GR 108947; (September, 1997) (Digest)
G.R. No. 108947 September 29, 1997
ROLANDO SANCHEZ, FLORIDA MIERLY SANCHEZ, ALFREDO T. SANCHEZ and MYRNA T. SANCHEZ, petitioners, vs. THE HONORABLE COURT OF APPEALS, ROSALIA S. LUGOD, ARTURO S. LUGOD, EVELYN LUGOD-RANISES and ROBERTO S. LUGOD, respondents.
FACTS
Following the deaths of spouses Juan C. Sanchez and Maria Villafranca, separate intestate proceedings were initiated. Rosalia Lugod, the legitimate daughter, filed for administration of her mother’s estate. After Juan Sanchez’s death, his illegitimate children (the petitioners) filed for administration of his estate, which Rosalia opposed. To settle the dispute, the parties, all assisted by counsel, executed a Compromise Agreement on October 30, 1969, partitioning the properties of Juan Sanchez. This was later modified by a Memorandum of Agreement on April 13, 1970. The trial court, however, did not approve this compromise. Years later, the petitioners moved to annul the agreements on grounds of fraud. The trial court eventually issued a decision that, among other things, declared certain deeds of sale executed by the deceased spouses in favor of Rosalia and her children as simulated and fictitious, effectively nullifying them and adjudicating the properties based on intestate succession.
ISSUE
The core issues were: (1) Whether a petition for certiorari under Rule 65 was the proper remedy to assail the trial court’s orders that nullified the deeds of sale and effectively passed upon title; and (2) Whether the compromise agreement partitioning the inherited properties was valid and binding even without the approval of the probate court.
RULING
The Supreme Court affirmed the Court of Appeals’ decision, ruling in favor of the respondents. On the first issue, the Court held that certiorari was the correct remedy. The trial court, acting as a probate court, exceeded its jurisdiction when it declared the deeds of sale simulated and fictitious. A probate court’s authority is limited to the settlement and distribution of the estate; it cannot adjudicate questions of ownership or title to properties claimed to be part of the estate but also asserted to belong to outside parties. By nullifying the deeds, the trial court made a definitive ruling on title, which is beyond its jurisdiction. Certiorari lies to correct such grave abuse of discretion amounting to lack of jurisdiction.
On the second issue, the Court ruled that the compromise agreement was valid and binding even without court approval. The agreement was executed by all heirs, all of whom were of legal age and represented by counsel. It was a final settlement of the estate outside the judicial proceeding. The approval of the probate court is required only when the settlement is submitted for judicial sanction. Here, the parties chose an extrajudicial partition, which is expressly permitted by law. The agreement effectively terminated the intestate proceedings as there was nothing left for the court to administer, the heirs having validly divided the estate among themselves. The long lapse of time—over nine years before the petitioners sought to annul it—further militated against their claim of vitiated consent.