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Collation of donation and procedure to determine legitime

What is collation?

It is the process of adding the value of thing donated to the net value of hereditary estate. To collate is to bring back or return to the hereditary mass, in fact or fiction, property which came from the estate of the decedent, during his lifetime, but which the law considers as an advance from the inheritance. Collation is applicable to both donations to compulsory heirs and donations to strangers.

Is a parcel of land donated to one of the children by the parents part of their estate, and considered as an advance of their inheritance? Is there a need for the land donated to a child to be added again to the estate of the parents? What are the procedures to be observed in order to determine our accurate sharing in the estate of the parents?

The legitime of each heir in the estate can be determined after deducting all the debts and charges, and the donation made to an heir shall be added back, collated, or combined as it is considered an advance of their proportionate share. This is specifically in consonance with the following provisions of the New Civil Code of the Philippines:

"Article 908. To determine the legitime, the value of the property left at the death of the testator shall be considered, deducting all debts and charges, which shall not include those imposed in the will.

"To the net value of the hereditary estate, shall be added the value of all donations by the testator that are subject to collation, at the time he made them.

"Article 909. Donations given to children shall be charged to their legitime.

"Donations made to strangers shall be charged to that part of the estate of which the testator could have disposed by his last will.

"Insofar as they may be inofficious or may exceed the disposable portion, they shall be reduced according to the rules established by this Code."

Correlative thereto, Article 1061 of the same law also states that: "Every compulsory heir, who succeeds with other compulsory heirs, must bring into the mass of the estate any property or right which he may have received from the decedent, during the lifetime of the latter, by way of donation, or any other gratuitous title, in order that it may be computed in the determination of the legitime of each heir, and in the account of the partition."

This process is called collation. Essentially, the purpose of collation is to determine whether or not the donation made by the parents has prejudiced the legitime of the siblings. This finds support in the case of Natcher vs. Hon. Court of Appeals, et al., GR 133000, Oct. 2, 2001, where the Supreme Court, speaking through Associate Justice Arturo Buena, stated:

"Of equal importance is that before any conclusion about the legal share due to a compulsory heir may be reached, it is necessary that certain steps be taken first. The net estate of the decedent must be ascertained, by deducting all payable obligations and charges from the value of the property owned by the deceased at the time of his death; then, all donations subject to collation would be added to it. With the partible estate thus determined, the legitime of the compulsory heir or heirs can be established; and only thereafter can it be ascertained whether or not a donation had prejudiced the legitimes."

Applying the above-quoted decision, the donation made by the parents to the child is considered as advance legitime and is subject to collation. The respective legitimes of the siblings can only be established if the value of the property donated to the child will be added to the estate of the parents and after the deduction of the debts and charges.

Thereafter, the legitime of each heir can now be determined based on the partiable value of the estate. If the donation given to a child impaired the legitimes of the other siblings, then the child has to return the corresponding value needed to complete their legitimes, as such portion of the donation is considered inofficious.

Source: Manila Times

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