G.R. No. L-5303 June 30, 1953
In re intestate estate of the deceased TAN SIN AN. KONG CHAI PIN, petitioner-administratrix-appellant, vs. ANTONIO C. GOQUIOLAY, movant-claimant-appellee.

FACTS

Tan Sin An died intestate on June 26, 1942. In the administration proceedings for his estate in the Court of First Instance of Davao, his widow, Kong Chai Pin, was appointed administratrix. To pay obligations of the deceased, Kong Chai Pin petitioned the court for authority to sell real property, including three parcels of land belonging to a partnership formed between the deceased and Antonio C. Goquiolay. The court granted the petition. On April 4, 1949, Kong Chai Pin, in her own behalf, as administratrix, and as alleged manager of the partnership, executed a deed of sale to Washington Z. Sycip and Betty Y. Lee. The court approved this sale in its order of April 26, 1949. On July 25, 1949, Antonio C. Goquiolay, the surviving partner, filed a petition in the administration proceedings protesting the approval. He alleged the deed covered partnership lands without specifying only the deceased’s share was being conveyed, thereby depriving him of his own share. He prayed the order approving the deed be set aside as to his share. The administratrix opposed, alleging the lands belonged to the partnership “Tan Sin An and Antonio C. Goquiolay,” that Goquiolay had no voice in management, and that the approving order was final and the court lacked jurisdiction to set it aside. The court overruled the opposition. In its order of December 29, 1949, it granted Goquiolay’s petition, set aside the approval order as to Goquiolay’s share, declared the sale void as to that share, and ordered cancellation of any transfer certificates of title issued based on the sale and issuance of new ones in the names of Goquiolay and the purchasers of Tan Sin An’s share. The administratrix’s motion for reconsideration was denied. She appealed to the Court of Appeals, which certified the case to the Supreme Court as involving a question of law.

ISSUE

Whether the lower court erred in ordering the annulment of the sale and cancellation of titles without joining the vendees (Washington Z. Sycip and Betty Y. Lee) as indispensable parties to the proceedings.

RULING

Yes. The Supreme Court set aside the lower court’s order and remanded the case for a new trial. The Court held that the vendees, Washington Z. Sycip and Betty Y. Lee, were indispensable parties under Section 7, Rule 3 of the Rules of Court, which provides that parties in interest without whom no final determination can be had of an action shall be joined. Their interests were necessarily affected by the annulment, yet they were neither notified nor heard, nor made parties to the annulment proceedings. Without them, the question of whether the sale should be annulled could not be finally determined. Therefore, it was error for the court to order the annulment and cancellation of titles. The case was remanded to correct this procedural defect by joining all indispensable parties. The Court expressly refrained from ruling on the appellant’s other specifications of error since all affected parties were not before the Court.