Overview

When a person dies, ownership of their property transfers by operation of law at the moment of death to their heirs (Civil Code, Art. 777). Until the estate is fully settled and partitioned, all heirs hold the decedent’s property in a co-ownership—each owns an ideal (undivided) share, not any specific physical portion. This status drives nearly every rule on whether, and how, an heir (or the estate) can sell property before partition.

This article explains the legal framework, common scenarios, rights of heirs and buyers, tax and titling implications, and practical remedies in the Philippine context.

The Legal Frame in a Nutshell

Co-ownership rules apply (Civil Code, Arts. 484–501):
- Each co-owner may alienate only their undivided share (Art. 493).
- To sell the entire property, all co-owners must consent (or a representative with valid authority/court approval).
- Any co-owner may demand partition at any time (Art. 494), with limited exceptions (e.g., agreement not to partition for up to 10 years; testamentary prohibition up to 20 years; practical indivisibility).
Succession & hereditary rights:
- An heir may sell or assign his/her hereditary rights even before distribution (assignment of hereditary rights).
- Co-heirs have redemption rights if hereditary rights are assigned to a stranger (Civil Code Art. 1088).
Estate administration:
- If a judicial estate proceeding is open, the probate/intestate court controls estate property. Sales by an executor/administrator require prior court approval; sales without authority are generally ineffective against the estate.
Extrajudicial settlement (Rule 74, Rules of Court):
- Allowed if the decedent left no will, no debts, and all heirs are of age or duly represented.
- Heirs execute a Deed of Extrajudicial Settlement (EJS) or Affidavit of Self-Adjudication (sole heir), publish in a newspaper once a week for three consecutive weeks, and register with the Registry of Deeds (ROD).
- There is a two-year lien protecting excluded heirs and creditors; distributions remain subject to claims within that period.

What Can Be Sold Before Partition?

1) Sale by a Co-heir of His/Her Undivided Share

Valid as to the seller’s ideal share only.
The buyer steps into the shoes of the heir as a co-owner (pro-indiviso).
If the deed purports to convey a specific portion (e.g., “north half”), it is effective only as to the seller’s undivided share; the specific boundaries bind no one until partition.

Rights triggered:

Co-heirs’ legal redemption may apply:
- Art. 1088 (assignment of hereditary rights to a stranger): any co-heir may redeem within one month from written notice of the sale/assignment. No written notice, no running of the 1-month period.
- Art. 1620 (co-owners’ redemption): also relevant in some co-ownership sales of undivided shares to strangers.

2) Sale of the Entire Property by Fewer Than All Heirs

Invalid/ineffective beyond the seller’s undivided share.
As a rule, one heir cannot bind the shares of the others absent authority (special power of attorney) or court approval (if under estate administration).
Effect: Buyer becomes co-owner only up to the seller’s share. The rest remains with non-consenting heirs.

3) Sale by an Executor/Administrator While Probate/Intestate Case is Pending

Requires prior court approval (and usually compliance with sale procedures).
Without approval, the sale is void/ineffective as to the estate; it can be set aside upon motion or separate action.

4) Sale by a Surviving Spouse

If property was conjugal/community, the surviving spouse owns only his/her one-half; the decedent’s one-half goes to the estate.
The spouse cannot sell the entire property unless duly authorized by all heirs (and by the court if there’s an ongoing administration), or after proper liquidation of the property relations.

5) Sale Involving Minors or Incapacitated Heirs

Requires a guardian and court approval to sell or compromise the minor’s property interest.
Without these, the transaction is voidable and subject to annulment.

Practical Paths to a Clean Sale

A) Settle First, Then Sell

Extrajudicial Settlement (no will, no debts, all of age/represented):
- Execute EJS/Affidavit of Self-Adjudication, publish (3 consecutive weeks), pay taxes, and register with ROD.
- ROD cancels decedent’s title and issues new TCTs to heirs (or to a single heir through adjudication).
- Heirs then sell with clean chain of title.
Judicial Settlement (if there’s a will, debts, disputes, or minors):
- Petition for probate/intestate proceedings.
- Administrator/executor may sell with court approval (either by estate or after partition to heirs).

B) Direct Sale of Undivided Share or Hereditary Rights

Legally permissible, but buyer risks: title remains in the decedent’s name; buyer will need partition/settlement to obtain a separate TCT.
Co-heirs’ redemption may unwind the sale.
Typically priced lower due to clouds and procedural friction.

Taxes & Documentary Requirements (High-Level)

Always assess tax obligations early; non-compliance blocks title transfer.

Estate Tax: Estate tax return is generally due within one (1) year from death (extensions possible). Payment is a precondition for title transfers from the decedent.
Certificate Authorizing Registration (CAR):
- For transfers from decedent to heirs (settlement) and/or from heirs/estate to buyer. No ROD title work without CAR.
Real Property Taxes: Must be updated before transfer.
Capital Gains Tax / Creditable Withholding (for sale of real property classified as capital asset) and Documentary Stamp Tax: Typically due on sale by heirs or estate to a buyer.
Local Transfer Tax & Registration Fees: Payable upon registration with ROD.
For assignments among heirs (e.g., waivers/renunciations): May trigger donor’s tax if gratuitous; if for value, evaluate CGT and DST implications.

Tip: Decide early whether to (i) transfer to the heirs first then have them sell, or (ii) have the estate sell directly (through an authorized executor/administrator). The latter avoids multiple transfers but requires active court/administrative compliance.

Titling & Registration Realities

No partition yet: The TCT/ OCT remains in the decedent’s name; buyers cannot obtain their own title until the estate is settled (EJS or court order) and taxes are cleared.
Publication & Annotations: EJS/self-adjudication must be published and registered; ROD will annotate the instrument and any Rule 74, Sec. 4 lien.
Succeeding transfers: If heirs sell soon after EJS, submit both the EJS and the deed of sale to ROD with supporting CARs.

Common Disputes & How Courts Tend to Resolve Them

1) A Co-heir Sells the Whole Property Without Others’ Consent

As to non-selling heirs: sale is ineffective; they can seek annulment/cancellation vis-à-vis their shares and/or reconveyance.
As to seller’s share: sale stands. Buyer becomes co-owner pro-indiviso.
Practical endgame: Partition (judicial or by agreement). The court may award the portion where the buyer’s improvements lie to the buyer’s co-ownership share if equitable.

2) Buyer Wants Possession of a Specific Part Before Partition

Co-owners (including the buyer) may possess and use the whole thing in common, but must not exclude others or alter it to their prejudice.
Exclusive occupation can trigger a demand for accounting of fruits/rents and, if unresolved, an action for partition.

3) Excluded/Unknown Heir Emerges

Under Rule 74, they may sue within two (2) years from EJS registration/publication to assert share, or later under ordinary actions if fraud is alleged and within prescriptive periods.
Remedies: reconveyance, collation, partition, or damages against distributing heirs up to the value they received.

4) Ongoing Probate, Unauthorized Sale by Administrator/Heir

Move in the probate/intestate case to declare the sale void/ineffective, recover property or proceeds, and sanction the offending party.
Notice of lis pendens may be annotated to warn third parties.

5) Sale to a Stranger; Co-heirs Want to Keep It “In the Family”

Exercise legal redemption (Arts. 1088/1620) within the period and in the manner provided by law—usually by matching the price and complying with written-notice triggers.

Special Asset Situations

Family Home: Part of the estate but enjoys statutory protection from execution/claims subject to Family Code rules (e.g., beneficiaries, limits). Handle conservatively; avoid sale without universal consent and, if minors are involved, court leave.
Indivisible Property: If physically indivisible or division would render it unserviceable, court may award to one heir with cash equalization (owelty) to others.
Registered vs. Unregistered Land: Torrens system protects registered title; yet transfers from a decedent still require settlement and CARs. For unregistered land, proof of ownership and tax declarations will be scrutinized—expect heightened diligence.

Due Diligence Checklist (for Heirs and Buyers)

For Heirs

Confirm heirship (spouse, compulsory heirs, legitimacy, representation/substitution).
Determine property regime (absolute community, conjugal partnership, separation).
Check for wills, codicils, and debts/claims.
Decide on EJS vs. judicial settlement (minors? disputes? debts?).
Secure TIN of the estate, compute/settle estate tax, obtain CAR.
Publish EJS or self-adjudication; register with ROD.
If selling without partition, assess: consent of all heirs, risk of redemption, and buyer expectations.

For Buyers

Examine death certificate and chain of title; confirm that seller is heir/administrator.
If buying heir’s share, price in (i) co-ownership risk, (ii) redemption rights, (iii) need for partition.
If buying from the estate, demand court authority (order approving sale).
Require tax clearances and CAR(s); verify unpaid real property taxes.
Consider lis pendens, adverse claims, pending probate issues.

Typical Remedies & Actions

Action for Partition (Rule 69): to terminate co-ownership; may include accounting of fruits/rents and cash equalization.
Annulment/Rescission: to set aside sales made without authority/consent, or in fraud of co-heirs/creditors.
Reconveyance/Quieting of Title: to correct the register and restore legal ownership.
Redemption (Arts. 1088/1620): to recover shares sold to strangers, within strict periods.
Contempt/Sanctions in probate: for unauthorized dispositions during court administration.
Acción reivindicatoria / publiciana / interdictal: to vindicate ownership or possession, depending on circumstances and timelines.

Frequently Asked Questions

1) Can one heir sell the inherited house before partition? Yes, but only his/her undivided share. Selling the entire house requires all heirs’ consent (or court approval through an administrator/executor). The buyer of a lone heir’s share merely becomes a co-owner.

2) We found a deed where my sibling sold the whole lot to a buyer. Is it void? It is ineffective as to the shares of non-consenting heirs. It generally remains valid for what the seller could legally convey—his/her own undivided share.

3) How do we stop a buyer from fencing off a “portion” he bought from one heir? Demand cessation and, if needed, file partition (with injunction/damages if warranted). Until partition, no co-owner (or buyer of a share) may exclude others.

4) A stranger bought my cousin’s hereditary rights. Can we redeem? Yes. Co-heirs can redeem under Art. 1088 within one month of written notice of the assignment. Absent written notice, the period does not run.

5) Can the estate sell directly without first issuing titles to heirs? Yes, if there is a duly appointed executor/administrator and court approval of the sale. This can simplify the chain of transfers but requires strict compliance.

6) What if there are minors among the heirs? A guardian and court approval are necessary for dispositions affecting their shares; otherwise, the transaction is voidable.

7) Do we have to pay estate tax before selling? Practically yes. CAR(s) for estate transfer and the subsequent sale will be required for ROD registration. Estate taxes are typically settled before or alongside the sale process.

Practical Strategies

Get everyone to the table early. A clear EJS with publication and tax clearance avoids most downstream disputes.
If selling an undivided share, disclose the co-ownership and redemption risks in the deed; consider escrows or holdbacks.
During probate, never sell without court authority—it invites annulment and sanctions.
Protect minors’ interests with guardianship and court approval.
Use lis pendens to protect claims when litigation is unavoidable.
Document written notices that trigger redemption periods—timelines are strict.

Bottom Line

Selling inherited property without partition is legally possible but narrow in effect and riskier in practice. An heir may convey only what he/she owns—an undivided share—unless all heirs consent or a court authorizes an estate sale. To achieve a clean transfer (and a marketable title), prioritize proper settlement, tax compliance, and registrations. When disputes or complexities (minors, debts, wills, ongoing probate) exist, the safer path is judicial settlement and court-approved actions.

This overview is for general guidance and is not a substitute for tailored legal advice on specific facts and documents.