Facts:

The case involves the Bank of the Philippine Islands as the plaintiff and Francisco Reyes as the defendant, with the estate of Nicolas Carranceja being a significant part of the proceedings. The events leading to the litigation began on May 31, 1902, when it was found that Nicolas Carranceja owed Francisco Reyes a substantial debt amounting to $53,721.04 Mexican. Shortly after this settlement, Carranceja passed away in Daet, Camarines Norte, and his widow, Josefa Pavon, continued the business operations that her husband had managed, incurring further debt amounting to P6,671.18 conant to Reyes. In December 1905, Reyes sold his claim against Carranceja’s estate to the Bank of the Philippine Islands. The bank's claim was presented before the commission on claims for the estate, which was disapproved on July 30, 1906. The Court of First Instance, on January 2, 1907, affirmed this disapproval, leading to the bank's appeal. Subsequently, in an unrelated action, the bank sued

...

Facts:

Commercial and Financial Relations

• On May 31, 1902, a settlement established that Nicolas Carranceja was indebted to Francisco Reyes in the sum of $53,721.04 Mexican.
• After the settlement, Carranceja died in the pueblo of Daet in the same year, leaving behind a widow, Josefa Pavon, and children.
• Following her husband’s death, Josefa Pavon continued similar business relations with Francisco Reyes, resulting in a separate debt of P6,671.18 conant.

Transfer and Presentation of the Claim

• On December 5, 1905, Francisco Reyes sold his claim against Carranceja’s estate to the Bank of the Philippine Islands (hereinafter “the Bank”).
• On March 31 (year not specifically stated), the Bank presented the acquired claim to the commission on claims appointed to settle the estate of Nicolas Carranceja.
• The commissioners disapproved the Bank’s claim on July 30, 1906, a decision later affirmed by the Court of First Instance on January 2, 1907.

Subsequent Litigation and Proceedings

• The Bank subsequently sued Josefa Pavon personally for the amount of its claim against both her and the estate, and obtained a judgment against her.
• On August 20, 1909, under the enforcement of that judgment, the Bank sold out Pavon’s interest in the estate and then purchased it for P37,500.
• On January 31, 1912, the Bank petitioned to intervene in the pending estate proceedings to replace Josefa Pavon, asserting it had acquired her interest in the estate.

Orders and Motions in the Lower Courts

• The Court of First Instance (Ambos Camarines) issued several orders:
• The January 2, 1907 judgment resolved that the commission lacked jurisdiction to approve the claim for $53,721.04 Mexican; the court did not resolve whether the estate was liable for the additional debt of P60,382.22 conant.
• The August 20, 1908 order approved the final account rendered by the administratrix (Josefa Pavon), identified the heirs and their shares, appointed Pavon as guardian for minors, and set aside claims not presented earlier.
• The August 24, 1909 order, following a hearing, addressed two pivotal questions regarding the Bank’s standing and the propriety of the partition approved by the commissioners.
• In the August 24, 1909 order, the court found that:
• The judgment against Josefa Pavon was directed against her personally, not in her capacity as administratrix of the estate.
• The widow retained a right to redeem her interest in the estate and to participate in its partition.
• The Bank, having purchased Pavon’s interest at public sale, was deemed to have acquired all her right, title, and interest in the estate.
• Despite this, the court maintained that the Bank’s interest was insufficient to justify its intervention in the final settlement proceedings.

Appeal and the Conflict on Standing

• The Bank, as appellant, asserted that the court erred by not incorporating the Bank’s sum (approximately P45,000) into the final distribution of the estate and dividing it among the heirs and creditors.
• In support of its appeal, the Bank presented only selected parts of the record, including testimony, the January 2, 1907 judgment, and orders from August 20, 1908, and August 24, 1909.
• The appellee introduced evidence of a decision by the Court of First Instance of Ambos Camarines (January 31, 1912) concluding that the Bank did not have a sufficient interest to intervene in the estate settlement or receive a part of the partition.

Issue:

Whether the Bank, by purchasing the claim from Francisco Reyes and acquiring a portion of the deceased’s estate interest from Josefa Pavon, had sufficient legal interest to intervene in the final settlement of Nicolas Carranceja’s estate.

• Did the Bank’s acquisition of Pavon’s interest in the estate confer upon it standing to appear in the estate proceedings in place of the administratrix?
• Is it proper for the Bank to insist that the sum it paid (approximately P45,000) be incorporated into the final partition and distributed among the heirs and creditors of the estate?

• Whether the decisions and orders rendered by the Court of First Instance, which did not recognize the Bank’s standing, were proper and binding in view of the established legal principles regarding claims on estates and the rights of creditors.

Ruling:

• (Subscriber-Only)

Ratio:

• (Subscriber-Only)

Doctrine:

• (Subscriber-Only)