Case Summary (G.R. No. 125835)
Factual Background
On February 3, 1989, petitioner and private respondents entered into a Contract to Sell covering Lot 2125 (23,766 sqm) at ₱150 per square meter. Respondents paid a ₱300,000 downpayment. Petitioner subsequently refused to complete the sale, invoking the pendency of probate proceedings and the lack of probate court approval.
Procedural History
• Trial Court (Branch 24, Biñan): Granted petitioner’s demurrer to evidence and dismissed respondents’ complaint for specific performance, holding the contract void for lack of probate court authorization under Rule 89, Section 7, Rules of Court.
• Court of Appeals (CA-GR CV No. 41994): Reversed the dismissal, declaring the Contract to Sell valid and binding, subject to the outcome of estate administration.
• Supreme Court: Petition for review on certiorari.
Applicable Law
• 1987 Philippine Constitution – protection of private property and contract obligations.
• Civil Code of the Philippines:
– Article 777 – hereditary rights transmitted at death.
– Article 399 – part owners may assign their undivided share.
• Rules of Court, Rule 89, Section 7 – authorization for executor or administrator to sell estate property when necessary or beneficial.
Issue
Whether an heir’s sale of a property devised to her, executed during pending probate proceedings without court approval, is valid and binding.
Court of Appeals Ruling
The appellate court found that petitioner acted in her capacity as an heir and owner of the devised property, not as executrix or administratrix selling for the benefit of the estate. Rule 89, which governs sales by an estate representative, did not apply. The Contract to Sell explicitly described petitioner as “lawful owner” selling to meet personal financial needs. The appellate court held the contract valid but suspended enforcement until estate administration concluded.
Supreme Court Ruling
The petition is denied. The Supreme Court affirms that:
- Petitioner held full ownership of her hereditary share upon her father’s death (Article 777, Civil Code).
- An heir may legally sell an undivided share without prior probate court approval (Article 399, Civil Code; Jakosalem v. Rafols, 73 Phil. 628 (1942)).
- The Contract to Sell contained a protective condition: actual transfer of title and consummation await full payment and termination of probate proceedings.
- Allowing the sale does not impede estate administration or prematurely partition the estate.
Validity of the Contract in the Heir’s Capacity
Heirs immediately acquire ownership rights at the decedent’s death. A sale by an heir of his or her share in an inheritance is not subject to Rule 89’s approval requirements, which apply solely to sales by an executor or administrator for the benefit of the estate.
Preservation of Estate Administration
The contract’s
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Statement of the Case
- Petition for review seeks to overturn the Court of Appeals’ decision in CA-GR CV No. 41994 (February 6, 1996) and its Resolution (July 19, 1996)
- Central question: Is a contract to sell real property involved in pending testate proceedings valid and binding without probate court approval?
- Trial court dismissed private respondents’ complaint by granting petitioner’s demurrer to evidence, declaring the contract void for lack of probate court approval
- Court of Appeals set aside the dismissal and declared the contract to sell valid and binding, subject to the result of the administration of the estate
Facts
- On February 3, 1989, petitioner Natalia Carpena Opulencia executed a contract to sell Lot No. 2125, Sta. Rosa Estate, Laguna (23,766 sq. m.) to private respondents at ₱150.00 per sq. m.
- Private respondents paid ₱300,000.00 as downpayment; petitioner acknowledged receipt but allegedly failed to comply with her obligations
- Petitioner asserted that the property formed part of her late father’s estate under probate in RTC Branch 24, Biñan, Laguna, and that the contract lacked probate court approval
- Petitioner offered to return the downpayment; private respondents refused and sought specific performance, damages, attorney’s fees, and litigation expenses
- Stipulated facts at pre-trial: the contract price, downpayment receipt, knowledge of pending probate proceedings, and absence of probate court approval
Procedural History
- Trial court granted demurrer to evidence in an order of December 15, 1992, dismissing the complaint as the sale required p