FACTS:

Ceferino Aramburu y Lambarri and Josefa Garcia Pascual were a married couple in Albay who owned property. Josefa Garcia Pascual died intestate on July 5, 1889, followed by her husband, Ceferino Aramburu y Lambarri, on June 18, 1899, leaving eleven children. The conjugal properties remained undivided.

On October 3, 1902, an heir’s husband requested the appointment of an administrator for Josefa Garcia’s estate. On December 9, 1902, Luis Palomar Baldovi was appointed administrator, a committee of experts was formed with rights and duties under Section 669 of the Code of Civil Procedure, and a nine-month period was set for creditors to present claims. Later, A. U. Betts was appointed judicial administrator in place of Baldovi.

While the estate was under administration and after an inventory and liquidation of the conjugal partnership (gananciales) were made, Angel Ortiz, through his attorneys, appeared on March 29, 1906, claiming to be a party in interest. Ortiz alleged that he was a mortgage creditor for P97,000, as shown by a public instrument from June 15, 1889, during the existence of the conjugal partnership. He prayed for the annulment of the liquidation, arguing that his credit should be given preference and paid from the partnership assets.

The administrator of Garcia’s estate moved to dismiss Ortiz’s petition, contending that Ortiz had no right to intervene as he was neither an heir nor a creditor of either estate.

The lower court, on February 27, 1907, issued an order holding that Ortiz was entitled to appear and be heard, but dismissed his petition for the annulment of the liquidation. Both Ortiz and the administrator appealed this order.

It was established that Ortiz’s representative was aware of the committee appointed to liquidate Josefa Garcia’s estate and hear claims but did not appear to set up Ortiz’s claims within the prescribed term, which had already expired. Furthermore, Ortiz had previously initiated an action in the Court of First Instance of Manila against the heirs of the late Ceferino Aramburu, obtaining a judgment for P345,193.31, which was subsequently affirmed by the Supreme Court in Case No. 3143.

ISSUE:

Did Angel Ortiz have the right to intervene as a creditor in the intestate estate proceedings of Josefa Garcia Pascual and seek the annulment of the conjugal property liquidation, despite having failed to present his claim to the committee of appraisers and claims within the statutory period, and having already secured a judgment against the heirs of the deceased spouses in a separate action?

RULING:

No, Angel Ortiz had no right to intervene as a party in interest in the proceedings for the intestate estate of Josefa Garcia Pascual. The Supreme Court affirmed the lower court’s dismissal of his petition for annulment of the liquidation.

The Court ruled that under Section 686 of the Code of Civil Procedure, it is a creditor’s duty to appear before the committee appointed to appraise the hereditary property and hear claims against it. Section 695 of the same Code explicitly states that a person with a claim against a deceased person, proper to be allowed by the committee, who does not exhibit his claim within the required notice period, “shall be barred from recovering such demand.”

In this case, Ortiz’s representative was aware of the committee and the term set for claims (9 months from December 9, 1902) but failed to present his claim within that period. Consequently, he lost his right to make any claim effective against the estate of Josefa Garcia.

Furthermore, Ortiz had already opted to pursue his credit directly against the heirs of the spouses Aramburu and Garcia in a separate action, where he obtained a favorable judgment that was later affirmed by the Supreme Court. By taking this course of action, he became a creditor of the heirs rather than directly of the intestate estate in question, in the strict sense of the law for the purposes of these specific estate proceedings.

Therefore, because he failed to comply with the statutory requirement of presenting his claim to the committee and had chosen to pursue his claim against the heirs, Ortiz had no right to intervene in the intestate estate proceedings of Josefa Garcia Pascual.