ROSITA SANTIAGO DE BAUTISTA, ET AL., PLAINTIFFS-APPELLEES, VS. VICTORIA DE GUZMAN, ET AL., DEFENDANTS-APELLANTS.

This is an appeal from the decision of the Court of First
Instance of Rizal, Pasay City branch, in Civil Case No. 3530, ordering the
defendants-appellants to pay the plaintiffs?appellees damages and
attorney’s fees and dismissing the former’s counterclaim. As no questions of facts were raised by the
appellants in their brief, the Court of Appeals certified this case to us for
decision.

The facts, as stated in the resolution of the appellate court,
are as follows:

On May 10, 1952, Numeriano Bautista, husband and father of the plaintiffs-appellees,
respectively, was a passenger
of jeepney bearing Plate No. TPU-4013, owned and operated by Rosendo de Guzman,
deceased husband and father of defendants-appel­lants, respectively, as one of
the jeepneys used in his transportation business. Eugenio Medrano y Torres was employed by said Rosendo de Guzman as the
driver of said jeepney. Said driver
drove and managed said jeepney at that time along Taft Avenue, Pasay City, in a
negligent and reckless manner and, as a result, the jeepney turned turtle and,
con­sequently, passenger Numeriano Bautista sustained physical injuries which
caused his death. Eugenio Medrano, the
driver, was accused and convicted of homicide through reckless imprudence by
the trial court in a decision promulgated on May 27, 1952 and sentenced to a
penalty of imprisonment of four (4) months and one (1) day of arresto mayor
and to indemnify the heirs of Numeriano Bautista, plaintiffs-appel­lees herein,
in the sum of P3,000.00. A
writ of execution
was issued against said driver, Eugenio Medrano for the said sum of P3,000.00 but the same was returned to
the Court unsatisfied.

On May 12, 1952, Rosendo de Guzman died.

Because of their failure to collect the said sum of P3,000.00 from the driver, Eugenio Medrano, plaintiffs?appellees
filed a complaint (Cavil Case No. 2050) dated October 7, 1952, with the Court
of First Instance of Rizal, Pasay City Branch, against defendants-appellants
alleging, among other things besides the above?mentioned incidents, that
they demanded from Rosendo de Guzman and from the defendants-appellants the
payment of the sums of P3,000.00 as subsidiary liability; P10,000.00 as actual exemplary and
moral damages and P1,000.00 as attorney’s fees for the suit by
reason of the death of Numeriano Bautista as related above, but Rosendo de
Guzman and later the herein defendants-appellants refused to pay the same. Plaintiffs-appellees therefore prayed that the
defendants-appellants be ordered to pay the said sums as well as the costs of suit.

Defendants-appellants through counsel filed a motion to dismiss
predicated on two grounds, namely, that the lower court had no jurisdiction
over the subject matter of the litigation and that the complaint stated no
cause of action. In support of said
motion, they maintained that the suit was for a money claim against the
supposed debtor who was already dead and as such it should be filed in testate or intestate
proceed­ings or, in the absence of such
proceedings, after the lapse of thirty (30) days, the creditors should
initiate such proceedings; that the heirs could not be held liable therefor since
there was no allegation that they assumed the alleged obligation.

The lower court sustained the motion to dismiss in an order dated
May 11, 1953, stating, among other things, that:

“The procedure thus opened for a money claimant against a
deceased person, as in the instant case, is for said claimant to file
proceedings for the opening of the judicial administration of the estate of
said deceased person and to
present his claim in said
proceedings. The claimant may only
proceed to sue the heirs of the deceased directly where such heirs have entered
into an extra-judicial partition of such estate and have distributed the latter
among themselves, in which case, the heirs become liable to the claimant in
proportion to the share which they have received as inherit­ance. Plaintiffs’ com­plaint does not state that
the defendants have received any such inheritance from their said deceased
father, Rosendo de Guzman, and hence, there
is no cause of action against aforesaid defendants.”

This order became final.

Then on December 14,
1954, plaintiffs-appelless filed with
the same trial court Civil Case No. 3530 (subject of this appeal) against the
same defendants in the former case, the complaint contain­ing analogous
allegations as those embodied in the first complaint but in this second
complaint they further allege that on June 12, 1952, Rosendo de Guzman died
intestate and that intestate proceedings were filed in the same court and
docketed therein as Special Proceedings No. 1303-P, wherein on April 20, 1953,
a project of partition was presented
in and approved by said Court with the
five heirs receiving their shares valued at P2,294.05 each, and on May 14,
1953, said intestate proceed­ings were closed. They also alleged that Numeriano Bautista during his lifetime was the
only one supporting them and his death caused them shock, sufferings and
anxiety and therefore defendants-appellants should pay to them, aside from the P3,000.00, an adtional
amount of P15,000.00 as moral, exemplary and compensatory damages,
plus the sum of P2,000.00 as attorney’s fees for the prose­cution of this case, besides the costs of suit.

Defendants-appellants again filed a motion to dismiss on May 5, 1955, alleging the same
grounds as those interposed in the
first complaint but adding the further ground of res judicata in view of
the dismissal of the first case which became final as no appeal or any other
action was taken thereon by the appelees.

On August 22, 1955, the lower court denied the motion to dismiss
for lack of sufficient merit.

x x x                          x
x x                             x x x

Then on July 11, 1961, the parties through their respective counsel
submitted a partial stipulation of facts found on pages 63 to 67 of the amended
record on appeal which stipulation of facts, was made the basis of the decision
of the lower court which was ren­dered on August 26, 1961 (should be August 14,
1961), aside from the testimony of the
widow of Numeriano Bautista, appellee Rosita Bautista, who testified on the
same incidents already re­cited herein and on the sufferings and shock she and
her children, all appellees in
this case, suf­fered. From said
decision, the present appeal has been interposed x x x.”

Defendants-appellants assign the following errors:

I

THE COURT BELOW ERRED IN NOT SUSTAINING THE
MOTION TO DISMISS (MOCION DE SOBRESIMIENTO) FILED BY THE DEFENDANTS-APPELLANTS
ON OR ABOUT MAY, 1955, APPEARING ON PAGE 10 ET SEQ. OF THE AMENDED RECORD ON
APPEAL.

II

THE COURT BELOW ERRED IN NOT DECLARING THAT
THE CLAIM OF THE PLAINTIFFS-APPELLEES IS ALREADY BARRED FOR FAILURE ON THEIR
PART TO FILE THEIR CLAIM IN THE INTES­TATE PROCEEDINGS OF THE DECEASED ROSENDO
DE GUZMAN (SPECIAL PROCEED­INGS NO. 1303-P) OF THE COURT OF FIRST INSTANCE OF
RIZAL.

III

THE COURT ERRED IN NOT SUS­TAINING THE
DEFENSE OF RES JUDICATA INTERPOSED BY DEFENDANTS-APPELLANTS BY VIRTUE OF THE FINAL ORDER RENDERED OR
ISSUED BY THE COURT OF FIRST INSTANCE OF RIZAL IN CIVIL CASE NO. 2050, DATED
MAY 11, 1953, COPY OF SAID ORDER IS ATTACHED AS EXHIBIT “F” AND MADE
AN INTEGRAL PART OF THE PARTIAL STIPULATION OF FACTS.

IV

THE COURT BELOW ERRED IN RENDERING A
DECISION ORDERING THE HEREIN DEFENDANTS-APPELLANTS
TO JOINTLY AND SEVERALLY PAY THE PLAINTIFFS-APPELLEES THE SUM OF THREE
THOUSAND PESOS (P3,000.00), WITH INTERESTS AND COSTS.

V

THE COURT BELOW ERRED IN DISMISSING
DEFENDANTS-APPELLANTS’ COUNTER-CLAIM AND IN NOT RENDERING A DECISION IN
ACCORDANCE THEREWITH.

The only question presented in the assigned errors is whether or
not the trial court erred in giving due course to the complaint on the grounds
stated above. We sympathize with the
plight of the plaintiffs-appellees but they have lost their right to recover
because of neg­ligence and a failure to observe mandatory pro­visions of the
law and the Rules. They over­looked the
fact that they were no longer suing Rosendo de Guzman who died shortly after
the accident but his heirs.

Section 5, Rule 86 of the Rules of Court provides:

All claims for money against the decedent arising from contract,
express or implied, whether the same be due, not due, or contingent, all
claims for funeral expenses and expenses for the last sickness of the
decedents, and judgment for money against the decedent, must be filed within the time limited in the notice;
otherwise they are barred forever; except that they may be set forth as
counterclaims in any action that the executor or administrator may bring
against the claimants. x x x Claims not
yet due, or contingent, may be approved at their present value.

The above-quoted rule is mandatory. The requirement therein is for the purpose of pro­tecting the
estate of the deceased. The executor or
administrator is informed of the claims against it, thus enabling him to
examine each claim and to determine whether it is a proper one which should be
allowed. Therefore, upon the dismissal
of the first complaint of herein plaintiffs-appellees in Civil Case No. 2050,
they should have presented their claims before the intestate proceedings filed
in the same court and docketed as Special Proceedings No. 1303-P. Instead of doing so, however, the
plaintiffs-appellees slept on their right. They allowed said proceedings to terminate and the properties to be distributed
to the heirs pursuant to a project of partition be­fore instituting this
separate action. Such is not sanctioned
by the above rule for it strictly requires the prompt presentation and
disposition of claims against the decedent’s estate in order to settle the
affairs of the estate as soon as possible, pay off its debts and distribute the
residue. (See Py Eng Chong v. Herrera,
70 SCRA 130). With the exception provided
for in the above rule, the failure of herein plaintiffs-appellees to present their
claims before the intestate proceedings of the estate of Rosendo de Guzman
within the prescribed period constituted a bar to a subsequent claim against
the estate or a similar action of the same import.

Therefore, it was an error on the part of the trial court to hold
that the plaintiffs-appellees had a cause of action against the
defendants-appellants who are the heirs of the deceased against whom the
liability is sought to be enforced, much less take cognizance of the complaint. As in the first complaint, said court could
not have assumed jurisdiction over the second case for the simple reason that
it was no longer acting as a probate court which was the proper forum to file
such complaint. The termination of the
intestate proceedings and the distribution of the estate to the heirs did not
alter the fact that plaintiffs-appellees’ claim was a money claim which should
have been presented before the probate court. The liability of the late Rosendo de Guzman arose from the breach of his
obligations under the contract of carriage between him and the unfortunate
passenger. The obligations are spelled
out by law but the liability arose from a breach of contractual
obligations. The resulting claim is a
money claim.

The only instance wherein a creditor can file an action against a
distributee of the debtor’s asset is under Section 5, Rule 88 of the Rules of
Court which provides:

If such contingent claim becomes absolute
and is pre­sented to the court, or to the executor or administrator, within two
(2) years from the time limited for other creditors to present their claims, it
may be allowed by the court if not disputed by the executor or administrator,
and, if disputed, it may be proved and allowed or disallowed by the court as
the facts may warrant. If the
contingent claim is allowed, the creditor shall receive pay­ment to the same
extent as the other creditors if the estate retained by the executor or
administrator is sufficient. But if the
claim is not so presented, after having became absolute, within said two (2)
years, and allowed, the assets retained in the hands of the executor or
administrator, not exhausted in the payment of claims, shall be distributed by
the order of the court to the persons entitled to the same; but the assets so
distributed may still be applied to the payment of the claim when established,
and the creditor may maintain an action against the distributees to recover the
debt, and such distributees and their estates shall be liable for the debt in
proportion to the estate they have respectively received from the property of
the deceased.

Even under the above rule, the contingent claims must first have
been established and allowed in the probate court before the creditors can file
an action directly against the distributees. Such is not the situation, however, in the case at bar. The complaint herein was filed after the
intestate proceedings had terminated and the estate finally distributed to the
heirs. If we are to allow the complaint to prosper and the trial court to
take cognizance of the same, then the rules providing for the claims against
the estate in a testate or intestate proceedings within a specific period would
be rendered nugatory as a subsequent action for money claim against the
distributees may be filed indepen­dently of such proceedings. This precisely is what the rule seeks to prevent so as to avoid
further delays in the settlement of the estate of the deceased and in the
distribution of his property to the heirs, legatees or devisees.

Furthermore, even assuming that the plaintiffs-appellees had no
knowledge of the intestate proceed­ings which is not established, the law
presumes that they had such knowledge because the settlement of estate is a
proceeding in rem and therefore the failure to file their claims before such
proceedings barred them from subsequently filing the same claims outside said
proceedings.

WHEREFORE, the decision of the Court of First Instance
appealed from is hereby reversed and set aside and another one entered
dismissing the complaint and the counterclaim. No costs.

SO ORDERED.

Plana and Relova, JJ., concur.

Teehankee, (Chairman), J., in
the result.

Melencio-Herrera, J.,
concurring in the result in a separate opinion.