G.R. No. L-5253

E. W. WHITE, plaintiff-appellee, vs. RAFAEL ENRIQUEZ, ET AL., defendants-appellants.

January 27, 1910

FACTS:

Don Antonio Enriquez y Sequera and Doña Ciriaca Villanueva y Solis died, leaving an estate and several heirs. During the administration of their estates, all heirs requested and consented to the court’s appointment of plaintiff E.W. White as a special commissioner to examine the administrator’s accounts and assist in the administration. White performed his duties and presented a bill for P5,960 for his services, which all heirs consented to, and the court allowed.

Subsequently, the heirs entered into an extrajudicial partition agreement. This agreement included a clause stating that “The undersigned (defendants-appellants) acquit the said Don Francisco Enriquez and his wife Carmen de la Cavada from all obligations arising from any hereditary or testamentary debt, it being understood that the former assume all debts and obligations of both estates with the exception of, etc.”

Only P600 was paid to White. He filed an action against the defendants-appellants to recover the balance of P5,360, basing his claim on the aforementioned clause in the partition agreement. The lower court rendered judgment in favor of White for the full amount, interpreting the clause as an explicit agreement by the defendants to pay White’s claim.

ISSUE:

I. Did the extrajudicial partition agreement, specifically the clause where the defendants assumed “all debts and obligations of both estates,” include the special commissioner’s fee as an “hereditary or testamentary debt” to be paid by the signatories?

II. If not, are the heirs, specifically the defendants-appellants, otherwise liable to the plaintiff, and to what extent, considering some heirs were not made parties to the action?

RULING:

I. No. The Supreme Court held that a debt created during the course of administration of an estate, such as the special commissioner’s fee, is not an “hereditary or testamentary debt” in the sense used in the partition contract. Such a debt is considered an expense of administration, and while it must be paid out of the funds of the estate, it is not, strictly speaking, a direct debt of the estate itself that would fall under the contractual assumption of “hereditary or testamentary debt.”

II. Yes, but only for their proportionate share. The Court found that, independent of the contract clause’s interpretation, the heirs were jointly responsible to the plaintiff for the amount of his claim. This liability arose because they secured his appointment, received the benefit of his services, and consented to the bill for such services. However, since two heirs, Don Francisco and Doña Carmen de la Cavada (who represented Jorge’s interest), were not made parties to the action, no judgment could be rendered against them. Under Article 1137 of the Civil Code (which provides for joint, not solidary, liability unless expressly stipulated), the defendants could only be held liable for their proportionate share of the debt.

The Supreme Court, therefore, modified the lower court’s judgment. The plaintiff was awarded P4,288 (representing the proportionate share of the defendants-appellants) with interest from the date the action was commenced.