G.R. No. L-10474 - Sampilo vs. Court of Appeals

Petitioner: Felisa Sinopera, acting as the administratrix of Teodoro Tolete’s estate.
Respondents: Benny Sampilo and Honorato Salacup, who became involved through successive conveyances of the land.
Deceased: Teodoro Tolete, who died intestate in January 1945, leaving behind four parcels of land in San Manuel, Pangasinan.

The decedent left as heirs his widow, Leoncia de Leon, along with several nephews and nieces.
The existence of multiple heirs contrasted with the later extrajudicial settlement executed by the widow.

On July 25, 1948, without any judicial proceedings, Leoncia de Leon executed an affidavit declaring that the deceased left no children, dependents, or other heirs, naming herself as the sole heir to all properties.
The affidavit was duly registered in the Office of the Register of Deeds of Pangasinan.
On the same day, Leoncia de Leon executed a deed of sale of the four parcels to Benny Sampilo for the sum of P10,000, which was also registered.
Subsequently, on June 17, 1950, Benny Sampilo sold the same parcels to Honorato Salacup for P50,000; this transaction was likewise registered.

In March 1950, Felisa Sinopera instituted proceedings for the administration of Teodoro Tolete’s estate (Special Proceeding No. 3694, Pangasinan).
After being appointed administratrix, she filed an action on June 20, 1950, to recover her and the other legitimate heirs’ proper share of the properties.
A notice of lis pendens was filed in the Office of the Register of Deeds and recorded on the certificates of title on June 26, 1950, after the registration of the deed to Salacup.

Felisa Sinopera alleged that the extrajudicial affidavit and subsequent deeds of sale were fraudulently executed to deprive the legitimate heirs of their rights.
It was contended that neither the affidavit nor the deeds validly conveyed title to the respondents, thereby invalidating the transactions.
The respondents, however, countered that the complaint was lacking in cause of action, that any claim was barred by the statute of limitations, and that they were innocent purchasers for value.
They further argued that the complaint was frivolous and intended to harass and inconvenience them.

The Court of First Instance ruled in favor of Felisa Sinopera by declaring the affidavit, as well as the deeds of sale, null and void; it also awarded her one-half share of the land and terminated Leoncia de Leon’s usufructuary rights.
The Court of Appeals modified this ruling by confirming the annulment of the affidavit but limiting the annulment of the deeds of sale exclusively to the portion of the properties that exceeded the share of Leoncia de Leon.
Additionally, the Court of Appeals reserved for Honorato Salacup the right to claim his corresponding share and to seek damages against Leoncia de Leon and Benny Sampilo.

First, petitioners contended that the action to recover the one-half share had prescribed since it was filed almost four years after the registration of the extrajudicial settlement, invoking Section 4 of Rule 74 and analogous cases (e.g., McMicking vs. Sy Conbieng; Ramirez vs. Gmur).
They argued that because not all legitimate heirs participated in or were given notice of the extrajudicial settlement, the effects of the settlement should not extend to them, thereby invalidating the transactions.
Finally, they challenged the lower court’s denial of their motion for a new trial and raised the issue of whether the respondents acquired title as innocent purchasers for value.

The case involves a meticulous review of Sections 1 and 4 of Rule 74, which govern extrajudicial settlements and impose a two-year period for actions by those prejudiced by such settlements.
Emphasis was laid on the necessity for all heirs to participate in an extrajudicial settlement, as stipulated in both the current rule and its predecessor (Section 596, Act No. 190).
The Court scrutinized whether the statutory limitation applied to non-participating heirs and addressed the broader principles of due process and fairness in protecting unrepresented interests.

Whether Felisa Sinopera’s action was barred by the statute of limitations under Section 4 of Rule 74, considering that the extrajudicial settlement had been registered nearly four years prior to the filing of the present action.
Whether the limitation provision applies to heirs who did not participate in or were not notified of the extrajudicial settlement.

Whether Benny Sampilo and Honorato Salacup could be deemed innocent purchasers for value despite allegations of fraud and insufficient notice regarding the existence of other heirs.
Whether there was adequate evidence to establish that both respondents knew or should have known about the claims of the other heirs.

Whether the lower courts erred in their decisions, especially regarding the annulment of the extrajudicial affidavit and partial annulment of the deeds of sale.
Whether the denial of the petitioners’ motion for a new trial was justified in light of the arguments raised.