In Philippine succession law, the death of a person immediately transmits their rights to their heirs. When several generations or family members pass away without their respective estates being settled, the legal situation becomes a "succession of estates" or a "multiple settlement." Settling these collectively is often more efficient and cost-effective than filing separate proceedings for each decedent, provided specific legal criteria are met.
1. Modes of Settlement
The process for settling multiple estates generally follows the two primary tracks under the Rules of Court:
- Extrajudicial Settlement (EJS): This is the most common route. It occurs when the decedents left no will and no debts (or all debts have been paid). All heirs must be of legal age (or properly represented) and must agree unanimously on how the properties will be partitioned.
- Judicial Settlement: If the heirs cannot agree, if there is a contested Last Will and Testament, or if there are complicated debts, the estate must be settled through a formal court proceeding.
2. The Concept of Consolidated Settlement
Under Philippine jurisprudence and administrative practice, the estates of a husband and wife, or parents and their children, may be settled in a single proceeding or document.
- Consolidated Extrajudicial Settlement: Heirs can execute a single "Deed of Extrajudicial Settlement of Estate" covering multiple decedents (e.g., "The Estates of Juan Dela Cruz and Maria Dela Cruz").
- Consolidated Judicial Petition: Rule 73, Section 2 of the Rules of Court allows for the settlement of the estates of both deceased spouses in a single proceeding.
3. Essential Requirements for Extrajudicial Settlement
To settle multiple estates outside of court, the following must be consolidated into the Deed:
- The Deed of Extrajudicial Settlement: A written instrument acknowledged before a Notary Public. It must describe the properties (titles, tax declarations) and the specific manner of partition among the heirs.
- Affidavit of Self-Adjudication: If there is only one surviving heir for all decedents.
- Publication: A notice of the settlement must be published in a newspaper of general circulation once a week for three consecutive weeks.
- Bond: If personal property is involved, a bond must be posted with the Register of Deeds.
4. Taxation: The "Estate Tax" Hurdle
The biggest challenge in multiple settlements is the payment of estate taxes. In the Philippines, the estate tax is an excise tax on the privilege of transmitting property at death.
| Rule | Description |
|---|---|
| Accrual | Tax accrues at the moment of death. Each death is a separate taxable event. |
| Multiple Filings | Even if the settlement is consolidated in one deed, the Bureau of Internal Revenue (BIR) requires separate Estate Tax Returns (BIR Form 1801) for each decedent. |
| Tax Rates | Under the TRAIN Law (effective Jan 1, 2018), the rate is a flat 6% of the net estate. For deaths prior to 2018, older graduated rates apply unless covered by an Estate Tax Amnesty (if currently active). |
5. Procedural Steps
- Inventory of Assets and Heirs: Identify all properties (real and personal) and the legitimate heirs of each deceased person.
- Procurement of Documents: Gather Death Certificates, Marriage Contracts, Birth Certificates of heirs, and Titles (TCTs/CCTs).
- Drafting the Deed: Ensure the "chain of succession" is clear. For example, if the grandfather died first, then the father, the deed must reflect the grandfather's estate passing to the father, and then the father's estate passing to the current heirs.
- Payment of Taxes: File the returns at the Revenue District Office (RDO) having jurisdiction over the last residence of the decedents.
- Obtaining the CAR: The BIR will issue a Certificate Authorizing Registration (CAR) for each decedent. This is the "golden ticket" required to transfer the titles.
- Transfer of Title: Submit the CAR, the Deed, and proof of publication to the Register of Deeds to issue new titles in the names of the heirs.
6. Common Complications
- Successional Rights of Predeceased Heirs: If an heir died before the decedent, their own children may inherit via the Right of Representation.
- Accretion: If an heir died after the decedent but before settlement, their share becomes part of their own estate, necessitating their own settlement process.
- Missing Heirs: All legal heirs must participate. If one cannot be found, a judicial process is usually required to protect the interests of the absentee.