Remedial Law

Teresita De Leon vs. Court of Appeals

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G.R. No. 128781 – 386 SCRA 216 – Remedial Law – Special Proceedings – Settlement of Estate – Jurisdiction of Probate Courts – Order of Inclusion vs Order of Collation; Order of Inclusion/Exclusion of Property to the Estate Inventory is an Interlocutory Order

Rafael Nicolas died and an intestate proceeding to settle his properties was filed. Teresita De Leon, one of Rafael’s children was appointed as the administrator. Teresita’s appointment was opposed by Ramon De Leon, her brother. Ramon likewise filed a Motion for Collation alleging that certain properties in the name of Teresita De Leon were advance inheritance received by Teresita during the lifetime of Rafael as those properties were allegedly given gratuitously by Rafael to Teresita. Teresita argued that the said properties were acquired by her from Rafael via onerous title.

In November 1994, the probate court included the properties subject of the motion for collation in the inventory of the estate. Teresita moved for reconsideration but her motion was denied. The probate court also removed her as administrator on the ground of conflict of interest.

In November 1996, Teresita then filed a certiorari case against the probate court. The Court of Appeals denied her petition on the ground that the order in November 1994 which included the properties enumerated in the motion for collation has already become final.

ISSUE: Whether or not an order including or excluding a property from the estate inventory is final and executory.

HELD: No. It is an interlocutory order. A probate court acquires supervision and control over the estate of a deceased person when it took cognizance of the case. One of the probate court’s duties is to see that the inventory submitted by the administrator appointed by it contains all the properties, rights and credits which the law requires the administrator to set out in his inventory. In compliance with this duty the court has also inherent power to determine what properties, rights and credits of the deceased should be included in or excluded from the inventory. Should an heir or person interested in the properties of a deceased person duly call the court’s attention to the fact that certain properties, rights or credits have been left out in the inventory, it is likewise the court’s duty to hear the observations, with power to determine if such observations should be attended to or not and if the properties referred to therein belong prima facie to the intestate, but no such determination is final and ultimate in nature as to the ownership of the said properties.

However, due to the probate court’s limited jurisdiction, it can only pass upon questions of title provisionally.

SIDE ISSUE 1: If there are questions of ownership and the heirs or any interested party wants to settle said questions with finality, what should they do?

File a separate action. The patent reason is the probate court’s limited jurisdiction and the principle that questions of title or ownership, which result in inclusion or exclusion from the inventory of the property, can only be settled in a separate action.

All a probate court could do as regards said properties is determine whether they should or should not be included in the inventory or list of properties to be administered by the administrator. If there is a dispute as to the ownership, then the opposing parties and the administrator have to resort to an ordinary action for a final determination of the conflicting claims of title because the probate court cannot do so.

SIDE ISSUE 2: Is the order in November 1994 an Order of Collation or a mere order of inclusion?

It is a mere order of inclusion. What the parties and the lower courts have perceived to be as an Order of Collation is nothing more than an order of inclusion in the inventory of the estate which is an interlocutory order. The motion for collation was filed with the probate court at the early stage of the intestate estate proceedings. The records of the case do not indicate that the debts have been paid and the net remainder of the estate have already been determined, and the estate at the time filing of the motion for collation was ready for partition and distribution. In other words, the issue on collation is still premature.

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