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John Dizon died intestate, leaving a parcel of land registered in his name alone. He left a widow and two legitimate children. Under Arts. 775 and 777 of the New Civil Code, which statement best describes the effect on the land title and how the heirs acquire their shares?

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The title to the land remains in the decedent's name and may only be transferred to the heirs through a deed of extrajudicial settlement or judicial settlement, after which the Register of Deeds issues new titles in the heirs' names in their shares. The state acquires the land if the decedent died intestate and there are no surviving heirs. The surviving spouse automatically becomes the sole owner of the land, and the children acquire nothing unless expressly provided by a will. The heirs cannot partition or deal with the property until after the estate is settled by the court, regardless of agreement among them.

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