The facts  of this case may be summarized as follows: On January  15, 1939, Rio y Olabarrieta  (predecessor-ininterest of appellant Rio y Compania)  and the late Anastacio Manalo, father of the defendant-appellee  Elvira Maslog, entered  into  a "Contrato de  Servicios  Personates" wherein the  personal services of Anastacio Manalo were engaged by plaintiff-appellant for the administration and exploitation of its  forest concession.  Under the  contract, plaintiff-appellant was to extend to  agent  Manalo a credit not exceeding P5,000.00 with interest at  9%  per annum. On May  30,  1941, Anastacio  Manalo  died intestate at Puerto Princesa, Palawan.  Elvira Maslog carried on the account of her late father and made payments thereon up to December  31,  1941.   As of December 31, 1941, the balance of the account stood at P18,614.58 due and owing to  plaintiff-appellant.  On January 29,  1954,  plaintiff-appellant filed a complaint with the Court of First Instance of Palawan for the recovery of said amount from Elvira Maslog (joined with her husband) in her  capacity as her father's only heir,  because through  an affidavit of extrajudicial settlement of November 19, 1953 she had adjudicated to herself all the properties  of the late Anastacio Manalo.   Before the case was set for hearing, defendants-appellees filed a motion  to dismiss the complaint, on the ground that  the cause of action has already  prescribed. The trial  court rendered a decision,  holding that the complaint was filed late and consequently dismissed the same. Whereupon the creditor plaintiff appealed to  this Court.

We find it unnecessary to discuss in detail the various errors assigned by plaintiff-appellant for it is apparent that this action has become barred through the laches of appellant company.

It  is  admitted  that Anastacio Manalo  died intestate, and at the time  of his death at Puerto Princesa, Palawan, on  May  30,  1941, he  had an outstanding obligation in plaintiff-appellant's favor in  the total sum  of  P18,614.58. This  claim,  being for  money and  arising  from  contract, did  not  survive  and  should have  been  filed promptly against  the  estate of the deceased debtor  (Sees. 2  and 5, Rule  87).  Plaintiff-appellant  was  aware of the death of Anastacio Manalo on  said date, and it  is not claimed that Rio y Compania  (successor to the  original creditor) did not  know the existence  of  Manalo's obligation.   As a creditor, it was appellant's duty to  present its claim within a reasonable time after Anastacio Manalo's death in the estate  proceedings, and  if none were  had to file a petition for letters of  administration, as  authorized by sec.  6(b) of Rule  79.  But in  spite  of  the creditor's knowledge of the debtor's death on May  30, 1941  and its  awareness of  the  existence  of the  obligation, it did not take steps to  institute administration proceedings, or collect the debt  in question until January 29,  1954, more than  12  years from the death of the  decedent.

The law strictly requires the prompt presentation  and disposition of claims against the decedent's  estate in order to settle the affairs of the estate as soon as possible,  pay off  its debts and  distribute the  residue.  In the case of Tan Sen Guan  vs. Ga Siu San,  47 Phil.,  96,  this Court held:

"The purpose of the rule  is to settle the affairs  of  the estate with dispatch, so that the residue may be  delivered to the persons entitled  thereto without  their being afterwards  called upon  to respond in actions  for claims, which  under the ordinary statute of limitations, have not yet  prescribed.

"The purpose of the law in fixing a definite period  within which claims against an  estate  of  a deceased person must  be  presented is to  insure a speedy settlement of  the estate and the early distribution  and  delivery of the property to the persons who are legally entitled to  receive. The settlement  and distribution of the estate of  deceased persons  should not be unnecessarily delayed by the lethargy and negligence of those who have a direct interest in the same."  (In re Estate of Tangco 39 Phil.,  967-968.)

In consonance with this policy, it has been held that

"Where  a  creditor, knowing of a debtor's death and the fact that no administrator is  appointed allows three years  to elapse  without asking for the appointment of an administrator or institute intestate proceedings in the competent court he is guilty of laches  and his claim prescribes."  (Sikat vs. Villanueva, 57 Phil., 486; Chuakay & Co. vs. Oh Tiong Keng's Heirs, 62 Phil., 883; Magbanua vs.  Akol, 72 Phil., 567).

"To hold otherwise would he to permit  a creditor having knowledge  of his  debtor's death to keep the latter's estate  in  suspense indefinitely, by not instituting  either testate or intestate  proceedings  in  order to present his  claim,  to the prejudice of the  heirs and legatees."  (Sikat vs. Vda.  de Villanueva, supra.)

The  fact that the obligation arose  from a written contract,  with  a prescriptive  period of ten years is irrelevant to the policy  of speedy liquidation  of decedent's estates.   Chief  Justice  Moran,  has  noted that Sec.  5, Rule  87  of  the  Rules  of  Court,  constitutes  a  special limitation that overrides the ordinary rules of  prescription :

"Under this provision, not only claims due, but also  claims not due or contingent, should be filed otherwise they are barred forever. So that  even where a claim arises upon  a written  contract  and, therefore its  period  of limitation is ten years, if  the debtor  dies, such claim should be presented in the estate or intestate proceeding of  the deceased debtor within the time1  fixed by  the court, otherwise it is barred. * * *".  (Moran, Commentaries on the Rules of Court Vol. II,  1952  ed., p. 436.)

Nor does the moratorium constitute a good excuse for delaying  the filing  of this appellant's  claim,  and  the consequent  speedy settlement of the  debtor's estate  and delivery of  the  net residue "to the persons entitled thereto without their being afterwards called to respond in actions for claims  which, under  the  ordinary  statute of  limitations have not yet prescribed." (Moran, Commentaries on the Rules  of Court, Vol. II [3rd Ed] p. 400.)

We have heretofore  ruled that

"The general objective of  the moratorium law,  which is rehabilitation of debtors, must give way to the more  urgent  necessity of settling the estate of a decedent and distributing its residue among his  heirs as soon as  possible thereby minimizing if not avoiding altogether, expenses of administration."   (Jison  vs. Warner, Barnes & Co.  Ltd., 89 Phil., 239; 48 Off. Gaz. No. 9, p. 3873.)

It appearing that more than  12 years had elapsed from the death of Anastacio  Manalo before a  complaint  was filed  to recover the  indebtedness  of  the  deceased  and without the  filing of any  intestate  proceedings  in  the court, the plaintiff-appellant's action is  now  barred and was correctly dismissed by the  court below.

Wherefore, the order appealed from  is affirmed.  Costa against appellant.  So ordered.

Paras,  C. J., Bengzon, Padilla,  Montemayor, Bautista Angela, Labrador,  Concepcion  and Endencia,  JJ.,  concur.

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^[1] Bartolome vs. Ampil, G. R. No.  L-S436, August 28, 1956.

^[2] Rutter vs. Esteban, 93 Phil., 68;  49 Off. Gaz. p. 1807.