GR L 5775; (October, 1910) (Digest)
G.R. No. L-5775
IN RE INTESTATE ESTATE OF JOSE REYES Y MIJARES.BUENAVENTURA GALVEZ Y PUIG, plaintiff-appellant, vs. LA COMPAÑIA MARITIMA, defendant-appellee.
October 10, 1910
FACTS:
Don Jose Reyes y Mijares died intestate on November 10, 1906. His widow, Doña Buenaventura Galvez y Puig, was appointed administratrix of his estate. She submitted an inventory of “mobiliario y alhajas” without fixing their value. A commission was appointed to appraise the estate and hear claims. After publishing notice, the commission reported on August 30, 1907, that no claims had been filed within the 6-month statutory period (ending July 14, 1907), and the estate was declared free from obligation.
On June 24, 1909, La Compañia Maritima, a creditor with a claim of P31,517.16, filed a motion asserting that the administratrix had failed to include significant properties in the inventory, specifically a house on Calle Alix and a share in the steam launch Ventura, thereby prejudicing creditors. The administratrix later reported that vouchers for these properties were found among the deceased’s papers, and the house was subsequently registered in Jose Reyes’ name on September 3, 2008 (after the original claims period closed). La Compañia Maritima then moved for the appointment of a new commission to appraise these additional properties and hear claims against the estate to that extent.
The lower court granted the motion, ordering the appointment of a new commission for this purpose. The administratrix appealed, contending that all claims not presented within the originally prescribed period were barred by law.
ISSUE:
Can a probate court appoint a new commission to appraise newly discovered or previously omitted property and hear claims against an estate, even after the statutory period for filing claims has expired and the original commission has been discharged, when there is evidence of fraud or concealment by the administratrix?
RULING:
Yes. The Supreme Court ruled that the administratrix’s failure to include the properties in the original inventory, whether intentional or not, constituted fraud against the creditors of the estate.
The Court held that claimants have a right to rely on the correctness of the inventory. If an administrator knowingly or willfully omits property, thereby inducing claimants not to present their claims within the prescribed period, the probate court, acting as a court of equity, should extend the time for the presentation of claims or appoint a new commission. Fraud vitiates all transactions it touches, and no length of time, however great, will be a bar to relief if the injured party has been in ignorance of the fraud.
Therefore, the Court affirmed the lower court’s order to appoint a new commission to appraise the additional property not included in the first inventory and to hear claims against the estate, to the extent of these additional assets. The administratrix was also required to add these properties to her inventory. The case was remanded to the lower court for the appointment of the new commission.