Debts owed to a Deceased Relative Are Transmitted to the Heirs upon his or her death
The rights, properties, and obligations of a deceased person, or a decedent, is automatically transmitted to his or her heirs upon the decedent’s death. This includes the right of the heirs over the credit due to the decedent and the right to file proper actions to claim sums of money that are due to the estate of the deceased.
Hence, the heirs of a decedent have legal standing to institute ordinary civil actions on behalf of the estate of the decedent, or be a party thereto, since the properties, rights, and obligations of heirs over the properties left behind by the decedent are automatically vested upon such heirs upon the death of the decedent.
Applicable Provisions of the Civil Code of the Philippines
On this note, Articles 774, 776, and 777 of the Civil Code of the Philippines provide, to wit:
“Article 774. Succession is a mode of acquisition by virtue of which the property, rights, and obligations to the extent of the value of the inheritance, of a person are transmitted through his death to another or others either by his will or by operation of law.
Article 776. The inheritance includes all the property, rights and obligations of a person which are not extinguished by his death.
Article 777. The rights to the succession are transmitted from the moment of the death of the decedent.” [Emphasis and underscoring supplied.]
Clearly, the property, rights, and obligations, of a decedent are transmitted through his death to his heirs by his will or by operation of law from the moment of his death.
Heirs of a Decedent are Proper Parties to File Collection Cases
This is further elucidated in the recent case of Treyes vs. Larlar[1], where the Supreme Court held that, legal heirs of a decedent are the parties-in-interest to commence ordinary actions arising out of the rights belonging to the deceased, to wit:
“In Gayon v. Gayon, in denying the argument posed by the defendants therein that they cannot be made defendants in a suit filed against the decedent because “heirs cannot represent the dead defendant, unless there is a declaration of heirship,” the Court held that the heirs may be sued even without a prior declaration of heirship made in a special proceeding:
Inasmuch, however, as succession takes place, by operation of law, “from the moment of the death of the decedent” and “(t)he inheritance includes all the property, rights and obligations of a person which are not extinguished by his death,” it follows that if his heirs were included as defendants in this case, they would be sued, not as “representatives” of the decedent, but as owners of an aliquot interest in the property in question, even if the precise extent of their interest may still be undetermined and they have derived it from the decedent. Hence, they may be sued without a previous declaration of heirship x x x.
In Bonilla, et al. v. Barcena, et al., an ordinary civil action was instituted by a surviving spouse to quiet title over certain parcels of land. When the surviving spouse passed away during the pendency of the action, the lower court immediately dismissed the case on the ground that a dead person cannot be a real party in interest and has no legal personality to sue. The Court reversed the lower court’s ruling, holding that the right of the heirs to the property of the deceased vests in them even before judicial declaration of heirship in a special proceeding. Thus, the lower court should have allowed the substitution by the heirs of the deceased even without any prior judicial determination of their status as heirs:
The respondent Court, however, instead of allowing the substitution, dismissed the complaint on the ground that a dead person has no legal personality to sue. This is a grave error. Article 777 of the Civil Code provides “that the rights to the succession are transmitted from the moment of the death of the decedent.” From the moment of the death of the decedent, the heirs become the absolute owners of his property, subject to the rights and obligations of the decedent, and they cannot be deprived of their rights thereto except by the methods provided for by law. The moment of death is the determining factor when the heirs acquire a definite right to the inheritance whether such right be pure or contingent. The right of the heirs to the property of the deceased vests in them even before judicial declaration of their being heirs in the testate or intestate proceedings. When Fortunata Barcena, therefore, died her claim or right to the parcels of land in litigation in Civil Case No. 856, was not extinguished by her death but was transmitted to her heirs upon her death. Her heirs have thus acquired interest in the properties in litigation and became parties in interest in the case. There is, therefore, no reason for the respondent Court not to allow their substitution as parties in interest for the deceased plaintiff.
Subsequently, the Court dealt with the same issue in Baranda, et al. v. Baranda, et al., wherein the therein petitioners, claiming to be the legitimate heirs of the decedent, filed a complaint against the therein respondents for the annulment of the sale and the reconveyance of the subject lots. While the lower court initially ruled in favor of the therein petitioners, the appellate court reversed the lower court’s ruling because, among other reasons, the therein petitioners are not real parties in interest, having failed to establish in a prior special proceeding their status as heirs.
The Court reversed the appellate court’s ruling and held that the legal heirs of a decedent are the parties in interest to commence ordinary actions arising out of the rights belonging to the deceased, without separate judicial declaration as to their being heirs of said decedent, provided only that there is no pending special proceeding for the settlement of the decedent’s estate:
There is also the issue of the capacity to sue of the petitioners who, it is claimed by the private respondents, are not the proper parties to question the validity of the deed of sale. The reason given is that they are not the legitimate and compulsory heirs of Paulina Baranda nor were they parties to the challenged transactions.
x x x
As heirs, the petitioners have legal standing to challenge the deeds of sale purportedly signed by Paulina Baranda for otherwise property claimed to belong to her estate will be excluded therefrom to their prejudice. Their claims are not merely contingent or expectant, as argued by the private respondents, but are deemed to have vested in them upon Paulina Baranda’s death in 1982, as, under Article 777 of the Civil Code, “the rights to the succession are transmitted from the moment of the death of the decedent.” While they are not compulsory heirs, they are nonetheless legitimate heirs and so, since they “stand to be benefited or injured by the judgment or suit,” are entitled to protect their share of successional rights.
This Court has repeatedly held that “the legal heirs of a decedent are the parties in interest to commence ordinary actions arising out of the rights belonging to the deceased, without separate judicial declaration as to their being heirs of said decedent, provided that there is no pending special proceeding for the settlement of the decedent’s estate.”“[Emphasis and underscoring supplied.]
In the case of Cabuyao vs. Caagbay, et al.[2],the Supreme Court pronounced that the right to assert a cause of action as an alleged heir, although he has not been judicially declared to be so, has been acknowledged in a catena of cases, and held that:
“The property of the deceased, both real and personal, became the property of the heir by the mere fact of death of his predecessor in interest, and he could deal with it in precisely the same way in which the deceased could have dealt with it, subject only to the limitations which by law or by contract were imposed upon the deceased himself. … (Suiliong and Co. vs. Marine Insurance Co., Ltd., et al., 12 Phil., 13, 19.)
Claro Quizon died in 1902. It was proven at the trial that the present plaintiffs are the next of kin and heirs, but it is said by the appellant that they are not entitled to maintain this action because there is no evidence that any proceedings have been taken in court for the settlement of the estate of Claro Quison, and that, without such settlement, the heirs can not maintain this action. There is nothing in this point. As well by the Civil Code as by the Code of Procedure, the title to property owned by a person who dies intestate passes at once to his heirs. Such transmission is, under the present law, subject to the claim of administration and the property may be taken from the heirs for the purposes of paying debts and expenses, but this does not prevent the immediate passage of the title, upon the death of the intestate, from himself to his heirs. Without some showing that a judicial administrator had been appointed in proceedings to settle the estate of Claro Quison, the right of the plaintiffs to maintain this action is established. (Quison vs. Salud, 12 Phil., 109, 113-114.).
x x x
If heirs succeed the deceased by their own right and operation of law in all his rights and obligation by the mere fact of his death, it is unquestionable that the plaintiff, in fact and in law, succeeded her parents and acquired the ownership of the land referred to in the said title, by the mere fact of their death. (Arts 440, 657, 658, 659, and 661, Civil Code.)
Even in the event that there should be a coheir or a coowner of the parcel of land in question, once the right of the plaintiff, and consequently her personality, has been proven the defendant has no right to dispute them, … .” (Lubrico vs. Arbado, 12 Phil., 391, 396-397.)
There is no legal precept or established rule which imposes the necessity of a previous legal declaration regarding their status as heirs to an intestate estate on those who, being of age and with legal capacity, consider themselves the legal heirs of a person, in order that they may maintain an action arising out of a right which belonged to their ancestor. (Hernandez vs. Padua, syllabus, 14 Phil., 194.)” [Emphasis and underscoring supplied.]
This ruling was reiterated in the following case of Severina Marabilles, et al. vs. Alejandro Quito and Aido Quito[3]:
“One of the grounds on which the lower court dismissed the complaint is that plaintiffs do not have legal capacity to sue because it appears that the title of the land was issued in the name of Patricio Marabiles who already died and the complaint does not allege that Severina Marabiles and her child who now appears as plaintiffs had been duly declared as his heirs to entitle them to bring the action. The court is of the impression that judicial declaration of heirship is necessary in order that an heir may have legal capacity to bring the action to recover a property belonging to the deceased.
This theory is erroneous. The right to assert a cause of action as an heir, although he has not been judicially declared to be so, if duly proven, is well settled in this jurisdiction. This is upon the theory that the property of a deceased person, both real and personal, becomes the property of the heir by the mere fact of death of his predecessor in interest, and as such he can deal with it in precisely the same way in which the deceased could have dealt, subject only to the limitations which by law or by contract may be imposed upon the deceased himself (Suiliong & Co. v. Marine Insurance Co., Ltd., et al., 12 Phil., 13, 19). Thus, it has been held that “There is no legal precept or established rule which imposes the necessity of a previous legal declaration regarding their status as heirs to an intestate on those who, being of age and with legal capacity, consider themselves the legal heirs of a person, in order that they may maintain an action arising out of a right which belonged to their ancestor” (Hernandez v. Padua, 14 Phil., 194). A recent case wherein this principle was maintained is Cabuyao v. Gaagbay, 95 Phil., 614.
Another ground on which the dismissal is predicted is that the complaint states no cause of action because while it appears in the complaint that the land was transferred to one Guadalupe Saralde, deceased wife of defendant Alejandro Quito, there is no allegation that said Alejandro Quito and his daughter Aida, a co-defendant, had been declared heirs or administrators of the estate of the deceased. Because of this legal deficiency, the court has concluded that plaintiffs have no cause of action against defendants because there is no legal bond by which the latter may be linked with the property.
This conclusion is also erroneous. The rule is that, to determine the sufficiency of a cause of action on a motion to dismiss, only the facts alleged in the complaint should be considered, and considering the facts herein alleged, there is enough ground to proceed with the case. Thus, it appears in the complaint that Guadalupe Saralde is the wife of Alejandro Quito, the defendant, and as said Guadalupe has already died, under the law, the husband and his daughter Aida are the legal heirs. We have already said that in order that an heir may assert his right to the property of a deceased, no previous judicial declaration of heirship is necessary. It was therefore a mistake to dismiss the complaint on this ground.” [Emphasis and underscoring supplied.]
In the later case of Raymundo vs. Vda. De Suarez[4], the Supreme Court further explained that:
“Even without delving into the Extrajudicial Settlement of Marcelo Sr.’s estate in 1957, it must be stressed that herein respondents’ rights to the succession vested from the moment of their father’s death. Herein respondents’ ownership of the subject properties is no longer inchoate; it became absolute upon Marcelo’s death, although their respective shares therein remained pro-indiviso. Ineluctably, at the time the subject properties were sold on execution sale to answer for Teofista’s judgment obligation, the inclusion of herein respondents’ share therein was null and void.”
It is crystal clear from the above cases that the legal standing of heirs to commence ordinary actions arising out of the rights belonging to the deceased has long been recognized in a catena of cases decided by the Supreme Court.
Hence, the heirs of one who has passed away can file an action against the debtor to collect a debt owed by the latter to their deceased relative.
The Heirs may File a Collection Case without need of Prior Settlement of the Decedent’s Estate
The settlement of the estate of a decedent is not a pre-requisite before an heir may institute an action against third parties on behalf of the estate, since the rights over the properties of the deceased are automatically transmitted to the heirs upon the death of the decedent.
This is established in the case of Socorro Clemente vs. Republic of the Philippines[5], where the Supreme Court ruled that:
“Moreover, there is no need for the settlement of the estate before one of the heirs can institute an action on behalf of the other co-heirs. Although an heir’s right in the estate of the decedent which has not been fully settled and partitioned is merely inchoate, Article 493 of the Civil Code gives the heir the right to exercise acts of ownership. Thus, even before the settlement of the estate, an heir may file an action for reconveyance of possession as a co-owner thereof, provided that such heir recognizes and acknowledges the other co-heirs as co-owners of the property as it will be assumed that the heir is acting on behalf of all the co-heirs for the benefit of the co-ownership.” [Emphasis and underscoring supplied.]
The Supreme Court further explained in the recent Treyes case[6] that:
“Given the clear dictates of the Civil Code that the rights of the heirs to the inheritance vest immediately at the precise moment of the decedent’s death even without judicial declaration of heirship, and the various Court En Banc and Division decisions holding that no prior judicial declaration of heirship is necessary before an heir can file an ordinary civil action to enforce ownership rights acquired by virtue of succession through the nullification of deeds divesting property or properties forming part of the estate and reconveyance thereof to the estate or for the common benefit of the heirs of the decedent, the Court hereby resolves to clarify the prevailing doctrine.
Accordingly, the rule laid down in Ypon, Yaptinchay, Portugal, Reyes, Heirs of Gabatan v. Court of Appeals, and other similar cases, which requires a prior determination of heirship in a separate special proceeding as a prerequisite before one can file an ordinary civil action to enforce ownership rights acquired by virtue of succession, is abandoned.
Henceforth, the rule is: unless there is a pending special proceeding for the settlement of the decedent’s estate or for the determination of heirship, the compulsory or intestate heirs may commence an ordinary civil action to declare the nullity of a deed or instrument, and for recovery of property, or any other action in the enforcement of their ownership rights acquired by virtue of succession, without the necessity of a prior and separate judicial declaration of their status as such. The ruling of the trial court shall only be in relation to the cause of action of the ordinary civil action, i.e., the nullification of a deed or instrument, and recovery or reconveyance of property, which ruling is binding only between and among the parties.” [Emphasis and underscoring supplied.]
In view of all the foregoing, it is evident that the settlement of the estate of the decedent is not a prerequisite before an heir can institute an ordinary action against third parties on behalf of the estate. This is because the rights over the properties, rights, and obligations of the deceased are automatically transmitted to the heirs upon the death of the decedent.
By the mere fact of death, the heirs can deal with the decedent’s properties, rights, and obligations precisely the same way in which the deceased could have dealt with the same had he not passed away.
Thus, the heirs of a decedent person may institute a case for collection of a sum of money against a debtor of the decedent, and a prior settlement of the estate of the decedent is not a requirement before instituting the collection case.
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[1] G.R. No. 232579, 08 September 2020.
[2] G.R. No. L-6636, 02 August 1954.
[3] G.R. No. L-10408, 18 October 1956.
[4] G.R. No. 149017, 28 November 2008.
[5] G.R. No. 220008, 20 February 2019.
[6] G.R. No. 232579, 08 September 2020.
