INTESTATE PROCEEDINGS OF THE DECEASED PEDRO ROYO. AMPARO M. VDA. DE ROYO, ADMINISTRATRIX OF THE ESTATE OF PEDRO ROYO AND PEDRO ROYO, JR., MOVANTS AND APPELLANTS, VS. N. T. DEEN …

Royo versus Deen

The Case

This is the case of Royo versus Deen, an intestate proceeding that began in the Court of First Instance of Cebu and reached the Supreme Court on pure questions of law. The administratrix and an heir of the estate of Pedro Royo sought to enforce against the bondsmen of the deceased administrator, Pantaleon del Rosario, a bond of twenty five thousand pesos, to answer for seventeen thousand six hundred ten pesos that the administrator allegedly failed to account for. The bondsmen, N. T. Deen and Tomas Delgado, opposed the motion. The case matters because it teaches when a fiduciary's long uncontested report, followed by years of silence from the heirs, bars a later claim against his sureties on the ground of laches and estoppel.

Procedural History

The motion to enforce the bond was filed in the Court of First Instance of Cebu in November 1940. In a decision dated May 1941, the trial judge, Justice Felix Martinez, denied the motion. The movants appealed to the Court of Appeals, but that court endorsed the case to the Supreme Court because all the issues raised involved questions of law. The Supreme Court then reviewed the judgment of the trial court directly.

Facts

Pantaleon del Rosario was appointed administrator of the estate of Pedro Royo in October 1924, replacing Jose Vano. As administrator he received forty three thousand five hundred pesos from the sale of two houses of strong materials and zinc roofing belonging to the estate. From that sum he disbursed twenty four thousand eight hundred ninety pesos, supported by receipts, in payment of claims against the administration, leaving a balance of seventeen thousand six hundred ten pesos. The record does not show what he did with that balance.

In September 1928, del Rosario filed a written manifestation stating that the heirs, who were already of legal age, had disposed of a great portion of the estate funds, that he retained only what was needed to pay the debts, and that after the court ordered the sale of the estate properties in January 1928 there was a small deficit, because all the debts had been paid and the heirs had taken the remainder. The heirs never opposed this report. Del Rosario died in November 1930, and administration proceedings for his own estate were opened, yet the heirs of Pedro Royo never presented any claim against him or against his bondsmen.

Only in November 1940, twelve years and two months after the manifestation, did the movants seek to enforce the bond against Deen and Delgado for the seventeen thousand six hundred ten pesos.

Issues

• Whether or not the trial court erred in denying the motion to enforce the administrator's bond against the bondsmen.
• Whether or not the doctrines of prescription and estoppel by laches apply against the heirs and their administratrix.
• Whether or not the trial court erred in giving full faith and credit to the unsworn manifestation filed by the former administrator in September 1928.
• Whether or not the trial court erred in ordering the closure of the case.

Applicable Provisions

Section 1 of Rule 82, on the administrator's bond, provides:

Before an executor or administrator enters upon the execution of his trust, and letters testamentary or of administration are issued, he shall give a bond to the court appointing him, conditioned upon the faithful performance of his duties.

This shows that the administrator was already bound under oath to act faithfully, so his later reports needed no further oath.

Section 9 of Rule 86, on examination of accounts, provides:

If the executor or administrator is examined on his accounts, the examination shall be under oath.

Since no opposition was ever filed to the report, no sworn examination was required.

Article 1148 of the Civil Code provides:

The solidary debtor may avail himself against the claims of the creditor of all the defenses derived from the nature of the obligation and those which are personal to him.

This allowed the bondsmen to invoke prescription and laches in their own defense.

Ruling

On the first issue, the Court affirmed the denial of the motion. The administrator's manifestation was in substance his report on the state of his accounts. The heirs never opposed it, and their silence for more than twelve years amounted to acquiescence. That silence was competent proof that he did not retain the sum claimed but used it to pay debts or delivered it to the heirs.

On the second issue, the Court held that prescription and estoppel by laches applied. The heirs never presented any claim against del Rosario's estate or against his bondsmen, and the Court found the conclusions of the trial court well founded.

On the third issue, the Court held that no further oath was needed. The administrator had already sworn to faithfully perform his duties under his bond, and since no opposition to his report was filed, a sworn examination was unnecessary.

On the fourth issue, the Court upheld the closure of the case, as the claim had been barred.

Doctrine

An administrator's report on the state of his accounts, left uncontested by the heirs, is deemed acquiesced in, and their prolonged silence bars a later claim against him or his sureties under the doctrine of laches and estoppel. The sureties may invoke such defenses under Article 1148 of the Civil Code. A report submitted in the course of administration needs no separate oath, because the administrator is already bound under his bond to faithful performance.

Disposition

The Supreme Court affirmed the judgment appealed from, with costs against the movants and appellants. The bondsmen prevailed.

Remember This

The one line to memorize: the heirs' long, unopposed silence on an administrator's report is acquiescence that bars a later claim against his bond. Examiners use this case on the requisites of laches, the effect of an uncontested administrator's report, and the defenses available to a surety.