Santiago vs. Santiago

In a probate proceeding, a prior judgment dismissing a complaint for completion of legitime does not bar a subsequent motion for termination of administration and partition filed after the lapse of a twenty-year prohibition on partition, as the causes of action are distinct and res judicata does not attach. A testamentary condition that property shall remain indivisible or unowned perpetually is void for being contrary to public policy, because the Civil Code limits the duration of co-ownership to twenty years.

Basilio Santiago contracted three marriages and sired children from each. He died testate on September 16, 1973. His will devised various properties to his third wife and children from the second and third marriages, but imposed a twenty-year prohibition on the partition of a rice mill, animal feeds factory, parcels of land in Malolos, and the incomes thereof. During that period, the properties were to be administered by his children Ma. Pilar and Clemente Santiago. The will further provided that a house and lot in Manila be transferred in the names of Ma. Pilar and Clemente solely for administration, with no one owning it, and used perpetually by any descendant studying in Manila or nearby cities. The will was probated, and Ma. Pilar was appointed executrix. After the executrix submitted a final accounting, the probate court approved the distribution and directed the transfer of titles to Ma. Pilar and Clemente in 1978. Heirs of the first marriage (the Soco oppositors) later sought completion of their legitime, leading to a final judgment that barred their claim on res judicata and ordered the decree of distribution undisturbed. On October 17, 2000, after the twenty-year prohibition had expired, respondents (heirs of the second marriage) moved for termination of administration, accounting, and transfer of titles.

• The Testator and His Marriages: Basilio Santiago had three marriages. With his first wife, Bibiana Lopez, he had two daughters, Irene and Marta; the latter’s children are the oppositors Filemon, Leonila, Consolacion, Ananias, Urbano, and Gertrudes, all surnamed Soco. With his second wife, Irene Santiago, he had six children: Tomas, Cipriano, Ricardo, respondents Zoilo and Felicidad, and petitioner Ma. Pilar. With his third wife, Cecilia Lomotan, he had three children: Eugenia, petitioner Clemente, and Cleotilde.

• The Will’s Provisions: Basilio died testate on September 16, 1973. His will contained, among others, the following provisions:

  • Properties such as the rice mill, animal feeds factory, and parcels of land in Malolos, Bulacan were to be managed by Ma. Pilar and Clemente for twenty years following his death, during which time they could not be partitioned. Only the net income was to be divided among the heirs.
  • The house and lot in Manila (Lot No. 8-C, covered by TCT No. 131044) was to be transferred to Ma. Pilar and Clemente not as inheritance but solely for administration, with the condition that no one would own it and that it would be used perpetually by any descendant who wished to study in Manila or nearby cities.

  • The remaining lands (except the Manila property) were to be inherited equally by the third wife and all children from the second and third marriages, subject to the same twenty-year prohibition on partition and the administration by Ma. Pilar and Clemente.

  • Probate and Initial Distribution: The will was probated, and Ma. Pilar was appointed executrix. After she submitted a “Final Accounting, Partition and Distribution in Accordance with the Will,” the probate court approved it by Order of August 14, 1978, directing the registers of deeds to issue certificates of title over Lot Nos. 786, 837, 7922, 836, 838, and 8-C in the names of Ma. Pilar and Clemente Santiago.

  • Oppositors’ Claims for Legitime: The Soco heirs of the first marriage filed a Complaint-in-Intervention with the probate court, alleging that Basilio’s second wife was Maria Arellano (with whom he had no child) and that the will violated Articles 979-981 of the Civil Code on legitime. The probate court dismissed the complaint. The Soco heirs then filed a separate complaint for completion of legitime (Civil Case No. 562-M-90), which the RTC initially decided in their favor. On appeal, the Court of Appeals annulled that decision, holding that the probate court’s dismissal and its 1978 Order approving distribution constituted res judicata. The appellate court ordered that the decree of distribution remain undisturbed. The Supreme Court denied the ensuing petition for review, and the decision became final on April 9, 2003.

  • Motion for Termination and Transfer: On October 17, 2000, respondent heirs of the second marriage (Zoilo, Felicidad, and the heirs of Ricardo, Cipriano, and Tomas) filed before the probate court a “Motion for Termination of Administration, for Accounting, and for Transfer of Titles in the Names of the Legatees.” They alleged that the twenty-year administration period expired on September 16, 1993, and that petitioners should cease as administrators, surrender the titles, render an accounting, and transfer the properties to all named legatees. Petitioners opposed, arguing that the case had long been closed and terminated after the 1978 Order.

  • RTC Order: The probate court (Branch 10) granted the motion on September 5, 2003. It held that the twenty-year prohibition meant the 1978 Order was not yet final; the probate proceeding is continuing in character and terminates only upon final settlement of the estate. It directed petitioners to surrender titles, turn over possession and administration, render an accounting from August 14, 1978, and submit a proposed project of partition. The registers of deeds were ordered to cancel the titles in petitioners’ names and issue new ones to all legatees, including the Manila property to the heirs of all three marriages.

• Res Judicata: Petitioners argued that the Court of Appeals in CA-G.R. No. 83094 erred in not binding itself with its earlier decision in CA-G.R. No. 45801 (affirmed by the Supreme Court in G.R. No. 155606), which ordered that the decree of distribution remain undisturbed. They maintained that the prior judgment constituted res judicata, barring the motion for termination of administration and transfer of titles because it involved the same parties, the same properties, and the same decree of distribution.

• Closure of Probate: Petitioners contended that the case had long been closed and terminated with the approval of the Final Accounting, Partition and Distribution in 1978 and the subsequent issuance of certificates of title in their names.

• Manila Property: Petitioners objected to the inclusion of the Manila property covered by TCT No. 131044 among those to be transferred to the legatees-heirs, arguing that such transfer would contravene the testator’s explicit intent that no one should own it and that it be used perpetually by descendants for educational purposes.

• Expiration of Prohibition Period: Respondents maintained that the twenty-year period within which the subject properties were to be under the administration of Ma. Pilar and Clemente expired on September 16, 1993. Consequently, the administrators should have ceased their functions, transferred the titles to the named legatees, and rendered an accounting.

• Continuing Nature of Probate: Respondents effectively argued that the probate proceeding was not terminated by the 1978 Order because the will itself postponed full partition and distribution until after twenty years, and thus the motion was a proper continuation of the probate proceeding.

• Statutory Limit on Indivisibility: Although not directly framed as an argument by respondents in the Supreme Court, the appellate court’s ruling, which respondents defended, held that the testator’s condition of perpetual indivisibility and prohibition on ownership of the Manila property was void under Articles 494, 870, and 1083 of the Civil Code, which limit co-ownership to twenty years.

• Res Judicata: Whether the final judgment in CA-G.R. No. 45801 (G.R. No. 155606), which ordered the decree of distribution to remain undisturbed, constitutes res judicata barring the subsequent motion for termination of administration, accounting, and transfer of titles.

• Manila Property: Whether the Manila house and lot covered by TCT No. 131044 may be ordered transferred to the legatees-heirs despite the testator’s express will provision that no one shall own it and that the property shall be used perpetually by any descendant studying in Manila or nearby cities.

• Res Judicata: Neither aspect of res judicata — bar by prior judgment nor conclusiveness of judgment — applied. The prior final judgment addressed the oppositors’ complaint for completion of legitime and preterition, whereas the present petition solely concerned the propriety of termination of administration and transfer of titles after the twenty-year prohibition period lapsed. The causes of action were clearly not identical. While there was identity of parties, the prior judgment could only operate as estoppel regarding the issue of preterition and reduction of legitime, an issue not involved in the present proceeding. The directive that the decree of distribution remain undisturbed merely prohibited the oppositors from interfering with the distribution; it did not bar respondents’ supervening right, arising after the twenty-year period, to demand termination of administration and partition.

• Manila Property: The testator’s condition that the Manila property be owned by no one and remain indivisible perpetually was void for contravening public policy. Articles 494, 870, and 1083 of the Civil Code expressly limit the duration of co-ownership and the prohibition to partition property to a maximum of twenty years. To sanction a co-ownership beyond that statutory limit, even if ordained by the testator, would be contrary to public policy. The probate court’s order to include the Manila property in the transfer to the legatees-heirs was thus proper, as the prohibition could only be effective for twenty years from the testator’s death.

• Res Judicata — Two Aspects (Rule 39, Sections 47[b] and 47[c]) — “Bar by prior judgment” proscribes the prosecution of a second action upon the same claim, demand, or cause of action already settled in a prior action. “Conclusiveness of judgment” ordains that issues actually and directly resolved in a former suit cannot again be raised in any future case between the same parties involving a different cause of action. Here, neither aspect applied because the prior case (completion of legitime) and the present action (termination of administration after twenty years) involved different causes of action, and the issue of legitime reduction was not raised in the present proceeding.

• Continuing Nature of Probate Proceedings — A probate proceeding is continuing in character and terminates only after the final distribution or settlement of the whole estate in accordance with the will. An order approving an initial accounting and distribution does not automatically close the proceeding when the will itself postpones full partition and imposes ongoing administrative duties for a specified period.

• Statutory Limitation on Co-ownership and Indivision — Under Articles 494, 870, and 1083 of the Civil Code, a prohibition to divide property in a co-ownership cannot exceed twenty years. An agreement or testamentary provision imposing indivision for a longer period is void for being contrary to public policy. The prohibition period is reduced to the legal maximum of twenty years, after which co-owners may demand partition.

• “The principle of res judicata does not apply in the present probate proceeding which is continuing in character, and terminates only after and until the final distribution or settlement of the whole estate of the deceased in accordance with the provision of the will of the testator.” — This excerpt underscores that the initial order approving accounting was not a final termination of the probate proceeding.

• “The final judgment regarding oppositors’ complaint on the reduction of their legitime in CA-G.R. NO. 45801 does not dent the present petition, which solely tackles the propriety of the termination of administration, accounting and transfer of titles in the names of the legatees-heirs of the second and third marriages. There is clearly no similarity of claim, demand or cause of action between the present petition and G.R. No. 155606.” — The Court distinguished the causes of action to reject the res judicata argument.

• “Although the Civil Code is silent as to the effect of the indivision of a property for more than twenty years, it would be contrary to public policy to sanction co-ownership beyond the period expressly mandated by the Civil Code.” — The ratio decidendi for voiding the perpetual indivisibility condition and ordering the Manila property transferred to the heirs.

• Chris Garments Corp. v. Sto. Tomas, G.R. No. 167426, January 12, 2009, 576 SCRA 13 — Cited for the definitions of the two aspects of res judicata: bar by prior judgment and conclusiveness of judgment.

• Oropeza Marketing Corp. v. Allied Bank, G.R. No. 129788, 393 SCRA 278 (2002) — Cited as authority for the principle of bar by prior judgment.

• Heirs of Rolando Abadilla v. Galarosa, G.R. No. 149041, 494 SCRA 675 (2006) — Cited for the definition of conclusiveness of judgment.

• Rule 39, Sections 47(b) and 47(c), Rules of Court — Embodies the two aspects of res judicata. The Court found neither applicable because the subject matter and cause of action in the two cases were different.

• Articles 494, 870, and 1083, Civil Code — These provisions collectively limit the duration of co-ownership and the prohibition to partition property to twenty years. Article 494 allows an agreement to keep property undivided for a period not exceeding ten years, extendible by a new agreement. Article 870 provides that a testamentary prohibition to partition cannot exceed twenty years. Article 1083 states that the testator may prohibit partition for a period not exceeding twenty years. The Court applied these to void the perpetual indivisibility of the Manila property.

Associate Justice Lucas P. Bersamin, Associate Justice Mariano C. Del Castillo, Associate Justice Roberto A. Abad, Associate Justice Martin S. Villarama, Jr. Associate Justice Conchita Carpio Morales authored the decision and attested to the consultation. Chief Justice Renato C. Corona certified the decision.