H.P. HOSKYNS, AS ADMINISTRATOR OF INTESTATE ESTATE OF J.E.H. STEVENOT, PLAINTIFF AND APPELLEE, VS. NATIONAL CITY BANK OF NEW YORK, DEFENDANT AND APPELLANT; WELLS FARGO BANK AND …

This is an action for a declaratory relief filed in the Court
of First Instance of Manila. The judgment is in favor of the plaintiff, H.P.
Hoskyns, and the National City Bank of New York, defendant, and Wells Fargo Bank
and Union Trust Co., intervenor, has appealed.

The facts and allegations necessary to a proper under standing
and determination of the case may be condensed as follows:

J.E.H. Stevenot, a citizen of the United States and of the
State of California, died in New Caledonia on June 8, 1943, while serving as an
officer of the U. S. Army. He was survived by his widow, Elma Kimball Stevenot,
and two daughters, Myre Gene Stevenot and Shirley Joanne Stevenot, who are all
at present in the United States. For more than ten years immediately prior to
his death, J. E. H. Stevenot had been a resident of the Philippines and upon his
death left real and personal properties situated therein, properties which he
acquired during his married life.

On April 19, 1943, while in California, Stevenot executed a
private written instrument, agreed to by his wife, in which he appointed himself
as trustor or trustee of his properties and declared that he was holding them in
trust for the beneficiaries named therein including his wife, daughters, and
other relatives. The deed of trust provided that Stevenot should himself have a
life interest in the trust properties and that after his death the income and
corpus should go principally to his wife and family.

The trust indenture provided finally that upon Stevenot’s
death, Wells Fargo Bank and Union Trust Co. should succeed as trustee for the
properties located in the United States and the National City Bank of New York
at Manila for the properties in the Philippines. Both of these trustees accepted
the trust.

After Stevenot’s death, administration proceedings were
commenced in the Court of First Instance of Manila, H. P. Hoskyns, plaintiff in
the instantaction, being appointed as administrator. The application for
Hoskyns’ appointment as administrator was made by the present attorneys for the
defendant and appellant and intervenor and appellant on behalf of Stevenot’s
widow.

The action for declaratory relief prays that the court
“determine the question of construction or validity of the declaration of trust
and for the declaration of the rights and duties of the defendant hereunder.” In
an amended complaint plaintiff alleges, besides the facts set forth above, that
defendant National City Bank of New York and intervenor Wells Fargo Bank and
Union Trust Co. claim the real and personal properties of Stevenot in the
Philippines which are under his administration, alleging that as Stevenot’s
successor trustees they are entitled to their possession and administration in
order to be able to dis charge their obligation under the trust for the benefits
of Stevenot’s widow, daughters, brothers and sisters, for whose accounts and
benefits the declaration of trust was created; that contrary to this claim of
the defendant and intervenor, the plaintiff believes that as administrator duly
appointed by the court of the Philippines in Special Proceeding No. 71768 of the
Court of First Instance of Manila, he has the right, to the exclusion of all
others, to the possession and administration of the deceased’s properties
located in the Philippines, subject only to the supervision, control and
approval of the estate court; that in the above intestate proceeding claims have
been presented against the estate, claims which have not yet been admitted; that
the laws and rules which outline the procedure for the admission and payment of
these claims can not be enforced if the declaration of trust be given force and
effect in the Philippines; that in view of these conflicting claims “it is
expedient to determine the construction or validity arising under the
declaration of trust above stated and for a declaration of rights and duties of
the defendant therein with respect to the properties of the deceased located in
the Philippines.”

The defendant and the intervenor maintain that the declaration
of trust is valid under the laws of California where it was executed and should
be recognized as valid in the Philippines, and pray, upon the facts stated in
the complaint, that the plaintiff be ordered to turn over to the trustees for
administration, in accordance with the terms and conditions of the declaration
of trust, all properties located in the Philippines and subject to the said
trust and which are now or which may at any time here after come into his
possession or under his control. In a well written decision, Hon. Conrado
Sanchez, Judge, held “that plaintiff H.P. Hoskyns, as administrator of the
intestate estate of the deceased J.E.H. Stevenot, is entitled to the
possession of the properties under his administration and described in Annex B
of the original complaint.” The decision is silent regarding the validity of the
trust.

In appellant’s brief (first assignment of error) the trial
court is alleged to have “erred in not holding that J.E.H. Stevenot created a
valid trust and in not giving effect to the provisions of the trust
indenture.”

We think that the court below properly declined or omitted to
make declarations regarding the validity of the trust agreement. Section 3 of
Rule 66 enjoins that “when declaratory relief is sought, all persons shall be
made parties who have or claim any interest which will be affected by the
declaration,” while section 6 authorizes the courts to “refuse to exercise the
power to declare rights and to construe instruments where a decision under it
would not terminate the uncertainty or controversy which gave rise to the
action.”

The persons most vitally if not solely affected by the validity
or invalidity of the trust are the widow, daughters, other heirs, and the
creditors of the deceased. None of them are before the court now, and without
them any decision on the validity or invalidity of the trust would not put an
end to the uncertainty or controversy which the administrator and the trustees
wish to have clarified and adjudicated. Not being parties to this suit, the
heirs and the creditors would not be bound by any judgment holding the trust
valid or invalid and might later “raise the identical issue and deprive the
declaration of that final and pacifying function it is calculated to
subserve.”

The judicial administrator and the trustees, it is evident, are
not concerned about the intrinsic validity of the trust. They are concerned at
the most with who, as between them, should have possesssion of and manage the
properties involved in the trust. The latter question is independent of, and
would not be concluded by, a declaration that that instrument should be given
force and effect in this jurisdiction. Regardless of the validity or invalidity
of the trust, the Philippine courts may assert jurisdiction in the
administration of trust properties located in the Philippines to protect the
beneficiaries or creditors. (Sections 1 and 5, Rule 99.)

The appellants object that the basic question on this appeal is
as to whether the trust was validly created; they are not, they insist,
interested in the estate proceedings now pending in court. If this were correct,
we could stop right here, having dismissed and disposed of the first point. The
truth of the matter, however, is that the second assignment of error assails the
decision precisely for “not directing H.P. Hoskyns, * * *, to turn over to the
successor-trustees under the trust created by J.E.H. Stevenot possession and
control of the properties located in the Philippines which were the subject of
the trust.” And in defendant’s and intervenor’s answers and in their motions
for summary judgments on the pleadings they asked the same relief. More, the
ultimate desire of the trustees, as we see it, is the virtual revocation of the
plaintiff’s appointment as administrator, the quashing of intestate proceeding
No. 71768, and the turning over of the estate to them. It can be gathered from
the pleadings and argument that the parties seek a declaration of the validity
of the trust indenture mainly because of the notion that if the trust is valid
the right of the trustees to take charge of the estate for administration and
settlement should follow. This belief can also be inferred from the contention
in the first assignment of error transcribed above, namely, that effect should
be given to the provisions of the trust indenture on the premise that that
instrument was validly created. The effect referred to can be no other than the
delivery of the properties to the trustees.

Nevertheless, His Honor the trial Judge should have refrained,
in our opinion, from entering a judgment on the conflicting claims of the
parties over the control and administration of the estate, just as he refrained
from passing on the validity of the trust. The parties should be referred to the
intestate proceeding where this matter belongs and where the purpose of the
parties, which in effect is the removal or revocation of the appointment of the
plaintiff as administrator, can be more than conveniently accomplished with the
simple device of filing a motion or petition to that end. In fact, it is in that
proceeding and in the court which appointed him where the plaintiff could, with
absolute propriety and without violating the prescribed practice and procedure,
obtain a ruling on his right to continue as administrator. If the plaintiff does
not want to move—as indeed he need not, since the initiative should come not
from him but from the trustees—a petition of the nature suggested above, filed
by the trustees in the intestate proceeding already commenced, will afford a
complete remedy for the attainment of the desired objective.

The courts are given discretionary power to refuse to, make a
declaration of rights “in any case where the declaration is not necessary and
proper at the time under all the circumstances.” (Section 6, Rule 66.) The
reason for this rule is thus stated in Corpus Juris Secundum. “A declaratory
judgment proceeding is intended to supplement, and not to be a substitute for,
or supersede, other existing remedies, in use at the time of the enactment of
the declaratory judgment acts; it may be used as an alternative or auxiliary to
other proceedings for an executory judgment; and it is within the discretion of
the court to permit such an action or proceeding to be maintained where another
remedy is available to plaintiff. As a general rule, however, to justify such an
action the situation must be such that adequate relief is not presently
available through the means of other existing forms of action or proceeding,
and, conversely, jurisdiction for a declaratory judgment ordinarily will not be
entertained where another equally adequate and appropriate remedy is already
available for the issues or rights sought to be determined and declared, as
where another equally serviceable statutory remedy has been specially provided
in cases of similar import, and particularly where such statutory remedy is
exclusive.” (1 C. J. S., 1027, 1028.)

It has been seen that there is at present a pending in testate
proceeding (case No. 71768) in which the plaintiff was appointed administrator.
And as has been pointed out also, a petition for the closing or termination of
that proceeding will at least be equally serviceable for the purpose for which
the present action was brought. Such petition has the additional advantage over
one for a mere declaration of the comparative rights of the plaintiff and the
defendant and intervenor, in that the relief in the first case would be
conclusive and executory and would dispose of the dispute once and for all,
aside from the fact that conflict of jurisdiction would be avoided, and the
issues would be placed before the forum qr branch of the court which by law
deals with testate, intestate, and trust matters under Part II, entitled
“Special Proceedings,” of the Rules of Court.

Moreover, the objection noted above regarding the non joinder
of necessary parties also obtains here, making improper if not useless any
declaration that might be made in the instant suit concerning the rights of the
trustees to the possession and administration of the trust properties. It is
undoubted that the intervention of at least Mr. Stevenot’s widow and of the
creditors in the proposed change in the methods of settling the estate and in
the men to carry out the settlement is not only expedient but essential for the
reason already emphasized. Mrs. Stevenot, as has been seen, initiated the
intestate proceed ing, and it was on her application that the administrator was
appointed. As to the creditors, these already have filed claims in that
proceeding aggregating P162,455.30. Under the circumstances, the heirs and the
creditors are of right entitled to be heard on a matter so vital to their
interest.

Incidentally, an ordinary motion or petition in the in testate
proceeding for the desired change will afford an opportunity to cure the defect;
the probate court handling the estate has the authority and the duty to require
the heirs and the creditors to appear, if they do not voluntarily do so, so that
they may contest the petition or motion if they so desire. And with all the
interested parties intervening, the case will be ripe for the adjudication in a
definite manner of the validity of the declaration of trust, if that be material
to the issues and if any of the parties should question such validity.

Upon the foregoing considerations, the action will be
dismissed, without costs. It is so ordered.

Moran, C.J., Ozaeta, Paras, Pablo, Bengzon, Padilla,
Montemayor, Reyes, and Torres, JJ., concur.