ALLISON D. GIBBS, PETITIONER AND APPELLEE, VS. THE GOVERNMENT OF THE PHILIPPINE ISLANDS, OPPOSITOR AND APPELLANT. THE REGISTER OF DEEDS OF THE CITY OF MANILA, RESPONDENT AND APP…

This is an appeal from a final order of the Court of First Instance of
Manila, requiring the register of deeds of the City of Manila to cancel
certificates of title Nos. 20880, 28336 and 28331, covering lands
located in the City of Manila, Philippine Islands, and issue in lieu
thereof new certificates of transfer of title in favor of Allison D.
Gibbs without requiring him to present any document showing that the
succession tax due under Article XI of Chapter 40 of the Administrative
Code has been paid.

The said order of court of March 10,
1931, recites that the parcels of land covered by said certificates of
title formerly belonged to the conjugal partnership of Allison D. Gibbs
and Eva Johnson Gibbs; that the latter died intestate in Palo Alto,
California, on November 28, 1929; that at the time of her death she and
her husband were citizens of the State of California and domiciled
therein.

It appears further from said order that Allison D.
Gibbs was appointed administrator of the estate of his said deceased
wife in case No. 36795 in the same court, entitled “In the Matter of
the Intestate Estate of Eva Johnson Gibbs, Deceased”; that in said
intestate proceedings, the said Allison D. Gibbs, on September 22,
1930, filed an ex parte petition in which he alleged “that
the parcels of land hereunder described belong to the conjugal
partnership of your petitioner and his wife, Eva Johnson Gibbs”,
describing in detail the three tracts here involved; and further
alleging that his said wife, a citizen and resident of California, died
on November 28, 1929; that in accordance with the law of California,
the community property of spouses who are citizens of California, upon
the death of the wife previous to that of the husband, belongs
absolutely to the surviving husband without administration; that the
conjugal partnership of Allison D. Gibbs and Eva Johnson Gibbs,
deceased, has no obligations or debts and no one will be prejudiced by
adjudicating said parcels of land (and seventeen others not here
involved) to be the absolute property of the said Allison D. Gibbs as
sole owner. The court granted said petition and on September 22, 1930,
entered a decree adjudicating the said Allison D. Gibbs to be the sole
and absolute owner of said lands, applying section 1401 of the Civil
Code of California. Gibbs presented this decree to the register of
deeds of Manila and demanded that the latter issue to him a “transfer
certificate of title”.

Section 1547 of Article XI of Chapter 40 of the Administrative Code provides in part that:

“Registers
of deeds shall not register in the registry of property any document
transferring real property or real rights therein or any chattel
mortgage, by way of gifts mortis causa, legacy or
inheritance, unless the payment of the tax fixed in this article and
actually due thereon shall be shown. And they shall immediately notify
the Collector of Internal Revenue or the corresponding provincial
treasurer of the nonpayment of the tax discovered by them.

Acting upon the authority of said section, the register of deeds of the
City of Manila, declined to accept as binding said decree of court of
September 22, 1930, and refused to register the transfer of title of
the said conjugal property to Allison D. Gibbs, on the ground that the
corresponding inheritance tax had not been paid. Thereupon, under date
of December 26, 1930, Allison D. Gibbs filed in the said court a
petition for an order requiring the said register of deeds “to issue
the corresponding titles” to the petitioner without requiring previous
payment of any inheritance tax. After due hearing of the parties, the
court reaffirmed said order of September 22,1930, and entered the order
of March 10, 1931, which is under review on this appeal.

On
January 3, 1933, this court remanded the case to the court of origin
for new trial upon additional evidence in regard to the pertinent law
of California in force at the time of the death of Mrs. Gibbs, also
authorizing the introduction of evidence with reference to the dates of
the acquisition of the property involved in this suit and with
reference to the California law in force at the time of such
acquisition. The case is now before us with the supplementary evidence.

For the purposes of this case, we shall consider the following facts as
established by the evidence or the admissions of the parties: Allison
D. Gibbs has been continuously, since the year 1902, a citizen of the
State of California and domiciled therein; that he and Eva Johnson
Gibbs were married at Columbus, Ohio, in July, 1906; that there was no
antenuptial marriage contract between the parties; that during the
existence of said marriage, the spouses acquired the following lands,
among others, in the Philippine Islands, as conjugal property:

1. A parcel of land in the City of Manila, represented by transfer
   certificate of title No. 20880, dated March 16, 1920, and registered in
   the name of “Allison D. Gibbs casado con Eva Johnson Gibbs”.

2. A parcel of land in the City of Manila, represented by transfer
   certificate of title No. 28336, dated May 14, 1927, in which it is
   certified “that the spouses Allison D. Gibbs and Eva Johnson Gibbs are
   the owners in fee simple” of the land therein described.

3. A parcel of land in the City of Manila, represented by transfer
   certificate of title No. 28331, dated April 6, 1927, which states “that
   Allison D. Gibbs married to Eva Johnson Gibbs” is the owner of the land
   described therein; that said Eva Johnson Gibbs died intestate on
   November 28, 1929, leaving surviving her her husband, the appellee, and
   two sons, Allison J. Gibbs, now aged 25, and Finley J. Gibbs, now aged
   22, as her sole heirs at law.

Article XI of Chapter 40 of the Administrative Code entitled “Tax on inheritances, legacies, and other acquisitions mortis causa”
provides in section 1536 that “Every transmission by virtue of
inheritance * * * of real property * * * shall be subject to the
following tax.” It results that the question for determination in this
case is as follows: Was Eva Johnson Gibbs at the time of her death the
owner of a descendible interest in the Philippine lands above-mentioned?

The appellee contends that the law of California should determine the
nature and extent of the title, if any, that vested in Eva Johnson
Gibbs under the three certificates of title Nos. 20880, 28336 and 28331
above referred to, citing article 9 of the Civil Code. But that, even
if the nature and extent of her title under said certificates be
governed by the law of the Philippine Islands, the laws of California
govern the succession to such title, citing the second paragraph of
article 10 of the Civil Code.

Article 9 of the Civil Code is as follows:

“The
laws relating to family rights and duties, or to the status, condition,
and legal capacity of persons, are binding upon Spaniards even though
they reside in a foreign country.” It is argued that the conjugal right
of the California wife in community real estate in the Philippine
Islands is a personal right and must, therefore, be settled by the law
governing her personal status, that is, the law of California. But our
attention has not been called to any law of California that
incapacitates a married woman from acquiring or holding land in a
foreign jurisdiction in accordance with the lex rei sitæ.
There is not the slightest doubt that a California married woman can
acquire title to land in a common law jurisdiction like the State of
Illinois or the District of Columbia, subject to the common-law estate
by the curtesy which would vest in her husband. Nor is there any doubt
that if a California husband acquired land in such a jurisdiction his
wife would be vested with the common law right of dower, the
prerequisite conditions obtaining. Article 9 of the Civil Code treats
of purely personal relations and status and capacity for juristic acts,
the rules relating to property, both personal and real, being governed
by article 10 of the Civil Code. Furthermore, article 9, by its very
terms, is applicable only to “Spaniards” (now, by construction, to
citizens of the Philippine Islands).

The
Organic Act of the Philippine Islands (Act of Congress, August 29,
1916, known as the “Jones Law”) as regards the determination of private
rights, grants practical autonomy to the Government of the Philippine
Islands. This Government, therefore, may apply the principles and rules
of private international law (conflict of laws) on the same footing as
an organized territory or state of the United States. We should,
therefore, resort to the law of California, the nationality and
domicile of Mrs. Gibbs, to ascertain the norm which would be applied
here as law were there any question as to her status.

But
the appellant’s chief argument and the sole basis of the lower court’s
decision rests upon the second paragraph of article 10 of the Civil
Code which is as follows:

“Nevertheless,
legal and testamentary successions, in respect to the order of
succession as well as to the amount of the successional rights and the
intrinsic, validity of their provisions, shall be regulated by the
national law of the person whose succession is in question, whatever
may be the nature of the property or the country in which it may be
situated.”

In construing the above language
we are met at the outset with some difficulty by the expression “the
national law of the person whose succession is in question”, by reason
of the rather anomalous political status of the Philippine Islands.
(Cf. Manresa, vol. 1, Codigo Civil, pp. 103, 104.) We encountered no difficulty in applying article 10 in the case of a citizen of Turkey. (Miciano vs.
Brimo, 50 Phil., 867.) Having regard to the practical autonomy of the
Philippine Islands, as above stated, we have concluded that if article
10 is applicable and the estate in question is that of a deceased
American citizen, the succession shall be regulated in accordance with
the norms of the State of his domicile in the United States. (Cf.
Babcock Templeton vs. Rider Babcock, 52 Phil., 130, 137; In re Estate of Johnson, 39 Phil., 156, 166.)

The trial court found that under the law of California, upon the death
of the wife, the entire community property without administration
belongs to the surviving husband; that he is the absolute owner of all
the community property from the moment of the death of his wife, not by
virtue of succession or by virtue of her death, but by virtue of the
fact that when the death of the wife precedes that of the husband he
acquires the community property, not as an heir or as the beneficiary
of his deceased wife, but because she never had more than an inchoate
interest or expectancy which is extinguished upon her death. Quoting
the case of Estate of Klumpke (167 Cal., 415, 419), the court said:
“The decisions under this section (1401 Civil Code of California) are
uniform to the effect that the husband does not take the community
property upon the death of the wife by succession, but that he holds it
all from the moment of her death as though acquired by himself. * * *
It never belonged to the estate of the deceased wife.”

The
argument of the appellee apparently leads to this dilemma: If he takes
nothing by succession from his deceased wife, how can the second
paragraph of article 10 be invoked? Can the appellee be heard to say
that there is a legal succession under the law of the Philippine
Islands and no legal succession under the law of California? It seems
clear that the second paragraph of article 10 applies only when a legal
or testamentary succession has taken place in the Philippines in
accordance with the law of the Philippine Islands; and the foreign law
is consulted only in regard to the order of succession or the extent of
the successional rights; in other words, the second paragraph of
article 10 can be invoked only when the deceased was vested with a
descendible interest in property within the jurisdiction of the
Philippine Islands.

In the case of Clarke vs. Clarke (178 U. S., 186, 191; 44 Law. ed., 1028, 1031), the court said:

“It
is a principle firmly established that to the law of the state in which
the land is situated we must look for the rules which govern its
descent, alienation, and transfer, and for the effect and construction
of wills and other conveyances. (United States vs. Crosby, 7 Cranch, 115; 3 L. ed., 287; Clark vs. Graham, 6 Wheat., 577; 5 L. ed., 334; McGoon vs. Scales, 9 Wall., 23; 19 L. ed., 545; Brine vs. Hartford F. Ins. Co., 96 U. S., 627; 24 L. ed., 858.)” (See also
Estate of Lloyd, 175 Cal., 704, 705.) This fundamental principle is
stated in the first paragraph of article 10 of our Civil Code as
follows: “Personal property is subject to the laws of the nation of the
owner thereof; real property to the laws of the country in which it is
situated.”

It is stated in 5 Cal. Jur., 478:

“In accord with the rule that real property is subject to the lex rex sitæ,
the respective rights of husband and wife in such property, in the
absence of an antenuptial contract, are determined by the law of the
place where the property is situated, irrespective of the domicile of
the parties or of the place where the marriage was celebrated.” (See also Saul vs. His Creditors, 5 Martin [N. S.], 569; 16 Am. Dec., 212 [La.]; Heidenheimer vs. Loring, 26 S. W., 99 [Texas].)

Under this broad principle, the nature and extent of the title which
vested in Mrs. Gibbs at the time of the acquisition of the community
lands here in question must be determined in accordance with the lex rei sitæ.

It is admitted that the Philippine lands here in question were acquired
as community property of the conjugal partnership of the appellee and
his wife. Under the law of the Philippine Islands, she was vested of a
title equal to that of her husband. Article 1407 of the Civil Code
provides:

“All the property of the spouses
shall be deemed partnership property in the absence of proof that it
belongs exclusively to the husband or to the wife.” Article 1395
provides:

“The conjugal partnership shall be governed by
the rules of law applicable to the contract of partnership in all
matters in which such rules do not conflict with the express provisions
of this chapter.” Article 1414 provides that “the husband may dispose
by will of his half only of the property of the conjugal partnership.”
Article 1426 provides that upon dissolution of the conjugal partnership
and after inventory and liquidation, “the net remainder of the
partnership property shall be divided share and share alike between the
husband and wife, or their respective heirs.” Under the provisions of
the Civil Code and the jurisprudence prevailing here, the wife, upon
the acquisition of any conjugal property, becomes immediately vested
with an interest and title therein equal to that of her husband,
subject to the power of management and disposition which the law vests
in the husband. Immediately upon her death, if there are no obligations
of the decedent, as is true in the present case, her share in the
conjugal property is transmitted to her heirs by succession. (Articles
657, 659, 661, Civil Code; cf. also Coronel vs. Ona, 33 Phil., 456, 469.)

It results that the wife of the appellee was, by the law of the
Philippine Islands, vested of a descendible interest, equal to that of
her husband, in the Philippine lands covered by certificates of title
Nos. 20880, 28336 and 28331, from the date of their acquisition to the
date of her death. That appellee himself believed that his wife was
vested of such a title and interest is manifest from the second of said
certificates, No. 28336, dated May 14, 1927, introduced by him in
evidence, in which it is certified that “the spouses Allison D. Gibbs
and Eva Johnson Gibbs are the owners in fee simple of the conjugal
lands therein described.”

The descendible interest of Eva
Johnson Gibbs in the lands aforesaid was transmitted to her heirs by
virtue of inheritance and this transmission plainly falls within the
language of section 1536 of Article XI of Chapter 40 of the
Administrative Code which levies a tax on inheritances. (Cf. Re
Estate of Majot, 199 N. Y., 29; 92 N. E., 402; 29 L. R. A. [N. S.],
780.) It is unnecessary in this proceeding to determine the “order of
succession” or the “extent of the successional rights” (article 10,
Civil Code, supra) which would be regulated by section 1386
of the Civil Code of California which was in effect at the time of the
death of Mrs. Gibbs.

The record does not show what the
proper amount of the inheritance tax in this case would be nor that the
appellee (petitioner below) in any way challenged the power of the
Government to levy an inheritance tax or the validity of the statute
under which the register of deeds refused to issue a certificate of
transfer reciting that the appellee is the exclusive owner of the
Philippine lands included in the three certificates of title here
involved.

The judgment of the court below of March 10, 1931,
is reversed with directions to dismiss the petition, without special
pronouncement as to the costs.

Avanceña, C. J., Malcolm, Villa-Real, Abad Santos, Hull, and Vickers, JJ., concur.

Street, J., dissents.