REMALAW – Atty.

Rex Enrico Cruz

99 Homes (Movie) – Reaction Paper

Fundamentals of Land Ownership

Regalian Doctrine – all lands of whatever classification and other natural resources not otherwise
appearing to be clearly within private ownership belongs to the State.

 Exception: Ancestral Land

Classifications of Property

o According to Mobility
 Immovable by NATURE, or those which cannot be moved from place to place
 Immovable by INCORPORATION, or those which are attached to an immovable
in such a manner as to form an integral part thereof.
 Immovable by DESTINATION, or those which are place in an immovable for the
use, exploitation or perfection of such immovable.
 Immovable by ANALOGY, or those which are considered immovable by
operation of law.
 Movable
o According to Ownership
 Public Dominion
1. Public Use: roads, canals, rivers, torrents, ports, and bridges
2. Public Service: Government offices, military camps, weaponry
3. Development of the National Wealth

Property of public dominion also covers property of public use in the

provinces, cities, and municipalities.

 Private Ownership
1. All belonging to private persons
2. Patrimonial property
o Property of the State which are not intended for public use or
public service; they are held by the State for private or business
capacity
o Property of public dominion, when no longer intended for
public use for public service, shall also form part of the
patrimonial property
o Examples: execution sales, escheat

Classification of Public Lands

o Agricultural
o Forest or Timber
o Mineral
o National Parks
 ALL LANDS OF THE PUBLIC DOMAIN ARE OWNED BY THE STATE. WITH THE EXCEPTION OF
AGRICULTURAL LANDS, ALL OTHER NATURAL RESOURCES SHALL NOT BE ALIENATED.

 Different Kinds of Agricultural Lands

o Agricultural
o Commercial, Industrial, or for similar productive purposes
o Educational, charitable, and other similar purposes
o Reservation for town sites, and for public and quasi-public use.

 Alienable and Disposable

o In classifying lands of the public domain as alienable and disposable, there must be a
positive act from the government declaring them as open for alienation and disposition.
o A positive act is an act which clearly and positively manifests the intention to declassify
lands of the public domain into alienable and disposable
 Conversion and Reclassification
o Conversion is an act of changing the current use of a piece of agricultural land into some
other use as approved by the Department of Agrarian Reform (DAR).
o Reclassification is the act of specifying how agricultural land shall be utilized for non-
agricultural uses such as residential, industrial, and commercial, as embodied in the land
use plan, subject to the requirements and procedures for land use conversion
 A mere reclassification of an agricultural land does not automatically allow a
landowner to change its use. He has to undergo conversion.
 Foreshore Land and Submerged Land
o Foreshore land is the land which lies between the high and low water marks, and that is
alternatively wet and dry according to the flow of the tide. It is part of the land which is
between high and low water and left dry by the flux and reflux of the tides.

o The ownership of lands reclaimed from foreshore and submerged areas is rooted in the
Regalian Doctrine which holds that the State owns all lands and waters of the public
domain.
LAND OWNERSHIP
 Ownership may be defined as the INDEPENDENT RIGHT of EXCLUSIVE ENJOYMENT and
CONTROL of a thing for the purpose of deriving therefrom ALL ADVANTAGES required by the
REASONABLE NEEDS of the owner and the PROMOTION of the general welfare but subject to
the RESTRICTIONS imposed by law and the rights of others.
 Kinds of Land Ownership
A. Extent
a. Full Ownership – includes all the rights of an owner
b. Naked Ownership – the right to the use and the fruits have been taken by
another (such as in the case of usufruct).
B. Number
a. Sole Ownership – vested in one person
b. Co-Ownership – vested in two or more person
 Bundle of Rights
o Right to Use (Jus Utendi)
o Right to Possess (Jus Possidendi)
o Right to the Fruits (Jus Fruendi)
o Right to Abuse/Consume (Jus Abutendi)
o Right to Dispose (Jus Disponendi)
o Right to Vindicate/Recover (Jus Vindicandi)
 Limitation to Rights of Land Ownership
o Inherent Power of the State
 Police Power
 Power of Taxation
 Power of Eminent Domain
o Imposed by Law
  Legal Easement
 Rent Control Law
 Zoning Regulations
 PD 957
 Escheat
o Imposed by Agreement
 Contract of Lease
o Imposed by the Grantor
 Deed of Donation
 Master Deed/Deed Restrictions
 Modes of Acquiring Land Ownership
o Public Grant – By administrative process, the government transfers land to a private
individual by the issuance of a sales patent or special patent (CA No. 141).

CA No. 141, also known as the Public Land Act, remains to this day the existing general
law governing the classification and disposition of lands of the public domain.

o Private Grant or Voluntary Transfer – The transfer is given by the voluntary execution of
a deed of conveyance in certain prescribed form, completed by the recording or
registration thereof because registration is the operative act that binds and affects third
persons.

Nonetheless the contract is binding between the parties, their heirs, assignees and
successors in interest (New Civil Code).

Example of Private Grant: Sale and Donation

o Involuntary Grant or Involuntary Alienation- This does not require the consent or
cooperation of the owner of the land and is usually carried out against his will. Usual
forms of involuntary alienation are expropriation or condemnation proceedings. Other
examples are escheat, revision, seizure based on tax delinquency, levy on attachment
and levy on execution (Noblejas).

o Inheritance – (1) By descent – acquired by virtue of hereditary succession to the estate

of a deceased owner; and

(2) By devise – succession need not be in favor of a relative.

o Reclamation – It is the method of filling submerged land by deliberate acts and

reclaiming title thereto (Noblejas).

o Accretion – To the owner of lands adjoining the banks of rivers belong to the accretion
which they gradually receive from the effects of the currents of the waters.
 The alluvial property obtained due to the accretion is not automatically covered by the
Torrens title. Ownership of a piece of land is one thing, and registration under the
Torrens System is quite another. To be covered by the Torrens title, the alluvial property
must be placed under the operation of the registration laws (Grande vs. CA).

Accretion must be natural.

o Acquisitive Prescription – Must be in the concept of an owner. A person acquires land

title by acquisitive prescription if he has been in open, continuous, exclusive, and
notorious possession for a period prescribed by law.

Under the Civil Code:

- Ordinary Prescription – possession in good faith and with just title for ten (10)
years.
- Extraordinary Prescription – adverse possession without need of title or of good
faith for thirty (30) years.

Just title means “with color of title and good faith”.

RA No. 11573 amended Section 44 of Commonwealth Act No. 141

“SEC. 44. Any natural-born citizen of the Philippines, who is not the owner of more than
twelve (12) hectares of land, and who, for at least twenty (20) years prior to the filing of
an application for agricultural free patent, has continuously occupied and cultivated,
either personally or through a predecessor-in-interest, a tract or tracts of alienable and
disposable agricultural public lands subject to disposition, and who shall have paid the
real estate tax thereon shall be entitled, under the provisions of the Chapter, to have a
free patent issued for such tract or tracts of such land not to exceed twelve (12)
hectares.”

RA No. 11573 amended Section 14 of PD No. 1529

“SEC. 14. Who may apply. The following persons may file at any time, in the proper
Regional Trial Court in the province where the land is located, an application for
registration of title to land, not exceeding twelve (12) hectares, whether personally or
through their duly authorized representatives.

“(1) Those who by themselves or through their predecessors-in-interest have been in

open, continuous, exclusive and notorious possession and occupation of alienable and
disposable lands of the public domain not covered by existing certificates of title or
patents under a bona fide claim of ownership for at least twenty (20) years immediately
preceding the filing of the application for confirmation of title except when prevented
by war of force majeure. They shall be conclusively presumed to have performed all the
 conditions essential to a government grant and shall be entitled to a certificate of title
under this section.”

Res Nullius

“Everything on Earth must have an Owner”

Res Nullius is a Latin term that means things (res) without an owner (nullius). Since everything must
have an owner, if there are no private owners or claimants, then that particular property is presumed to
be owned by the State. Likewise, when a person dies without any heir, then the State succeeds to the
estate of the deceased.

Stewardship Concept – Ownership of land carries with it a distinct social obligation. Owners are obliged
to use their properties to promote the general welfare and not only their interest, thus the State may
regulate and control land ownership.

Extent of Land Ownership

 Surface
 Everything under it
o Without detriment to servitude
o Subject to special laws and ordinances
o Aerial navigation

Doctrine of Self-Help – The owner or lawful possessor of a thing has the right to exclude any person
from the enjoyment and disposal thereof.

For this purpose, he may use such force as may be reasonably necessary to repel or prevent an actual or
threatened unlawful physical invasion or usurpation of his property.

Hidden Treasure – Hidden treasure belongs to the owner of the land, building, or other property on
which it is found.

When the discovery, if made on the property of another, or of the State or any of its subdivisions, and by
chance, ONE-HALF thereof shall be allowed to the finder. If the finder is a trespasser, he shall not be
entitled to any share of the treasure.

If the thing found be of interest to science or arts, the State may acquire them at their just price, which
shall be divided in conformity with the rule stated.

Note: by treasures, it means any hidden any unknown deposit of money, jewelry, or other precious
objects the lawful ownership of which does not appear.

*Hidden treasures must have an ownership which is unknown. For example, gold bars and oil (a natural
resource) belong to the State and are not considered hidden treasures.

Accession – The right pertaining to the owner of a thing over which is produced thereby, or which is
incorporated or attached thereto, either naturally or artificially.

Accession is the extension of ownership over a thing to everything which is produced by it or

incorporated or attached to it.
  Industrial – Generally, whatever is built, planted or sown on the land of another and the
improvement or repair made thereon, belong to the owner of the land, subject to certain
specific rules.

All works, sowing and planting are presumed made by the owner and at his expense, unless the
contrary is proved.
 Natural – Alluvion – the accretion or increase in the size of the land due to the GRADUAL
DEPOSIT caused by the current of water.

To the owner of the land adjoining the banks of rivers belong the accretion which they gradually
receive from the effects of the current of the waters

Avulsion – the increase in the size of a land due to the transfer thereto of a portion segregated
from another estate by water current.

Change of River Beds

 Abandoned River Beds – river beds which are abandoned through the natural change in the
course of the water ipso facto belongs to the owner whose lands are occupied by the new
course, in proportion to the area lost.

However, the owner of the lands adjoining the old bed shall have the right to acquire the same
by paying the value thereof, which value shall not exceed the value of the area occupied by the
new bed.
 New River Bed – Whenever a river changing its course by natural causes, opens a new bed
through a private estate, this bed shall become of public dominion.

The owners of the affected land may not compel the government to restore the river to its
former bed; nor can they restrain the government from doing so should the latter choose to.

The owners of the affected land are not entitled to compensation for any damage sustained.
However, they shall own the abandoned river bed in proportion to the area they lost.

The owner of the affected land may undertake to return the river or stream to its own bed at
their own expense, provided that —
1. They secure permit from DPWH
2. The works pertaining commence within 2 years from the change in the course
 Branching of River – whenever the current of a river divides itself into branches, leaving a piece
of land of part thereof isolated, the owner of the land retain his ownership.

Islands which may be formed on the seas, within the jurisdiction of the Philippines, on lakes, and
on navigable rivers (can be used for trade) belong to the State.

Island which through successive accumulations of alluvial deposits are formed in NON-
NAVIGABLE and NON-FLOATABLE rivers, belong to the owners of the margins or banks nearest
 to them, or to the owners of both margins if the island is in the middle of the river, in which case
it shall be divided longitudinally in halves.

Co-Ownership – there is co-ownership whenever the ownership of an undivided thing or right belongs
to different persons. It exists whenever the ownership of an undivided thing or right belong to different
persons.

Possession – The holding of a thing or the enjoyment of a right.

 Possession in one own’s name

 Possession in the name of another

Usufruct – Usufruct is a real right by virtue of which a person is given the right to enjoy the property of
another with the obligation of preserving its form and substance, unless the title constitutions it or the
law provides otherwise.

Easement – an easement or servitude is an encumbrance imposed upon an immovable for the benefit of
another immovable belonging to a different owner. The immovable in favor of which the easement is
called the DOMINANT ESTATE, that which is subject thereto, the SERVIENT ESTATE.

 Easement of Right of Way – A right of way is a privilege constituted by contract or granted by

law to a person or class of persons to pass over another’s property when his own property is
surrounded by realties belonging to others without an adequate outlet to the public highway.

It is based on a real, not fictitious or artificial necessity. Mere convenience would not justify
imposing an easement or right of way.

FOREIGN OWNERSHIP OF LAND IN THE PHILIPPINES

 Aliens are not qualified to acquire land in the Philippine s(1987 Constitution)
 A deed of sale for a piece of land in favor of an alien is null and void for being contrary to law
(Ong Ching v. Court of Appeals)
 If land is invalidly transferred to an alien who subsequently becomes a Filipino citizen or
transfers it to a Filipino, the flaw in the original transaction is considered cured and title
transferee is rendered valid (Borromeo v. Descallar).

Exceptions:

 Aliens may acquire private lands by inheritance

o By intestate succession only; not through Last Will and Testament
 Under PD no. 713
o Americans (who were formerly Filipinos) can continue holding residential land acquired
prior to midnight of July 3, 1974.
o Citizens of the United States of America who were formerly citizens of the Philippines or
who on May 27, 1975 have resided in the Philippines continuously for at least 20 years,
and who in good faith had acquired private residential lands in the Philippines not
exceeding 5,000 square meters for a family dwelling before the expiration of the
 Philippine United State Trade Agreement on midnight July 3, 1974 may continue to hold
lands and to transfer ownership over such lands to qualified persons or entities.
o The same right is granted to those citizens of the United States who become permanent
residents of the Philippines and who acquired private residential lands in the Philippines
of not more than 5,000 square meters for a family dwelling.
 Under BP 185
o Aliens may be transferee of land – notwithstanding the provisions of the 1987
Constitution, a natural-born citizen of the Philippines who has lost his Philippine
citizenship may be a transferee of private lands, subject to limitations provided by law.
 Former natural-born Filipino citizen
 Maximum of 1,000 square meters of urban land OR 1 hectare of rural land
 A transferee may not acquire more than two lots
 A transferee who has already acquired urban land shall be disqualified from
acquiring rural land, and vice versa
 In case of married couple, one of them may avail of the privilege, if both shall
avail of the same, the total area acquired shall not exceed the maximum
allowed
 In case the transferee already owns urban or rural land for residential purposes,
he shall still be entitled to be a transferee of additional urban or rural lands,
provided it will not exceed the maximum
 Under RA No. 8179
o Limitation is 5,000 square meters or urban land or 3 hectares of rural land
o For business or other purposes (not residential)
 Under RA No. 9225
o Dual citizen

Lease of Private Lands to Aliens

 Private corporations may not hold alienable lands of the public domain except by lease, for a
period not exceeding 25 years, renewable for not more than 25 years, and not to exceed 1,000
hectares (1987 Constitution, Art. XII, Sec. 3)
 RA No. 7652 – Lease to foreign investors
o 50 years renewable once for a period of not more than 25 years
 PD No. 471 – Fixing a maximum period for the duration of lease of private lands to aliens
o 25 years, renewable for another 25 years

PNOC v. Keppel

 Almost 40 years ago or on 6 August 1976, the respondent Keppel Philippines Holdings, Inc.
(Keppel) entered into a lease agreement (the agreement) with Luzon Stevedoring Corporation
(Lusteveco) covering 11 hectares of land located in Bauan, Batangas. The lease was for a periof
of 25 years for a consideration of Php 2.1 million. At the option of Lusteveco, the rental fee
could be totally or partially converted into equity shares in Keppel.
 At the end of the 25-year lease period, Keppel was given the “firm and absolute option to
purchase” the land for Php 4.09 million, provided that it had acquired the necessary
qualification to own land under Philippine laws at the time the option is exercised. Apparently,
 when the lease agreement was executed, less than 60% of Keppel’s shareholding was Filipino-
owned, hence, it was not constitutionally qualified to acquire private lands in the country.
 The agreement was executed to enable Keppel to use the land for its shipbuilding and ship
repair business. The industrial/commercial purpose behind the agreement differentiates the
present case from Lui She where the leased property was primarily devoted to residential use.
Undoubtedly, the establishment and operation of a shipyard business involve significant
investments. Keppel’s uncontested testimony showed that it incurred Php 60 million costs for
solely for preliminary activities to take the land suitable as a shipyard, and subsequently getting
introduced improvements worth Php 177 million. Taking these investments into account and
the nature of the business that Keppel conducts on the land, we find it reasonable that the
agreement’s terms provided for an extended duration of the lease and a Restriction on the
rights of Lusteveco.
 We observed that, unlike Lui She, Lusteveco was not completely denied its ownership rights
during the course of the lease. It could dispose of the lands or assign its rights thereof, provided
it secured Keppel’s prior written consent. That Lusteveco was able to convey the land in favor of
(PNOC) during the pendency of lease should negate a finding that ownership of the land to
Keppel.

PROPERTY RELATIONS BETWEEN HUSBAND AND WIFE, LIVE-IN PARTNERS,

LOVER, AND MISTRESS
Property Relations

 Marriage is entirely governed by law. The nature, consequences, and incidents of marriage are
governed by law and not subject to stipulation between the spouses (Art. 1 FC).
 However, the law allows the spouses to agree or fix their property relations during the marriage.
This is through the execution of a “marriage settlement” (Art. 1 FC).

Art. 74, Family Code

Art. 74. The property relation between husband and wife shall be governed by the following order:

1. The marriage settlement executed before the marriage;

2. By provisions of this Code; and
3. By the local customs.

Marriage Settlement

 Also called Ante-Nuptial Agreement (Pre-Nuptial Agreement)

 It is the agreement entered into by the future spouses fixing the property regime that should
govern during the existence of marriage (Aquino, 60).

A marriage settlement of ante-nuptial contract is a contract which is entered into before, but in
contemplation and in consideration of, marriage, whereby the property relations of the spouses during
the marriage are fixed and determined (Rabuya, 671).

Art. 75, Family Code

Art. 75. The future spouses may, in the marriage settlements, agree upon the regime of absolute
community, conjugal partnership of gains, complete separation of property, or any other regime. In the
absence of marriage settlement, or when the regime agreed upon is void, the system of absolute
community of property as established in this Code shall govern.

Illustration:

Jose and Maria got married in the year 2019. What is their property relation?

a. If they execute a marriage settlement, then their property relation will be the one agreed upon.
b. If the marriage settlement they agreed upon is void, then the default property relation of
ABSOLUTE COMMUNITY OF PROPERTY will govern them.
c. If they did not execute a marriage settlement, then the default property relation of ABSOLUTE
COMMUNITY OF PROPERTY will govern them.

Note:

There is always a property relation/regime, even if the future spouses did not agree on one.

1. During the effectivity of the Family Code (from August 3, 1988) — Absolute Community of
Property
2. During the effectivity of the Civil Code )prior to August 3, 1988) — Conjugal Partnership of Gains

Requisites of Marriage Settlement

1. It must be entered into before the celebration of marriage;

2. It must be in writing;
3. It must be signed by the parties;
4. To affect third persons, it should be registered in the civil registry and registry of property; and
5. It must fix terms and condition of their property relations.

Note

 If the marriage does not take place, then the Marriage Settlement is void.
 However, if there are stipulations that do not depend upon the celebration of marriage, then
that stipulation shall be valid and shall remain in force (art. 80).

Example: “acknowledgement of an illegitimate child”

May the Parties Modify Their Marriage Settlement During the Marriage?

 Any modification in the marriage settlement must be made before the celebration of marriage
(Art. 76).
 Exception:
o The ACP or CPG was dissolved and liquidated upon a decree of legal separation (Art. 66).
o The spouses who were legally separated reconciled and agreed to revive their former
property regime (Art. 67).
o Judicial separation of property had been had on the ground that a spouse abandons the
other without just cause or fails to comply with his obligations to the family (Art. 128).
 o There was no judicial separation of property under Art. 135.
o The spouses jointly filed a petition for the voluntary dissolution of their community or
conjugal partnership of gains under Art. 136.

Art. 80, Family Code

Art. 80. In the absence of a contrary stipulation in a marriage settlement, the property relations of the
spouses shall be governed by Philippine laws, regardless of the place of the celebration of the marriage
and their residence.

This rule shall not apply:

1) Where both spouses are aliens;

2) With respect to the extrinsic validity of contracts affecting property not situated in the
Philippines and executed in the country where the property is located; and
3) With respect to the extrinsic validity of contracts entered into in the Philippines but affecting
property situated in a foreign country whose laws require different formalities for its extrinsic
validity.

Note:

 Lex Nationali – Property relations of Filipino spouses are governed by Philippines laws,
regardless of the place of the celebration of the marriage and their residence.
 Lex Rei Sitae – Issues relating to property, whether real or personal, are to be governed by the
law of the country where the property is situated.
 International Law Doctrine of Presumed Identity Approach (Processual Presumption) – Where a
foreign law is not proven, the presumption is that foreign law is the same as Philippine law.

Orient Savings Bank v. Suzuki

Suzuki purchased a property from Yung Sam Kang. The wife, Hyun Sook Jung, did not sign the Deed of
Sale.

Orient Savings Bank is saying that the sale is void because the wife did not sign. Citing that according to
Korean law, properties of the spouses must be disposed by both of them. However, the Korean law was
not proven in the Philippine Court.

The Court held that the sale by Yung Sam Kang to Suzuki is valid.

Under the Philippine Law, the phrase “Yung Sam Kang married to Hyun Sook Jung” is merely prescriptive
of the civil status of Kang. In other words, the import from the certificate of title is that Kang is the
owner of the properties as they are registered in his name alone, and that he is married to Hyun Sook
Jung.

We are not unmindful that in numerous cases we have held that registration of the property in the
name of only one spouse does not negate the possibility of it being conjugal or community property. In
those cases, however, there was proof that the properties, though registered in the name of only one
spouse, were indeed either conjugal or community properties. Accordingly, we see no reason to declare
as invalid Kang’s conveyance in favor of Suzuki for the supposed lack of Spousal consent.
Absolute Community of Property (ACP)
 The ACP shall commence at the precise moment that the marriage is celebrated. Any stipulation
for the commencement of the community regime at anytime hall be void (Art. 88).
 No waiver of rights, interests, shares and effects of the ACP during the marriage can be made
except in case of judicial separation of property (Art. 89).

What Constitutes Community Property

 Unless otherwise provided by law or in the M/S, the community property shall consist of all the
property owned by the spouses at the time of the celebration of the marriage or acquired
thereafter (Art. 91).
 Property acquired during the marriage is presumed to belong to the community, unless it is
proved that it is one of those excluded (Art. 93).

Excluded Properties

1. Property excluded by M/S 9Art. 91).

2. Property acquired during the marriage by gratuitous title by either spouse, and the fruits as well
as the income thereof, if any, unless it is expressly provided by the donor, testator or grantor
that they shall form part of the community property.
3. Property for personal and exclusive use of either spouse. However, jewelry shall form part of the
community property.
4. Property acquired before the marriage by either spouse who has legitimate descendants by a
former marriage, and the fruits as well as the income, if any, of such property (Art. 92).

Note:

 Richard and Lucy got married in the year 1998. Prior to their marriage, Lucy inherited a piece of
land in Cebu from his aunt. After their marriage, Lucy inherited a piece of land in Bacolod from
his uncle.
Is the Cebu property part of the ACP? Yes.
Is the Bacolod property part of the ACP? No.
 Kathryn and Daniel got married. Rustom donated a 10,000 sq. m. lot in Batangas to the newly
wed
Is the Batangas property part of the ACP? No.
If Rustom specifically mentioned that “ I am donating this land to you, Kathryn and Daniel, to be
part of your ACP”? Yes.
 Heart is married to Chiz. During the marriage, Heart Acquired the various designer bags and
pieces of jewelry.
Are the bags part of ACP? No.
Are the jewelry part of the ACP? Yes.
 Pete and Boots are husband and wife. Pete died in 2007, leaving Boots and their four children as
heirs. At the time of his death, the estate of Pete is at Php 100,000,000.00. From the said estate,
Boots inherited Php 20,000,000,00. In the year 2014, Boots got married to Francisco. They did
not execute a M/S. At the time of their marriage, the estate of Boots is worth Php
60,000,000.00.
 Is the Php 60,000,000.00 part of the ACP of Boots and Francisco? No.
The ACP will only cover the properties she may acquire during the subsequent marriage.

Sale or Exchange of Property

 If a separate property of either spouse is later on sold or exchanged for another property, will
the proceeds of the sale or the property so acquired remain separate property or be now part of
the ACP?
 If the old property is exclusive because of M/S, then the new property is now part of the ACP.
 If the old property is exclusive because of the mandatory provision of law (Art. 92), then the
new property is also exclusive.

According to Tolentino

“If such property, however, is later sold exchanged by the spouse who owns it for another property,
does the price or property so acquired become community property? The Family Code is silent on this
point. The Portuguese Code, from which the present article was taken, stamps the separate character,
not only on the property acquired from the donor or testator, but also upon any property which
substitutes it. We believe that this principle can be applied under our code; it is merely a necessary
consequence of the principle of separation of patrimonies. The mere alienation of separate property of
a spouse does not convert the price or the property acquired thereby into community property.”

Ownership, Administration, Enjoyment, and Disposition

 Administration – belong to both spouses jointly.

 In case of disagreement – decision of the husband will prevail, but wife can seek proper remedy
before the courts within five years from the date of the contract implementing such decision.
 The contract of the husband must cause “injury to the community or to the family: (Rabuya, p.
715).

Sole Power to Administer

1. In the event that one spouse is incapacitated or otherwise unable to participate in the
administration of the common properties, in which case, the other spouse may assume sole
power of administration, without need of court approval or authorization.
2. During the pendency of a legal separation case, the court hearing the case may designate either
of the spouses as sole administrator of the absolute community, in which case, the court-
appointed administrator shall have the same powers and duties as those of a guardian under
the Rules or Court.
3. If a spouse without just cause abandons the other or fails to comply with his or her obligations
to the family, the aggrieved spouse may petition the court for authority to be the sole
administrator of the absolute community

Disposition

 Under ACP, the disposition or encumbrance of community property must have the written
consent of the other spouse or the authority of the court without which the disposition or
encumbrance is void.
  The same is nevertheless considered as a continuing offer on the part of the consenting spouse
and the third person which may be perfected as a binding contract upon acceptance by the
other spouse or authorization by the court before the offer is withdrawn by either or both
offerors.

Flores v. Lindo

Wife mortgaged the property. She signed on behalf of her husband even though there is no SPA. Later,
the SPA arrived. When the REM was signed the wife is not authorized, therefore the REM is void. But it
is a continuing offer. The subsequent execution of the SPA is the acceptance by the other spouse that
perfected the continuing offer.

 Ellen and Derek got married in 2021. But due to differences, they separated de facto. Derek,
without the knowledge of Ellen, sold a community property. What is the remedy of Ellen?

The remedy of Ellen is to file an action for declaration of nullity of the contract entered into and
for the return of the property to the community. This type of action is not subject to
prescription since the contract under question is void.

Nobleza v. Nuega

 The Supreme Court ruled that the sale of a community property without the consent of the
other spouse is void in its entirety.
 The SC held that the RTC is wrong in declaring that the sale is null and void only in so far as ½
the portion of the property is concerned (share of wife).
 “In absolute community property, If the husband, without the consent of the wife sold the
property, then the entire sale is void.”

Uy v. Estate of Vipa Fernandez

 Levi Lahylahay and Vipa Fernandez got married in 1962 without a marriage settlement. In 1994,
Vipa dies. In 2005, Rafael purchased the ½ share of Levi over a parcel of land belonging to the
conjugal partnership without a previous liquidation of the conjugal partnership of Levi and Vipa.
 Under Art. 130, FC, the conjugal partnership property should be liquidated within one year from
the death of the deceased spouse. That absent any liquidation, any disposition or encumbrance
of the conjugal partnership property is void.
 Is the sale between Rafael and Levi valid? YES.
 Upon the termination of the CPG due to the death of either spouse, the surviving spouse has an
actual and vested one-half undivided share of the properties, which does not consist of
determinate and segregated properties until liquidation and partition of the conjugal
partnership.
 With respect to the deceased spouse’s share in the conjugal partnership properties, an implied
ordinary co-ownership ensues among the surviving spouse and the other heirs of the deceased.

Conjugal Partnership of Gains (CPG)

 The regime of conjugal partnership of gains (CPG) is a special type of partnership, where the
husband and wife place in a common fund the proceeds, products, fruits, and income from their
 separate properties and those acquired by either or both spouses through their efforts or by
chance.
 Upon dissolution of the marriage or the partnership, the net gains or benefits obtained by either
or both spouses shall be divided equally between them, unless otherwise agreed in the marriage
settlement.
 For marriage solemnized under the Family Code, the CPG must be agreed upon in the M/S in
order for it to be the governing regime between the spouses.
 For marriage solemnized under the New Civil Code, CPG is the default property regime.
 However, the provisions of the Family Code on CPG are also made applicable to conjugal
partnership of gains established before its ineffectivity unless vested rights have already been
acquired under the New Civil Code or other laws.

Exclusive Property of Each Spouse in CPG

1. That which is brought to the marriage as his or her own

2. That which each acquires during the marriage by gratuitous title
3. That which is acquired by right of redemption, by barter or by exchange with property belonging
to only one of the spouses; and
4. That which is purchased with exclusive money or of the husband.

The property of either spouse that he or she brings to the marriage remains as his or her exclusive
property in the regime of conjugal partnership of gains, although the fruits and income thereof are
considered conjugal partnership money.

In CPG, any property acquired by either spouse during the marriage through gratuitous title is exclusive
property. However, the fruits and income of the separate properties of the spouses are conjugal assets.

 A property that is acquired by either spouse through the exercise of a right of redemption is
exclusive property of the redemptioner-spouse regardless of the source of money used to
redeem said property.
 In CPG, the law protects the separate character of the exclusive properties of either spouse.
Hence, whatever is acquired through the use of exclusive money of either spouse shall also be
considered as exclusive property of the owner of the funds.

Note:

 The spouses retain the ownership, possession, administration, and enjoyment of their exclusive
properties (Art. 110).
 Either spouse may mortgage, encumber, alienate, or otherwise dispose of his or her exclusive
property (Art. 111).

Perspective

 Isko (46) and Diana got married in 2000. ACP

 Manny (42) and Jinky got married on May 10, 1999. ACP
 Bongbong (64) and Lisa got married on April 17, 1993. CGP
 Jesse (+) and Leni (56) got married in 1987. CGP
 Ping (74) and Alice got married in 1973. CGP
Property Acquired During the Marriage

 All property acquired during the marriage, whether the acquisition appears to have been made,
contracted, or registered in the name of one or both spouses, is presumed to be conjugal unless
the contrary is proved (Art. 116).
 Disputably presumed. Rebuttable with strong, clear, categorical, and convincing evidence.
 The presumption applies even if the acquisition appears to have been made, contracted, or
registered in the name of one or both spouses.
 Note: Check the date—wedding and the title/tax declaration.

Dela Pena v. Avila

 The property is registered in the name of “Antonia R. Dela Pena, of legal age, Filipino, married to
Antegono A. Dela Pena,” it was held that the phrase “married to” is merely descriptive of the
civil status of the wife and cannot be interpreted to mean that the husband is also a registered
owner.
 The registration of the property in said manner does not constitute proof that the same was
acquired during the marriage because it is likewise possible that the property was acquired by
the wife when she was still single and registered only after marriage.

Note: Even if the property was acquired during the marriage, the presumption in favor of
conjugality cannot be applied with respect to private lands if one of the spouses is an alien, for
this will violate Section 7, Article XII of the 1987 Constitution prohibiting aliens from acquiring
private lands in the Philippines.

The Following are Conjugal Properties:

 Property acquired during the marriage by onerous title

o Acquired during the marriage by gratuitous title = exclusive
o Acquired through onerous title + funds used exclusive = exclusive
o Acquired through onerous title + funds used conjugal = conjugal

The property is conjugal regardless of whether the acquisition is in the name of conjugal
partnership or in the name of only one of the spouses.

 Property obtained from labor, industry, work, or occupation

 Property acquired through occupation
 Fruits and income of separate property
 Livestock
 Property acquired by chance.

ART. 118, Family Code

Art. 118. Property bought on installments paid partly from exclusive funds of either or both spouses and
partly from conjugal funds belongs to the buyer or buyers in full ownership was vested before the
marriage and to the conjugal partnership if such ownership was vested during the marriage. In either
case, any amount advanced by the partnership or by either or both spouses shall be reimbursed by the
owner or owners upon liquidation of the partnership.

ART. 120, Family Code

Art. 120. The ownership of improvements, whether for utility or adornment, made on the separate
property of the spouses at the expense of the partnership through the acts or efforts of either or both
spouses shall pertain to the conjugal partnership or to the original owner-spouses, subject to the
following rules:

When the cost of the improvement made by the conjugal partnership and any resulting increase in value
are more than the value of the property at the time of the improvement, the entire property of one of
the spouses shall belong to the conjugal partnership, subject to the reimbursement of the value of the
property of the owner-spouses at the time of the improvement; otherwise, said property shall be
retained in ownership by the owner-spouse, likewise subject to reimbursement of the cost of the
improvement.

In either case, the ownership of the entire property shall be vested upon the reimbursement, which
shall be made at the time of the liquidation of the conjugal partnership.

Administration of CPG

 Administration – belong to both spouses jointly

 In case of disagreement – decision of the husband will prevail, but wife cans eek proper remedy
before the courts within five years from the date of the contract implementing such decision.

Sole Power of Administration

1. In the event that on espouse is incapacitated or otherwise unable to participate in the

administration of the common properties, in which case, the other spouse may assume sole
power of administration, without need of court approval or authorization.
2. During the pendency of a legal separation case, the court hearing the case may designate either
of the spouses as sole administrator of the absolute community, in which case, the court-
appointed administrator shall have the same powers and duties as those of a guardian under
the Rules of Court.
3. If a spouse without just cause abandons the other or fails to comply with his or her obligations
to the family, the aggrieved spouse may petition the court for authority to be the sole
administrator of the absolute community.

Disposition

 In case of sale of conjugal property without consent of the other spouse, the sale is still void
even on the supposition that the spouses only disposed of their respective shares in the
property because “the right of the husband or the wife to one-half of the conjugal assets does
not vest until the liquidation of the conjugal partnership.” [Abalos v. Macatangay, Jr.]

Exception: Carlos v. Tolentino case; The wife died pending the litigation.

Buyer in Good Faith

  The SC erected a standard to determine the good faith of the buyers dealing with a seller who
had title to and possession of the land but whose capacity to sell was restricted, in that the
consent of the other spouse was required before the conveyance, declaring that in order to
prove good faith in such a situation, the buyers must SHOW that they INQUIRED not only into
the title of the seller BUT also in the seller’s capacity to sell.
 Diligence in verifying the validity of the title covering the property; and
 Diligence in inquiring into the authority of the transacting spouse to sell conjugal property in
behalf of the other spouse.

Separation in Fact

 A mere separation in fact between the spouses does not bring about a regime of separation of
property.
 When the spouses have been separated in fact for at least one year and reconciliation is highly
improbable, either spouse may petition for separation of property (Art. 135).

Complete Separation of Property

 In CSP, each spouse shall own, possess, dispose of, administer, and enjoy his or her own
separate property, whether acquired prior to the marriage or during the marriage, without need
of the consent of the other.
 All earnings by each spouse from his or her profession, business, or industry and all fruits, due or
received during the marriage from his or her separate property shall likewise belong to him or
her.
 Both spouses shall bear the family expenses in proportion to their income/market value of their
separate properties.
 Solidarily liable to the creditors in connection with such family expenses.

Property Regime of Unions Without Marriage

 In a void marriage, regardless of the cause thereof, the property relations of the parties during
cohabitation are governed by the provisions of Article 147 or Article 148 of the Family Code.
 A man and a woman suffering no legal impediment to marry each other, so exclusively live
together as husband and wife under a void marriage or without the benefit of marriage.
 Article 147 applies only fi the following requisites are present:
o Both must be capacitated to marry each other; and
o There is no marriage or the marriage is void.
 Both requisites must concur.
 If a married man cohabits with an unmarried woman, Art. 147 does not apply.
 Their wages and salaries- owned in equal shares by both the man and the woman.
 Property acquired by both through their work or industry – rules of co-ownership shall apply
(this means proportionate to their efforts in the work or industry)
o The presumption is that the effort, work, or industry is JOINT and therefore the shares
are equal.
o Care and maintenance of the family and household – deemed to be joint an equal.

What are the Properties of Said Union Which are Governed by the Rules of Co-Onwership?
They are (1) the property acquired by either or both of them through their work or industry; and (2)
their wages and salaries.

Hence, donated, inherited, or purchased properties are NOT COVERED except that in case of
“purchases,” they are co-owned if obtained in exchange or substitution of (1) or (2).

Example: Car purchased by salary = co-owned; car purchased by inherited cash = not co-owned

 LJ and Paolo lived together as husband and wife for the past three years. Because of a trip in
Baguio City, LJ and Paolo ended their relationship. During their cohabitation, they acquired a
condominium unit, registered under the name of LJ. LJ is now selling the property to you. Should
you get consent of Paolo?

In the absence of proof to the contrary, properties acquired while the parties lived together are
presumed to have been obtained by them in equal shares under a state of co-ownership. During
their cohabitation, neither party is allowed to dispose or encumber his or her shares by acts
inter vivos without consent of the other. But the prohibition no longer applies after the
termination of the cohabitation.

ART. 148, Family Code

 If the cohabitation between a man and a woman does not comply with the requisites
enumerated in Art. 147, the applicable property regime is the one provided in Art. 148.
 When a man and a woman who are not capacitated to marry each other live exclusively as
husband and wife;
 When the parties do not live exclusively with each other;

BASIC LAND REGISTRATION

Land Registration – a judicial or administrative proceeding whereby a person’s claim of ownership over
a particular land is determined and confirmed or recognized so that such land and the ownership
thereof may be recorded in a public registry.

Purposes of Land Registration

 To issue a certificate of title to the owner which shall be the best evidence of his ownership of
the land described therein
 To give every registered owner complete peace of mind
 To relieve the land of unknown claims
 To quite the title to land and stop forever questions as to its legality
 To avoid conflicts of title in and to real estate, and to facilitate transactions
 To guarantee the integrity of land titles and to protect their indefeasibility once the claim of
ownership is established and recognized

Torrens System

 The Torrens System of land registration as introduced in the Philippines by Act No. 497, which
took effect on February 1, 1903.
  This law was amended by PD No. 1529, which took effect on June 11, 1978, otherwise known as
the “Property Registration Decree.”
 PD No. 1529 is the principal law now governing land registration in the Philippines.

Judicial Land Registration – is a proceeding where the application for land registration is filed in the
proper court.

Kinds of Judicial Land Registration

 Ordinary Land Registration proceeding – where the application for land registration is initiated
and filed in court by the owner or person claiming ownership of the land
 Cadastral Land Registration proceeding – where it is the government that undertakes the survey
of the land and files the petition in court for the registration of the whole or part of the lands in
a municipality, city, or province, and where all persons are given notice by publication and
required to make known and prove their claims of ownership or interest over the same,
otherwise, the lots will be declared public land.

The court, after hearing the application for land registration and as warranted by the evidence, shall
render judgment confirming the title of the applicant and ordering (1) the Land Registration
Authority to issue the decree of registration; and (2) for the Register of Deeds to issue the
corresponding Original Certificate of Title to the applicant or adjudged owner.

Administrative Land Registration – is a proceeding where the application for a Free Patent, Homestead
Patent, Sales patent, or other grant of public land is filed in, and determined by the Department of
Environment and Natural Resources (DENR).

If the application is granted, the DENR issues a patent for the land applied for. Such patent shall be
registered in the office of the Register of Deeds who shall then issue the corresponding certificate of title
in the name of the registered owner.

In both judicial and administrative proceedings, the Register of Deeds makes the proper entries in his
Record Book and issues the corresponding owner’s duplicate certificate of the ORIGINAL CERTIFICATE
OF TITLE to the registered owner.

Certificate of Title
Torrens Certificate of Title – is the evidence of ownership issued by the Register of Deeds to the owner
of a particular land which is registered under the Torrens System of registration. A certificate of title may
be an Original Certificate of Title or a Transfer Certificate of Title.

A certificate of title accumulates in one document a precise and correct statement of the exact status of
the real interest held by its owner.

Original Certificate of Title – is the first title issued in the name of a registered owner by the Register of
Deeds covering a parcel of land which had been registered under the Torrens System, by virtue of
judicial or administrative proceedings.
A parcel of land is registered is registered under the Torrens System by the entry made by the Register
of Deeds in his Record Book of an Original Certificate of Title in the name of the person who has been
declared to be the owner of the land pursuant to judicial or administrative proceedings.

As a rule, the Original Certificate of Title consists of one original copy and one owner’s copy (also known
as, “Owner’s Duplicate Certificate of Title”). However, if two or more persons are the registered
owner’s, one owner’s duplicate may be issued for the whole land, or if the co-owner’s so desire, a
separate duplicate may be issued to each of them in like form. The RD shall note on each certificate of
title a statement as to whom a copy thereof was issued.

Under the law, the RD shall in each case make an exact duplicate of the OCT but putting on it the words
“Owner’s Duplicate Certificate.” The original of the said OCT is filed in the Office of the Register of
Deeds, whereas the “owner’s duplicate certificate” thereof is delivered to the owner.

Transfer Certificate of Title – is the title issued by the Register of Deeds in favor of a transferee to whom
the ownership of the registered land has been transferred by virtue of a sale or other modes of
conveyance. The original of the Transfer Certificate of Title is filed in the registry of deeds, whereas the
duplicates thereof which shall be called “owner’s duplicate” shall be delivered to the transferee or new
owner.

The TCT is issued in lieu of the certificate of title of the transferor which is cancelled by virtue of transfer
of ownership.

Principles or Doctrines – Torrens System

 A Torrens Certificate of Title is the best evidence of ownership of the land described therein
 A Torrens title give notice to the whole world; it binds the whole world. The issuance of a
certificate of title is a constructive notice thereof to all persons. Registration of sale in the
Registry of Deeds constitutes notice thereof to the whole world. No one can plead ignorance of
the registration.
 All claims and liens of whatever character existing against the land prior to the issuance of
title are barred, if not noted on said certificate. The registered owner of a Torrens Certificate of
Title and the subsequent purchaser for value and in good faith of registered land shall hold the
certificate, free from all liens and encumbrances, except those noted in said certificate.
 Title to the property covered by a Torrens certificate becomes incontrovertible or indefeasible
after one year from the entry of the decree of registration (serves as an evidence).
 A Torrens title is imprescriptible. No title to registered land in derogation of the title of the
registered owner shall be acquired by prescription or adverse possession. The owner of the land
registered under the Torrens System cannot lose it by prescription.
 The integrity of the Torrens System must be protected. Every person dealing with registered
land may safely rely on the correctness of the certificate of title issue thereof and the law will in
no way oblige him to go behind the certificate to determine the condition of the property.
Stated differently, an innocent purchaser for value, relying on a Torrens title issued, is protected.
 A certificate of title shall not be subject to collateral attack. It cannot be altered, modified, or
cancelled, except in a direct proceeding in accordance with law.
 Fraudulent Registration. The person whose name the land is fraudulently registered holds it as
a mere trustee, with the legal obligation to reconvey the property and the title thereto in favor
 of the true owner. A Torrens title cannot be used as a shield for fraud or for enriching a person
at the expense of another. The Torrens System was not designed to shield and protect one who
had committed fraud or misrepresentation and thus holds title in bad faith. The Torrens system
only protects a title holder in good faith, and cannot be used as shield for fraud. Deceit is not to
be countenanced duplicity is not to be rewarded.
 Forgery. Any registration procured by the presentation of a forged duplicate certificate of title,
or a forged deed or other instrument shall be null and void. A forged instrument may become
the “root of a valid title” if the certificate of title has already been transferred from the name of
the true owner to the name of the forger or the name indicated by the forger. The doctrine that
a forged instrument may become the root of a valid title cannot be applied where the owner still
holds a valid and existing certificate of title covering the same.
 Loss as between two innocent persons, the one who made it possible for the wrong to be done
should be the one to bear the resulting loss. As between two persons, both of whom are in
good faith and both innocent of any negligence, the law must protect and prefer the lawful
holder of registered title over the transfer of a vendor bereft of any transmissible rights.
 Prior Tempore Potior Jure – He who is first in time is preferred in right. The act of registration in
the Registry of Deeds shall be the operative act to convey or effect the land insofar as third
persons are concerned.
 Double Titles. Where two certificates of titles include the same land, the certificate that is
earlier in date prevails.
 A Torrens title is presumed to have been issued regularly and legally. A strong presumption
exists that a Torrens title is regularly issued and that it is valid, unless contradicted and
overcome by clear, convincing, strong, and irrefutable proof. More than merely preponderance
of evidence is required. The presumption is that the transferee of registered land is not aware of
any defect in the title of the property he purchased.
 Every person dealing with registered land may safely rely on the correctness of the certificate
of title issued therefor. One who deals with property registered under the Torrens system need
not go beyond the same, but only has to rely on the title. He is charged with notice only of such
burdens and claims as are annotated on the title. EXCEPTION: Actual Knowledge.
 If a Certificate of Title is void, all subsequent Certificates of Title derived therefrom are also
void because of the truism that the “Spring cannot rise higher than its source.” The truism is in
accord with the Latin maxim: “Nemo protest plus juris ad alium transfere quam ipse habet.”- No
one can transfer a greater right that he himself has.

Land Registration Process

Hypothetical Case

 Subject land: Balintawak, Lipa City

 Applicant: Antonio P. Dela Rosa
o Son of Daphne P. Dela Rosa
o Daphne is the daughter of Teodoro Pena

Flow of presentation

 Survey
 WHAT: Two-dimensional map showing the metes and bounds of a surveyed parcel or parcels of
land and other pertinent information

HOW: Applicant goes to DENR Regional Office  DENR Regional Office to give list of accredited
land surveyors  Applicant to give certificate of title/tax declaration to surveyor  Surveyor
shall measure the land  Survey plan to be prepared by the surveyor  Accomplished survey
plan forwarded to DENR Regional Office  Inspection by authorities from DENR Regional Office
 After approval, proceed to next step for application

RELEVANT PARTS OF THE SURVEY PLAN:

1. Name of owner of land or to whom the survey is being conducted for
2. Name or number of lot and where it is located
3. Technical descriptions
4. Lot illustration
5. Notes on the lower left portion
6. Necessary signatures

SIGNIFICANCE:
1. Fixing the exact identity of the land
2. Avoid overlapping of boundaries with adjoining lots
3. Jurisdiction of the court

LAND ADMINISTRATION AND MANAGEMENT SYSTEM (LAMS) e-Survey Plan

o Windows application for the preparation of survey plans in the digital land survey data
(DLSD) format
o Allows the client, through an accredited geodetic engineer, to submit the survey
application online for faster verification of boundaries

 Contents of the petition

1. Full description of the land as evidenced by a survey plan duly approved by the Director
of Lands, surveyor’s certificate, and technical description
2. Citizenship and civil status of the applicant, whether single or married, and if married,
name of the wife or husband, and, if the marriage has been legally dissolved, when and
how the marriage relation terminated
3. Full names and addresses of all occupants of the lands and those of the adjoining
owners, if known, and, if not known, it shall state the extent of the search made to find
them
4. Assessed value of the land and the buildings and improvements thereon
5. Whether or not there are mortgages or encumbrances of any kind whatsoever affecting
the land, or any other person having interest therein, legal or equitable, or in
possession, thereof
6. The manner by which the applicant has acquired the land (see Section 14 of PD 1529)
7. Whether or not the property is conjugal, paraphernal, or exclusive property of the
applicant
 8. Names of all the occupants of the land, if any
9. Original muniments of title and other related documents supporting applicant’s claim of
ownership
10. If the land is bounded by a public or private way of road, whether or not the applicant
claims and what portion of the land within the limits of the way or road, and whether
the applicant desires to have the line of the way or road determined

 Accompanying documents
1. Proof of Ownership (Deed of Absolute Sale)
2. Extrajudicial Settlement Form (Extrajudicial Settlement of Estate)
3. Deed of Donation
4. Tax Declaration
a. Inform the Clerk
b. Submit all Required Documents
c. Ocular Inspection of Real Property
d. Preparation and Processing of Updated Tax Declaration
e. Evaluation and Recording of Tax Declaration
f. Issuance of Owner’s Tax Copy
g. Client Sign at Logbook
5. Certification of Adjoining Owners
a. WHERE: Assessor’s Office
b. REQUIREMENTS:
i. TMD Form
ii. Photocopy of ID
iii. Photocopy of Title or Real Property Tax Receipt or Identification of
Property Location through RPV
c. PROCESS: Submit Form  Pay  Present Official Receipt  Receive Certificate
6. Affidavit of Adjoining Owners
7. Barangay Certification
8. Alienable and Disposable Land Certificate
a. WHERE: DENR – CENRO (City Environment and Natural Resources Office)
b. REQQUIREMENTS:
i. Filled-out Online Application Form of Letter of Application/Intent
ii. Authenticated copy of ownership to the land – Original Land Title,
Transfer Certificate of Title, Certificate of Land Ownership Award, or Tax
Declaration of Untitled Alienable and Disposable Land
c. PROCESS: Submit  Pay  Present Official Receipt  Receive Certificate

 Court proceedings
WHO: Applicant under Section 14, P.D. No. 1529

WHAT: Petition for registration of title

o Application Form
o Accompanying Documents
  3 copies of technical description duly verified and certified by Regional Technical
Director or his authorized representative
 3 copies of certificates from the surveyor/Geodetic Engineer/certificate of non-
availability from the Regional Technical Director
 4 copies of the latest Tax Declaration or Assessment Certificate from Assessor’s
Office where the land is situated

WHEN (DURATION): Within 1 year to 5 years depending on:

o Availability of the court
o Complexities of the case
o Existence of oppositors
o Availability of witnesses and documentary evidence
o Place where the petition will be filed

WHERE: RTC of province or city where the land is situated

Delegated jurisdiction of first level courts in land registration cases (RA 7691)
1. Where the lot is not the subject of controversy; or
2. Where the lot is contested but the value thereof does not exceed P100,000

Note: Appeals from decisions of inferior courts in land registration cases are taken to the
Court of Appeals

HOW: Filing of petition with RTC of province/city where land is located  Issuance of notice of
hearing  Initial hearing  Filing of opposition/s  When no opposition, order of default 
Presentation of evidence  Rendering of decree/judgment

- Judgment rendered becomes final upon expiration of 30 days from date of receipt of notice
of judgment
- Appeal may be taken
- When judgment is final and executory, court shall issue order of issuance of the decree of
registration and corresponding certificate of title

Notice of Initial Hearing

I. Issuance of the Order

The court shall, within five days from filing of the application, issue and order setting the date
and hour of the initial hearing which shall not be earlier than forty-five days nor later than
ninety days from the date of the order. (Sec. 23, P.D. 1529)
o Date of filing: April 26, 2022
o Date of issuance of order: April 29, 2022
o Date of initial hearing: June 13, 2022 – July 28, 2022 9June 28, 2022)

II. Transmittal
The clerk of court shall admit to the Land Registration Authority the order setting the initial
hearing, copy of the application and other pertinent documents
III. Publication
The Commissioner of the Land Registration should cause the publication of the notice of initial
hearing once in the Official Gazette and once in any newspaper of general circulation. (Sec.
23(1), P.D. 1529)

Purpose of the Publication

o Objective 1: To confer jurisdiction upon the court over the res
o Objective 2: To apprise the whole world of the pending registration case so that they
may assert their rights or interests in the land, if any and oppose the application, if so
minded
IV. Service of Notice: Mailing & Posting
Sec. 23(2), P.D. 1529

By mailing.
a) Mailing of notice to person named in the publication. The Commissioner of Land
Registration shall also, within seven days after publication of said notice in the Official
Gazette, as hereinbefore provided, cause a copy of the notice of initial hearing to be
mailed to every person named in the notice whose address is known.
b) Mailing of notice to the Secretary of Public Highways, the Provincial Governor and the
Mayor. If the applicant requests to have the line of a public way or road determined, the
Commissioner of Land Registration shall cause a copy of said notice of initial hearing to
be mailed to the Secretary of Public Highways, to the Provincial Governor, and to the
Mayor of the municipality or city, as the case may be, in which the land lies.
c) Mailing of notice to the Secretary of Agrarian Reform, the Solicitor General, the Director
of Lands, the Director of Public Works, the Director of Forest Development, the Director
of Mines and the Director of Fisheries and Aquatic Resources. If the land borders on a
river, navigable stream or shore, or on an arm of the sea where a river or harbor line has
been established, or on a lake, or if it otherwise appears from the application or the
proceedings that a tenant-farmer or the national government may have a claim adverse
to that of the applicant, notice of the initial hearing shall be given in the same manner to
the Secretary of Agrarian Reform, the Solicitor General, the Director of Lands, the
Director of Mines and/or the Director of Fisheries and Aquatic Resources, as may be
appropriate.

Example:
To the Honorable Solicitor General, Office of the Solicitor general, 134 Amorsolo St., Legaspi
Village, Makati City; the Regional Director, Region IVA-DENR, Barangay Mayapa, Calamba City;
the Hon. Secretary, Department of Public Works and Highways, Bonifacio Drive, Port Area,
Manila; the Director, Bureau of Mines, Pedro Gil St., Malate; the Director, Bureau of Fisheries
and Aquatic Resources, P.O. Box 623, both in Manila; the Hon. Secretary, Department of
Agrarian Reform, PTA Bldg., Elliptical Road, Diliman; the Director, Forest Management Bureau,
Visayas Avenue, Diliman; the Director, Land Management Bureau, DENR Bldg., 880 F.R. Estuar
Building, Quezon Avenue, Brgy. Paligsahan, all in Quezon City, Metro Manila; the Provincial
 Governor, the Provincial Prosecutor, the General Services Officer, the Provincial Engineer, the
Public Owrks and Highways District Engineer, all in Batangas; the CENR Officer, CENRO, Land
Management Services, Lipa City, Batangas; the City Mayor, the City Council, Lipa City, Batangas;
Antonio P. Dela Rosa, Teodoro Pena, Carlito Pena, Juan Pena, Jose Pena, and Luzviminda Pena,
all in Lipa City, Batangas; AND TO WHOM IT MAY CONCERN:

Sec. 23(3), P.D. 1529

By posting.

The Commissioner of Land Registration shall also cause a duly attested copy of the notice of
initial hearing to be posted by the sheriff of the province or city, as the case may be, or by his
deputy, in a conspicuous place on each parcel of land included in the application and also in a
conspicuous place on the bulletin board of the municipal building of the municipality or city in
which the land or portion thereof is situated, fourteen days at least before the date of initial
hearing.

Proof of Publication and Notice

o Notice of initial hearing
o The Certification of Publication of the Notice of Initial Hearing issued by the Director of
the National Printing Office
o Affidavit of Publication of the Notice of Initial Hearing of the Editor of any newspaper of
general circulation
o Affidavit of the Commissioner and Land Registration and the Registry Receipt issued by
the Mailing Office
o Affidavit and Certification of Posting by the Deputy Sheriff

An Introduction to Agency Law

Who is an ‘agent’?

An agent is someone who is authorized to represent or act for another person (the principal) in dealings
with third parties.

 Special Legal Relationship – the agent is given the authority to legally bind the principal.
o Negotiate and sign a contract
o Knowledge of the agent is knowledge of the principal
o Agent’s wrongful act can be imputed to the principal
 Importance of Agency
o To extend the personality of the principal
o The agent is considered the extensions of the principal
 Agent’s Authority
o Comes from the principal
o Can be EXPRESS or IMPLIED
 Express – expressly communicated either orally or in writing
  Implied – inferred by the conduct of the principal indicating his intent to confer
it or causing the agent to believe he possess it

Note: The agency is presumed from the acts of the principal, from his silence or lack of action, or
his failure to repudiate the agency, knowing that another person is acting on his behalf without
authority.

Note: Ostensible Agency or Agency by Estoppel – The ostensible agent is acting as though he is
authorized and the principal words or conduct seem to back that up.

Types of Agents

1. Universal – authorized by the principal to do EVERYTHING that can be done by a lawfully

designated representative.
2. General – has authority to handle of all matters for the principal in a specified area. [all business
of the principal]
3. Special – has limited authority to do a specific thing or conduct a specific transaction. [one or
more specific transactions]

A universal agent is a person authorized to transact all the business of his principal of every kind. He is
authorized to perform all acts or duties which his principal is empowered to perform. Usually, universal
agents are appointed by a power of attorney.

A principal can have but one universal agent. He may have a general agent in each line of his business,
and in each of several places. He may employ as many special agents as occasion may require. A
universal agency is of very rare occurrence, the great majority of the case being those which involve
some form of general of special agency. [Baldwin v. Tucker, 112 Ky. 282 (Ky. 1901)].

Note: Real estate brokers are special agents.

Although a broker is an agent, the term broker is somewhat less inclusive than the term agent. The term
broker generally applies to an agent who, for a commission or brokerage fee, acts as a negotiator or
intermediary between the principal and third persons in connection with the acquisition of contractual
rights, or the sale or purchase of property, real or personal, where the custody of the property is not
entrusted to him, for the purpose of discharging the agency.

Creating An Agency Relationship

 Oral or written agreement

 Special Power of Attorney – a document that appoints another person as an agent and defines
the scope of the agent’s authority
 Attorney-in-Fact – the agent under a power of attorney.
 Written Listing Agreement or Authority to Sell – given to a real estate broker; serves as authority

1. Agency relationship by RATIFICATION

2. Agency by ESTOPPEL – the purpose of agency by estoppel is to protect innocent third parties
who have reasonably assumed that a person has authority to act for the principal. The principal
 is held responsible because he failed to advise the third party that the apparent agent was
acting without authority.

Salesperson: The Broker’s Agent

The salesperson is not the seller’s agent but the broker’s agent

Terminating an Agency

A. Accomplishment of purpose
B. Expiration of the agency term
C. Operation of law
o Either party dies or becomes incapacitated
o Either party goes bankrupt or insolvent
o The property subject of agency is destroyed
o The agent loses his license
o Conflict of interest arise between the parties
D. Mutual Agreement
E. Renunciation (Withdrawal) by the agent
o Notice must be given to the principal
o No damages must be sustained by the principal because of the withdrawal
o Principal must have the reasonable opportunity to take the necessary steps to address
the withdrawal of the agent
F. Revocation by the principal
o Must be made by the principal
o Can be done expressly or impliedly; there is implied revocation when:
 The principal appoints a new agent for the same business or transaction covered
by a previous agency
 When the principal directly manages the business entrusted to the agent,
dealing directly to third persons
 When the agent executes an SPA as regards a special matter covered by a GPA

Example:

Agency Coupled with Interest – a broker loans funds to a contractor to complete the building of
a home. In addition to agreeing to repay the loan, the contractor gives the broker an exclusive
authority to sell the property when the home is completed. Before the home is sold, the
contractor dies. The agency is not automatically terminated by the contractor’s death, because
the broker has an interest in the company.

Sale of Piece of Land – when a sale of piece of land or any interest therein is through an agent,
the authority of the agent shall be in writing otherwise the sale shall be void.

Agency Couched in General Terms – comprises ONLY ACTS OF ADMINISTRATION; even if the
principal should state that he withholds no power or that the agent may execute such acts as he
 may consider appropriate, or even though the agency should authorize a general and unlimited
management.
o Specific powers are given to the Agent
o SPA is needed:
 Contract which the ownership of an immovable is transmitted or acquired
 Lease any real property to another for more than one year
 Create or convey real rights over immovable property

SPA – a special power to sell excludes the power to mortgage; and a special power to mortgage does not
include the power to sell; Even if the document is entitled GENERAL POWER OF ATTORNEY and even if
general powers of administration are also conferred, the requirement for a special power of attorney is
complied with if the general power of attorney includes specific powers.

Duties of Agent to the Principal

 Reasonable Care and Skill

o Claiming Expertise
o Unauthorized Practice of Law
 Obedience, Good Faith, and Loyalty
o Diligence
o Confidentiality
o Disclosure of material information

Note: The acronym ACOLD will help you remember your duties in a fiduciary relationship. As an agent,,
you must:

1. Be Accountable
2. Use Care and skill
3. Obey legal instructions
4. Be Loyal to your client
5. Disclose all pertinent information.

Obligations of the Principal

 To comply with all obligations which the agent may have contracted within the scope of his
authority.
 To advance to the agent, should the latter so request, the sums necessary for the execution of
the agency
 To reimburse the agent, even if the business or undertaking was not successful, provided the
agent is free from all fault
 To indemnify the agent for all the damages which the execution of the agency may have cause
the agent

Obligation of an Agent

 To carry out the agency

 To act within the scope of his authority
 To act in accordance with the instruction of the principal
  To prefer the interest of the principal
 To render accounting

Legal Concerns in Buying and Selling

Basic Principles on the Law of Contract

 Contract of Sale is perfected by mere consent.

 Contract of Sale need not be in writing to be valid. The written document is necessary for
enforceability not for validity.
 The moment the contract is performed (even partially), it is now outside the realm of
unenforceable.
o It doesn’t need to be in writing anymore to be fully enforced.
o Oral evidence is sufficient.
 The essential elements of a contract of sale:
o Consent
 Must be free, intelligent, voluntary, and conscious.
 Must not be obtained by mistake, violence, intimidation, undue influence, &
fraud.
 Remember: There is consent when the offer was accepted.
 The offer must be certain
 The acceptance must be absolute
 A qualified acceptance constitutes a counter offer
 Difference between contract and document:
 Contract is the agreement per se
Ex. Contract of Sale, Contract to Sell
 Document is the written form of the agreement
Ex. Deed of Absolute Sale, Deed of Conditional Sale, Contract to Sell
o Object
 The “What” (What is the object of the contract of sale? What is being sold?
What is being bought?)
 For our purposes:
 Land
 House & Lot
 Condominium
 Townhouse

*It must be within the commerce of men

o Cause (Price)
 The “Why” (Why are you selling? [I need the money (price)] Why are you
buying? [I need the object])
 Motive is different from cause; Motive is the why of the cause – (Why do you
need the money? Why do you need the object?)
 Individual/Citizenship

Seller Buyer
Filipino Citizen
Alien Inheritance
Former Filipino BP 185; RA 8179
Dual Citizen RA 9225

Individual/Age

Seller Buyer
Legal Age
Minor Represented by a guardian; Represented by a guardian;
Appointed by court; Appointed by court;
Admin only Admin only

Individual/Civil Status

Seller Buyer
Single
Married Both must sign; Both must sign;
VOID UNENFORCEABLE
Legally Separated Entry of Judgment; Entry of Judgment
Subdivision of property with TCT
Widow/Widower Certificate of Marriage, Death, Marriage and Death Certificate
Birth
Settlement of Estate or SPA
Separated De Facto As if married As if married

Individual/Domicile

Seller Buyer
Local
International Document must be authenticated
before the Philippine Consulate. -SAME-
OR appoint a local attorney in fact;
But the SPA must be duly authenticated

Individual/Number

Seller Buyer
Sole
Joint/Multiple All must sign -SAME-
One may be appointed as Atty-in-Fact
 Corporate

Seller Buyer
Juridical Person Must be duly authorized to sell the -SAME-
property to authority – to sell and to
sign

Warranties:

 Warranty against eviction

 Warranty against hidden defect

This is implied in a contract of sale. You may remove it if you want.

Remedies:

 Specific Performance
 Cancellation (Maceda Law)

Buying the Property

1. Original Owner’s Duplicate Copy of the Certificate of Title

2. Certified True Copy of Tax Declaration (Classified as Non-Agricultural)
3. Copy of Current Real Property Tax Receipt
4. Original Updated Realty Tax Clearance Certificate Issued by the City Treasurer
5. Certificate of Non-Improvement Issued by the City Assessor
6. Tax Identification Number of the Seller
7. Current Community Tax Certificate or Proof of Identification

Other Requirements

1. Original SPA (if the registered owner is to be represented by the other person)
2. Original Secretary’s Certificate (sometimes better if BOD Resolution) if the seller is a corporation
3. DAR Conversion/Exemption Certificate (if Agricultural land)

Simple Flowchart

Offer to Sell from the Owner of the land  Feasibility Study of sites of the offered lots and preliminary
due diligence  Decide whether to buy  Plotting and Actual land survey  Due diligence as to the
authenticity of the ff:

 Title – Current & Trace Back – RD

 Tax Declaration – Current & Trace Back – Assessor
 Real Property Tax – City Treasurer
 Approved Plan – Bureau of Lands
 CARP Exemption/DAR Conversion – DAR

Documentation  Preparation of Legal Documents (Memorandum of Agreement, Deed of

Absolute Sale, Deed of Installment Sale)  Signing of Documents  Payment to Seller  Payment
 of Necessary Taxes (BIR & Treasurer’s Office)  Registration of Deed and transfer of Title in favor of
the buyer  Transferring of Tax Declaration in favor of the buyer

R.A. No. 6552 (MACEDA LAW)

Section 1. This Act shall be known as the “Realty Installment Buyer Act.”

 What is installment sale?

*If the case is not for installment, then they will not be considered or covered by R.A. No.
6552.
*There was an old case and it is not a sale involving real property. It is a sale of a personal
property. This decision was even before the promulgation or the passing of RA No. 6552. In
that old case, they defined a sale in installment as a sale where there is monthly
amortization. They excluded a sale of, let us say, there are 2 payments to be made. They say
it is not a sale in installment because it is a sale with a fixed term. If it is just a 2 or 3
installment or payments, they say it is a straight term. But that decision was made even
before the passing of RA No. 6552.
* In a recent case last 2019 or 2018, penned by Justice Jose Reyes, wherein he mentioned
that any sale that is payable in more than 1 payment falls under the Maceda Law. But that is
not a definitive ruling. The point of view of Justice Reyes is that if it is more than 1 payment,
then that is installment. (Royal Plains vs Mejia) Professor Villanueva, a civil law
author/professor, on the other hand, says that it is hard to define what is falling under
Maceda Law because the law is always so encompassing because of Section 2.

Section 2.  It is hereby declared a public policy to protect buyers of real estate on installment payments
against onerous and oppressive conditions.

 How do you construe R.A. No. 6552?

* Remember the mandate of the law is to protect real estate buyers and installment. For
example, in a purchase of property wherein I will pay 20% or 2M now and 8M (10M worth
property) after 30 days, if you will say that is not what is covered by Maceda Law or an
installment sale, what protection are you now offering to me? If anyone will question you if it is
an installment sale, refer to the decision of Justice Reyes on the case Royal Plains vs. Mejia.

Section 3. In all transactions or contracts involving the sale or financing of real estate on installment
payments, including residential condominium apartments but excluding industrial lots, commercial
buildings and sales to tenants under Republic Act Numbered Thirty-eight hundred forty-four, as
amended by Republic Act Numbered Sixty-three hundred eighty-nine, where the buyer has paid at least
two years of installments, the buyer is entitled to the following rights in case he defaults in the payment
of succeeding installments:

* If you are a buyer of an installment but you are buying an industrial lot, commercial lot or
buildings, and sales to tenants, this will not apply to you. This will only apply if you are
buying a piece of land for residential property: for example, a house and lot for residential
and residential condominium — covered by Maceda Law. If office space, commercial space
and a hectare of land — not covered by Maceda Law. 
 *Why is a hectare of land not included? Because it is not for residential use. If you will build
a wide and big house in this hectare of land, you need to prove that you will use that
property for residential use. But if that hectare of land is farm land, then it is not covered by
Maceda Law.
*Remedies afforded by Maceda Law are divided into two scenarios: (1) You look at the
buyer who has paid at least 2 years of installments. 2 years is not exactly equivalent to 24
monthly payments. According to the Supreme Court, 2 years is defined as follows: There is a
monthly amortization of 10K and the total payment you made is 240K. The total payment
will be divided by 10K = 24K. Therefore, you made at least 2 years of installment. It is not
enough that you pay 24 times. That is the idea of the law. Even if you paid 24 times, for
example, you paid a total of 200K in 30 months and your monthly amortization is 10K. Why
200K only? Because you do not pay in full every month or there are months that you were
not able to pay. What happens is that 200K / 10K = 20 months. You did not reach 24 months
or 2 years of installments.
*On the other side, there is also an instance wherein buyer pays in bulk or more than what
is due monthly. 1st and 2nd month: 10K. 3rd month: 100K. 4th and 5th month: 50K. 6th and
7th: reached 240K. On the 8th-9th month, there was a problem and buyer cannot pay.
Developer said buyer still did not reach 2 years of installment and only 7 months. According
to the Supreme Court, developer is wrong. Computation is 240K / 10K = 24 months. Buyer
already reached at least 2 years of installment. That is how the Supreme Court interpreted
this 2 years of installment.  It does not necessarily need to be 24 times but to the amount
divided by the monthly amortization.

a) To pay, without additional interest, the unpaid installments due within the total grace period
earned by him which is hereby fixed at the rate of one month grace period for every one year of
installment payments made: Provided, That this right shall be exercised by the buyer only once
in every five years of the life of the contract and its extensions, if any.

* We still follow 1 year = 12 equivalent of payments not 12 times. If you paid 24 monthly
payments equivalent to 2 years, you will be entitled to a 30-day grace period for every 1
year. If it is equivalent to 2 years. Therefore, 2 years = 60 days. 1st remedy if nag-default ka,
you have a 60 days grace period to update your account without any interest. 

b)  If the contract is canceled, the seller shall refund to the buyer the cash surrender value of the
payments on the property equivalent to fifty percent of the total payments made, and, after
five years of installments, an additional five per cent every year but not to exceed ninety per
cent of the total payments made: Provided, That the actual cancellation of the contract shall
take place after thirty days from receipt by the buyer of the notice of cancellation or the
demand for rescission of the contract by a notarial act and upon full payment of the cash
surrender value to the buyer.

Down payments, deposits or options on the contract shall be included in the computation of the
total number of installment payments made.
 * If you cannot pay within the 60-day period, there is a problem and you cannot pay
anymore, the Maceda Law is not excusing the buyer to pay. Maceda Law is just giving the
seller the procedure on how to cancel the sale. I will cancel if the buyer cannot pay but we
just need to observe the proper procedure. What if the procedure is not observed? Well, if
the procedure is not observed then the sale is not canceled. It is still valid and ongoing. If we
are the seller, it is required we need to cancel the sale according to this procedure.
* What is the procedure? pagka nagdefault siya, we will give 60 days grace period because
normally para magfall siya sa Section 3, nakapag 2 years na siya. So, we will give a 60 days
grace period. After 60 days, we will cancel.
* Send a notice of cancellation for rescission of the contract by notarial act.
* What is a notarial act? It is a cancellation that is duly notarized. But the Supreme Court
stated na ang ilalagay natin dun ay hindi jurant but acknowledgement. Duly notarized but
notary portion is not enough for jurant but it should be an acknowledgement. 
* Will take effect 30 days from the receipt. So in effect, before someone cancels it will
exceed 90 days and any time before the cancellation or when he/she obtains money, he/she
is allowed to pay. For example, 88 days na, 2 days na lang cancel na eh biglang nanalo sa
lotto or biglang namatay tito na mayaman so nagkapera. So pwede pa ba niya bayaran? YES
because the effectivity of the cancellation would be 30 days from sending or the receipt of
the notarial cancellation. Refund must be included if we cancel and send a notarial
cancellation.
* Refund = 50% total of the payments made. The policy of the developer is sometimes
incorrect. The interpretation of the court in 50% refund is that there will be no deduction.
For example, if I already paid 300K SMDC then I won’t be able to pay the rest and I already
fall under Section 3 — entitled for a refund (50% of the total payments made). 300K x 50% =
150K. However, some developers have different policies (deductions in expenses, broker
fees, attorney’s fee, etc.). This is incorrect because the law is clear that the refund must be
50% of the total payments made without deductions. 
* In order to cancel the account, you should observe the proper procedure of Maceda Law.
If you do not observe the proper procedure of Maceda Law, let’s say you cancel the account
without sending / observing the 60 plus 30 days grace period, it is a defective cancellation.
Without making a wrong computation on the refund, it is a defective cancellation. For
example, “Sorry Mr. Bello your account is hereby cancelled. The refund is available already
at the office at this amount Php XXXXXX.” This is a defective cancellation. WE ONLY OBSERVE
THE PROPER PROCEDURE.
* When will you obtain a refund? Kapag nagkaroon ka na ng payment at least two years of
lease installment. But for example, if hindi ka pa naka two years but nakakapaghulog for ten
times with a total of 100K only. 10K x 10 = 100K so it didn’t reach for at least 2 years of
installment. What is the remedy? You will not fall for Section 3 but you will fall under Section
4.

Section 4. In case where less than two years of installments were paid, the seller shall give the buyer a
grace period of not less than sixty days from the date the installment became due.
If the buyer fails to pay the installments due at the expiration of the grace period, the seller may cancel
the contract after thirty days from receipt by the buyer of the notice of cancellation or the demand for
rescission of the contract by a notarial act.

* Same with Section 3 but there is no refund. If you didn’t reach for 2 years of installment,
the same process of cancellation only that you’re not entitled for refund. 60 days grace
period, 30 days of effectivity of the notarial act = 90 days to pay but there is no refund. 

Section 5. Under Section 3 and 4, the buyer shall have the right to sell his rights or assign the same to
another person or to reinstate the contract by updating the account during the grace period and before
actual cancellation of the contract. The deed of sale or assignment shall be done by notarial act.

* There are developers where they put on the contract that you cannot assign your rights. Is
it valid? YES, it is valid if you will just assign your rights but not if you are exercising the right
to assign under Section 5. Pwede kong pag bawal yan pero hindi kung under Section 5. So,
you have the right to assign if you cannot pay anymore and you will get more than the 50%
refund because you can get the entire amount that you paid. 
* If hindi sinabi sayo na may refund ka, the decision making will also be a mistake. If uulitin
yung procedure, may additional 30 days ka. Why do you want an additional 30 days? Malay
mo magkaroon ka ng pera in the next 30 days in order to pay. Ang kakampi mo lang dito ay
time. Hindi mo alam kung kelan ka magkakapera kaya kung may additional kang 30 days,
you’ll grab it. 

Section 6. The buyer shall have the right to pay in advance any installment or the full unpaid balance of
the purchase price any time without interest and to have such full payment of the purchase price
annotated in the certificate of title covering the property.

Section 7. Any stipulation in any contract hereafter entered into contrary to the provisions of Sections
3, 4, 5 and 6, shall be null and void.

* Kahit nakalagay sa contract of sale “bawal mag advance, mag assign, ganito lang ang
refund mo, etc.” this is void because Maceda Law is very clear. This law is for the protection
of the buyer so you cannot stipulate anything contrary to this law.

Section 8.  If any provision of this Act is held invalid or unconstitutional, no other provision shall be
affected thereby.

Section 9. This Act shall take effect upon its approval.

Approved: August 26, 1972.

A law passed before the declaration of Martial Law. A 50-year old law and it is still a good law that
provides protection for installment buyers. Some things to remember not only you but also your friends:
(1) if there is a problem, if you cannot pay don’t accept any terms or any offer from the developer.
Check first if the offer is in accordance with Maceda Law kase yung ibang developer magaling mga yan
“ayusin na agad natin to accept the refund.” Consult first. Check what is the Maceda Law. (2) The 50%
down payment or refund is only applicable if you cannot pay. They confiscate because you cannot
already pay. Who’s at fault? YOU. If the developer is at fault, 100% refund. Some developer use this
provision para guluhin yung mga tao. 
 * For example, bumili ka ng condominium ang tagal tagal na hindi pa din nadedevelop yung
condo now hindi pa tapos so nagalit ka gusto mo mag back out and gusto mo ng refund. Ang
remedy would be full refund not 50% since it is only applicable for buyers who cannot pay
the balance.

LEASING
 Leasing is a contract
o A contract is a meeting of minds between two persons whereby one binds himself, with
respect to the other, to give something or to render some service.
 Stages
o Negotiation
o Perfection
o Consummation

Characteristics:

 Obligatoriness
o The law between the parties;
o Must be complied with in good faith

*Once agreed upon, the terms of the contract are considered the law between the
parties and must be complied with in good faith between the terms and conditions they
have agreed upon. Once the parties have already perfected the contract, they’re bound
by it. 
 Autonomy
o Free to establish stipulations;
o Stipulations must not be contrary to law, morals, pubic order, public policy, and good
customs

*Parties are free to stipulate. They can put the terms and conditions that they want
provided it is not contrary to law, moral, public order, public policy and good customs.
We must remember that if they agreed on something that is contrary to law, morals,
etc. then that agreement is considered not agreed upon and can be set aside.
 Mutuality
o Binds both parties;
o Validity and compliance cannot be left to the will of one of the parties.

*It binds both parties and the validity and compliance cannot be left to the will of one of
the parties. A contract is mutual. One party cannot just say “ayoko na” hindi pwede
yon. 
 Relativity
o Contracts take effect only between the parties, assigns, and heirs.
 *In a contract of lease, even if the contracting parties died already that contract is still
binding between the heirs / assigns of the contracting parties. 

Requisites:

 Consent
o Free, voluntary, intelligent, conscious

*A contract of lease is a consensual contract that is perfected by mere consent. The

moment parties come to an agreement, there is already a perfected contract. 
 Object
 Cause

Perfection

 Contract is perfected by mere consent

 Except Loan, Deposit, Pledge, & Donation.

Oral Contract

 Contract need not be in writing to be valid.

 Note: An agreement of the leasing for a longer period than one year must be in writing to be
ENFORCEABLE

Contract of Lease

 One of the parties (Lessor) binds himself to give another (Lessee) the enjoyment or use of a
thing for a price certain, and for a period.

*What is transferred here is the use, not the ownership. Ms. Tolentino, I remain the owner but if
I entered into a contract of lease with you involving my condominium, I acknowledge or allow
you to use the condominium for a certain price and for a certain period. Kung one year, one year
lang and you pay a rent for it. I’m (Atty. Cruz) known as the lessor and you (Ms. Tolentino) are
known as the lessee.

Characteristics:

 Consensual
 Purpose is Use
*Not transfer of ownership
 Temporary
o No lease for more than 99 years shall be valid

Obligation of the Lessor

 To deliver the thing which is the object of the contract in a condition as to render it fit for the
use intended.
 *It is not just delivering the thing, it should be fit for the use intended. Kung nagpapaupa ako ng
residential dapat yung bahay ay fit ibig sabihin free from dermites, vermin, cockroaches, etc. ibig
sabihin livable or fit for the use intended.

 To make on the same during the lease all the necessary repairs in order to keep it suitable for
the use to which it has been devoted, unless there is a stipulation to the contrary.

* If you will not stipulate who will undertake the repairs then you will be the one (lessor) who
has the burden to do the repairs. If you want the lease to do the repairs, you must stipulate.
Sasabihin mo sa contract na all the repairs will be undertaken by the lessee. But you might want
to follow my advice: I recommend that major repairs be undertaken by the lessor and minor
repairs be undertaken by the lessee.

 To maintain the lessee in the peaceful and adequate enjoyment of the lease for the entire
duration of the contract.

* It is the lessor’s obligation that the lessee will not be disturbed legally or no one would ask the
lessee to move away. If it is physically, such as noise due to karaoke, bingo, etc. nearby, then it is
the obligation of the barangay or the homeowners’ association.

Rights of Lessee

 To demand delivery of the thing leased

 To be in peaceful and adequate enjoyment of the lease for the entire duration of the contract
 To sub-lease the property unless there is a stipulation to the contrary
o Subleasing is when the lessee leases out a portion of the property to another person
 To choose between proportional reduction of rent and rescission of the lease if the thing is
partially destroyed by fortuitous event.
*For example, you are renting a house and lot. However, a part of the house, the maid’s
quarter, was burnt. What could happen is that lease can be terminated or a proportional
reduction of rent. 
 To terminate the lease if the leased dwelling place or building intended for habitation is in such
a condition that its use brings imminent and serious danger to his life or health or uninhabitable.
*For example, you lease near an active volcano in the danger zone. You could terminate
the lease
 To ask the proportional reduction of the rent if the urgent repairs being made by the lessor will
last for more than 40 days.
*For example, a house with 4 quadrants - bedroom, dining, kitchen, and sala. If sala or
living room needs repair and repair took for more than 40 days, you have the right to
reduction on rent corresponding to the area you were not able to use. If, for instance,
each quadrant costs 10k and the repair is 60 days, you are entitled not to pay 10k for 2
months or 20k.
Obligation of the Lessee

 To pay for the price of the lease according to the terms stipulated;
 To use the thing leased as a diligent father of a family devoting it to the use stipulated and in the
absence of stipulation, to that which may be inferred from the nature of the thing leased,
according to the custom of the place;
*There was this client (lessee) who used a house she rented to manufacture herbal tea,
etc. Lessee said there was no agreement that it should be used solely for residential
purposes. Owner got mad and violent and also asked the lessee to move away. The
owner should have given the lessee the opportunity to correct. Both of them are at
fault. If it is residential, then it should be residential and similar with commercial.
 To pay expenses of the deed of lease;
 To notify the owner of the need for urgent repairs;
 To tolerate the works of the lessor for urgent repairs;
 To notify the lessors for usurpation of third persons;
 To return the thing leased at the termination of the lease just as he received it except for
ordinary wear and tear;
*Take note: If you are the lessor, how do you want the thing to be returned? In the
original condition or after improvements are introduced? It depends in the situation. In
SM, if you rent a space, for instance Penshoppe or Bench, you make improvements in
accordance with the design of the store. If lease is done, SM will ask you to remove such
improvements and make it a bare unit. You might want to stipulate at that.
 To be liable for loss or deterioration due to his own fault or negligence; and
 To be liable for any deterioration caused by the members of his household and by guests and
visitors.

Rentals

 When and Where: If nothing has been stipulated, then the custom of the place shall be
followed.
 Reduction: cannot be changed; unless stipulated

*Sometimes, we ask for advanced rentals. For example, 2 months advance, 2 months deposit. The 2
months advance is an advanced rental that is different from deposit, because the 2 months deposit
will shoulder the damages that may be caused by the lessee. 2 months deposit will be returned after
2 months (normally) or 1 month that the contract has expired. Unpaid utilities will be checked first.

*Suggestion: Atty. Rex requires the lessee to show proof of payment for utilities from time to time.
Why? Because if the lessee moves away, the lessor is liable for the payment of the utilities. Deposit
may not be enough. But that is what the deposit is for. It will not be used for rentals.

*The 2-month advance reassures payment of rental. For example, in a year, the advance payment
will be applied to November and December, not February and March. If lessee asks for advanced
payment to be applied in February, you can allow that and ask lessee to pay for February rental
payment along with March rental payment. If the lessee still can’t pay in March, it is allowed that
you only give the lessee until March 15 to pay and if not, you may ask the lessee to vacate.
Assignment

 The lessee cannot assign the lease without the consent of the lessor, unless there is a
stipulation to the contrary.

*Lease is very personal. Lease vs Sale: For example, there is a condo that you are selling and
there is a prospective buyer who looks like an addict. Will you still sell the property? Yes,
because the ideal is someone who can pay. You will transfer possession and ownership to
the buyer. (Sale) If the property is for rent, of course you wouldn’t want an addict living
there. If I lease it to you, there is a factor that I evaluate you. You cannot therefore assign
your right to another person without my consent.  (Lease)

Sublease

 A lessee can sublease the property in whole or in part that he is leasing if there is no express
prohibition in the contract.

*Any action of the sublessee, the lessee will be responsible.

Renewal [May be renewed upon mutual consent]

 Option to Renew – a stipulation in the contract of lease that gives the lessee the sole option
to renew the lease is valid and binding on the parties
 Where the renewal of the original lease is subject to the terms and conditions as may be
agreed upon the parties, the renewal is not automatic.

Implied New Lease

 The term of the original contract of lease has expired.

 The lessor has not given the lessee a notice to vacate.
 The lessee continued enjoying the thing leased for 15 days with acquiescence of the lessor.

* There is one express lease. For example, they signed a lease of contract in 2000. Afterwards, they
did not execute a renewal although there were no problems in rental payments. From 2001 to 2015,
the lease is implied new lease. 

Effect of Implied Lease

 The period of lease for rural land: All the time necessary for the gathering of the fruits which the
whole estate lease may yield in one year, or which it may yield once, although two or more
years have to elapse for the purpose.

*For example, you have a tenant and you have a 1 year contract. After a year, di na kayo
nagpirmahan. You can’t let him leave until he harvest.
 The periods of lease for urban land:
o Year to year, if the rent agreed upon is annual
o Month to month
 o Week to week
o Day to day

* For example, the contract expired on December 31 but the tenant stayed in January and
paid. The tenant can stay until the end of January. Same with February, then the tenant has
until the end of February. Before the end of February, you want him to leave. It is not
allowed because implied lease is month to month since the payment is monthly.

Remedies of Lessor [Right to Reject]

 When the period agreed upon has expired

 Lack of payment of rentals
 Violations of any conditions in the contract
 When the lessee devotes the thing leased to any use or service not stipulated

* Except for number 1, you should give them the opportunity to correct.

Improvements

 Useful
o Lessor has the option to pay the lessee ½ of the value of the improvements at the time
of expiration of contract
o Allow removal

*If you don’t want to reimburse, you may allow the removal. For example, a house with 1
car garage or covered parking is for rent. However, you observed that 2 or 3 cars fit. You
could park other cars but they are not covered. You know that when a car is exposed to
elements, it is prone to damage. Lessee introduced improvements and put an extension to
the garage. Now, when the lease ends, the lessor has the option to pay the lessee ½ of the
value of the improvements at the time of expiration of contract. It is already a depreciated
value. If you are not going to reimburse the lessee, the lessee has the right to remove it.

*Suggestion: Put in the contract that “no improvements can be introduced without the
consent of the lessor.”

 Ornamental
o Not entitled to reimbursement
o May remove; provided no damage is caused to the principal thing
o Lessor may choose to retain by paying 100%

*For example: statues, fountains, etc.

Rent Control Act

 Rent Control Act extended for another 2 years

 The housing and Urban Development Coordinating Council (HUDCC) has extended the rent
control regulation for residential units occupied by low-income brackets for another two years
until December 2017.
  Effective January 1, 2016 until December 31, 2017, the rent of any residential unit for those
paying monthly rent of up to P3,999.00 shall not increase by more than 4% per annum. On the
other hand, monthly rentals of P4,000 up to P10,000 shall not be increased by more than 7% per
annum provided that the unit is occupied by the same lessee. This regulation applies to all
residential units covered by the specified monthly rent, across the country.

DONATION
 It is an act of liberality whereby a person disposes gratuitously of a thing or right in favor of
another who accepts it (Art. 725).

Requisites:

1. Donor must have the CAPACITY to make the donation at the time of the perfection of the
contract.
2. He must have DONATIVE INTENT (animum donandi).
3. There must be DELIVERY.
4. Done must ACCEPT or consent to the donation.

In certain donations, the form prescribed by law must be followed (Art. 758 & 749).

Features/Elements of a True Donation

INTER VIVOS

1. Alienation of property by the donor during the lifetime, which is accepted.

2. Irrevocability (except for legal cause)
3. Animus Donandi (intent to Benefit the done)
4. Resultant decrease in the assets or patrimony of the donor

Perfection of Donation

 The donation is perfected from the moment the donor knows of the acceptance by the done.

NOTE:

 Acceptance must be made during the lifetime of the donor and the donee.

1. In case of donation inter vivos, acceptance takes effect during the lifetime of the donor and
the donee.
2. In case of donation mortis causa, acceptance is only made after the donor’s death because
they partake of the nature of a will and thus governed by the rules on succession (Art. 728).

Perfection

 Acceptance is indispensable because nobody is obliged to receive a benefit against his will. Its
absence makes the donation null and void.
 Prior to learning of the acceptance, there is as yet no perfected donation, in which case, the
donor may give the property to someone else.
  Once a valid donation is perfected, it cannot be revoked without the consent of the donee
except on the grounds provided by law such as inofficiousness, failure of the donee to comply
with the charges imposed in the donation or by reason of ingratitude.

Acceptance May Be In

1. Same Instrument in which case there is already knowledge of the acceptance, hence, the
donation is already perfected.
2. Separate instrument.

Classification

1. As to effectivity:
a. Inter vivos
b. Mortis causa
c. Propter nuptias – made by reason of marriage and before its celebration, in
consideration of the same and in favor of one or both of future spouses.
2. As to perfection/extinguishment
a. Pure
b. Conditional
c. With a term
3. As to consideration
a. Simple – the cause of which is the pure liberality of the donor in consideration of the
donee’s merits.
b. Remuneratory or Compensatory – that which is given out of gratitude on account of the
services rendered by the donee to the donor, provided they do not constitute a
demandable debt.
c. Modal or Conditional – imposes upon the donee a burden which is less than the value of
the thing donated.
d. Onerous – imposes upon the donee a reciprocal obligation or, to be more precise, this is
the kinds of donation made for valuable consideration, the cost of which is equal to or
more than the thing donated.

NOTE:

 Illegal or impossible conditions in simple and remuneratory donation shall be considered as not
imposed (Art. 727). Only such conditions are disregarded, but the donation itself remains valid.
 Donation with onerous cause are governed not by the law on donations but by the rules on
contracts. Hence, on the matter of prescription of actions for revocation of onerous donation, it
was held that the general rule on prescription applies.
 A stipulation in the donations that it was made for and in consideration of the “love and
affection which the donee inspires in the donor, and as an act of liberality and generosity” is
sufficient cause for a donation.

Donation Mortis Causa Governed by rules on succession

  Donation which are to take effect upon the death of the donor partakes of the nature of
testamentary provisions and shall be governed by the rules established in the Title on
Succession.
 The title given to a Deed of Donation is not the determinative factor which makes the donation
“inter vivos” or “mortis causa.” Whether a donation is inter vivos or mortis causa depend upon
the nature of the disposition made.

Inter Vivos Mortis Causa

As to the time of taking effect
As to the intention of making
donations
As to its validity
As to its revocability
As to its legal formalities
As to the date of its acceptance
As to the date of its acceptance
Takes effect independently of Takes effect only upon the death
the donor’s death of the donor
Made out of the donor’s pure Made in contemplation of his
generosity death without the intention to
lose the thing or its free disposal
in case of survival
Valid if the donor survives the Void if the donor survives the
donee donee
Generally irrevocable during the Always revocable at any time
donor’s lifetime except for and for any reason before the
grounds provided by law. The donor’s death.
express irrevocability of the
donation is the “distinctive
standard that identifies the
document as a donation inter
vivos.” Here, the donors plainly
said that it is “our will that this
Donation Mortis Causa shall be
irrevocable and shall be
respected by the surviving
spouse.” The intent to make
donation irrevocable becomes
even clearer by the proviso that
a surviving donor shall respect
the irrevocability of the
donation. Consequently, the
donation was in reality a
donation inter vivos.
Must comply with the formalities Must comply with the formalities
required by Arts. 748 and 749 of required by law for the
the Code execution of wills
Must be accepted by the donee Can only be accepted after the
during his lifetime donor’s death
Subject to donor’s tax Subject to estate tax