An “Extra-Judicial Settlement with Waiver of Rights and Deed of Indemnity” in the Philippines is a combined legal instrument often used when heirs settle and partition the estate of a deceased person without going to court, and at the same time:

Distribute the properties among themselves;
Allow one or some heirs to waive or transfer their hereditary rights in favor of others (or sometimes in favor of a buyer); and
Promise to indemnify and hold each other (or third parties) harmless from later claims related to the estate.

Below is a detailed, Philippine-specific guide to this document: what it is, the legal framework, when it can be used, how it is typically structured, and the common issues and risks.

Important: This is general information on Philippine law and practice, not a substitute for legal advice. For any real case, it is strongly advisable to consult a Philippine lawyer and a notary public.

1. Legal framework (Philippine context)

Several areas of Philippine law intersect in an Extra-Judicial Settlement with Waiver of Rights and Deed of Indemnity:

Civil Code on Succession
- Rights of heirs arise upon the death of the decedent.
- Heirs may accept or repudiate (waive) an inheritance.
- Once succession has opened (after death), heirs’ rights are transmissible and disposable (they can assign, sell, or waive them), subject to rules on legitime and compulsory heirs.
Rules of Court – Rule on Extra-Judicial Settlement
- A decedent’s estate may be settled extra-judicially (without court proceedings) if:
  - The decedent left no will;
  - No debts, or the debts have been fully paid;
  - All heirs are of legal age, or minors are properly represented; and
  - The settlement is contained in a public instrument (notarized), filed and published as required, and, for real property, registered.
Civil Code on Contracts, Waiver, Indemnity
- A waiver of rights is a kind of renunciation or release.
- A Deed of Indemnity is a contractual undertaking to answer for loss or damage (often similar in concept to a surety/guarantee, but tied to the estate context).
Property Registration Laws & Land Registration
- For real properties (land, buildings, condos), any transfer of title needs to be:
  - Supported by a proper notarized instrument, and
  - Registered with the Registry of Deeds to bind third persons and issue new titles.
Tax Laws (Estate, Donor’s, Capital Gains, Documentary Stamp Tax)
- Estate tax is due on the value of the decedent’s estate before distribution to the heirs.
- A waiver with consideration may be treated as a sale (CGT, DST, etc.).
- A waiver without consideration may be treated as a donation (possible donor’s tax implications).
- BIR often requires Estate Tax Return (ETR) and Electronic Certificate Authorizing Registration (eCAR) before the Register of Deeds processes title transfer.

2. What is an Extra-Judicial Settlement?

2.1 Concept

An Extra-Judicial Settlement (EJS) is a notarized agreement where the heirs:

Declare the death of the decedent;
Identify themselves as heirs (relationship to the decedent);
Identify the properties comprising the estate (real and/or personal);
Affirm no will was left and no outstanding debts (or that debts have been fully settled);
Agree on how to partition the estate amongst themselves; and
Undertake publication and registration as required.

This avoids a full-blown court proceeding for settlement of estate, which can be time-consuming and costly.

2.2 When is an EJS allowed?

EJS is generally permissible when:

There is no will.
- If there is a will, the proper proceeding is probate (judicial).
No outstanding debts or debts have been fully paid.
- Creditors are protected by law; if there are unpaid debts, judicial settlement is usually required, or debts must be settled first.
All heirs are of legal age, or minors are duly represented.
- Minors and legally incapacitated heirs must act through legal representatives (parents, guardians, etc.), and their interests must not be prejudiced.
Heirs consent to the partition.
- EJS is a contract among heirs; without unanimous consent (or proper representation), disputes may later arise.
Proper form and publication are complied with:
- The settlement must be in a public instrument (acknowledged before a notary public).
- A notice of the EJS is published in a newspaper of general circulation once a week for three consecutive weeks.
- For real property, the EJS is filed with the Registry of Deeds and accompanied by tax and BIR clearances.

2.3 Affidavit of Self-Adjudication vs. EJS

Affidavit of Self-Adjudication (ASA): Used when there is only one heir entitled to the estate. The lone heir adjudicates the property to himself/herself, still subject to publication and registration.
Extra-Judicial Settlement (EJS): Used when there are two or more heirs.

The document you’re asking about is the usual EJS, combined with:

Waiver of Rights, and
Deed of Indemnity.

3. Waiver of Rights in the context of succession

3.1 Nature of a waiver

A Waiver of Rights in succession is when an heir:

Renounces or relinquishes his or her share in the inheritance (or in specific properties), and
Allows another heir (or a third person) to acquire that share.

Forms of waiver:

Pure/Gratuitous Waiver (Renunciation without consideration)
- The heir simply relinquishes his/her share without payment.
- Often interpreted as donation in favor of other heirs, especially when it clearly benefits specific persons.
Waiver for Consideration (Sale/Assignment)
- The heir waives or assigns his/her hereditary rights in exchange for money or value.
- Often treated as a sale or assignment of hereditary rights, which may be subject to relevant taxes (capital gains, DST, etc.).
Partial Waiver
- The heir waives only a portion of his/her hereditary share (e.g., only with respect to a certain real property or a specific percentage).
Conditional Waiver
- The waiver is subject to conditions (e.g., waiver becomes effective upon full payment of a price, or upon fulfillment of certain obligations).

3.2 Legal limits on waiver

Cannot waive future legitime before the death of the parent (future inheritance). But once the decedent has died, succession has opened and the heir’s share is present property and can be waived or disposed of.
A waiver which prejudices compulsory heirs (e.g., excludes them unfairly or reduces their legitime) may be subject to reduction or challenge later.
Waivers made in fraud of creditors may be rescinded.

3.3 Effect of waiver

Once a waiver is validly executed and properly documented:

The waiving heir loses his/her right to the portion waived.
The beneficiary of the waiver (co-heir or third person) acquires that share, subject to:
- Taxes;
- Registration (for real properties); and
- Claims of omitted heirs, creditors, or other lawful claimants.

4. Deed of Indemnity: what it is and why it’s attached

A Deed of Indemnity is a contractual promise where a party:

Agrees to indemnify (reimburse or compensate) another party for losses, damages, claims, or liabilities arising from the estate or the settlement.

In an EJS context, common scenarios include:

Heirs indemnifying each other
- If later another heir appears (e.g., an illegitimate child, previously unknown heir) or a creditor claims against the estate, the heirs agree how the risk and financial burden will be shared.
- Sometimes, the heir who gets a larger share agrees to bear the risk and indemnify the others.
Heirs indemnifying a buyer or mortgagee
- If the property is being sold or mortgaged soon after the EJS, the buyer or lender may require the heirs to:
  - Guarantee peaceful possession;
  - Warrant that no other heirs or creditors will make valid claims; and
  - In case of eviction or adverse claims, refund the purchase price or pay damages.
Heirs indemnifying the lone adjudicating heir (if ASA was used)
- Sometimes, one heir initially self-adjudicates and later shares with others; indemnity agreements can regulate responsibilities among them.

Typical provisions include:

“We, the heirs, jointly and severally agree to indemnify and hold each other, as well as any transferees, free and harmless from any claims, liens, or encumbrances arising from undisclosed heirs or creditors…”

This gives comfort to parties relying on the settlement (other heirs, buyers, banks), but does not absolutely eliminate all legal risk; it mainly shifts responsibility between the contracting parties.

5. Structure of an Extra-Judicial Settlement with Waiver of Rights and Deed of Indemnity

While formats vary, a typical document in the Philippines contains:

5.1 Title

Example: “EXTRA-JUDICIAL SETTLEMENT OF ESTATE WITH WAIVER OF RIGHTS AND DEED OF INDEMNITY”

5.2 Parties/Appearances

Full names of all heirs;
Civil status (single/married/widowed), nationality;
Residential addresses;
Relationship to decedent (e.g., surviving spouse, legitimate child, illegitimate child, parent).

5.3 Recitals (Whereas clauses)

Typical recitals include:

Death of the decedent
- Name;
- Date and place of death;
- Residence at time of death.
Heirs
- Statement that the parties are the only surviving heirs, e.g.:
  - Legal spouse,
  - Legitimate/illegitimate children,
  - Parents or siblings (if no descendants).
No will
- Declaration that the decedent died intestate (without a will).
No debts (or debts fully paid)
- Declaration that no obligations remain unpaid, or that creditors have been fully settled.
Description of estate
- Listing of all properties:
  - Real properties: Title numbers (OCT/TCT/Condominium CCT), lot and block, survey numbers, location, area, boundaries, tax declarations.
  - Personal properties: Bank accounts, vehicles (plate number, CR/OR), shares of stock, receivables, etc.

5.4 Operative clauses

These are the “Now, therefore…” sections where the actual legal acts are done:

Extra-Judicial Settlement / Partition
- The heirs adjudicate and partition the estate among themselves.
- The document specifies who gets which property or percentage.
- The partition must respect legitime of compulsory heirs; otherwise, risk of later challenge.
Waiver of Rights
- Specific clauses where:
  - Certain heirs waive, renounce, quitclaim their hereditary rights to specified properties or shares; and
  - Identify the beneficiary of the waiver (co-heir or buyer).
- May indicate whether it is with or without consideration.
Deed of Indemnity / Warranties
- Heirs may:
  - Warrant that they are the only heirs;
  - Certify absence of debts; and
  - Agree to indemnify each other (and third parties, such as buyers) against future claims by unknown heirs or creditors.
- May specify if heirs are jointly and severally (solidarily) liable.
Publication commitment
- A clause stating that the heirs shall cause the publication of the settlement in a newspaper of general circulation once a week for three consecutive weeks, at their expense.
Tax and registration obligations
- Heirs may allocate who pays:
  - Estate tax;
  - Transfer tax;
  - Registration fees;
  - Capital gains or donor’s tax (where applicable).
Miscellaneous
- Severability clause;
- Governing law and venue (Philippines, specific city/municipality);
- Effectivity clause.

5.5 Signatures and Notarization

All heirs (or representatives for minors/incapacitated) sign the document.
Proper notarization:
- Notary verifies identities (via valid IDs), capacity, and voluntary execution.
- Instrument is annotated with Doc. No., Page No., Book No., Series of [Year].

6. Procedural steps in practice

A typical sequence in the Philippines, especially for real estate, looks like this:

Gather documents
- Death Certificate of decedent;
- Birth and marriage certificates to prove relationships;
- Titles (TCT/OCT/CCT), latest tax declarations;
- Tax clearances (real property tax);
- IDs of heirs.
Check debts and obligations
- Confirm if the decedent left debts (loans, unpaid bills, mortgages, taxes).
- Either settle debts first or consider judicial settlement if situation is complicated.
Draft the Extra-Judicial Settlement with Waiver and Indemnity
- Usually prepared with the assistance of a lawyer or a notary’s office.
- Reflect accurate estate inventory and intended distribution.
Execute and notarize
- Heirs appear before a notary public.
- Notary ensures all signatories understand and freely sign the instrument.
Publish the notice
- Publish a notice of the EJS in a newspaper of general circulation, once a week for three (3) consecutive weeks.
- Keep newspaper issues and publisher’s affidavit as proof for later registration and for evidence if ever needed in court.
File Estate Tax Return and pay estate tax
- Submit required documents to the BIR.
- Secure the eCAR (Electronic Certificate Authorizing Registration) indicating the transfer of properties from decedent to heirs.
Register with Registry of Deeds and Assessor’s Office
- For real properties:
  - Present the notarized EJS, proof of publication, eCAR, tax clearances, and other required documents to the Registry of Deeds.
  - Have new titles issued in the names of the heirs (or in the name of the heir/transferee benefiting from the waiver).
- Update tax declarations with the local Assessor’s Office.
Transfer of other properties
- Vehicles: Transfer at LTO upon presentation of EJS and BIR clearances.
- Bank accounts: Banks usually require EJS, eCAR, death certificate, IDs, and internal forms.
- Shares of stock: Transfer on corporate books using the EJS as base document.

7. Legal effects and risks

7.1 As to heirs who signed

They are bound by the settlement, waiver, and indemnity under contract law.
Once titles are transferred and waivers are effective, reversing the transaction can be difficult without everyone’s consent or a court action.

7.2 As to omitted heirs

If an heir was:

Unknown or not included, or
Not properly represented (e.g., a minor’s interests not properly safeguarded),

that omitted heir may:

Question the settlement;
Seek reconveyance of his/her proper share; or
Claim damages.

Courts often protect the rights of compulsory heirs, especially minors and illegitimate children.

7.3 As to creditors

If the estate has outstanding debts at the time of extra-judicial settlement, creditors may go after the properties in the hands of the heirs.
Rule on settlement often provides a period during which creditors may assert their claims.
Failure to comply with publication and other formalities may affect the protection afforded to third parties and facilitate creditor challenges.

7.4 As to buyers or mortgagees

Buyers who rely on an EJS with waiver and indemnity assume some risk of:
- Hidden heirs surfacing later, or
- Undisclosed debts and liens.

However:

Registered titles in their name and good-faith acquisition provide certain legal protections.
The Deed of Indemnity allows them to recover from the heirs if problems arise (subject to practical collectability).

8. Tax and financial considerations

While the exact rates and procedures evolve over time, conceptually:

Estate Tax
- Computed on the net estate of the decedent at the time of death.
- Must be paid and an eCAR obtained before register of deeds transfers titles.
Waiver without consideration
- May be treated as a donation by the waiving heir to other heirs.
- Possible donor’s tax implications depending on value and current tax rules.
Waiver for consideration (sale of hereditary rights)
- Treated as a sale or assignment of rights.
- May trigger:
  - Capital gains tax or income tax, depending on character of property;
  - Documentary stamp tax;
  - Transfer taxes.
Multiple transfers
- Sometimes, to minimize complexity:
  - The EJS directly puts the property in the name of the final intended owner beneficiary; or
  - A separate Deed of Absolute Sale is executed after titles are transferred to the heirs, depending on tax planning and legal advice.

Because tax rules are technical and changeable, tax consultation with the BIR or a tax professional is highly recommended.

9. Common drafting issues and practical tips

9.1 Ensuring all heirs are included

Carefully check the family tree:
- Spouse;
- Legitimate, illegitimate, and adopted children;
- Parents and siblings (if no descendants).
Get supporting civil registry documents (birth, marriage, death certificates).

9.2 Protecting minors and incapacitated heirs

Ensure minors are properly represented (parents/guardians).
Avoid settlements that are obviously unfair to minors, as they are vulnerable to later being set aside.

9.3 Full disclosure of properties

List all known estate properties:
- Land, buildings, condos;
- Vehicles;
- Bank accounts;
- Business interests;
- Receivables, etc.
Failure to include an asset may cause dispute later (e.g., discovery of “forgotten” land titles).

9.4 Clear description of waiver

Specify whether:
- The waiver is total or partial;
- It covers all inheritance or only specific properties;
- It is with or without consideration (and how much).
Ambiguous wording leads to conflict and tax uncertainty.

9.5 Thoughtful indemnity clauses

Identify clearly:
- Who indemnifies whom;
- For what risks (unknown heirs, creditors, taxes, title issues, etc.);
- Whether liability is joint or solidary.
Set out the extent of indemnity (full purchase price, damages, costs of litigation, etc.).

9.6 Compliance with formalities

Proper notarization (full names, IDs, acknowledgment).
Publication in correct format and frequency.
Timely filing of estate tax and transfer documents.
Registration with Registry of Deeds and updating tax declarations.

10. When judicial settlement may be more appropriate

An extra-judicial settlement—even with waiver and indemnity—may not be suitable when:

There are serious disputes among heirs (e.g., forged signatures, contested filiation or legitimacy, arguments about property ownership).
The decedent left substantial debts and many creditors.
There is a will (even if simple); the will must be probated.
Some heirs refuse to sign or cannot be located.
The estate is very complex or includes businesses and international assets.

In such cases, a judicial settlement of estate (through the courts) or probate of the will can provide a structured, court-supervised process that protects everyone’s rights.

11. Key takeaways

An Extra-Judicial Settlement with Waiver of Rights and Deed of Indemnity is a practical Philippine tool to settle an intestate estate without going to court, while:
- Partitioning the estate,
- Allowing heirs to waive or transfer their shares, and
- Allocating risk and responsibility through indemnity provisions.
It is valid only if legal conditions are met:
- No will, no outstanding debts (or debts fully paid),
- Heirs of legal age or properly represented,
- Proper notarization, publication, and registration.
Waiver of rights can be:
- Gratuitous (akin to donation) or
- For consideration (akin to sale), each with different tax implications.
A Deed of Indemnity does not remove all legal risks, but it:
- Assigns responsibility and financial liability among heirs and,
- Gives buyers or lenders contractual recourse against the heirs.
Formalities and documentation are crucial:
- Clear identification of heirs, properties, and shares,
- Proper drafting, notarization, publication, and registration,
- Compliance with estate tax and other tax requirements.
Because the consequences are long-term and sometimes irreversible, it is wise to:
- Seek assistance from a Philippine lawyer experienced in estates and real property,
- Coordinate with a notary public, and
- Consult with the BIR and local government offices for tax and registration details.

If you’d like, I can next help outline or draft a sample structure (section headings and clause examples) for this type of document in a Philippine setting, which you or your counsel can then adapt and finalize.