditsto james perez Page12 CONCURRING OPINIONS Fernandoconcurred with procedural aspect of the decision. Teehankeeagreed with most parts but had substantial differences in the reasoning: C. N. Hodges could not validly make gratuitous dispositions of any part or all of his wife's estate "completely and absolutely dispose of any portion thereof inter vivos to anyone other than himself" in the language of the main opinion and thereby render ineffectual and nugatory her institution of her brothers and sisters as her designated heirs to succeed to her whole estate "at the death of (her) husband." If according to the main opinion, Hodges could not make such gratuitous "complete and absolute dispositions" of his wife Linnie's estate "mortis causa," it would seem that by the same token and rationale he was likewise proscribed by the will from making such dispositions of Linnie's estate inter vivos. I believe that the two questions of renvoi and renunciation should be resolved preferentially and expeditiously by the probate court ahead of the partition and segregation of the minimum one-fourth of the conjugal or community properties constituting Linnie Jane Hodges' separate estate, which task considering that it is now seventeen (17) years since Linnie Jane Hodges' death and her conjugal estate with C. N. Hodges has remained unliquidated up to now might take a similar number of years to unravel with the numerous items, transactions and details of the sizable estates involved. Such partition of the minimum one-fourth would not be final, since if the two prejudicial questions of renvoi and renunciation were resolved favorably to Linnie's estate meaning to say that if it should be held that C. N. Hodges is not entitled to any legitime of her estate and at any rate he had totally renounced his inheritance under the will), then Linnie's estate would consist not only of the minimum one-fourth but one-half of the conjugal or community properties of the Hodges spouses, which would require again the partition and segregation of still another one-fourth of said properties to complete Linnie's separate estate. Justice Teehankee also drew up suggested guidelines for application in the probate court. Please see original case. Makalintal, CJ. Regardless of whether or not C. N. Hodges was entitled to a legitime in his deceased wife's estate which question, still to be decided by the said probate court, may depend upon what is the law of Texas and upon its applicability in the present case the said estate consists of one-half, not one-fourth, of the conjugal properties. There is neither a minimum of one-fourth nor a maximum beyond that. It is important to bear this in mind because the estate of Linnie Hodges consists of her share in the conjugal properties, is still under administration and until now has not been distributed by order of the court. Succession case 857-914 Creditsto james perez Page13 The reference in both the main and separate opinions to a one-fourth portion of the conjugal properties as Linnie Hodges minimum share is a misnomer and is evidently meant only to indicate that if her husband should eventually be declared entitled to a legitime, then the disposition made by Linnie Hodges in favor of her collateral relatives would be valid only as to one-half of her share, or one-fourth of the conjugal properties, since the remainder, which constitutes such legitime, would necessarily go to her husband in absolute ownership, unburdened by any substitution, term or condition, resolutory or otherwise. And until the estate is finally settled and adjudicated to the heirs who may be found entitled to it, the administration must continue to cover Linnie's entire conjugal share.

___________________________________- THIRD DIVISION [G.R. No. 113725. June 29, 2000] JOHNNY S. RABADILLA,[1] petitioner, vs. COURT OF APPEALS AND MARIA MARLENA[2] COSCOLUELLA Y BELLEZA VILLACARLOS, respondents. D E C I S I O N PURISIMA, J.: This is a petition for review of the decision of the Court of Appeals,[3] dated December 23, 1993, in CA-G.R. No. CV-35555, which set aside the decision of Branch 52 of the Regional Trial Court in Bacolod City, and ordered the defendants-appellees (including herein petitioner), as heirs of Dr. Jorge Rabadilla, to reconvey title over Lot No. 1392, together with its fruits and interests, to the estate of Aleja Belleza. The antecedent facts are as follows: In a Codicil appended to the Last Will and Testament of testatrix Aleja Belleza, Dr. Jorge Rabadilla, predecessor-in-interest of the herein petitioner, Johnny S. Rabadilla, was instituted as a devisee of 511, 855 square meters of that parcel of land surveyed as Lot No. 1392 of the Bacolod Cadastre. The said Codicil, which was duly probated and admitted in Special Proceedings No. 4046 before the then Court of First Instance of Negros Occidental, contained the following provisions: "FIRST I give, leave and bequeath the following property owned by me to Dr. Jorge Rabadilla resident of 141 P. Villanueva, Pasay City: (a) Lot No. 1392 of the Bacolod Cadastre, covered by Transfer Certificate of Title No. RT-4002 (10942), which is registered in my name according to the records of the Register of Deeds of Negros Occidental. Succession case 857-914 Creditsto james perez Page14 (b) That should Jorge Rabadilla die ahead of me, the aforementioned property and the rights which I shall set forth hereinbelow, shall be inherited and acknowledged by the children and spouse of Jorge Rabadilla. xxx FOURTH (a)....It is also my command, in this my addition (Codicil), that should I die and Jorge Rabadilla shall have already received the ownership of the said Lot No. 1392 of the Bacolod Cadastre, covered by Transfer Certificate of Title No. RT-4002 (10942), and also at the time that the lease of Balbinito G. Guanzon of the said lot shall expire, Jorge Rabadilla shall have the obligation until he dies, every year to give to Maria Marlina Coscolluela y Belleza, Seventy (75) (sic) piculs of Export sugar and Twenty Five (25) piculs of Domestic sugar, until the said Maria Marlina Coscolluela y Belleza dies. FIFTH (a) Should Jorge Rabadilla die, his heir to whom he shall give Lot No. 1392 of the Bacolod Cadastre, covered by Transfer Certificate of Title No. RT-4002 (10492), shall have the obligation to still give yearly, the sugar as specified in the Fourth paragraph of his testament, to Maria Marlina Coscolluela y Belleza on the month of December of each year. SIXTH I command, in this my addition (Codicil) that the Lot No. 1392, in the event that the one to whom I have left and bequeathed, and his heir shall later sell, lease, mortgage this said Lot, the buyer, lessee, mortgagee, shall have also the obligation to respect and deliver yearly ONE HUNDRED (100) piculs of sugar to Maria Marlina Coscolluela y Belleza, on each month of December, SEVENTY FIVE (75) piculs of Export and TWENTY FIVE (25) piculs of Domestic, until Maria Marlina shall die, lastly should the buyer, lessee or the mortgagee of this lot, not have respected my command in this my addition (Codicil), Maria Marlina Coscolluela y Belleza, shall immediately seize this Lot No. 1392 from my heir and the latter's heirs, and shall turn it over to my near desendants, (sic) and the latter shall then have the obligation to give the ONE HUNDRED (100) piculs of sugar until Maria Marlina shall die. I further command in this my addition (Codicil) that my heir and his heirs of this Lot No. 1392, that they will obey and follow that should they decide to sell, lease, mortgage, they cannot negotiate with others than my near descendants and my sister."[4] Pursuant to the same Codicil, Lot No. 1392 was transferred to the deceased, Dr. Jorge Rabadilla, and Transfer Certificate of Title No. 44498 thereto issued in his name. Dr. Jorge Rabadilla died in 1983 and was survived by his wife Rufina and children Johnny (petitioner), Aurora, Ofelia and Zenaida, all surnamed Rabadilla. On August 21, 1989, Maria Marlena Coscolluela y Belleza Villacarlos brought a complaint, docketed as Civil Case No. 5588, before Branch 52 of the Regional Trial Court in Bacolod City, against the above-mentioned heirs of Dr. Jorge Rabadilla, to enforce the provisions Succession case 857-914 Creditsto james perez Page15 of subject Codicil. The Complaint alleged that the defendant-heirs violated the conditions of the Codicil, in that: 1. Lot No. 1392 was mortgaged to the Philippine National Bank and the Republic Planters Bank in disregard of the testatrix's specific instruction to sell, lease, or mortgage only to the near descendants and sister of the testatrix. 2. Defendant-heirs failed to comply with their obligation to deliver one hundred (100) piculs of sugar (75 piculs export sugar and 25 piculs domestic sugar) to plaintiff Maria Marlena Coscolluela y Belleza from sugar crop years 1985 up to the filing of the complaint as mandated by the Codicil, despite repeated demands for compliance. 3. The banks failed to comply with the 6th paragraph of the Codicil which provided that in case of the sale, lease, or mortgage of the property, the buyer, lessee, or mortgagee shall likewise have the obligation to deliver 100 piculs of sugar per crop year to herein private respondent. The plaintiff then prayed that judgment be rendered ordering defendant-heirs to reconvey/return-Lot No. 1392 to the surviving heirs of the late Aleja Belleza, the cancellation of TCT No. 44498 in the name of the deceased, Dr. Jorge Rabadilla, and the issuance of a new certificate of title in the names of the surviving heirs of the late Aleja Belleza. On February 26, 1990, the defendant-heirs were declared in default but on March 28, 1990 the Order of Default was lifted, with respect to defendant Johnny S. Rabadilla, who filed his Answer, accordingly. During the pre-trial, the parties admitted that: On November 15, 1998, the plaintiff (private respondent) and a certain Alan Azurin, son-in-law of the herein petitioner who was lessee of the property and acting as attorney-in-fact of defendant-heirs, arrived at an amicable settlement and entered into a Memorandum of Agreement on the obligation to deliver one hundred piculs of sugar, to the following effect: "That for crop year 1988-89, the annuity mentioned in Entry No. 49074 of TCT No. 44489 will be delivered not later than January of 1989, more specifically, to wit: 75 piculs of 'A' sugar, and 25 piculs of 'B' sugar, or then existing in any of our names, Mary Rose Rabadilla y Azurin or Alan Azurin, during December of each sugar crop year, in Azucar Sugar Central; and, this is considered compliance of the annuity as mentioned, and in the same manner will compliance of the annuity be in the next succeeding crop years. That the annuity above stated for crop year 1985-86, 1986-87, and 1987-88, will be complied in cash equivalent of the number of piculs as mentioned therein and which is as herein agreed upon, taking into consideration the composite price of sugar during each sugar crop year, which is in the total amount of ONE HUNDRED FIVE THOUSAND PESOS (P105,000.00). Succession case 857-914 Creditsto james perez Page16 That the above-mentioned amount will be paid or delivered on a staggered cash installment, payable on or before the end of December of every sugar crop year, to wit: For 1985-86, TWENTY SIX THOUSAND TWO HUNDRED FIFTY (P26,250.00) Pesos, payable on or before December of crop year 1988-89; For 1986-87, TWENTY SIX THOUSAND TWO HUNDRED FIFTY (P26,250.00) Pesos, payable on or before December of crop year 1989-90; For 1987-88, TWENTY SIX THOUSAND TWO HUNDRED FIFTY (P26,250.00) Pesos, payable on or before December of crop year 1990-91; and For 1988-89, TWENTY SIX THOUSAND TWO HUNDRED FIFTY (P26,250.00) Pesos, payable on or before December of crop year 1991-92."[5] However, there was no compliance with the aforesaid Memorandum of Agreement except for a partial delivery of 50.80 piculs of sugar corresponding to sugar crop year 1988 -1989. On July 22, 1991, the Regional Trial Court came out with a decision, dismissing the complaint and disposing as follows: "WHEREFORE, in the light of the aforegoing findings, the Court finds that the action is prematurely filed as no cause of action against the defendants has as yet arose in favor of plaintiff. While there maybe the non-performance of the command as mandated exaction from them simply because they are the children of Jorge Rabadilla, the title holder/owner of the lot in question, does not warrant the filing of the present complaint. The remedy at bar must fall. Incidentally, being in the category as creditor of the left estate, it is opined that plaintiff may initiate the intestate proceedings, if only to establish the heirs of Jorge Rabadilla and in order to give full meaning and semblance to her claim under the Codicil. In the light of the aforegoing findings, the Complaint being prematurely filed is DISMISSED without prejudice. SO ORDERED."[6] On appeal by plaintiff, the First Division of the Court of Appeals reversed the decision of the trial court; ratiocinating and ordering thus: "Therefore, the evidence on record having established plaintiff-appellant's right to receive 100 piculs of sugar annually out of the produce of Lot No. 1392; defendants-appellee's obligation under Aleja Belleza's codicil, as heirs of the modal heir, Jorge Rabadilla, to deliver such amount of sugar to plaintiff-appellant; defendants-appellee's admitted non-compliance with said obligation since 1985; and, the punitive consequences enjoined by both the codicil and the Civil Code, of seizure of Lot No. 1392 and its reversion to the estate of Aleja Belleza in case of such non-compliance, this Court deems it proper to order the reconveyance of title over Lot No. 1392 from the estates of Jorge Rabadilla to the estate of Aleja Belleza. However, plaintiff-appellant must institute separate proceedings to re-open Aleja Belleza's estate, secure the Succession case 857-914 Creditsto james perez Page17 appointment of an administrator, and distribute Lot No. 1392 to Aleja Belleza's legal heirs in order to enforce her right, reserved to her by the codicil, to receive her legacy of 100 piculs of sugar per year out of the produce of Lot No. 1392 until she dies. Accordingly, the decision appealed from is SET ASIDE and another one entered ordering defendants-appellees, as heirs of Jorge Rabadilla, to reconvey title over Lot No. 1392, together with its fruits and interests, to the estate of Aleja Belleza. SO ORDERED."[7] Dissatisfied with the aforesaid disposition by the Court of Appeals, petitioner found his way to this Court via the present petition, contending that the Court of Appeals erred in ordering the reversion of Lot 1392 to the estate of the testatrix Aleja Belleza on the basis of paragraph 6 of the Codicil, and in ruling that the testamentary institution of Dr. Jorge Rabadilla is a modal institution within the purview of Article 882 of the New Civil Code. The petition is not impressed with merit. Petitioner contends that the Court of Appeals erred in resolving the appeal in accordance with Article 882 of the New Civil Code on modal institutions and in deviating from the sole issue raised which is the absence or prematurity of the cause of action. Petitioner maintains that Article 882 does not find application as there was no modal institution and the testatrix intended a mere simple substitution - i.e. the instituted heir, Dr. Jorge Rabadilla, was to be substituted by the testatrix's "near descendants" should the obligation to deliver the fruits to herein private respondent be not complied with. And since the testatrix died single and without issue, there can be no valid substitution and such testamentary provision cannot be given any effect. The petitioner theorizes further that there can be no valid substitution for the reason that the substituted heirs are not definite, as the substituted heirs are merely referred to as "near descendants" without a definite identity or reference as to who are the "near descendants" and therefore, under Articles 843[8] and 845[9] of the New Civil Code, the substitution should be deemed as not written. The contentions of petitioner are untenable. Contrary to his supposition that the Court of Appeals deviated from the issue posed before it, which was the propriety of the dismissal of the complaint on the ground of prematurity of cause of action, there was no such deviation. The Court of Appeals found that the private respondent had a cause of action against the petitioner. The disquisition made on modal institution was, precisely, to stress that the private respondent had a legally demandable right against the petitioner pursuant to subject Codicil; on which issue the Court of Appeals ruled in accordance with law. It is a general rule under the law on succession that successional rights are transmitted from the moment of death of the decedent[10] and compulsory heirs are called to succeed by operation of law. The legitimate children and descendants, in relation to their legitimate parents, and the widow or widower, are compulsory heirs.[11] Thus, the petitioner, his mother and sisters, as compulsory heirs of the instituted heir, Dr. Jorge Rabadilla, succeeded the latter by operation of law, without need of further proceedings, Succession case 857-914 Creditsto james perez Page18 and the successional rights were transmitted to them from the moment of death of the decedent, Dr. Jorge Rabadilla. Under Article 776 of the New Civil Code, inheritance includes all the property, rights and obligations of a person, not extinguished by his death. Conformably, whatever rights Dr. Jorge Rabadilla had by virtue of subject Codicil were transmitted to his forced heirs, at the time of his death. And since obligations not extinguished by death also form part of the estate of the decedent; corollarily, the obligations imposed by the Codicil on the deceased Dr. Jorge Rabadilla, were likewise transmitted to his compulsory heirs upon his death. In the said Codicil, testatrix Aleja Belleza devised Lot No. 1392 to Dr. Jorge Rabadilla, subject to the condition that the usufruct thereof would be delivered to the herein private respondent every year. Upon the death of Dr. Jorge Rabadilla, his compulsory heirs succeeded to his rights and title over the said property, and they also assumed his (decedent's) obligation to deliver the fruits of the lot involved to herein private respondent. Such obligation of the instituted heir reciprocally corresponds to the right of private respondent over the usufruct, the fulfillment or performance of which is now being demanded by the latter through the institution of the case at bar. Therefore, private respondent has a cause of action against petitioner and the trial court erred in dismissing the complaint below. Petitioner also theorizes that Article 882 of the New Civil Code on modal institutions is not applicable because what the testatrix intended was a substitution - Dr. Jorge Rabadilla was to be substituted by the testatrix's near descendants should there be noncompliance with the obligation to deliver the piculs of sugar to private respondent. Again, the contention is without merit. Substitution is the designation by the testator of a person or persons to take the place of the heir or heirs first instituted. Under substitutions in general, the testator may either (1) provide for the designation of another heir to whom the property shall pass in case the original heir should die before him/her, renounce the inheritance or be incapacitated to inherit, as in a simple substitution,[12] or (2) leave his/her property to one person with the express charge that it be transmitted subsequently to another or others, as in a fideicommissary substitution.[13] The Codicil sued upon contemplates neither of the two. In simple substitutions, the second heir takes the inheritance in default of the first heir by reason of incapacity, predecease or renunciation.[14] In the case under consideration, the provisions of subject Codicil do not provide that should Dr. Jorge Rabadilla default due to predecease, incapacity or renunciation, the testatrix's near descendants would substitute him. What the Codicil provides is that, should Dr. Jorge Rabadilla or his heirs not fulfill the conditions imposed in the Codicil, the property referred to shall be seized and turned over to the testatrix's near descendants. Neither is there a fideicommissary substitution here and on this point, petitioner is correct. In a fideicommissary substitution, the first heir is strictly mandated to preserve the property and to transmit the same later to the second heir.[15] In the case under consideration, the instituted heir is in fact allowed under the Codicil to alienate the Succession case 857-914 Creditsto james perez Page19 property provided the negotiation is with the near descendants or the sister of the testatrix. Thus, a very important element of a fideicommissary substitution is lacking; the obligation clearly imposing upon the first heir the preservation of the property and its transmission to the second heir. "Without this obligation to preserve clearly imposed by the testator in his will, there is no fideicommissary substitution."[16] Also, the near descendants' right to inherit from the testatrix is not definite. The property will only pass to them should Dr. Jorge Rabadilla or his heirs not fulfill the obligation to deliver part of the usufruct to private respondent. Another important element of a fideicommissary substitution is also missing here. Under Article 863, the second heir or the fideicommissary to whom the property is transmitted must not be beyond one degree from the first heir or the fiduciary. A fideicommissary substitution is therefore, void if the first heir is not related by first degree to the second heir.[17] In the case under scrutiny, the near descendants are not at all related to the instituted heir, Dr. Jorge Rabadilla. The Court of Appeals erred not in ruling that the institution of Dr. Jorge Rabadilla under subject Codicil is in the nature of a modal institution and therefore, Article 882 of the New Civil Code is the provision of law in point. Articles 882 and 883 of the New Civil Code provide: Art. 882. The statement of the object of the institution or the application of the property left by the testator, or the charge imposed on him, shall not be considered as a condition unless it appears that such was his intention. That which has been left in this manner may be claimed at once provided that the instituted heir or his heirs give security for compliance with the wishes of the testator and for the return of anything he or they may receive, together with its fruits and interests, if he or they should disregard this obligation. Art. 883. When without the fault of the heir, an institution referred to in the preceding article cannot take effect in the exact manner stated by the testator, it shall be complied with in a manner most analogous to and in conformity with his wishes. The institution of an heir in the manner prescribed in Article 882 is what is known in the law of succession as an institucion sub modo or a modal institution. In a modal institution, the testator states (1) the object of the institution, (2) the purpose or application of the property left by the testator, or (3) the charge imposed by the testator upon the heir.[18] A "mode" imposes an obligation upon the heir or legatee but it does not affect the efficacy of his rights to the succession.[19] On the other hand, in a conditional testamentary disposition, the condition must happen or be fulfilled in order for the heir to be entitled to succeed the testator. The condition suspends but does not obligate; and the mode obligates but does not suspend.[20] To some extent, it is similar to a resolutory condition.[21] From the provisions of the Codicil litigated upon, it can be gleaned unerringly that the testatrix intended that subject property be inherited by Dr. Jorge Rabadilla. It is likewise clearly worded that the testatrix imposed an obligation on the said instituted heir and his successors-in-interest to deliver one hundred piculs of sugar to the herein private respondent, Marlena Coscolluela Belleza, during the lifetime of the latter. However, the Succession case 857-914 Creditsto james perez Page20 testatrix did not make Dr. Jorge Rabadilla's inheritance and the effectivity of his institution as a devisee, dependent on the performance of the said obligation. It is clear, though, that should the obligation be not complied with, the property shall be turned over to the testatrix's near descendants. The manner of institution of Dr. Jorge Rabadilla under subject Codicil is evidently modal in nature because it imposes a charge upon the instituted heir without, however, affecting the efficacy of such institution. Then too, since testamentary dispositions are generally acts of liberality, an obligation imposed upon the heir should not be considered a condition unless it clearly appears from the Will itself that such was the intention of the testator. In case of doubt, the institution should be considered as modal and not conditional.[22] Neither is there tenability in the other contention of petitioner that the private respondent has only a right of usufruct but not the right to seize the property itself from the instituted heir because the right to seize was expressly limited to violations by the buyer, lessee or mortgagee. In the interpretation of Wills, when an uncertainty arises on the face of the Will, as to the application of any of its provisions, the testator's intention is to be ascertained from the words of the Will, taking into consideration the circumstances under which it was made.[23] Such construction as will sustain and uphold the Will in all its parts must be adopted.[24] Subject Codicil provides that the instituted heir is under obligation to deliver One Hundred (100) piculs of sugar yearly to Marlena Belleza Coscuella. Such obligation is imposed on the instituted heir, Dr. Jorge Rabadilla, his heirs, and their buyer, lessee, or mortgagee should they sell, lease, mortgage or otherwise negotiate the property involved. The Codicil further provides that in the event that the obligation to deliver the sugar is not respected, Marlena Belleza Coscuella shall seize the property and turn it over to the testatrix's near descendants. The non-performance of the said obligation is thus with the sanction of seizure of the property and reversion thereof to the testatrix's near descendants. Since the said obligation is clearly imposed by the testatrix, not only on the instituted heir but also on his successors-in-interest, the sanction imposed by the testatrix in case of non-fulfillment of said obligation should equally apply to the instituted heir and his successors-in-interest. Similarly unsustainable is petitioner's submission that by virtue of the amicable settlement, the said obligation imposed by the Codicil has been assumed by the lessee, and whatever obligation petitioner had become the obligation of the lessee; that petitioner is deemed to have made a substantial and constructive compliance of his obligation through the consummated settlement between the lessee and the private respondent, and having consummated a settlement with the petitioner, the recourse of the private respondent is the fulfillment of the obligation under the amicable settlement and not the seizure of subject property. Suffice it to state that a Will is a personal, solemn, revocable and free act by which a person disposes of his property, to take effect after his death.[25] Since the Will expresses the manner in which a person intends how his properties be disposed, the wishes and desires of the testator must be strictly followed. Thus, a Will cannot be the Succession case 857-914 Creditsto james perez Page21 subject of a compromise agreement which would thereby defeat the very purpose of making a Will. WHEREFORE, the petition is hereby DISMISSED and the decision of the Court of Appeals, dated December 23, 1993, in CA-G.R. No. CV-35555 AFFIRMED. No pronouncement as to costs SO ORDERED. Melo, J., (Chairman), concur in the separate opinion of Justice Vitug. Vitug, J., see separate opinion. Panganiban, J., join the separate opinion of Justice Vitug. Gonzaga-Reyes, J., no part. _________________________________________________________________-- FIRST DIVISION G.R. No. L-40789 February 27, 1987 INTESTATE ESTATE OF PETRA V. ROSALES, IRENEA C. ROSALES, petitioner,vs. FORTUNATO ROSALES, MAGNA ROSALES ACEBES, MACIKEQUEROX ROSALES and ANTONIO ROSALES, respondents. Jose B. Echaves for petitioner. Jose A. Binghay and Paul G. Gorres for respondents.

GANCAYCO, J .: In this Petition for Review of two (2) Orders of the Court of First Instance of Cebu the question raised is whether the widow whose husband predeceased his mother can inherit from the latter, her mother-in-law. It appears from the record of the case that on February 26, 1971, Mrs. Petra V. Rosales, a resident of Cebu City, died intestate. She was survived by her husband Fortunate T. Rosales and their two (2) children Magna Rosales Acebes and Antonio Rosales. Another child, Carterio Rosales, predeceased her, leaving behind a child, Macikequerox Rosales, and his widow Irenea C. Rosales, the herein petitioner. The estate of the dismissed has an estimated gross value of about Thirty Thousand Pesos (P30,000.00). On July 10, 1971, Magna Rosales Acebes instituted the proceedings for the settlement of the estate of the deceased in the Court of First Instance of Cebu. The case was docketed as Special Proceedings No. 3204-R. Thereafter, the trial court appointed Magna Rosales Acebes administratrix of the said estate. In the course of the intestate proceedings, the trial court issued an Order dated June 16, 1972 declaring the following in individuals the legal heirs of the deceased and prescribing their respective share of the estate Succession case 857-914 Creditsto james perez Page22 Fortunata T. Rosales (husband), 1/4; Magna R. Acebes (daughter), 1/4; Macikequerox Rosales, 1/4; and Antonio Rosales son, 1/4. This declaration was reiterated by the trial court in its Order I dated February 4, 1975. These Orders notwithstanding, Irenea Rosales insisted in getting a share of the estate in her capacity as the surviving spouse of the late Carterio Rosales, son of the deceased, claiming that she is a compulsory heir of her mother-in-law together with her son, Macikequerox Rosales. Thus, Irenea Rosales sought the reconsideration of the aforementioned Orders. The trial court denied her plea. Hence this petition. In sum, the petitioner poses two (2) questions for Our resolution petition. First is a widow (surviving spouse) an intestate heir of her mother-in-law? Second are the Orders of the trial court which excluded the widow from getting a share of the estate in question final as against the said widow? Our answer to the first question is in the negative. Intestate or legal heirs are classified into two (2) groups, namely, those who inherit by their own right, and those who inherit by the right of representation. 1 Restated, an intestate heir can only inherit either by his own right, as in the order of intestate succession provided for in the Civil Code, 2 or by the right of representation provided for in Article 981 of the same law. The relevant provisions of the Civil Code are: Art. 980. The children of the deceased shall always inherit from him in their own right, dividing the inheritance in equal shares. Art. 981. Should children of the deceased and descendants of other children who are dead, survive, the former shall inherit in their own right, and the latter by right of representation. Art. 982. The grandchildren and other descendants shag inherit by right of representation, and if any one of them should have died, leaving several heirs, the portion pertaining to him shall be divided among the latter in equal portions. Art. 999. When the widow or widower survives with legitimate children or their descendants and illegitimate children or their descendants, whether legitimate or illegitimate, such widow or widower shall be entitled to the same share as that of a legitimate child. There is no provision in the Civil Code which states that a widow (surviving spouse) is an intestate heir of her mother-in-law. The entire Code is devoid of any provision which entitles her to inherit from her mother-in- law either by her own right or by the right of representation. The provisions of the Code which relate to the order of intestate succession (Articles 978 to 1014) enumerate with meticulous exactitude the intestate heirs of a decedent, with the State as the final intestate heir. The conspicuous absence of a provision which makes a daughter-in-law an intestate heir of the deceased all the more confirms Our observation. If the legislature intended to make the surviving spouse an intestate heir of the parent-in-law, it would have so provided in the Code. Petitioner argues that she is a compulsory heir in accordance with the provisions of Article 887 of the Civil Code which provides that: Art. 887. The following are compulsory heirs: (1) Legitimate children and descendants, with respect to their legitimate parents and ascendants; (2) In default of the foregoing, legitimate parents and ascendants, with respect to their legitimate children and descendants; (3) The widow or widower; Succession case 857-914 Creditsto james perez Page23 (4) Acknowledged natural children, and natural children by legal fiction; (5) Other illegitimate children referred to in article 287; Compulsory heirs mentioned in Nos. 3, 4 and 5 are not excluded by those in Nos. 1 and 2; neither do they exclude one another. In all cases of illegitimate children, their filiation must be duly proved. The father or mother of illegitimate children of the three classes mentioned, shall inherit from them in the manner and to the extent established by this Code. The aforesaid provision of law 3 refers to the estate of the deceased spouse in which case the surviving spouse (widow or widower) is a compulsory heir. It does not apply to the estate of a parent-in-law. Indeed, the surviving spouse is considered a third person as regards the estate of the parent-in-law. We had occasion to make this observation in Lachenal v. Salas, 4 to Wit: We hold that the title to the fishing boat should be determined in Civil Case No. 3597 (not in the intestate proceeding) because it affects the lessee thereof, Lope L. Leoncio, the decedent's son-in-law, who, although married to his daughter or compulsory heir, is nevertheless a third person with respect to his estate. ... (Emphasis supplied). By the same token, the provision of Article 999 of the Civil Code aforecited does not support petitioner's claim. A careful examination of the said Article confirms that the estate contemplated therein is the estate of the deceased spouse. The estate which is the subject matter of the intestate estate proceedings in this case is that of the deceased Petra V. Rosales, the mother-in-law of the petitioner. It is from the estate of Petra V. Rosales that Macikequerox Rosales draws a share of the inheritance by the right of representation as provided by Article 981 of the Code. The essence and nature of the right of representation is explained by Articles 970 and 971 of the Civil Code, viz Art. 970. Representation is a right created by fiction of law, by virtue of which the representative is raised to the place and the degree of the person represented, and acquires the rights which the latter would have if he were living or if he could have inherited. Art. 971. The representative is called to the succession by the law and not by the person represented. The representative does not succeed the person represented but the one whom the person represented would have succeeded. (Emphasis supplied.) Article 971 explicitly declares that Macikequerox Rosales is called to succession by law because of his blood relationship. He does not succeed his father, Carterio Rosales (the person represented) who predeceased his grandmother, Petra Rosales, but the latter whom his father would have succeeded. Petitioner cannot assert the same right of representation as she has no filiation by blood with her mother-in-law. Petitioner however contends that at the time of the death of her husband Carterio Rosales he had an inchoate or contingent right to the properties of Petra Rosales as compulsory heir. Be that as it may, said right of her husband was extinguished by his death that is why it is their son Macikequerox Rosales who succeeded from Petra Rosales by right of representation. He did not succeed from his deceased father, Carterio Rosales. On the basis of the foregoing observations and conclusions, We find it unnecessary to pass upon the second question posed by the petitioner. Accordingly, it is Our considered opinion, and We so hold, that a surviving spouse is not an intestate heir of his or her parent-in-law. Succession case 857-914 Creditsto james perez Page24 WHEREFORE, in view of the foregoing, the Petition is hereby DENIED for lack of merit, with costs against the petitioner. Let this case be remanded to the trial-court for further proceedings. SO ORDERED. Yap (Chairman), Narvasa, Melencio-Herrera, Cruz, Feliciano and Sarmiento, JJ., concur. EN BANC

G.R. No. L-30977 January 31, 1972 CARMEN LAPUZ SY, represented by her substitute MACARIO LAPUZ, petitioner-appellant,vs. EUFEMIO S. EUFEMIO alias EUFEMIO SY UY, respondent-appellee. Jose W. Diokno for petitioner-appellant. D. G. Eufemio for respondent-appellee. REYES J.B.L., J .:p Petition, filed after the effectivity of Republic Act 5440, for review by certiorari of an order, dated 29 July 1969, of the Juvenile and Domestic Relations Court of Manila, in its Civil Case No. 20387, dismissing said case for legal separation on the ground that the death of the therein plaintiff, Carmen O. Lapuz Sy, which occurred during the pendency of the case, abated the cause of action as well as the action itself. The dismissal order was issued over the objection of Macario Lapuz, the heir of the deceased plaintiff (and petitioner herein) who sought to substitute the deceased and to have the case prosecuted to final judgment. On 18 August 1953, Carmen O. Lapuz Sy filed a petition for legal separation against Eufemio S. Eufemio, alleging, in the main, that they were married civilly on 21 September 1934 and canonically on 30 September 1934; that they had lived together as husband and wife continuously until 1943 when her husband abandoned her; that they had no child; that they acquired properties during their marriage; and that she discovered her husband cohabiting with a Chinese woman named Go Hiok at 1319 Sisa Street, Manila, on or about March 1949. She prayed for the issuance of a decree of legal separation, which, among others, would order that the defendant Eufemio S. Eufemio should be deprived of his share of the conjugal partnership profits. In his second amended answer to the petition, herein respondent Eufemio S. Eufemio alleged affirmative and special defenses, and, along with several other claims involving money and other properties, counter-claimed for the declaration of nullity ab initio of his marriage with Carmen O. Lapuz Sy, on the ground of his prior and subsisting marriage, celebrated according to Chinese law and customs, with one Go Hiok, alias Ngo Hiok. Issues having been joined, trial proceeded and the parties adduced their respective evidence. But before the trial could be completed (the respondent was already scheduled to present surrebuttal evidence on 9 and 18 June 1969), petitioner Carmen O. Lapuz Sy died in a vehicular accident on 31 May 1969. Counsel for petitioner duly notified the court of her death. On 9 June 1969, respondent Eufemio moved to dismiss the "petition for legal separation" 1 on two (2) grounds, namely: that the petition for legal separation was filed beyond the one-year period provided for in Article 102 of the Civil Code; and that the death of Carmen abated the action for legal separation. On 26 June 1969, counsel for deceased petitioner moved to substitute the deceased Carmen by her father, Macario Lapuz. Counsel for Eufemio opposed the motion. On 29 July 1969, the court issued the order under review, dismissing the case. 2 In the body of the order, the court stated that the motion to dismiss and the motion for substitution had to be resolved on the question of whether or not the plaintiff's cause of action has survived, which the court resolved in the negative. Petitioner's moved to reconsider but the motion was denied on 15 September 1969. After first securing an extension of time to file a petition for review of the order of dismissal issued by the juvenile and domestic relations court, the petitioner filed the present petition on 14 October 1969. The same was given due course and answer thereto was filed by respondent, who prayed for the affirmance of the said order. 3 Although the defendant below, the herein respondent Eufemio S. Eufemio, filed counterclaims, he did not pursue them after the court below dismissed the case. He acquiesced in the dismissal of said counterclaims by praying for the affirmance of the order that dismissed not only the petition for legal Succession case 857-914 Creditsto james perez Page25 separation but also his counterclaim to declare the Eufemio-Lapuz marriage to be null and void ab initio. But petitioner Carmen O. Lapuz Sy (through her self-assumed substitute for the lower court did not act on the motion for substitution) stated the principal issue to be as follows: When an action for legal separation is converted by the counterclaim into one for a declaration of nullity of a marriage, does the death of a party abate the proceedings? The issue as framed by petitioner injects into it a supposed conversion of a legal separation suit to one for declaration of nullity of a marriage, which is without basis, for even petitioner asserted that "the respondent has acquiesced to the dismissal of his counterclaim" (Petitioner's Brief, page 22). Not only this. The petition for legal separation and the counterclaim to declare the nullity of the self same marriage can stand independent and separate adjudication. They are not inseparable nor was the action for legal separation converted into one for a declaration of nullity by the counterclaim, for legal separation pre-supposes a valid marriage, while the petition for nullity has a voidable marriage as a pre-condition. The first real issue in this case is: Does the death of the plaintiff before final decree, in an action for legal separation, abate the action? If it does, will abatement also apply if the action involves property rights? . An action for legal separation which involves nothing more than the bed-and-board separation of the spouses (there being no absolute divorce in this jurisdiction) is purely personal. The Civil Code of the Philippines recognizes this in its Article 100, by allowing only the innocent spouse (and no one else) to claim legal separation; and in its Article 108, by providing that the spouses can, by their reconciliation, stop or abate the proceedings and even rescind a decree of legal separation already rendered. Being personal in character, it follows that the death of one party to the action causes the death of the action itself actio personalis moritur cum persona. ... When one of the spouses is dead, there is no need for divorce, because the marriage is dissolved. The heirs cannot even continue the suit, if the death of the spouse takes place during the course of the suit (Article 244, Section 3). The action is absolutely dead (Cass., July 27, 1871, D. 71. 1. 81; Cass. req., May 8, 1933, D. H. 1933, 332.") 4 . Marriage is a personal relation or status, created under the sanction of law, and an action for divorce is a proceeding brought for the purpose of effecting a dissolution of that relation. The action is one of a personal nature. In the absence of a statute to the contrary, the death of one of the parties to such action abates the action, for the reason that death has settled the question of separation beyond all controversy and deprived the court of jurisdiction, both over the persons of the parties to the action and of the subject-matter of the action itself. For this reason the courts are almost unanimous in holding that the death of either party to a divorce proceeding, before final decree, abates the action. 1 Corpus Juris, 208; Wren v. Moss, 2 Gilman, 72; Danforth v. Danforth, 111 Ill. 236; Matter of Grandall, 196 N.Y. 127, 89 N.E. 578; 134 Am St. Rep. 830; 17 Ann. Cas. 874; Wilcon v. Wilson, 73 Mich, 620, 41 N.W. 817; Strickland v. Strickland, 80 Ark. 452, 97 S. W. 659; McCurley v. McCurley, 60 Md. 185, 45 Am. Rep. 717; Begbie v. Begbie, 128 Cal. 155, 60 Pac. 667, 49 L.R.A. 141. 5 The same rule is true of causes of action and suits for separation and maintenance (Johnson vs. Bates, Ark. 101 SW 412; 1 Corpus Juris 208). A review of the resulting changes in property relations between spouses shows that they are solely the effect of the decree of legal separation; hence, they can not survive the death of the plaintiff if it occurs prior to the decree. On the point, Article 106 of the Civil Code provides: . Art. 106. The decree of legal separation shall have the following effects: (1) The spouses shall be entitled to live separately from each other, but the marriage bonds shall not be severed; . (2) The conjugal partnership of gains or the absolute conjugal community of property shall be dissolved and liquidated, but the offending spouse shall have no right to any share of the profits earned by the partnership or community, without prejudice to the provisions of article 176; (3) The custody of the minor children shall be awarded to the innocent spouse, unless otherwise directed by the court in the interest of said minors, for whom said court may appoint a guardian; (4) The offending spouse shall be disqualified from inheriting from the innocent spouse by intestate succession. Moreover, provisions in favor of the offending spouse made in the will of the innocent one shall be revoked by operation of law. Succession case 857-914 Creditsto james perez Page26 From this article it is apparent that the right to the dissolution of the conjugal partnership of gains (or of the absolute community of property), the loss of right by the offending spouse to any share of the profits earned by the partnership or community, or his disqualification to inherit by intestacy from the innocent spouse as well as the revocation of testamentary provisions in favor of the offending spouse made by the innocent one, are all rights and disabilities that, by the very terms of the Civil Code article, are vested exclusively in the persons of the spouses; and by their nature and intent, such claims and disabilities are difficult to conceive as assignable or transmissible. Hence, a claim to said rights is not a claim that "is not thereby extinguished" after a party dies, under Section 17, Rule 3, of the Rules of Court, to warrant continuation of the action through a substitute of the deceased party. Sec. 17. Death of party. After a party dies and the claim is not thereby extinguished, the court shall order, upon proper notice, the legal representative of the deceased to appear and to be substituted for the deceased, within a period of thirty (30) days, or within such time as may be granted... The same result flows from a consideration of the enumeration of the actions that survive for or against administrators in Section 1, Rule 87, of the Revised Rules of Court: SECTION 1. Actions which may and which may not be brought against executor or administrator. No action upon a claim for the recovery of money or debt or interest thereon shall be commenced against the executor or administrator; but actions to recover real or personal property, or an interest therein, from the estate, or to enforce a lien thereon, and actions to recover damages for an injury to person or property, real or personal, may be commenced against him. Neither actions for legal separation or for annulment of marriage can be deemed fairly included in the enumeration.. A further reason why an action for legal separation is abated by the death of the plaintiff, even if property rights are involved, is that these rights are mere effects of decree of separation, their source being the decree itself; without the decree such rights do not come into existence, so that before the finality of a decree, these claims are merely rights in expectation. If death supervenes during the pendency of the action, no decree can be forthcoming, death producing a more radical and definitive separation; and the expected consequential rights and claims would necessarily remain unborn. As to the petition of respondent-appellee Eufemio for a declaration of nullity ab initio of his marriage to Carmen Lapuz, it is apparent that such action became moot and academic upon the death of the latter, and there could be no further interest in continuing the same after her demise, that automatically dissolved the questioned union. Any property rights acquired by either party as a result of Article 144 of the Civil Code of the Philippines 6 could be resolved and determined in a proper action for partition by either the appellee or by the heirs of the appellant. In fact, even if the bigamous marriage had not been void ab initio but only voidable under Article 83, paragraph 2, of the Civil Code, because the second marriage had been contracted with the first wife having been an absentee for seven consecutive years, or when she had been generally believed dead, still the action for annulment became extinguished as soon as one of the three persons involved had died, as provided in Article 87, paragraph 2, of the Code, requiring that the action for annulment should be brought during the lifetime of any one of the parties involved. And furthermore, the liquidation of any conjugal partnership that might have resulted from such voidable marriage must be carried out "in the testate or intestate proceedings of the deceased spouse", as expressly provided in Section 2 of the Revised Rule 73, and not in the annulment proceeding. ACCORDINGLY, the appealed judgment of the Manila Court of Juvenile and Domestic Relations is hereby affirmed. No special pronouncement as to costs. Concepcion, C.J., Makalintal, Zaldivar, Castro, Fernando, Teehankee, Barredo, Villamor and Makasiar, JJ., concur. SECOND DIVISION G.R. No. 82233 March 22, 1990 JOSE BARITUA and EDGAR BITANCOR, petitioners,vs. HONORABLE COURT OF APPEALS, NICOLAS NACARIO and VICTORIA RONDA NACARIO, respondents. Domingo Lucenario for petitioners. Ernesto A. Atienza for private respondents. SARMIENTO, J .: Succession case 857-914 Creditsto james perez Page27 Thi