G.R. No. L-38051 December 26, 1974
Severino Paredes and Victorio G. Ignacio, petitioners, vs. The Hon. Jose L. Moya, Judge of the Court of First Instance of Manila, Branch IX and Carmencita Navarro-Administratrix (Substituted for deceased August Kuntze), respondents.

FACTS

Petitioner Severino Paredes filed a collection suit for separation and overtime pay against his employer, August Kuntze. The Court of First Instance (CFI) rendered a decision against Kuntze, who appealed to the Court of Appeals. During the pendency of the appeal, Kuntze died. The Court of Appeals subsequently dismissed the appeal for failure to file the printed record, making the CFI judgment final. Paredes then moved for execution. The sheriff levied upon and sold at public auction two lots belonging to the deceased’s estate, with Paredes as the highest bidder. He subsequently sold his rights to the property to his co-petitioner, Victorio Ignacio.
The administratrix of Kuntze’s estate, Carmencita Navarro, moved to quash the writ of execution. The respondent CFI judge granted the motion, nullifying the writ of execution, the levy, and the auction sale. The court ordered that the judgment could only be enforced by filing it as a claim in the estate settlement proceedings. Paredes and Ignacio challenged this order via certiorari.

ISSUE

Whether the respondent court acted with grave abuse of discretion in nullifying the execution proceedings and ordering the judgment creditor to file his claim in the estate settlement proceedings.

RULING

The Supreme Court dismissed the petition and affirmed the respondent court’s order. The legal logic is anchored on the proper procedure for enforcing money judgments against a deceased judgment debtor. The Court held that while the death of the defendant after a final CFI judgment does not cause the action to abate, the enforcement mechanism is strictly governed by rules on estate settlement.
The judgment against Kuntze became final and executory. However, upon his death, his properties passed into the custody of the probate court overseeing the settlement of his estate. Properties under administration are in custodia legis. Consequently, the CFI that rendered the money judgment loses its authority to issue a writ of execution against those estate properties. The correct procedure for the judgment creditor is to file the final judgment as a money claim in the probate court within the time prescribed for creditors, pursuant to Section 5, Rule 86 of the Rules of Court. The probate court then orders the administrator to satisfy the claim from the estate assets.
Therefore, the execution proceedings conducted by the sheriff were void for lack of jurisdiction. All acts performed under the void writ, including the levy and auction sale, were nullities. Co-petitioner Ignacio could not acquire valid title as a purchaser in good faith because he bought the rights after the administratrix had already challenged the execution’s validity, placing him on notice of the defect. The Supreme Court affirmed the order nullifying the execution but without prejudice to Paredes filing his judgment as a claim in the estate proceedings.