TESTATE ESTATE OF NARCISO A. PADILLA, DECEASED. ISABEL B. VDA. DE PADILLA, EXECUTRIX AND APPELANT, VS. CONCEPCION PATERNO, ADMINISTRATIX AND APPELLEE.

This
appeal from an order of the probate court in the special proceeding for
the settlement of the testate estate of the deceased Narciso A. Padilla
involves the same properties that had already been the subject-matter
of two earlier appeals also brought to this Court by the
executrix-appellant Isabel B. Vda. de Padilla, G.R. No. 48137^[1] decided October 4, 1943, during the war, and G. R. No. L-4130,^[2] decided September 30, 1953, after the war.

The
facts of the case, up to the time the second appeal (G.R. No, L-4130)
was taken by the executrix to this Court, were summed up in our 1953
decision as follows:

“Narciso A. Padilla
died February 12, 1934, leaving a childless widow, Concepcion Paterno,
Whom he had married in 1912. His last will, which was probated in due
course, instituted his mother, Ysabel Bibby Vda. de Padilla, as
universal heiress.

In the proceedings for the settlement of
his estate in Manila (Civil Gases 46058-63), his widow moved for
delivery of her paraphernal property together with some reimbursements
and indemnities, and for one-half of the conjugal partnership property.
She also asked that her usufructuary right as surviving spouse be
imposed on the corresponding portion of her husband’s assets. The
heiress, who was executrix, opposed several such claims.

After
hearing evidence on both sides, the Court rendered on January 15, 1940,
a decision which, as amended by its resolution of April 24, 1940,
declared as paraphernal certain personal and real properties, Other
realties, although originally paraphernal, were considered part of the
conjugal assets because of buildings erected thereon during coverture,
but reimbursement of their value was directed. The main bulk was
adjudged conjugal property. The Court ordered the appointment of
commissioners to estimate the amounts to be reimbursed, to divide the
matrimonial assets into two equal parts for the spouses, and to
determine the specific portion of the deceased’s estate to be
encumbered with the widow’s usufruct (1/3). Other minor directives are
omitted for the sake of brevity.

The executrix appealed to
this Supreme Court, wherein, dated October 4, 1943, a decision was
promulgated upholding the judgment of the Manila court with a slight
modification as to payment of interest.

(That year Concepcion Paterno died. She is now represented by her testate heirs and legatees.)

For
compliance with the decision, the records went back to the Manila
court. Therein three commissioners were duly appointed: Vicente A.
Rufino, chosen by the widow’s side, Augusto J.D. Cortes by the
heiress-executrix, and V.R. Endaya by the Court.

After
hearing held before the said committee (May-November, 1947), Vicente A.
Rufino submitted his report dated July 9, 1948 which was concurred in toto
by V. R. Endaya. A few days later Augusto J. D. Cortes filed his own
report, wholly at variance with his colleague’s recommendations on many
important particulars.

In December, 1948, counsel for the
executrix interposed legal and factual objections to the Rufino report.
In May, 1949, Atty. Claro M. Recto, for the Paterno relatives, replied
to said objections, and prayed that they be overruled with the approval
of the aforesaid report.

On July 3, 1950, Judge Rafael
Amparo of the Manila Court approved the majority report except that he
declared: (1) lot No. 50 on Juan Luna Street was conjugal, and (2) the
usufruct of the widow shall be constituted on the one-third estate.”
(Report on Appeal, pp. 149-151)

After the
return of the records to the probate court for partition in accordance
with our decision in G. R. No. L-4130, which affirmed the decision
appealed from with the exception of the modification that one piece of
property ( the R. Hidalgo property) adjudicated to the widow was
assigned instead to the estate of the deceased, in exchange for another
property (in Azcarraga-Reina Regente) given to the widow, and after
delivery by the executrix on December 7, 1953 of the properties
constituting the widow’s share in the partition of the conjugal estate,
the executrix, on March 3, 1954, filed a petition for the final closure
of the testate proceedings. A day before the filing of this petition,
however, the trial court had issued an order, upon motion of the
administratrix of the estate of the widow Concepcion Paterno, for a
final accounting of the 1951, 1952, and 1953 credit balances of the
estate, and to determine the rentals or income of those properties
found to be paraphernal assets of the widow, so that the undelivered
portions of said rentals could be turned over to the widow’s estate.
Accordingly, the estate of the widow opposed the petition for closure
pending the final accounting required of the executrix in the court’s
order of March 2, 1954; and also pending determination of the share of
the widow in the additional value of the R. Hidalgo property, due to
the construction of the Illusion Theater, that in 1952 would become
property of the owners of the land. The administratrix of the widow’s
estate likewise sought an amendment of the court’s order of March 2,
1954, so as to require the executrix to account for the undelivered
rentals or fruits of the widow’s paraphernal properties from October 5,
1938, when the executrix started her administration, until December 7,
1953, when they were finally turned over to the widow’s estate.

On
March 15, 1954, the executrix submitted an accounting of the credit
balances of the estate for the years 1951, 1952, and 1953, but in
subsequent pleadings objected to the accounting of the fruits of the
properties declared to be paraphernal on the theory that (1) said
properties were actually held conjugal subject only to paraphernal
claims; and that (2) consequently, their income belonged to the
conjugal estate and had been periodically divided equally between the
executrix as the universal heir of the deceased and the widow’s estate.
As for the R. Hidalgo property, the executrix also objected to any
further determination of an additional share of the widow on the
improvements thereon, claiming that the widow’s estate was bound by the
value of P189,240 given to this property by the Rufino report from
which the administratrix of the Widow’s estate did not appeal.

Reply
and counter-reply having been filed by the parties on the above issues,
the probate court finally resolved the same in its order of July 31,
1954, the pertinent portions of which are as follows:

“The
questions that should be passed upon by this Court are those raised by
the administratrix of the estate of Concepcion Paterno in her motion
for reconsideration, to wit: (1) Should the herein executrix be made to
account for the income of the paraphernal properties belonging to
Concepcion Paterno as prayed for by said administratrix? (2) Is it
necessary to determine the additional value of the R. Hidalgo property
as sought by said administratrix?

The answer to the first
question is in the affirmative. The Civil Code of I889 provided that
upon dissolution of marriage the husband or his heirs may be compelled
to make immediate restitution of the paraphernal property which has
been turned over to the husband for administration (Art. 1391 in
connection with Art. 1369). The Code of Civil Procedure provided in its
Section 726 that where a deceased person in his lifetime held lands in
trust for another person, the court may, after notice given as required
in the preceding section, grant license to the executor or
administrator, and the person, his executor, or administrator, for
whose use and benefit they are holden; and the court may decree the
execution of such trust, whether created by deed or by law.’ Upon the
death of Narciso Padilla his marriage with Concepcion Paterno was
dissolved. From the moment of his death, his heir was bound to return
the paraphernal properties of Concepcion Paterno, and from said moment
any income or fruit derived from said paraphernal properties belonged
to the owner thereof.

It is contended by the executrix
herein that the properties under administration in this proceeding are
conjugal subject to the paraphernal claims of the widow, Concepcion
Paterno and that the rentals from one or the other property cannot be
excluded ‘for such exclusions cannot be justified, as the definite
character of the properties as adjudicated in favour of the wife or of
the husband became absolute and definite only after the decision of the
Hon. Supreme Court late in 1953.’ This contention is not well taken,
because the determination made by the Supreme Court of the character of
the properties in question retroacts to the date Narciso Padilla died.

It appears that Ysabel Bibby was appointed special administratrix in this proceeding on August 29, 1938.

The
other question refers to the R. Hidalgo property. With respect to this
property, the Supreme Court in its decision in G.R. No. L-4130 said—

‘This
Illusion Theatre was not reckoned with in the Rufino report Apparently
it would pass to the estate in 1952 upon the occurrence of specified
contingencies. If it has passed the matter could undoubtedly be the
subject of further deliberation upon appropriate motions. It would only
be a question of determining the additional value of the R. Hidalgo
property and of requiring the herein appellant to pay the Paterno
estate its corresponding share.’

The above quoted portion of the decision is clear arid needs no further elucidation.

Wherefore,
the executrix herein is directed to submit within ten (10) days from
receipt of this order an accounting of the income of the paraphernal
properties in question covering the period from August 29, 1938 to
December 7, 1953.

Regarding the R. Hidalgo property, this
proceeding is hereby set for hearing on August 1954, 8:30 a.m. for the
purpose of determining the additional value of said property in
consonance with the above indicated decision of the Supreme Court.

The
executrix herein is hereby authorized and directed to deliver
immediately to the estate of Concepcion Paterno the one-half portion of
the credit balance on the 1953 annual accounting.

The
consideration of the prayer to close this proceedings is hereby
deferred until the accounting herein above called for shall have been
submitted and passed upon and the additional value of the R. Hidalgo
property shall have been determined.

Let the
correction indicated by the administratix of the estate of Concepcion
Paterno be made. It is so ordered.” (Record on Appeal, pp. 60-62)

The
executrix sought but failed to have the above order reconsidered;
whereupon, she filed this her third appeal before this Court.^[1]

The executrix-appellant assigns six errors, which may be reduced to the following propositions:

(1)
That the lower court erred in holding that some of the properties
included in the estate are paraphernal in character and that all their
income belonged to the widow Concepcion Paterno;

(2) That the
widow having already raised the question of her right to all the fruits
of her alleged paraphernal properties in a petition for the liquidation
of their fruits filed before the probate court even before the war, and
no fruits having been awarded to her by the probate court in its
decision of January 15, 1940, as amended by its resolution of April 24,
1940, or by this Court in its 1943 decision in G.R. No. 48137 or in its
1953 decision in G.R. No. L-4130, (93 Phil., 884) the widow or her
estate is now barred from raising again the question of her exclusive
right to such fruits either by the principles of res judica or that of conclusiveness of judgment;

(3)
As to the R. Hidalgo property of the estate, the lower court erred in
sustaining the additional claim of the widow’s estate over the
improvements thereon.

In support of her first proposition,
that the lower court erred in holding that some of the properties in
the estate are paraphernal and that all their income belonged to the
widow Concepcion Paterno, the executrix-appellant claims “that our
decision in G.R. No. L-4130 did not declare any properties in the
estate of the deceased Narciso A. Padilla paraphernal, but that certain
properties therein were declared “conjugal assets, subject to
paraphernal claims”, and that this decision is the “law of the case” in
this incident and appeal.

The above argument appears to be a
mere reiteration of the claims already urged by this same appellant in
G.R. No. L-4130, wherein she similarly argued that the probate court,
and this Court in G. R. No. 48137, did not hold any properties in the
estate paraphernals but that certain properties therein were declared
conjugal partnership properties, with the widow being entitled to
reimbursement for the value of her paraphernal claims (see
Appellant’s Brief in G.R. No. L-4130, pp. 70-71, 103, 106). Rejecting
this argument in our decision in G.R. No. L-4130, we said:

“The
Rufino report which is printed in full on pages I69-I92 of the Record
on Appeal, states that the buildings constructed by the partnership on
the two lots were destroyed by fire during the battle of liberation of
Manila in 1945. Then it goes on to adjudicate:

‘As
already stated, the conjugal improvements on the lots on Arquiza and
Juan Luna have been destroyed by fire, and the Supreme Court having
held that the lands on which said improvements were erected remained
paraphernal until the value of said lands were paid to the widow
Concepcion Paterno Vda. de Padilla, said lands must be returned to the
Testate Estate of Concepcion Paterno Vda. de Padilla.

However,
any amount due or that may be received from the War Damage Commission
for the improvements that Were destroyed on those two pieces of
property shall be divided share and share alike between the estate of
Ysabel Bibby Vda. de Padilla and the estate of Concepcion Paterno Vda.
de Padilla.’ (Record on Appeal, p. 177).

The executrix
earnestly challenges the first paragraph contending that the lots
became conjugal properties from the time the buildings were erected
thereon, and the subsequent destruction of such buildings did not make
them paraphernal. She also argues that the indemnity to the widow for
said lots should be their value at the time of construction of the
buildingd, or at most, at the time of dissolution of the partnership in
1934.

These contentions may not be upheld in view of the
decision of the Manila Court and the confirmatory decision of this
Tribunal in 1943, There are, to be sure some propositions in said
decision which we may now hesitate to ratify, especially the
pronouncement that the lot continued to be paraphernal until its value
had been actually paid. But that judgment is now the law of the case.”
(Record on Appeal, pp. 151-152)

In other words, we maintained in G. R. No. L-4130, as the law of the case, our previous decision in G. R. No. 48137 that—

“The
ownership of the land is retained by the wife until she is paid the
value of the lot, as a result of the liquidation of the conjugal
partnership. The mere construction of a building from common funds does
not automatically convey the ownership of the wife’s land to the
conjugal partnership,” (Record on Appeal, p. 138)

Considering
that our decision in G. R. No. L-4130 is, in executrix-appellant’ s own
words, “the last and final decision of this Honorable Court intended to
definitely settle and close this estate” (Appellant’s Brief, p. 49),
and that the “law of the case” in this appeal are all the previous
decisions herein, “including the 1953 decision in G. R. No. L-4130” (idem,
p. 17), the dispositions made in our decision in G. R. No. L-4130
should be considered as final and conclusive on the parties in this
case and its incidents.

But to what extent does the “law of
the case”, as expressed in the above decisions, bear on the more
important question in this appeal—namely, the alleged exclusive right
of the widow Conception Paterno to all the fruits of the properties of
the estate declared paraphernal from the time conjugal partnership was
terminated by the death of the husband Narciso A. Padilla up to their
final delivery to the estate of the widow Concepcion Paterno on
December 7, 1953?

On this matter, we must perforce
distinguish those paraphernal properties that did not cease to be such
all throughout and were, accordingly, turned over to the widow’s estate
on December 7, 1953, from those that, having been paid or indemnified
in full to the widow upon the final partition and division of the
conjugal estate, had finally been converted into conjugal assets. To
determine the properties that belong to either class, we must go back
to the records of these settlement proceedings before this appeal and
the proceedings taken in the court below in. the course of the
execution of our final judgment in G. R. No. L-4130.

Let us
recall that in its original resolution of January 15,1940, the probate
court found the following properties to be paraphernal:

(1) the lot at 305 Arquiza Street and the demolished improvements therein;

(2) the lot at 1393-1409 Juan Luna Street and the improvements therein that had been torn down;

(3) the lot and improvements (except the building constructed during the marriage) at 401-407 Camba Street;

(4) the lot at 613-631 and 634-636 Martin Ocampo Street, with the original “accesorias” and a camarin which was destroyed in order that new “accesorias” might be constructed, these new “accesorias” being conjugal property;

(5) the property at 620-H, Callejon De la Fe;

(6) one-half of the property at 631 Regidor Street; and

(7) 9/29 of the property at 302-306 R. Hidalgo Street. (Record on Appeal, pp. 133-134).

The
findings of the probate court as to the nature of the above properties
were affirmed in toto by this Court in our decision in G.R. No. 48137
dated October 4, 1943.

After the above-mentioned decision
was returned to the lower court for execution, the battle for the
liberation of Manila supervened and as a result of the general
conflagration in the city sometime in February, 1945, the conjugal
buildings on the Arquiza and Juan Luna properties were completely
destroyed. As for the property at 631 Regidor Street, the same was
later expropriated by the government.

When the
commissioners appointed to execute the judgment submitted their report,
therefore, the majority of these commissioners (whose report, otherwise
known as the “Rufino Report” the lower court approved) made the
following recommendations:

(1) As to the
Arquiza and Juan Luna properties, the improvements of which were
destroyed during the battle for the liberation of Manila:

“As
already stated, the conjugal improvements on the lots on Arquiza and
Juan Luna have been destroyed by fire, and the Supreme Court having
held that the lands in which said improvements were erected remained
paraphernal until the value of said lands were paid to the widow
Concepcion Paterno Vda. de Padilla, said lands must be returned to the
Testate Estate of Concepcion Paterno Vda. de Padilla.” (Record on
Appeal in G. R. L-4130, p. 177)

(2) As to the Camba property:

“According
to the evidence presented, the portion of this lot located right at the
corner of San Nicolas and Camba Streets, otherwise known as Lot No.
6-A, and the building existing thereon, are both paraphernal
properties. They should, therefore, be delivered to the Testate Estate
of Concepcion Paterno Vda. de Padilla.

The portion of said
lot which is otherwise known as Lot No. 6-B likewise, originally
paraphernal, but a building was erected thereon by the conjugal
partnership, so that it would become conjugal partnership property upon
the reimbursement to the wife of its present value. According to the
evidence, Lot-No.6-B has an area of 83.422 sq. ms., and the present
value thereof per square meter is P30.00. This Testate Estate,
therefore, should reimburse the Testate Estate of Concepcion Paterno
Vda. de Padilla in the sum of P2,502.66. After said reimbursement, Lot
No, 6-B and the existing improvement thereon shall become conjugal
partnership property and should be divided accordingly for purposes of
distribution.11 (Record on Appeal in L-4130, pp. 179-80).

(3) As to the Martin Ocampo property;

“According
to the evidence the portion of the lot occupied by paraphernal building
or the accesoria otherwise known as Nos. 612, 614, 616, 620, 624, 626,
628 Quezon Boulevard, has a total area of 360.5 sq. m.; while the
interior portion of said lot actually occupied by the accesoria
constructed during the marriage of the spouses contained an area of
528.1 sq. ms. This interior portion is the one which must be appraised
by the Commissioners, and its value reimbursed to the Estate of
Concepcion Paterno Vda. de Padilla, in view of the ruling of the Court
that ‘el valor actual del suelo ocupado por dicha accesoria construida
durante el matrimonio se determinara por los Comislonados y se
adjudicara a la Viuda en concepto de indemnizacion.’ The outer portion
of 360.5 sq. ms. having been declared paraphernal property, should be
delivered to the Estate of Concepcion Paterno Vda. de Padilla.

The
evidence further shows that the reasonable value of said interior
portion is P125 sq. m., so that the total amount to be reimbursed is
P66,012.50. As soon as said reimbursement is made, said portion of the
lot and the buildings existing thereon as conjugal property should be
divided accordingly for purposes of distribution.” (Record on Appeal,
ibid, p. 181)

(4) As to the Callejon De la Fe property:

“In
view of the fact that finding of the Supreme Court was that this
property and the improvement which used to exist thereon were both
paraphernal, the lot should be delivered to the Testate Estate of
Concepcion Paterno Vda. de Padilla and whatever amount is paid by the
War Damage Commission as compensation for the destruction of said
building should also be totally paid to it.” (Record on Appeal, ibid,
p. 182)

(5) As to the Regidor property, which was expropriated by the government:

“The
compensation received for the expropriation of the Regidor property,
should be divided between the spouses in accordance with the finding of
the decision of the Supreme Court as to the character of said
property.” (Ibid, p. 192)

(6) And as to the R. Hidalgo property:

“The
R. Hidalgo property is partly conjugal and partly paraphernal.
Nine-twenty-ninths thereof belongs to the Testate Estate of Concepcion
Paterno Vda. de Padilla as paraphernal property, ten-twenty-ninths
thereof belongs to it as share in the conjugal partnership, while the
remaining ten-fwenty-ninths should belong to Doña. Isabel B. Vda. de
Padilla as her inheritance from the decedent herein. It has a total
area of 946.2 square meters. At the rate of P200 per square meter, it
has a total value of P189,240.00. The lot shall become conjugal
property and divided accordingly after the Testate Estate of Concepcion
Paterno Vda. de Padilla shall have been reimbursed in the sum of
P58,729.67.

Any payment made by the War Damage Commission
shall be divided in the same proportion, to wit: nineteen-twenty-ninths
shall belong to the Testate Estate of Concepcion Paterno Vda. de
Padilla, and the remaining ten-twenty-ninths shall belong to Doña.
Isabel B. Viuda de Padilla.” (Idem., pp. 182-183)

All
the above recommendations were approved by the trial court, and in her
appeal from the order of approval which is G. R. No. L-4130) , wherein
the executrix-appellant specially protested against the declaration
that upon the destruction of the improvements on the Arquiza and Juan
Luna properties, they remained paraphernal and must be returned to the
estate of the widow, as well as the recommendation to subdivide the
Camba and Martin Ocampo properties, declaring those portions thereof
occupied by paraphernal buildings as paraphernal and should be returned
to the widow’s estate, the same recommendations were affirmed by this
Court.

Considering, then, the “law of the case” in this
appeal as expressed in the Rufino report and approved by both the
probate court and this Court in G. R. No-L-4130, we find no error[in
the lower court’s pronouncement that as sole owner of those properties
that never became conjugal because the conjugal improvements thereon
were destroyed before they could be paid for to the widow (i.e., the
Arquiza and Juan Luna properties), as well as Lot No. 6-B on Camba
Street, the outer portion of the Martin Ocampo lot, and the Callejon de
la Fe property, that never ‘ceased to be paraphernal because there were
paraphernal buildings thereon at the time of the termination of the
conjugal partnership, the widow Concepcion Paterno is also the sole
owner of all their income that accrued during their administration by
the executrix-appellant until they were finally delivered to the estate
of the deceased Concepcion Paterno on December 7, 1953, minus, of
course, the administration expenses incurred by said
executrix-appellant with respect to these, paraphernal properties. This
is also in accordance with that portion of the Rufino report making the
following recommendation as to the rentals of said properties during
the period of settlement:

E. RENTALS AND OTHER INCOME DURING SETTLEMENT.

For
a complete liquidation of the estate under administration, the rentals
from real properties, and other income, such as proceeds from
expropriation, etc, should be disposed in the following manner:

The
rentals of property declared paraphernal, after deducting
administration expenses, must be delivered to the estate of Concepcion
Paterno; while the rentals from conjugal property, after deducting
administration expenses, should be divided equally between the heir of
the husband and those of the wife. * * * ” (Record on Appeal in L-4130,
p. 192)

Appellant claims that the above
recommendation is void because the commissioners appointed to execute
our 1943 decision in G. R. No. 48137 were vested only with the limited
authority of putting said decision into effect, and said decision made
no disposition as to rentals or fruits of the paraphemal properties.
This contention is unmeritorious because the above recommendation was
approved by the trial court in its order of July 3, 1950, and by this
Court in the 1953 decision in G. R. No. L-4130, and has become part of
the “law of the case”; as such it is now binding, conclusive, and
irrevocable in this appeal. Indeed, it nowhere appears in the brief
submitted by the executrix-appellant in G.R. No. L-4130 that she then
questioned the disposition, made by the Rufino report and by the lower
court, as to the rentals of the properties declared paraphemal during
the period of her administration, and it is now too late for her to
raise this objection many years after our decision in L-4130 had become
final and executory. With this result, it becomes unnecessary for us to
discuss the executrix-appellant’s proposition that the lower court’s
order of January 15, 1940, as amended by its resolution of April 24,
1940, and this Court’s decision in G. R. No. 48137, both of which came
ahead of our decision in G. R. No. L-4130, are res judicata by passing sub silentio this issue of the exclusive right of the widow to the fruits of her paraphernal properties.

The
above discussion does not, however, imply that the estate of the widow
Concepcion Paterno has also the exclusive right to the fruits of those
properties which, although originally paraphernal, had finally become
converted to conjugal assets after their values were reimbursed or paid
to the estate of the widow Concepcion Paterno in the final partition
and division of the estate left by the deceased Narciso A. Padilla.
These properties are the following:

(1) Lot No. 6-B of the Camba property;

(2) The interior portion of the Martin Ocampo property; and

(3) the 9/29 share of the widow in the R. Hidalgo property.

As
to the above properties, their conversion from paraphernal to conjugal
assets should be deemed to retroact to the time the conjugal buildings
were first constructed thereon or, at the very latest, to the time
immediately before the death of Narciso A. Padilla that ended the
conjugal partnership. They can not be considered to have become
conjugal property only as of the time their values were paid to the
estate of the widow Concepcion Paterno because by that time the
conjugal partnership no longer existed and it could not acquire the
ownership of said properties. The acquisition by the partnership of
these properties was, under the 1943 decision, subject to the
suspensive condition that their values Would be reimbursed to the widow
at the liquidation of the conjugal partnership; once paid, the effects
of the fulfillment of the condition should be deemed to retroact to the
date the obligation was constituted (Art. 1187, New Civil Code). As a
consequence, all the fruits of these properties, after the dissolution
of the partnership by the death of the husband, until final partition,
logically belonged to the universal heir of said husband (his mother
Isabel Bibby) and to the surviving widow in co-ownership, share and
share alike. As there has been periodical equal distribution between
these two parties of the current income of the estate, there is no need
for the executrix-appellant to make any new accounting for the fruits
of these properties.

Coming now to the third issue in this
appeal, namely, the right of the widow to an additional share in the
improvements on the R. Hidalgo property that was adjudicated to the
estate of the husband Narciso A, Padilla in the 1953 decision, G. R.
No. L-4130, we find no merit to the claim of appellant that—

“When
the R. Hidalgo property was appraised by the Rufino Report on July 9,
1948, at P189,240,00 and under such appraisement awarded to the estate
of the widow, we respectfully submit that the value as appraised
included not only the land but also the improvement which was then
already existing, the same having been built in 1947.”

because the Rufino report states in clear and unmistakable terms that only the land was appraised in the report and only its value included in the project of partition:

“The
R. Hidalgo property is partly conjugal and partly paraphernal.
Nine-twenty-ninths thereof belongs to the Testate Estate of Concepcion
Paterno Vda. de Padilla as paraphernal property, ten-twenty-ninths
thereof belongs to it as share in the conjugal partnership, while the
remaining ten-twenty-ninths should belong to Doña Isabel B. Vda. de
Padilla as her inheritance from the decedent herein. It has a total
area of 946.2 square meters. At the rate of P200 per square meter, it
has a total value of P189,240.00. The lot shall become conjugal
property and divided accordingly after the Testate Estate of Concepcion
Paterno Vda. de Padilla shall have been reimbursed in the sum of
P58,729.67.” (Record on Appeal in L-4130, pp. 182-183)

Indeed, the Rufino report could not have included the value of the
improvements at the time the commissioners appraised this property for
purposes of partition between the parties, because the old improvements
thereon were destroyed during the war and whatever improvements were
found therein by the commissioners in 1948 still belonged to the lessee
of said property. This was admitted in the executrix-appellant’s own
brief in G.R. No. L-4130 (pp. 119-120), to wit:

“The
increase in the valuation of the share of the widow in the R. Hidalgo
property from P45,608.26 to P58,729.59 is certainly unjustified,
considering, as above stated, that the permanent improvements on the R.
Hidalgo property were totally destroyed by fire during liberation.
Besides, if the property at present has increased in value, it is due
to the executrix-appellant who, after liberation, entered into a
contract of lease with Cinema Operators, Inc., which built the Illusion
Theatre and the commercial establishments nearby. The improvements
built by the lessee will become the property of the estate of Narciso
A. Padilla after the expiration of said contract of lease.”

Hence, the footnote in our decision in L-4130 to the following effect:

“This
Illusion Theater was not reckoned with in the Rufino report. Apparently
it would pass to the estate in 1952 upon the occurrence of certain
specified contingencies. If it has passed the matter could undoubtedly
be the subject of further deliberation upon appropriate motions. It
Would only be a question of determining the additional value of the R.
Hidalgo property and of requiring the herein appellant to pay the
Paterno estate its corresponding share.” (Record on Appeal, p.157)

As
correctly observed by the lower court in the order now appealed from,
“the above-quoted portion of the decision is clear and needs no further
elucidation” (Record on Appeal, p. 62).

Considering that the
improvements on the R. Hidalgo property accrued to the owner of the
land only after the, expiration of the seven-year lease entered into by
the executrix-appellant with the tenant on February 2, 1946, the lower
court did not err in ordering the appraisal of said improvement with
the view of determining the additional share therein of the widow
Concepcion Paterno.

Wherefore, with the clarification that
the accounting of the income of the paraphernal properties to be made
by the executrix-appellant should refer only to the Arquiza, Juan Luna,
and Callejon de la Fe properties, to Lot No. 6-A of the Camba property,
and to the outer portion of the Martin Ocampo property, the order
appealed from is affirmed. Without special pronouncement as to costs.

Bengzon, C.J., Bautista Angelo, Labrador, Barrera, Paredes, Dizon, and De Leon, JJ., concur.

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^[1] 74 Phil., 377.

^[2] 93 Phil., 884

^[1] Appellant Isabel Bibby
Vda. de Padilla died during the pendency of this appeal. For
convenieince of reference herein, however, she is still referred to in
this decision as the executrix-appellant.