Ricardo M. Gutierez, Plaintiff-Appellant, vs Lucia Milagros Barretto-Datu, Executrix of the Testate Estate of the deceased Maria Gerardo Vda. de Barretto, Defendant-Appellee, G.R. No. L-17175, July 31, 1962.

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Title: Ricardo M. Gutierez, Plaintiff-Appellant, vs Lucia Milagros Barretto-Datu, Executrix of the Testate Estate of the deceased Maria Gerardo Vda. de Barretto, Defendant-Appellee, G.R. No. L-17175, July 31, 1962.
Language: English
Source: The Lawyers Journal XXVII (9) September 30, 1962
Year: 1962
Subject: Decedents' estates -- Philippines -- Cases; Inheritance and succession -- Philippines; Court of First Instance -- Rizal
Rights
Abstract: [Ricardo M. Gutierrez appeals from the orders of the Court of First Instance of Rizal (l) dismissing his complaint against Lucia Milagrns Barretto-Datu, as executrix of the estate of the deceased Maria Gerardo Vda. de Barretto, and (2) denying his motion for reconsideration of the dismissal.]
Fulltext: operate as a common carrier by land. It is not denied that under Section 13 (5) of the Corporation Law, a corporation created thereunder may purchase, hold, etc., and otherwise deal in such real and personal property as the purpose for which the corporation was formed may permit, and the transaction of its lawful business may reasonably and necessarily 1·equire. The issue here is precisely whether the purpose for which petitioner was organized and the trnnsaction of its lawful business reasonably and necessarily require the purchase and. holding by it of a certificate of public convenience like the on•: in question and thus give it additional authority to opernte thereunder as a common carrier by land. Petitioner claims in this regard that its corporate pmposer are to cany on a general mercantile and ccmmercial busin(!SS, ck., and that it is authorized in its a1·ticles of incorporati0n to 01>ernte und otherwise deal in and concerning automobiles and automobile accessories' business in all its multifarious ramification (petition· er's brief. p. 7\ and to operate, etc. and otherwise dispose of vessels and boal!'l, etc., and lo own and operate steamship and· mailing ships and other floating critft and deal in the same and engage in the Philippine Islands and elsewhere in the transportation of persons, merchandise and chattels by water; all this incidental to the transportation of automobiles (id. pp. 7-S a nd Exhibit B). We find nothing in the legal provision and the prOvisions of petitioner's articles of incorporation relied upon that could justify petitioner's contention in this case. To the contrary, the).· an• precisely the best evidence that it has no authority at all to engage in the business of land transportation and open\te a taxicab service. That it may operate and otherwise deal in automobiles and automobile accessories; thut it may engage i11 the transportation of persons by water does not mean that it may engage in the in the business of land transportation - an entirely different line of business. If it could not thus engage in this line of business, it follows that it may not acquire any cer tificate of public convenience to operate a taxicab service, such as the one in question, because such acquisition would be without purpose nn<l. would have no necessary connection with petitioner';; legitim~tc business. In view of the conclusion we have arrived at on the decisive issue involved in this appeal, we deem it unnecessary to resolve the other incidental questions raised by petitioner. WHEREFORE, the appealed decision in affirmed, with costs. Beng:zon, C.J., Padilla, Concepcion, Barrera, Paredes, and Makalintal, JJ., concun·ed. R-:gala, J., did not take part. VI Ricardo M. Gutiene::, Plaintiff-Avpellant, 1'8. l..ucia Milagros Barretto-Datu, E xecutrix of the Testate Estate of lhe deceased Maria Gerardo Vda. de Ba'r'retto, Defendant-Apvellee, G.R .. Vo. L17175, July 31, 1962, Maka/intal, J. 1. ESTATE OF A DECEASED PERSON; CLAIMS; AS USED I N STATUTE REQUIRING PRESENTATION OF CLAIMS AGAINST A DECEDENT'S ESTATE : CONSTRUED.-The word "claims" as used in statutes requiring the presentation of claims against a decedent's estate is generally constl'ucd to mean debts or demands of a pecuniary nature which have been enforced against the deeeased in his lifetime znd could have been reduced to simple money judgnrnnts; and among these are those founded upon contract. 21 Am. Jur. 579. 2. ID.; CLAIM BASED ON BREACH OF CONTRACT.- The claim in the case at bar is based on contract - specifically, on a breach thereof. It falls squarely under Section 5 of Ruic 87, Rules of Court. 3. ID.; ID.; CONTRACTS BY DECEDENT BROKEN DURING HIS LIFETIME; PERSONAL REPRESENTATIVE LIABILITY FOR BREACH OUT OF THE ASSETS.- Upon all contracts by the d(!ccdent broken during his lifetime, even though they were personal to the decedent in liability. the representative is answerable for the breach out of the assets. 3 Schouler on Wills, Exeeutors and Administrntors, 6th Ed., 2395. 4. ID.; ID.; PRESENTATION OF CLAIM FOR BREACH OF A COVENANT I N A DEED or~ DECEDENT.- A claim for breach of a covenant in a deed of the decedent must be presented under a statute requiring such presentment of all claims grounded on contract. 5. EXECUTOR OR ADMINISTRATOR; ACTIONS T HAT MAY BE I NSTITUTED AGAINST E ITHER.- The only actions that may be instituted against the executor or administrator are t hose to recover real or personal prope1·ty from the estate, or to enforce a lien thereon, and actions to recover damages for an injury lo person or property, real or personal. Rule 88, section I. The instant suit is not one of them. DE CISION Ricardo !\"I. Gutierrez appeals from the orders of the Court of First Instance of Rizal (l) dismissing his complaint against Lucia i\Iilagrns Barretto-Datu, as executrix of the estate of the deceased Maria Gerardo Vda. de Barretto, and (2) denying his motion for reconsideration of the dismissal. The l'elcvant facts alleged by appellant are as follows: In 1940 Maria Gerardo vda. de Barretto, owner of 371 hectares of fishpond lamls in Pampanga, lease(\ the same to appellant Gutierrez for a term to expi1·e· on May 1, Hl47. On Novcmbc?· l , 1941, pursuant to a decision of the Department of Public Works rendered after investigation, the dikes of the fishfonds were opened at several poin~s. resulting in their destruction and in the loss o( great quantities of fish inside, to the damage and prejudice of the lessee. In 195G, the lessot· having died in 1948 and the corresponding testate prnceeding to settle her estate havi11g been opened (Sp. Proc. No. 5002, C.F. I., Manila), Gutierrez filed a claim for two items: first, for the sum of 1'32,000.00 representing adva?1ce i en ta ls he had paid to the decedent (the possession of the leased JlrOpc1ty, it is alleged, having been returned to her after the opening of the dikes ordered by the government); and second, for the sum of PG0,000.00 as damages in the concept of unearned profits, that is, profits which the claima11t failed to realize bec::rnse of the breach of the lease contract allegedly committed by the lessor. On J une 7, 1957 appellant commenced the instant ordin~l'y civil action in the Court of F irst Instance Rizal (Quezon C!t:1 branch) against the executrix of the testate estate for th€: recovery of thr same amount of PG0,000.00 referred to as tl1e second item claimed in the administration preceding. The complaint specifically charges the decedent Maria Gerardo Vda. de Barretto, as lessor, with having violated a warranty in the lease contract against any damages the lessee might suffer by reason of the government that several rivers and creeks of t he public domain were included in the fishponds. In \July 1957 appellant amended his claim in the testate proceeding by withdrawing therefrom the item of PG0,000.00, lcavini;· only the one for refund of advam:e rentals in the sum of P32,000.00. After the issues were joined in the present case with the filing of the defendant's answer, together with a counterclaim, and after two postponements of the tiial were granted, the second of which was in January 1958, the court dismissed the action for aban· donmcnt by both parties in an order dated July 31, 1959. Appellant moved to reconsider; a ppellee opposed the motion ; and after considerable written argument the court , on March 7, 1960, denied the motion for reconsideration on the ground that the claim should have been prosecuted in the testate proceeding and not by ordinary civil action. Appellant submits his case on this Jone legal question: whether or not his claim for damages based on Un!·ealized profits is a money claim against the cstste of the deceased Maria Gerardo vda. de Barretto within the purview of Rule 87, Section 5. This section states: "SEC. 5. Claims which must be fi)ed under the 11otice~ If not filed, barred; cxccption.-All claims for money ag.'.linst Page 274 LA WYERS JOURNAL Scptembel' 30, HlG2 the decedent, arising from contrnct, express or implied, whc· ther the same be due, not due, or cortingent, all claims for funeral expenses and expenses of the last sickness of the decedent, and judgment for money agai11st th!! decedent, must hr! filed within the t ime limited in the notice; otherwise they are baned foi·ever, except that they may be set forth as counterclaims in any action lhat the executor or udministrntor may br ing against the claimants. W here an executor or ad. ministrator commences an action, or prosecutes an action aJ. ready commenced by the deceased in his lifetime, the debtor may set forth by answer the claims he has against the de· cedem, instead of pl'esenting them indPpendently to the court as herein provided, and mutual claims may be set off aga inst each other in such action; and if final judgment is rendered in favor of the defendant, the amount so tletermined shall be considci·ed tl1e true balance against the estate, as though the claim had been presented directly before the court in the ad· ministration proceedings. Claims not yet due, or contingcmt, may be approved at their present v·alue." T he word ''cla ims" as used in stat utes requi ring the present.a· tion of elaims against a decedent's estate is generally construed lo mea n debts or demands of a pecuniary nature which could have been enforced against the deceased in his lifetime and could have been reduced to simple money j udgments; a11d arilong these are those founded upon contract. 21 Am. Jur. 579. The claim in this case is based on contract - specifically, on a breach there· of. It falls squarely under section 5 of Ruic 87. "Upon all .con· tracts by the decedent broken during his lifetime, even though they were pei·sonat to the dcceclent in liability, the personal 1·e· 1 >resentative is answerable for the breach out of the assets." 3 Schouler on Wills, Executors a nd Administrators, 6t-h Ed., 2395. A cl:tim for breach of a covena nt in a deed of the dl'cedent must be Jlresented under a statute requiring such presentment of all claims grounded on contract. Id. 2461; Clayton v. Dinwoody, 93 P. 7::::3; IJames v. Corvin, 51 P. 2nd 689.(') The only actions t hat may be instill1ted against the executor or adminisfrator are those to recover rea l or personal prnpei·ty from the estate, or to enforce a lien thereon, and aetions to re· cover damages for 'an injury to person or property, real or per· sonal. Rule 88, section 1. The instant suit is not one of them. Appellant invokes Gavin v. l\lelliza, 84 Phil. 794, in support of his contention that this action is proper against the executrix. T he citation is not in point. T he claim thcrei!l, which was filed in the testate proceeding, was based upon a breach of contract committed by the executrix herself, in dismissing the claimant as administrator of the hacienda of the deceased. While the contract was with the decedent, its violation was by the executrix and hence personal to her. Besidf::s, the claim was for indemnity in the form of a certain quantity of palay every yea1 · for the unexpired po1 ·tion of the term of the contract. The denial of the claim was affirmed by this Court on the grounds that it was not a money (!) Plaintiff's claim arose from a breach of a covenant in the deed. It is very clearly expressed by the statute that all claims arising on contracts whether due, not due, or contingent, must be presented. The only exception made by the statute is t hat a mortgage 01· lien "against the property of t he estate subject thereto" may be enforced without first presenting a claim to the executor or administrator "wtiere all recourse against any other property of the estate is expressly waived in the complaint." But this was not an action to enforce a lien. It was not one seeking to have the claim satisfied out of specific property of t he cst~tc, or to subject any particular property of the estate to the satisfaction thereof. Clayton v. Dinwoody, 93 p. 723. The claim for damages for the unexpired portion of t he lea se is not an obligation incurred by the administratrix in the course of her admnistration of the estate. It arises out of a contractual obligation incurred by Louis llohnson and is governed by the statute of nonclaim. By the terms of the lease, he obligat· ed himsc!lf, his heirs, executors, administrators and assigns to pay $,4,860. for the premises for a term of five years, covering t he time involved in this action. A claim for damages for a breach of cont1:act arises out of that obligation requiring as prerequisite to a smt thereon, that the claim be served on the adtni11ist ratrix and filed with the clerk of court. James v. Corvin, 51 P (2d) 689. claim and that it arose after · the decedent's demise, placing it outside the scope of Rule 87, Sedion 5. The orders appealed from are affirmed, with costs against appellant. Bcngzon, C.J., Labrador, Conce1Jcion, Bart'':l'IJ, Paree/cs, Dizon mul Reyola, JJ., concuncd. Padilla, J., took no part. Vil Ter.esa Realty, Inc., Plai11tiffs-Appellee vs. Ca .. onen. Preysler l'ti<t. de Garl'iz, Defendant·A ppellant, G.H. No. f_.-14717, July 31, 1962, Padilla, J. LANDED ESTATES; CITY OF MANILA; SUSPENSION OF DETAINER. PROCEEDINGS UNDER REPUBLIC ACT 1162 AS AMENDED BY REPUBLIC ACT NO. 1599 ; REQUISITE.The authority grnnted by section 1 o( Republic Act No. 1599, ap· proved on 17 J une 1956, amending Republic Act No. 1162, which took effect on 18 J une 1954, to expropriate " landed estates or haciendas, or lands which formerly formed part thereof, in the City of Manila, which arc and have been leased to tenants for at least ten years," "Provided, T hat such lahds shall have at lea st fifty houses of tenants erected thereon," does not mean that once these conditions or requisites are present, Republic Act No. 1599 or Re· public Act No. 1162 wou!d readily be applied. Before either Act together with the remedies therein provided, such as suspension of detainer proceedings, installment payment of rentals, or maximization of rentals, could be availed of, it is necessary that proceedings for the expropriation of the parcel of land must have been instituted. Othen.vise, the law could not be availed of. Jn the case at bar, the parcel of land subject of the lit:gation is not being expropriated. DEC I S IO N On 19 May 1948 Carmen P reysler vda. Ganiz ac<i:iired 1 iy purchaso from the successors·in·interest of D. M. Fleming a resi· dential house and a leasehold right on a parcel of land (Lot ll·K) where the house stands (Exhibit A·2) . Situalc:d on 2:-: Manga Avenue, Santa :Mesa, Manila, the parcel of land contains an area of 1,492.59 square meters described in transfer certificate of title No. 30061 issued in the name of Tere~a Realty, Inc. by t he Regis· ter of Deeds in and for the City of J\fanila, and assessed at P22,. 540. On 21 March 1918 D. M. Fleming acquired by purchase the leasehold right from J ohn W. H aussermann (Exhibit A·l) who 011 3 June 1910 bad entered into a contract of lease with Demetrio Tuason y de la P az, the manager (administrador) of the E state of Santa Mesa y Diliman (Exhibit A). Under the 01 ·iginal lease agreement (Exhibit A) , the term thereof was to expire on 31, December 1953. Effective 1954 the parcel of land above referred to was H!ii· scssed at P22,540 by the City Assessor of Manila in the name of Teresa Realty, hie. (Exhibit B) . On 22 December 1953, or before the expiration of the lease on 31 Decembel' 1959, the Teresa Really, Inc. notified in writing Car· men Presyler vda. de Carriz that it would agree to a new lease for five years at an increased rental from Pl35 a year 1 ilus tax on the land to P225.40 a month, which is 12'/o of the assessed value of the parcel of land. Despite such offer to enter into a new lease contract the lessee refUsed to have it renewed for five yc::irs al ;.in increased rental as offererl by the lessor. For thm reason, : he Teresa Realty, I nc. brought a detainer action against Carme11 Preysler vela. de Garriz in the Municipal Court of Manila. A fte1· trial, the court 1·endered judgment 01·dering Carmen Preysler vrla. de Garriz or any person claiming under her to vacate the parcel of land subject of the lease and to pay PZ"25.40 as reasonable monthly rental for the use of the parcel of land from 1 January 1954 until possession of the same shall have been restored to the plaintiff, and costs. She appt'aled to the Court of F irst Instance of Manila. Whereupon, t he complaint filed i11 the Municipal Court was reproduced. On 17 Januai·y 1955 the defendant lessee a11swered anew the reproduced complaint and a lleged fnr· thcr by way of special defenses that she 'yas holding possession of the parcel of land waiting for the Court to decide the action September 30, 1962 LA WYERS JOURNAL Page 275
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