Heirs of Teves v. Court of Appeals
G.R. No. 109963 October 13, 1999
Spouses Marcelina Cimafranca and Joaquin Teves died intestate and without debts
in 1943 and 1953, respectively. During their lifetime, the spouses own two parcels of
land registered in the name of Marcelina and another lot registered in the name of
Joaquin and his two sisters. However, Joaquin’s sisters died without issue, causing the
entire property to pass to him. After Marcelina and Joaquin died, their children
executed extrajudicial settlements purporting to adjudicate unto themselves the
ownership over the two parcels of land and to alienate their shares thereto in favor of
their sister Asuncion Teves for a consideration. The division of the subject lot was
embodied in two deeds. The first Deed of Extrajudicial Settlement and Sale was entered
into on June 13, 1956 while the second deed was executed on April 21, 1959. The
Deed of Extrajudicial Settlement and sale was executed on December 14, 1971. After
the death of Asuncion Teves, her children, private respondents, extrajudicially settled
her property, adjudicating unto themselves said lots.
On May 9, 1984, herein petitioners, heirs of Marcelina and Joaquin, filed a
complaint with the Regional Trial Court of Negros Occidental against private
respondents for the partition and reconveyance of the aforesaid parcels of land, alleging
that the extrajudicial settlements were spurious.
ISSUE: Should the extrajudicial settlements be upheld?
Yes. An extrajudicial settlement is a contract and it is a well-entrenched doctrine
that the law does not relieve a party from the effects of a contract, entered into with all
the required formalities and with full awareness of what he was doing, simply because
the contract turned out to be a foolish or unwise investment. Therefore, although
plaintiffs-appellants may regret having alienated their hereditary shares in favor of their sister Asuncion, they must now be considered bound by their own contractual acts. The subject extrajudicial settlements were never registered. However, in the case
of Vda. de Reyes vs. CA, the Court, interpreting Section 1 of Rule 74 of the Rules of
Court, upheld the validity of an oral partition of the decedent’s estate and declared that
the non-registration of an extrajudicial settlement does not affect its intrinsic validity. It
was held in this case that the requirement that a partition be put in a public document and registered has for its purpose the protection of creditors and at the same time the protection of the heirs themselves against tardy claims. The object of registration is to serve as constructive notice to others. Thus, despite its non-registration, the extrajudicial settlements are legally effective and binding among the heirs of Marcelina Cimafranca since their mother had no creditors at the time of her death.
