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SALES Legal Redemption Under CC

SALES Legal Redemption Under CC

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Published by saintkarri
An assigned recitation
An assigned recitation

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Published by: saintkarri on Dec 31, 2009
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Legal Redemption
Under the Civil Code
Article 1619, Civil Code Legal redemption is the right to be subrogated upon the same terms and conditions
stipulated in the contract, in the place of one who acquires a thing:
by purchaseor
\u2013dation in paymentor
\u2013by any other transaction whereby ownership is transmitted by onerous title.
\ue000Only applies to transfer of ownership through onerous title, HENCE, not applicable to:
Transfers by gratuitous title
Hereditary succession
\ue000It can apply to sales with pacto de retro
\ue000It arises from the moment of the sale, and once exercised by the redemptioner, the subsequent rescission of
the sale cannot prejudice the redemptioner.
\ue000If redemption price is grossly excessive\ue000 it can be reduced by the court where the redemption is made by:
\u25cba co-owner - only pay a reasonable one (Art 1620)
adjoining land-owner of an urban land
minor or his guardian
1st Par, Article 1620, Civil Code A co-owner of a thing may exercise the right of redemption in case the shares ofa ll the
other co-owners ora ny of them, are sold to a third person. If the price of the alienation is grossly excessive, the
redemptioner shall pay only a reasonable one.
\ue000\u201cThird person\u201d or \u201cstranger\u201d \u2013 anyone who are not heirs of the vendor, by will or intestate succession. Anyone
who is not a co-owner.
\ue000Basis of the law:
\u25cbTo reduce the number of co-owners until the community is done away with on the grounds that co-
ownership is a hindrance to the development and administration of the property
\u25cbFor the benefit of the redemptioner to keep strangers out of a joint family ownership if the presence of
the outsider is undesirable
\u25cbTo afford a co-owner a way out of what might be a disagreeable and inconvenient association into
which he has been thrust
\ue000Right is not only available to original co-owners but to those who had later acquired the share of a co-
owner. But it cannot apply where the share of the co-owner was:
Merely mortgaged
Sold to another co-owner
2n d Par, Article 1620, Civil Code Should 2 or more co-owners desire to exercise the right of redemption, they may only
do so in proportion to the share they may respectively have in the thing owned in common.
\ue000c.f. with Art 1088 (two different situations give rise to same effct)
Article 1088, Civil Code Should any of the heirs sell his hereditary rights to a stranger before the partition, any
OR all of the co-heirs may be subrogated to the rights of the purchaser by reimbursing him for the price of
sale, PROVIDED they do so within the period of 1 month from the time they were notified in writing of the
sale by the vendor.
1st Par, Article 1621, Civil Code The owners of adjoining lands shall also have the right of redemption when a piece of
RURAL LAND, the area of which does not exceed 1 hectare, is alienated, UNLESS the grantee does not own any
rural land.
\ue000\u201cRural\u201d means pertaining to the country, as distinguished from a city or town. It is to be determined from the
character of the locality and vicinity (e.g. neighboring and surrounding properties) (Ortega v Orcine) E.g.
Buildings and improvements in the neighborhood are few and scattered, if they partake the character of the
country and are occupied by person s engaged in rural pursuits .
2n d Par, Article 1621, Civil Code The right is not applicable to adjacent lands which are separated by brooks, drains,
ravines, road and other apparent servitudes for the benefit of other estates.
\ue000Object of the law:
\u25cbTo prevent the rural land consisting 1 ha or less, from passing into the hands of a person other than
the adjacent owners who can make use of the alienated property for the improvement and
development of their own lands
\u25cbToco nso lida te scatted small agricultural land under one ownership
3rd Par, Article 1621, Civil Code If 2 or more adjoining owners desire to exercise the right of redemption at the same
time, the owner of the adjoining land of smaller area shall be preferred; and should both lands have the same area,
the one who first requested the redemption.
1st Par, Article 1622 , Civil Code Whenever a piece of urban land which is so small and so situated that a major portion
thereof cannot be used for any practical purpose within a reasonable time, having been bought merely for
speculation, is about to be re-sold, the owner of any adjoining land has a right of pre-emption at a reasonable
\ue000Reason for the law:
To discourage speculation in real-estate and aggravate the housing problem
\ue000\u201cRight of pre-emption\u201d is a right to acquire certain property in preference to any other person. It usually refers
to property newly coming into existence (Wikipedia).
2n d Par, Article 162 2, Civil Code If the re-sale has been perfected, the owner of the adjoining land shall have a right of
redemption, also at a reasonable price.
3rd Par, Article 1622 , Civil Code When two or more owners of adjoining lands wish to exercise the rights of pre-emption
or redemption, the owner whose intended use of the land in question appears best justified shall be preferred.
Debtor may extinguish the obligation by reimbursing the assignee of:
Price the assignee paid for the incorporeal right in litigation
Judicial costs incurred by him
Interest on the price from the day on which the same was paid
A credit or incorporeal right is \u201cin litigation\u201d from the time the complaint concerning the same is answered
Reason for the law:
To discourage speculation in lawsuits which would make courts an instrument for profit
EXCEPTIONS - Right is not available when:
a. Assignment of credit was made before any litigation
b.Assignments made to:

\ue001A co-heir or co-owner of the credit
\ue001Creditor in payment of his credit
\ue001Possessor of tenement or land which is subject to the assigned right

Reason for exceptions:
\u25cbBECAUSE assignee has a valid interest in the right or property assigned, and that the assignment was
not acquired for speculative purposes
1st Par, Article 1623 , Civil Code The right of legal pre-emption or redemption shall not be exercised except within3 0
days from the notice in writing by the prospective vendor or by the vendor, as the case may be. The deed of sale
shall not be recorded in the Registry of Property, UNLESS accompanied by ana ffida v it by the vendor that he has
given written notice thereof to all possible redemptioners.
\ue000Mere knowledge of the sale by the redemptioner acquired in any manner does not satisfy the requirement.
\ue000Purpose of the law:
To remove all uncertainty as to the sale, its terms and validity
To quiet any doubt that the alienation is not definitive
\u25cbMay be in the form of aletter or a copy of the motion filed in court on the redemptioner
Must be of the actual sale and not of a mere intention to sell
\ue000Reason for requirement of an affidavit:
To impress upon the affiant the necessity of making a true statement

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