126 SUPREME COURT REPORTS ANNOTATED

Ignacio vs. Pampanga Bus Co., Inc.

No. L-18936, May 23, 1967.

INTESTATE ESTATE OF ENCARNACION ELCHICO

VDA. DE FERNANDO, deceased. NATIVIDAD E.
IGNACIO and LEONOR E. ALMAZAN, administratrices-
appellants, vs. PAMPANGA BUS COMPANY, INC.,
claimant-appellee.

Pleading and Practice; Settlement of decedent's estate; Money

claim should be filed in proceeding for settlement of decedent's
estate.·The procedural rule, which provides for the dismissal of a
civil action for the recovery of money, upon the death of the
defendant, without prejudice to filing the claim in the testate or
intestate proceedings, is intended to avoid useless duplicity of
procedure.
Same; Money claim adjudged against administrator of
decedent's estate is not subject to the statute of nonclaims.·Where a
money claim was continued against the administrator of the
decedent's estate, who was substituted for the deceased defendant,
the estate waived thereby its right to relitigate the same claim in
the intestate proceedings. The judgment against the administrator
should be allowed as a claim against the estate. It is not subject to
the statute of non-claims.
Same; When tardy claim may be entertained.·Where a money
claim, which was still being litigated in a civil action, was filed in
the intestate proceeding after the expiration of the period fixed in
the notice to creditors but before the order of final distribution was
issued, the pendency of the civil action was a good excuse for the
tardy f iling of the claim. The probate court did not abuse its
discretion in ordering the payment of the claim. The order for its
payment impliedly granted the creditor an extension within which
to file said claim.

APPEAL from an order of the Court of First Instance of

Manila.

The facts are stated in the opinion of the Court.

Paterno R Canlas for administratrices-appellants.
Manuel O. Chan and A G. Martinez for claimant-
appelle.

SANCHEZ, J.:

The present case has its roots in the proceedings

hereinafter to be recited:
August 29, 1951. Pampanga Bus Company, Inc. (referred
to herein as Pambusco) lodged its complaint in the Court of
First Instance of Manila against two (2) def endants,
Valentin Fernando and Encarnacion Elchico Vda. de

127

VOL. 20, MAY 23, 1967 127

Ignacio vs. Pampanga Bus Co., Inc.

Fernando. The suit was 1

to collect P105,000.00 upon a
contractual obligation.
January 23, 1955. Encarnacion Elchico Vda. de
Fernando died. By this time, Pambusco in the foregoing
civil case had already presented its evidence and submitted
its case. 2
March 23, 1955. Intestate proceedings were filed.
Notice to the estate's creditors was given for them to file
their claims within six (6) months from this date, the first
publication of the notice.
April 16, 1955. On Pambusco's motion, the court in the
civil case ordered Jose Nicolas, then administrator, to
substitute for the deceased Encarnacion Elchico Vda. de
Fernando as one of the defendants. No objection to this
order was registered.
July 15, 1955. Pambusco amended its complaint in the
civil case naming therein administrator Jose Nicolas and
original defendant Valentin Fernando, as defendants. The
court, without objection, admitted this amended complaint
on August 27, 1955.
Jose Nicolas, as such administrator, filed an amended
answer with counterclaim against Pambusco. The date of
filing said answer is not of record. In due course, Nicolas
presented his evidence.
 December 11, 1958. After trial on the merits, the Court
of First Instance of Manila rendered judgment in the civil
case (Civil Case 14578), as follows:

"Wherefore, judgment is hereby rendered in favor of the plaintiff

and against the defendants, ordering the latter to pay the former
the sum of NINETY-THREE THOUSAND PESOS (P93,000.00)
together with the costs of these proceedings. Defendants'
counterclaim is hereby dismissed."

The two defendants appealed.

May 28, 1960. The Court of Appeals affirmed the
judgment, thus.·

________________

1 Civil Case No. 14576, Court of First Instance of Manila'.

2 Special Proceedings 25256, Court of First Instance of Manila,
entitled "Intestate Estate of Encarnacion Elchico Vda. de Fernando,
deceased,"·the present case.

128

128 SUPREME COURT REPORTS ANNOTATED

Ignacio vs. Pampanga Bus Co., Inc.

"As plaintiff's complaint is well founded and meritorious and the

evidence of record justify the award of P93,000.00 in its favor, it
stands to reason that defendants' counterclaims were correctly
dismissed.
Wherefore, the judgment appealed from is hereby affirmed,
3
without pronouncement as to costs."

Both defendants appealed4 by certiorari to this Court.

Valentin Fernando's appeal was dismissed for having been
filed out of time. The appeal
5
of the estate of Encarnacion
Elchico Vda. de Fernando , raising issues of fact, was
likewise dismissed.
February 25, 1959. We go back to Special Proceedings
25256, Intestate Estate of Encarnacion Elchico Vda. de
Fernando. On this day, while defendants in Civil Case
14576 were perfecting their appeal from the judgment of
the Court of First Instance, Pambusco registered its
"contingent" claim in these special proceedings·for
whatever money judgment may be rendered in his favor in
the civil suit.
 January 25, 1961. The judgment in the civil case having
reached finality, Pambusco moved in the intestate
proceedings that the heirs and/or the present joint
administratrices, Natividad E. Ignacio and Leonor E.
Almazan, be ordered to pay P46,500.00, the share of the
deceased in the judgment debt.
The administratrices opposed. Ground: Pambusco's
claim is time-barred.
March 13, 1961. Resolving Pambusco's motion, the
probate court (in Sp. Proc. 25256) issued an order, the
dispositive part of which is as follows:

"Wherefore, the Court hereby allows said amount of P46,500.00 to

be paid by the heirs and/or the joint administratrices; but no
payment thereof shall be made until after the administratrices shall
have informed the Court in writing as to the existence of other
unsettled money claims against the estate and of the sufficiency of
the assets available for payment of all the debts.

________________

3 CA-G.R. No. 24458-R.

4 G. R. No. L-17184.
5 G. R. No. L-17100.

129

VOL. 20, MAY 23, 1967 129

Ignacio vs. Pampanga Bus Co., Inc.

In harmony with the foregoing, the Court hereby orders said

administratrices to inform the Court, within ten (10) days from the
notice of this order, of the other unsettled money claims, together
with the amount of each, and of the sufficiency or insufficiency of
the assets available for payment of all the debts.

By order of May 24, 1961, the probate court denied the

motion to reconsider the foregoing order.
The administratrices came to this Court on appeal,
Given the facts just recited, was Pambusco's claim
properly admitted by the probate court?
It will be remembered that at the time Encarnacion
Elchico Vda. de Fernando died, the civil case against her
and the other defendant Valentin Fernando had not yet
been decided by the Court of First Instance of Manila. That
case, however, was prosecuted·with the assent of the
administrator of her estate·to final conclusion.
1. This situation brings to the fore6 a consideration of
Section 21, Rule 3 of the Rules of Court, which reads:

"SEC. 21. Where claim does not survive.·When the action is for
recovery of money, debt or interest thereon, and the defendant dies
before final judgment in the Court of First Instance, it shall be
dismissed to be prosecuted in the manner especially provided in
these rules."

The philosophy behind the rule which provides for the

dismissal of the civil case is that, upon the death of a
defendant, all money claims should be filed in the testate
or intestate7
proceedings "to avoid useless duplicity of
procedure." Obviously, the legal precept just quoted is
procedural in nature. It outlines the method by which an
action for recovery of money, debt or interest may continue,
upon the terms therein prescribed. Whether the original
suit for the recovery of money·as here·proceeds to its
conclusion, or is dismissed and the claim covered thereby
filed with the probate court, one thing is certain: no
substantial rights of the parties are prejudiced.

________________

6 A reproduction of Section 21, Rule 3 of the 1940 Rules of Court.

7 Moran, Comments on the Rules of Court, Vol. I, 1963 ed., pp. 180-
181.

130

130 SUPREME COURT REPORTS ANNOTATED

Ignacio vs. Pampanga Bus Co., Inc.

But is there justification for the civil case to go on in spite

of the death of Encarnacion Elchico Vda. de Fernando
"before final judgment in the Court of First Instance?"
2. At the time of the death of defendant Encarnacion
Elchico Vda. de Fernando, plaintiff Pambusco had already
closed its evidence and submitted its case. Her
administrator substituted. By this substitution, the. estate
had notice of the claim. The estate was thus represented.
The administrator did not complain of the substitution. At
no time did the estate of the deceased impugn the authority
of the regular courts to determine the civil case. Much less
did it seek abatement of the civil suit. On the contrary, its
administrator took active steps to protect the interests of
the estate. He joined issue with plaintiff. He filed an
amended answer. He counterclaimed. He went to trial.
Defeated in the Court of First Instance, he appealed to the
Court of Appeals. He even elevated that civil case to this
Court. Now that the judgment has become final, the estate
cannot be heard to say that said judgment·reached after a
full dress trial on the merits·will now go for naught. The
estate has thus waived its right to have Pambusco's claim
re-litigated in the estate proceedings. For, though
presentment of probate claims is imperative, it is generally
understood that 8
it may be waived by the estate's
representative. And, waiver is to be determined
9
from the
administrator's "acts and conduct." Certainly, the
administrator's failure to plead.the statute of nonclaims,
his active participation, and resistance 10to plaintiff's claim,
in the civil suit, amount to -such waiver.
3. Courts are loathe to overturn a final judgment.
Judicial11 proceedings are entitled to respect. Non quieta
movere. Plaintiff's claim has passed the test in three
courts of justice: the Court of First Instance, the Court of
Appeals and this Court. The judgment in plaintiff's favor
should be enforced. Appellants' technical objection·after
judgment had become final in the civil case·that plain-

_________________

8 21 Am. Jur., p. 578; 34 C.J.S., pp. 679-680; 34 A.L.R., pp. 393-395.

9 21 Am. Jur., p. 618.
10 34 C.J.S., p. 680,
11 Banco Español Filipino vs. Palanca, 37 Phil. 921, 942.

131

VOL. 20, MAY 23, 1967 131

Ignacio vs. Pampanga, Bus Co., Inc.

tiff's claim should have been litigated in the probate court

does not impair the validity of said judgment. For, such
objection does not go Into the court's jurisdiction over the
subject matter.
In Laserna vs. Altavas, 68 Phil. 703, suit was started by
Jose Altavas against Jose Laserna Paro to recover
P4,500.00 as attorney's fees. The Court of First Instance
decided in plaintiff's favor. During the pendency of
Laserna's appeal in this Court, he died. Aristona Laserna,
the administratrix of Laserna's estate, substituted. This
Court affirmed the judgment. Altavas subsequently filed in
the estate proceedings a motion to direct the administratrix
to pay the judgment for P4,500.00 in his favor. The court
granted this motion. On appeal, the administratrix urged
that Altavas' claim "was definitely barred by the statute of
nonclaim," because of his failure "to present
12
it before the
committee
13
on claims and appraisal." This Court there
stated. ·

"x x x we are of the opinion and so hold that, upon the facts and
circumstances of the present case, the claim of Jose Altavas,
although it did not survive the deceased, need not have to be
presented before the committee on claims and appraisal principally
because that claim is already an adjudicated claim by final
pronouncement by this Court in G.R. No. 40038. To countenance
appellant's theory would be to convert a claim duly passed upon and
determined not only by the Court of First Instance but by this Court
into a contested claim, once again, xxx and 'obliging a creditor
whose claim had already been passed upon by the Court to submit
himself to the committee on claims and to pass over again through
the endless process of presenting his evidence which he had already
done/ xxx It also appears that the substitution of the defendant in
civil case No. .2961, for the recovery of attorney's fees, was effected
at the instance of the defendant and appellant therein, Aristona
Laserna. She had an opportunity to contest that claim, and when
her contention was overruled she did not impugn the jurisdiction of
the Supreme Court, Neither does it appear that during the
pendency of the appeal in the Supreme Court she moved for the
abatement or suspension of the proceedings because of the
provisions of sections 119, 700 and 703 of the Code of Civil
Procedure. Under

_________________

12 The committee on claims and appraisal has been abolished. Money claims
are now presented directly to the court.
13 At pp. 706-707, italics supplied.

132

132 SUPREME COURT REPORTS ANNOTATED

Ignacio vs. Pampanga Bus Co., Inc.
the circumstances it is unjust to defeat the 'claim of the appellee and
14
to hold that it has been barred by the statute of nonclaim."

4. Of course, it is correct to say that upon the demise of a

defendant in a -civil action planted on a claim which does
not survive, such claim should be presented to the

________________

14 The Code of Civil Procedure (Act 190) provides:

"SEC. 119. Death of party.·In case a party to an action dies while the action is
pending, the action shall not abate by reason thereof, but the court on motion
may allow the action or proceeding to be continued by or against his executor,
administrator, or other legal representative, and the judgment, if it be for the
payment of costs and against the executor, administrator, or other legal
representative, shall be that he pay in due course of administration: Provided,
nevertheless, That if the action is for the recovery of money, debt, or damages
against the deceased, it shall be discontinued, and the claim thereafter be
prosecuted as provided in section six hundred and eighty-six."
"SEC. 686. Committee to be sworn and may administer oaths.·The
committee appointed to appraise the estate and to allow claims as hereinbefore
provided, shall act under oath, and may administer oaths to parties and
witnesses upon the trial of questions before them. They may try and decide
upon claims, which by law survive against executors or administrators, except
claims for the possession of or title to real estate; and may examine and allow
claims at their present value, which are payable at a future day, although such
claims are payable in specific articles and they may set off demands in favor of
the estate against demands. against the estate, and determine the balance due
either way,"
"SEC. 700. Suits pending against the estate to be discontinued.·All actions
commenced against the deceased persons, f or the recovery of money, debt, or
damages, and pending at the time the committee are appointed, shall be
discontinued, and the property, if any therein attached, shall be discharged
from the attachment, and the claim embraced in such action may be presented
to the committee, who shall allow the party prevailing the costs of such action
to the time of its discontinuance."
"SEC. 703. Certain actions survive.·Actions to recover the title or
possession of real estate, buildings, or any interest therein, action to recover
damages for an injury to person or property, real or personal and actions to
recover the possession of specific articles of personal property, shall survive,
and may be commenced and prosecuted by or against the executor on
administrator; but all other actions commenced against the deceased before his
death shall be discontinued, and the claims therein in volved presented before
the committee as herein provided."
 133

|VOL. 20, MAY 23, 1967 133

Ignacio vs. Pampanga Bus Co., Inc.

probate court for allowance, if death occurs before final

judgment in the Court of First Instance. But, procedural
niceties aside, the revival of the civil action against the
administrator, the decedent's representative, "is generally
considered equivalent
15
to presentation" of such claim in the
probate court,
16
and "dispenses with the actual presentation
of the claim" The soundness of this proposition commands
assent. Because, the administrator represents the
deceased's estate itself, is an alter ego of the heirs.
17
More
than this, he is an officer of the probate court. In the
circumstances, presentment of Pambusco's 1950 claim ad
abundantiorem cautelam was at best reduced to a mere
formality.
5. It matters not that Pambusco's said claim was filed
with the probate court without the six-month period from
March 25, 1955, set forth in the notice to creditors. For,
Section 2, Rule 86, permits
18
acceptance of such belated
claims. Says Section 2:

"SEC. 2, Time within which claims shall be filed.·In the notice

provided in the preceding section, the court shall state the time for
the filing of claims against the estate, which shall not be more than
twelve (12) nor less than six (6) months after the date of the first
publication of the notice. However, at any time before an order of
distribution is entered, on application of a creditor who has failed to
file his claim within the time previously limited, the court may, for
cause shown and on such terms as are equitable, allow such claim
to be filed within a time not exceeding one (1) month."

Here, the claim was filed in the probate court on February

25, 1959, while the defendants in the civil case were still
perfecting their appeal therein. The record does not show
that the administrator objected thereto upon the ground
that it was f iled out of time. The pendency of that case, we
are persuaded to say,
19
is a good excuse for tardiness in the
filing of the claim. And, the order of final distribution is
still to be given.

_______________
 15 21 Am. Jur. 578; italic supplied.
16 34 C J.S., p. 160; italic supplied.
17 Lat vs. Court of Appeals, L-17591, May 30, 1962.
18 Which was formerly Section 2 of Rule 87.
19 In pari materia: De Rama vs. Palileo, L-18935, February 26, 1965.

134

134 SUPREME COURT REPORTS ANNOTATED

National Shipyards and Steel Corp. vs. C.I.R.

Besides, the order of the lower court of March 18, 1961

allowing payment of appellee's claim "impliedly granted
said appellee
20
an extension of time within which to file said
claim." The probate court's discretion
21
has not been
abused. It should not be disturbed.
For the reasons given, we vote to affirm the order of the
lower court of March 13, 1961 and May 24, 1961, under
review. Costs against appellants. So ordered.

Concepcion, C.J., Reyes, J.B.L., Dizon, Regala,

Makalintal, Bengzon, J.P., Zaldivar and Castro, JJ.,
concur.

Order affirmed.

Notes.·The rule, that a claim, which does not survive,

should be filed in the testate or intestate proceeding, was
applied in Macondray & Co., Inc. vs. Dungao, L-18079,
May 26, 1964.
Where the claim for damages was contained in a
decision of the Court of Appeals, which was promulgated
after the six-month period provided in the notice to
creditors had expired, the lower court did not abuse its
discretion in admitting the claim (De Rama vs. Palileo, L-
18935, Feb. 26, 1965).

______________

© Copyright 2019 Central Book Supply, Inc. All rights reserved.