G.R. No. L-26751 - Matute vs. Court of Appeals

Case Summary (G.R. No. L-26751)

Key Dates and Procedural Posture

Relevant administrative and litigation dates noted in the record include: appointment of Matias as co-administrator (May 29, 1963); accountings for 1963 and 1964; petition by Carlos to remove Matias (filed Aug. 20, 1965); evidentiary reception (Dec. 29, 1965); probate court order removing Matias and appointing Jose (Jan. 31, 1966); Court of Appeals issuance of preliminary injunction (Mar. 4, 1966); multiple civil actions in the Court of First Instance of Davao (notably Civil Case No. 4968 by Nasser and Civil Case No. 4252 by Matias in the name of the estate); petitions to the Supreme Court filed as L-26751 (Oct. 27, 1966), L-26085 (May 19, 1966) and L-26106 (May 25, 1966).
Applicable constitutional framework: the decision was rendered in 1969; the appropriate constitution in effect at the time (for legal context relied upon by the Court) is the 1935 Philippine Constitution.
Relevant procedural and substantive law: Rules of Court provisions concerning removal of administrators (Rule 82 §2), demurrer to evidence (Rule 35), applicability of ordinary civil rules to special proceedings (Rule 72 §2), periods to file answers and motions (Rule 11, Rule 16), rules on default and relief therefrom (Rule 38, Rule 41 §2(3)), and the Court of Appeals’ jurisdictional limit (value threshold used to determine appellate jurisdiction in probate incidents).

Consolidation and Overall Purpose of the Supreme Court Action

The three separately filed petitions for certiorari with preliminary injunction (L-26751, L-26085, L-26106), all brought by Jose S. Matute and arising from the same intra-family contest over settlement and administration of the Matute estate, were consolidated for disposition by this Court because of their interrelated facts and legal questions affecting the prolonged administration of the estate.

Jurisdictional Issue — Court of Appeals (L-26751)

The Court addressed at the outset whether the Court of Appeals had jurisdiction to entertain Matias’ petition (CA-G.R. 37039-R) attacking the probate court order of January 31, 1966 (which removed Matias as co-administrator and appointed Jose). Applying controlling precedent (Fernandez v. Maravilla), the Court held that contests over administration incident to probate proceedings must be measured against the total value of the subject estate for jurisdictional purposes. Because the Matute estate’s value exceeded the P200,000 appellate threshold, the Court of Appeals lacked original jurisdiction to grant certiorari and preliminary relief in that matter. The Court therefore declared the Court of Appeals without jurisdiction over CA-G.R. 37039-R.

Due Process in Removal of an Administrator — Merits (L-26751)

The Supreme Court examined whether the probate court’s January 31, 1966 order removing Matias as co-administrator complied with due process and was supported by the record. The Court emphasized established principles: removal of an administrator under Rule 82 §2 rests largely in the discretion of the appointing court, and appellate courts will not lightly disturb such discretion absent gross abuse. Nonetheless, the Supreme Court found grave procedural infirmity and abuse of discretion in the probate court’s conduct: after movants presented their evidence, Matias timely filed objections to the movants’ exhibits and a motion to dismiss and/or demurrer to evidence expressly reserving his right to introduce evidence if the motion was denied. Instead of disposing of that motion and affording Matias the opportunity to present his own evidence, the probate court entered the removal order without holding a hearing on Matias’ reserved proof. The Court held this denial of the accused administrator’s full day in court constituted a deprivation of due process, rendering the removal order void. The Court further criticized the probate judge for relying on motu proprio findings culled from the probate record (not pleaded or specifically relied upon by the movants) — defects in Matias’ 1964 accounting, alleged decreases in income, alleged omissions regarding calves born, and an alleged “staggering” amount of advances — without giving Matias an opportunity to explain or rebut those specific findings.

Evaluation of the Evidentiary Grounds for Removal (L-26751)

On the merits of the probate judge’s factual conclusions, the Supreme Court found the judge’s stated bases for removal unavailing or insufficiently proven:

The 1964 account used to justify removal was itself not final and, as to certain aspects, was later subject to reconsideration and set aside by the probate court; therefore it was premature and prejudicial to use that account as the principal ground for ouster.
A reduction in income is not ipso facto proof of willful negligence or bad faith; multiple external factors may cause income diminution, and absent proof of malfeasance or intentional failure to account, good faith must be presumed.
The alleged omission concerning cattle offspring could be an inadvertence or clerical error, requiring explanation rather than immediate branding as “palpable.”
Allegations of unauthorized advances required notice and specific proof; the purported “Compliance” listing advances was not placed in evidence and might represent aggregated advances by various administrators rather than unauthorized payments by Matias alone.
The failure to pay certain taxes is not necessarily evidence of willful neglect; lack of funds or other legitimate causes may explain unpaid taxes.

The Court concluded that the probate court’s haste, reliance on unadjudicated record findings, and failure to permit Matias to present his reserved defense constituted a grave abuse of discretion and denial of due process. The removal order was therefore nullified.

Appointment of Jose S. Matute as Co-Administrator (L-26751)

Because the removal of Matias was void, there was no vacancy to fill; accordingly the appointment of Jose as co-administrator in the January 31, 1966 order was likewise void. The Court also held, independently, that even if a vacancy had existed, the record did not show that the probate court conducted the requisite hearing and gave notice to all known heirs and interested parties on the petition to appoint Jose (or others) as co-administrator. The Court reiterated that appointment of an administrator requires hearing and notice so that suitability and possible oppositions may be considered. The Court therefore set aside the appointment of Jose.

Civil Case No. 4968 and Default Proceedings (L-26085)

Following the probate order of January 31, 1966 (which was later found void), Jose attempted to assert physical control over five haciendas that had been under Matias’ separate administration. Mariano Nasser, the lessee allegedly under a lease executed by Matias (Feb. 10, 1965), filed Civil Case No. 4968 in the Court of First Instance of Davao seeking injunction and alleging forcible attempts to take possession. The trial court issued an ex parte preliminary injunction and later, after procedural exchanges, declared Jose in default (April 16, 1966), entered judgment by default (April 23, 1966) awarding possession to Nasser and various monetary damages and costs, and issued an order of execution (May 3, 1966). Jose then filed a petition for certiorari in the Supreme Court challenging the default, judgment and execution.

Illegality of Default and Judgment — Notice and Receipt Principles (L-26085)

The Court analyzed the timing of procedural notices and the defendant’s entitlement to renewed time to answer after denial of a motion to dismiss. Under Rules 11 and 16, a movant who files a motion to dismiss is entitled, upon denial or deferment of the motion, to a fresh period within which to file an answer, counted from receipt of notice of the denial. In Civil Case No. 4968, Jose timely filed a motion to dismiss (Feb. 23, 1966). The motion was denied on March 31, 1966, but the defendant’s counsel did not receive notice of denial until April 25, 1966 due to an acknowledged mailing delay by the clerk’s office. The trial court nevertheless declared default on April 16, 1966, a date preceding counsel’s receipt of notice of denial and therefore occurring before the new answer period could begin to run. The Court found that the clerk’s admitted inadvertent delay in mailing created the very reason why the defendant’s counsel had not been able to answer within the required period. Declaring default under those circumstances was excess of jurisdiction and a deprivation of due process. The default, the judgment by default and the order of execution were thus nullified. The Court observed further that the motion to dismiss had raised substantive defenses, warranting at least notice and hearing rather than summary condemnation.

Scope of Relief in L-26085

The Supreme Court annulled the order of default (April 16, 1966), the judgment by default (April 23, 1966), and the order of execution (May 3, 1966). The Court previously (May 23, 1966) had granted a preliminary injunction conditioned on a bond; in the final disposition the Court sustained the injunctive relief and vacated the challenged default-related decrees.

Civil Case No. 4252 — Dismissal and Subsequent Defaults (L-26106)

Civil Case No. 4252 was filed by Matias in the name of the estate seeking among other reliefs the annulment of a compromise agreement (December 1962) and reconveyance of properties. Defendants, including Canlas, pleaded res judicata, relying on the prior compromise judgment of December 5, 1962 (Civil Case No. 14208, CFI Manila) and the subsequent denial of a petition for relief on July 13, 1963. The trial court deferred resolution of motions to dismiss until after trial; later, Matias filed a motion to withdraw/dismiss and others moved to dismiss on res judicata grounds. The Court of First Instance of Davao dismissed Civil Case No. 4252 with prejudice on February 15, 1966, as prayed by the defendants’ motion to dismis

Case Syllabus (G.R. No. L-26751)

Background and parties

The decision consolidates and resolves three petitions for certiorari with preliminary injunction: G.R. Nos. L-26751, L-26085 and L-26106, all filed by Jose S. Matute, one of fifteen heirs of the estate of Amadeo Matute Olave.
The petitions arise from prolonged intra-fraternal disputes among the Matute heirs that have delayed settlement of the estate for more than a decade.
Key parties:
- Jose S. Matute — petitioner in the three consolidated petitions; sought appointment as co-administrator and later sought relief from various trial-court orders.
- Matias S. Matute — respondent in L-26751 and a central co-administrator whose removal was contested.
- Carlos S. Matute — heir who initially moved for Matias’s removal and sought appointment as co-administrator.
- Agustina, Elena, Amadeo Matute Candelario and Anunciacion Candelario — heirs who joined the motion to remove Matias and sought appointment of replacement co-administrators.
- Carlos V. Matute — general administrator mentioned in proceedings.
- Mariano Nasser — plaintiff in Civil Case No. 4968 (CFI Davao) who opposed Jose’s attempted takeover of five haciendas.
- Respondent judges and tribunals: Probate Court (Branch IV, CFI Manila, presiding at relevant times by Judge Emigdio Nietes), Court of Appeals (CA-G.R. No. 37039-R), and the Court of First Instance of Davao (Judge Vicente P. Bullecer).

Procedural posture and consolidation rationale

The three petitions were filed within approximately five months and are materially intertwined; the Court therefore resolved them in a single decision.
L-26751 challenges the Court of Appeals’ taking cognizance of CA-G.R. No. 37039-R (Matias’s petition for certiorari with preliminary mandatory injunction) and contests the probate court order of January 31, 1966 removing Matias as co-administrator and appointing Jose S. Matute in his place.
L-26085 challenges CFI Davao orders: order of default (April 16, 1966), judgment by default (April 23, 1966), and order of execution (May 3, 1966) in Civil Case No. 4968 (Mariano Nasser v. Jose S. Matute), arising from Jose’s attempted possession of five haciendas.
L-26106 attacks (1) the dismissal with prejudice of Civil Case No. 4252 (order of February 15, 1966), (2) the order declaring intervenors in default and imposing damages (order and judgment of March 29, 1966), and (3) the order of execution (April 12, 1966) in the same civil case.

Factual summary — origins of the disputes

On August 20, 1965, Carlos S. Matute filed a petition in Special Proceeding No. 25876 (settlement of the Amadeo Matute Olave estate) to remove Matias S. Matute as co-administrator and to appoint Carlos.
Matias answered and later filed an amended opposition (Aug. 25, 1965) asserting (a) he rendered accounts for 1963 (May 20, 1964) and for 1964 (Feb. 8, 1965) approved by heirs holding 63% interest, (b) he was appointed by a final executory order of May 29, 1963, and (c) the alleged criminal charge against him was trumped-up and did not occupy his time.
On Sept. 21, 1965, other heirs (the Candelario Matute heirs and Anunciacion Candelario) moved for immediate appointment of Agustina, Carlos and Jose as joint co-administrators (or any one of them) and sought removal of Matias and ouster of general administrator Carlos V. Matute, alleging unpaid taxes, flawed financial statements, late inventories/accounts, unauthorized disbursements, and the probate court’s discretion to remove administrators.
Reception of evidence occurred Dec. 29, 1965 (probate court, Branch IV, CFI Manila). The movants submitted exhibit lists; Matias objected to admission of movants’ exhibits on Jan. 8, 1966, and filed a Motion to Dismiss/Demurrer to Evidence on Jan. 12, 1966, expressly reserving the right to present evidence if the motion was denied.
On January 31, 1966, the probate court issued the dispositive order removing Matias as co-administrator and appointing Jose S. Matute as co-administrator, requiring a P15,000 bond.
Matias filed with the Court of Appeals (CA-G.R. 37039-R) a petition for certiorari with preliminary mandatory injunction (Feb. 1, 1966) to set aside the January 31 order for alleged denial of due process and lack of hearing. On March 4, 1966 the Court of Appeals gave due course and granted a writ of preliminary injunction conditioned on a P1,000 bond.
Jose S. Matute challenged the Court of Appeals’ jurisdiction and on Oct. 27, 1966 filed the present certiorari (L-26751) against the Court of Appeals and Matias, urging that the estate’s value exceeds P200,000 and citing prior CA ruling in CA-G.R. 35124-R which refused jurisdiction based on a compromise agreement valuing the estate at over P2,132,282.72.
Separately, upon issuance of letters of co-administration to Jose (Feb. 3, 1966), Jose attempted to take possession of five haciendas in Governor Generoso, Davao (La Union, Sigaboy, Monserrat, Colatinan, Pundaguitan) previously assigned to Matias’s separate administration.
Mariano Nasser, in actual possession under a lease allegedly executed by Matias for P5,000/month on Feb. 10, 1965, filed Civil Case No. 4968 (injunction) in CFI Davao on Feb. 15, 1966; the court issued an ex parte preliminary injunction on Feb. 16, 1966 restraining Jose from taking possession.
Jose moved to dismiss Civil Case No. 4968 on Feb. 23, 1966 asserting lack of jurisdiction of the Davao court because the properties were custodia legis in the probate court (Sp. Proc. No. 25876) and disputing the validity/simulation of the lease.
The CFI Davao allegedly denied the motion to dismiss on March 31, 1966. Jose’s counsel asserts he did not receive a copy of that order until Apr. 25, 1966; the court later reported inadvertent delay by the clerk’s office and attached a registry receipt showing mailing on Apr. 16, 1966.
CFI Davao declared Jose in default on April 16, 1966 for failure to answer, entered judgment by default April 23, 1966 confirming Nasser’s possession and awarding damages and costs, and issued an order of execution May 3, 1966. Jose filed petition for certiorari (L-26085) on May 19, 1966 to annul those orders; this Court granted preliminary injunction on May 23, 1966 conditioned on a P5,000 bond (posted June 4, 1966).
In Civil Case No. 4252 (filed Feb. 5, 1966 by Matias as co-administrator of the estate), Matias sought annulment of a compromise agreement and compromise judgment (Dec. 5, 1962, Civil Case No. 14208, CFI Manila, Branch X) and the reconveyance of certain properties allegedly transferred pursuant to that compromise. Defendants (including Atty. Paterno R. Canlas) moved to dismiss on grounds including res judicata, relying on the prior compromise judgment and on a petition for relief denied July 13, 1963.
Jose and Luis Matute moved to intervene (Aug. 17, 1964) and were allowed (Sept. 5, 1964). Judge Cusi originally deferred final hearings on motions to dismiss until after trial; the case was later shuffled and assigned to Judge Vicente P. Bullecer.
Matias filed a motion to withdraw and/or dismiss the complaint (filed Jan. 8 (motion dated Jan. 8?) and/or subsequently), and on Feb. 15, 1966 Judge Bullecer dismissed Civil Case No. 4252 with prejudice on the ground of res judicata as prayed for by the defendants’ motions to dismiss. On March 12, 1966 the court declared all other incidents terminated and closed.
Nevertheless, on March 29, 1966 the same Judge declared the intervenors Jose and Luis, and the plaintiff estate, in default for failure to answer Canlas’s counterclaim and entered a judgment by default adjudging the intervenors jointly and severally liable for P100,000 and the estate liable to other defendants for P50,000; an order of execution was entered April 12, 1966. Jose (and Luis) filed petition for certiorari with preliminary injunction (L-26106) on May 25, 1966 to nullify those orders.

Issues presented to the Supreme Court

Whether the Court of Appeals had jurisdiction to entertain and issue a preliminary mandatory injunction in CA-G.R. No. 37039-R attacking the probate court order of Jan. 31, 1966 removing Matias and appointing Jose.
Whether the probate court’s order of Jan. 31, 1966 removing Matias as co-administrator and appointing Jose as co-administrator is valid or void for denial of due process and for want of evidentiary support.
Whether the appointment of Jose as co-administrator was valid in the circumstances (notice, hearing, presence of a general administrator).
Whether the CFI Davao orders of default (Apr. 16, 1966), judgment by default (Apr. 23, 1966), and order of execution (May 3, 1966) in Civil Case No. 4968 were void for irregularity/excess of jurisdiction because of mailing delay and denial of due process.
Whether the dismissal with prejudice of Civil Case No. 4252 (Feb. 15, 1966) was void and whether the subsequent declaration of intervenors’ default and the judgment by default (Mar. 29, 1966) and execution (Apr. 12, 1966) are void or should be set aside.
Whether certiorari was the proper remedy for the intervenors as against the challenged final order of dismissal in L-26106 or whether an appeal was the exclusive remedy.

Governing jurisdictional rule and its application (Court of Appeals’ jurisdiction)

The Court app