G.R. No. 212670 - Movie and Television Review and Classification Board vs. ABC Development Corp.

M. E. Grey originally filed an action against Insular Lumber Company (the Company) to collect a sum of money.
Upon M. E. Grey’s death, Special Proceedings No. 387 were instituted for the administration of his estate.
Ruth Grey was appointed administratrix and, in that capacity, substituted the deceased M. E. Grey as plaintiff.
The trial court rendered judgment in favor of the plaintiff, which was later modified by the Supreme Court in a previous decision (G.R. No. L-535).

In compliance with the final judgment, the Company issued National City Bank of New York, Manila branch Check No. 220481 amounting to P88,453.56 in the name of Ruth Grey “in her capacity as administratrix of the Estate of M. E. Grey, deceased.”
This check was delivered to Atty. Carlos Hilado, acting as counsel for the plaintiff.

On February 23, 1954, Atty. Carlos Hilado filed a motion before the trial court.
Hilado claimed that he had a contingent fee contract with the late M. E. Grey for 25% of the judgment amount (equivalent to approximately P22,113.89).
He requested the court to order the defendant Company to cancel its issued check (No. F-220481) and to reissue two checks: one for P66,340.17 in the name of the administratrix and another for P22,113.39 in his name.
Hilado alleged that Atty. Jose A. Strachan, the attorney for the estate, was duly notified (via registered mail) at his residence in Escalante, Negros Occidental.
Hilado also mentioned that administratrix Ruth Grey was residing in the United States, leaving uncertainty as to her intentions regarding the distribution of the judgment proceeds.

The Company, through its counsel, opposed the motion arguing that it had fully complied with its obligation by paying the judgment debt in one lump sum.
The defense maintained that any claim for attorney’s fees should be pursued through proper petition in the probate proceedings.
Atty. Hilado filed an amended motion on March 8, 1954, reproducing the contingent fee contract, and emphasizing that his fees were “unpaid, reasonable and just.”
On the same date, he reiterated his prayer for the cancellation of the original check and issuance of two separate checks.
The trial court, on March 16, 1954, granted the amended motion, recorded Hilado’s charging lien for all legal purposes, and ordered the Company to cancel Check No. F-220481 and reissue the two checks accordingly.

Despite Atty. Hilado’s claim of having notified Atty. Strachan via registered mail, there were concerns over whether the legal representative of the estate could have been given sufficient time and opportunity to respond.
The fact that administratrix Ruth Grey was residing in the United States further complicated the issue of her timely participation in the proceedings.

The defendant Company, despite appearing to have no direct stake in the distribution of the funds from the judgment, appealed the trial court’s order.
The Supreme Court later set aside the trial court’s order, emphasizing the necessity for proper notice and participation by the legal representative of the estate.
The case was remanded to the trial court for further proceedings, specifically to set the motion for hearing with sufficient time for the administratrix to be notified and to participate.

Whether Atty. Hilado’s claim to a charging lien for his contingent fee, made after the full payment of the judgment, is legally valid.
The issue centers on the timing of the filing and recording of the lien—after the defendant had complied with its payment obligation.

Whether administratrix Ruth Grey, as the legal representative of the deceased’s estate, should have been given proper notice and an opportunity to contest or approve the contingent fee claim.
The issue includes whether her lack of participation undermined the enforceability of Hilado’s claim.

Whether claims for attorney’s fees, especially those based on contingent fee contracts, should be settled in the probate proceedings rather than via a direct order enforcing a charging lien.
The issue involves reconciling the roles of the trial court and the probate court in approving disbursements from the estate.

Whether the speedy filing of the amended motion and subsequent recording of the lien afforded sufficient opportunity for all interested parties, particularly the administratrix, to be heard.
How the principles of due process and notice apply in the context of the payment of attorney’s fees from an estate’s funds.