VICTORIA BRINGAS PEREIRA, PETITIONER, VS. THE HONORABLE COURT OF APPEALS AND RITA PEREIRA NAGAC, RESPONDENTS.

Is a judicial administration proceeding necessary when the
decedent dies intestate without leaving any debts?  May the probate court appoint the surviving
sister of the deceased as the administratix of the estate of the deceased
instead of the surviving spouse?  These
are the main questions which need to be resolved in this case.

Andres de Guzman Pereira, an employee of the Philippine Air
Lines, passed away on January 3, 1983
at Bacoor, Cavite without a
will.  He was survived by his legitimate
spouse of ten months, the herein petitioner Victoria Bringas Pereira, and his
sister Rita Pereira Nagac, the herein private respondent.

On March 1, 1983, private respondent instituted before Branch 19
of the Regional Trial Court of Bacoor, Cavite, Special Proceeding No.
RTC-BSP-83-4 for the issuance of letters of administration in her favor
pertaining to the estate of the deceased Andres de Guzman Pereira.^[1]
In her verified petition,
private respondent alleged the following: 
that she and Victoria Bringas Pereira are the only surviving heirs of the deceased; that the deceased left no will; that
there are no creditors of the deceased; that the deceased left several
properties, namely:  death benefits from
the Philippine Air Lines (PAL), the PAL Employees Association (PALEA), the PAL
Employees Savings and Loan Association, Inc. (PESALA) and the Social Security
System (SSS), as well as savings deposits with the Philippine National Bank
(PNB) and the Philippine Commercial and Industrial Bank (PCIB), and a 300
square meter lot located at Barangay Pamplona, Las Piñas, Rizal and finally,
that the spouse of the deceased (herein petitioner) had been working in London
as an auxiliary nurse and as such one-half of her salary forms part of the
estate of the deceased.

On March 23, 1983,
petitioner filed her opposition and motion to dismiss the petition of private
respondent^[2]
alleging that there exists no estate of the deceased for purposes of
administration and praying in the alternative, that if an estate does exist,
the letters of administration relating to the said estate be issued in her favor as the surviving spouse.

In its resolution dated March 28, 1985, the Regional Trial Court,
appointed private respondent Rita Pereira Nagac administratrix of the intestate
estate of Andres de Guzman Pereira upon a bond posted by her in the amount of
P1,000.00.  The trial court ordered her
to take custody of all the real and personal properties of the deceased and to
file an inventory thereof within three months after receipt of the order.^[3]

Not satisfied with the resolution of the lower court, petitioner
brought the case to the Court of Appeals. 
The appellate court affirmed the
appointment of private respondent as administratrix in its decision
dated December 15, 1987.^[4]

Hence, this petition for review on certiorari where
petitioner raises the following issues: 
(1) Whether or not there exists
an estate of the deceased Andres de Guzman Pereira for purposes of
administration; (2) Whether or not a judicial administration proceeding is
necessary where there are no debts left by the decedent; and, (3) Who has the
better right to be appointed as administratrix of the estate of the deceased,
the surviving spouse Victoria Bringas Pereira or the surviving sister Rita
Pereira Nagac?

Anent the first issue, petitioner contends that there exists no
estate of the deceased for purposes of administration for the following
reasons:  firstly, the death benefits
from PAL, PALEA, PESALA and the SSS belong exclusively to her, being the sole
beneficiary and in support of this claim she
submitted letter-replies from these institutions showing that she is the
exclusive beneficiary of said death benefits; secondly, the savings deposits in
the name of her deceased husband with the PNB and the PCIB had been used to
defray the funeral expenses as supported by several receipts; and, finally, the
only real property of the deceased
has been extrajudicially settled between the petitioner and the private
respondent as the only surviving heirs of the deceased.

Private respondent, on the other hand, argues that it is not for
petitioner to decide what properties form part of the estate of the deceased
and to appropriate them for herself.  She
points out that this function is vested in the court in charge of the intestate
proceedings.

Petitioner asks this Court to declare that the properties
specified do not belong to the estate of the deceased on the basis of her bare
allegations as aforestated and a handful of documents.  Inasmuch as this Court is not a trier of facts, We cannot order an
unqualified and final exclusion
or non-exclusion of the property involved from the estate of the deceased.^[5]

The resolution of this issue is better left to the probate court before which the
administration proceedings are pending. 
The trial court is in the best position to receive
evidence on the discordant contentions of
the parties as to the assets of the decedent’s estate, the valuations
thereof and the rights of the transferees of some of the assets, if any.^[6]
The function of resolving whether or not a certain property should be included
in the inventory or list of properties to be administered by the administrator is one clearly within the
competence of the probate court. 
However, the court’s determination is only provisional in character, not
conclusive, and is subject to the final decision in a separate action which may
be instituted by the parties.^[7]

Assuming, however, that there exist assets of the deceased Andres de Guzman Pereira for purposes of
administration, We nonetheless find the administration proceedings instituted
by private respondent to be unnecessary as contended by petitioner for the
reasons herein below discussed.

The general rule is that when a person dies leaving property, the
same should be judicially administered and the competent court should appoint a
qualified administrator, in the order established in Section 6, Rule 78, in
case the deceased left no will, or in case he had left one, should he fail to
name an executor therein.^[8]
An exception to this rule is established in Section 1 of Rule 74.^[9]
Under this exception, when all the heirs are of lawful age and there are no
debts due from the estate, they may agree in writing to partition the property
without instituting the judicial administration or applying for the appointment
of an administrator.

Section 1, Rule 74
of the Revised Rules of Court, however, does not preclude the heirs from
instituting administration proceedings, even if the estate has no debts or
obligations, if they do not desire to resort for good reasons to an ordinary
action for partition.  While Section 1
allows the heirs to divide the estate among themselves as they may see fit, or
to resort to an ordinary action for partition, the said provision does not
compel them to do so if they have good reasons to take a different course of
action.^[10]
It should be noted that recourse an administration proceeding even if the
estate has no debts is sanctioned only if the heirs have good reasons for not
resorting to an action for partition. 
Where partition is possible, either in or out of court, the estate should
not be burdened with an administration proceeding without good and compelling
reasons.^[11]

Thus, it has been repeatedly held that when a person dies without
leaving pending obligations to be paid, his heirs, whether of age or not, are
not bound to submit the property to a judicial administration, which is always
long and costly, or to apply for the appointment of an administrator by the
Court.  It has been uniformly held that
in such case the judicial administration and the appointment of an
administrator are superfluous and unnecessary proceedings.”^[12]

Now, what constitutes “good reason” to warrant a
judicial administration of the estate of a deceased when the heirs are all of
legal age and there are no creditors will depend on the circumstances of each
case.

In one case,^[13]
We said:

“Again the petitioner argues that ‘only when the heirs do not
have any dispute as to the bulk of the hereditary estate but only in the manner
of partition does section 1, Rule 74 of the Rules of Court apply and that in
this case the parties are at loggerheads as to the corpus of the hereditary
estate because respondents succeeded in sequestering some assets of the
intestate.  The argument is unconvincing,
because, as the respondent judge has indicated, questions as to what property belonged
to the deceased (and therefore to the heirs) may properly be ventilated in the
partition proceedings, especially where such property is in the hands of one heir.”

In another case, We held that if the reason for seeking an
appointment as administrator is merely to avoid a multiplicity of suits since
the heir seeking such appointment wants to ask for the annulment of certain
transfers of property, that same objective could be achieved in an action for
partition and the trial court is not justified in issuing letters of
administration.^[14]
In still another case, We did not find so powerful a reason the argument that
the appointment of the husband, a usufructuary forced heir of his deceased
wife, as judicial administrator is necessary in order for him to have legal
capacity to appear in the intestate proceedings
of his wife’s deceased mother, since he may just adduce proof of his being a
forced heir in the intestate proceedings of the latter.^[15]

We see no reason not to apply this doctrine to the case at
bar.  There are only two surviving heirs,
a wife of ten months and a sister, both of age. 
The parties admit that there are no debts of the deceased to be paid.  What is at once apparent is that
these two heirs are not in good terms. 
The only conceivable reason why private respondent seeks appointment as
administratrix is for her to obtain possession of the alleged properties of the
deceased for her own purposes, since these properties are presently in the
hands of petitioner who supposedly disposed of them fraudulently.  We are of the opinion that this is not a
compelling reason which will necessitate a judicial administration of the
estate of the deceased.  To subject the
estate of Andres de Guzman
Pereira, which does not appear to be substantial especially since the only real
property left has been extrajudicially settled,
to an administration proceeding
for no useful purpose would only unnecessarily
expose it to the risk of being wasted or squandered.  In most instances of a similar nature,^[16]
the claims of both parties as to the properties left by the deceased may be
properly ventilated in simple partition proceedings where the creditors, should
there be any, are protected in any event.

We, therefore, hold that the court below before which the administration
proceedings are pending was not justified in issuing letters of administration,
there being no good reason for burdening the estate of the deceased Andres de
Guzman Pereira with the costs and expenses of an administration proceeding.

With the foregoing ruling, it is unnecessary for us to delve into
the issue of who, as between the surviving spouse Victoria Bringas Pereira and
the sister Rita Pereira Nagac, should be preferred to be appointed as
administratrix.

WHEREFORE, the letters of administration issued by the
Regional Trial Court of Bacoor to Rita Pereira Nagac are hereby revoked and the administration proceeding dismissed
without prejudice to the right of private respondent to commence a new action
for partition of the property left by Andres de Guzman Pereira.  No costs.

SO ORDERED.

Narvasa, (Chairman), Cruz, Griño-Aquino, and Medialdea, JJ., concur.

^[1]
Page 27, Rollo.

^[2]
Page 29, Supra.

^[3]
Page 3, Rollo.

^[4]
Page 33, Supra.

^[5]
Ortega v. Court of Appeals (1987).

^[6]
Sebial v. Sebial, 64 SCRA 385 (1975).

^[7]
Ortega v. Court of Appeals, Supra; Valera v.
Inserto, 149 SCRA 553 (1987); Vda. de Rodriguez v. Court of Appeals, 91
SCRA 540 (1979); Cuizon v. Remolete, 129 SCRA 495 (1984); Lachenal v. Salas, 71 SCRA 262 (1976);
Coca v. Borromeo, 81 SCRA 278 (1978); Garcia v. Garcia, 67 Phil.
353 (1939); Guinguin v. Abuton, 48 Phil 144 (1925).

^[8]
Utulo v Pasion vda. de Garcia, 66 Phil. 303 (1938).

^[9]
“Section 1.  Extrajudicial
settlement by agreement between heirs. 
– If the decedent left no will and no debts and the heirs are all of
age, or the minors are represented by their judicial or legal representatives
duly authorized for the purpose, the parties may, without securing letters of
administration, divide the estate among themselves as they see fit by means of
a public instrument filed in the office of the register of deeds, and should
they disagree, they may do so in an ordinary action of partition.  x x x”

^[10]
Rodriguez, et al. v. Tan, etc. and Rodriguez, 92 Phil. 273 (1952).

^[11]
Intestate Estate of Mercado v. Magtibay, 96 Phil. 383 (1953) citing
Monserrat v. lbañez, G.R. No. L-3369, May 24, 1950.

^[12]
Utulo v. Pasion de Garcia, Supra; Fule v. Fule, 46
Phil. 317(1924); Baldemor v. Malangyaon, 34 Phil. 367(1916); Bondad v. Bondad, 34
Phil. 232(1916); Malafasan v. Ignacio; 19 Phil. 434(1911); Ilustre v. Alaras Frondora; 17 Phil.
321(1910).  In Orozco vs. Garcia,
50 Phil 149, it was held that there is nothing in Section 1, Rule 74 which
prohibits the heirs from instituting special proceeding for the administration
of the intestate estate, if they cannot agree in the extrajudicial partition
and apportionment
of the same.  Utulo v.
Pasion Vda. de Garcia, Supra
reaffirmed the doctrine laid down in the cases previous to Orozco.

^[13]
Monserrat v. lbañez, Supra cited Intestate Estate of Mercado v.
Magtibay, Supra.

^[14]
Intestate Estate of Mercado v. Magtibay, supra.

^[15]
Utulo v. Pasion vda. de Garcia, supra.

^[16]
Intestate Estate of Mercado v. Magtibay, Supra.