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TABLE OF CONTENTS: CIVIL LAW: PART I

I. PRELIMINARY TITLE ................................................................................................................................... 9

A. EFFECT AND APPLICATION OF LAWS ............................................................................................ 9

B. HUMAN RELATIONS ........................................................................................................................ 12

II. PERSONS AND FAMILY RELATIONS...................................................................................................... 13

A. PERSONS .......................................................................................................................................... 13
B. MARRIAGE ........................................................................................................................................ 15
C. LEGAL SEPARATION ....................................................................................................................... 20
D. RIGHTS AND OBLIGATIONS BETWEEN HUSBAND AND WIFE .................................................. 21
E. PROPERTY RELATIONS BETWEEN HUSBAND AND WIFE ......................................................... 21
F. FAMILY HOME .................................................................................................................................. 24
G. PATERNITY AND FILIATION ............................................................................................................ 24
H. ADOPTION ......................................................................................................................................... 25
I. SUPPORT .......................................................................................................................................... 27
J. PARENTAL AUTHORITY .................................................................................................................. 28
K. EMANCIPATION ................................................................................................................................ 29
L. RETROACTIVITY OF FAMILY CODE ............................................................................................... 29

III. SUCCESSION ........................................................................................................................................... 29

A. GENERAL PROVISIONS ................................................................................................................... 29

B. TESTAMENTARY SUCCESSION / WILLS ....................................................................................... 30
C. LEGAL OR INTESTATE SUCCESSION ........................................................................................... 43
D. PROVISIONS COMMON TO TESTATE AND INTESTATE SUCCESSION ...................................... 47

IV. OBLIGATIONS AND CONTRACTS ......................................................................................................... 49

A. OBLIGATIONS ................................................................................................................................... 49
B. CONTRACTS ..................................................................................................................................... 58
C. NATURAL OBLIGATIONS ................................................................................................................ 64
D. ESTOPPEL ........................................................................................................................................ 64
E. TRUSTS ............................................................................................................................................. 65
F. QUASI-CONTRACTS ........................................................................................................................ 66

V. SALES ........................................................................................................................................................ 67

A. NATURE AND FORM ........................................................................................................................ 67

B. CAPACITY TO BUY OR SELL .......................................................................................................... 70
C. EFFECTS OF THE CONTRACT WHEN THE THING SOLD HAS BEEN LOST .............................. 71
D. OBLIGATIONS OF VENDOR ............................................................................................................ 71
E. OBLIGATIONS OF VENDEE ............................................................................................................. 73
F. BREACH OF CONTRACT ................................................................................................................. 74
G. EXTINGUISHMENT ........................................................................................................................... 76
H. ASSIGNMENT OF CREDITS ............................................................................................................. 78

VI. LEASE ....................................................................................................................................................... 82

A. GENERAL PROVISIONS................................................................................................................... 82

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B. RIGHTS AND OBLIGATIONS OF THE LESSOR AND OF THE LESSEE ....................................... 82

VII. PARTNERSHIPS...................................................................................................................................... 83

A. GENERAL PROVISIONS................................................................................................................... 83
B. OBLIGATIONS OF THE PARTNERS................................................................................................ 86
C. DISSOLUTION AND WINDING UP ................................................................................................... 87
D. LIMITED PARTNERSHIP .................................................................................................................. 87

VIII. AGENCY ................................................................................................................................................. 87

A. DEFINITION OF AGENCY ................................................................................................................. 87

B. NATURE, FORMS, AND KINDS OF AGENCY ................................................................................. 88
C. OBLIGATIONS OF THE AGENT ....................................................................................................... 89
D. OBLIGATIONS OF THE PRINCIPAL ................................................................................................ 92
E. MODES OF EXTINGUISHMENT ....................................................................................................... 92

IX. CREDIT TRANSACTIONS ........................................................................................................................ 94

A. LOAN ................................................................................................................................................. 94
B. DEPOSIT ............................................................................................................................................ 97
C. GUARANTY AND SURETYSHIP .................................................................................................... 101
D. QUASI-CONTRACTS ...................................................................................................................... 106

X. TORTS AND DAMAGES ......................................................................................................................... 106

A. TORTS ............................................................................................................................................. 106

B. PROXIMATE CAUSE ....................................................................................................................... 110
C. NEGLIGENCE .................................................................................................................................. 110
D. DAMAGES ....................................................................................................................................... 111

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TABLE OF CONTENTS: CIVIL LAW: PART II

I. PROPERTY ............................................................................................................................................... 115

A. CLASSIFICATION OF PROPERTY................................................................................................. 115

B. OWNERSHIP ................................................................................................................................... 115
C. CO-OWNERSHIP ............................................................................................................................. 126
D. POSSESSION .................................................................................................................................. 128
E. USUFRUCT ...................................................................................................................................... 132
F. EASEMENTS ................................................................................................................................... 133
G. NUISANCE ....................................................................................................................................... 136
H. MODES OF ACQUIRING OWNERSHIP .......................................................................................... 138
I. QUIETING OF TITLE ....................................................................................................................... 145
J. ACTIONS TO RECOVER PROPERTY ............................................................................................ 146

II. CREDIT TRANSACTIONS ....................................................................................................................... 147

A. PERSONAL PROPERTY SECURITIES ACT (R.A. 11057) ............................................................ 147

B. REAL ESTATE MORTGAGE .......................................................................................................... 157

III. LAND TITLES & DEEDS ......................................................................................................................... 162

A. TORRENS SYSTEM; GENERAL PRINCIPLES .............................................................................. 162

B. REGALIAN DOCTRINE ................................................................................................................... 163
C. ORIGINAL REGISTRATION ............................................................................................................ 163
D. CETRIFICATE OF TITLE ................................................................................................................. 167
E. SUBSEQUENT REGISTRATION .................................................................................................... 168
F. NON-REGISTRABLE PROPERTIES .............................................................................................. 171
G. DEALINGS WITH UNREGISTERED LANDS .................................................................................. 171
H. ASSURANCE FUND ........................................................................................................................ 171
I. CADASTRAL SYSTEM OF REGISTRATION (Act No. 2259, as amended) ................................. 172
J. REGISTRATION THROUGH ADMINISTRATIVE PROCEEDINGS (C.A. 141, as amended) ........ 173
K. RECONSTITUTION OF TITLES ...................................................................................................... 176

IV. PRACTICAL EXERCISES ...................................................................................................................... 177

A. DEMAND AND AUTHORIZATION LETTERS ................................................................................. 177

B. SIMPLE CONTRACTS ..................................................................................................................... 182
C. COMPLAINT .................................................................................................................................... 189
D. JUDICIAL AFFIDAVIT ..................................................................................................................... 191
E. WILLS .............................................................................................................................................. 193

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TABLE OF CONTENTS: CIVIL LAW: PART I

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I. PRELIMINARY TITLE
A. EFFECT AND APPLICATION OF
LAWS
Q: What is the effect if a repealing law is itself
repealed?
A: When a law which expressly repeals a prior law is
itself repealed, the law first repealed shall not be
revived, unless expressly so provided. (1 Paras, Civil
Code of the Philippines Annotated (2016), p. 49
[hereinafter 1 Paras])
When a law which impliedly repeals a prior law is
itself repealed, the prior law shall be revived unless
the language of the repealing statute provides
otherwise. (U.S. v. Soliman, G.R. No. L-11555, 1917)
Q: What is the rule on the prospectivity of laws?
A: The general rule is that laws shall only be given
prospective application, except:
1. When the law expressly provides for its
retroactivity (Art. 4, NCC), provided no vested
rights are impaired (Art. 256);
2. When the law is curative;
3. When the law is procedural;
4. When it is a penal law favorable to the
accused, as long as he is not a habitual
delinquent or the penal law does not provide
for its non-retroactivity;
5. When substantive rights are declared for the
first time; and
6. In the case of laws of an emergency nature
enacted pursuant to police power. (Co v. CA,
G.R. No. 100776, 1993, citing 1 Paras (1984))
Q: What is the doctrine of “processual
presumption?”
A: The doctrine provides that where a foreign law is
not pleaded, or even if pleaded is not proved, the
presumption is that foreign law is the same as ours.
(EDI-Staffbuilders International v. NLRC, G.R.
145587, 2007)
Q: What is the doctrine of forum non
conveniens?
A: The doctrine provides that a court, in conflicts of
law cases, may refuse impositions on its jurisdiction
where it is not the most “convenient” or available
forum and the parties are not precluded from seeking
remedies elsewhere. (Bank of America v. Court of
Appeals, G.R. No. 120135, 2003)
Q: Under the doctrine of forum non conveniens,
when may a Philippine court or agency choose to
assume jurisdiction?
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1. Philippine court is one to which the parties
may conveniently resort to;
2. Philippine court is in a position to make an
intelligent decision as to the law and the facts;
and
3. Philippine court has or is likely to have power
to enforce its decision. (The Manila Hotel
Corporation v. NLRC, G.R. No. 120077, 2000)
Q: How is divorce acquired in a foreign country
proven in the PH courts for judicial recognition?
A: In order for a divorce obtained abroad to be
recognized in our jurisdiction, it must be shown that
the divorce decree is valid according to the national
law of the foreigner. Both the divorce decree and the
governing personal law of the alien spouse must be
proven. Our courts do not take judicial notice of
foreign laws and judgment. Our law on evidence
requires that both the divorce decree and the national
law of the alien must be alleged and proven like any
other fact. (Koike v. Koike, G.R. No. 215723, 2016)
Q: L, a Filipino and R, a Japanese citizen, were
married in in the Philippines in 2009. They lived
together in Japan. During their married life, they
would constantly quarrel due to R’s philandering
ways. As such, L and R submitted a “Divorce by
Agreement” before the city hall in Nagoya City,
Japan in 2012. Can the divorce be recognized
under Philippine Law?
A: Yes, the divorce can be recognized under
Philippine Law. If granted, the fact that the divorce
was granted by a City Hall and not through a decree
issued by a court in the foreign jurisdiction is
immaterial. While usual jurisprudence provides that a
Divorce Decree must be presented in order for a
divorce acquired in a foreign jurisdiction to be
recognized under Philippine jurisdiction, in this case,
there can be no divorce decree to speak of because
a “Divorce by Agreement” is not coursed through and
granted by Japanese Courts. In any event, a “Divorce
Report” issued by the City Hall in Nagoya City, Japan
in granting a “Divorce by Agreement” is deemed an
“act of an official body” in Japan which is considered
by our courts as an equivalent of a “Divorce Decree”
in Japan. Hence, it is the best evidence of the fact of
divorce which is to be presented in order for the
divorce obtained in a foreign jurisdiction to be
recognized under Philippine Law. (In re: Petition for
judicial recognition of divorce between Minuro
Takahashi and Juliet Rendora Moraña Vs. Republic
of the Philippines, G.R. No. 227605, 2019)
Q: A Turkish citizen wrote a last will, which
provides that his property should be disposed of
pursuant to Philippine laws. Is the provision
valid?
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A: No, the provision is illegal and void because,
pursuant to what is now Article 16 of the Civil Code,
the national law of the deceased should govern.
Hence, Turkish laws should apply. (Miciano v. Brimo,
G.R. No. L-22595, 1927)
Q: A foreigner married to a Filipina had a child.
When they divorced abroad, the foreigner
refused to support the child stating that under his
country’s law, they are not obliged to support a
child. Is the foreigner’s refusal valid?
A: No. While the provisions of the Family Code on
support only apply to Filipino citizens, the foreigner in
this case did not prove his country’s law before the
courts. Thus, the doctrine of processual presumption
applies, that is - if the foreign law involved is not
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properly pleaded and proved, our courts will presume
that the foreign law is the same as our local or
domestic or internal law.
Moreover, the foreigner’s national law would not find
applicability in our jurisdiction when such is contrary
to an established public policy of the forum.
Prohibitive laws concerning persons, their acts or
property, and those which have for their object public
order, public policy and good customs shall not be
rendered ineffective by laws or judgments
promulgated, or by determinations or conventions
agreed upon in a foreign country. (Del Socorro, v.
Van Wilsem, G.R. No. 193707, 2014 citing Bank of
America v. American Realty Corp., G.R. No. 133876,
1999)
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SUMMARY OF PROVISIONS ON CONFLICTS OF LAW

LAW MATTERS/ GOVERNING PRINCIPLE/ DOCTRINE
PERSONS BOUND
Penal Laws All those who live or Principle of Territoriality: Law of the place where crime
sojourn in Philippine was committed (Art. 14, CC).
territory
Exceptions:
1) Principles of Public International Law
2) Treaty Stipulations
Status Laws Citizens of the Philippines, Principle of Nationality: National law of the person, with
including those living respect to –
abroad 1) Family rights and duties;
2) Status;
3) Condition; and
4) Legal capacity (Art. 15, CC).

Property Laws Real and personal property Lex situs or Lex rei sitae: Law of the place where the
property is situated (Art. 16, CC)

Exception: In intestate and testamentary succession,

it is the national law of the person whose succession
is under consideration, regardless of the nature and
location of the property, in particular:

1) Capacity to succeed (Art. 1039, CC);

2) Intrinsic validity of testamentary provisions;
3) Amount of successional rights; and
4) Order of succession.

Laws Relating to Forms and solemnities of Lex loci celebrationis: Law of the country in which they
Forms and contracts, wills, public are executed (Art. 17, CC)
Solemnities instruments
Exception: If executed before Philippine diplomatic or
consular officials abroad, Philippine laws shall govern.

Note: Prohibitive laws which have for their object public

order, public policy and good customs shall not be
rendered ineffective by laws or judgments promulgated,
or by determination or conventions agreed upon in a
foreign country.

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B. HUMAN RELATIONS
Q: What are the standards to observe in the
exercise of one’s rights and performance of
duty?
A: The following are the standards
1. Act with justice
2. Give everyone his due
3. Observe honesty and good faith. (Art. 19,
CC).
Q: What are the requisites for abuse of rights (Art.
19, CC)?
A: The following are the requisites:
1. There is a legal right or duty
2. Which is exercised in bad faith
3. For the sole intent of prejudicing or injuring
another.
Q: What are the requisites for Acts Contra Bonos
Mores? (Art. 21, CC)
A: The following are the requisites:
1. There is an act which is legal;
2. Said act is contrary to morals, good
customs, public order, or public policy; and
3. It is done with intent to injure.
Q: P was employed as an SA Bookkeeper of a
bank since 1977. In 2007, he suffered a mild
stroke due to hypertension which subsequently
impaired his ability to effectively pursue his work.
He wrote a letter to his employer expressing his
intention to avail of an early retirement package.
He was only 55 years old at this time. His request
remained unheeded. He was separated from
employment in the latter part of 2007 due to his
poor and failing health. Can the abuse of right
doctrine under Art. 21 apply in this case?
A: No. The elements of abuse of right are as follows:
1) there is a legal right or duty; 2) which is
exercised in bad faith; and, 3) for the sole intent of
prejudicing or injuring another. All elements were not
present in this case. Since he was only 55 at the time
of his retirement, he fell short with respect to the 60
year age requirement to be entitled to the retirement
benefits. Hence, there is no right or duty on the part
of the employer to grant his request. The employer’s
denial has basis and was not exercised in bad faith.
Neither was the intent of the employer to prejudice or
injure P present in this case. (Padillo v. Oropeza,
G.R. No. 199338, 2013)
Q: Is Article 19 of the Civil Code a basis for a
cause of action?
A: No. While Article 19 lays down a rule of conduct
governing human relations, it does not, by itself,
provide the basis for an actionable tort. Article 19
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describes the degree of care required so that an
actionable tort may arise when it is alleged together
with Article 20 or 21 so that a cause of action for the
recovery of damages may be sufficiently established.
(St. Martin Polyclinic, Inc. v. LWV Construction Corp.,
G.R. No. 217426, 2017)
Q: Distinguish the cause of action based on
Article 20 from that based on Article 21.
A: Article 20 concerns willful or negligent violations
of law as basis for an injury. “Willful” refers to the
intention to do the act and the desire to achieve the
injurious outcome. “Negligence” refers to a situation
where the act was consciously done but without
intending the injurious result.
On the other hand, Article 21 concerns injuries that
are caused by willful acts that do not violate any law,
but are nevertheless contrary to morals, good
customs, or public policy (or acts contra bonus
mores). (Id.)
Q: Is a breach of promise to marry actionable?
A: General Rule: A breach of promise to marry is not
actionable.
Exception: When one party has already made real
efforts to prepare and spend for the wedding. Such
act is unjustifiably contrary to good customs for which
the defendant must be held answerable for damages
in accordance with Art. 21 of the Civil Code.
(Wassmer v. Velez, G.R. No. L-20089, 1964)
Q: What are the 2 requisites for the Principle of
Unjust Enrichment to apply?
A: The two requisites are:
1. That a person is benefited without a valid basis
or justification, and
2. That such benefit is derived at the expense of
another (Art. 22, CC).
Q: W, a Dutch national, and A, a Filipina, are
married. After several years, the Court declared
the nullity of their marriage on the basis of the
former’s psychological incapacity. During the
dissolution of their conjugal properties, A
received the parcels of land they bought during
marriage and these lands were considered as
paraphernal property of A.
W claimed reimbursement for the purchase price
of the said parcels of land, but was denied. W
raised unjust enrichment for not being
reimbursed for money spent on purchase of
Philippine land. Can unjust enrichment be
invoked?
A: No, the provision of unjust enrichment does not
apply if the action is proscribed by the Constitution.
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An action of recovery of what has been paid without
just cause will not prosper if the action is proscribed
by the Constitution or by the application of the pari
delicto doctrine. Nor would the denial of his claim
amount to an injustice based on his foreign
citizenship. The purpose of the prohibition is to
conserve the national patrimony which the court is
duty-bound to protect. (Beumer v. Amores, G.R.
195670, 2012)
Q: Can the phrase "prying into the privacy of
another’s residence" under Art. 26 of the Civil
Code be invoked against surveillance of
business office that is located within the same
premises of a person’s residence?
A: Yes, this provision includes "any act of intrusion
into, peeping or peering inquisitively into the
residence of another without the consent of the
latter." It may extend to places where he has the right
to exclude the public or deny them access. The
phrase "prying into the privacy of another’s
residence," therefore, covers places, locations, or
even situations which an individual considers as
private. (Spouses Hing v. Choachuy, Sr., G.R. No.
179736, 2013)
Q: Does Article 28 of the Civil Code prohibit
competition with regard to enterprises?
A: No. What is being sought to be prevented is not
competition per se but the use of unjust, oppressive
or highhanded methods which may deprive others of
a fair chance to engage in business or earn a living.
Plainly, what the law prohibits is unfair competition
and not competition where the means used are fair
and legitimate. (Willaware Products Corp. v. Jesichris
Manufacturing Corp., G.R. No. 195549, 2014)
Q: Hotel officials suspected union officers of
selling marijuana in the union office inside the
hotel building. Hotel officials, without a warrant,
barged into and searched the union office, where
they found marijuana. The union officers sought
an award of damages against the hotel and its VP,
who argued that the protection against illegal
searches and seizures is not meant to be invoked
against private individuals. Are the defendants
correct?
A: No. Private persons may be held liable for
violating another person’s civil and political rights on
the basis of Article 32 which states that “[a]ny public
officer or employee, or any private individual, who
directly or indirectly obstructs, defeats, violates or in
any manner impedes or impairs any of the following
rights and liberties of another person shall be liable
to the latter for damages.” Thus, damages may be
awarded against the hotel and its VP for violating the
union officers’ right against unreasonable searches
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and seizures. (Silahis v. Soluta, G.R. No. 163087,
2006)
II. PERSONS AND FAMILY RELATIONS
A. PERSONS
1. CIVIL PERSONALITY
Q: When does personality begin?
A: Personality is determined by birth; extinguished by
death but commences from conception. (P.D. 603,
amending Art. 40, CC)
The conceived child shall be considered born for all
purposes favorable to it (provisional personality),
provided it be born later under the following
conditions:
● If it had an intra-uterine life of 7 months or more,
it is alive at the time it is completely delivered
from the mother’s womb
● If it has an intra-uterine life of less than 7
months, only if it lives for at least 24 hours after
its complete delivery from the maternal womb
(Civil Code, Art. 41)
Q: Who are juridical persons (Civil Code, Art. 44)?
1. The State and its political subdivisions
2. Other corporations, institutions, and entities for
public interest or purpose created by law
3. Corporations, partnerships, and associations for
private interest or purpose
Q: What laws govern Juridical Persons? (Civil
Code, Art. 45):
1. The State, its political subdivisions, and
corporations, institutions, and entities for
public interest or purpose: governed by the
laws creating or recognizing them.
2. Private corporations: governed by the Revised
Corp. Code (R.A. 11232)
3. Partnerships and associations: governed by
the provisions of the New Civil Code on
partnerships, except those registered with the
SEC which should be governed like corporations
Q: What are the rights of a Juridical Person?
(Civil Code, Art. 46)
1. Acquire and possess property of all kinds
2. Incur obligations
3. Bring civil or criminal actions
Q: What are the differences between Juridical
Capacity and Capacity to Act? (Civil Code, Art.
37)
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JURIDICAL CAPACITY TO ACT Q: May an illegitimate child use the surname of

CAPACITY
the father?
A: Yes. Illegitimate children may use the surname of
Fitness to be the Power to do acts with their father if their filiation has been expressly
subject of legal legal effect recognized by their father through the record of birth
relations appearing in the civil register, or when an admission
in a public document or private handwritten
Passive Active instrument is made by the father. Art. 176, Family
Code)
Inherent Not inherent; attained or
conferred
3. ENTRIES IN THE CIVIL
Lost only through Lost through death and
REGISTRY AND CLERICAL
death other causes ERROR LAW

Can exist without Cannot exist without
capacity to act juridical capacity
Cannot be limited or Can be restricted,
restricted modified, or limited
Q: What can be corrected under R.A. 9048?
A: Only clerical or typographical errors and change
of first name or nickname which can be corrected or
changed by the concerned city or municipal civil
registrar or consul general

Q: What are the grounds for change of first name

Q: What are the restrictions on Capacity to Act? or nickname?
(MInD-ICIP) a. The petitioner finds the first name or
1. Minority nickname to be ridiculous, tainted with
2. Insanity dishonor or extremely difficult to write or
3. State of being Deaf-mute pronounce.
4. Imbecility b. The new first name or nickname has been
5. Civil Interdiction habitually and continuously used by the
6. Prodigality - state of squandering money or petitioner and he has been publicly known by
property with a morbid desire to prejudice the that by that first name or nickname in the
heirs of a person (Martinez v. Martinez, G.R. No. community: or
445, 1902) c. The change will avoid confusion.

NOTE: But these do not exempt the incapacitated 4. ABSENCE

person from certain obligations.
a. Civil Code Provisions
Q: What circumstances modify or limit Capacity
to Act? (FAT-DA-PAPIII) Q: When can absence be declared?
1. Family relations 1. Two (2) years having elapsed without any news
2. Alienage about the absentee, or since the receipt of the
3. Trusteeship last news, and
4. State of being Deaf-mute 2. Five (5) years in case the absentee has left a
5. Age person in charge of the administration of his
6. Penalty property (Art. 384, NCC)
7. Absence
8. Prodigality Q: Who may ask for a declaration of absence?
9. Insanity a. The spouse present
10. Insolvency b. The heirs instituted in a will, who may
11. Imbecility (Civil Code, Art. 39) present an authentic copy of the same;
c. The relatives who may succeed by the law
2. USE OF SURNAMES of intestacy;
d. Those who may have over the property of
Q: May a child conceived before the decree the absentee some right subordinated to the
annulling a voidable marriage use the surname of condition of his death. (Art. 385, NCC)
the father?
A: Yes. (Art. 369, New Civil Code)

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b. Presumptive Death of Absent
Spouse under the Family Code
Q: What are the essential requisites for the
declaration of presumptive death under Art. 41?
(MR-BF)
1. That the absent spouse has been Missing for
four consecutive years, or two consecutive years
if the disappearance occurred where there is
danger of death under the circumstances laid
down in Article 391 of the Civil Code;
2. That the present spouse wishes to Remarry;
3. That the present spouse has a well-founded
Belief that the absentee is dead; and
4. That the present spouse Files a summary
proceeding for the declaration of presumptive
death of the absentee. (Republic vs Sareñogon,
G.R. No. 199194, 2016 (citing Republic v.
Cantor, G.R. No. 184621, 2013).
Q: X and Y were married. Y, a member of the AFP,
left X and went to Sulu where he was assigned.
Since then, X heard no news from Y. After 33
years without communication and trying
everything to locate him such as asking his
parents, relatives, and neighbors about his
whereabouts, and with the firm belief that he is
already dead, X filed a petition to declare him
presumptively dead for purposes of remarriage.
RTC and CA granted the petition ruling that X
exerted efforts to find Y. The lapse of 33 years
coupled with the fact that Y was sent on a combat
mission to Jolo, Sulu gave rise to X’s well-
founded belief that Y was dead. Is the CA
correct?
A: No. There are 4 requisites for the absent spouse
to be declared presumptively dead under Art. 41; (1)
absent spouse missing for 4 consecutive years or 2
consecutive years if the disappearance occurred
where there is danger of death under circumstances
in Art. 391 of CC, (2) that the present spouse wishes
to remarry, (3) that present spouse has a well-
founded belief that absentee is dead, and (4) present
spouse filed a summary proceeding for the
declaration of presumptive death of absentee. Under
the third requisite, the present spouse has to prove
that his/her belief was the result of diligent and
reasonable efforts to locate the absent spouse. X’s
efforts do not suffice. This is because she could have
called AFP headquarters to request information
about her husband, but failed to do so. Therefore, X’s
efforts failed to satisfy the degree of diligence
required to create “a well-founded belief” of his death.
Also, her testimony as to her efforts were not
corroborated by any additional witness nor were the
resource persons named. (Republic v. Tampus, G.R.
No. 214243, 2016.)
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CIVIL LAW (AND PRACTICAL EXERCISES)
REMEMBER: In Republic v. Cantor (2013), the
Court held that the present spouse engaged in a
mere "passive-search." Applying the "stringent-
standards" and degree of diligence required by
jurisprudence, the Court pointed out four acts of the
present spouse which contradict the claim of diligent
and active: 1) Did not actively look; 2) Did not report
to the police; 3) Did not present corroborating
witnesses; and 4) Did not present other corroborating
evidence (not just bare assertions).
Stated differently, to constitute a well-founded belief,
the present spouse must: 1) Actively look; 2) Report
to the police; 3) Present corroborating witnesses; 4)
Present corroborating evidence; and 5) Seek help
from the media.
Q: What is the proper remedy for a judicial
declaration of presumptive death obtained
through extrinsic fraud?
A: The proper remedy is an action to annul the
judgment. In case a judicial declaration of
presumptive death was obtained by extrinsic fraud
wherein the person declared presumptively dead has
never been absent, for the purpose of not only
terminating the subsequent marriage but also of
nullifying the effects of the declaration of presumptive
death and the subsequent marriage, mere filing of an
affidavit of reappearance would not suffice. (Santos
v. Santos, G.R. No. 187061, 2014)
Q: What are the conditions for the termination of
a subsequent marriage by reappearance of the
former spouse?
A: It is subject to the following conditions: (1) the non-
existence of a judgment annulling the previous
marriage or declaring it void ab initio; (2) recording in
the civil registry of the residence of the parties to the
subsequent marriage of the sworn statement of fact
and circumstances of reappearance; (3) due notice
to the spouses of the subsequent marriage of the fact
of reappearance; and (4) the fact of reappearance
must either be undisputed or judicially determined.
(Santos v. Santos, G.R. No. 187061, 2014)
B. MARRIAGE
1. REQUISITES OF MARRIAGE
Q: What are the essential requisites of marriage?
A: Legal capacity of the contracting parties who must
be a male and a female; and Consent freely given in
the presence of the solemnizing officer (Family Code,
Art. 2).
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Q: What are the formal requisites of marriage?
1. Authority of solemnizing officer;
2. Valid marriage License (except in cases where a
marriage license is not required);
a. Valid only for 120 days from issue in any part of
the Philippines
3. Marriage Ceremony where the contracting
parties appear before the solemnizing officer,
with their personal declaration that they take
each other as husband and wife in the presence
of not less than two witnesses of legal age
(Family Code, Art. 4).
Q: Will the irregularity in the formal requisites
affect the validity of the marriage?
A: No. An irregularity in the formal requisites (i.e.
authority of solemnizing officer, marriage license,
marriage ceremony) shall not affect the validity of the
marriage.
NOTE: The party responsible for the irregularity shall,
however, be civilly, criminally, and administratively
liable (Family Code, Art. 4).
Q: Who are authorized to solemnize a marriage?
1. Incumbent member of the Judiciary (judge –
within the court’s jurisdiction; Justices –within
Philippine territory)
2. Any Priest, rabbi, imam or the minister of any
church or religious sect
a. Registered with the civil registrar general;
b. Within limits of the written authority of the
church or sect; and
c. At least one of the contracting parties
belongs to the church or religious sect.
3. Ship Captain or airplane chief
a. At least one of the parties is in articulo
mortis;
b. Between passengers or crew members; and
c. While the ship is at sea or the plane is in
flight and also during stopover at ports of call
4. Military Commander of a unit to which a chaplain
is assigned;
a. Chaplain is absent at the time of marriage;
b. During military operations;
c. Must be one in articulo mortis; and
d. Between persons within the zone of military
operations or whether members of the
armed forces or civilians
5. Consul-general, consul, or vice-consul between
Filipino citizens abroad (Family Code, Art. 7).
Q: X and Y had a common law relationship. X
argues that they were in fact married. However,
this was assailed on the ground that X failed to
acquire a marriage license prior to the alleged
marriage. Instead of proving that a marriage
license was indeed issued to them at the time of
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CIVIL LAW (AND PRACTICAL EXERCISES)
their marriage, X relied mainly on the
presumption of validity of marriage. X admitted
that he applied for a marriage license, but is
uncertain about the documents submitted to the
Municipal Hall.
A: X failed to prove the validity of their marriage. The
solemnization of a marriage without prior license is a
clear violation of the law and could lead or could be
used, at least, for the perpetration of fraud against
innocent and unwary parties. Salgado v Anson, G.R,
No, 204494, 2016)
Q: What is the concept of Lex Loci Celebrationis?
A: All marriages solemnized outside the Philippines,
in accordance with the laws in force in the country
where they were solemnized, and valid there as
such, shall also be valid in this country.
EXCEPTIONS: If the marriage is contracted by any
party below 18, or if the marriage is incestuous,
bigamous or polygamous; or is against public policy;
or involves a mistake in identity; or is a subsequent
marriage that is void under Art. 53; or is void because
of psychological incapacity, such marriage is void
even if the country where it is celebrated considers
the same valid (Family Code, Art. 26). Only the
formal requisites on who are authorized to solemnize
marriages, and the kind of ceremony to be performed
are waived by Art. 26. BUT there should still be a
solemnizing officer and a rite of solemnization, even
if performed abroad.
2. EXEMPTION FROM LICENSE
REQUIREMENT
Q: There are certain marriages where the
requirement of a marriage license is not required.
What are these marriages?
1. Art. 27 - Where either or both of the contracting
parties are at the point of death (marriage in
articulo mortis)
2. Art. 28 - Where the residence of either party is so
located that there is no means of transportation
to enable such party to appear personally before
the local civil registrar (marriage in a remote
place)
3. Art. 31 - Marriage in articulo mortis between
passengers or crew members may also be
solemnized by a ship captain or by an airplane
pilot not only while the ship is at sea or the plane
is in flight, but also during stopovers at ports of
call.
4. Art. 33 - Marriage among Muslims or among
members of the ethnic cultural communities; if
solemnized in accordance with their customs,
rites or practices.
5. Art. 34 - Marriage of a man and a woman who
have lived together as husband and wife for at
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least 5 years and without legal impediment to
marry each other (5-Year Cohabitation Rule).
3. MARRIAGES SOLEMNIZED
ABROAD AND FOREIGN
DIVORCE
Q: X, a Filipino citizen, married Y, a Japanese
national. Subsequently, pursuant to the laws of
Japan, they were divorced. X filed a petition for
judicial recognition of foreign divorce and
declaration of capacity to remarry. X presented
several foreign documents, including a duly
authenticated Divorce Certificate and two books
on the Civil Code of Japan for years 2000 and
2009. The RTC denied X’s petition, ruling that X
fell short of proving the national law, particularly
on divorce, of Y. It observed that the books
presented were not duly authenticated by the
Philippine Consul in Japan as required by
Sections 24 and 25 of Rule 132. Is the RTC
correct?
A: Yes. In order for a divorce obtained abroad by the
alien spouse to be recognized in our jurisdiction, our
law on evidence requires that both the divorce decree
and the national law of the alien must be alleged and
proven like any other fact. This means that the
foreign judgment and its authenticity must be proven
as facts under our rules on evidence, together with
the alien's applicable national law to show the effect
of the judgment on the alien himself or herself.
(Medina v. Koike, G.R. No. 215723, 2016).
Q: X was married to Y, a Japanese citizen. X and
Y submitted a “Divorce by Agreement” in Japan,
which was eventually approved. Thus, X filed a
petition for recognition of the divorce decree
before the RTC, which denied X’s petition,
invoking the nationality principle under Article
26(2) of the FC. The decision was grounded on
the fact that X admittedly initiated the divorce
proceedings and since X is a Filipino citizen
whose national laws do not allow divorce, then
the divorce decree obtained in Japan is not
binding in the Philippines. Is the RTC correct?
A: No. Pursuant to Republic v. Manalo, foreign
divorce decrees obtained to nullify marriages
between a Filipino and an alien citizen may already
be recognized in this jurisdiction, regardless of who
between the spouses initiated the divorce; provided,
of course, that the party petitioning for the recognition
of such foreign divorce decree — presumably the
Filipino citizen — must prove the divorce as a fact
and demonstrate its conformity to the foreign law
allowing it. In this case, X has yet to prove the fact of
her "Divorce by Agreement" obtained in Japan, in
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CIVIL LAW (AND PRACTICAL EXERCISES)
conformity with prevailing Japanese laws on divorce.
(Morisono v. Morisono, G.R. No. 226013, 2018.)
REMEMBER: Because of Republic v. Manalo:
1) Filipino spouse married to an alien spouse can
now initiate and obtain a divorce decree abroad;
2) Filipino spouse with the alien spouse can jointly file
and obtain a divorce decree abroad (Moraña v.
Republic); it can also be by consensual agreement
(Republic v. Mimori).
Art. 26(2) is no longer limited to the situation
where the alien spouse is the only one allowed to
obtain a divorce decree. However, divorce decree
and the national law of the alien spouse allowing
remarriage must still be proven in court according to
the rules of evidence.
4. VOID AND VOIDABLE
MARRIAGES
Q: X and Y were married in 1972. Then Y married
Z in 1979. Z filed a declaration of nullity of
marriage against Y on the ground of bigamy.
Meanwhile, Y was able to secure a judgment
declaring the 1972 marriage void due to the
absence of a marriage license. Will Z’s petition
for declaration of nullity of marriage against Y
prosper?
A: No, the requirement of a judicial decree of nullity
of a void marriage before contracting a subsequent
one does not apply to marriages that were celebrated
before the effectivity of the Family Code, particularly
if the children of the parties were born while the Civil
Code was in force. The first marriage of Y being void
for lack of license, there was no need for judicial
declaration of its nullity before he could contract the
second marriage with Z. Hence, the second marriage
to Z is valid. Neither can Y be held liable for bigamy.
Moreover, the provisions of the Family Code cannot
be retroactively applied to the present case, for to do
so would prejudice the vested rights of Y under the
Civil Code. (Castillo v. De Leon-Castillo, G.R. No.
189607, 2016)
Q: What are the prescriptive periods for filing an
action for annulment?
1. Within 5 years after attaining the age of 21 for
party whose parent did not give consent or
before the contracting party reaches 21 for the
parent, guardian, or the person having substitute
parental authority, if the marriage was
solemnized where one of the contracting parties
is 18 or over but below 21 without consent of
parents, guardian, or the person having
substitute parental authority.
2. Any time before death of either party or during
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lucid interval or after gaining sanity if the ground
is UNSOUND MIND
3. Within 5 years after the discovery of FRAUD
4. Within 5 years from the time the intimidation or
undue influence disappeared or ceased if the
ground is VITIATION OF CONSENT (i.e. force,
intimidation and undue influence)
5. Within 5 years after the celebration of marriage if
the ground is IMPOTENCE or STD which is
found to be serious and appears incurable
(Family Code, Art. 47).
Q: Can the heirs challenge or petition the nullity
or annulment of a subsequent marriage entered
into by their father?
A: IT DEPENDS.
1) YES, if the marriage was solemnized prior to the
effectivity of the Family Code. (Niñal v.
Bayadog)
2) NO, if the marriage was solemnized during the
effectivity of the Family Code pursuant to A.M.
No. 02-11-10-SC. (Enrico v. Medinacelli)
While it is true that Niñal in no uncertain terms
allowed therein petitioners to file a petition for the
declaration of nullity of their father's marriage to
therein respondent after the death of their father, we
cannot, however, apply its ruling for the reason that
the impugned marriage therein was solemnized prior
to the effectivity of the Family Code. The Court
in Niñal recognized that the applicable law to
determine the validity of the two marriages
involved therein is the Civil Code, which was the
law in effect at the time of their celebration.
As can be gleaned from the facts in Enrico v.
Medinacelli, the marriage was celebrated in 2004.
The language of A.M. No. 02-11-10-SC (took effect
on 15 March 2003) leaves no room for doubt. The
coverage extends only to those marriages entered
into during the effectivity of the Family Code which
took effect on 3 August 1988.
The Rationale of the Rules on Annulment of
Voidable Marriages and Declaration of Absolute
Nullity of Void Marriages, Legal Separation and
Provisional Orders explicates on Section 2 (a) in
the following manner, viz:
1) Only an aggrieved or injured spouse may file
petitions for annulment of voidable marriages
and declaration of absolute nullity of void
marriages. Such petitions cannot be filed by the
compulsory or intestate heirs of the spouses or
by the State. [Section 2; Section 3, paragraph a]
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CIVIL LAW (AND PRACTICAL EXERCISES)
2) The Committee is of the belief that they do not
have a legal right to file the petition. Compulsory
or intestate heirs have only inchoate rights prior
to the death of their predecessor, and hence can
only question the validity of the marriage of the
spouses upon the death of a spouse in a
proceeding for the settlement of the estate of the
deceased spouse filed in the regular courts. On
the other hand, the concern of the State is to
preserve marriage and not to seek its
dissolution.
Heirs (as children of the first marriage) clearly have
no cause of action. Nonetheless, all is not lost.
While A.M. No. 02-11-10-SC declares that a
petition for declaration of absolute nullity of void
marriage may be filed solely by the husband or
the wife, it does not mean that the compulsory or
intestate heirs are already without any recourse
under the law. They can still protect their
successional right, for, as stated in the Rationale of
the Rules on Annulment of Voidable Marriages and
Declaration of Absolute Nullity of Void Marriages,
Legal Separation and Provisional Orders,
compulsory or intestate heirs can still question
the validity of the marriage of the spouses, not in
a proceeding for declaration of nullity, but upon
the death of a spouse in a proceeding for the
settlement of the estate of the deceased spouse
filed in the regular courts.
a. Annulment under Art. 36 (As
recently articulated in Tan-
Andal v. Andal, 2021; Totality of
Evidence Rule)
Q: What kind of psychological incapacity is
contemplated under Article 36?
A: The psychological incapacity contemplated in
Article 36 of the Family Code is incurable, not in the
medical, but in the legal sense; hence, the third
Molina guideline is amended accordingly. This
means that the incapacity is so enduring and
persistent with respect to a specific partner, and
contemplates a situation where the couple's
respective personality structures are so incompatible
and antagonistic that the only result of the union
would be the inevitable and irreparable breakdown of
the marriage. "[A]n undeniable pattern of such
persisting failure [to be a present, loving, faithful,
respectful, and supportive spouse] must be
established so as to demonstrate that there is indeed
a psychological anomaly or incongruity in the spouse
relative to the other." (Tan-Andal v. Andal, G.R. No.
196359, 2021)
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Q: When must psychological incapacity manifest
to be a ground for termination of marriage?
A: Art. 36 provides that psychological incapacity
must appear at the time of the celebration of the
marriage, even if such incapacity becomes manifest
only after its solemnization. All grounds of void
marriages (nullity) must exist at the time of the
celebration of the marriage. The same rule for
voidable (annulment) marriages under Art. 45.
Q: In a case for declaration of nullity of marriage
under Art. 36, the Court denied the petition on the
ground that the expert opinions on the
psychological incapacity of the wife was solely
based on the husband’s version of the events. Is
there a requirement of personal examination to
declare a spouse as psychologically
incapacitated?
A: No. There is no requirement for one to be
personally examined by a physician, in order to be
declared psychologically incapacitated, because
what is important is the presence of the totality of
evidence that can sustain a finding of psychological
incapacity. Further, in the Tan-Andal case, the court
ruled that psychological incapacity is neither a mental
illness nor a personality disorder that needs to be
proven through expert opinion.
Q: Under Tan-Andal v. Andal, G.R. No. 196359,
2021), how is psychological incapacity
described? What are the guidelines or
parameters?
A: In determining psychological incapacity, the Court
uses the parameters under the Tan-
Andal guidelines. The following are the important
guide points to remember:
(1) The psychological incapacity must be shown to
have been existing at the time of the celebration
of marriage;
(2) Caused by a durable aspect of one's
personality structure, one that was formed prior to
their marriage;
(3) Caused by a genuinely serious psychic cause;
and
(4) Proven by clear and convincing evidence.
(5) Psychological incapacity is not a mental
incapacity nor a personality disorder that must
be proven through an expert witness. Ordinary
witnesses who have been present in the life of the
spouses before their marriage may testify on the
behaviors they have observed from the allegedly
incapacitated spouse.
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CIVIL LAW (AND PRACTICAL EXERCISES)
(6) Juridical antecedence of psychological
incapacity may also be proven by ordinary
witnesses who can describe the incapacitated
spouse's past experiences or environment
growing up, which may have triggered one's
particular behavior.
(7) Gravity of psychological incapacity must be
shown to have been caused by a genuinely
serious psychic cause. Thus, "mild
characterological peculiarities, mood changes,
occasional emotional outbursts" are still not accepted
grounds that would warrant a finding of psychological
incapacity under Article 36 of the Family Code.
(8) Tan-Andal also modified the requirement on
incurability — that psychological incapacity
under Article 36 of the Family Code must now be
incurable, not in the medical, but in the legal
sense. Thus, it must be so enduring and
persistent with respect to a specific partner, that
the only result of the union would be the inevitable
and irreparable breakdown of the marriage.
(9) Ultimately, the totality of evidence must
support a finding of psychological incapacity.
(Pugoy-Solidum v. Republic, G.R. No. 213954, [April
20, 2022])
Q: Wife alleged that husband was
psychologically incapacitated to comply with all
the essential marital obligations. She averred that
the husband showed complete lack of
understanding of his duties and responsibilities
as a husband and father during their marriage. He
never worked, and only depended on his older
sibling for financial support. Despite not earning,
he spent most of his time and money on gambling
and going to cockfights, instead of taking care of
his family. Based on the narrations of the wife,
the doctor diagnosed the husband with
narcissistic personality disorder with anti-social
and dependent traits that is characterized by an
overwhelming and grandiose sense of self-
importance. The doctor also testified that she
was not able to personally examine the husband
because the latter failed to respond to her
request for a psychological evaluation.
Nevertheless, she deemed the marital history
narrated by the wife as reliable and truthful. She
also stated that as a corroborating witness, wife’s
mother fully substantiated the wife's narration of
her history with the husband. Void for
psychological incapacity?
A: No. The psychological report is bereft of any
factual basis proving the husband's psychological
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incapacity. It fails to prove the enduring aspects of
the husband’s personality called "personality
structure" that manifest itself through clear acts of
dysfunctionality that render him unable to discharge
the essential marital obligations. Notably, there is no
evidence on record proving that the husband's
alleged psychological incapacity existed prior to their
marriage. Verily, the wife also failed to provide any
background on the husband's past experiences or
environment growing up that could have triggered his
behavior. Doctor’s findings were not related or linked
to the husband's alleged psychological incapacity
except in a general way.
Doctor’s findings are lacking in data as to the
husband’s personality structure and how it
incapacitates him to perform the essential marital
obligations. Neither does it prove that the husband’s
psychological incapacity is due to a genuine psychic
cause. To be sure, the report must clearly specify the
husband’s actions which are indicative of his alleged
psychological incapacity. In view of the absence of
evidence on the husband’s personality structure, it is
clear that the wife was not furnished with adequate
information on which to base the conclusion that the
husband is psychologically incapacitated.
To stress, what is important is that the totality of
evidence must support a finding of psychological
incapacity. In other words, the totality of evidence
must still be sufficient to prove that the incapacity was
grave, incurable, and existing prior to the time of the
marriage. The same wanting in this case. Apart from
the testimonies of the wife and the doctor, and the
latter's psychological report, there is no other
evidence presented to support the allegation of the
husband’s psychological incapacity.
(Pugoy-Solidum v. Republic, G.R. No. 213954, [April
20, 2022])
REMEMBER: Tan-Andal did not dispense with the
evidentiary requirements to prove psychological
incapacity. In order for a marriage to be declared
void on the ground of psychological incapacity, there
must still be a TOTALITY OF EVIDENCE sufficient
to prove gravity (genuine psychic cause), incurability
(in a legal sense), and juridical antecedence (existing
prior to the time of the marriage) as follows:
1) Doctor’s report and findings, even if not required
anymore, must have factual basis and cannot
just be in a general way.
2) It must prove the enduring aspects of the
husband’s personality called "personality
structure" that manifest itself through clear
acts of dysfunctionality by providing
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CIVIL LAW (AND PRACTICAL EXERCISES)
background on the past experiences or
environment growing up that could have
triggered the behavior of the psychologically
incapacitated spouse.
3) Must prove that the spouse’s psychological
incapacity is due to a genuine psychic cause
by clearly specifying the spouses actions
which are indicative of the alleged psychological
incapacity.
C. LEGAL SEPARATION
Q: What are the grounds for legal separation?
A: The grounds are:
1. Repeated physical violence or grossly abusive
conduct directed against petitioner, a common
child or a child of the petitioner
2. Physical violence or moral pressure to compel
the petitioner to change religious or political
affiliation
3. Attempt of respondent to corrupt or induce the
petitioner, a common child, or a child of the
petitioner, to engage in prostitution, or
connivance in such corruption or inducement
4. Final judgment sentencing respondent to
imprisonment of more than 6 years (even if
pardoned)
5. Drug Addiction or habitual alcoholism
6. Lesbianism or homosexuality
7. Subsequent bigamous marriage
8. Sexual Infidelity or perversion
9. Attempt by respondent against the life of the
petitioner
10. Abandonment for more than 1 year without
justifiable cause (Family Code, Art. 55).
Q: When does an action for legal separation
prescribe?
A: After five years from the time of the occurrence of
the cause (Family Code, Art. 57). The time of
discovery of the ground for legal separation is not
material in the counting of the prescriptive period
(STA. MARIA, Persons and Family Relations Law
444, 2022).
Q: What are the grounds for court denial of legal
separation?
A: Remember the Cs:
● Condonation,
● Consent,
● Connivance,
● Collusion,
● Co-guilt (both gave grounds for L/S) and
● Closed remedy (prescription).
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D. RIGHTS AND OBLIGATIONS
BETWEEN HUSBAND AND WIFE
Q: What are the obligations of the husband and
wife?
A: Obligations of Husband and Wife (L2H2DS) (Art.
68-71)
a. Live together
b. Observe mutual Love, respect and fidelity
c. Render mutual Help and support
d. Management of the Household
e. Fix the family Domicile
f. Joint responsibility for the Support of the
family
Q: Who has the power to fix the family domicile?
A: Both the husband and the wife. In case of
disagreement, however, the court shall decide.
(Family Code, Art. 69).
Q: What are the legal remedies should the
husband or wife neglect their duty?
A: When one of the spouses neglects his or her
duties to the conjugal union or commits acts which
tend to bring danger, dishonor, or injury to the other
or to the family, the aggrieved party may apply to the
court for relief. (Family Code, Art. 72)
E. PROPERTY RELATIONS
BETWEEN HUSBAND AND WIFE
1. GENERAL PROVISIONS
Q: What governs property relations between
spouses?
A: 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 a marriage settlement, or when the
regime agreed upon is void, the system of absolute
community of property as established in this Code
shall govern. (Family Code, Art. 75)
NOTE: Prior to the effectivity of the Family Code on
August 3, 1988, the system of conjugal partnership
of gains governed the property relations of husband
and wife.
Q: What are the requisites for the enforceability
of marriage settlements? (WSB-TC-CR)
1. In Writing
2. Signed by the parties
3. Executed Before the celebration of marriage
4. To fix the Terms and conditions of their property
relations
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5. If the party executing the settlement is under Civil
interdiction or any other disability, the guardian
appointed by the court must be made a party to
the settlement
6. Registration (to bind 3rd persons) (Family Code,
Art. 77).
2. DONATIONS BY REASON OF
MARRIAGE
Q: What are the requisites for donations by
reason of marriage? (BCF) (Art. 82)
1. Made Before celebration of marriage;
2. In Consideration of marriage; and
3. In Favor of one or both future spouses
Q: What are the grounds to revoke donations
propter nuptias? (CARNIVAL) (Art. 86)
a. Marriage without the needed parental
Consent
b. Marriage is Annulled and donee is in bad
faith
c. If it is with a Resolutory condition and the
condition is complied with
d. Marriage is Not celebrated
e. Donee commits acts of Ingratitude such as:
i. Commits an offense against the
person, honor or property of the
donor, his wife, or children under
his parental authority
ii. Imputes to the donor any criminal
offense or any act involving moral
turpitude, unless the crime was
committed against the donee
himself, his wife, or children under
his authority
iii. Unduly refuses to support the donor
when he is legally or morally bound
to give such support
f. Marriage is judicially declared Void Ab initio
g. In Legal separation and donee is the guilty
spouse
3. ABSOLUTE COMMUNITY OF
PROPERTY
Q: What remains as exclusive property in an
Absolute Community of Property:
(1) Property acquired before the marriage by
either spouse who has legitimate descendants
by a former marriage and its fruits and income
(2) Property for personal and exclusive use,
except jewelry
(3) Property acquired during the marriage by
gratuitous title plus its fruits and income,
except when the donor, testator, or grantor
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expressly provides otherwise (Art. 92)
Q: A and B are husband and wife. As such they
bought a house and cohabited therein, but the
title is issued only in the name of the husband A
and the Torrens title indicated that he was single.
The relationship of the spouses became strained
and B filed a case for concubinage and legal
separation against A. B later learned that her
husband had the intention of selling the property
to C, their neighbor, so B then advised C of the
existence of the case and cautioned C against
buying the property until the cases are closed
and terminated. Nonetheless, A still sold the
property to C, without the consent of B. B
contends that the sale is void as it was without
her consent. C argues that he is an innocent-
purchaser for value and had the right to rely on
the Torrens title. Is C correct?
A: No, the sale is void. One spouse cannot sell
community property without the written consent of the
other spouse or the authority of the court. The
purchaser was not in good faith. While the law does
not require a person dealing with registered land to
inquire further than what the Torrens Title on its face
indicates (Nobleza v. Nuega G.R. No. 193038, March
11, 2015), this rule shall not apply when the party has
actual knowledge of facts and circumstances that
would impel a reasonably cautious person to make
inquiry into the status of the title of the property, or
when the purchaser has knowledge of a defect or the
lack of title in his vendor. (Malabanan v. Malabanan,
G.R. No. 187225, March 6, 2019)
4. CONJUGAL PARTNERSHIP
OF GAINS
Q: What constitutes Conjugal Partnership of
Gains? (FOLCHIC)
1. Fruits of conjugal property due or received during
the marriage and net fruits of separate property
2. Those acquired through Occupation
3. Livestock in excess of what was brought to the
marriage
4. Those acquired during the marriage with
Conjugal funds
5. Share in Hidden treasure
6. Those obtained from labor, Industry, work or
profession of either or both spouse
7. Those acquired by Chance (Family Code, Art.
117).
Q: What are the exclusive properties of spouses
in a Conjugal Partnership of Gains? (OGRE)
1. That which is brought to the marriage as his or
her Own;
2. That which each acquires during the marriage by
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CIVIL LAW (AND PRACTICAL EXERCISES)
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 wife of the husband (Family Code, Art. 109).
Q: Solomon sold his coconut plantation to
Aragon, Inc. for P100 million, payable in
installments of P10 million per month with 6%
interest per annum. In the meantime, Solomon
married Lorna and they chose the regime of
conjugal partnership of gains to govern their
property relations in their ante-nuptial
agreement. To whom will Aragon’s monthly
installment payments go after the marriage?
A: The principal shall go to Solomon while the
interests go to the conjugal partnership. The fruits,
natural, industrial, or civil, due or received during the
marriage from the common property, as well as the
net fruits from the exclusive property of each spouse
are included in the conjugal partnership properties
(Family Code, Art. 117(3)).
5. SEPARATION OF PROPERTY
AND ADMINISTRATION OF
COMMON PROPERTY BY
ONE SPOUSE DURING THE
MARRIAGE
Q: When may a spouse assume sole powers of
administration?
A: Only in the event that one spouse is incapacitated
or otherwise unable to participate in the
administration of the conjugal properties. These
powers do not include disposition or encumbrance
without authority of the court or the written consent of
the other spouse.
NOTE: In the absence of such authority or consent,
the disposition or encumbrance shall be void, but
may be perfected as a binding contract upon the
acceptance by the other spouse or authorization by
the court before the offer is withdrawn. (Family Code,
Art. 124).
Q: Can an extrajudicial dissolution of the
conjugal partnership without judicial approval be
valid?
A: An extrajudicial dissolution of the conjugal
partnership without judicial approval is void. A notary
public should not facilitate the disintegration of a
marriage and the family. In so doing a notary public
may be held accountable administratively (Rodolfo
Espinoso v. Juliet Omana, A.C. 9081, 2011).
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Q: What are considered sufficient causes for
judicial separation?
a. That the spouse of the petitioner has been
sentenced to a penalty which carries with it
civil interdiction
b. That the spouse of the petitioner has been
judicially declared an absentee
c. That loss of parental authority of the spouse
of petitioner has been decreed by the court
d. That the spouse of the petitioner has
abandoned the latter or failed to comply with
his or her obligations to the family as
provided for in Article 101
e. That the spouse granted the power of
administration in the marriage settlements
has abused that power
f. That at the time of the petition, the spouses
have been separated in fact for at least one
year and reconciliation is highly improbable
In the cases provided for in letters (a), (b) and (c), the
presentation of the final judgment against the guilty
or absent spouse shall be enough basis for the grant
of the decree of judicial separation of property.
Q: What are the grounds for transfer of
administration of exclusive Property of either
spouse? (GACA) (Art. 142)
a. One spouse becomes Guardian of the
other
b. One spouse is judicially declared
Absent
c. One spouse is sentenced to penalty
with Civil interdiction
d. One spouse becomes a fugitive from
justice or is hiding as an Accused in a
criminal case
If the other spouse is not qualified by reason of
incompetence, conflict of interest, or any other just
cause, the court shall appoint a suitable person to
be the administrator.
6. REGIME OF SEPARATION OF
PROPERTY
Q: What are the rights and liabilities of the
spouses in a regime of separation of property?
A: Each spouse shall:
a. Own, dispose of, possess, administer and
enjoy his or her own separate estate, without
need of the consent of the other
b. Own all earnings from his or her own
profession, business or industry
c. Own all fruits, natural, industrial or civil, due
or received during the marriage from his or
her separate property.
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CIVIL LAW (AND PRACTICAL EXERCISES)
Both spouses shall bear the family expenses in
proportion to their income, or, in case of insufficiency
or default thereof, to the current market value of their
separate properties. The liability of the spouses to
creditors for family expenses shall be solidary. (Art.
146)
7. PROPERTY REGIME OF
UNIONS WITHOUT
MARRIAGE
Q: When A and B married, they chose conjugal
partnership of gains to govern their property
relations. After 3 years, B succeeded in getting
her marriage to A declared null and void on
ground of the latter’s psychological incapacity.
What liquidation procedure will they follow in
disposing of their assets?
A: Their properties will be liquidated according to Art.
147. When a man and a woman who are capacitated
to marry each other, live exclusively with each other
as husband and wife without the benefit of marriage
or under a void marriage, their wages and salaries
shall be owned by them in equal shares and the
property acquired by both of them through their
work or industry shall be governed by the rules
on co-ownership (Family Code, Art.147).
Q: In the property relations based on Art. 148, is
there a presumption that the contributions to the
property between the man and woman are equal?
A: This presumption will only apply if there is proof
of actual contribution from both parties and the share
of each is unknown or not proven. Art. 148 states that
in the absence of proof to the contrary, the
contribution of the partners and corresponding
shares are presumed to be equal. Before this
presumption can apply, there must be actual proof of
contribution first from both parties.
Q: What rules on property relations apply to a
marriage declared void on the ground of
psychological incapacity under Art. 36?
A: Co-ownership. The applicable law, however, in so
far as the liquidation of the conjugal partnership
assets and liability is concerned, is Article 129 of
the Family Code in relation to Article 147 of
the Family Code. XXX The Court held that in a void
marriage, as in those declared void under Article
36 of the Family Code, the property relations of the
parties during the period of cohabitation is governed
either by Article 147 or Article 148 of the Family
Code. Article 147 of the Family Code applies to union
of parties who are legally capacitated and not barred
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by any impediment to contract marriage, but whose
marriage is nonetheless void, as in this case.
From the foregoing, property acquired by both
spouses through their work and industry should,
therefore, be governed by the rules on equal co-
ownership. Any property acquired during the union
is prima facie presumed to have been obtained
through their joint efforts. A party who did not
participate in the acquisition of the property shall be
considered as having contributed to the same jointly
if said party's efforts consisted in the care and
maintenance of the family household. Efforts in the
care and maintenance of the family and household
are regarded as contributions to the acquisition of
common property by one who has no salary or
income or work or industry. (Ocampo v. Ocampo)
Q: Judicial declaration of nullity became final
prior to the death of the husband. Will the
Absolute Community Property regime still apply?
A: No. Since the marriage judicially decreed to be
void ab initio or from the beginning, ACP regime will
not govern. If the property was registered in the
names of the spouses, and there being no proof to
the contrary, the subject property is presumed to
have been obtained by their joint efforts, work or
industry, and was owned in equal shares by them
pursuant to Article 147.
Consequently also, the property cannot be the
subject of a deed of donation as it is a prohibited
disposition under Article 147 of the Family Code,
which expressly mandates that: "Neither party can
encumber or dispose by acts inter vivos of his or her
share in the property acquired during cohabitation
and owned in common, without the consent of the
other, until after the termination of their cohabitation."
(Perez v. Perez-Senerpida, GR No. 233365, J.
Caguioa (2021)
F. FAMILY HOME
Q: What is a Family Home?
A: The dwelling house where they (husband and wife
or an unmarried head of the family) and their family
reside, and the land on which it is situated. (Art. 152,
Family Code)
Q: What are the rules with regard to a Family
Home?
A: A Family Home must:
1. be owned by the person constituting it
2. must be permanent
3. continues despite the death of one or more
spouses or unmarried head of the family for
10 years or as long as there is a minor
beneficiary (Art. 159)
4. Only one FH can be constituted
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CIVIL LAW (AND PRACTICAL EXERCISES)
Q: What property can qualify as a Family Home?
A: Actual value of the family home shall not exceed,
at the time of its constitution, P300,000 in urban
areas and P200,000 in rural areas. (Art.157, Family
Code)
Any subsequent improvement of the family home by
the persons constituting it, its owners, or any of its
beneficiaries will still be exempt from execution,
forced sale or attachment provided the following
conditions obtain:
(1) The actual value of the property at the time of its
constitution does not exceed Php 300,000 in
urban areas and Php 200,000 in rural areas
under Art. 157; and
(2) The improvement does not result in an increase
in its value exceeding the statutory limit.
G. PATERNITY AND FILIATION
Q: What are legitimate children?
A: Those conceived or born during a valid marriage.
(Art. 164, Family Code).
An agreement by parties as to the status of a child is
void. Only the law determines legitimacy or
illegitimacy. Thus, the child, in the eyes of the law, is
legitimate under the first marriage notwithstanding
the admission in pleadings by the wife and her
second husband that the child is their legitimate son.
Similarly, any declaration of the mother that her child
is illegitimate has no probative value. (Concepcion v.
CA, G.R. No. 123450, 2005)
Q: How does one prove legitimate or illegitimate
filiation?
A: Filiation can be proven by any of the ff:
(1) The record of birth appearing in the civil
register or a final judgment
(2) An admission of legitimate or illegitimate
filiation in a public document or a private
handwritten instrument and signed by the
parent concerned.
In the absence of the foregoing, the following can
be used:
(1) Open and continuous possession of the
status of a legitimate (or illegitimate) child
(2) Any other means allowed by the Rules of
Court and special laws
Q: What are the requisites for legitimation?
A: The requisites are:
(1) The child was conceived and born out of
wedlock;
(2) The parents, at the time of child’s
conception, were not disqualified by any
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impediment to marry each other or were
disqualified only because either or both of
them were below 18; and
(3) There is a valid marriage subsequent to the
child’s birth.
Q: What are the effects of legitimation?
A: The effects are:
(1) Confers on the child the rights of legitimate
children
(2) Retroacts to the time of the child’s birth
(3) The legitimation of children who died before
the celebration of the marriage shall benefit
their descendants
H. ADOPTION
Note that RA 8552 and RA 9523 were repealed, and
RA 8043 amended, by RA 11642, which took effect
on January 28. 2022 (beyond the cut-off date for the
2022 Bar).
1. DOMESTIC ADOPTION (R.A. No.
8552)
a. Who May Adopt
Q: Who may adopt under RA 8552?
a. A Filipino citizen of:
1. Legal age;
2. In possession of full civil capacity and legal
rights;
3. Good moral character
4. Has not been convicted of any crime
involving moral turpitude;
5. Emotionally and psychologically capable of
caring for children;
6. In a position to support and care for his
legitimate and illegitimate children, in keeping
with the means of the family and;
7. At least 16 years older than the person to be
adopted, unless the adopter is:
i. The natural parent of the child to be
adopted, or
ii. The spouse of the legitimate parent of
the person to be adopted (Sec. 7, R.A.
8552)
b. Alien
1. Possessing the same qualifications as above
stated for Filipino nationals;
2. His/her country has diplomatic relations with
the Philippines;
3. He/she has been living in the Philippines for
at least 3 continuous years prior to the filing
of the application for adoption and maintains
BACK TO TOP
CIVIL LAW (AND PRACTICAL EXERCISES)
such residence until the adoption decree is
entered;
4. He/she has been certified by his/her
diplomatic or consular office or any
appropriate government agency that he/she
has the legal capacity to adopt in his/her
country;
5. His/her government allows the adoptee to
enter his/her country as his/her adopted
son/daughter
Requirements for No. 3 and 4 may be waived in
the following instances:
1. A former Filipino citizen who seeks to adopt a
relative within the 4th degree of consanguinity
or affinity; or
2. One who seeks to adopt the legitimate child
of his/her Filipino spouse; or
3. One who is married to a Filipino citizen and
seeks to adopt jointly with his/her spouse a
relative within the 4th degree of consanguinity
or affinity of the Filipino spouse
c. Guardians
With respect to the ward after the termination of the
guardianship and clearance of his/her financial
accountabilities.
All statutory requirements for adoption must be met,
and when a court issues an adoption decree despite
the fact that all the said requirements are not met,
such decree is a nullity (In re O’Keefe, 164 Misc 473).
Q: What are the exceptions to the rule that
spouses must jointly adopt?
1. One spouse seeks to adopt the legitimate
son/daughter of the other;
2. One spouse seeks to adopt his/her own
illegitimate son/daughter. This is provided
that the other spouse has signified his/her
consent; or
3. The spouses are legally separated from each
other
b. Who May be Adopted
Q: Who may be adopted? (BAILORP)
a. Any person Below 18 years of age who has
been administratively or judicially declared
available for adoption
b. Under R.A. 9523, a child which can be
certified as “legally Available for adoption”
includes a person below eighteen (18) years
of age or a person over eighteen (18) years
of age but is unable to fully take care of
him/herself or protect him/herself from abuse,
neglect, cruelty, exploitation, or
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discrimination because of physical or mental
disability or condition
c. Illegitimate son/daughter by a qualified
adopter to improve his/her status to that of
legitimacy
d. Legitimate son/daughter of one spouse by
the other spouse
e. Person of legal age if, prior to the adoption,
said person has been consistently
considered and treated by the adopter as
his/her Own child since minority;
f. Child whose adoption has been previously
Rescinded
g. Child whose biological or adoptive Parents
have died provided that no proceedings shall
be initiated within 6 months from the time of
death of said parents
Q: When is the effectivity date of the decree of
adoption?
A: A decree of adoption is effective as of the date the
original petition was filed. This also applies in case
the petitioner dies before the issuance of the decree
of adoption
Where the petition for adoption was granted after the
child killed a girl, no retroactive effect may be given
to the decree of adoption so as to impose a liability
upon the adopting parents accruing at a time when
the adopting parents had no actual or physically
custody over the adopted child. Retroactive effect
may perhaps be given where such is essential to
permit the accrual of some benefit or advantage in
favor of the adopted child. To hold that parental
authority had been retroactively lodged in the
adopting parents so as to burden them with liability
for a tortious act that they could not have foreseen
nor prevented would be unfair and unconscionable
(Tamargo v. CA, G.R. No. 85044,1992 ).
c. Rights of an adopted child
Q: What are the effects of adoption?
a. Sever all legal ties between the biological
parent(s) and the adoptee, except when the
biological parent is the spouse of the adopter;
b. Deem the adoptee as a legitimate child of the
adopter; and
c. Give adopter and adoptee reciprocal rights
and obligations arising from the relationship
of parent and child, including but not limited
to:
1. The right of the adopter to choose the
name the child is to be known; and
2. The right of the adopter and adoptee
to be legal and compulsory heirs of
each other.
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CIVIL LAW (AND PRACTICAL EXERCISES)
Therefore, even if emancipation terminates parental
authority, the adoptee is still considered a legitimate
child of the adopter with all the rights of a legitimate
child such as:
(1) to bear the surname of the father and the
mother;
(2) to receive support from their parents; and
(3) to be entitled to the legitime and other
successional rights (In Re: Petition for
Adoption of Michelle P. Lim, Monina P. Lim,
G.R. Nos. 168992-93, 2009).
Q: What are the rules on succession?
A: In legal and intestate succession, the adopters
and the adoptee shall have reciprocal rights of
succession without distinction from legitimate
filiation. However, if the adoptee and his/her
biological parents had left a will, the law on
testamentary succession shall govern.
d. Instances and Effects of
Rescission
Q: Who may file for rescission of the adoption
decree?
A: Only the adoptee may file for rescission. The
adopter may disinherit the adoptee for causes under
Art. 919 of the NCC.
Q: What are the grounds for rescission of
adoption? (MASA)
a. Repeated physical and verbal Maltreatment
by the adopters despite having undergone
counseling
b. Attempt on the life of the adoptee
c. Sexual assault or violence
d. Abandonment and failure to comply with
parental obligations.
Q: What are the effects of the rescission of the
adoption?
a. The parental authority of the adoptee's
biological parents, if known, OR the legal
custody of the DSWD shall be restored if the
adoptee is still a minor or incapacitated.
b. The reciprocal rights and obligations of the
adopters and the adoptee to each other shall
be extinguished.
c. The court shall order the Civil Registrar to
cancel the amended certificate of birth of the
adoptee and restore his/her original birth
certificate.
d. Succession rights shall revert to its status
prior to adoption, but only as of the date of
judgment of judicial rescission. Vested rights
acquired prior to judicial rescission shall be
respected.
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2. INTER-COUNTRY ADOPTION (RA
8043)
a. When allowed
Inter-Country Adoption: Refers to the socio legal
process of adopting a Filipino child by a foreigner or
a Filipino citizen permanently residing abroad where
the petition is filed, the supervised trial custody is
undertaken, and the decree of adoption is issued
outside the Philippines
NOTE: A “child” refers to a person below fifteen
(15) years of age unless sooner emancipated by
law
b. Who may adopt
Q: What are the qualifications and
disqualifications of an adopter?
A: An alien or a Filipino citizen permanently residing
abroad may file an application for inter-country
adoption of a Filipino child if: (DEBT-CAMPS)
a. Comes from a country with whom the
Philippines has Diplomatic relations and
whose government maintains a similarly
authorized and accredited agency and that
adoption is allowed under his/her national
laws;
b. Eligible to adopt under his/her national law;
c. Agrees to uphold the Basic rights of the child
as embodied under Philippine laws, the U.N.
Convention on the Rights of the Child, and to
abide by the rules and regulations issued to
implement the provisions of this Act;
d. Has not been convicted of a crime involving
moral Turpitude;
e. Has the Capacity to act and assume all rights
and responsibilities of parental authority
under his national laws, and has undergone
the appropriate counseling from an
accredited counselor in his/her country;
f. At least 27 years of Age and at least 16 years
older than the child to be adopted, at the time
of application unless the adopter is the parent
by nature of the child to be adopted or the
spouse of such parent;
g. If Married, his/her spouse must jointly file for
the adoption;
h. Possesses all the qualifications and none of
the disqualifications provided herein and in
other applicable Philippine laws; and
i. In a position to provide the proper care and
Support and to give the necessary moral
values and example to all his children,
including the child to be adopted
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CIVIL LAW (AND PRACTICAL EXERCISES)
c. Who may be adopted
Q: Who may be adopted?
A: Only a legally free child may be the subject of
inter-country adoption
Legally-free child: A child who has been voluntarily
or involuntarily committed to the Department, as
dependent, abandoned, or neglected, in
accordance with the Child and Youth Welfare Code
No child shall be matched to a foreign adoptive family
unless it is satisfactorily shown that the child cannot
be adopted locally.
IMPORTANT TO NOTE:
There are differences between the two adoption
laws regarding:
a. Definition of a child
b. Procedure (where to file, what petition may
include, publication requirements, supervised
trial custody)
c. Qualifications of adopter
d. Who may be adopted
e. Court that issues decree of adoption (Family
court vs. Foreign court)
I. SUPPORT
Q: What does support consist of?
A: Support consists of: (METS-DC) (Art. 194)
1. Medical attendance
2. Education – includes schooling (formal
education) or training (non-formal
education) for some profession, trade or
vocation, even beyond the age of majority
3. Transportation – includes expenses going to
and from school, or to and from place of
work (Art. 194)
4. Sustenance
5. Dwelling
6. Clothing
Q: Who are obligated to give support?
A: The following are obliged to give support: (SAPL)
(Art. 195)
1. Spouses
2. Legitimate Ascendants and Descendants
3. Parents and their Legitimate/Illegitimate
Children/Grandchildren
4. Legitimate Brothers and Sisters, whether full
or half-blood
Q: Is a foreigner obliged to give support to his
minor child under Philippine law?
A: It depends on the national law of the foreigner.
(Art. 15, NCC) Insofar as Philippine laws are
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concerned, specifically the provisions of the Family
Code on support, the same only applies to Filipino
citizens. Petitioner cannot rely on Article 195 in
demanding support from respondent, who is a foreign
citizen. However, in view of respondent’s failure to
prove the national law of the Netherlands, the
doctrine of processual presumption shall govern,
which states that if the foreign law involved is not
properly pleaded and proved, our courts will presume
that the foreign law is the same as our local or
domestic or internal law. Thus, the law in the
Netherlands is presumed to be the same with
Philippine law, which enforces the obligation of
parents to support their children and penalizing the
non-compliance therewith. Moreover, foreign law
should not be applied when its application would
work undeniable injustice to the citizens or residents
of the forum. (Norma A. Del Socorro, for and on
behalf of her minor child, Roderigo Norjo Van Wilsem
v. Ernst Johan Brinkham Van Wilsem, G.R. No.
193707)
Q: What is support Pendente Lite?
A: Support given during the proceedings for:
● Legal separation
● Annulment of marriage, and
● Declaration of nullity of marriage
Q: What is the effect of a judgment on the case to
the obligation to give support?
A: General Rule: As between spouses, the
obligation of mutual support ceases after final
judgment granting the petition.
Exception: This is unless, in case of legal
separation, the court orders the guilty spouse to
furnish support to the innocent one, specifying the
terms thereof
Q: What is the source of support?
A: The absolute community or the conjugal
partnership (Art. 198)
While adultery may be a defense in an action for
personal support, that is, support of the wife by the
husband from his own funds, it is not a defense when
the support is to be taken from the conjugal
partnership property. (Lerma v. Court of Appeals,
G.R. No. L-33352)
J. PARENTAL AUTHORITY
Q: What is parental authority?
A: The mass of rights and obligations which parents
have in relation to the person and property of their
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CIVIL LAW (AND PRACTICAL EXERCISES)
children until their emancipation, and even after,
under certain circumstances.
Q: What are the rules on parental authority?
A: The rules are the following:
a. The father and the mother shall jointly
exercise parental authority over the persons
of their common children. In case of
disagreement, the father's decision shall
prevail, unless there is a judicial order to the
contrary (Art. 211);
b. If the child is illegitimate, parental authority
is with the mother;
c. In case of absence or death of either parent,
the parent present shall continue exercising
parental authority (Art. 212);
● The marriage of the surviving
parent shall not affect parental
authority over the children, unless
the court appoints another person
to be the guardian of the person or
property of the children
d. In case of separation of the parents, parental
authority shall be exercised by the parent
designated by the Court
● The Court shall take into account all
relevant considerations, especially
the choice of the child over 7 years
of age, unless the parent chosen is
unfit
● No child under 7 years old shall be
separated from the mother, unless
the Court finds compelling reasons
to order otherwise
Q: What is substitute parental authority?
A: In default of parents or a judicially appointed
guardian, substitute parental authority shall be
exercised by:
1. The surviving grandparent;
2. The oldest brother or sister over 21 years
old, unless unfit or disqualified;
3. The child’s actual custodian, over 21 years
old, unless unfit or disqualified (Art. 216)
Q: What is special parental authority?
A: Special parental authority can be exercised only
over minors while under their supervision, instruction,
or custody. The authority and supervision also attach
to all authorized activities whether inside or outside
the school, entity, or institution.
Such is exercised by:
a. School
b. Administrators and teachers
c. Individual, entity, or institution engaged in
childcare
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Q: What are the grounds for suspension of
parental authority? (CHOBA)
a. Conviction of parent for crime with civil
interdiction (Art. 230)
b. Treats child with excessive Harshness and
cruelty
c. Gives corrupting Orders counsel, or example
d. Compels child to Beg
e. Subjects to or allows him to be subjected to
Acts of lasciviousness (Art. 231)
Q: How can parental authority be terminated?
a. Death of parents
b. Death of child
c. Emancipation of child
d. Parents exercising parental authority has
subjected the child or allowed him to be
subjected to sexual abuse (ground for
permanent termination) (Art. 228)
Other Cases Where Parental Authority May Be
Terminated (Art. 229)
a. Adoption of child
b. Appointment of general guardian
c. Judicial declaration of abandonment
d. Final judgment divesting parental authority
e. Judicial declaration of absence or incapacity
of person exercising parental authority
K. EMANCIPATION
Q: What is emancipation?
A: Emancipation takes place by the attainment of
majority. Unless otherwise provided, majority
commences at the age of eighteen years (Art. 234,
as amended by RA 6809)
Q: What is the effect of emancipation?
A: Emancipation for any cause shall terminate
parental authority over the person and property of the
child who shall then be qualified and responsible for
all acts of civil life, save the exceptions established in
by existing laws in special cases.
Contracting marriages shall require parental consent
until the age of twenty-one. (Art. 236)
L. RETROACTIVITY OF FAMILY
CODE
Q: Can the Family Code be applied retroactively?
A: Yes. This code shall have retroactive effect insofar
as it does not prejudice or impair vested or acquired
rights in accordance with the Civil Code or other laws
(Art. 256)
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CIVIL LAW (AND PRACTICAL EXERCISES)
Since the petitioner and the respondent suffer no
legal impediment and exclusively lived with each
other under a void marriage, their property relation is
one of co-ownership under Article 147 of the Family
Code. The said provision finds application in this
case even if the parties were married before the
Family Code took effect by express provision of
the Family Code on its retroactive effect for as
long as it does not prejudice or impair vested or
acquired rights in accordance with the Civil Code
or other laws (Paterno v. Paterno, G.R. No.
213687).
III. SUCCESSION
A. GENERAL PROVISIONS
Q: Distinguish Succession from Inheritance.
A: Succession refers to the legal mode by which
inheritance is transmitted to the persons entitled to it;
while inheritance refers to the universality or entirety
of the property, rights and obligations of a person
who died.
Q: When are the rights to succession
transmitted?
A: The rights to the succession are transmitted from
the moment of the death of the decedent. (Art. 777)
However, a person may be presumed dead for the
purpose of opening his succession. (See rules on
presumptive death, Art. 390-391) Upon application,
the court can issue a decree of presumptive death which
will allow succession to open despite the lack of proof of
actual death.
Q: Can future inheritance be the subject of a
contract of sale?
A: No, because the seller, who has to acquire any
right to the inheritance while his predecessor lives,
cannot sell any future inheritance, as an exception to
the general rule that future things can be subject of
valid contracts. Seller is betting against the life of the
person whom he will inherit from, thus, any
disposition becomes a wagering contract, which is
against public policy. (Art. 1347 in relation to Art. 777)
Q: Before her parents’ death, Y executed an
instrument in favor of X, entitled “Waiver of
Hereditary Rights and Interest Over a Real
Property (Still Undivided)”. Z contends that the
waiver of rights and interests executed by Y is
null and void for violating Article 1347 of the Civil
Code, prohibiting future inheritance to be the
object of contracts. Is Y’s waiver of hereditary
rights valid?
A: No. The second paragraph of Article 1347 of the
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Civil Code provides that no contract may be entered

into upon a future inheritance except in cases Q: What law governs the extrinsic and intrinsic
expressly authorized by law. A contract may be validity of wills as to place and time?
classified as a contract upon future inheritance if the
following requisites concur: (1) that the succession EXTRINSIC INTRINSIC
has not yet been opened (2) that the object of the VALIDITY VALIDITY
contract forms part of the inheritance (3) that the GOVERNING For Filipinos For Filipinos:
promissor has, with respect to the object, an LAW AS TO and Law at the time
expectancy of a right which is purely hereditary in TIME Foreigners: of death (Art.
nature. In this case, there is no question that at the Law at the 16 & 2263)
time of execution of Y’s “Waiver of Hereditary Rights time of
and Interest Over a Real Property (Still Undivided)”, execution For Foreigners:
succession to either of her parents’ properties has not (Art. 795) National law
yet been opened since both of them are still living. (Art. 16, par.2;
With respect to the other two requisites, both are Art. 1039)
likewise present considering that the property subject
matter of Y’s waiver concededly forms part of the
properties that she expects to inherit from her parents GOVERNING For Filipinos For Filipinos:
upon their death and, such expectancy of a right, as LAW AS TO and Philippine law
shown by the facts, is undoubtedly purely hereditary PLACE Foreigners:
in nature. Y’s waiver of hereditary rights is not valid (Art. 815-817) For Foreigners:
and cannot be the source of any right or create any National law
obligation. No contract may be entered into upon a a. Citizenship
future inheritance except in cases expressly b. Domicile
authorized by law. (Ferrer v. Diaz, G.R. No. 165300, c. Residence
April 23, 2010) d. Place of
Execution
B. TESTAMENTARY SUCCESSION / e. Philippine
Law
WILLS

1. WILLS Q: On December 1, 2000, Dr. Juanito Fuentes

Q: What is a will?
A: It is an act whereby a person is permitted with the
formalities prescribed by law to control to a certain
degree the disposition of his estate to take effect after
his death. (Art. 783) It will disposes only the free
portion of the estate unless otherwise provided by
the testator, subject to the limitation of legitime. (Art.
886; Balane, supra, p. 38)
Q: What is the Principle of Severability in
relation to the ambiguity in a will?
A: The invalidity of one of several dispositions
contained in a will does not result in the invalidity of
the other dispositions unless it is to be presumed that
the testator would not have made such other
dispositions if the first invalid disposition had not
been made. (Art. 792)
Q: Are properties acquired after the execution of
the will deemed part of the properties being
disposed of?
A: No. Property acquired during the period between
the execution of the will and the death of the testator
is NOT included among the property disposed of,
except when a contrary intention expressly appears
on the will. (Art. 793)
executed a holographic will, wherein he gave
nothing to his recognized illegitimate son, Jay.
Dr. Fuentes left for the United States, passed the
New York medical licensure examinations,
resided therein, and became a naturalized
American citizen. He died in New York in 2007.
The laws of New York do not recognize
holographic wills or compulsory heirs.
a. Can the holographic will of Dr. Fuentes
be admitted to probate in the
Philippines? Why or why not?
b. Assuming that the will is probated in the
Philippines, can Jay validly insist that he
be given his legitime? Why or why not?
(2009 Bar)
A:
a. Yes, as probate deals with the extrinsic
validity of the will. The law that governs the
execution of the will may be Philippine law,
or the law of the country where the testator
is a citizen, or where the testator resides,
or where he executed the will. As
Philippine law recognizes holographic
wills, the probate court will only have to
determine whether the will conforms to the
formalities of holographic wills in

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accordance with Philippine law.
a. No, Jay cannot insist on his legitime. The
intrinsic validity of the will, the order of
succession, and the amount of
successional rights are determined by the
national law of the testator (Art. 16). Since
the laws of New York do not recognize
compulsory heirs, Jay cannot claim his
status as such (Bellis v. Bellis, G.R. No. L-
23678, 1967).
Q: Who are capacitated to make a will?
A: The following are capacitated to make a will:
(NES)
1. Natural person not expressly prohibited by
law to make a will. (Art. 796)
2. Eighteen (18) years old and above (Art.
797).
3. Of Sound mind, at the time of its execution
(Art. 798)
All of these must be present at the time of the
execution of the will. (in relation with Art. 801)
Q: When is a testator considered to be of sound
mind?
A: To be of sound mind, it is not necessary that the
testator be in full possession of all his reasoning
faculties, or that his mind be wholly unbroken,
unimpaired, or unshattered by disease, injury or other
cause. (Art. 799)
A testator is considered of sound mind if at the time
of making of the will he knows the following:
1. Nature of the estate to be disposed of - The
testator should have a fairly accurate
knowledge of what he owns. (Balane,
supra, p. 53)
2. Proper objects of his bounty - The testator
should know under ordinary circumstances,
who his relatives in the most proximate
degrees, are as well as the justifiable
beneficiaries of his estate. (Balane, supra,
p. 53)
3. Character of the testamentary act (Art.
799) - The testator should know the legal
nature of a will. He or she must know that
he is executing a document that disposes
of his properties gratuitously, which would
take effect upon his death. (Balane, supra,
p. 53- 54)
Q: Who has the burden of proving that the testator
was not of sound mind at the time of the execution of
the will?
A: The burden is on the person who opposes the
probate of the will. As a general rule, the law
presumes that every person is of sound mind, in the
absence of proof to the contrary. However, if the
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CIVIL LAW (AND PRACTICAL EXERCISES)
testator, one month, or less, before making his will,
was publicly known to be insane, the burden of
proving that the testator made the will during a lucid
interval shifts to the person who maintains the validity
of the will. (Art. 800)
Q: During probate proceedings, Z testified that X
was “forgetful because she would sometimes
leave her wallet in the kitchen then start looking
for it moments later.” Did Z’s testimony clearly
prove that X is of unsound mind when X executed
her will?
A: No. Forgetfulness is not equivalent to being of
unsound mind. A testator is presumed to be of sound
mind at the time of the execution of the will and the
burden to prove otherwise lies on the oppositor. (Art.
800) Bare allegations of duress or influence of fear or
threats, undue and improper influence and pressure,
fraud and trickery cannot be used as basis to deny
the probate of a will. (Baltazar v. Laxa, G.R. No.
174489, April 11, 2012)
Q: What is the legal effect of supervening
capacity or incapacity after the execution of a
will?
A: Supervening capacity or incapacity does not
invalidate an effective will, nor is the will of an
incapable validated by supervening capacity (Art.
801).
FORMS OF WILLS
Q: Compare and contrast notarial and
holographic wills.
A: A notarial or attested will is an ordinary will
acknowledged before a notary public by the testator
and the instrumental witnesses (Art. 805- 806), while
a holographic is a will entirely handwritten, dated,
and signed by the testator himself. (Art. 810)
Regardless of such difference, both wills must be in
writing (Art. 804),and executed in a language or
dialect known to the testator. (Art. 804). Notarial wills
need witnesses whereas holographic wills do not.
Q: May a will be written using the testator’s
blood?
A: Yes. Any form of writing is allowed, as long as the
writing must be understood by others, and it must be
capable of being preserved and with permanence.
Generally, wills are probated after the death of the
testator, so it must have the character of
permanence and clarity.
Q: When is there a presumption that the testator
knows and understands the language or dialect in
which his will is written?
A: There is a presumption if:
1. The will was executed in a language
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generally spoken in the place of execution;
and
2. The testator is a native or resident of such
locality. (Abangan v. Abangan, G.R. No. L-
13431, 1919)
NOTARIAL WILLS
Q: What are the formal requirements for
notarial wills? (Art. 805-806)
1. Subscribed by the testator or his agent in
his presence and by his express direction
at the end thereof, in the presence of the
witnesses;
2. Attested and subscribed by at least three
credible witnesses in the presence of the
testator and of one another;
3. The testator or his agent, must sign every
page, except the last, on the left margin in
the presence of the witnesses;
4. The witnesses must sign every page,
except the last, on the left margin in the
presence of the testator and of one
another;
5. All pages must be numbered correlatively
in letters on the upper part of each page;
6. Attestation clause stating:
a. The number of pages of the will;
b. The fact that the testator or his
agent under his express direction
signed the will and every page
thereof, in the presence of the
witnesses;
c. The fact that the witnesses
witnessed and signed the will and
every page thereof in the presence
of the testator and one another;
7. Acknowledgement before a notary public
Q: When is the rule on substantial compliance
applicable? (Art. 809)
A: The substantial compliance rule is only applicable
to the attestation clause. In the absence of bad faith,
forgery, fraud, undue and improper pressure and
influence, the defects and imperfections in the form
of attestation or in the language used therein shall
not render the will invalid, if it is proved that the will
was in fact executed and attested in substantial
compliance with all the requirements of Art. 805.
(Art. 809)
However, only omissions in the attestation clause
which can be supplied by an examination of the will
itself or by intrinsic evidence will not be fatal to the
validity of the will. The omissions in the attestation
clause which can only be proved by extrinsic
evidence would result in the invalidation of the
attestation clause and ultimately of the will itself.
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CIVIL LAW (AND PRACTICAL EXERCISES)
(Caneda v. CA, G.R. No. L-18076, 1962)
Q: The decedent (A) left 4 children and a wife.
When the will was presented for probate, it was
opposed by B for the will was not executed and
attested as required by law. The will is alleged to
be invalid because of a discrepancy in the
number of pages as the acknowledgement
mentions 7 pages including the ratification and
acknowledgement when in fact it is made up of 8
pages. Is the will valid?
A: No. The rule [on substantial compliance] must be
limited to disregarding those defects that can be
supplied by an examination of the will itself. In this
case, the will actually consists of 8 pages including
its acknowledgment which discrepancy cannot be
explained by mere examination of the will itself but
through the presentation of evidence aliunde. Thus,
the will must be denied for probate. (Lopez v. Lopez,
G.R. No. 189984, 2012)
Q: The attestation clause in the will failed to
mention the number of pages comprising the
will. However, the acknowledgment portion
supplied the omission. Does this substantially
comply with the requirement to have the number
of pages written in the attestation?
A: Yes. When the number of pages was provided in
the acknowledgment portion instead of the
attestation clause, "[t]he spirit behind the law was
served though the letter was not. Although there
should be strict compliance with the substantial
requirements of the law in order to insure the
authenticity of the will, the formal imperfections
should be brushed aside when they do not affect its
purpose and which, when taken into account, may
only defeat the testator's will." (Tanchanco v.
Santos, G.R. No. 204793)
Q: What is the effect of signing before the end of
the will?
A: It invalidates not only the dispositions that come
after, but the entire will, because one of the statutory
requirements would not have been complied with.
(Azuela v. Court of Appeals, G.R. No. 122880, 2006)
Q: What does “in the presence of the testator and
of one another” mean as a requirement for
notarial wills?
A: The true test of presence of the testator and the
witnesses in the execution of a will is not whether
they actually saw each other sign, but whether they
might have seen each other sign, had they chosen
to do so, considering their mental and physical
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condition and position with relation to each other at
the moment of inscription of each signature. The
position of the parties with relation to each other at
the moment of the subscription of each signature,
must be such that they may see each other sign if
they choose to do so, and that there is no physical
obstruction to prevent their doing so. (Nera v.
Rimando, G.R. No. L-5971)
Q: May the notary public also be one of the three
attesting witnesses?
A: No. He must not be one of the three attesting
witnesses. (Cruz v. Villasor, G.R. No. L-32213,
1973)
Q: What are the special requirements for
handicapped testators?
A: The following are the special requirements:
I. For deaf/deaf-mute testator (Art. 807)
1. If able to read — he must read the will
personally
2. If unable to read — he must designate
two persons to read the will and
communicate to him, in some
practicable manner, its contents.
II. For blind testator (Art. 808)
The will shall be read to him twice, once by one
of the subscribing witnesses and another by
the notary public before whom the will is
acknowledged.
The special requirements for handicapped
testators are mandatory; non-compliance with
Articles 807 or 808 will result in nullity and
denial of probate. (Balane, supra)
HOLOGRAPHIC WILLS
Q: What are the requirements for holographic
wills? (EHAND-DS)
A: A holographic will is valid only if it is:
1. Entirely HANDwritten by the testator
2. Dated by him
3. Signed by him (Art. 810; Balane,
supra, p. 130)
Q: Are joint wills allowed in the Philippines?
A: No. A joint will is a document which constitutes the
wills of two or more individuals. Two or more
persons cannot make a will jointly, or in the same
instrument, either for their reciprocal benefit or for the
benefit of a third person. (Art. 818) These kinds of
wills are void.
If there are several documents, each serving as one
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CIVIL LAW (AND PRACTICAL EXERCISES)
independent will, even if they are written on the
same sheet, they are not joint wills. (Balane, supra)
Q: Are joint wills executed by Filipinos abroad
valid?
A: No. It shall not be valid in the Philippines, even
though authorized by the laws of the country where
they may have been executed. (Art. 819) However,
reciprocal wills of foreign nationals jointly probated
in another jurisdiction, can be admitted for reprobate
in the Philippines since the prohibition is in the
making of joint wills, and not on the joint probate of
wills. (Vda. De Perez v. Tolete, G.R. No. 76714,
1994)
WITNESSES TO WILLS
Q: What are the qualifications of a witness to
wills?
A: A witness must be:
1. Of sound mind (Art. 820)
2. At least 18 years of age (Art. 820)
3. Not blind, deaf, or dumb (Art. 820)
4. Able to read and write (Art. 820)
5. Domiciled in the Philippines (Art. 821)
6. Not have been convicted of
falsification of a document, perjury, or
false testimony (Art. 821)
The above qualifications must be possessed at the
time of attesting the will. Their subsequent
incompetence shall not prevent the allowance of the
will. (Art. 822)
CODICILS AND INCORPORATION BY
REFERENCE
Q: What is a codicil?
A: It is a supplement or addition to a will, made after
the execution of a will and annexed, to be taken as
a part of the will. It explains, adds, or alters, any
disposition made in the original will. (Art. 825)
Q: What are the requirements for incorporation
by reference?
A: If a will refers to a document or paper, such
document or paper will be considered a part of the
will if the following requisites concur: (EPPS)
1. The document or paper referred to in the will
must be in Existence at the time of the
execution of the will;
2. The will must clearly describe and identify the
same, stating among other things the number
of Pages thereof;
3. It must be identified by clear and satisfactory
Proof as the document or paper referred to
therein; and
4. It must be Signed by the testator and the
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witnesses on each and every page except in
case of voluminous books of account or
inventories. (Art. 827)
Holographic wills cannot incorporate documents by
reference unless the incorporated paper is also
entirely in the handwriting of the testator. In case of
notarial wills, it is sufficient that the signatures of the
testator and witnesses are on every page of the
incorporated document. (Balane, supra, p. 183)
REVOCATION OF WILLS AND TESTAMENTARY
DISPOSITIONS
Q: What are the modes of revoking a will?
A: A will may be revoked only in the following modes:
(Art. 830) (LSOA)
1. By implication of Law
2. By Subsequent will
3. By Overt Acts, such as burning, tearing,
obliterating, and canceling the will with
intention of revoking it, by the testator himself,
or by some other person in his presence, and
by his express direction.
Q: How is a will revoked by implication of law?
A: The following are forms of revocation (more of
nullification of provisions in the will) by implication of
law:
1. Preterition (Art. 854)
2. Legacy or credit against third person or
remission of debt was provided in will and
subsequently, testator brings action against
debtor (Art. 936)
3. Substantial transformation of specific thing
bequeathed or sale or disposition of property
bequeathed or devised before the death of
the testator (Art. 957)
4. When heir, devisee or legatee commits any
of the acts of unworthiness (Art. 1032)
5. Decree of legal separation revoke
testamentary dispositions in favor of the guilty
spouse (par. 4, Art. 63, Family Code)
6. Annulled or void ab initio marriages revoke
testamentary dispositions made by one
spouse in favor of the other (Art. 50, Family
Code)
7. If both spouses of the subsequent marriage
acted in bad faith, said marriage shall be
void ab initio and testamentary dispositions
made by one in favor of the other are
revoked by operation of law. (Art. 44, Family
Code)
Q: How do subsequent wills revoke previous
ones?
A: Subsequent wills revoke a previous one when
there is a revocatory clause revoking it. If there is
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CIVIL LAW (AND PRACTICAL EXERCISES)
no revocatory clause, only dispositions in the prior
wills which are irreconcilably inconsistent with or
contrary to those contained in the latter wills are
considered revoked. (Art. 831)
Q: What are the requisites of physical destruction
for it to be considered as revocation of a will?
A: The following are the requisites of revocation
by physical destruction:
1. Testamentary capacity at the time of
performing the act of destruction;
2. Intent to revoke (animus revocandi);
3. Actual physical act of destruction; and
4. Performed by the testator himself or by
some other person in his presence and by
his express direction (Art. 830 (3))
Q: What law applies to the revocation?
A: Rules for Revocation (Art. 829)
1. If revocation made in the Philippines –
Philippine law
2. If revocation is made outside the
Philippines and testator is not domiciled in
the Philippines:
a. Law of the place where the will
was made, or
b. Law of the place where the
testator was domiciled at the time
of revocation
3. If revocation is made outside the
Philippines and testator is domiciled in the
Philippines
a. Philippine law
b. Law of the place of revocation
c. Law of the place where the will
was made (Balane, supra, p.
184)
Q: What is the Doctrine of Dependent Relative
Revocation?
A: Revocation made in a subsequent will can only
have legal effects if that subsequent will is
admitted to probate.
In the doctrine of dependent relative revocation, the
first will may be admitted to probate and given effect,
despite it being torn provided that the testator tore it
with the mistaken belief that the second will was
perfectly valid. This is because he would not have
destroyed the first will had he known that second will
is not valid. The revocation is therefore dependent on
the validity of the second will. (Molo v. Molo, G.R.
No. L-2538, 1951)
PROBATE (ALLOWANCE OR DISALLOWANCE OF
WILLS)
Probate – Judicial process of proving:
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1. Compliance with formal requirements of will;
and
2. Testamentary capacity of the testator.
3. Identity of the will (whether the document as
presented in court is indeed the last will of the
testator)
Irrespective of whether its provisions are valid and
enforceable or otherwise. (Fernandez v. Dimagiba,
G.R. No. L-23638, 1967) unless the provisions are
patently void intrinsically (Nepomuceno v. CA)
Q: How is the extrinsic validity of wills proven in
probate proceedings?
A: They are proven as follows:
ATTESTED / NOTARIAL WILLS
Uncontested One subscribing witness only, if
such witness testify that the will
was executed as is
required by law (Rule 76,
Section 5, Rules of Court)
Contested All the subscribing witnesses,
and the notary (Rule 76,
Section 11, Rules of Court)
HOLOGRAPHIC WILLS
Uncontested At least one witness who knows
the handwriting and signature of
the testator explicitly declare that
the will and the signature are in
the handwriting of the testator
(Art. 811)
Contested At least three witnesses who
know the handwriting and
signature of the testator explicitly
declare that the will and the
signature are in the handwriting
of the testator (Art. 811) Expert
witness can be relied upon in
case there are no witnesses who
are familiar with the testator’s
handwriting.
Q: What are the requirements for the probate
of a lost or destroyed will? (Rules of Court, Rule
76, Sec. 5)
1. Establish the execution and validity of the
will
2. Establish that the will is in existence at
the time of death of the testator, or is
shown to have been fraudulently or
accidentally destroyed in the lifetime of
the testator without his knowledge
3. Its provisions must be clearly and
distinctly proved by at least two credible
witnesses
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CIVIL LAW (AND PRACTICAL EXERCISES)
Q: What are the exclusive grounds for
disallowance of wills? (LIF-P-FRAM). Shorter
version – Formalities, Testamentary Capacity,
and Vices of Consent
A: Wills may be disallowed based on:
1. Formalities required by Law were
not complied with;
2. Testator was Insane or incapable of
making a will at the time of execution
(lack of testamentary capacity);
3. The will was executed through Force
or under duress, or the influence of
fear, or threats;
4. The will was procured by undue and
improper Pressure and influence, on
the part of the beneficiary or of some
other person;
5. The testator’s signature was procured
through Fraud; and
6. If the testator acted by Mistake or did
not intend that the instrument he
signed should be his will at the time of
affixing his signature.
Once a will is disallowed because of any of the
following grounds, intestate succession will
ensue.
2. INSTITUTION OF HEIRS
Q: What are the requisites for a valid institution
of an heir?
A: The following are the requisites for a valid
institution of an heir:
1. Designation in the will of person/s to
succeed (Art. 840)
2. The will specifically assigns to such
person an inchoate share in the estate.
3. The person so named has capacity to
succeed.
4. The will is formally valid
5. No vice of consent is present
6. No preterition results from the effect of
such will (Art. 854)
7. The heir is properly named or
identifiable.
Q: What are the presumptions in institution of
heirs?
A: In the absence of specific provisions in the will,
these presumptions will apply: (E-In-S)
(a) Equality – Heirs who are instituted without
designation of shares inherit in equal parts.
(Art. 846)
(b) Individuality – Heirs collectively instituted
are deemed individually named unless a
contrary intent is proven. (Art. 847)
(c) Simultaneity – When several heirs are
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instituted, they are deemed instituted 72, 2006) Total omission includes nothing given in
simultaneously and not successively. (Art. advance to the heir that can be considered as an
849) advance of his legitime.

TREYES v. LARLAR Q: What are the effects of preterition?

A: Preterition shall have the following effects:
Q: The deceased left behind her husband and 1. The institution of heir is annulled.
several siblings, but no children. She left no will. 2. Devises and legacies shall remain valid
The husband executed an Affidavit of Self- as long as they are not inofficious.
Adjudication and transferred the deceased’s If the omitted compulsory heir should die before
estate to himself. The decedent’s siblings then the testator, the institution shall be effectual,
filed a civil case to annul the Affidavit of Self- without prejudice to the right of representation.
Adjudication and recover ownership of their
share of the decedent’s estate. The husband Q: Distinguish preterition from disinheritance.
moved for dismissal, arguing that the
determination of the status of the legal heirs in a
PRETERITION DISINHERITANCE
separate special proceeding is a prerequisite to
an ordinary suit for recovery of ownership and Deprivation of a Deprivation of the
possession of property instituted by the legal compulsory heir of his compulsory of his
heirs. Is the husband correct? legitime is tacit legitime is express
Law presumes that Done with a legal
A: No. Unless there is a pending special proceeding there has been merely cause
for the settlement of the decedent’s estate or for the an oversight or mistake
determination of heirship, the compulsory or on the part of the
intestate heirs may commence an ordinary civil testator
action to declare the nullity of a deed or instrument It results in the The nullity is limited
[in this case the Affidavit of Self-Adjudication by the complete nullity of the to the portion of the
husband], and for recovery of property, or any other institution of heir, estate of which the
action in the enforcement of their ownership rights except the devises and disinherited heir has
acquired by virtue of succession, without the legatees, as long as been legally
necessity of a priori and separate judicial declaration they are not inofficious. deprived.
of their status as such. Even if the Rules of Court Omitted heir gets not If disinheritance is
were to strictly require prior determination of heirship only his legitime but unlawful or
in a separate proceeding as a precondition to the also his share in the ineffective, for
ordinary civil action, the rules must yield to the free portion not absence of one or
specific provisions of the Civil Code that certain disposed of by way of other of the
relatives of the decedent [such as the siblings in this legacies or devises. requisites, the
case] attain their status as either compulsory or compulsory heir is
intestate heirs and that their successional rights are merely restored to
transmitted and enforceable at the very moment of his rightful share.
death. (Treyes v. Larlar, G.R. No. 232579) (Nuguid v. Nuguid,
[IMPORTANT NOTE: This case was cited in the G.R. No. L-23445)
2022 Bar Syllabus]
3. SUBSTITUTION OF HEIRS
Q: What is preterition?
A: Preterition is the total omission of a compulsory Q: What is meant by substitution of an heir?
heir from the inheritance. It consists in the silence A: Substitution is the appointment of another heir so
of the testator with regard to a compulsory heir, that he may enter into the inheritance in default of the
omitting him in his will, either by not mentioning heir originally instituted. (Art. 857)
him at all, or by not giving him anything in the
hereditary property but without expressly Q: Is a substitute subject to the same charges and
disinheriting him, even if he is mentioned in the will conditions Imposed on the original heir?
In the latter case. (Heirs of Ureta v. Ureta, G.R. No. A: Yes. The substitute shall be subject to the same
165748, 2011) charges and conditions imposed upon the instituted
heir, unless and testator has expressly provided the
What constitutes preterition is not mere omission contrary, or the charges or conditions are personally
in the will, but being completely left out of the applicable only to the heir instituted. (Art. 862)
inheritance. (Seangio v. Reyes, G.R. No. 140371-

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Q: What are the classes of substitution?
(a) Vulgar or Simple – The testator may
designate one or more persons to
substitute the heir or heirs instituted in case
such heir or heirs should die before him
(predecease), or should not wish to be
instituted (renunciation) or should be
incapacitated to accept the inheritance
(Art. 859)
(b) Brief - Two or more persons may be
substituted for one person (Art. 860)
(c) Compendious – one person may be
substituted for two or more heirs (Art. 860)
(d) Reciprocal – If heirs instituted in unequal
shares should be reciprocally substituted,
the substitute shall acquire the share of the
heir who dies, renounces, or incapacitated,
unless it clearly appears that the intention
of the testator was otherwise. If there are
more than one substitute, they shall have
the same share in the substitution as in the
institution. (Art. 861)
(e) Fideicommissary Substitution - If the
testator institutes an heir with an obligation
to deliver to another the property so
inherited. The heir instituted to such
condition is called the first heir or fiduciary
heir, the one to receive the property is the
fideicommissary or second heir. (Art. 863)
Q: What are the requisites for a fideicommissary
substitution? (1st-2nd-1-PT- LEx-Free)
1. A fiduciary or a FIRST heir who takes the
property upon the testator’s death. (Art,
863)
2. A fideicommisary or SECOND heir who
takes the property subsequently from the
fiduciary. (Art. 863)
3. The second heir must be ONE degree
from the first heir. Thus, the
fideicommisary can only be a parent or a
child of the fiduciary. (Palacios v. Ramirez,
G.R. No. 27952, 1982)
4. The dual obligation imposed upon the
fiduciary to Preserve the property and to
Transmit it after the lapse of the period to
the fideicommissary heir. (Art. 865)
5. Both heirs must be Living and qualified to
succeed at the time the testator’s death.
6. The fideicommissary substitution must be
Expressly made. (Art. 865)
7. The fideicommissary substitution is
imposed on the Free portion of the estate
and never on the legitime. (Art. 864)
Q: The following shall not take effect: (Art. 867)
1. Fideicommissary substitutions which are
not made in an express manner, either by
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CIVIL LAW (AND PRACTICAL EXERCISES)
giving them this name, or imposing upon
the fiduciary the absolute obligation to
deliver the property to a second heir;
2. Provisions which contain a perpetual
prohibition to alienate, and even a
temporary one, beyond the limit fixed in
Article 863.
3. Those which impose upon the heir the
charge of paying to various persons
successively, beyond the limit prescribed in
Article 863, a certain income or pension;
4. Those which leave to a person the whole or
part of the hereditary property in order that
he may apply or invest the same according
to secret instructions communicated to him
by the testator.
4. CONDITIONAL
TESTAMENTARY
DISPOSITIONS AND
DISPOSITIONS WITH A TERM
Q: What are the prohibited conditions in
testamentary dispositions?
A: The prohibited conditions are: (LIM-Will)
1. Charges, conditions, substitutions, upon
the Legitimes. (Art. 872)
2. Impossible conditions and those contrary
to law or good customs. (Art. 873)
3. An absolute condition not to contract a first
or subsequent Marriage. (Art. 874)
However, if the condition not to contract a
first or subsequent marriage has been
imposed on the widow or widower by the
deceased spouse, or by the latter’s
ascendants or descendants, such
condition is valid. (Art. 874)
4. Disposition Captatoria – Any disposition
made upon the condition that the heir shall
make some provision in his WILL in favor
of the testator or of any other person. (Art.
875)
5. LEGITIMES
Q: What is a legitime?
A: Legitime is that part of the testator’s property
which he cannot dispose of because the law has
reserved it for his compulsory heirs. (Art. 886)
Q: Who are compulsory heirs? (Art. 887)
(a) Legitimate or adopted children
and/or legitimate descendants.
(b) Legitimate parents and/or
ascendants, parents of illegitimate
children.
(c) Surviving spouse
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(d) Illegitimate children and/or descendants Finally, the share of an illegitimate child is ½ of the
share of one legitimate child (Art. 176, Family Code);
Q: What are the general rules in ascertaining hence, Ramon has a legitime of P100,000.
legitimes?
(a) Rule of proximity: The nearer exclude the The parents cannot inherit as they are only
more remote, except when the rule on secondary compulsory heirs, and can inherit only in
representation is proper. (Art. 962) default of legitimate children and descendants (Art.
(b) Legitimate parents or ascendants are 887) or, in the case of illegitimate parents, in default
excluded only by legitimate children. (Arts. of legitimate descendants and illegitimate children
896, 899) (Art. 903). As Emil has legitimate children, the
(c) Parents of illegitimate children are parents cannot inherit. Furthermore, his brother and
excluded by both legitimate and illegitimate sister are not entitled to a legitime, as they are not
children. (Art. 903) compulsory heirs (Art. 887).
(d) The illegitimate ascending line does not go
beyond the parents. (Art. 903; Balane, The remaining free portion of his estate, then, will be
supra, p.345) P300,000. Emil would be free to leave the entire
(e) In the direct ascending line, there is the rule P300,000 to Ramon in his will.
of division by line. The legitime is divided
equally between the paternal and maternal
side. After the portions corresponding to
the line has been assigned, there will be
equal apportionment between or among
the recipients within the line, should there
be more than one. (Art. 890)
(f) There is no right of representation in the
direct ascending line. (Art. 972)

For a surviving spouse to inherit from the deceased,

the marriage between the decedent and the
widow/widower must be either valid or voidable.
(Balane, supra, p.341)

Q: Emil, the testator, has three legitimate

children, Tom, Henry and Warlito; a wife named
Adette; parents named Pepe and Pilar; an
illegitimate child, Ramon; brother, Mark; and a
sister, Nanette. Since his wife Adette is well-off,
he wants to leave to his illegitimate child as much
of his estate as he can legally do. His estate has
an aggregate net amount of P1,200,000.00, and all
the above-named relatives are still living. Emil
now comes to you for advice in making a will.
How will you distribute his estate according to
his wishes without violating the law on
testamentary succession? (2005 Bar)

A: Compute for the legitimes of each.

First, legitimate children have a legitime equal to ½

of the estate (Art. 888). P600,000 should go to Tom,
Henry, and Warlito, to be divided equally among
them. Each legitimate child, then, will have
P200,000 each as legitime.

The spouse Adette has a legitime equal to the share

of one legitimate child (Art. 892, NCC). Hence, she
is entitled to receive P200,000.

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DIFFERENT COMBINATIONS OF SHARES OF COMPULSORY HEIRS

(Art. 888-903)
HEIR LEGITIME FREE
PORTION
Legitimate Children & 1/2 1/2
Descendants
Legitimate Children (LC) & Legitimate Children – 1/2 Whatever
Surviving Spouse remains
Spouse – Equal to share of 1 LC

One Legitimate Child/Descendant & Child/Descendant – 1/2 1/4

Surviving Spouse
Legitimate Children (LC)
Illegitimate Children (ILC)
Legitimate Children/Descendants,
Surviving Spouse & Illegitimate
Children
One Legitimate Child, Illegitimate
Children & Surviving Spouse
Spouse – 1/4
Legitimate Children -1/2 Whatever
& remains
Illegitimate Children – 1/2 of share of 1 LC as may be
accommodated, otherwise reduce proportionately
LC –1/2
Spouse – equal to 1 share of 1 LC Whatever
ILC – 1/2 of share of 1 LC as may be accommodated, remains
otherwise reduce proportionately
LC – 1/2
ILC – 1/2 of share of 1 LC as may be Whatever
accommodated, otherwise reduce proportionately remains
Spouse –1/4 of estate

Parents & Ascendants of

Legitimate Children 1/2 1/2

Parents/Ascendants of Legitimate Parents/Ascendants – 1/2

Legitimate Children & Illegitimate 1/4
Children Illegitimate Children – 1/4

Parents/Ascendants of Legitimate Parents/Ascendant – 1/2

Legitimate Children & Surviving
Spouse Spouse – 1/4 1/4

Parents/Ascendants of Parents/Ascendants –1/2

Legitimate Children, Illegitimate ILC –1/4 1/8
Children & Surviving Spouse, Spouse – 1/8
General Rule or If in artiuculo mortis, but cohabited for
more than 5 years – 1/2 1/2
Surviving Spouse Only
1/3 if in articulo mortis 2/3

ILC – 1/3
Surviving Spouse & Illegitimate 1/3
Children Spouse – 1/3

Surviving Spouse & Parents Of Spouse – 1/4 1/2

Illegitimate Children Parents – 1/4
Illegitimate Children Only 1/2 1/2
Parents Of Illegitimate Children 1/2 1/2

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Q: What is Reserva Troncal?
A: It is the reservation by virtue of which an
ascendant who inherits from his descendant any
property which the latter may have acquired by
gratuitous title from another ascendant or a brother
or sister, is obliged to reserve the property for the
benefit of relative within the third degree and who
belong from the same line from which the property
came from. (Art. 891)
Q: What are the requisites of Reserva Troncal?
(GWOT)
1. The property was acquired by a person
(Prepositus) from an ascendant or from a
brother or sister (Origin) by Gratuitous title
(either by donation, or by any kind of
succession)
2. The said descendant died Without issue;
3. The property is inherited by another
descendant (Reservista) by Operation of
law (either by compulsory succession, or by
intestate succession);
4. There are relatives within the Third degree
(Reservatarios) belonging to the line from
which the said property came. (Chua v.
Court of First Instance, G.R. No. L-29901,
1977)
Q: What is the order of preference among
reservatarios?
A: Upon the death of the ascendant reservista, the
reservable property should pass, not to all the
reservatarios as a class, but only to those nearest in
degree to the descendant (prepositus), excluding
those reservatarios of more remote degree. The
reserva troncal merely determines the group of
relatives to whom the property should be returned;
but within that group the individual right to the
property should be decided by the applicable rules
of ordinary intestate succession, since Art. 891 does
not specifiy. (Padura v. Baldovino, G.R. No. 11960,
1958)
Q: How is Reserva Troncal extinguished?
A: Reserva Troncal is extinguished through:
1. The death of the reservista
2. The death of all the reservatarios;
3. Renunciation by all theres ervatarios,
provided that no other reservatario is born
subsequently;
4. Total fortuitous loss of the reserved
property;
5. Confusion or merger of rights, as when the
reservatarios acquire the reservista’s right
by contract inter vivos; (Balane, supra)
6. Prescription or adverse possession.
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CIVIL LAW (AND PRACTICAL EXERCISES)
(Balane, supra)
Q: Distinguish the obligations and rights of
the fiduciary (first heir) in a
fideicommissary substitution from those
of a reservista in a reserva troncal.
A: The fiduciary has ownership rights over the
property given him by the testator but is legally
obliged to preserve and transmit the property
to the fideicommissary heir.
On the other hand, a reservista has complete
dominion over the property inherited from a
prepositus or descendant, but the reservista’s
ownership over the thing is subject to a
resolutory condition that upon his death the
property shall be given to the relatives of his
descendant within the third civil degree. He is
also obliged to inventory the properties,
annotate the reversible character in the RD, if
registered immovables, within 90 days from
acceptance, appraise the movables, and
secure by means of mortgage the (a)
indemnity for any determination of, or damage
to, the property occasioned by the reservista’s
fault or negligence, and (b) the payment of the
value of such reserved movables, as may
have been eliminated by the reservista.
(Compare Art. 838 with 891; Riosa v. Rocha,
1996)
Q: A died intestate. All his properties were
inherited by his minor son, B, and A’s
widow, C. Two years later, C died intestate.
Then, B died intestate. B was succeeded
by B’s maternal aunt, D. D obtained
possession of the properties left by B. B’s
paternal cousins filed a case seeking
recovery of possession of the properties
inherited by D from B, on the theory that
these are reserved properties. Will the
recovery prosper?
A: No. There is no reserva troncal in this case.
Reserva troncal contemplates a situation
where the person reserving the property
(reservista) is an ascendant of the prepositus
(B). D is not a direct ascendant of B because
she is only a collateral relative. Furthermore,
B’s cousins are not relatives within the third
civil degree of the prepositus. (Mendoza v.
Delos Santos, 2013)
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6. DISINHERITANCE
Q: What are the requisites for valid
disinheritance? (WET2-LUP)
1. Effected only through a valid Will (Art. 916)
Its counterpart in intestate succession is
unworthiness.
2. For a cause Expressly stated in the will
(Art. 916, 918)
3. Cause must be certain and True (Art. 918)
4. Total;
5. It must be for a cause expressly stated
by Law (Art. 916, in relation to Art. 919-
921)
6. Unconditional;
7. If the truth of the cause is denied, it must
be Proved by the proponent. (Art. 917)
Q: What are the effects of disinheritance?
1. Total exclusion of the compulsory heir
from the inheritance, which includes his
legitime, his share in the intestate
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CIVIL LAW (AND PRACTICAL EXERCISES)
portion, and any testamentary
disposition made in a prior will. (Balane,
supra)
2. The children or descendants of the
person disinherited shall take his or her
place and shall preserve the rights of
compulsory heirs with respect to the
legitime. (Art. 923)
3. The disinherited parents shall not have
the usufruct or administration of the
property which constitutes the legitime.
(Art. 923)
Q: What is ineffective disinheritance?
A: Disinheritance without specification of the
cause, or for a cause the truth of which, if
contradicted, is not proved, or which is not one of
those set forth in this Code, shall annul the
institution of heirs insofar as it may prejudice the
person disinherited; but the devises and legacies
and other testamentary dispositions shall be valid
to such extent as will not impair the legitime. (Art.
918)
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SUMMARY OF GROUNDS FOR DISINHERITANCE (ARTS. 919, 920 & 921)

GROUND CHILD/ PARENT/ SPOUSE

DESCENDANT ASCENDANT
Attempt against the life of the testator, √ √ √
spouse, ascendant, descendant
Accusation of a crime with penalty of six √ √ √
years
Adultery and Concubinage with the √ √ N/A
spouse of testator
Induce testator to make/change the will. √ √ √

Support unjustifiably refused √ √ Unjustifiable refusal to

support the children or
the other spouse
Maltreatment of the testator by word or √ N/A N/A
deed
Leading a dishonorable or disgraceful √ N/A N/A
life
Conviction of a crime which carries with √ N/A N/A
the penalty of civil interdiction
Abandonment of Children, N/A √ N/A
Inducement to live a corrupt or moral
life, or attempted against their virtue
Loss of parental authority N/A √ It is sufficient that the
spouse has given
grounds for loss of
parental authority
Attempt by one Parent against the Life of N/A √ N/A
the Other
Giving Cause for Legal Separation N/A N/A √

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Q: Distinguish ineffective disinheritance from A: If the inheritance should be repudiated by the

preterition.
INEFFECTIVE PRETERITION
DISINHERITANCE
Person disinherited may The person omitted
be any compulsory heir must be a inheritance. (Art. 969)
compulsory heir in
the direct line
Express Implied
Intentional Either intentional or
unintentional
Partial annulment of Effect: Total
institution of heirs annulment of
institution of heirs
7. LEGACIES AND DEVISES
Q: Distinguish legacy from a devise.
A: A legacy is a testamentary disposition of
personal property by particular title, while a devise
is a testamentary disposition of real property by
particular title. (Balane, supra)
C. LEGAL OR INTESTATE
SUCCESSION
1. GENERAL PROVISIONS
Q: What are the instances when legal or
intestate succession operates?
1. If a person dies without a will, or with a
void will, or one which has subsequently
lost its validity; (Art. 960)
2. When the will does not institute an heir to,
or dispose of all the property belonging to
the testator. In such case, legal
succession shall take place only with
respect to the property of which the
testator has not disposed; (Art. 960)
3. If the suspensive condition attached to the
institution of heir does not happen or is not
fulfilled, or if the heir dies before the
testator, or repudiates the inheritance,
there being no substitution, and no right of
accretion takes place; (Art. 960)
4. When the heir instituted is incapable of
succeeding, except in cases provided in
the Civil Code; (Art. 960)
5. Happening of a resolutory condition;
6. Expiration of a resolutory term;
7. Preterition (Balane, supra)
nearest relative, should there be one only, or by all
the nearest relatives called by law to succeed,
should there be several, those of the following
degree shall inherit in their own right and cannot
represent the person or persons repudiating the
Q: What is Representation?
A: It is a right created by fiction of law, by virtue of
which the representative is raised to the place and
the degree of the person represented, and acquires
the rights which the latter would have if he were
living or if he could have inherited. (Art. 970;
Tumbokon v. Legaspi, G.R. No. 153736, 2010) In
order that representation may take place, it is
necessary that the representative himself be
capable of succeeding the decedent. (Art. 973)
Representation only applies in testamentary
succession in the direct descending line and in
intestate succession in the direct descending line
(Art. 972) and in one instance in the collateral line in
the case of nephews and nieces representing
brothers and sisters of the deceased (Art. 975)
There is no representation in the direct ascending
line. (Paras, supra)
Q: When does representation set in? (PID)
1. Predecease;
2. Incapacity or unworthiness;
3. Disinheritance (Paras, supra)
Representation does not apply in
renunciation. (Art. 977)
2. ORDER OF INTESTATE
SUCCESSION
Q: What is the Iron Curtain Rule / Barrier
Principle / Principle of Absolute Separation?
A: An illegitimate child has no right to inherit ab
intestato from the legitimate children and relatives
of his father or mother; nor shall such children or
relatives inherit in the same manner from the
illegitimate child. (Art. 992)
The right of representation is not available to
illegitimate descendants of legitimate children in
the inheritance of a legitimate grandparent. (Diaz v.
Intermediate Appellate Court, G.R. No. L- 66574,

Q: When does renunciation set in? What are its

effects?

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1990) 1

PERSON TO BE REPRESENTED
ILLEGITIMATE LEGITIMATE CHILD
CHILD
His or her Only his or her
descendant whether legitimate descendants
legitimate or can represent him, his
illegitimate, may or her illegitimate
represent him. Descendants cannot
represent him. (Vda.
De Crisologo v. Cam
G.R. No. L-44051,
1985)

1
Note the potential effects of Aquino v. Aquino, G.R. Nos. however, was promulgated on December 7, 2021, beyond
208912 and 209018, on the Iron Curtain Rule. The decision, the cut-off date of June 30, 2021 for the 2022 Bar coverage.

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COMBINATIONS OF LEGITIMES AND INTESTATE SUCCESSION

(Arts. 888-889, 892-901, 903, 983, 986-987, 991, 993-1001, 1004-1008, 1011)

HEIRS LEGITIME INTESTACY TOTAL

Legitimate Children 1/2 divided equally 1/2 divided Whole estate divided
Alone equally equally
Legitimate Children and LC – 1/2 divided equally Residue left Whole estate divided among
Illegitimate Children divide among them, observing the 2:1 ratio
ILC – 1/2 of share of 1 them, observing
LC the 2:1 ratio
Legitimate Children LC – 1/2 divided equally Residue left shall Whole estate divided
and Surviving Spouse be divided among equally
Spouse – Share of 1 LC them equally
One Legitimate Child LC – 1/2 1/4 goes to the LC – 1/2
and Surviving Spouse spouse
Spouse – 1/4 Spouse – 1/2

Legitimate Children, LC – 1/2 Residue left shall Whole estate divided among
Surviving Spouse, Spouse – share of 1 LC be divided among them, observing the 2:1 ratio
Illegitimate Children ILC – 1/2 of share of 1 them, observing
LC the 2:1 ratio
Legitimate Parents LP – 1/2 1/2 goes to the Whole estate divided
Alone parents equally
Legitimate Ascendants 1/2 1/2 Whole estate divided among
Other them, observe rules in
than Parents proximity in degree, and
division by line
Legitimate Parents and LP – 1/2 1/4 goes to the LP – 1/2
Illegitimate Children illegitimate
ILC – 1/4 children ILC – 1/4

Legitimate Parents LP – 1/2 1/4 goes to the LP – 1/2

and Surviving Spouse spouse
Spouse – 1/4 Spouse – 1/2

Legitimate Parents, LP – 1/2 1/8 goes to the LP – 1/2

Surviving Spouse, and spouse
Illegitimate Children ILC – 1/4 ILC – 1/4
Spouse – 1/8 Spouse – 1/4
Illegitimate Children ILC – 1/2 1/2 goes to Whole estate divided
Alone illegitimate equally
children
Illegitimate Children ILC – 1/3 1/6 goes to ILC – 1/2
and Surviving Spouse illegitimate
children
Spouse – 1/3 1/6 goes to Spouse – 1/2
spouse

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(continuation)

HEIRS LEGITIME INTESTACY TOTAL

Surviving Spouse 1/2 Residue goes to the Whole estate goes to the spouse
Alone 1/3 if marriage is spouse
in articulo mortis
Surviving Spouse Spouse – 1/4 1/ 4 goes to the Spouse 1/2
and Parents of spouse
Illegitimate Parents of 1/4 goes to the Parents of Illegitimate Children – ¼
Children Illegitimate parents of illegitimate
Children – 1/4 children
Surviving Spouse Spouse – 1/2 1/2 goes to the Spouse – 1/2
and Legitimate legitimate brothers
Brothers and and sisters, nephews
Sisters, Nephews and nieces Legitimate brothers and sisters,
and Nieces nephews and nieces – 1/2

Surviving Spouse Spouse – 1/2 1/2 goes to the Spouse – 1/2

and Illegitimate illegitimate brothers
Brothers and and sisters, nephews
Sisters, Nephews and nieces Legitimate brothers and sisters,
and Nieces nephews and nieces – 1/2
Parents of 1/2 1/2 goes to the Whole estate divided equally
Illegitimate parents of illegitimate
Children Alone children
Parents of Any kind of 1/2 goes to the any Whole estate goes to the children,
Illegitimate children – 1/2, kind of children, observing 2:1 ratio, if applicable
Children and observe 2:1 observe 2:1 ratio Parents of illegitimate children are
Children of Any ratio excluded by all kinds of children
Kind

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(continuation)

HEIRS LEGITIME INTESTACY TOTAL

Legitimate Brothers
and Sisters Alone
Legitimate Brothers and
Sisters, Nephews and
Nieces
Nephews and Nieces
with Uncles and Aunts
Illegitimate Brothers
and Sisters Alone
Illegitimate Brothers
and Sisters, Nephews
and Nieces
Nephews and Nieces
Alone
Other Collaterals up to
the Fifth Degree
State
N/A Whole estate divided among them, observing the 2:1 ratio for
full-blood and half-blood siblings
N/A Whole estate divided among them, observing the 2:1 ratio for
full-blood and half-blood siblings
Apply rules on representation when proper
N/A Whole estate divided among nephews and nieces, observing
the 2:1 ratio for full-blood and half-blood siblings
Uncles and aunts of the decedent are excluded. (Bacayo v.
Borromeo)
N/A Whole estate divided among them, observing the 2:1 ratio for
full-blood and half-blood siblings
N/A Whole estate divided among them, observing the 2:1 ratio for
full-blood and half-blood siblings
N/A Whole estate divided among them, observing the 2:1 ratio for
full-blood and half-blood siblings
N/A Whole estate divided equally, observe rules in proximity in
degree
N/A (Resident Decedent) (Non-Resident Decedent)
Personal property – Personal property and real
Municipality of the last property –Municipality where
residence it is situated
Real property – Municipality
where it is situated

Property is to be used for the benefit of public education and

charitable institutions in the respective municipalities or cities, or
alternatively, at the instance of an interested party, or motu
proprio, court may order creation of a permanent trust for the
benefit of the institutions concerned.

D. PROVISIONS COMMON TO
TESTATE AND INTESTATE A: Both a natural person and a juridical person
SUCCESSION may inherit. (Art. 1026) In order to be
capacitated to inherit, the heir, devisee or
legatee must be living at the moment the
1. RIGHT OF ACCRETION succession opens, except in case of
representation, when it is proper. (Art. 1025,
Q: What is Accretion?
par 1) The heir, legatee/devisee must not be
A: Accretion is the right by virtue of which, when two incapacitated or disqualified by law to
or more persons are called to the same inheritance, succeed. (Art. 1024, par. 1)
devise or legacy, the part assigned to the one who A child already conceived at the time of
renounces or cannot receive his share, or who died the death of the decedent is capable of
before the testator, is added or incorporated to that succeeding provided it be born later
of his co-heirs, co- devisees, or co-legatees. (Art. under the conditions prescribed in Article
1015) 41 of the Civil Code. (Art. 1025, par 2)
2. CAPACITY TO SUCCEED BY The State, provinces, municipal
WILL OR BY INTESTACY corporations, private corporations,
organizations, or associations for
Q: Who may inherit?

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religious, scientific, cultural, educational,
or charitable purposes, and all other
corporations or entities may succeed
under a will, unless there is a provision to
the contrary in their charter or the laws of
their creation, and always subject to the
same. (Art. 1026)
3. ACCEPTANCE AND
REPUDIATION OF
INHERITANCE
Q: When should acceptance or repudiation
be made?
A: Within 30 days after the court has issued
an order for the distribution of the estate the
heir, devisee, or legatee shall signify to the
court having jurisdiction whether they accept
or repudiate the inheritance. If they do not do
so within that time, they are deemed to have
accepted the inheritance. (Art. 1057)
Q: How should repudiation be done? (Art.
1051)
A: The repudiation of the inheritance shall be
made in:
1. A public document signed before a
notary public, or
2. Authentic instrument – equivalent
to an indubitable writing or a writing
whose authenticity is admitted or
proved, or
3. By a petition presented to the court
having jurisdiction over the
testamentary or intestate
proceedings.
COLLATION
Q: What is collation?
A: Collation is the act of bringing back to the
estate properties acquired inter vivos and
gratuitously from decedent (if acquired by will,
e.g. legacies and devises, they are not
collatable, but may be reduced for being
inofficious).
Every compulsory heir, who succeeds with
other compulsory heirs, must bring into the
mass of the estate any property or right which
he may have received from the decedent,
during the lifetime of the latter, by way of
donation, or any other gratuitous title, in order
that it may be computed in the determination
of the legitime of each heir, and in the account
of the partition. (Art. 1061)
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CIVIL LAW (AND PRACTICAL EXERCISES)
However, donations inter vivos to compulsory heirs
shall not be imputed to the legitime:
1. If the donor expressly provided; (Art.
1062)
2. The donee repudiated the inheritance;
(Id.)
3. The value of donation exceeds the
donee’s legitime
NOTE: The donation will be imputed to the legitime
to the extent of the legitime’s value, and the excess
to the free portion. (Balane, supra at p. 577)
Q: What properties should be collated?
A: The properties to be collated are: (GED)
1. Property or right received by
Gratuitous title during the testator’s
lifetime. (Art. 1061)
2. Expenses incurred by the parents in
giving their children a professional,
vocational or other career, only if the
parents provide that the expenses be
brought to collation or if the expenses
impair the legitime. If these expenses
are collated, the sum which the child
would have spent if he had lived in the
house and company of his parents
shall be deducted from the value of the
expenses. (Art. 1068)
3. Any sums paid by a parent in
satisfaction of the Debts of his
children, election expenses, fines,
and similar expenses. (Art. 1069)
4. PARTITION AND
DISTRIBUTION OF THE
ESTATE
Q: What is partition? (Art. 1079, 1082)
A: It is the separation, division and assignment of a
thing held in common among those to whom it may
belong. It includes every act which is intended to put
an end to indivision among co- heirs, and legatees
or devisees, although it should purport to be a sale,
exchange, compromise, or any other transaction. It
is not subject to any form.
Q: Who may effect partition?
1. Decedent himself during his lifetime
by an act inter vivos or by will (Art.
1080)
2. Heir themselves (Art. 1083)
3. Competent court (Art. 1083)
4. Third person designated by the
decedent
(Art. 1081)
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Q: May partition be rescinded?
A: A partition, judicial or extra-judicial, may
be rescinded on account of lesion, when any
one of the co-heirs received things whose
value is less, by at least one-fourth, than the
share to which he is entitled, considering the
value of the things at the time they were
adjudicated. (Art. 1098)
However, the omission of one or more
objects or securities of the inheritance shall
not cause the rescission of the partition on
the ground of lesion, but the partition shall be
completed by the distribution of the objects or
securities which have been omitted. (Art.
1103)
IV. OBLIGATIONS AND CONTRACTS
A. OBLIGATIONS
1. GENERAL PROVISIONS
Q: What is an Obligation?
A: An obligation is a juridical necessity to give, to
do or not to do. (CIVIL CODE, art. 1156)
Q: What are the essential elements of an
obligation? (CIVIL CODE, arts. 1156 – 1162)
(PAVO)
1. Passive Subject (obligor/debtor): person who
has the duty of giving, doing or not doing;
person bound to the fulfillment
2. Active Subject (obligee/creditor): person in
whose favor the obligation is constituted;
person entitled to make a demand
3. Vinculum Juris/ Legal Tie: the efficient cause or
the juridical tie between two subjects by reason
of which the debtor is bound in favor of the
creditor to perform the obligation. It can be
established by various sources of obligations
(law, contract, quasi-contracts, delicts, and
quasi-delicts) and may arise either from bilateral
or unilateral acts of persons.
4. Object/ Subject Matter: the prestation or
conduct which has to be observed by the
debtor/obligor; to be valid, it must be:
(LiPoDeM):
a. Licit
b. Possible
c. Determinate/ Determinable
d. Must have pecuniary value
(Desiderio P. Jurado, Comments and Jurisprudence
on Obligations and Contracts 457 (2010))
Q: What are the sources of obligations? (L-
CQAQ)
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CIVIL LAW (AND PRACTICAL EXERCISES)
1. Law;
2. Contracts;
3. Quasi-contracts;
4. Acts or omissions punished by law; and
5. Quasi-delicts (CIVIL CODE, art. 1157)
NOTE: The list is exclusive. (Sagrado Orden v.
Nacoco, G.R. No. L-3756, 1952)
Q: When may a quasi-delict be used as a cause
of action despite a pre-existing contractual
relation?
A: General Rule: Actions based on breach of
contract and actions based on quasi-delicts differ in
terms of conditions, defenses, and proof. They
cannot co-exist. (Orient Freight v. Keihin, G.R. No.
191937, 2017)
Exceptions:
1. When the same act which constitutes a breach
of the contract would have constituted the
source of an extra-contractual obligation had no
contract existed between the parties (Cangco v.
Manila Railroad Co., G.R. No. L-12191, 1918);
2. If the act that breaks the contract may also be a
tort (Air France v. Carrascoso, G.R. No. L-
21438, 1966).
When the obligation is based on a contract, without
which the obligation does not exist, the cause of
action must be founded on the breach of contract
and cannot be based on quasi-delict (PSBA v. Court
of Appeals, G.R. No. 84698, 1992).
In Air France, what was punished was the
company’s racist policy which emboldened the
manager to expel the Filipino from first class
because a white man had a better right to the seat.
Air France would apply if the act which breaches a
contract was done in bad faith and amounts to a
violation of Article 21 of the Civil Code.
2. Nature and Effect
Q: What are the requisites to be in legal
delay/default?
1. Obligation is Demandable
2. Debtor Delays performance
3. Creditor Demands performance judicially or
extrajudicially (CIVIL CODE, art. 1169)
Q: Can demand in Article 1169 be made
judicially?
A: Yes. Default or mora, which is a kind of voluntary
breach of an obligation, signifies the idea of delay in
the fulfillment of an obligation with respect to time.
In positive obligations, like an obligation to give, the
obligor or debtor incurs in delay from the time the
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obligee or creditor demands from him the fulfillment
of the obligation. Demand may be judicial — if the
creditor files a complaint against the debtor for the
fulfillment of the obligation — or extrajudicial — if the
creditor demands from the debtor the fulfillment of
the obligation either orally. or in writing.
Whether the demand is judicial or extrajudicial, if the
obligor or debtor fails to fulfill or perform his
obligations, like payment of a loan, as in this case,
he is in mora solvendi, and, thus, liable for damages.
(CASET v. Province of Camarines, G.R. 199666,
2019)
Q: Once the obligor incurs in delay, is he liable
for payment of interest as an indemnity for
damages?
A: Yes. If the obligation consists in the payment of
a sum of money, and the debtor incurs in delay, the
indemnity for damages, there being no stipulation to
the contrary, shall be the payment of the interest
agreed upon, and in the absence of stipulation, the
legal interest, which is six per cent per annum.
(Rivera v. Spouses Chua, G.R. No. 184458, 2015)
Q: What are the four (4) instances when demand
is not necessary to constitute the debtor in
default? (ELTU)
1. When there is an Express stipulation to that
effect;
2. Where the Law so provides;
3. When Time is of the essence; and
4. Where the demand would be Useless.
In the first two, it is not sufficient that the law or
obligation fixes a date for performance; it must
further state expressly that after the period lapses,
default will commence. (CIVIL CODE, art. 1169)
Q: What are the requisites of Fortuitous Events?
(NIIU)
1. Event must be Independent of obligor’s will;
2. Event is Unforeseeable or unavoidable
3. Such event renders it Impossible for the debtor
to perform (not only makes it difficult, but
impossible)
4. No contributory negligence (Lasam v. Smith,
G.R. No. L-19495, 1924)
General rule: Loss due to fortuitous events shall
extinguish the obligation. (CIVIL CODE, art. 1174)
Exceptions: (SALTD-G)
1. If by Law the obligor is liable even for fortuitous
event
2. If by Stipulation the obligor is liable even for
fortuitous event
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CIVIL LAW (AND PRACTICAL EXERCISES)
3. If the nature of the obligation requires the
Assumption of the risk (CIVIL CODE, art. 1174)
4. If the loss of the thing occurs after the obligor
incurred in Delay; and
5. If the obligor promised to deliver the same thing
to Two or more persons who do not have the
same interest (CIVIL CODE, art. 1165)
6. If the thing to be delivered is Generic
Q: A’s warehouse was razed by fire. It had a
long-term supply contract for 10 years to deliver
sugar to X, which provides that the former will
deliver to the latter sugar every so often. Due to
the fire, A was not able to make deliveries for a
period of 1 year during the 10-year period. Can
A be compelled to deliver sugar on the 11th year
considering its failure to comply with its
obligation for 1 year?
A: No. The occurrence of such a fortuitous event will
not extend the period of the contract beyond its fixed
period. This is because the obligor was excused
from performance during the period when the
fortuitous events prevented it from performing its
obligations. (Victorias Planters Association v.
Victorias Milling, G.R. No. L-6648, 1955)
3. KINDS
Q: What are Pure Obligations?
A: It is an unqualified obligation, which is
demandable immediately. Its performance does
NOT depend upon a future and uncertain event, or
past event unknown to the parties. (CIVIL CODE,
art. 1179)
Q: What are conditional obligations?
A: Conditional obligations are obligations the
fulfillment of which depends upon a (1) future AND
uncertain event, (2) or upon a past event unknown
to the parties. (HECTOR S. DE LEON & HECTOR
M. DE LEON, JR., COMMENTS AND CASES ON
OBLIGATIONS AND CONTRACTS 106 2014)
Q: What is a potestative condition?
A: It is a condition that is dependent on the sole will
of a party. A potestative suspensive condition
dependent on the sole will of the debtor is void. If it
is potestative resolutory, it is valid. (EDGARDO L.
PARAS, CIVIL CODE OF THE PHILIPPINES ANNOTATED:
PRESCRIPTION; OBLIGATIONS AND CONTRACTS 201
2016)
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Q: What is the difference between a Contract to period is to be fixed by the court, taking into
Sell and a Conditional Contract of Sale? account intention of the parties
CONDITIONAL (ERNESTO L. PINEDA, OBLIGATIONS AND
CONTRACT TO SELL CONTRACT OF CONTRACTS 129 (2009))
SALE
The efficacy or obligatory force of the vendor's Q: What is the difference between suspensive
obligation to transfer title is subordinated to the or resolutory condition and term or period?
happening of a future and uncertain event, so
that if the suspensive condition does not take CONDITION TERM or
place, the parties would stand as if the PERIOD
conditional obligation had never existed. Suspensive It may or may It is certain
The fulfillment of the The fulfillment of the not happen, that it will
suspensive condition suspensive condition hence uncertain happen; just
will not automatically renders the sale whether there is uncertain as
transfer ownership to absolute and the an obligation to when it will
the buyer although the previous delivery of happen.
property may have the property has the Resolutory It is not certain It is certain
been previously effect of automatically if the obligation that it will
delivered to him. transferring the seller's will terminate at terminate at a
ownership or title to all. future time.
The prospective seller the property to the (DE LEON191 (2014))
still has to convey title buyer.
to the prospective Q: When shall a debtor/obligor lose the benefit
buyer by entering into of the period (therefore may be compelled to
a contract of absolute pay immediately)? (FAt-VISA):
sale. 1. Debtor becomes Insolvent (when his assets are
(Villamil v. Sps. Erguiza. G.R. 195999, 2019) less than his liabilities) AFTER the debt has
been contracted.
Q: What is the principle of constructive
fulfillment of a condition? Exception: When he gives security for the
A: When the obligor voluntarily or intentionally obligation
prevents the fulfillment of the condition, the
condition shall be deemed fulfilled. (CIVIL CODE, art. 2. Failure to create or establish the security
1186) promised;
3. When Security established but is later impaired
Q: What are the requisites of the Principle of (through fault of debtor) or totally lost (due to
Constructive Fulfillment under Article 1186? fault of debtor or fortuitous events).
1. The intent of the obligor to prevent the fulfillment
of the condition; Exception: When debtor provides another security
2. Actual prevention of the fulfillment of equal value;

NOTE: Mere intention of the debtor to prevent the
happening of the condition, or to place ineffective
obstacles to its compliance, without actually
preventing the fulfillment, is insufficient. (Villamil v.
Sps. Erguiza. G.R. 195999, 2019)
Q: What are obligations with a Term or Period?
A: These are obligations which are demandable on
a "day certain”.
Q: What does a “day certain” refer to in
obligations with a period or a term?
A: “Day certain” refers to either:
1. A future AND certain event; or
2. Payable when able, or when debtor promises to
pay when “his means permit him to do so” –
4. Violation of any undertaking on the basis of
which, period is granted;
5. Debtor Attempts to abscond (mere attempt
sufficient, because if actual abscondment is to
be awaited, creditor can no longer collect); and
6. With an Acceleration clause stipulation
Applies to obligations payable in installments or
based on amortization schedule, where stipulation
says that failure to pay one or some installments or
amortizations will entitle creditor to accelerate
payment – i.e., to call for the payment on the entire
remaining unpaid obligation. (CIVIL CODE, art. 1198)
Q: What are reciprocal obligations?
A: Reciprocal obligations are those that arise from
the same cause, and in which each party is a debtor

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and a creditor of the other at the same time, such
that the obligations of one are dependent upon the
obligations of the other. They are to be performed
simultaneously, so that the performance by one is
conditioned upon the simultaneous fulfillment by the
other. Furthermore, neither party incurs in delay if
the other does not comply or is not ready to comply
in a proper manner with what is incumbent upon
him. From the moment one of the parties fulfills his
obligation, delay by the other begins. (CIVIL CODE,
art. 1169)
of indemnity for damages. Innocent joint debtor shall
not contribute to the indemnity beyond their
corresponding share of the obligation. (CIVIL CODE,
art.1224)
Q: What is the rule on solidary obligations?
A: It must be expressed in stipulation or provided by
law or by nature of obligation. Otherwise, it will be
considered a joint obligation/credit. The
presumption is that an obligation is always joint.
(CIVIL CODE, art.1207)

Q: When does the obligation arise in the Words denoting solidarity include “jointly and
following: severally” (most common); “individually and
1. Pure obligation: Upon demand (CIVIL CODE, collectively”; “severally”; “individually”; “collectively”;
art. 1179) “separately”; “distinctively”, “individually liable” and
2. Obligations with Suspensive Condition “individually and jointly”. (Ronquillo v. Court of
Appeals, G.R. No. L-55138, 1984)
General Rule: Only from the time the condition is
fulfilled, but the obligation retroacts to the day of Q: Distinguish Indivisibility from Solidarity.
its constitution. (CIVIL CODE, art. 1187)
INDIVISIBILITY SOLIDARITY
Exception: Regarding fruits and interests in Refers to the Refers to the legal tie
reciprocal obligations (even if the two reciprocal prestation which and consequently to
obligations are not of the same value), the parties constitutes the object the subjects or parties
are deemed as mutually compensated during the of the obligation of the obligation
pendency of the condition. Plurality of subjects is Plurality of subjects is
NOT required indispensable
3. Obligations with a Term or Period: Upon the (DE LEON225 (2014))
happening of the day certain, the obligations
becomes demandable. (CIVIL CODE, art. 1193) Q: Distinguish a Solidary Debtor from a Surety.

4. Obligations subject to a Resolutory SOLIDARY DEBTOR SURETY

Condition/Period: Demandable at once, With principal liability With primary liability:
subject to its resolution upon the happening of can be made to pay
the condition/period. (CIVIL CODE, arts. 1179 only when principal
and 1193) debtor does not pay
Pays for full amount If he pays the full
Q: May an obligation be considered indivisible and can seek amount, he may
even if the object is physically divisible? reimbursement from recover the FULL
A: Yes. Article 1225 of the New Civil Code states other solidary debtors amount from principal
that even though the object or service may be debtors
physically divisible, an obligation is indivisible if so Extension of time Extension of time
provided by law or intended by the parties. The granted to other granted to principal
indivisibility of an obligation is tested against solidary debtors w/o debtor w/o his consent
whether it can be the subject of partial performance. his consent does not releases him
An obligation is indivisible when it cannot be validly release him
performed in parts, whatever may be the nature of Can be made to pay Can bind himself for
the thing which is the object thereof. The indivisibility the full amount less than the full
refers to the prestation and not to the object thereof. amount of the
(Civil Code, art.1225; DE LEON249, 2014; see also obligation
Lam v. Kodak, G.R. No. 167615, 2016)
(DE LEON222-223 (2014))
Q: What is the effect of breach in joint indivisible
Q: What is the rule on reimbursement among
obligations?
solidary debtors under Article 1217 of the Civil
A: If one of the joint debtors fails to comply with his
Code?
undertaking, the obligation can no longer be fulfilled
A: Once creditor is paid in full, the obligation is
or performed. Consequently, it is converted into one
extinguished, and the debtor who pays is entitled to

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reimbursement from others, as if joint (based on
agreed sharing or if there is none, equally) with the
interest for the payment already made. If the
payment is made before the debt is due, no interest
for the intervening period may be demanded. (CIVIL
CODE, art. 1217)
When one of the solidary debtors cannot, because
of his insolvency, reimburse his share to the debtor
paying the obligation, such share shall be borne by
all his co-debtors, in proportion to the debt of each.
(CIVIL CODE, art. 1217)
Q: What are the purposes of penalty or penal
clause in a contract?
1. To insure the performance of the obligation
(general, regardless whether compensatory or
punitive);
2. To liquidate the amount of damages to be
awarded to the injured party in case of breach
of the principal obligation (compensatory); and
3. To punish the obligor in case of breach of
principal obligation in certain exceptional cases
(punitive). (D.M. Ragasa v. BDO. G.R. 190512,
2018)
Q: When may a penalty substitute damages?
A: General rule: The penalty fixed by the parties
takes the place of all damages and interests in case
of breach. (CIVIL CODE, art. 1226)
Exceptions: (StiRF)
1. When by Stipulation of the parties, penalty, IN
ADDITION to interest, may be collected;
2. When the debtor is sued for Refusal to pay the
agreed penalty; and
3. When debtor is guilty of Fraud. (CIVIL CODE, art.
1226)
4. EXTINGUISHMENT
Q: What are the principal modes of
extinguishments of obligations? (PaL-CoCoCo-
No)
1. Payment or performance
2. Loss of the thing due
3. Condonation or remission of debt
4. Confusion or merger of rights
5. Compensation
6. Novation (CIVIL CODE, art. 1231)
Q: What are the other modes of extinguishment
4. A: The following are the other modes of
extinguishment:
1. Annulment
2. Rescission
3. Fulfillment of resolutory condition
4. Prescription (CIVIL CODE, art. 1231)
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CIVIL LAW (AND PRACTICAL EXERCISES)
Q: What are the modes that are not stated in
Article 1231 of the Civil Code:
1. Death of a party in personal obligations (4
ARTURO M. TOLENTINO, COMMENTARIES AND
JURISPRUDENCE ON THE CIVIL CODE OF THE
PHILIPPINES 271 (1991))
2. Mutual Desistance (Saura Import & Export Co.
v. DBP, GR No. L-24968 (1972))
3. Compromise (CIVIL CODE, art. 2028)
4. Impossibility of Fulfillment (CIVIL CODE, art.
1184)
5. Happening of Fortuitous Event (CIVIL CODE, art.
1165)
6. Arrival of Resolutory Period (CIVIL CODE, art.
1193)
Q: What is the result of rescission of a contract
under Article 1191?
A: General Rule: The recission of a contract under
Article 1191 will result in the mutual restitution of
the benefits which the parties received.
Exceptions: Mutual restitution of the benefits will
not happen:
1. When there is an express stipulation to the
contrary by way of a forfeiture or penalty clause
in recognition of the parties’ autonomy of
contract; or
2. If the buyer was given possession or was able
to use the property prior to transfer of title,
where in such case, partial payments may be
retained and considered as rentals by the seller
to avoid unjust enrichment. (Heirs of Kim V.
Quicho. G.R. 249247, 2021)
Q: What is the principle of integrity of payment
or performance of obligations?
A: General rule: A debt shall not be deemed paid
UNLESS the thing or service of which the obligation
consists of has been completely delivered or
rendered, as the case maybe. (CIVIL CODE, art.
1233)
Exceptions:
1. When the obligation has been substantially
performed in good faith (CIVIL CODE, art. 1234);
2. When the obligee accepts performance despite
its incompleteness or irregularity and without
expressing any protest or correction (CIVIL
CODE, art. 1235);
3. In cases involving divisible obligations capable
of partial performance.
(PINEDA192-193 (2009))
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Q: What is the principle of substantial
performance?
A: If the obligation has been substantially performed
in good faith, the obligor may recover as though
there had been a strict and complete fulfillment, less
damages suffered by the obligee. This is the basis
of the rule that if the breach is only slight, the obligee
cannot resolve or cancel the obligation. Generally,
the courts will grant the obligor a certain time to
make up for the slight breach. The “damages
suffered by the obligee” refers to the deficiency
which the obligee is still entitled to collect. (CIVIL
CODE, art. 1234; 4 TOLENTINO 277 (1991))
Substantial performance is applied only when the
obligor admits breaching the contract after honestly
and faithfully performing all the material elements
thereof except for some technical aspects or
deficiency that cause no serious harm to the
obligee. (International Hotel Corporation v. Joaquin
Jr., G.R. No. 158361, 2013).
Q: What are the requisites of substantial
performance? (GoSTeM):
1. Attempt in Good faith to perform without willful
or intentional departure
2. Deviation is Slight
3. Omission/Defect is Technical or unimportant
4. Must not be so Material that intention of parties
is not attained. (International Hotel Corporation
v. Joaquin Jr., G.R. No. 158361, 2013)
Q: A obtained a loan from B in the amount of Php
200,000.00. On due date, A offered to pay the
entire amount through a manager’s check. B
refused, demanding payment in cash. A
countered by arguing that the manager’s check
is good as cash. Can B be compelled to accept
the payment of B?
A: No. Payment must be in legal tender (CIVIL CODE,
art. 1249). Personal checks, Cashier’s or Managers
checks are NOT legal tender, so a creditor cannot
be compelled to accept them (unless such is
stipulated as the mode of payment).
Creditor, however, has the option to accept
payment in checks of any kind. If the creditor
accepts the check or no prompt objection to the form
of payment is made, there is valid tender of payment
and creditor can no longer claim later that payment
is not in legal tender. (Pabugais v. Sahijwani, G.R.
No. 156846, 2004)
Q: When can the delivery of a check produce
the effect of payment?
A: When payment in check is delivered and
accepted, it produces the effect of payment only
when the check is cleared (retroacts to the date
BACK TO TOP
CIVIL LAW (AND PRACTICAL EXERCISES)
the check was deposited) and the funds are
transferred to the account of the creditor. Stale
checks (those not presented for payment within 6
months from date of check) do not produce the
effect of payment and debtor can be required to
issue a new check or pay in cash since the
obligation is not yet deemed paid. Debtor cannot
however be liable for interest or penalty and cannot
be declared in default since creditor could have
immediately presented it for payment. It is only in
cases where the value is impaired through
creditor’s fault (i.e., creditor misplaced the check
and someone else encashed it), that the debtor is
deemed to have paid his obligation without
having to issue a new check or paying in cash.
(Evangelista v. Screenex, Inc., G.R. No. 211564,
2017)
Q: Article 1176 provides that: “The receipt of the
principal by the creditor, without reservation
with respect to the interest, shall give rise to the
presumption that said interest has been paid.”
Article 1253 states that: “If the debt produces
interest, payment of the principal shall not be
deemed to have been made until the interests
have been covered.” How are these two
rebuttable presumptions reconciled?
A: Article 1176 should be treated as a general
presumption subject to the more specific
presumption under Article 1253. Article 1176 applies
when there is doubt as to whether interest is waived
because the creditor accepts the payment for the
principal without reservation with respect to the
interest. Here, the creditor is presumed to have
waived the right to collect interest. Article 1254 has
no issue on waiver of interest because it is a given
under this Article that the debt produces interest.
The doubt is on whether the amount received by the
creditor is payment for the principal or the interest.
Article 1253 resolves this doubt by providing a
hierarchy: payments shall first be applied to the
interest; payment shall then be applied to the
principal only after the interest has been fully paid.
(Marquez v. Elisan Credit Corporation, G.R. No.
194642, 2015)
Q: What are the requisites for the application of
Art. 1250 on extraordinary inflation/deflation:
1. There is an official declaration of extraordinary
inflation or deflation from the BSP
2. The obligation is contractual in nature
3. The parties expressly agreed to consider the
effects of the extraordinary inflation or deflation.
(DE LEON 311 (2014)); see Equitable PCI Bank
v. Sheung Ngor, G.R. No. 171545, 2007)
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Q: What is dacion en pago?
A: Dacion en pago or dation in payment is a mode
of extinguishing an obligation whereby the debtor
pays a monetary obligation with property. It is a
special form of payment because one element of
payment is missing: Identity.
(PARAS 380 (2016))
Q: What are the requisites of dacion en pago?
(PAD)
1. There must be the Performance of the
prestation in lieu of payment which may consist
in the delivery of a corporeal thing or a real right
or a credit against the third person
2. There must be some Difference between the
prestation due and that which is given in
substitution
3. There must be an Agreement between the
creditor and debtor that the obligation is
immediately extinguished (to the extent of
agreed valuation) by reason of the performance
of a prestation different from that due. (DE
LEON 321 (2014))
Q: A Corporation bought several buses from B
Corporation for a total amount of Php 50 million.
A Corporation was only able to pay Php 10
million. To settle its outstanding balance, A
Corporation offered to pay its obligation with a
parcel of land worth Php 30 million in the form
of dacion en pago, which B Corporation
accepted. Up to what extent did the said dacion
en pago extinguish A Corporation’s obligation
to B?
A: Dation in payment extinguishes the obligation to
the extent of the value of the thing delivered, either
as agreed upon by the parties or as may be proved,
unless the parties by agreement – express or
implied, or by their silence – consider the thing as
equivalent to the obligation, in which case the
obligation is totally extinguished. (Tan Shuy v.
Maulawin, G.R. No. 190375, 2012)
Q: What is Cession in Payment?
A: The process by which a debtor transfers ALL his
assets which are not subject to execution in favor of
creditors, so that the latter may sell them and apply
the proceeds to his outstanding obligations. Except
if there is contrary agreement, or as may be
provided by law, the obligations are extinguished
only up to the net amount of the proceeds of the
sale. (PARAS 417 (2016))
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CIVIL LAW (AND PRACTICAL EXERCISES)
Q: Differentiate Dation in Payment from Cession
in Payment
Dation in Payment Cession in Payment
(Art. 1245) (Art. 1255)
One creditor Plurality of creditors
NOT necessarily in Debtor must be
state of financial insolvent
difficulty
Thing delivered is Universality of property
considered as of debtor is what is
equivalent of ceded
performance
Payment extinguishes Merely releases debtor
obligation to the extent up to the net proceeds
of the value of the thing of things ceded or
delivered as agreed assigned, unless there
upon is a contrary intention.
(DE LEON 356-357 (2014))
Q: What is the effect of Impossibility of
Performance in Obligation to Do?
A: Debtor is released when the prestation becomes
legally or physically impossible without fault on the
part of the debtor. (CIVIL CODE, art. 1266)
Q: What is the principle of Rebus Sic Stantibus?
A: The agreement is valid only if the same
conditions prevailing at time of contracting continue
to exist at the time of performance. Obligor may be
released in whole or in part if the conditions have
changed so that it becomes manifestly beyond the
intention of the parties. (4 TOLENTINO 336 (1991))
Q: What are the requisites of Rebus Sic
Stantibus? (FoDAF)
1. The event or change could not have been
Foreseen at the time of the execution of the
contract.
2. The performance is extremely Difficult, but NOT
impossible (because if it is impossible, it is
extinguished by impossibility).
3. The event was not due to the Act of any of the
parties.
4. The contract is for a Future prestation
(4 TOLENTINO 347 (1991))
The difficulty of performance contemplated should
be such that one party would be placed at a
disadvantage by the unforeseen event. Mere
inconvenience, or unexpected impediments, or
increased expenses did not suffice to relieve the
debtor from a bad bargain. (Tagaytay Realty v.
Gacutan G.R. No. 160033, 2015)
Q: What are the requisites of Compensation?
(LM-STD)
1. Both parties must be Mutual creditors and
debtors - in their own right and as principals.
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2. Both debts must consist in Sum of money or if offered that C be substituted in his place as the
consumable, of the same kind or quality. debtor. C consented, while A did not. Was there
3. Both debts are Due. a valid substitution of the debtor?
4. Both debts are Liquidated and demandable
(determined). A: No. Novation can be done without the knowledge
5. Neither debt must be retained in a controversy or even against the will of the original debtor, but not
commenced by Third person and without the consent of the creditor (Interport
communicated w/ debtor (neither debt is Resources Corporation v. Securities Specialist, In.
garnished). (CIVIL CODE, art. 1279) G.R. No. 154069, 2016)

NOTE: A claim is liquidated when the amount and Q: What is Subrogation?

time of payment is fixed. If acknowledged by the
debtor, although not in writing, the claim must be
treated as liquidated. When the defendant, who has
an unliquidated claim, sets it up by way of
counterclaim, and a judgment is rendered liquidating
such claim, it can be compensated against the
plaintiff’s claim from the moment it is liquidated by
judgment. Compensation takes place only if both
obligations are liquidated. (Lao v. Special Plans,
Inc., G.R. No. 164791, 2010)
Q: Can a taxpayer’s tax due to the government
be offset or be compensated with the debt of the
government due to a taxpayer?
A: No. Taxes cannot be subject to compensation for
the simple reason that the government and the
taxpayer are not creditors and debtors of each other.
There is a material distinction between a tax and
debt. Debts are due to the Government in its
corporate capacity, while taxes are due to the
Government in its sovereign capacity. (United
Airlines, Inc. v. Commissioner of Internal Revenue,
G.R. No. 178788, 2010)
A: It is defined as the transfer of all the rights of the
creditor to a third person, who substitutes him in all
his rights. (4 TOLENTINO 401-402 (1991))
It may either be legal or convention. Legal
subrogation is that which takes place without
agreement but by operation of law because of
certain acts (CIVIL CODE, arts. 1300 & 1302).
Conventional subrogation is that which takes place
by agreement of parties (CIVIL CODE, arts. 1300-
1301).
Q: When is subrogation presumed?
1. Creditor pays another preferred creditor even
w/o debtor’s knowledge
2. Third person not interested in obligation pays w/
approval of debtor
3. Person interested in fulfillment of obligation
pays debt even w/o knowledge of debtor (CIVIL
CODE, art. 1302)
Q: What is the difference between assignment of
credit and legal subrogation?

Q: What are the requisites of novation? (VICN) ASSIGNMENT OF LEGAL

1. There must be a previous Valid obligation; CREDIT SUBROGATION
2. Intent to extinguish the old and substitute it with An agreement by virtue It is the transfer of all
the new obligation, whether expressed, or of which the owner of a the rights of the
implied as when the two obligations are credit (known as the creditor to a third
inconsistent and cannot stand together. assignor), by a legal person, who
3. Capacity and consent of the parties to the new cause · such as sale, substitutes him in all
obligation; and dation in payment or his rights. It may either
4. Valid New obligation. (Garcia, Jr. v. CA, G.R. exchange or donation · be legal or
No. 80201, 1990) and without need of the conventional. Legal
debtor’s consent, subrogation is that
Note: Novation is never presumed, there must be transfers that credit which takes place
an express intention to novate. The creditor’s and its accessory without agreement
acceptance of another check, which replaced an rights to another but by operation of
earlier dishonored check, does not result in novation (known as the law because of
where there was no express agreement to establish assignee), who certain acts
that the debtor was already discharged from his acquires the power to
liability. (Salazar v. J.Y. Brothers Marketing enforce it, to the same
Corporation, G.R. No. 171998, 2010) extent as the assignor
could have enforced it
Q: A, as creditor, lent Php. 1,000.00 to B, the against the debtor.
debtor, due 15 days after the receipt of the (Henson v. UCPB, G.R. 223134, 2019)
money by B. On due date, B failed to pay A. B

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Q: Distinguish expromision from delegacion.
EXPROMISION DELEGACION
Intention: old debtor be released from the
obligation
Consent of creditor required on both
Consent of creditor and Consent of debtor
third person (initiates), creditor
and third person;
need NOT be given
simultaneously
Governed by the rules of Same applies in the
payment by third persons absence of an
agreement
If w/o knowledge of Subrogation
debtor, beneficial
reimbursement, no
subrogation
New debtor's insolvency Same UNLESS the
does NOT make old new debtor’s
debtor liable insolvency already
existed at the time of
the delegacion AND
(i) it was of public
knowledge, or (ii) the
old debtor knew of
the insolvency of the
new debtor at the
time of delegacion.
(PINEDA 341-343 (2009))
Q: In 1996, CJH Corp constructed hotels in
Baguio. In 2001, CJH Corp. entered into a
contractor’s agreement with CC Corp. CC was to
complete the interior and exterior painting
works of unit 2E of CJH’s hotel for the price of
Php 15.5M. This is inclusive of the price of two
studio-type units at the hotel. The agreement
contained no date of the units’ turnover, but it
allowed CC to choose the units for offsetting. CC
chose units 102 and 104. In 2003, CC completed
the painting works. CJH was only able to pay the
price, minus the value of the units. Therefore,
CC demanded the execution of the deed of sale
and the delivery of titles of the units which CJH
complied with. However, come 2008, CJH was
still experiencing construction delays and were
therefore unable to actually transfer the units.
CC filed a petition in court asking the latter to
declare the contract as rescinded. On the other
hand, CJH argues that the court should just fix a
period. Decide.
A: I will rule in favor of CC. Article 1191 of the New
Civil Code provides that the power to rescind
obligations is implied in reciprocal ones in case one
of the obligors should not comply with what is
incumbent upon him. Here, rescission is proper.
CJH and CC have reciprocal obligations since CC
has to complete the painting works while CJH has
to pay a certain price and transfer the units.
However, despite repeated demands, CJH failed to
deliver the units because construction was not yet
completed. Moreover, the obligation to fix a period
under Article 1197 does not apply because the law
requires that it can be inferred, from the nature and
circumstances, that a period was intended. In this
case, it is clear that the obligation to build the hotels
has been dragging on for years and no period was
intended by the parties since CC had been
repeatedly demanding for the transfer of the units.
Therefore, the contract should be rescinded (Camp
John Hay Development v. Charter Chemical, G.R.
No. 198849, 2019)
Q: PEZA entered into a contract with PS Corp.
where the latter was to deliver two firetrucks
within 45 days from the receipt of a purchase
order from the former. The contract stipulated
that failure to deliver the trucks on the specified
date will subject PS to a penalty of 0.1% of the
total contract price for each day of delay. PEZA
failed to deliver the trucks. The contract was
declared as rescinded by the RTC. PEZA now
asks the Court to grant damages based on the
penalty clause provided for in the contract. On
the other hand, PS argues that the penalty
stipulation cannot be recognized since the
contract was rescinded, and therefore, only
mutual restitution is required. Decide.
A: I will rule in favor of PEZA. Rescission under
Article 1911 of the Civil Code results in mutual
restitution. Jurisprudence has long settled that the
restoration of the contracting parties to their original
state is the very essence of license for the negation
of contractually stipulated liquidated damages.
Article 1191 itself clearly provides that the injured
party may choose between fulfillment and rescission
with the payment of damages in either case. When
the contracting parties, by their own free acts of will,
agreed on what these damages ought to be, they
established the law between themselves. Therefore,
the stipulation for liquidated damages must be
upheld. (PEZA v. Pilhino Sales Corp., G.R. No.
185765, 2016)
Q: Distinguish expromision from delegacion.
A: Both result in a novation of an obligation through
a change in the person of the debtor. In
expromision, the initiative for the substitution does
not come from the original debtor and does not
require his consent. However, the consent of the
new debtor and the creditor is required. In
delegacion, the original debtor offers, and the

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creditor accepts the substitution by the new debtor.
In expromision, the subsequent insolvency of the
new debtor does not revive the obligation of the old
debtor. In delegacion, the original debtor’s liability
will be revived if: (1) the new debtor’s insolvency is
pre-existing; and (2) this insolvency was known to
the original debtor or was of public knowledge.
B. CONTRACTS
1. GENERAL PROVISIONS
Q: When is a contract perfected?
1. Consensual contracts: As a general rule,
contracts are perfected by mere consent of the
parties regarding the subject matter and the
cause of the contract. (CIVIL CODE, arts. 1315,
1319) They are obligatory in whatever form
they may have been entered into, provided all
the essential requisites for their validity are
present. (CIVIL CODE, art. 1356)
2. Real contracts: The exceptions are real
contracts, which are perfected not merely by
consent but by the actual or constructive
delivery of the object of the obligation. (CIVIL
CODE, art. 1316) (e.g. commodatum, pledge,
deposit)
3. Formal/Solemn contracts: When the law
requires that a contract be in some form to be
valid (CIVIL CODE, art. 1356), this special form
is necessary for its perfection. (e.g., donation
of real property)
Q: What are the characteristics of a contract?
1. Autonomy – freedom to stipulate; contracting
parties may establish such stipulations,
clauses, terms and conditions as they may
deem convenient
 Provided: not contrary to law, morals,
good customs, public order, or public
policy (C IVIL CODE, art. 1306)
2. Relativity – contracts are generally binding only
between the parties, their assigns, and heirs
 except where the rights and obligations
arising from the contract are not
transmissible by their nature, or by
stipulation or by provision of law (CIVIL
CODE, art. 1311)
3. Obligatoriness – once a contract is perfected
(by mere consent), the parties are bound to the
fulfillment of what has been expressly stipulated
and compliance thereof must be in good faith;
they are also bound to all the consequences
which, according to their nature, may be in
keeping with good faith, usage and law (CIVIL
CODE, art. 1315)
4. Mutuality – a contract must bind both
contracting parties; its validity or compliance
BACK TO TOP
CIVIL LAW (AND PRACTICAL EXERCISES)
cannot be left to the will of one of them (CIVIL
CODE, art. 1308)
Q: What is a contract of adhesion?
A: Its terms are prepared by only one party while the
other party merely affixes his signature signifying his
admission thereto. It is binding as ordinary contracts
the reason being that the party who adheres to it is
free to reject its entirety. It is stricken down as void
when the weaker party is imposed upon in dealing
with the dominant bargaining party and is reduced
to the alternative of taking it or leaving it, completely
deprived of the opportunity to bargain on equal
footing. (Dio v. St. Ferdinand Memorial Park, Inc.,
G.R. No. 169578, 2006)
Q: Is the pre-approved credit card holder already
bound to the terms and conditions of the card
membership agreement upon using the pre-
approved credit card?
A: No, despite use of a pre-approved credit card,
consent is still necessary to by bound by the terms
and conditions. When petitioners accepted
respondent's credit card by using it to purchase
goods and services, a contractual relationship was
created between them, "governed by the Terms and
Conditions found in the card membership
agreement. Such terms and conditions constitute
the law between the parties." When issuing a pre-
screened or pre-approved credit card, the credit
card provider must prove that its client read and
consented to the terms and conditions governing the
credit card's use. Failure to prove consent means
that the client cannot be bound by the provisions of
the terms and conditions, despite admitted use of
the credit card. (Sps. Yulo v. BPI, G.R. 217044,
2019)
Q: When is a bidding contract perfected?
A: In bidding contracts, the award of the contract to
the bidder is an acceptance of the bidder's offer. Its
effect is to perfect a contract between the bidder and
the contractor upon notice of the award to the
bidder.
The award of a contract to a bidder perfects the
contract. Failure to sign the physical contract does
not affect the contract's existence or the obligations
arising from it. (Metro Rail Transit Development
Corp. v. Gammon Philippines, Inc, G.R. No. 200401,
2018)
2. ESSENTIAL REQUISITES
Q: What are the essential requisites?
1. Consent;
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2. Subject Matter; and
3. Consideration
Q: Who are incapacitated to give consent? (DD-
MI)
1. Minors (CIVIL CODE, art. 1327).
2. Insane or demented persons (CIVIL CODE, art.
1327), unless the contract was entered into
during a lucid interval (CIVIL CODE, art. 1328)
3. Deaf-mutes who do not know how to write
(CIVIL CODE, art. 1327).
4. In a state of Drunkenness or under a hypnotic
spell (CIVIL CODE, art. 1328)
Contracts entered into by the persons above are
generally valid until annulled (voidable); however,
annulment cannot prosper when they have been
ratified. (CIVIL CODE, art. 1390).
Q: X and Y, both minors, entered into a
contract. Is the contract void?
A: No. If both parties to a contract are incapable of
giving consent to a contract, the contract is
unenforceable. (CIVIL CODE, art. 1403(3)).
Q: Is the absence of a spouse’s consent void or
merely voidable?
A: Contracts disposing of conjugal property without
the wife’s consent are not void, but merely voidable.
This is akin to an incapacity to give consent, which
renders the contract merely voidable. (Spouses
Cueno v. Spouses Bautista, G.R. No. 246445, 2021)
Q: What are the elements that must concur
before the property owner will be entitled to just
compensation for a right-of-way enforced by the
government, pursuant to Sec. 112 of CA 141?
A: The two elements are: (1) that the remainder is
not subject to the statutory lien of right of way; and
(2) that the enforcement of the right of way results in
the practical destruction or material impairment of
the value of the remaining property, or in the
property owner being dispossessed or otherwise
deprived of the normal use of the said remainder.
(Bartolata v. Republic, G.R. No. 223334, 2017)
Q: Can a landowner enter into a contract with the
government to collect just compensation even if
he is not entitled to it?
A: No. The contract entered for the government's
acquisition of the affected portion of the property in
exchange for just compensation, when the owner of
the property is not entitled to it, is void ab initio for
being contrary to law. (Bartolata v. Republic, G.R.
No. 223334, 2017)
Q: Identify and differentiate the two types of
fraud in contracts.
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CIVIL LAW (AND PRACTICAL EXERCISES)
A: In order that fraud may vitiate consent, it must be
the causal (dolo causante), not merely the incidental
(dolo incidente), inducement to the making of the
contract. (Ponce de Leon v. Rehabilitation Finance
Corporation, G.R. No. L24571, 1970)
Causal fraud (Dolo Causante) is the use of
insidious words or machinations by one of the
contracting parties to induce the other party to enter
into a contract, which, without them, he would not
have agreed to. (CIVIL CODE, art. 1338) It is the
deception employed by one party prior to or
simultaneous to the contract in order to secure the
consent of the other (Metropolitan Fabrics, Inc. v.
Prosperity Credit Resources, Inc., G.R. No. 154390,
2014).
Incidental Fraud (Dolo Incidente) Deceptions or
misrepresentations which are not serious and
without which the other party would still have
entered into the contract. It is not the cause which
induced the party to enter into a contract and refers
only to some particular or accident of the
obligations. (Geraldez v. CA, G.R. No. 108253,
1994)
Q: When is a Cause of Consideration valid in a
contract?
1. It must Exist at the time the contract is entered
into. (Civil Code, art. 1352 & 1409 [3])
2. It must be True (Civil Code, art 1353)
3. It must be Licit (Civil Code, art 1352)
Q: What are causes which may vitiate the
consent? (VIMFU)
A: A contract where consent is given through: (1)
Mistake, (2) Violence, (3) Intimidation (4) Undue
Influence; or (5) Fraud (CIVIL CODE, art. 1330)
Q: When can a thing be considered to be a
subject matter of a contract? (W-PLDT)
1. Within the commerce of man (Civil Code, art.
1347) – either existing or in potency
2. Licit or not contrary to law, morals, good
customs, public order or public policy (Civil
Code, art. 1347)
3. Possible, legally or physically (Civil Code, art.
1348).
4. Determinate as to its kind or determinable
without need to enter into a new contract (Civil
Code, art. 1349)
5. Transmissible (Civil Code, art. 1347)
Q: What are things which cannot be the subject
matter of a contract? (I-COFID)
1. Things which are Outside the commerce of
men (CIVIL CODE, art. 1347)
2. Intransmissible rights (CIVIL CODE, art. 1347)
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3. Future inheritance, except in cases expressly
authorized by law (CIVIL CODE, art. 1347)
4. Services Contrary to law, morals, good
customs, public order or public policy (CIVIL
CODE, art. 1347)
5. Impossible things or services (C IVIL CODE, art.
1348).
6. Objects which are not possible of
Determination as to their kind (CIVIL CODE, art.
1349)
Q: What are the conditions that must be present
so that a purchaser of a registered and titled
parcel of land may safely rely on the face of the
title?
A: To prove good faith, the purchaser must only
show that he relied on the face of the title to the
property, and such proof of good faith is sufficient.
However, the rule applies only when the following
conditions concur: (1) the seller is the registered
owner of the land; (2) the latter is in possession
thereof; and (3) the buyer was not aware at the time
of the sale of any claim or interest of some other
person in the property, or of any defect or restriction
in the title of the seller or in his capacity to convey
title to the property.
where the land sold is in the possession of a person
other than the vendor, the purchaser must go
beyond the certificate of title and make inquiries
concerning the actual possessor. (De Villa v. Mallo,
G.R. No. 218377, 2021)
3. Reformation of Instruments
Q: What are the requisites for an action for
reformation? (VP-PIM)
1. Meeting of the minds (CIVIL CODE, art. 1359)
2. True Intention is not expressed (CIVIL CODE, art.
1359)
3. Clear and convincing Proof (HECTOR S. DE LEON
& HECTOR M. DE LEON, JR., COMMENTS AND
CASES ON OBLIGATIONS AND CONTRACTS 713
(2014))
4. Within proper prescriptive Period
5. Not simple unconditional donation inter vivos or
contract where real agreement is Void (CIVIL
CODE, art. 1366)
Q: When is reformation now allowed? (SD-WV)
1. Simple Donation
2. Wills
3. Real agreement is Void (CIVIL CODE, art. 1366)
Q: Who may ask for reformation? (NOT-FE-MM)
1. The party who is NOT at Fault (i.e., injured
party, heirs or assigns) (CIVIL CODE, art. 1367)
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CIVIL LAW (AND PRACTICAL EXERCISES)
2. Party who is NOT asked to Enforce the
instrument (CIVIL CODE, art. 1368)
3. If there is a Mutual Mistake, reformation may be
had by either party or successor in interest
(CIVIL CODE, art. 1368)
4. INTERPRETATION OF
CONTRACTS
Q: How are contracts interpreted?
A: If the terms of the agreement are clear and
unequivocal, their plain and literal meanings should
be followed. (CIVIL CODE, art. 1370)
Q: What laws are applicable to the execution of
a contract?
A: Only laws existing at the time of the execution of
a contract are applicable to it and not the later
statutes unless the latter are specifically intended
to have retroactive effect. (Vive Eagle Land, Inc. v.
CA, G.R. No. 150308, 2004)
Q: How is ambiguity in a contract construed?
A: The ambiguity in a contract should be construed
against the party who caused the same. (CIVIL
CODE, art. 1377)
5. RESCISSIBLE CONTRACTS
Q: What are Rescissible Contracts under Art.
1381? (ALL-GF)
1. Entered into by Guardian whenever ward
suffers damage by more than 1/4 of value of
object;
2. Agreed upon in representation of Absentees, if
absentee suffers lesion by more than ¼ of value
of property;
3. Contracts where rescission is based on Fraud
committed on creditors (accion pauliana);
4. Objects of Litigation; contract entered into by
defendant without knowledge or approval of
litigants or judicial authority; and
Q: What are the requisites for an Accion
Pauliana?
1. The plaintiff asking for rescission has a Credit
prior to the alienation, although demandable
later;
2. The debtor has made a Subsequent contract
conveying a patrimonial benefit to a third
person;
3. The creditor has No other legal Remedy to
satisfy his claim;
4. The act being impugned is Fraudulent;
5. The third person who received the property
conveyed, if it is by onerous title, has been an
Accomplice in the fraud. (Anchor Savings Bank
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v. Furigay, G.R. No. 191178, Mar. 13, 2013; Lee
v. Bangkok Bank Public Company, Limited,
G.R. No. 173349, Feb. 9, 2011)
Q: What are the requisites for Mutual
Restitution?
1. Plaintiff must be able to Return what has been
received by virtue of the rescissible contract
(CIVIL CODE, art. 1385)
2. Object of the contract is not in the legal
possession of Third persons in good faith. (CIVIL
CODE, art. 1385)
3. Plaintiff has no other legal Remedy. (CIVIL
CODE, art. 1383)
4. Action must be brought within the proper
prescriptive period of 4 years. (CIVIL CODE, art.
1389)
Q: In rescission of contracts under Article 1191,
must a party go to court to rescind?
A: Yes, except when there is a contractual
stipulation authorizing a party to extrajudicially
rescind the contract. As a general rule, the power to
rescind an obligation must be invoked judicially and
cannot be exercised solely on a party’s own
judgment that the other has committed a breach of
the obligation. (Golden Valley v. Pinkian Mining
Company, G.R. No. 190080, 2014); see also
Nolasco v. Cuerpo, G.R. No. 210215, 2015)
However, an aggrieved party is not prevented from
extrajudicially rescinding a contract to protect its
interests, even in the absence of any provision
expressly providing for such right. When done
without prior judicial imprimatur, however, it may still
be subject to a possible court review. (Nissan Car
Lease v. Lica Management, 2016)
NOTE: The act of party in treating a contract as
cancelled or resolved on account of infractions by
the other contracting party must be made known
to the other and is always provisional, being ever
subject to scrutiny and review by the proper court.
(U.P. v. delos Angeles, G.R. No. L-28602, 1970)
Q: What is the Clean Hands Doctrine?
A: States that “a litigant may be denied relief by a
court of equity on the ground that his conduct has
been inequitable, unfair and dishonest, or
fraudulent, or deceitful as to the controversy in
issue.” Bad faith and fraud are allegations of fact
that demand clear and convincing proof.
(Department of Public Works and Highways v.
Quiwa, G.R. No.183444, 2012)
However, an exception to this is if purpose has not
yet been accomplished and if damage has not been
caused to any 3rd person.
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CIVIL LAW (AND PRACTICAL EXERCISES)
Q: When is there a presumption of fraud to make
the contract rescissible?
1. When the debtor alienates property by
gratuitous title when he did not reserve
sufficient property to pay all debts contracted
before the donation;
2. Alienations by onerous title made by persons
against whom some judgment has been
rendered in any instance or some writ of
attachment has been issued; and
3. In all other cases where the design to defraud
creditors is proven in any other manner
recognized by law of evidence.
6. VOIDABLE CONTRACTS
Q: What contracts are voidable? (SIM-DDD)
1. By Minors (CIVIL CODE, art. 1327)
2. By Insane unless he/she acted during a lucid
interval (CIVIL CODE, art. 1327 & 1328)
3. By Deaf mute who can’t read or write (CIVIL
CODE, art. 1327)
4. By Persons specially Disqualified: civil
interdiction (CIVIL CODE, art. 1329 & 38)
5. In state of Drunkenness (CIVIL CODE, art. 1328)
6. In state of hypnotic Spell (CIVIL CODE, art. 1328)
Q: What are the requisites to ratify a voidable
contract? (Wack)
1. Knowledge of reason rendering contract
voidable (CIVIL CODE, art. 1393)
2. Such reason must have Ceased (CIVIL CODE,
art. 1393). Except in case of ratification effected
by the guardian to contracts entered into by an
incapacitated (CIVIL CODE, art. 1394)
3. The injured party must have executed an act
which expressly or impliedly conveys an
intention to Waive his right (CIVIL CODE, art.
1393)
7. UNENFORCEABLE
CONTRACTS
Q: What are the kinds of unenforceable
contracts? (URA)
1. Unauthorized or no sufficient authority –
Entered into in the name of another when: (Civil
Code, art. 1404)
a. No authority conferred (Civil Code, art.
1317)
b. In excess of authority conferred (ultra
vires) (Civil Code, art. 1317)
2. Curable by Ratification – Both parties incapable
of giving consent (2 minor or 2 insane persons)
Civil Code, art. 1407)
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3. Curable by Acknowledgment – Failure to
comply with Statute of Frauds. (Civil Code, art.
1405)
The following contracts are unenforceable for
failure to comply with the Statute of Frauds:
(CIVIL CODE, art. 1403 (2))
a. Agreement that by its terms is NOT to
be performed within a year after the
making thereof
b. Special promise to answer for debt,
default or miscarriage of another
c. Agreement made in consideration of
promise to marry
d. Agreement for sale of goods, chattels
or things in action at price not less than
500; exception: auction when recorded
sale in sales book
e. Agreement for lease of property for
more than one year and sale of real
property regardless of price
f. Representation as to credit of another
8. VOID OR INEXISTENT
CONTRACTS
Q: Does an action for reconveyance of property
based on a void contract prescribe?
A: When the action for reconveyance is based on a
void contract, the action is imprescriptible. The
property may be reconveyed to the true owner,
notwithstanding the TCTs already issued in
another's name. (Gatmaytan v. Misibis Land, Inc.,
G.R. No. 222166, 2020)
Q: What determines the prescription period for
an action for reconveyance?
A: Whether an action for reconveyance prescribes
or not is determined by the nature of the action, that
is, whether it is founded on a claim of the existence
of an implied or constructive trust, or one based on
the existence of a void or inexistent contract.
(Gatmaytan v. Misibis Land, Inc., G.R. No. 222166,
2020)
Q: What are simulated contracts?
1. Absolute – the parties have no intention to be
bound at all (CIVIL CODE, art. 1345); void from
beginning (CIVIL CODE, art. 1346). In absolute
simulation, there is a colorable contract but the
parties have no intention to be bound by it.
However, if the parties state a false cause in the
contract to conceal their real agreement, the
contract is relatively simulated and the parties
are still bound by their real agreement. (CIVIL
CODE, art. 1345; Valerio v. Refresca, G.R. No.
163687, 2006)
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CIVIL LAW (AND PRACTICAL EXERCISES)
2. Relative – the parties conceal their true
agreement (CIVIL CODE, art. 1345): the real
agreement binds the parties when:
i. There is no prejudice to 3rd persons; and
ii. It is not contrary to law, moral, good
customs, public order or public policy
(CIVIL CODE, art. 1346)
3. Dealer’s Talk (Dolo bonus) - This oxymoron
(literally, good fraud) refers to dealer’s talk, the
kind of exaggerations in advertisement the
public is familiar with. The ancient principle still
governs in this regard: Caveat emptor -- Buyer
beware. But once the dealer’s talk goes beyond
innocent conventional exaggeration and later
the realm of bad faith, then deceit (either
causante or incidental) may set in. (BALANE
635-36 (2020))
Q: Can gross inadequacy or simulation of price
affect or invalidate a sale?
A: Gross inadequacy or simulation of price neither
affects nor invalidates a sale, but it can be shown
that the parties may have really intended a donation
or some other act or contract. The burden of proof
weighs on the party making the allegation against
these presumptions. (Bacala v. Heirs of Poliño, G.R.
No. 200608, 2021)
Q: Can a contract of sale be questions as being
simulated AND at the same time have grossly
inadequate consideration?
A: No, one cannot question a contract of sale for
being simulated and at the same time assail the
same for having a grossly inadequate consideration.
The two grounds are incompatible, since if there
exists an actual consideration for transfer evidenced
by the alleged act of sale, no matter how inadequate
it be, the transaction could not be a simulated sale.
(Bacala v. Heirs of Poliño, G.R. No. 200608, 2021)
Q: What are the two types of interest?
A: The two types of interest are the following:
1. Monetary or conventional interest – refers to the
compensation set by the parties for the use or
forbearance of money; and
2. Compensatory interest – interest that may be
imposed by law or by courts as penalty for
damages. (Hun Hyung Park v. Eung Won Choi,
G.R. No. 220826, 2019)
NOTE: Compensatory/penalty/indemnity interest
refers to damages paid arising from delay in paying
a fixed sum of money or delay in assessing and
paying damages. (Sps. Abella v. Sps. Abella, G.R.
No. 195165, 2015)
Q: When will interest due and unpaid earn
interest?
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A: Generally, interest due and unpaid shall not earn
interest, except:
1. Interest due shall earn legal interest from the
time it is judicially demanded, although the
obligation may be silent upon this point. (Art.
2212)
2. If there is agreement to this effect. (Art. 1959)
Note: Interest on interest refers to interest due on
conventional interest. (Sps. Abella v. Sps. Abella,
G.R. No. 195165, 2015)
Q: When will the debtor be liable for interest
even in the absence of stipulation to pay
interest?
A: Generally, no interest shall be due unless it has
been expressly stipulated in writing. (Art. 1956) In
the following instances, interest is due even if not
expressly stipulated:
1. If the obligation consists in the payment of a
sum of money, and the debtor incurs in delay,
the indemnity for damages, there being no
stipulation to the contrary, shall be the payment
of the interest agreed upon, and in the absence
of stipulation, the legal interest, which is six per
cent per annum (Art. 2209); or
2. Interest due shall earn legal interest from the
time it is judicially demanded, although the
obligation may be silent upon this point. (Art.
2212)
Q: What is the legal interest rate?
A: 6%. Beginning July 1, 2013, the rate of interest
on the loan or forbearance on money, goods, or
credits and the rate allowed in judgments, in the
absence of stipulation, shall be 6% per annum (BSP
Circular No. 799).
However, judgments that became final and
executory before July 1, 2013 shall continue to apply
the previous legal rate of 12% per annum (NACAR
v. Gallery Frames Inc., G.R. No. 189871, 2013).
Q: What are the rules in the computation of legal
interest?
A: The Supreme Court, in Lara’s Gifts & Decors v.
Midtown Industrial Sales, G.R. No. 225433, 2019,
modified the new guidelines on the imposition of
interest as provided in Eastern Shipping Lines v.
CA, G.R. No. 97412, 1994 and NACAR v. Gallery
Frames, G.R. No. 189871, 2013:
When the obligation is breached, and it consists in
the payment of a sum of money, i.e., a loan or
forbearance of money, goods, credits or judgments,
the interest due shall be that which is stipulated by
the parties in writing, provided it is not excessive and
unconscionable, which, in the absence of a
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CIVIL LAW (AND PRACTICAL EXERCISES)
stipulated reckoning date, shall be computed from
default, i.e., from extrajudicial or judicial demand in
accordance with Article 1169 of the Civil Code,
UNTIL FULL PAYMENT, without compounding any
interest unless compounded interest is expressly
stipulated by the parties, by law or regulation.
Interest due on the principal amount accruing as of
judicial demand shall SEPARATELY earn legal
interest at the prevailing rate prescribed by the
Bangko Sentral ng Pilipinas, from the time of judicial
demand UNTIL FULL PAYMENT.
In the absence of stipulated interest, in a loan or
forbearance of money, goods, credits or judgments,
the rate of interest on the principal amount shall be
the prevailing legal interest prescribed by the
Bangko Sentral ng Pilipinas, which shall be
computed from default, i.e., from extrajudicial or
judicial demand in accordance with Article 1169 of
the Civil Code, UNTIL FULL PAYMENT, without
compounding any interest unless compounded
interest is expressly stipulated by law or regulation.
Interest due on the principal amount accruing as of
judicial demand shall SEPARATELY earn legal
interest at the prevailing rate prescribed by the
Bangko Sentral ng Pilipinas, from the time of judicial
demand UNTIL FULL PAYMENT.
When the obligation, not constituting a loan or
forbearance of money, goods, credits or judgments,
is breached, an interest on the amount of damages
awarded may be imposed in the discretion of the
court at the prevailing legal interest prescribed by
the Bangko Sentral ng Pilipinas, pursuant to Articles
2210 and 2011 of the Civil Code. No interest,
however, shall be adjudged on unliquidated claims
or damages until the demand can be established
with reasonable certainty.
Accordingly, where the amount of the claim or
damages is established with reasonable certainty,
the prevailing legal interest shall begin to run from
the time the claim is made extrajudicially or judicially
(Art. 1169, Civil Code) UNTIL FULL PAYMENT, but
when such certainty cannot be so reasonably
established at the time the demand is made, the
interest shall begin to run only from the date of the
judgment of the trial court (at which time the
quantification of damages may be deemed to have
been reasonably ascertained) UNTIL FULL
PAYMENT.
The actual base for the computation of the interest
shall, in any case, be on the principal amount finally
adjudged, without compounding any interest unless
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compounded interest is expressly stipulated by law
or regulation.
Q: Must the manner of compounding the interest
also be in writing?
A: In a loan agreement, compounding of interest
has to be in writing to be valid. Payment of monetary
interest shall be due only if: (1) there was an express
stipulation for the payment of interest; and (2) the
agreement for such payment was in writing. The first
requirement does not only entail reducing in writing
the interest rate to be earned but also the manner of
earning the same, if it is to be compounded. (Albos
v. Embisan, G.R. No. 210831, 2014)
Q: What is a usury?
A: It may be defined as contracting for or receiving
something in excess of the amount allowed by law
for the loan or forbearance of money, goods or
chattels. (De Leon, citing Tolentino v. Gonzales, 50
Phil. 558 (1927)).
While it is true that the interest ceilings set by the
Usury Law are no longer in force, it has been held
that PD 1684 and CB Circular 905 merely allow
contracting parties to stipulate freely on any
adjustment in the interest rate on a loan by
forbearance of money but do not authorize a
unilateral increase of the interest rate by one party
without the other's consent (PNB v. CA, G.R. No. L-
26001, 1968).
Q: When is the Usury Law’s effectivity
suspended?
A: The Monetary Board of Central Bank issued CB
Circular 905, effective January 1, 1983, removed the
ceilings on interest rate on loans or forbearance of
money, goods, or credit. The Circular did not repeal
nor in any way amend the Usury Law but simply
suspended the latter’s effectivity. Interest can now
be charged as lender and borrower may agree
upon. (Medel v. Court of Appeals, G.R. No. 131622,
1998)
Q: Distinguish escalation clauses from floating
rate of interest clauses.
A: Escalation clauses are stipulations which allow
for the increase (as well as the mandatory decrease)
of the original fixed interest rate. In turn, floating rate
of interest refers to the variable interest rate stated
on a market-based reference rate agreed upon by
the parties. The former refers to the method by
which fixed rates may be increased, while the latter
pertains to the interest rate itself that is not fixed.
(Security Bank Corp. v. Spouses Mercado (2018))
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CIVIL LAW (AND PRACTICAL EXERCISES)
Q: What is the effect of failing to pay a debt with
usurious/ unconscionable interest on the
validity of a foreclosure?
A: If the foreclosure arises out of the failure to pay a
mortgage indebtedness that has been grossly
inflated by unconscionable interest, the foreclosure
sale cannot be given any effect. A foreclosure must
be conditioned on the debtor’s failure to pay the
correct amount of the unpaid obligation, which
cannot include unconscionable interest charges.
However, the terms of the mortgage remain
effective, and foreclosure proceedings may be
instituted after a demand to pay the correct amount
of indebtedness and the debtor’s failure to pay such.
(Heirs of Espiritu v. Sps. Landrito, G.R. No. 169617,
2007)
C. NATURAL OBLIGATIONS
Q: What are natural obligations?
A: Natural obligations, not being based on positive
law but on equity and natural law, do not grant a right
of action to enforce their performance, but after
voluntary fulfillment by the obligor, they authorize
the retention of what has been delivered or rendered
by reason thereof. (CIVIL CODE, art. 1423)
Q: What are examples natural obligations
enumerated under the Civil Code?
1. Performance after the civil obligation has
prescribed
2. Reimbursement of a third person for a debt that
has prescribed
3. Restitution by minor after annulment of contract
4. Delivery by minor of money or fungible thing in
fulfillment of obligation
5. Performance after action to enforce civil
obligation has failed
6. Payment by heir of debt exceeding value of
property inherited
7. Payment of legacy after will has been declared
void. (CIVIL CODE, art. 1423-1430)
D. ESTOPPEL
Q: What is the concept of estoppel?
A: It is a condition or state by virtue of which an
admission or representation is rendered conclusive
upon the person making it and cannot be denied or
disproved as against the person relying thereon.
(CIVIL CODE, art. 1431)
Q: Against whom is estoppel effective?
A: Estoppel is effective only between the parties
thereto or their successors in interest. (CIVIL CODE,
art. 1439)
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Kinds:
1. Estoppel in pais (by conduct)
a. Estoppel by silence
b. Estoppel by acceptance of benefits
2. Technical estoppel
a. Estoppel by deed
b. Estoppel by record
c. Estoppel by judgment
d. Estoppel by laches
Q: What are the requisites of estoppel in pais?
1. As related to the party to be estopped (CIK)
a. Conduct which amounts to a false
representation or concealment of
material facts, or at least which is
calculated to convey the
impression that the facts are
otherwise than, and inconsistent
with those which the party
subsequently attempts to assert;
b. Intention or at least the
expectation, that such conduct
shall be acted upon, or influence,
the other party or other persons;
c. Knowledge, actual or constructive,
of the real facts
2. As related to the party claiming the estoppel
(IRA)
a. Ignorance or lack of knowledge
and of the means of knowledge of
the truth as to the facts in question
b. Reliance in good faith, upon the
conduct or statement of the party
to be estopped; and
c. Action or inaction based thereon of
such a character as to change the
position or status of the party
claiming the estoppel, to his injury,
detriment, or prejudice. (Manila
International Airport Authority v.
Ding Velayo Sports Center, Inc.,
G.R. No. 161718, 2011)
Q: What are the requisites of estoppel by laches
(CLID)?
1. Conduct on the part of the defendant, or of one
under whom he claims, giving rise to the
situation of which complaint is made;
2. Delay in asserting the complainant’s right, the
complainant having had knowledge or notice of
the defendant’s conduct and having been
afforded an opportunity to sue; actual
knowledge of the commission of the adverse act
is not necessary, it being enough that such
knowledge may be imputed to the complainant
because of circumstances of which he was
cognizant;
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CIVIL LAW (AND PRACTICAL EXERCISES)
3. Lack of knowledge or notice on the part of the
defendant that the complainant would assert
the right on which he bases his suit; and
4. Injury or prejudice to the defendant in the event
relief is accorded to the complainant, or the suit
is not held to be barred. (Cimafranca v. IAC,
G.R. No. L-68687, 1987)
E. TRUSTS
Q: What is the concept of Trusts?
A: A fiduciary relationship between a person who
establishes a trust (trustor), one in whom confidence
is reposed as regards property for the benefit of
another person (trustee), and a person for whose
benefit the trust has been created (beneficiary).
(CIVIL CODE, Art. 1440)
It is a legal relationship between one person who
has equitable ownership of the property and
another who owns the legal title to the property.
(Oco v. Limbaring, G.R. No. 161298, 2006)
Q: Who are the parties to a Trust?
1. Trustor – The person who establishes the trust.
2. Trustee – The person in whom confidence is
reposed as regards property for the benefit of
another.
3. Beneficiary – The person for whose benefit the
trust has been created. (Penalber v. Ramos,
G.R. No. 178645, 2009)
Q: Can Trustees donate property in Trust?
A: Trustees cannot donate the property entrusted to
them. (CIVIL CODE, Art. 736)
Q: What are the Kinds of Trusts?
1. Express Trust - Created by express agreement
of the parties, or by intention of trustor. (CIVIL
CODE, Art. 1441)
2. Implied Trust – Implied trusts are remedies
against unjust enrichment. Under the general
principles on trust, equity converts the holder of
property right as trustee for the benefit of
another if the circumstances of its acquisition
makes the holder ineligible in good conscience
to hold and enjoy it. (Juan v. Yap, Sr., G.R. No.
182177, 2011)
Q: How is an Express Trust extinguished?
1. Accomplishment of the aims of the trust;
2. Expiration of the agreed term;
3. Mutual agreement of all parties;
4. Happening of a resolutory condition;
5. Total loss of the object of the trust;
6. Annulment or rescission of the trust;
7. Decision of the court declaring termination;
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8. Merger of the rights of the trustor and the
trustee;
9. Prescription; and
10. Upon the trustee's death (Canezo v. Rojas,
G.R. No. 148788, 2007)
Q: When is no trust created?
A: A trust will not be created when for the purpose
of evading the law prohibiting one from taking or
holding real property, one takes conveyance thereof
in the name of a third person. (Kiel v. Estate of
Sabert, G.R. No. 21639, 1924)
Q: What are the kinds of Implied Trust?
1. Constructive Trust;
2. Resulting Trust;
3. Implied Trust When Property is Granted to
One/Trustee But Price is Paid by Another for the
Interest of Beneficiary;
4. Implied Trust in Donation;
5. Implied Trust in Sale of Property;
6. Implied Trust in Co-Ownership
7. Implied Trust in Succession
8. Property Conveyed in Reliance upon His
Declared Intention to Hold it For Another;
9. An Absolute Conveyance to Secure
Performance of Obligation;
10. Trustee’s Use of Funds Held in Trust; and
11. Property Acquired Through Mistake or Fraud;
Q: Can Oral Evidence be used to prove Implied
Trust?
A: Yes. It is deducible from the nature of the
transactions as matters of intent or which are super-
induced on the transaction by operation of law,
independently of the particular intention of the
parties. When an immovable or an interest therein is
involved in an express trust, parol evidence is not
allowed. But, when trust is implied, parol evidence is
allowed to prove its existence. Consequently, if
property involved in express trust is movable, parol
evidence is allowed.
Q: What is the applicable prescriptive period for
actions for the reconveyance of real property
based on implied trust?
A: 10 years, reckoned from the time the cause of
action accrues. (CIVIL CODE, Art. 1144; Sps. Dico
v. Vizcaya Management Corporation, G.R. No.
161211, 2013)
In arguing that the action for reconveyance had
prescribed, the petitioners claimed that the cause of
action of the respondent should be based on the
latter's Deed of Sale and thus the respondent's right
of action should have accrued from its
execution.110 This Court, however, ruled that the
right of action accrued from the time the property
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CIVIL LAW (AND PRACTICAL EXERCISES)
was registered because registration is the act that
signifies that the adverse party repudiates the
implied trust: (Sps. Roberto Aboitiz And Maria
Cristina Cabarrus v. Sps. Peter Po and Victoria Po,
G.R. No. 208450 and 208497, 2017)
Q: What are the requirements for a stipulation
pour autrui?
1. There is a stipulation in favor of a third person;
2. The stipulation is a part, not the whole, of the
contract;
3. The contracting parties clearly and deliberately
conferred a favor to the third person – the favor
is not an incidental benefit;
4. The favor is unconditional and uncompensated;
5. The third person communicated his or her
acceptance of the favor before its revocations;
and
6. The contract parties do not represent, or are not
authorized by, the third party. (Republic v. Heirs
of Africa (2015))
F. QUASI-CONTRACTS
Q: What are Quasi-contracts?
A: Quasi-contracts are juridical relations resulting
from lawful, voluntary and unilateral acts, which
has for its purpose, the payment of indemnity to the
end that no one shall be unjustly enriched or
benefited at the expense of another. (CIVIL CODE,
art. 2142)
Q: How do you distinguish a Quasi-contract
from other contracts?
1. The act giving rise to a quasi-contract must be
Lawful distinguishing it from delict;
2. The act must be Voluntary distinguishing it from
a quasi-delict which is based on fault or
negligence; and
3. The act must be Unilateral distinguishing it from
contract which is based on agreement.
(PINEDA 15 (2009))
Q: What are the kinds of Quasi-contracts?
1. Negotiorum Gestio is the voluntary
management of the property or affairs of
another in times of emergency without the
owner’s authority. (CIVIL CODE, art. 2144)
Obligation created: Return of the property by the
officious manager to the owner once the
emergency ceases, and for the owner to
reimburse expenses incurred by the officious
manager. (CIVIL CODE, art. 2150)
2. Solutio Indebiti is the juridical relation, which is
created when something is received when there
is no right to demand it and it was unduly
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delivered through mistake. (CIVIL CODE, art.
2154)
Obligation created: Recipient to return the property
delivered through mistake.
3. Other cases of quasi-contracts (CIVIL CODE,
art. 2164-2175)
NOTE: The Civil Code provides [the
abovementioned] enumeration of quasi-contracts,
but the list is not exhaustive and merely provides
examples. (Metrobank v. AMC, G.R. No. 170498,
2013)
Q: Can the government recover payment
erroneously made to a landowner through
solutio indebiti?
A: Yes. When the government erroneously made
payment to an owner of a property because of its
failure to discover earlier on that the portion of the
property acquired was subject to a statutory lien in
its favor, such circumstances satisfy the
requirements for solutio indebiti to apply. (Bartolata
v. Republic, G.R. No. 223334, 2017)
V. SALES
A. NATURE AND FORM
Q: What is a contract of sale?
A: It is a contract where one of the contracting
parties (Seller) obligates himself to transfer the
ownership and to deliver a determinate thing, and
the other party (Buyer) to pay a price certain in
money or its equivalent. A contract of sale may be
absolute or conditional. (Art. 1458)
Q: What are the elements of a contract of sale?
A: The elements of a contract of sale are: (CSP)
1. Consent
2. Determinate or Determinable Subject
Matter
3. Price certain in money or its equivalent
(Romulo A. Coronel, et al. v. Court of
Appeals, et al., G.R. No. 103577, 1996)
The absence of any essential elements negates
the existence of a perfected contract of sale.
(Regina P. Dizon, et al. v. Court of Appeals, at al.,
G.R. No. 122544, 1999)
Q: Does the seller have to be the owner of the
thing during the PERFECTION of the contract of
sale? What is the effect of such sale?
A: No. The seller need not be the owner of the
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CIVIL LAW (AND PRACTICAL EXERCISES)
subject matter at the time of perfection of the
contract. It is sufficient that he has the right to
transfer ownership at the time of delivery of the
subject matter. (Art. 1459)
If the seller acquired the subject matter and became
the owner at the time of delivery, the seller’s title
over the subject matter passes to the buyer by
operation of law. (Art. 1434)
If the seller is NOT the owner of the thing at the time
of delivery, the buyer acquires no better title to the
goods than the seller had, unless the owner of the
goods is by his conduct precluded from denying the
seller’s authority to sell. (Art. 1505) In cases where
the seller cannot transfer ownership over the thing
sold at the time of delivery, he may be held liable for
breach of contract.
An exception to the rule where the seller need not be
the owner of the subject matter at the time of
perfection of the contract of sale would be
foreclosure sales. (Art. 2085)
Under Art. 1475, the contract of sale is perfected at
the moment there is a meeting of minds upon the
thing which is the object of the contract and upon
the price. From that moment, the parties may
reciprocally demand performance, subject to the
provisions of the law governing the form of
contracts. (Ace Foods, Inc. v. Micro Pacific
Technologies Co., Ltd.,G.R. No. 200602,
December 11, 2013).
Q: What are the requisites for a valid price?
A: The price or consideration of a contract of
sale must have the following requisites at the
time of the perfection of the sale: (RMC)
1. It must be Real (Art. 1471,NCC);
2. It must be in Money or its
equivalent, valueable
consideration (Arts. 1458 and
1468,NCC);
3. It must be Certain or
ascertainable (Art. 1458,NCC)
Q: Distinguish a contract of sale from a contract
to sell.
CONTRACT OF CONTRACT TO SELL
SALE
DEFINITION
A contract whereby A bilateral contract
one of the whereby the prospective
contracting parties seller, while expressly
obligates himself to reserving the ownership
transfer the of the subject property
ownership and to despite delivery thereof
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deliver a to the prospective buyer,
determinate thing, binds itself to sell the said
and the other to property exclusively to
pay therefor a the prospective buyer
price certain in upon fulfillment of the
money or its condition agreed upon,
equivalent. A that is, full payment of the
contract of sale may purchase price.
be absolute or (Associated Marine
conditional. (Ace Officers and Seamen’s
Foods Inc. v. Micro Union of the Philippines
Pacific v. Decena, G.R. No.
Technologies Co., 178584, 2012)
Ltd., G.R. No.
200602, 2013)
TRANSFER OF TITLE
Title passes to the Ownership is reserved in
buyer upon delivery the seller and shall not
of the thing sold pass to the purchaser
(Art. 1477) until fulfillment of certain
conditions, such as full
payment of the purchase
price. (Art. 1478)
OWNERSHIP OF THE SELLER
The seller has lost Title remains in the seller
and cannot recover if the buyer does not
ownership of the comply with the condition
thing sold and precedent, which
delivered (Arts. payment of the price at
1477, 1496) until the time specified in the
and unless the contract. (Tuazon v.
contract of sale Garilao, G.R. No.
itself is resolved 143673, 2001)
and set aside.
NOTE: It must be
stipulated that ownership
in the thing shall not pass
to the buyer until full
payment of the price.
(Art. 1478)
PAYMENT OF THE PRICE
Non-payment of the Full payment of the price
price is a negative is a positive suspensive
resolutory condition. condition, the failure of
(Art. 1179) which is not a breach of
contract but simply an
event that prevents the
obligation of the seller to
convey title to the buyer.
(Uy& Sons, Inc. v.
Valbueco Inc., G.R. No.
179594, 2013)
The non-payment of the
purchase price renders
the contract to sell
without force and effect.
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CIVIL LAW (AND PRACTICAL EXERCISES)
(Tumibay v. Lopez, G.R.
No. 171692, 2013)
REMEDIES
Specific Specific performance
performance or cannot be availed of
rescission under when the contract to sell
Articles 1191, 1592, has been cancelled due
and 1593. to the non-payment of the
purchase price. The
buyer cannot demand the
seller to convey title
when such buyer did not
pay the price, and the
seller cannot demand the
buyer to pay the price,
since failure to pay
resulted in the
cancellation of the
contract to sell. (Pilipino
Telephone Corporation v.
Radiomarine Network
Phils. Inc., G.R. No.
160322, 2011)
Remedy of rescission is
not available because the
breach contemplated in
rescission of contracts is
the obligor’s failure to
comply with an obligation
already extant, not a
failure of a condition to
render binding that
obligation. A non-existent
obligation cannot be
subject of rescission.
(Diego v. Diego, G.R. No.
179965, 2013)
(De Leon, Comments and Cases on Sales and
Lease, 21-23, 2014)
Q: What are the stages in the life of a sale?
A: The stages in a life of a sale are: (NPC)
1. Policitacion/Negotiation Stage – Starts
from the time the prospective contracting
parties indicate interest in the contract to
the time the contract is perfected;
2. Perfection – Takes place upon the
concurrence of the essential elements of
the sale, which are meeting of the minds as
to the object of the contract and upon the
price;
3. Consummation – Begins when the parties
perform their respective undertaking under
the contract of sale, culminating in the
extinguishment of the contract of sale.
(San Miguel Properties Philippines v. Sps.
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Huang, G.R. No. 137290, 2000) offer of a contract of sale

which can be withdrawn by the
Q: When is ownership of the thing sold offeror before he learns of the
transferred to the buyer? acceptance by the offeree. If
A: Ownership of the thing sold is transferred to the the offer is accepted before
buyer upon actual or constructive delivery of the withdrawal, it would give rise
thing. (Art. 1477,NCC) The thing sold is understood to a valid sale. (Sanchez v.
as delivered when it is placed in the control and Rigos, G.R. No. L-25494,
possession of the buyer. (Art. 1497,NCC) 1972)
b. The right to withdraw must not
Q: What is an option contract? be done whimsically or
A: An option is a preparatory contract in which one arbitrarily, otherwise the other
party grants to the other, for a fixed period and party may sue for damages
under specificed conditions, the power to decide, under Article 19 of the New
whether or not to enter into a principal contract. Civil Code.
2. If the period has a separate
It binds the party who has given the option, not to consideration:
enter into the principal contract with any other a. The option contract is deemed
period, to enter into such contract with the one to perfected, if the option is
whom the option was granted, if the latter should exercised within the period, it
decide to use the option. It is a separate agreement would give rise to a sale which
distinct from the contract of sale which the parties can be enforced by specific
may enter into upon the consummation of the performance.
option. (Carceller v. Court of Appeals, G.R. No. b. If the offer is withdrawn within
124791, 1999) the option period, the
withdrawal constitutes a
Q: What are the elements of an option contract? breach of the option contract.
A: The elements of an option contract are: c. However, if the offer is
(A-Su-C) withdrawn before acceptance,
i. The offeree may not
1. Acceptance of the offer to buy or sell; sue for specific
2. A determinate Subject matter for a price performance on the
certain; sale, since the sale
3. Consideration, which is separate and itself was not
distinct from the purchase price. (Art. 1479, perfected.
par. 2) ii. The offeror may be
held liable for
Q: What is the effect of an absolutely simulated damages for breach
or fictitious contract of sale? of the option contract.
A: Under Art. 1346 of the Civil Code, an absolutely (Ang Yu Asuncion v.
simulated or fictitious contract is void. (Tanchuling Court of Appeals,
v. Cantela, G.R. No. 209284, 2015.) G.R. No. 109125,
1994)
Q: What is the effect of relative simulated
contract? Q: What is a right of first refusal?
A: A relative simulation, when it does not prejudice A: It is a promise on the part of the owner that if he
a third person and is not intended for any purpose decides to sell the property in the future, he would
contrary to law, morals, good customs, public order first negotiate its sale to the promisee.
or public policy binds the parties to their (VILLANUEVA, Law on Sales, p. 156)
agreement.” (Tanchuling v. Cantela, G.R. No.
209284, November 10, 2015.) It is an innovative juridical creation, which cannot be
deemed a perfected sale nor an option contract
Q: State the rules on option contracts. because it merely pertains to a specific property
A: The rules on option contracts are: without containing an agreement as to the price or
1. If the period is NOT supported by a the terms or manner of payment of payment in case
separate consideration: of exercise of the right of first refusal. (Ang Yu
a. The option contract is void. Asuncion v. Court of Appeals, G.R. No. 109125,
However, it still constitutes an 1994)

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Q: What is the remedy of the promisee in case of
breach of his right of first refusal?
A: As a general rule, the proper remedy is an action
for damages under Art. 19 of the Civil Code. (Ang
Yu Asuncion v. Court of Appeals, G.R. No. 109125,
1994)
The Courts would not allow an action for specific
performance or a rescission of the sale to a third
party which constitute the breach of the promise,
even when the third party buyer was entering into
the purchase of the subject property in bad faith.
(Guerrero v. Ynigo, G.R. No. L-5572, 1954)
However, if the right of first refusal is attached to a
valid principal contract, like a contract of lease, the
breach of the right by the promissor allows the
promisee to enforce his right by way of rescission of
the sale entered into with the third party who was
aware of the existence of the right of first refusal
(bad faith). (Equatorial Realty Dev. Inc., v. Mayfair
Theater, Inc., G.R. No. 106063, 1996) The right
cannot be enforced against a purchaser for value
and in good faith. (Rosencor Dev. Corp. v. Paterno
Inquing, et al., G.R. No. 140479, 2001)
Q: Is a right of first refusal subject to the Statute
of Frauds?
A: No. Art. 1403 (2) (e) of the Civil Code
presupposes the existence of a perfected, albeit
unwritten, contract of sale; the right of first refusal is
not by any means a perfected contract of sale of
real property. At best, it is a contractual grant, not of
the sale of real property involved, but of the right of
first refusal of the property to be sold. It need not
be in writing and may be proven by oral evidence
(Rosencor Dev. Corp v. Paterno Inquing, et al.,
G.R. No. 140479, 2001).
Q: Distinguish Earnest Money and Option
Money
Earnest Money Option Money
Part of the purchase Distinct consideration for
price and proof of the an option contract
perfection of the
contract
(Art. 1482,NCC)
Given only where there Applies to a sale not
is already a sale yet perfected
The buyer is bound to The buyer is not required
pay the balance to buy but may even
forfeit it depending on
the terms of the option.
(Oesmer v. Paraiso Dev. Corp., G.R. No. 111238,
1995)
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CIVIL LAW (AND PRACTICAL EXERCISES)
Q: Can the prior payment of earnest money
before the owner can agree to sell his property
bind the owner to the obligations of a seller?
A: No. In a potential sale transaction, prior payment
of earnest money even before the owner can agree
to sell his property is irregular and cannot be used
to bind the owner to the obligations of a seller. The
property owner/prospective seller may not be legally
obliged to enter into a sale with a prospective buyer
through the latter’s employment of questionable
practices which prevent the owner from freely giving
his consent to the transaction; this constitutes a
palpable transgression of the prospective seller’s
rights of ownership over his property (First Optima
Realty Corp. v. Securitron Security Services, G.R.
No. 199648, 2015).
B. CAPACITY TO BUY OR SELL
Q: Who may enter into a contract of sale?
A: All natural or juridical persons who have
capacity to act, or the power to do acts with legal
effects, or obligate themselves, may enter into a
contract of sale. (Art. 1489,NCC)
The following persons are incapacitated to enter
into a contract of sale because of their incapacity to
give consent: (MID-DRUNK-SPELL)
1. Minors (Art. 1327,NCC)
2. Insane and Demented Persons (Art.
1327)
However, when the contract is entered into
during a lucid interval the contract is valid.
(Art. 1328)
3. Deaf-Mutes (Art. 1327)
4. Persons who entered into a contract in a
state of DRUNKenness and hypnotic
SPELL(Art. 1328)
Contracts entered into by these persons are
voidable (Art. 1378 and 1390) subject to annulment
or ratification. (Art. 1393)
Nonetheless, where necessaries are sold and
delivered to minors or other persons without
capacity to act, he must still pay a reasonable price
therefore, (Art. 1489) thus, the resulting contract is
valid and not merely voidable.
Q: X filed a complaint for Declaration for nullity
of Sale, Reconveyance and Damages involving
the subject land originally owned by Y. X
alleged that they are grandchildren and
successor-in-interest of Z. Y denied
respondents' allegations and countered that he
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was a buyer in good faith, for value, and was
without any knowledge or participation in the
alleged defects of the title thereof; and were
never in possession of the subject land and
they never paid real property taxes over the
same. Ultimately, X claimed that he was duped
and swindled into buying the subject land
twice. The lower courts ruled in favour of Y,
declaring that the parties are not real parties to
the instant case considering that they are mere
grandchildren of Z. Are the lower courts
correct?
A: Yes. The rule on real parties in interest has two
(2) requirements, namely: (a) to institute an
action, the plaintiff must be the real party in interest;
and (b) the action must be prosecuted in the name
of the real party in interest. In the instant case,
respondents claim to be the successors-in-interest
of the subject land just because they are Z's
grandchildren. Under the law, however,
respondents will only be deemed to have a material
interest over the subject land- and the rest of Z's
estate for that matter if they would have to show
first that their mother: (a) predeceased Z; (b) is
incapacitated to inherit; or (c) was disinherited, if Z
died testate. (Ang v. Pacunio; G.R No. 208928,
2015)
Q: Summarize the rules on sales of conjugal
properties.
A: Sales of conjugal properties by one spouse to
third persons, without the written consent of the
other spouse is void. (Art. 124, FC) The sale is not
merely voidable, since the resulting contract of sale
lacks one of the essential elements of full consent.
The sale will be classified as voidable if there was
only vitiation of the consent of one spouse. (Sps.
Guiang v. Court of Appeals, G.R. No. 125172,
1998)
The sale of property between spouses is void
except in the following instances: (separation of
property)
1. When a separation of property was agreed
upon in the marriage settlements; or
2. When there has been a judicial decree for
the separation of property. (Art. 1490,
NCC)
This prohibition relating to spouses is applicable
even to sales in legal redemption, compromises,
and renunciation. (Art. 1492)
Note: The prohibition applies to sale of property
between common law spouses. (Mercedes
Calimlim- Canullas v. Fortun, G.R. No. L-57499,
1984)
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CIVIL LAW (AND PRACTICAL EXERCISES)
Q: X and Y are heirs of Spouses W and Z.
Spouses W and Z owned Lot 2 which was
registered in W’s name. The land was
eventually subdivided as Lots 2-A, 2-B, and 2-
C in 1984. Sometime later, X discovered that Lot
2-C was sold in 1978 by virtue of a notarized
Deed of Sale to Y in the amount of P150,000.
The Deed did not specify the metes and bounds
of the lot being sold. This prompted X to file a
complaint for annulment of title and
reconveyance against X, alleging that the Deed
of Sale was null and void because the
signatures of Spouses W and Z thereon were
forgeries. The lower courts ruled that the
Spouses Z could not have sold a specific
portion of Lot 2 to petitioners, having been
subdivided only in 1984. Are the lower courts
correct?
A: No. Article 1463 of the Civil Code expressly
states that "[t]he sole owner of a thing may sell an
undivided interest therein." In the case at bar, Lot
2, the original lot, was solely owned by W. As W
was the sole owner of the original Lot 2 from
whence came Lot 2-C, he is therefore allowed by
law to convey or sell an unspecified portion thereof
(Damaso T. Ampray & Ceferino T. Ambray v. Sylvia
A.Tsourous, et al., G.R. No. 209264, 2016).
C. EFFECTS OF THE CONTRACT WHEN
THE THING SOLD HAS BEEN LOST
Q: Who bears the risk of loss/deterioration/fruits
before perfection?
A: The seller is the owner, so he bears risk of loss.
(Art. 1504)
Q: Who bears the risk of loss/deterioration/fruits
after delivery?
A: Delivery extinguishes ownership of the seller and
creates a new one in favor of the buyer and,
therefore, buyer bears risk of loss. (Art. 1504)
D. OBLIGATIONS OF VENDOR
Q: What are the obligations of the seller?
A: The vendor is bound to transfer the ownership
of and deliver, as well as warrant the thing which is
the object of the sale. (Art. 1495,NCC)
Q: What does the seller have to deliver?
A: The seller has to deliver the following:
(Thi-F-A)
1. The thing sold (Art. 1495,NCC);
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2. Fruits, they belong to the buyer from the
day the contract of sale is perfected (Art.
1537);
3. Accessions and accessories, in the
condition in which they were upon the
perfection of the sale. (Art. 1537)
DELIVERY OF THE THING SOLD
Q: When is there Real or Actual Delivery?
A: When it is placed in the control and possession of
the vendee. (Art. 1497)
Q: What are the special remedies of unpaid
seller of goods?
A: When a seller is unpaid as defined in Article
1525 of the Civil Code, whether or not ownership
over the goods has been transferred to the buyer,
the unpaid seller is entitled to the following rights or
remedies:
1. Possessory lien – The unpaid seller has a
right to retain the goods for the price while he
is in possession of them (Art. 1526 (a),NCC);
2. Stoppage in transitut – In case of insolvency
of the buyer, the unpaid seller has the right to
stop the goods in transitu after he has parted
with the possession of them (. 1526
(b),NCC);
3. Special right of resale (Art. 1526 (c),NCC);
4. Special right to rescind (Art. 1526 (d),NCC).
The four remedies have a hierarchical application,
as in fact, the special rights to resell and to rescind
can be availed of by the unpaid seller only when
either of the two prior rights of possessory lien or
stoppage in transitu have been exercised by the
unpaid seller. (VILLANUEVA, Law on Sales, p.
366)
Q: What are the requisites for the rules on
double sales under Art. 1544 to apply?
A: The requisites for double sales are: (2SuV-
2BC-S)
1. The two (or more) sales transactions in
the issue must pertain to exactly the same
Subject matter, and must be Valid sales
transactions.
2. The two (or more) Buyers at odds over
the rightful ownership of the subject
matter must each represent Conflicting
interests; and
3. The two (or more) buyers at odds over the
rightful ownership of the subject matter
must each have bought from the very
same Seller. (Cheng v. Genato, G.R. No.
129760, 1998)
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CIVIL LAW (AND PRACTICAL EXERCISES)
Q: Who shall own the thing sold under a double
sale situation?
A: If the thing is a movable property, the owner is
the first to possess the thing in good faith. (Art.
1544)
Where it is an immovable property that is the
subject of a double sale, ownership shall be
transferred
1. To the person acquiring it who in good faith
first recorded it in the Registry of Property;
2. In default thereof, to the person who in
good faith was first in possession; and
3. In default thereof, to the person who
presents the oldest title, provided there is
good faith. (Art. 1544,NCC; Sps.Gabriel v.
Sps. Mabanta, et al., G.R. No. 142403,
2003)
The requirement of law is two-fold: acquisition in
good faith and registration in good faith. (Sps.
Gabriel v. Sps. Mabanta, et al., G.R. No. 142403,
2003)
General Rule: Every person dealing with
registered land may safely rely on the correctness
of the Certificate of Title issued and the will no way
oblige him to go beyond the certificate to determine
the condition of the property. (Heirs of Sarili v.
Pedro F. Lagrosa, GR No. 193517, 2014)
Exception:
1. However, a higher degree of prudence is
required from one who buys from a
person who is not a registered owner,
although the object of the transaction is
registered (Heirs of Sarili v. Pedro F.
Lagrosa, GR No. 193517, 2014)
2. Where the land sold is in the possession
of a person other than the vendor, as in
this case, the purchaser must go beyond
the certificate of title and make inquiries
concerning the actual possessor. (Norma
C. Magsano v. Pangasinan Savings &
Loan Bank, G.R No. 215038, 2016)
Q: X owned an undivided portion of a lot
registered in the name of Y. On a strength of a
contract to sell, purporting to convey half of his
share to Z, they were able to transfer their
respective rights to Corporation A. X, claiming
that he did not sold his share to Z nor received
any consideration of the said transfer, X sought
to annul the deed of sale. Z insisted that she
paid X and took possession of X’ portion and
declared the same for taxation purposes.
Corporation A, claimed to be a purchaser in
good faith. The RTC declared Corporation A to
be a purchaser in bad faith in view of the
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admission of its representative that he was
aware of the fact that Domingo was part owner
of the subject lot and that he even asked a
someone to talk to X about the sale of his share.
Is the lower court correct?
A: Yes. Verily, one is considered a buyer in bad
faith not only when he purchases real estate with
knowledge of a defect or lack of title in his seller but
also when he has knowledge of facts which should
have alerted him to conduct further inquiry or
investigation. Corporation A cannot veer away from
the admission of its representative,that he was
aware of X’s interest in the subject lot, and that Z
had no title in her name at the time of the sale, thus,
giving rise to the conclusion that it had been
reasonably apprised of the ownership controversy
over the subject lot. Indeed, what it failed to realize
is that, as one asserting the status of a buyer in
good faith and for value, it had the burden of
proving such status, which goes beyond a mere
invocation of the ordinary presumption of good
faith. (Krystle Realty Development Corp v.
Domingo Alibin G.R No. 196117; 2014)
CONDITIONS AND WARRANTIES
Q: What are warranties?
A: These are express or implied statements or
representation made by the seller of goods, as part
of the contract of sale, having reference to the
character, quality, or title, of the goods, where he
promises or undertakes to insure that certain facts
shall be as he represents. (Arts. 1546-1547,NCC)
E. OBLIGATIONS OF VENDEE
Q: In the sale of immovable property, how
should the seller exercise his right to rescind the
sale upon the buyer’s failure to pay the price at
the time agreed upon?
A: The seller should demand for rescission of the
contract either judicially or by notarial act. As long as
there is no demand for rescission, the vendee may
pay even after the expiration of the period agreed
upon. After the demand for rescission, the court
may not grant the buyer a new term. (Art. 1592)
A demand for rescission by judicial or notarial act
(notarized demand letter or notice) is necessary
before a valid rescission can take place, whether or
not automatic rescission has been stipulated.
(Iringan v. Court of Appeals, G.R. No. 129107,
2001)
Note: The requirement of demand by judicial or
notarial act under Article 1592, in case the vendor of
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CIVIL LAW (AND PRACTICAL EXERCISES)
an immovable property wants to rescind, does not
apply to contracts to sell or promise to sell, where
title remains with the vendor until full payment of the
price. (Valarao, et al. v. Court of Appeals, G.R. No.
130347, 1999)
Q: X entered into a Contract to Sell with
Spouses Y for the purchase of 2 parcels of land.
The contract to sell stipulated the purchase
price of P300,000 and imposed upon X the
obligation to pay real property taxes or to
reimburse Spouses Y for any tax payments
made by them. No downpayment was given by
X. However, upon full payment of the P300,000,
Spouses Y undertook to execute a final deed of
sale in favor of X. Meanwhile, X was given
possession of the properties and was allowed
to erect a house thereon. However, before the
payment period expired, X passed away. X’s
heirs now filed a case for specific performance
against Spouses Y, contending that no
downpayment was required of X, X was allowed
to pay whenever she could, and that as of X’s
death, she had already paid for the lot in full.
Spouses Y, on the other hand, contend that X
did not pay downpayment even if it was
required of her, and that X was unable to pay for
the lot in full because of several restructuring
agreements that increased the purchase price.
Hence, Spouses Y cannot be compelled to
execute a deed of sale. Are the Spouses Y
correct?
A: Yes. A contract to sell differs from a conditional
contract of sale. A contract to sell is akin to a
conditional sale where the efficacy or obligatory
force of the vendor's obligation to transfer title is
subordinated to the happening of a future and
uncertain event, so that if the suspensive condition
does not take place, the parties would stand as if
the conditional obligation had never existed. In the
case at bar, Spouses Y had no obligation to
execute a deed of sale as the amount paid by X
was clearly insufficient to cover the principal
amount. In a contract to sell, the fulfillment of the
suspensive condition will not automatically transfer
ownership to the buyer although the property may
have been previously delivered to him. The
prospective seller still has to convey title to the
prospective buyer by entering into a contract of
absolute sale. On the other hand, in a conditional
contract of sale, the fulfillment of the suspensive
condition renders the sale absolute and the
previous delivery of the property has the effect of
automatically transferring the seller’s ownership or
title to the property to the buyer (Heirs of Ventura v.
Sps. Endaya, G.R. No. 190016, 2013).
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Q: X sold a parcel of land to Y on 01 January
2002, payment and delivery to be made on 01
February 2002. It was stipulated that if payment
were not to be made by Y on 01 February 2002,
the sale between the parties would
automatically be rescinded. Y failed to pay on
01 February 2002, but offered to pay three days
later, which payment X refused to accept,
claiming that their contract of sale had already
been rescinded. Is X’s contention correct?
Why?
A: No, X is not correct. In the sale of immovable
property, even though it may have been stipulated,
as in this case, that upon failure to pay the price at
the time agreed upon the rescission of the contract
shall of right take place, the vendee may pay, even
after the expiration of the period, as long as no
demand for rescission of the contract has been
made upon him either judicially or by a notarial act
(Art. 1592,NCC). Since no demand for rescission
was made on Y, either judicially or by a notarial act,
X cannot refuse to accept the payment offered by
Y 3 days after the expiration of the period.
F. BREACH OF CONTRACT
1. REMEDIES
Q: What are the remedies of a seller?
A: The general remedies of a seller are specific
performance with damages or rescission with
damages.
a. Remedies of seller in case of
movables
Q: What is an unpaid seller?
A: A seller of the goods is deemed to be an unpaid
seller either:
(a) When the whole of the price has not been paid
or tendered; or
(b) When the seller received bill of exchange or
negotiable instrument as a condition for
payment and the condition has been broken by
reason of the dishonor of instrument, the
insolvency of the buyer, or otherwise. (Art.
1592,NCC)
Note: Requisites of Unpaid Seller: (PUG)
1. Physical possession is with seller
2. Seller is Unpaid
3. Subject matter – Goods
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Q: What are the special remedies of an unpaid
seller?
A: The special remedies of an unpaid seller are the
ff: (PSRR)
1. Possessory lien
2. Stoppage in Transitu
3. Special right of Re-sale
4. Special right to Rescind (Art. 1526, NCC)
NOTE: Hierarchical Application – only when
unpaid seller has exercised possessory lien or
stoppage in transitu can the seller proceed with his
other special rights of resale or to rescind.
(Villanueva & Tiansay, Law on Sales, 335, 2016)
b. Remedies of seller in case of sale
of immovables
Q: What are the remedies of an unpaid seller
involving a real property as the subject matter,
not covered by the Maceda Law?
1. To compel specific performance by filing an
action against the buyer for the agreed
purchase price; or
2. To rescind or resolve the contract of sale
either judicially or by a notarial act; and
3. In either (1) or (2), to recover damages for
the breach of the contract. (Nuñez, et al. v.
Moises-Palma, G.R. No. 224466, 2019)
c. Remedies of buyer
Q: When is there suspension of payment?
A: The buyer may suspend payment in case he is
disturbed in the possession or ownership of the
thing acquired or he has reasonable grounds to fear
such disturbance (Art. 1590,NCC). But there is no
right to suspension of payment if the seller gives
security for the return of the price (Art. 1590,NCC).
Note: In case of subdivision or condominium
projects, the buyer may rescind the contract or
suspend payment if real estate developer fails to
comply with obligation according to approved plan.
(Sec. 23, P.D. 957)
2. RECTO LAW AND MACEDA LAW
a. Recto Law: Sale of movables on
installment (Arts. 1484-1486)
Q: What is the coverage of the Recto Law?
A: Recto Law covers:
1. Contracts of sale of personal property by
installments (Art. 1484, NCC);
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2. Contracts purporting to be leases of
personal property with option to buy, when
the lessor has deprived the lessee of the
possession or enjoyment of the thing (Art.
1485, NCC).
Note: In case of financing transactions derived or
arising from sale of movables on installments, the
financing company is bound by the Recto Law, if the
seller is the agent of the financing company or when
the seller assigned his credit to the financing
company. (Eutropio Zayas, Jr. v. Luneta Motor
Company, G.R. No. L-30583, 1982) However, the
Recto Law will not apply to the financing company,
if it merely financed the purchase of the subject
property under a contract of loan and the buyer
bought the property from a third party. In other
words, the Recto Law will not apply when there is no
vendor-vendee relationship between the parties, as
in a contract of loan with chattel mortgage where the
relationship of the parties is that of a debtor
(mortgagor)-creditor (mortgagee). (Equitable
Savings Bank, Inc. v. Rosalinda C.Palces, G.R. No.
214752, 2016)
Note: Contracts to sell are not covered by the Recto
Law. (Visayan Sawmill Co. v. Court of Appeals, G.R.
No. 83851, 1993)
Q: What are the remedies of a seller under the
Recto Law?
A: In case of default, the following remedies are
available to the seller:
1. Exact fulfillment of the obligation, should
the buyer fail to pay;
2. Cancel the sale, if the buyer fails to pay 2
or more installments;
3. Foreclose the chattel mortgage on the
thing sold, if the buyer fails to pay 2 or
more installments;
In case of foreclosure, the seller shall
have no further action against the
buyer to recover any unpaid balance
of the price and any agreement to the
contrary shall be void. (Art. 1484)
These remedies are alternative and exclusive, and
the exercise of one would bar the exercise of the
others. (Delta Motor Sales Corp. v. Niu Kim Duan,
G.R. No. 61043,1992)
Q: Y purchased a car from Bank X in the amount
of P1 million. In connection therewith, Y
executed a Promissory Note with Chattel
Mortgage in favor of Bank X, and stipulated that
Y will pay the amount in 36-monthly
installments. Y eventually defaulted on her
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CIVIL LAW (AND PRACTICAL EXERCISES)
installments, prompting Bank X to send her a
demand letter and file a complaint for Recovery
of Possession with Replevin. Y, for her part,
admitted that she defaulted payment for the
months of January and February but called Bank
X’s officer who consented to a delayed payment
scheme. Y made payments in the amount of
P103,000 in March but was surprised when Bank
X filed the instant complaint. Y contends that
Bank X had already waived its right to recover
any unpaid installments when it sought for a writ
of replevin in order to gain possession of the
subject vehicle. Is Y correct?
A: No. Article 1484 provides that in cases of a
contract of sale of personal property the price of
which is payable in installments, “the vendor may
exercise: (1) exact fulfillment of the obligation,
should the vendee fail to pay; (2) cancel the sale,
should the vendee's failure to pay cover two or more
installments; and (3) foreclose the chattel mortgage
on the thing sold if one has been constituted, should
the vendee's failure to pay cover two or more
installments. In this case, he shall have no further
action against the purchaser to recover any unpaid
balance of the price. Any agreement to the contrary
shall be void.” In the present case, there was no
vendor-vendee relationship between Bank X and Y
as Y did not buy the car from Bank X but merely
sought financing from the latter. Only a vendor may
exercise the remedies provided for under Art. 1484
(Equitable Savings Bank v. Palces, G.R. No.
214752, 2016).
Exception: Even if the seller had chosen specific
performance, if the same has become impossible,
the seller may still choose rescission. (Art.
1191,NCC).
b. Maceda Law (R.A. 6552)
Q: What is the coverage of the Maceda Law or
the Realty Installment Buyer Protection Act?
A: It covers all contracts involving the sale or
financing of real estate on installment payments,
including residential condominium apartments.
(Sec. 3, R.A. No. 6552)
It does not apply to sales of:
1. Industrial lots;
2. Commercial buildings and lots; and
3. Sales to tenants under agrarian reform
laws (Sec. 3, R.A. 6552)
Q: What are the rights granted to the buyer
under the Maceda Law, in case he defaults in the
payment of installments?
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A: If the buyer has paid at least 2 years of
installments:
1. Pay the unpaid installments due without
additional interests, within the grace period.
The grace period is 1 month for every year
of installment payments made. This right
shall be exercised only once every 5 years
of the life of the contract and its extensions.
2. Cancel the contract and receive 50% of the
cash surrender value of the total payments
made as refund.
a. Receive additional refund of 5%
for every year exceeding 5 years,
if the buyer has paid more than 5
years of installments, provided that
the total amount to be refunded
shall not exceed 90% of the total
payments made. (Sec. 3, R.A.
6552)
If the buyer has paid less than 2 years of
installments:
 The buyer has the right to a grace period of
not less than 60 days from the date the
installment became due. (Sec. 4, R.A.
6552)
However, if the buyer fails to pay the installments
due at the expiration of the grace period, the seller
has to give a notice of cancellation or demand
rescission of the contract by a notarial act from the
buyer, and only after 30 days from the buyer’s
receipt of such can the seller cancel the contract. (
Sec. 4, R.A. 6552)
3. OTHER REMEDIES
a. Remedies in double sales
Q: What are the requisites for a double sales to
exist?
A: The requisites for a double sales to exist are the
following:
1. That two (or more) sales transactions in the
issue must pertain to exactly the same subject
matter, and must be valid sales transactions.
2. That two (or more) buyers at odds over the
rightful ownership of the subject matter must
each represent conflicting interests; and
3. That two (or more) buyers at odds over the
rightful ownership of the subject matter must
each have bought from the very same seller.
(Sps. German v. Sps. Santuyo, G.R. No.
210845,2020)
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CIVIL LAW (AND PRACTICAL EXERCISES)
Q: What are the rules on double sales
according to Art. 1544?
A: The double sales rules according to Art. 1544
are the following:
1. Movable
First to possess in good faith shall prevail (Art.
1544,NCC)
2. Immovable
(a) First to register in good faith shall prevail;
(b) In case no registration is made, then first to
possess in good faith shall prevail;
(c) No registration and no possession in good
faith, then the person who presents oldest title
in good faith, shall prevail. (Art. 1544,NCC)
NOTE: The FIRST BUYER is always in good faith
and will always prevail if he registers his sale first.
His good faith is not destroyed by the subsequent
knowledge of the second sale. The reason behind
this is that at the time of perfection of his contract of
sale, he was the only buyer. (Rosario Carbonell v.
Court of Appeals, G.R. No. L-29972, 1976) But the
knowledge gained by the 2nd buyer of the first sale
defeats his rights even if he is first to register, since
such knowledge taints his registration with bad faith.
(Anthony Orduna, et al. v. Eduardo Fuentebella, et
al., G.R. No. 176841, 2010)
b. Remedy of rescission in
contracts covering immovables
(Arts. 1191 & 1592)
Q: What are the rules on rescission in contracts
covering immovables?
A: The general rule is judicial rescission (Art.
1191,NCC). However, as an exception, extrajudicial
rescission is allowed but subject to court
Confirmation.
G. EXTINGUISHMENT
1. IN GENERAL
Q: How is a sale extinguished?
A: Sales are extinguished by the same causes as
all other obligations such as: (CIVIL CODE, Art.
1600) (PLC3 – NARFP-CL)
1. Payment or performance
2. Loss of the subject matter
3. Condonation or remission
4. Confusion or merger of rights of creditor and
debtor
5. Compensation
6. Novation
7. Annulment
8. Rescission
9. Fulfillment of a resolutory condition
10. Prescription
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11. Conventional Redemption
12. Legal Redemption (Art. 1231)
2. PACTO DE RETRO/CONVENTIONAL
REDEMPTION (SALE WITH RIGHT TO
REPURCHASE)
Q: When is a contract presumed to be an
equitable mortgage?
A: The contract shall be presumed to be an
equitable mortgage, in any of the following cases:
(P2-In-R-T-S)
1. When the Price of a sale with right to
repurchase is unusually inadequate;
2. When the vendor remains in Possession
as lessee or otherwise;
3. When upon or after the expiration of the
right to repurchase another Instrument
extending the period of redemption or
granting a new period is executed;
4. When the purchaser Retains for himself a
part of the purchase price;
5. When the vendor binds himself to pay the
Taxes on the thing sold;
6. In any other case where it may be fairly
inferred that the real intention of the parties
is that the transaction shall Secure the
payment of a debt or the performance of
any other obligation.
In any of the foregoing cases, any money, fruits, or
other benefit to be received by the vendee as rent
or otherwise shall be considered as interest which
shall be subject to the usury laws. (Art. 1602,NCC)
There is conventional redemption when the seller
reserved for himself the right to repurchase the thing
sold, with the obligation to return:
1. The price of the sale;
2. The expenses of contract,
3. Other legitimate payments,
4. The necessary and useful expenses made on
the thing sold (Art. 1601,NCC)
Q: What are the rules on the period within which
to exercise the right to repurchase under Article
1601?
AGREEMENT PERIOD
No express Vendor may redeem within 4
agreement on years from the date of the
the period contract ( Art.
1606 par. 1,NCC)
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CIVIL LAW (AND PRACTICAL EXERCISES)
Express Vendor may redeem within
agreement on the period agreed upon,
the period which shall not exceed 10
years. (Art. 1606 par. 2,NCC)
However, the vendor may still exercise the right to
repurchase within 30 days from the time final
judgment was rendered in a civil action on the basis
that the contract was a true sale with right to
repurchase. (Art. 1606 par. 3,NCC)
Q: X obtained a loan from Lending Corporation
A, which was secured by a real estate mortgage
over a parcel of land. X defaulted in the
payment, prompting Lending Corporation A to
extra-judicially foreclose the mortgage. Being
the highest bidder in the auction, Lending
Corporation A acquired the land and a
Certificate of Sale was registered with the
Registry of Deeds. X failed to redeem the subject
property within the one-year reglementary
period causing Lending Corporation A to
demand X to vacate the property, but to no avail.
X is claiming that he still has one year to redeem
the land pursuant to Republic Act 720,
otherwise known as the Rural Banks Act. Is X
correct?
A: No. In an extra-judicial foreclosure of registered
land, the mortgagor may redeem the property
within 2 years from the date of foreclosure if the
land is mortgaged to a rural bank under Republic
Act 720, or within 1 year from the registration of the
certificate of sale if the land is mortgage to parties
other than rural banks pursuant to Act No. 3135. If
the mortgagor fails to exercise such right, he or his
heirs may still repurchase the property within 5
years from the expiration of the aforementioned
redemption period pursuant to Section 119 of the
Public Land Act. In the case at bar, the subject
property was mortgaged and foreclosed by a
lending institution, not a rural bank; hence, the
redemption period is only one year from the
registration of the certificate of sale. Given that X
failed to redeem the subject property within the
aforestated redemption period, Lending
Corporation A is entitled, as a matter of right, to
consolidate its ownership and possess the same.
Nonetheless, such right should not negate X’s right
to repurchase said property within 5 years from the
expiration of the redemption period. (Sps. Guevarra
v. The Commoner Lending Corporation, Inc., GR
No. 204672, 2015)
3. EQUITABLE MORTGAGE
Q: What are the essential requisites of an
equitable mortgage?
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A: The essential requisites of an equitable

mortgage are: Note: Co-owners with actual notice of the sale are
1. The parties entered into a contract denominated not entitled to written notice. (Sps. Si v. Court of
as a contract of sale; and Appeals, G.R. No. 122047, 2000)
2. Their intention was to secure an existing debt by
way of a mortgage. (Pedro Molina vs. Court of Q: When does the period to exercise legal
Appeals, G.R. No. 125755, 2003) redemption begin?
A: The 30-day period to exercise legal redemption
A contract with right to repurchase may be deemed only commences from the written notice given by
to be an equitable mortgage under the following the seller to all possible redemptioners. (Art.
conditions (IPERTI): 1623,nCC)
1. Price of sale with right to repurchase is
unusually Inadequate Q: What is the difference between Conventional
2. Seller remains in Possession as lessee or Redemption and Legal Redemption?
otherwise
3. Upon or after expiration of right to repurchase, CONVENTIONAL LEGAL
another instrument Extending the period of REDEMPTION REDEMPTION
redemption or granting new period is executed By express agreement, The right to be
4. Buyer Retains for himself a part of the purchase the seller is given the subrogated upon the
price right to repurchase the same terms and
5. Seller binds himself to pay Taxes on thing sold thing sold (Art. 1600). conditions stipulated in
6. Any other case where the real Intention of the contract, in the
parties is to secure the payment of a debt or place of one who
performance of other obligation (Art. acquires the thing by
1602,NCC) (1) purchase OR (2)
by dation in payment
4. LEGAL REDEMPTION OR (3) by other
transaction whereby
Q: Explain the right of legal redemption among ownership is
co-owners. transmitted by onerous
A: A co-owner may exercise the right of redemption title. (Art. 1619)
in case the shares of all the other co- owners or of
any of them, are sold to a third person. If the price
for the sale is grossly excessive, the redemptioner
shall pay only a reasonable one. (Art. 1620) H. ASSIGNMENT OF CREDITS

Should two or more co-owners desire to exercise Q: What is assignment of credit?

the right of redemption, they may only do so in
proportion to the share they may respectively have
in the thing owned in common. (Art. 1620)
The requisites for the exercise of legal redemption
among co-owners are: (Co-St-BP- CoPerN-R)
1. There must be Co-ownership at the time of
the conveyance of the property;
2. One of the co-owners sold his right to a
Stranger;
3. The sale was made Before the Partition of
the co-owned property;
4. The right of redemption must be exercised
by one or more Co-owners within a Period of
thirty days to be counted from the time he or
they were Notified in writing by the co-owner
seller; and
5. The buyer must be Reimbursed the price of
the sale. (Francisco G. Calma v. Arsenio
Santos, et al., G.R. No. 161027, 2009)
A: The owner of a credit transfers to another his
rights and actions in consideration of a price
certain in money or its equivalent
1. Transfers the right to collect the full value of
the credit, even if he paid a price less than
such value;
2. Transfers all the accessory rights (e.g.
guaranty, mortgage, pledge, preference) (Art.
1427,NCC);
3. Debtor can set up against the assignee all the
defenses he could have set up against the
assignor.
Q: What is the effect of payment of debtor
after assignment of credits?
1. Before Notice of the Assignment – Payment
to the original creditor is valid and debtor
shall be released from his obligation
2. After Notice – Payment to the original
creditor is not valid as against the assignee.

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He may be made to pay again by the

assignee (Art. 1626,NCC)

Q: What are the warranties of the assignor?

1. NO warranty against hidden defect – N/A
because intangibles have no physical
existence (Villanueva & Tiansay, Law on
Sales, 532, 2016)
2. He warrants the existence and legality of
credit – there is warranty except when
expressly sold as a doubtful account
3. NO warranty as to the solvency of debtor
unless it is expressly stipulated OR unless
the insolvency was already existing and of
public knowledge at the time of the
assignment (Art. 1628,NCC)

NOTE:
Warranty shall last for 1 year only (Art.
1629,NCC)

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SALES

Elements of a CSP The elements of a contract of sale are:

Contract of Sale 1. Consent
2. Determinate or Determinable Subject Matter
3. Price certain in money or its equivalent
(Romulo A.Coronel, et al., v. Court of
Appeals, G.R. No. 103577, 1996)

Requisites of a Valid RMC The price or consideration of a contract of sale must

Price have the following requisites at the time of the
perfection of the sale:
1. It must be Real ( Art. 1471,NCC);
2. It must be in Money or its equivalent,
valueable consideration (Art. 1458 and
1468,NCC);
3. It must be Certain or ascertainable (Art.
1458,NCC)

Stages in a Life of a NPC The stages in a life of a sale are:

Sale 1. Policitacion/Negotiation Stage – Starts from
the time the prospective contracting parties
indicate interest in the contract to the time the
contract is perfected;
2. Perfection – Takes place upon the
concurrence of the essential elements of the
sale, which are metting of the minds as to the
object of the contract and upon the price;
3. Consummation – Begins when the parties
perform their respective undertaking under
the contract of sale, culminating in the
extinguishment of the contract of sale. (San
Miguel Properties Philippines v. Sps. Huang,
G.R. No. 137290, 2000)

Elements of an A-Su-C The elements of an option contract are:

Option Contract 1. Acceptance of the offer to buy or sell;
2. A determinate Subject matter for a price
certain;
3. Consideration, which is separate and distinct
from the purchase price. (Art. 1479, par.
2,NCC)

Persons M-I-D-DRUNK-SPELL The following persons are incapacitared to enter into

Incapacitated to a contract of sale because of their incapacity to give
enter into a Contract consent:
of Sale 1. Minors (Art. 1327,NCC)
2. Insane and Demented Persons (Art.
1327,NCC)
However, when the contract is entered into
during a lucid interval the contract is valid.
(Art. 1328,NCC)

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3. Deaf-Mutes (Art. 1327,NCC)

4. Persons who entered into a contract in a state
of DRUNKenness and hypnotic SPELL(Art.
1328,NCC)

Things that the Thi-F-A The seller has to deliver the following:
Seller must Deliver 1. The Thing sold (Art. 1495,NCC)
2. Fruits, they belong to the buyer from the day
the contract of sale is perfected (Art.
1537,NCC)
3. Accessions and accessories, in the condition
in which they were upon the perfection of the
sale (Art. 1537,NCC)

Requisites for the 2SuV-2BC-S The requisites for double sales are:
Rules on Double 1. The two (or more) sales transactions in the
Sales issue must pertain to exactly the same
Subject matter, and must be Valid sales
transactions.
2. The two (or more) Buyers at odds over the
rightful ownership of the subject matter must
each represent Conflicting interests; and
3. The two (or more) buyers at odds over the
rightful ownership of the subject matter must
each have bought from the very same Seller.
(Ricardo Cheng v. Ramon Genato Sps. Da
Jose, G.R. No. 129760, 1998)
Presumptions of P2-I-R-T-S The contract shall be presumed to be an equitable
Equitable Mortgage mortgage, in any of the following cases:
1. When the Price of a sale with right to
repurchase is unusually inadequate;
2. When the vendor remains in Possession as
lessee or otherwise;
3. When upon or after the expiration of the right
to repurchase another Instrument extending
the period of redemption or granting a new
period is executed;
4. When the purchaser Retains for himself a part
of the purchase price;
5. When the vendor binds himself to pay the
Taxes on the thing sold;
6. In any other case where it may be fairly
inferred that the real intention of the parties is
that the transaction shall Secure the payment
of a debt or the performance of any other
obligation. (Art. 1602,NCC)

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Requisites for the Co-St-BP-CoPerN-R 1. There must be Co-ownership at the time of

Exercise of Legal the conveyance of the property;
Redemption among 2. One of the co-owners sold his right to a
Co-owners Stranger;
3. The sale was made Before the Partition of the
co-owned property;
4. The right of redemption must be exercised by
one or more Co-owners within a Period of
thirty days to be counted from the time he or
they were Notified in writing by the co-owner
seller; and
5. The buyer must be Reimbursed the price of
the sale. (Francisco Calma v. Arsenio Santos,
et al., G.R. No. 161027, 2009)

VI. LEASE Lessor’s services Lessor has to deliver

must still be paid the thing leased.
even if the result In case of breach,
A. GENERAL PROVISIONS intended is not there may be an
attained. action for specific
Q: What is a contract of lease?
In case of breach, no performance
A: A contract of lease is a contract by which one
action for specific
agrees to give to the other for a fixed time and price
the use or profit of a thing, or of his services. (The
performance
Employees’ Club, Inc. v. China Banking
Corporation, G.R. No. L-40188, 1934) B. RIGHTS AND OBLIGATIONS OF THE
LESSOR AND OF THE LESSEE
Q: What are the Characteristics of Lease of
things? 1. OBLIGATIONS OF THE LESSOR
(Art. 1654,NCC) (DNM)
A: Characteristics of Lease of things (CLONS-
PEP-TP) Q: What are the obligations of the lessor?
(a) Consensual 1. To Deliver the thing which is the object of the
(b) Lessor need not be the owner contract in such condition as to render it fit for
(c) Onerous the use intended.
(d) Nominate 2. To make on the same during the lease all the
(e) Subject matter must be within the commerce of Necessary repairs in order to keep it suitable for
man (i.e. not belonging to public domain) the use to which it has been devoted unless
(f) Principal contract there is a stipulation to the contrary.
(g) Purpose is to allow enjoyment or use of a thing 3. To Maintain the lessee in the peaceful and
(h) Purpose to which the thing will be devoted adequate enjoyment of the lease for the entire
should not be immoral duration of the contract.
(i) Period is temporary  This is true only if the contract is valid.
(j) Period may be definite or indefinite Where the contract is void, for having an
existent contract of lease, the lessor has no
1. LEASE OF WORK AND SERVICES right to lease the same property. (Pedro T.
Bercero v. Capitol Development
Q: Differentiate a contract of lease of service Corporation, G.R. No. 154765, 2007)
and a contract of lease of thing?
CONTRACT OF CONTRACT OF 2. OBLIGATIONS OF THE LESSEE
LEASE OF SERVICE LEASE OF THING (Art. 1657) (PUP)
The object of contract The object of contract
is the service itself is a thing Q: What are the obligations of the lessee?
and not the result 1. Pay the price of the lease according to the terms
which it generates stipulated.

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2. Use the thing leased as a diligent father of a Subleasing is allowed Assignment is not
family devoting it to the use stipulated, and in unless there is an allowed unless the
the absence of stipulation, to that which may be express prohibition. lessor gives his
inferred from the nature of the thing leased, consent.
according to the custom of the place.
3. Pay the expenses for the deed of lease. ————- end of topic————-

Q: What are the rights of the lessee?

1. Right to be respected in his possession.
2. Right to be restored to said possession by the
VII. PARTNERSHIPS
means established by law or by the Rules of
Court, should he be disturbed therein. A. GENERAL PROVISIONS

Q: What are the effects if lessor fails to make
urgent repairs?
A: The lessee may (ROSS):
(a) Ask for Rescission, in case of substantial
damage to him.
(b) Order repairs at the lessor’s cost;
(c) Sue for damages; or
(d) Suspend the payment of the rent;
Q: What are the kinds of trespass in lease?
(a) Trespass in fact (perturbacion de mere
hecho):
 Lessor is not liable for the mere fact of a
trespass or trespass in fact made by a third
person of a leased property.
 Mere fact or mere act of trespass is when
the third person claims no right whatever.
 Physical enjoyment is reduced.
Q: In 1993, Pedro started working as the
caretaker of the Ralco Beach, a beach resort
then operated by the parents of Emmarck.As
caretaker and the only employee, Pedro cleaned,
watched, and secured the beach area, cottages,
rest house, store, and other properties in the
resort. He also entertained guests and
occupants of the cottages. He worked from 5
a.m. to 9 p.m. every day, including weekends
and holidays, and was given an allowance.
In 2007, Pedro’s wife, Maricel, was also
employed by Emmarck to manage the store in
the resort. For her services, she was paid
P1,000.00 a month and entitled to 15%
commission on the rentals collected from the
cottages and rest house. Like Pedro, she also
worked from 5 a.m. to 9 p.m. every day.

(b) Trespass in law (perturbacion de derecho): Sometime in July 2008, Emmarck notified Pedro
 A third person claims legal right to enjoy the and Maricel that he will be leasing out Ralco
premises Beach because the business was not profitable.
 Lessor will be held liable Thus, their services are no longer needed. The
two filed a labor case for illegal dismissal.
Q: Differentiate a sublease and an assignment
of lease. Emmarck denied the employment relationship
with Pedro and Maricel, and asserted that they
SUBLEASE ASSIGNMENT OF were his industrial partners. Emmarck explained
LEASE that Pedro was given a weekly allowance of
Lessee remains a Lessee is P230.00 as industrial partner and overseer.
party in the contract. disassociated from the Similarly, Maricel was taken in as an industrial
original contract of partner to manage the store inside the beach
lease. property, and paid a monthly allowance and
Two leases and two Only one (lessor- commission on the rent of the resort facilities.
distinct juridical assignee who She was also allowed to sell anything in the
relationship (lessor- becomes the lessee) store with the profits solely belonging to her.
lessee and sublessor- because lessee
sublessee). transmits absolutely Were Pedro and Maricel employees or partners
his rights and his of Emmarck?
personality
disappears. A: Undoubtedly, thef best evidence to prove the
existence of a partnership is the contract or articles
Sublessee does not Assignee has a direct
of partnership. Nevertheless, in its absence, its
have any direct action action against the
existence can be established by circumstantial
against the lessor. lessor, there being
evidence. Under Article 1769 of the Civil Code, "the
novation.

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receipt by a person of a share of the profits of a
business is a prima facie evidence that he is a
partner in the business, [but] no such inference shall
be drawn if such profits were received in payment
as wages of an employee [or rent to a landlord]."
In addition, "the sharing of gross returns does not of
itself establish a partnership, whether or not the
persons sharing them have a joint or common right
or interest in any property from which the returns are
derived.“
Here, it is undisputed that Pedro and Maricel
rendered their services in Ralco Beach and received
compensation sourced from rentals and sales of the
resort. The crux of controversy is the nature by
which Pedro and Maricel rendered their services
and the capacity by which they received their
compensation. There is no proof that a partnership
existed and Emmarck relied solely on his own
statements that Pedro and Maricel did not receive
wages, but merely allowances and commission from
the profits of their partnership.
However, it is beyond dispute that receipt by a
person of share in the profits of a business does not
by itself establish the existence of a partnership, if
the amounts are received as wages of an employee.
Neither does the sharing of gross returns establish
partnership, most especially, in light of the absence
of the any other evidence to establish the existence
of the partnership.
In Santiago v. Spouses Garcia, the Court ruled that
no partnership existed because there was no
"unmistakable intention to form a partnership." As in
this case, there is no clear indication that the parties
agreed to contribute money, property or industry to
engage in particular business. Aside from
Emmarck's self-serving statements, no other piece
of evidence was presented to prove their intent to
form a partnership. Neither did Emmarck bother to
specify his supposed contributions to the
partnership. In addition, there is no proof that there
was an intention to divide the profits as partners.
The absence of this intention is exemplified by the
lack of sharing of profits. (Dusol v Lazo, G.R. No.
200555, January 20, 2021)
Q: Saludo Agpalo Fernandez and Aquino Law
Office (SAFA Law Office) entered into a Contract
of Lease with PNB. SAFA Law occupied the
leased premises until 2005 but stopped paying
rent on 2002. A demand letter sent by PNB for
almost 11 million pesos in rental arrears was
responded by SAFA law with a proposal with a
range of suggested computations, with
deduction for improvements, offset for
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CIVIL LAW (AND PRACTICAL EXERCISES)
professional fees and an alleged 50% discount
promised by Dr. Lucio Tan.
Saludo then, in his capacity as managing
partner of SAFA Law filed a complaint for
accounting and/or re- computation of unpaid
rentals and damages against PNB. PNB filed a
motion include SAFA Law Office as principal
plaintiff.
While SAFA Law registered its Articles of
Partnership with the SEC, Saludo asserts that
SAFA Law Office is a sole proprietorship on the
basis of the MOU executed by the partners of the
firm after it was registered as a partnership.
This MOU provides:
 the actual and real intent of the parties
that all liabilities shall be solely for
Saludo’s account and all remaining
assets upon dissolution shall accrue
exclusively to him and,
 the other partners, who are industrial
partners, shall not in any way be liable
for any loss or liability that may be
incurred by the law firm in the course of
its operation.
Does the MOU effectively reconstitute the SAFA
Law Office from a partnership to a single
proprietorship? (Note the MOU establishes that
there is no sharing of loses.)
A: No. Absent evidence of an earlier agreement,
SAFA Law Office was constituted as a partnership
at the time its partners signed the Articles of
Partnership wherein they bound themselves to
establish a partnership for the practice of law,
contribute capital and industry for the purpose, and
receive compensation and benefits in the course of
its operation.
The MOU evinces the parties' intention to entirely
shift any liability that may be incurred by SAFA Law
Office in the course of its operation to Saludo, who
shall also receive all the remaining assets of the firm
upon its dissolution. This MOU, however, does not
serve to convert SAFA Law Office into a sole
proprietorship. The MOU, from its tenor, reinforces
this fact. It did not change the nature of the
organization of SAFA Law Office but only excused
the industrial partners from liability.
The law, in its wisdom, recognized the possibility
that partners in a partnership may decide to place a
limit on their individual accountability.
Consequently, to protect third persons dealing with
the partnership, the law provides a rule, embodied
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in Article 1816 of the Civil Code. The foregoing
provision does not prevent partners from agreeing
to limit their liability, but such agreement may only
be valid as among them. The MOU is an agreement
forged under the foregoing provision. Consequently,
the sole liability being undertaken by Saludo serves
to bind only the parties to the MOU, but never third
persons like PNB.
Considering that the MOU is sanctioned by the law
on partnership, it cannot change the nature of a
duly- constituted partnership. Hence, we cannot
sustain Saludo's position that SAFA Law Office is a
sole proprietorship. Having settled that SAFA Law
Office is a partnership, we hold that it acquired
juridical personality by operation of law. The
perfection and validity of a contract of partnership
brings about the creation of a juridical person
separate and distinct from the individuals
comprising the partnership. (Saludo v. Phil. National
Bank, 878 SCRA 43 (2018))
PARTNERSHIP vs. LOAN vs. INVESTMENT
CONTRACT
Q: Merian B. Santiago (Merian) was enticed by
respondent Edna L. Garcia (Edna) to invest
money in the latter's lending business with a
promise of a high return in terms of monthly
interest ranging from 5% to 8%. The parties
agreed that monthly interest shall be remitted by
Edna to Merian and that the principal amount
invested shall be returned to Merian upon
demand. Their agreement was not reduced into
writing. The funds invested by Merian into
Edna’s lending business shall be used to grant
loans to other persons.
Merian began investing several amounts
reaching an aggregate amount of P1,569,000.00.
Edna had remitted to Merian the amount of
P877,000.00 as interest on said amounts.
However, in December 2003, Edna defaulted in
remitting to Merian the interest due from said
investments.
After several demands were made and ignored
court action ensued. Edna, in her defense claim
that the amounts given to her were investments
and not loans.
Was there a partnership formed between Merian
and Edna — the former as capitalist partner and
the latter as industrial partner?
A: A partnership, a simple contract of loan, and an
investment contract carry peculiar definitions and
are governed by pertinent laws. The existence of a
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CIVIL LAW (AND PRACTICAL EXERCISES)
partnership, simple loan, or an investment contract
should not, therefore, be inferred lightly, especially
where any of its requisite elements are lacking.
The Court cannot subscribe to the view that Merian
and Edna formed a partnership.
By the contract of partnership two or more persons
bind themselves to contribute money, property, or
industry to a common fund, with the intention of
dividing the profits among themselves. Partnership
is essentially a result of an agreement or a contract,
either express or implied, oral or in writing, between
two or more persons.
Here, there was neither allegation nor proof that
Merian and Edna agreed to enter into a partnership
for purposes of carrying out the lending business.
There was likewise no agreement for the sharing of
profits, only that Merian expects to receive
remittance of monthly interest from the amount she
invested.
At any rate, the receipt by a person of a share of the
profits, or of a payment of a contingent amount in
case of profits earned, is not a conclusive evidence
of partnership. Article (Art.) 1769 (3) of the Civil
Code provides that "the sharing of gross returns
does not of itself establish a partnership, whether or
not the persons sharing them have a joint or
common right or interest in any property from which
the returns are derived." There must be an
unmistakable intention to form a partnership which
is lacking in this case.
Most importantly, the facts do not disclose that there
is mutual agency between Merian and Edna, that is,
neither party alleged that she can bind by her acts
the other, and can be bound by the acts of the other
in the ordinary course of business.
The facts of the instant case do not support the
conclusion that the parties entered into a contract of
loan either. The facts therefore demonstrate that
Edna was engaged in the business of lending and
that she solicited funds from Merian which Edna
then used to grant loans to other persons.
The parties' contemporaneous and subsequent acts
reveal their intent to enter into an investment
contract in a lending business. Having established
that the transaction between Merian and Edna is
one of investment in a lending business, the
question to be addressed is whether Edna is
contractually bound to return Merian's capital.
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Investment is ordinarily defined as the placement of
capital or lay out of money in a way intended to
secure income or profit from its employment.
Even assuming that the agreement between the
parties was that Merian shall bear the risk of losing
the principal amount she invested, in case of
business loss, there was no allegation nor proof
presented that, indeed, Edna's lending business
suffered business loss. Thus, the principal amount
should be returned to Merian. (Santiago v. Spouses
Garcia, G.R. No. 228356, 09 March 2020)
JOINT VENTURES
Q: Mabuhay Holdings Corporation (Mabuhay)
and Infrastructure Development & Holdings, Inc.
(IDHI) are Philippine corporations and
Sembcorp Logistics Limited (Sembcorp), is
Singapore corporation. Mabuhay and IDHI
incorporated Water Jet Shipping Corporation
(WJSC) in the Philippines to engage in the
venture of carrying passengers on a common
carriage by inter-island fast ferry. They also
incorporated Water Jet Netherlands Antilles,
N.Y. (WJNA) in Curasao, Netherlands.
Mabuhay, IDHI, and Sembcorp entered into a
Shareholders' Agreement in connection with a
planned business expansion of WJSC and
WJNA. Pursuant to Agreement, Mabuhay and
IDHI agreed to jointly guarantee that Sembcorp
would receive a minimum accounting return of
(Guaranteed Return) at the end of the 24th
month following the full disbursement of the
Sembcorp's equity investment in WJNA and
WJSC. Sembcorp had to litigate for the payment
of the Guaranteed Return and Sembcorp
secured an arbitral award against Mabuhay and
Mabuhay was ordered to pay half of the
Guaranteed Return plus interest at the rate of
12% per annum.
Is the payment of the Guaranteed Return to
Sembcorp a violation of Article 1799 of the Civil
Code, as it shields the latter from sharing in the
losses of the partnership?
Article 1799. A stipulation which excludes one or
more partners from any share in the profits or losses
is void. (1691)
A: No. The joint venture between Mabuhay, IDHI,
and Sembcorp was pursued under the Joint Venture
Corporations, WJSC and WJNA. By choosing to
adopt a corporate entity as the medium to pursue
the joint venture enterprise, the parties to the joint
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CIVIL LAW (AND PRACTICAL EXERCISES)
venture are bound by corporate law principles under
which the entity must operate.
Among these principles is the limited liability
doctrine. The use of a joint venture corporation
allows the co- venturers to take full advantage of the
limited liability feature of the corporate vehicle which
is not present in a formal partnership arrangement.
In fine, Mabuhay's application of Article 1799 is
erroneous. (Mabuhay Holdings Corp. v. Sembcorp
Logistics Ltd., 888 SCRA 364 (2018))
B. OBLIGATIONS OF THE PARTNERS
Q: What are the voting requirements in case of
disagreement by the partners in charge of the
administration without specification of their
respective duties or without a stipulation that
one of them shall not act without the consent of
the others?
A: The decision of majority (of the partners
entrusted to administer) shall prevail. In case of a
tie, the matter shall be decided by the partners
owning the controlling interest. (Art. 1801)
Article 1769. In determining whether a partnership
exists, these rules shall apply:
(1) Except as provided by article
1825, persons who are not
partners as to each other are not
partners as to third persons;
(2) Co-ownership or co-possession
does not of itself establish a
partnership, whether such-co-
owners or co-possessors do or do
not share any profits made by the
use of the property;
(3) The sharing of gross returns does
not of itself establish a partnership,
whether or not the persons sharing
them have a joint or common right
or interest in any property from
which the returns are derived;
(4) The receipt by a person of a share
of the profits of a business is prima
facie evidence that he is a partner
in the business, but no such
inference shall be drawn if such
profits were received in payment:
(a) As a debt by installments or
otherwise;
(b) As wages of an employee or
rent to a landlord;
(c) As an annuity to a widow or
representative of a deceased
partner;
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(d) As interest on a loan, though When manner of No participation in

the amount of payment vary management not management (CIVIL
with the profits of the agreed upon, all have CODE, Art. 1848)
business; an equal right in the
(e) As the consideration for the management of the
sale of a goodwill of a business (CIVIL CODE,
business or other property by Art. 1803)
installments or otherwise. (n) Contribute cash, Contribute cash or
(UPA§6) property or industry property only, not
(CIVIL CODE, Art. industry (CIVIL CODE,
C. DISSOLUTION AND WINDING UP 1767) Art. 1845)
Proper party to Not proper party to
Q: What is dissolution? proceedings by/ proceedings by/
A: Dissolution is the change in the relation of the against partnership against partnership
partners caused by any partner ceasing to be (CIVIL CODE, Art. (CIVIL CODE, Art.
associated in the carrying on of the business; 1866) 1866)
partnership is not terminated but continues until the Interest not Interest is freely
winding up of partnership affairs is completed. (CIVIL assignable w/o assignable (CIVIL
CODE, Art. 1828) consent of other CODE, Art. 1859)
partners (CIVIL CODE,
Q: What is winding up? Art. 1804)
A: Winding up is the process of settling the Name may appear in Name must not
business or partnership affairs after dissolution, firm name (CIVIL appear in firm name
which includes the paying of previous obligations, CODE, Art. 1815) (CIVIL CODE, Art.
collecting of assets previously demandable. (Idos v. 1846)
Court of Appeals, G.R. No. 110782) Prohibition against No prohibition against
engaging in business engaging in business
Q: Are partners allowed to engage in another (CIVIL CODE, Art. 1789,
business? Art. 1808)
A: Capitalist partner cannot engage in business of Retirement, death, Does not have same
the same kind with the partnership for his own insolvency, insanity effect; rights
account UNLESS there is stipulation to the contrary. dissolves partnership transferred to legal
(Civil Code, Art. 1808) (CIVIL CODE, Art. representative (CIVIL
1830) CODE, Art. 1861)
Industrial Partner cannot engage in business,
whether or not of the same of line of business with Q: In what order are the liabilities of the limited
the partnership UNLESS partnership expressly partnership to be paid after dissolution?
permits him to do so. (Civil Code, Art. 1789)
Priority in Distribution of Assets
Q: Can a partner be exempted from bearing a. Those due to creditors, including limited partners
losses of the partnership? b. Those due to limited partners in respect of their
A: YES. If a person can make a gift to another, there share in profits/compensation
is no sound reason why a person cannot also agree c. Those due to limited partners of return of capital
to bear all the losses. BUT, in so far as third persons contributed
are concerned, such stipulation may be declared d. Those due to general partner other than capital
void. (De Leon, pp. 124-125, citing Espiritu and and profits
Sibal) e. Those due to general partner in respect to profits
f. Those due to general partner for return of capital
D. LIMITED PARTNERSHIP contributed (CIVIL CODE, Art. 1863)

Q: Compare General vs. Limited Partnership.

GENERAL LIMITED -- end of topic --
Personally liable for Liability extends only
partnership to his capital VIII. AGENCY
obligations (CIVIL contributions (CIVIL
CODE, Art. 1816) CODE, Art. 1843)
A. DEFINITION OF AGENCY

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Q: What is the contract of agency?
A: By the Contract of Agency, a person binds
himself to render some service or to do something
in representation or on behalf of another, with the
consent or authority of the latter.
(CIVIL CODE, ART. 1868)
B. NATURE, FORMS, AND KINDS OF
AGENCY
Q: What is the form required of an agency?
A: Article 1869. Agency may be express, or implied
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. Agency may be oral, unless the
law requires a specific form. (1710a)
Q: The Bank of the Philippine Islands sent
Spouses Rainier Jose M. Yulo and Juliet L. Yulo
a credit card packet which contained petitioner's
pre-approved credit card and a copy of its Terms
and Conditions. This was received through
Ranier Yulo’s authorized representative, one
Jessica Baitan, as shown in the check mark in
the box beside "Authorized Representative" in
the Delivery Receipt. The Yulo Spouses
regularly settled their accounts with the Bank of
the Philippine Islands at first, but started to be
delinquent with their payments by July 2008.
Their outstanding balance ballooned to a large
sum which included finance charges, penalties,
and interests. Unable to collect, BPI sued.
While it is clear that the Yulos are liable for the
principal amount, are the Yulos also liable for
the finance charges, penalties, and interests
which is provided for in the terms and
conditions of the credit card packet that they
received?
A: As a pre-screened client, petitioner Rainier did
not submit or sign any application form as a
condition for the issuance of a credit card in his
account. Unlike a credit card issued through an
application form, with the applicant explicitly
consenting to the Terms and Conditions on credit
accommodation use, a pre-screened credit card
holder's consent is not immediately apparent. Thus,
respondent, as the credit card provider, had the
burden of proving its allegation that petitioner
Rainier consented to the Terms and Conditions
surrounding the use of the credit card issued to him.
While the Delivery Receipt showed that Baitan
received the credit card packet for petitioner Rainier,
it failed to indicate Baitan's relationship with him.
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CIVIL LAW (AND PRACTICAL EXERCISES)
Respondent also failed to substantiate its claim that
petitioner Rainier authorized Baitan to act on his
behalf and receive his pre-approved credit card. The
only evidence presented was the check mark in the
box beside "Authorized Representative" in the
Delivery Receipt. This self-serving evidence is
obviously insufficient to sustain respondent's claim.
A contract of agency is created when a person acts
for or on behalf of a principal, with the latter's
consent or authority. Unless required by law, an
agency does not require a particular form, and may
be express or implied from the acts or silence of the
principal. Respondent fell short in establishing an
agency relationship between petitioner Rainier and
Baitan, as the evidence presented did not support
its claim that petitioner Rainier authorized Baitan to
act on his behalf.
Without proof that petitioner Rainier read and
agreed to the Terms and Conditions of his pre-
approved credit card, petitioners cannot be bound
by it. Court orders only payment of principal amount
plus legal interest which is 12% legal interest from
November 11, 2008, the date of BPI's first
extrajudicial demand, until June 30, 2013, and six
percent (6%) legal interest from July 1, 2013 until
fully paid. (Yulo v. BPI, G.R. No. 217044. January
16, 2019)
SALES vs. AGENCY
Q: On April 25, 2002, Atty. Pineda, heavily in
debt, engaged Danilo S. Ibanez to sell his 3
hectares orchard for a price of Six Million Pesos,
payable in 24 months. The MOA signed by the
parties provided that P750,000 will be used to
pay off Atty. Pineda’s loan and the balance to be
paid in 19 months. The MOA also provided that
a special power of attorney will be issued to
Ibanez: to subdivide, sell, execute, sign all
papers, deeds and affidavits that may be
required in connection with the sale of lots, to
receive payments either in cash or checks, with
authority to encash with payee bank.
On the same date, Atty. Pineda executed a
Special Power of Attorney (SPA) authorizing the
Ibanez:
1. To enter into any contract, subdivide
and sell my parcel of land situated in
Baliok, Toril, Davao City, covered by
TCT T-276925 with an area of 30,000
square meters to any person either
natural or juridical.
2. To execute, sign all papers, deeds and
affidavits that may be required in
connection with the sale of said land.
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3. To receive the payment either in cash or
check with authority to encash with
payee bank.
Ibañez, with authority from the SPA and MOA,
sold parts of the property to several buyers and
collected payments which he did not remit to
Atty. Pineda. Angered, the latter sent letters to
the vendees informing the vendees that
payment should be made to Atty. Pineda being
the landowner. The parties then executed an
"Amicable Settlement" wherein they agreed that
Atty. Pineda will receive 60% of the total
collection on a weekly basis until the P6 million
due is fully paid. However, Ibañez did not remit
payment and an estafa case was filed.
Does the MOA and SPA simultaneously
executed give rise to a contract of agency such
that the failure of Ibañez to remit funds renders
Ibañez guilty of estafa?
A: NO! As written, the MOA stipulated that the
petitioner and Atty. Pineda had entered into a
contract of sale involving the property for the price
of P6,000,000.00 to be paid in 24 months as stated
therein. The literal meaning of the MOA should
control. Neither did the concurrent execution of the
special power of attorney (SPA) and the MOA
necessarily negate the contract of sale between the
parties.
The stipulation in the MOA on the SPA did not prove
that the parties' relationship was one of agency. To
begin with, the execution of the SPA was among the
terms specifically stipulated in the MOA. Instead of
proving an agency relationship, however, the
stipulation that Atty. Pineda as the vendor should
execute the SPA in favor of the petitioner evinced
the intention of the parties that title would not be
vested in the vendee until the full payment of the
purchase price. Such intention was consistent with
the sale, for the transfer of the title upon full payment
of the consideration made the sale conditional,
which did not change the nature of the transaction
as a sale. (Ibañez v. People of the Philippines, G.R.
No. 198932, October 9, 2019.)
Q: What acts must appear in a Special Power of
Attorney?
A: (PECWEM- LLB-BOCARO) (Civil Code, Art.
1878)
1. To make such Payments as are not usually
considered as acts of administration; 
 Corporation v. Keppel Cebu Shipyard, et.
2. To Effect novations which put an end to
obligations already in existence at the time
the agency was 
constituted; 
 C. OBLIGATIONS OF THE AGENT
3. To Compromise, to submit questions to
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CIVIL LAW (AND PRACTICAL EXERCISES)
arbitration, to renounce the right to appeal
from a judgment, 
to waive objections to
the venue of an action or to abandon a
prescription already acquired; 

4. To Waive any obligation gratuitously; 

5. To Enter into any contract by which the
ownership of an immovable is transmitted
or acquired either 
gratuitously or for a
valuable consideration; 

6. To Make gifts, except customary ones for
charity or those made to employees in the
business 
managed by the agent; 

7. To Loan or borrow money, unless the latter
act be urgent and indispensable for the
preservation of 
the things which are under
administration; 

8. To Lease any real property to another
person for more than one year; 

9. To Bind the principal to render some
service without compensation; 

10. To Bind the principal in a contract of
partnership; 

11. To Obligate the principal as a guarantor or
surety; 

12. To Create or convey real rights over
immovable property; 

13. To Accept or repudiate an inheritance; 

14. To Ratify or recognize obligations
contracted before the agency; 

15. Any Other act of strict dominion. 

The power of administration does not include acts of
disposition or encumbrance, which are acts of strict
ownership. Art. 1877 provides that an authority to
dispose cannot proceed from an authority to
administer, and vice versa. (Aggabao v. Parulan,
2010)
Q: What are the requisites of an Agency by
Estoppel?
A: The following are the requisites of an Agency by
Estoppel:

1. The principal manifested a representation
of the agent’s authority or knowingly
allowed the agent to assume such
authority;
2. The third person, in good faith, relied upon
such representation; and
3. Relying upon such representation, such
third person has changed his position to his
detriment. (Country Bankers Insurance
al., 2012)
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SCOPE OF AUTHORITY
Q: Gemma Trinidad-Gandionco together with
other members of the Trinidad family are co-
owners of two parcels of land in Pamplona, Las
Piñas. Gemma herself owns also two other
parcels in Pamplona also. Gemma's brother-in-
law, respondent Roberto opened a beer
dealership for Masbate City with SMC. One of
SMC's standard requirements for a dealership is
the submission of sufficient collateral, in money
or other valuable properties, to secure the beer
stocks to be taken out from SMC. Roberto asked
Gemma for help and Gemma first lent him the
title to one parcel of her land and when Roberto
approached her again three more times, she
eventually lent him several titles including the
ones she co-owned with the other Trinidads,
with the consent of the co-owners.
She also executed Special Powers of Attorney
(SPA’s) each time. (4x) When asked about the
titles, Roberto would explain that the titles were
still with SMC which has yet to decide which title
to accept as collateral. It was Gemma & the
Trinidads’ understanding that once SMC has
decided, Roberto would have them sign the
necessary documents.
When Gemma and Trinidad, et al., learned that
Roberto's business had closed down and that
Roberto surreptitiously mortgaged two of their
properties, they executed four revocations to
cancel all the SPAs.
Subsequently, Gemma and Trinidad, et al.,
learned that SMC has foreclosed on their
properties, which they now contest.
The SPA’s in question reads:
To offer as collateral, security or property bond
with [SMC] a parcel of land located at Las Piñas
City containing an area of ____ square meters
and all improvements thereon and covered by
TCT No. ____.
HEREBY GIVING AND GRANTING unto my/our
said Attorney-in-Fact full power and authority
whatsoever requisite necessary to be done in
and about the premises as fully to all intents and
purposes as I/WE might or could lawfully do if
personally present and acting; and
HEREBY RATIFYING AND CONFIRMING all that
my/our Attorney-in-Fact shall lawfully do or
cause to be done under and by virtue of these
presents.
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CIVIL LAW (AND PRACTICAL EXERCISES)
Was Roberto legally authorized to mortgage the
properties of Gemma and Trinidad et al to
secure Roberto's obligations with SMC?
A: Third persons not parties to the principal
obligation may secure such obligation by
mortgaging their own property. But Article 1878 of
the Civil Code requires an SPA in cases where real
rights over immovable property are created or
conveyed. Here, the SPAs specifically authorized
Roberto to "offer as collateral" to SMC the subject
properties. It is of no moment that it was the
supposed "understanding" of the registered owners
that "should SMC accept their certificates of title as
collateral, Roberto would bring the necessary
documents from SMC which [the registered owners]
would then sign."
Article 1900 of the Civil Code expressly states that
"[s]o far as third persons are concerned, an act is
deemed to have been performed within the scope of
the agent's authority, if such act is within the terms
of the power of attorney, as written, even if the agent
has in fact exceeded the limits of his authority
according to an understanding between the
principal and the agent."
Article 1902 likewise unequivocally states that
"[p]rivate or secret orders and instructions of the
principal do not prejudice third persons who have
relied upon the power of attorney or instructions
shown to them."
Gemma and Trinidad, et al., are still bound by the
mortgages entered by Roberto under the doctrine of
apparent authority. In this case, in addition to
executing similarly worded SPAs expressly
authorizing Roberto to offer specific properties as
collateral and to do all things necessary in
furtherance of said purpose, Gemma and Trinidad,
et al., delivered their original owner's duplicate TCTs
to Roberto. This happened not only once, but even
on four separate occasions
Furthermore, Gemma and Trinidad, et al. did not
exercise even the slightest diligence to ascertain the
whereabouts of their owner's duplicate TCTs, but
instead relied on Roberto's explanation that the titles
were still in SMC's possession which has yet to
decide which title to accept. They only revoked the
SPAs executed in favor of Roberto upon receiving
news that Roberto's business had closed down, and
that Roberto was able to mortgage two of their
properties.
Again, assuming that Roberto exceeded his
authority under the SPAs, Gemma and Trinidad, et
al., must be bound by the mortgages executed by
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the former, for "as between two innocent persons,
one of whom must suffer the consequences of a
breach of trust, the one who made it possible by his
act of confidence must bear the loss." (San Miguel
Corporation v. Trinidad G.R. No. 237506. July 28,
2020.)
AGENT’S ENTITLEMENT TO COMMISSION
Q: TKC Heavy Industries Corporation (TKC) is
engaged in the sale and distribution of trucks,
heavy equipment, and machinery. Tio is TKC's
president. Atienza is one of TKC's sales agents.
Atienza’s working relationship with TKC started
to deteriorate when Tio and the TKC staff
stopped answering his calls. Despite the lack of
contact with the company, Atienza continued
working on his pending deals with LGUs in
Caloocan, Quezon City, and Surigao del Sur.
Later, Atienza learned that Tio had been sending
other sales agents to attend to the former's
pending transactions. Atienza then demanded
payment of his salaries, commissions and
allowances, which were ignored, and thus, he
filed a labor case.
On the commissions, TKC argued that Atienza
was not entitled to it because Surigao del Sur is
not part of his sales area and the Quezon City
deal has not yet been consummated. TKC also
argues that Atienza is only entitled to half of the
commission on the Caloocan deal because he
only contributed fifty percent of the total sales
and collection effort for said project. On Surigao
del Sur, the records show that Atienza and
another agent, Quijada, worked together on
certain deals there, with the knowledge and
consent of TKC.
This is a labor proceeding where the Supreme
Court found that Atienza has resigned from the
company by the third week of February 2013
although he continued working on TKC’s deals
thereafter. His salaries and allowances were
recognized by the Supreme Court up to that
date. But the record of the case contains neither
any employment agreement between Atienza
and TKC which regulates the grant of
commissions, nor any internal TKC document or
practice pertaining to a commission policy.
How do we determine if Atienza is entitled to his
commissions?
A: In the absence of such internal regulations; and
in view of Atienza's functions as a TKC employee,
we apply the law on agency to determine the
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CIVIL LAW (AND PRACTICAL EXERCISES)
parameters for adjudicating Atienza's claim for
commissions. It is clear from the record that TKC
sales agents, Atienza included, conduct sales
activities, promote TKC's products to prospective
clients, communicate prospective and closed sales
to the head office, and assist LGUs with the
processing of government procurement documents
in connection with such sales.
Undoubtedly, there exists a principal-agent
relationship between TKC and its sales agents.
Sales agents, by the very nature of their functions,
are both employees and agents of their employers.
A traveling salesman," said the court in
Pennsylvania, "who exhibits samples of, and takes
orders from purchasers for, his employer's goods is
not, in a technical or popular sense, a broker, or
factor, although he may be compensated for
services by commissions on the sales so effected by
him." Clearly, Atienza fits this definition of a traveling
salesman; as such, the law on agency governs his
right to commissions, in the absence of contractual
stipulations on record.
Q: Applying the laws of agency how do we
determined if commissions are due?
A: Well settled is the rule that an agent is not entitled
to commissions for unsuccessful or
unconsummated transactions.
As a general rule, an agent is entitled to a
commission only upon the successful conclusion of
a sale. However, in certain cases where the factual
circumstances are contested, the determination of
an agent's right to commissions depends on a
number of considerations, such as:
1) the extent of completion of the undertaking,
which may be full, partial, or non-existent;
2) the value of the agent's efforts to the
principal;
3) the termination of the agency before full
completion of the undertaking; and
4) the nature and circumstances of such
termination.
As a general proposition, it must be true that the
agent is entitled to his compensation when and only
when he has fully completed his undertaking
according to its terms. In many cases, there is no
difficulty in determining when this time arrives, but in
others it is not easy to decide upon the full measure
of the agent's undertaking or upon the fact of its
performance. Each case rests upon its own peculiar
facts and circumstances, and the inquiry in every
instance must be:
1. What did the agent undertake to do?
2. Has he done it, and if not, then,
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3. To whose act or to what occurrence is the
failure to be attributed?
With respect the Quezon City project, he can no
longer claim commissions for it, because that deal
remained pending long after his severance from
TKC. As regards the Caloocan deal, records show
that TKC made deliveries a mere one week after
Atienza ceased becoming an agent of the company.
Under our law on agency, agents may still be
entitled to commissions for transactions
consummated within a reasonable time after the
expiration or termination of their authority if it can be
shown that the agent's efforts were "somehow
instrumental" to the consummation thereof.
In view of the evidence on record, We find it most
just and appropriate to award P100,000.00 in equity
to Atienza for his efforts in securing the Caloocan
transaction, in line with the foregoing "equitable
commission doctrine" enunciated by this Court in
Prats v. Court of Appeals and Manotok Brothers,
Inc. v. Court of Appeals.
While we sustain respondents' contention that
Atienza was not the efficient procuring cause of the
transaction, his efforts in securing the
documentation and approvals necessary for the
consummation thereof entitle him to an equitable
remuneration therefor.
As regards the Surigao del Sur deal commissions,
the records disclose that Atienza and Quijada
worked together on certain deals in Surigao del Sur.
Given the gaps in the evidence on TKC company
policy, on one hand; and the substantial evidence
showing that Atienza's participation in the Surigao
del Sur deal was authorized by his employer-
principal and by his co-agent, on the other hand, this
Court must again remedy the deficiency by applying
the law on agency. "One person may appoint a great
many agents not only as of course where their
duties relate to different subjects, but also frequently
where, though severally appointed and authorized,
their powers and duties may relate to the same
subject." The agency provisions of our Civil Code
recognize such a situation but limit the regulation
thereof to the responsibility of the co-agents as
against other parties.
Nevertheless, our Civil Code operates under the
presumption that obligations are joint in nature
unless solidarity is stipulated. This presumption
extends to co-agents under Article 1894 of the Civil
Code with respect to their responsibility.
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CIVIL LAW (AND PRACTICAL EXERCISES)
Conversely, such presumption of jointness must
likewise extend to the principal's obligation to
compensate the co-agents, unless otherwise
stipulated or proven. Here, the presumption of joint
agency is bolstered by the aforecited evidence
showing that Atienza and Quijada worked together
on the Surigao del Sur deals as co-agents.
Acting separately but in concert, Atienza and
Quijada represented TKC in the negotiations,
coordinated with the concerned LGU officials, and
handled the processing of the procurement
documents.
Since there is no indication from the record of any
agreement, stipulation, or policy governing the
sharing of commission among TKC's agents, the 3%
commission on the aforementioned deals must be
shared equally between Quijada and Atienza, still
following the principles of the law on agency.
(Atienza v. TKC Heavy Industries Corporation G.R.
No. 217782. June 23, 2021.)
D. OBLIGATIONS OF THE PRINCIPAL
Q: What is the rule on responsibility of two or
more agents serving the same principal?
A: Solidary when stipulated; joint when nothing is
stipulated (VILLANUEVA & TIANSAY-
VILLANUEVA, Agency & Trusts, Partnerships, &
Joint Ventures 181-182, 2015 [citing Civil Code, Art.
1894]).
Exception to the Exception: when one of the other
agent/s acts beyond the scope of his authority –
innocent agent is not liable. (Civil Code, Art. 1895)
TWO OR MORE AGENTS WITH ONE PRINCIPAL
v. TWO PRINCIPALS WITH A COMMON AGENT
Article 1894. The responsibility of two or more
agents, even though they have been appointed
simultaneously, is not solidary, if solidarity has not
been expressly stipulated. (1723)
Article 1915. If two or more persons have appointed
an agent for a common transaction or undertaking,
they shall be solidarily liable to the agent for all the
consequences of the agency. (1731)
Article 1895. If solidarity has been agreed upon,
each of the agents is responsible for the non-
fulfillment of agency, and for the fault or negligence
of his fellows agents, except in the latter case when
the fellow agents acted beyond the scope of their
authority. (n)
E. MODES OF EXTINGUISHMENT
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REVOCATION
Q: Petitioners, registered owners of two parcels
of agricultural land, granted respondent
(Madlangbayan) the authority to sell their
properties. The respondent received a counter-
offer from respondents Dalida et al which was
rejected by the petitioners. Another offer with a
former mayor was accepted by one of the
petitioners but the deal fell through because of
a conflict with the respondent over his
commission.
Because of this, the petitioners executed a
Revocation of the Special Power of Attorney,
rescinding respondent’s authority to sell their
properties on May 3, 1996. On June 5, 1996, the
petitioners sent a letter to respondent to
formally demand the return of their owner’s
duplicate certificate of title. Unheeded, the
petitioners filed an affidavit of adverse claim on
their title with the Registry of Deeds on July 1,
1996. Subsequently, they filed a complaint for
revocation of authority and annotated a lis
pendens on the title.
Respondent’s reply was that the authority can
no longer be revoked as the properties have
already been sold to respondents Dalida et al.
Among the evidence presented was a deed of
absolute sale to Dalida executed two days prior
to the letter rejecting their counter-offer.
However, the deed does not appear in the
notarial registry for that year.
Q: In light of the Revocation is the deed of
absolute sale to Dalida valid?
A: Without registration, a document or instrument
while signed by the Notary Public cannot be treated
as duly notarized. It cannot be treated as a public
document and as such, is not entitled to the
presumption of regularity. The document or
instrument does not have for its benefit that which is
due to public documents, that is that genuineness
and due execution need not be proved. Irregular
notarization reduces the evidentiary value of a
document to a private document which requires
proof of its due execution and authenticity to be
admissible as evidence.
The authority given to respondent Madlangbayan
was expressly revoked in an instrument dated May
3, 1996. This would have been sufficient to revoke
the agency, but as the owner's duplicate TCT
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CIVIL LAW (AND PRACTICAL EXERCISES)
remained with respondent Madlangbayan, the
petitioners filed an Affidavit of adverse claim on July
1, 1997. On July 14, 1997, the petitioners filed a
case for annulment of respondent Madlangbayan's
authority. Simultaneously, petitioners also filed a
notice of lis pendens which was annotated on the
TCT of the subject properties.
A contract of agency is extinguished by its
revocation. As agency is a personal contract of
representation that is based on the trust and
confidence reposed by the principal upon the agent,
it may be revoked by the principal. (De Joya v.
Madlangbayan, G.R. No. 228999. 28 April 2021.)
Q: When can a contract of agency be terminated
by the principal?
A: Generally at any time, except when an agency is
coupled with an interest, as in the following cases:
1. a bilateral contract depends upon it, or
2. if it is the means of fulfilling an obligation
already contracted, or
3. if a partner is appointed manager of a
partnership in the contract of partnership
and his removal from the management is
unjustifiable. (Civil Code, Art. 1927)
Q: What are the modes of extinguishing a
contract of agency? (EDWARD)
a) By the Expiration of the period for which the
agency was constituted.
b) By the Death, civil interdiction, insanity or
insolvency of the principal or of the agent;
c) By the Withdrawal of the agent;
d) By the Accomplishment of the object or
purpose of the agency;
e) By its Revocation;
f) By the Dissolution of the firm or corporation
which entrusted or accepted the agency (Civil
Code, Art. 1919)
Q: What happens to a contract of agency
following the principal’s death?
A: As a general rule, the principal’s death
extinguishes the contract of agency. The exceptions
are:
1. If the agency was constituted for the benefit
of both parties or a third person. (Art. 1930)
2. Contract entered into by the agent is
binding when the agent had no knowledge
that the principal has died, and the third
person acted in good faith. The contract will
bind the principal’s estate. (Civil Code, Art.
1931)
-- end of topic --
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IX. CREDIT TRANSACTIONS Same thing loaned Pay the same amount of
the same kind and
A. LOAN quality

As to risk of loss
1. IN GENERAL
Bailor since he is the Debtor/Bailee (even if
Q: What is a commodatum? (Art. 1933) owner the thing is lost through
A: The bailor delivers to the bailee a non- a fortuitous event)
consumable thing so that bailee may use the same
for a certain time and return the identical thing. As to time of return
There is no transfer of ownership. (2006, 2004,
BAR) Upon the lapse of the Upon the lapse of the
term agreed upon. term agreed upon.
Exception to the object: may be a consumable
thing if the purpose is merely exhibition. However, Bailor may Exception: Art. 1198
demand the return of when the debtor loses
Q: What is a Mutuum or Simple Loan? (Art. 1953) the thing loaned every right to make use
A: lender delivers to the borrower money or other before the expiration of the period
consumable thing upon the condition that the latter of the term in case of
will pay the same amount of the same kind and urgent need (Art.
quality. There is transfer of ownership. 1946), or when the
contract is precarium,
in which case, the
COMMODATUM MUTUUM
bailor may demand
As to object the return of the thing
at will. (Art. 1947)
Ordinarily involves The subject matter is
something not money or other 2. COMMODATUM
consumable except consumable thing.
when the purpose of
Q: What are the kinds of commodatum?
consumable goods is
(a) Ordinary commodatum – bailee uses the
merely for exhibition.
thing for a certain period of time
(Art. 1936)
(b) Precarium – bailor may demand the thing
As to cause loaned at will; exists in cases where:
i. There is no stipulation as to the
Essentially gratuitous. May be gratuitous or duration of the contract or use of the
(Art. 1933) Otherwise, onerous (with a thing loaned
it ceases to be stipulation to pay ii. Use of the thing is merely tolerated by
commodatum. interest). the owner(Art. 1947).

As to purpose Q: What are the principal obligations of a bailee

in a commodatum?
Use or temporary Consumption 1. Take good care of the thing with the
possession. diligence of a good father of a family. (Art.
1163)
As to subject matter 2. Use the thing loaned only for the purpose
for which it was loaned and for no other
Real or personal Personal property purpose. (Art. 1935)
property 3. Payment of the ordinary expenses for the
use and preservation of the thing loaned.
As to ownership of the thing (Art. 1941)
4. Payment of a 50% portion of extraordinary
Retained by the bailor Passes to the debtor expenses arising from the actual use of the
thing, which shall be borne by both the
bailor and the bailee, even though the
As to return of the thing bailee acted without fault, unless there is a

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stipulation to the contrary. (Art. 1949, par.
2)
5. Return and to not retain the thing loaned
except for damages mentioned in Art.
1951.
Q: What is the Right of Retention? (Art. 1951)
(05, BAR)
A: General Rule: Bailee has no right of retention on
the ground that the bailor owes him something.
Exception: Art. 1951 on hidden defects (Bailor who
knows flaws but does not advise bailee is liable to
bailee for damages suffered because of flaws).
Q: What are the obligations of a bailor in
commodatum?
1. Respect the duration of the loan. Bailor
cannot demand return until after: (a)
expiration of period stipulated; or (b)
accomplishment of use for which
commodatum was constituted. (Art. 1946)
a. Exceptions:
i. If urgently need thing
(may demand
return/temporary use); or
ii. If the bailor may demand
immediate return of the
thing if the bailee commits
any acts of ingratitude.
(Art. 1948)
2. Refund to the bailee extraordinary
expenses incurred for the preservation of
the thing, provided the bailee brings the
same to the knowledge of the bailor before
incurring them, except when the reply to the
notification cannot be awaited without
danger. (Art. 1949, par. 1) However, if the
extraordinary expenses arise on the
occasion of the actual use by the bailee,
even though he acted without fault, they
shall be borne equally by both the bailor
and the bailee, unless there is a stipulation
to the contrary. (Art. 1949, par. 2)
3. Be liable for damages which the bailee may
suffer for failure of the bailor to advise the
former of flaws (hidden defects) of the thing
loaned which are known to him. (Art. 1951)
3. SIMPLE LOAN
Q: What are the obligations of a borrower in a
simple loan or mutuum?
1. Pay the creditor an equal amount of the
same kind and quality. (Art. 1953)
a. Period agreed upon.
b. If none is provided, payable
immediately
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CIVIL LAW (AND PRACTICAL EXERCISES)
c. If the parties intended a period but
the same was not specified, the
court may fix the period. (Art.
1197)
d. Payable immediately when the
debtor loses the right to make use
of the period under Article 1198.
2. Pay interest, if stipulated in writing. (Art.
1956)
4. INTERESTS ON LOAN
Q: What are the two types of interest?
1. Monetary or conventional interest –
refers to the compensation set by the
parties for the use or forbearance of money;
Payment of monetary interest is allowed
only if:
a. express stipulation for the
payment of interest; and
b. agreement for the payment of
interest was reduced in writing
2. Compensatory interest – interest that
may be imposed by law or by courts as
penalty for damages arising from delay in
paying a fixed sum of money or delay in
assessing and paying damages. (Articles
2209 to 2213; Hun Hyung Park v. Eung
Won Choi, G.R. No. 220826, March 27,
2019)
Q: When will interest due and unpaid earn
interest?
A: Generally, interest due and unpaid shall not earn
interest, except:
1. Interest due shall earn legal interest at the
rate of 6% per annum from the time it is
judicially demanded until fully paid,
although the obligation may be silent upon
this point. (Art. 2212)
2. If there is agreement to this effect. (Art.
1959)
Note: Interest on interest refers to interest due on
conventional interest. (Sps. Abella v. Sps. Abella,
G.R. No. 195165, July 08, 2015)
Q: When should interest be paid?
A: Generally, no interest shall be due unless it has
been expressly stipulated in writing. (Art. 1956)
Q: When is interest due even if not expressly
stipulated?
1. If the obligation consists in the payment of
a sum of money, and the debtor incurs in
delay, the indemnity for damages, there
being no stipulation to the contrary, shall be
the payment of the interest agreed upon,
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and in the absence of stipulation, the legal
interest, which is six per cent per annum
(Art. 2209); or
2. Interest due shall earn legal interest from
the time it is judicially demanded, although
the obligation may be silent upon this point.
(Art. 2212)
Q: What is the legal interest rate?
1. Beginning July 1, 2013, the rate of interest
on the loan or forbearance on money,
goods, or credits and the rate allowed in
judgments, in the absence of stipulation,
shall be 6% per annum (BSP Circular No.
799).
2. However, judgments that became final and
executory before July 1, 2013 shall
continue to apply the previous legal rate of
12% per annum (NACAR v. Gallery
Frames Inc., G.R. No. 189871, 2013).
NOTE: Bifurcation is applicable. The computation
of the amount due must take into consideration the
legal rate or rates (6% and/or 12% per annum)
applicable throughout the duration of the period in
which interest runs. (DPWH Secretary vs. Spouses
Tecson, G.R. No. 179334, 2015)
Q: What are the rules in the computation of legal
interest? (Lara’s Gifts & Decors v. Midtown
Industrial Sales, G.R. No. 225433, 2019)
1. When the obligation is breached, and it
consists in the payment of a sum of
money, i.e., a loan or forbearance of
money, goods, credits or judgments, the
interest due shall be that which is
stipulated by the parties in writing,
provided it is not excessive and
unconscionable, which, in the absence of a
stipulated reckoning date, shall be
computed from default, i.e., from
extrajudicial or judicial demand in
accordance with Article 1169 of the Civil
Code, UNTIL FULL PAYMENT, without
compounding any interest unless
compounded interest is expressly
stipulated by the parties, by law or
regulation.
a. Interest due on the principal
amount accruing as of judicial
demand shall SEPARATELY
earn legal interest at the
prevailing rate prescribed by the
Bangko Sentral ng Pilipinas,
from the time of judicial demand
UNTIL FULL PAYMENT.
2. In the absence of stipulated interest, in a
loan or forbearance of money, goods,
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CIVIL LAW (AND PRACTICAL EXERCISES)
credits or judgments, the rate of interest
on the principal amount shall be the
prevailing legal interest prescribed by
the Bangko Sentral ng Pilipinas, which
shall be computed from default, i.e., from
extrajudicial or judicial demand in
accordance with Article 1169 of the Civil
Code, UNTIL FULL PAYMENT, without
compounding any interest unless
compounded interest is expressly
stipulated by law or regulation.
a. Interest due on the principal
amount accruing as of judicial
demand shall SEPARATELY earn
legal interest at the prevailing
rate prescribed by the Bangko
Sentral ng Pilipinas, from the
time of judicial demand UNTIL
FULL PAYMENT.
3. When the obligation, not constituting a
loan or forbearance of money, goods,
credits or judgments, is breached, an
interest on the amount of damages
awarded may be imposed in the
discretion of the court at the prevailing
legal interest prescribed by the Bangko
Sentral ng Pilipinas, pursuant to Articles
2210 and 2011 of the Civil Code. No
interest, however, shall be adjudged on
unliquidated claims or damages until the
demand can be established with
reasonable certainty.
4. Accordingly, where the amount of the claim
or damages is established with
reasonable certainty, the prevailing legal
interest shall begin to run from the time
the claim is made extrajudicially or
judicially (Art. 1169, Civil Code) UNTIL
FULL PAYMENT, but when such certainty
cannot be so reasonably established at
the time the demand is made, the interest
shall begin to run only from the date of the
judgment of the trial court (at which time
the quantification of damages may be
deemed to have been reasonably
ascertained) UNTIL FULL PAYMENT.
5. The actual base for the computation of
the interest shall, in any case, be on the
principal amount finally adjudged,
without compounding any interest unless
compounded interest is expressly
stipulated by law or regulation.
Q: Must the manner of compounding the interest
also be in writing?
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A: In a loan agreement, compounding of interest
has to be in writing to be valid. (Albos v. Embisan,
G.R. No. 210831, 2014)
Q: Can the stipulated interest be modified?
A: Any modification of stipulated interest (e.g.,
allowing the creditor to unilaterally increase or
decrease the interest rate at any time) must be
mutually agreed upon, otherwise, it has no binding
effect. Further, a borrower may not be required to
prepay the loan if he is not agreeable to the arbitrary
interest rates being imposed. (Spouses Silos v.
PNB, G.R. No. 181045, 2014)
Q: Is the interest payment of 5% per month
excessive?
A: YES. 5% per month or 60% per annum interest
rate is void for being unconscionable. (Bulatao v.
Estonactoc, G.R. No. 235020, 2019)
Q: What is the consequence of having usurious
interest?
A: In usurious loans, the entire obligation does not
become void because of an agreement for usurious
interest; the unpaid principal debt still stands and
remains valid but the stipulation as to the
usurious interest is void. Consequently, the debt
is to be considered without stipulation as to the
interest. (First Metro Investment Corp. v. Este Del
Sol Mountain Reserve, Inc., G.R. No. 141811, 2001)
Q: What is the distinction between escalation
clauses and floating rate of interest clauses?
(Security Bank Corp. v. Spouses Mercado, 2018)
Escalation Clauses Floating Rate of
Interest
These are stipulations It refers to the variable
which allow for the interest rate stated on
increase (as well as the a market-based
mandatory decrease) of reference rate agreed
the original fixed upon by the parties.
interest rate.
This pertains to the
It is the method by interest rate itself that
which fixed rates may is not fixed.
be increased
Q: Petitioner X was granted a loan by Bank A
secured by a real estate mortgage. The interest
rate agreed upon by the parties was 17% per
annum. When X failed to pay some
amortizations, Bank A unilaterally escalated the
interest rate from 17% to 24% without the
knowledge of X or even an explanation as to why
the interest rates were increased. X filed a
complaint against Bank A. Bank A defended the
escalation, saying it was based on a stipulation
in the loan agreement that the interest rate
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CIVIL LAW (AND PRACTICAL EXERCISES)
would be subjected to escalations. Was the
escalation of interest rate made by Bank A
valid?
A: No. Even though there was a stipulation in the
loan agreement that the in the loan agreement that
the interest rate would be subjected to escalations,
Bank A failed to explain how it arrived to such
interest rates. While escalation clauses are not
wrong, they must not be solely potestative and
should be based on reasonable grounds. Further,
the interest rate imposed upon Petitioner X is
violative of the principle of mutuality of contracts.
Art. 1308 of the Civil Code provides that a contract
must bind both parties; its validity or compliance
cannot be left to the will of one of them. (Vasquez v.
PNB, G.R. Nos. 228355 & 228397, August 28,
2019)
Q: What is the effect of failing to pay a debt with
usurious/ unconscionable interest on the
validity of a foreclosure?
A: If the foreclosure arises out of the failure to pay a
mortgage indebtedness that has been grossly
inflated by unconscionable interest, the foreclosure
sale cannot be given any effect. A foreclosure
must be conditioned on the debtor’s failure to pay
the correct amount of the unpaid obligation, which
cannot include unconscionable interest charges.
However, the terms of the mortgage remain
effective, and foreclosure proceedings may be
instituted after a demand to pay the correct amount
of indebtedness and the debtor’s failure to pay such.
(Heirs of Espiritu v. Sps. Landrito, G.R. No. 169617,
April 4, 2007)
B. DEPOSIT
Q: What is a deposit?
A: Deposit is constituted from the moment a person
receives a thing belonging to another, with the
obligation of safely keeping it and of returning the
same (Art. 1962).
NOTE: Safekeeping must be the principal purpose
of the contract. Otherwise, it is not a deposit.
Q: What are the kinds of Deposit?
1. Judicial - when an attachment or seizure of
property in litigation is ordered by the court (Art.
2005)
2. Extrajudicial (Art. 1967)
a. Voluntary - delivery is made by the will of
the depositor or by two or more persons
each of whom believes himself entitled to
the thing deposited
b. Necessary - made in compliance with a
legal obligation, or on the occasion of any
calamity, or by travelers in hotels and inns
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or by travelers with common carriers. There deposit (Art.

is lack of free choice in the depositor. 1994)

Q: Is a deposit gratuitous? In whose Person who Depositor or

behalf it is has a right 3rd person
A: General Rule: A deposit is generally gratuitous
held designated
(Art. 1965).

Exceptions: [JESS] Q: What are the rules when either the depositor
1. When there is a contrary Stipulation or despositary is incapacitated?
2. Where depositary is Engaged in the business of DEPOSITARY DEPOSITARY
storing goods CAPACITATED, INCAPACITATED,
3. Where property is Saved from destruction DEPOSITOR DEPOSITOR
without knowledge of the owner INCAPACITATED CAPACITATED
4. Judicial deposit Depositary is subject to Depositary does not
ALL the obligations of a incur the obligations of
Q: What is the difference between a judicial depositary a depositary
deposit and an extrajudicial deposit? Depositary must return Depositary, however,
JUDICIAL EXTRA- the property either to: is liable to:
JUDICIAL a) The legal a) Return the
Creation Will of the Will of the representative thing
court contracting of the deposited
parties incapacitated; while still in
Purpose Security or to Custody and OR his
ensure the safekeeping b) The depositor possession;
right of a party himself if he AND
to the property should acquire b) Pay the
or to recover capacity depositor the
in case of amount by
favorable which he may
judgment have
benefited
Subject Movable or Movables only
himself with
Matter immovable
the thing or its
property, but
price (subject
generally
to the right of
immovable
any 3rd person
Cause Always May be
who acquires
onerous compensated
the thing in
but generally
good faith)
gratuitous
Return of Upon order of Gratuitous: Q: When is a deposit converted into a mutuum?
thing the court / end demand of A: If the thing deposited is money or other
of litigation depositor (Art. consumable thing, the permission to use it will result
1988) or return in its consumption and converts the contract into a
by depositary simple loan or mutuum. However, if safekeeping is
for justifiable still the principal purpose of the contract, it is still a
reasons (Art. deposit but an irregular one; hence, an Irregular
1989) Deposit. Example: Bank deposit (De Leon)
Compensated:
The Q: What is the difference between an irregular
depositary deposit and a mutuum?
may retain the
thing in pledge BASIS IRREGULAR MUTUUM
until full DEPOSIT
payment of Demandability Demandable Lender is
what may be at will of the bound by the
due him by irregular provisions of
reason of depositor for the contract

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whose benefit and cannot 15. Proper return: person, time, place
the deposit seek 16. No liability in case of loss by force majeure
has been restitution or government order
constituted until the time 17. Liability in case of alienation of depositary’s
of payment as heir
provided in
the contract Q: When is a Depositary is liable for loss of the
has arisen thing deposited?
(except under a) He transfers the deposit with a third person
Art. 1198) without being authorized to do so although
Benefit Benefit If with there is no negligence on his part and the
accrues to the interest, third person;
depositor benefit of both b) He deposits the thing with a third person
parties who is manifestly careless or unfit although
authorized, even in the absence of
Q: What are the two primary obligations of negligence; or
depositary? (Art. 1972) c) The thing is lost through the negligence of
1. Safekeeping of the object his employees whether the latter are
a. ordinary diligence, unless more is manifestly careless or not.
required by the circumstances d) Liability for loss without fortuitous event:
2. Return of the thing Depositary presumed at fault since he is in
possession (Art. 1265)
Q: What are the Obligations of the Depositary?
1. Safekeep the thing deposited Q: What is the nature of a contract of rent of
2. Return the thing on the date stipulated or safety deposit boxes? (Art. 1975)
when depositor claims it A: A contract for the rent of safety deposit boxes is
3. Not to transfer deposit, unless expressly not an ordinary contract of lease of things, but a
authorized special kind of deposit; hence, it is not to be strictly
4. Not to change the way of deposit, unless governed by the provisions on deposit. The
the circumstances indicate that the relationship between the bank and customer is one
depositor would consent to the change of bailor and bailee.
5. To collect capital and interest on the choses
in action deposited Q: What is the relationship between bank and
6. Not to commingle things if so stipulated depositor? (Art. 1980)
7. Not to make use of the things so deposited, A: Fixed, savings, and current deposits of money in
unless expressly authorized or necessary banks and similar institutions shall be governed by
for preservation the provisions concerning simple loan.
8. Not liable for loss through fortuitous event, a) Contract of loan – deposits in banks are
unless (USDA) really loans because the bank can use the
a. If it is so Stipulated same for its ordinary transactions
b. If he Uses the thing without the b) Relation of creditor and debtor – the
depositor’s permission relation between a depositor and a bank is
c. If he Delays in its return that of a creditor and a debtor.
d. If he Allows others to use it, even
though he himself may have been An instrument acknowledging receipt of a sum of
authorized to use the same money as a deposit returnable two months after
9. Obligation when the thing is closed and notice with interest is evidence of a contract of loan
sealed (return, damages, keep secret) and not of deposit. (Gavieres v. Pardo de Tavera,
10. To return products, accessories and G.R. No. 6, [November 14, 1901], 1 PHIL 71-73)
accessions
11. To pay interest on sums converted to Q: What can the depositary do to be relieved
personal use from liability when a third person appears to be
12. Cannot require that the depositor prove his the owner? (Art. 1984)
ownership over the thing a) He advised the true owner of the thing of
13. Obligation when third person appears to be the deposit
the owner b) If the owner, in spite of such information,
14. Obligation when there are two or more does not claim it within the period of one
depositors

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month (30 days), and the depositary
returns the thing deposited to the depositor.
Q; What are the obligations of the depositary
when there are two or more depositors? (Art.
1985)
1. Divisible thing and joint depositors – each
one of the depositors can demand only his
share proportionate thereto
a. General rule: Each one of the
depositors may do whatever may
be useful to the others (Art. 1212)
b. Exception: Anything which may
be prejudicial to the other
depositors
2. Indivisible thing or solidary depositors –
rules on active solidarity
a. General rule: The depositary may
return the thing to any one of the
solidary depositors
b. Exception: When a demand,
judicial or extrajudicial, for its
return has been made by one of
them in which case delivery should
be made to him
3. Return to one of the depositors stipulated
a. If by stipulation, the thing should
be returned to one of the
depositors, the depositary is
bound to return it only to the
person designated, although he
has not made any demand for its
return
Q: When does the depositary have the right to
return the thing deposited? (Art. 1989)
A: General rule: The depositary may return the
thing deposited, notwithstanding that a period has
been fixed for the deposit, if:
a) The deposit is gratuitous
b) The reason is justifiable
 Remedy if depositor refuses to receive the
thing: The depositary may deposit the thing
at the disposal of the judicial authority.
Exception: When the deposit is for a valuable
consideration, the depositary has no right to return
the thing before the expiration of the time
designated even if he should suffer inconvenience
as a consequence.
Q: What is the Right of Retention?
A: Depositary may retain the thing in his possession
until the full payment of what may be due him by
reason of the deposit (Art. 1994). The thing retained
serves as security for the payment of what may be
due to the depositary by reason of the deposit (see
Arts. 1965, 1992 & 1993).
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CIVIL LAW (AND PRACTICAL EXERCISES)
Q: When is a deposit extinguished?
1. Upon the loss or deterioration of the thing
deposited;
2. Upon the death of the depositary, only in
gratuitous deposits;
3. Other provisions in the Civil Code
(novation, merger, etc.)
Q: When does a necessary deposit arise?
Extrajudicial Deposit: (PLCT)
1. It is made in compliance with a Legal
obligation
2. It takes place on the occasion of any
Calamity, such as fire, storm, flood, pillage,
shipwreck, or other similar events
a. There must be a causal relation
between the calamity and the
constitution of the deposit.
3. Made by Passengers with common carriers
a. As to baggage the passengers or
their agents carry
4. Made by Travelers in hotels or inns (Art.
1998)
a. Before keepers of hotels or inns
may be held responsible as
depositaries with regard to the
effects of their guests, the
following must concur:
Q: What are the elements of a necessary deposit
in favor of travelers or passengers?
a. They have been previously informed about the
effects brought by the guests; and
 Is actual notification required before the
common carrier becomes liable for lost
belongings that remained in the custody of
the passenger? NO. (Sulpicio Lines v.
Sesante, 2016)
b. The guests have taken the precautions
prescribed regarding their safekeeping.
Q: What is the scope of liability of keepers of
hotels and inns?
A: Inside the hotel and its annexes (such as hotel
parking)
When the traveler avails of the valet service of
hotels. The contract of deposit is perfected from the
traveler’s delivery of the keys to the vehicle to the
hotel, who has the obligation to safely keep and
return it to the owner. Loss of the vehicle on the
hotel’s premises or annexes may give rise to a claim
of damages (Durban Apartments v. Pioneer
Insurance, G.R. No. 179419, 2011).
Q: When is a hotelkeeper liable? (Arts. 2000 –
2002)
A: The hotel-keeper is liable regardless of the
amount of care exercised when:
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a) The loss or injury to personal property is

caused by his servants or employees as Temporary use of
Consumption Safekeeping
well as by strangers (Art. 2000) the thing
b) The loss is caused by the act of a thief or
robber done without the use of arms or OBLIGATION
irresistible force (Id., Art. 2001)
Take care of the
Take care of the thing
Q: When is a hotelkeeper not liable? thing with due
a) The loss or injury is caused by force Return a thing
diligence Do not use the
majeure, like flood, fire, theft or robbery by of the same
thing deposited
a stranger (not the hotel-keeper’s servant kind and
Return the thing unless
or employee) with the use of firearms or quality
upon expiration of authorized or is
irresistible force period or purpose required for its
a. Exception: Unless the hotel- preservation
keeper is guilty of fault or STATUS OF OWNERSHIP
negligence in failing to provide
against the loss or injury from his Passes to Retained by the
cause Retained by bailor
bailee depositor
b) The loss is due to the acts of the guests, his
family, servants, visitors ABILITY TO DEMAND RETURN
c) The loss arises from the character of the Anytime, if no
things brought into the hotel period or purpose Only after the
has been agreed expiration of
Q: When is there an exemption or diminution of upon or if by mere the period
hotelkeeper’s liability? Anytime
tolerance only Exception:
A: The hotelkeeper cannot free himself from Exception: for
(precarium) when the
compensation
responsibility by posting notices to the effect that he debtor loses
(depositary has
is not liable for the articles brought by the guest (Art. If there is an every right to
right of retention)
2003) urgent necessity make use of
the period (Art.
Q: When does the Hotel-keeper have a right to Acts of ingratitude 1198)
retention? by the bailee
A: The hotel-keeper has a right to retain the things
in pledge brought into the hotel by the guest, as a C. GUARANTY AND SURETYSHIP
security for credits on account of:
a) Lodging Q: What is the difference between a guaranty
b) Supplies usually furnished to hotel guests and suretyship?
GUARANTY (Art. SURETYSHIP
Q: What is the hotel-keeper’s right to sell? 2047)
A: A thing under a pledge by operation of law may Liability depends upon Assumes liability as a
be sold only after demand of the amount for which an independent regular party to the
the thing is retained (Art. 2122) agreement to pay the undertaking
obligation if the
COMMODATUM MUTUUM DEPOSIT principal debtor fails
to do so
OBJECT
Engagement is a Charged as an original
Non-consumable collateral undertaking promisor
(movable or Secondarily liable – Primarily liable –
immovable) he contracts to pay if, undertakes directly for
Fungible / Movable /
consumable personal by the use of due the payment without
Except:
(e.g., money) property diligence, the debt reference to the
consumable if
cannot be paid solvency of the
used for exhibition
purposes only
principal, and is so
responsible at once the
PURPOSE latter makes default,
without any demand by
the creditor upon the

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principal whatsoever or 2. It is prospective in its operation and is generally

any notice of default intended to provide security with respect to
Only binds himself to Undertakes to pay if future transactions.
pay if the principal the principal does not 3. Future debts, even if the amount is not yet
cannot or is unable to pay, without regard to known, may be guaranteed but there can be no
pay his ability to do so claim against the guarantor until the amount of
Insurer of the Insurer of the debt the debt is ascertained or fixed and
solvency of the debtor demandable.
Does not contract that Pay the creditor
the principal will pay, without qualification Q: Can a guarantor’s liability exceed the
but simply that he is if the principal debtor principal obligation? (Art. 2054)
able to do so does not pay. Hence, A: General rule: The guarantor cannot bind himself
the responsibility or for more than the principal debtor, both as regards
obligation assumed by the amount and the onerous nature of contract
the surety is greater or  If he does, his liability shall be reduced to the
more onerous than that limits of that of the debtor.
of a guarantor  But the guarantor may bind himself for less
Guarantor can avail of Surety cannot avail the than that of the principal.
the benefit of benefit of excussion Exceptions:
excussion and division and division. 1. Interest, judicial costs, and attorney’s fees
in case the creditor as part of damages may be recovered –
proceeds against him. creditors may recover from the surety as part of
Not bound to take Held to know every their damages the abovementioned fees even
notice of the non- default of the principal. without stipulation and even if the surety would
performance of the thereby become liable to pay more than the total
principle amount stipulated in the bond.
Reason: Surety is made to pay, not by reason
Q: What is the effect of a guaranty undertaken of the contract, but by reason of his failure to
without knowledge of debtor? (Art. 2050) pay when demanded and for having
compelled the creditor to resort to the
A: Rights of third persons who pay: courts to obtain payment.
1. Payment without the knowledge or against Interest runs from (demand):
the will of the debtor: a. Filing of the complaint (upon judicial
a. Guarantor can recover only insofar as the demand); or
payment has been beneficial to the debtor b. The time demand was made upon the
(Art. 1236) surety until the principal obligation is fully
b. Guarantor cannot compel the creditor to paid (upon extra-judicial demand)
subrogate him in his rights (Art. 1237) 2. Penalty may be provided – surety may be held
2. Payment with knowledge or consent of the liable for the penalty provided for in a bond for
debtor: Subrogated to all the rights which the violation of the condition therein.
creditor had against the debtor (Art. 2067)
Q: What is the Remedy of surety?
Q: What is a Double or Sub-Guaranty? (Art. A: Foreclose the counter-bond put up by the
2051(2)) principal debtor (if there is any)

A: One constituted to guarantee the obligation of a
guarantor. It should not be confounded with
guaranty wherein several guarantors concur.
Q: What is guaranty of future debts? (Art. 2053)
A: Continuing Guaranty or Suretyship:
1. Not limited to a single transaction but which
contemplates a future course of dealings,
covering a series of transactions generally for
an indefinite time or until revoked.
Q: Corp A secured a Performance Bond from
Corp B wherein the latter would become the
surety of the former, guaranteeing the
performance of Corp A’s obligations in favor of
a contract with Corp C. However, Corp A showed
poor progress, which led to Corp C demanding
Corp B to liquidate the Performance Bond,
without specifying the exact amount claimed.
Subsequently, Corp C terminated the contract
with Corp A. When negotiations for amicable
settlement fell through, Corp B denied Corp C’s
claim. This prompted Corp C to file a complaint
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Corp A and Corp B. The CIAC dismissed the
Complaint because it was not within a
reasonable period and such delay had released
Corp B from its liability as per Article 2080 of the
Civil Code. This was reversed by the CA on the
ground that Corp A had long been in default of
its obligations even before the first demand of
Corp C, which meant that the liability of Corp B
as surety had already arisen. Was the CA correct
in saying that Corp B was liable?
A: Yes. A contract stands as the law between the
parties for as long as it is not contrary to law, morals,
good customs, public order, or public policy. The
Performance Bond provides that upon Corp C’s first
demand, Corp B as surety shall indemnify the
former notwithstanding any dispute with regard to
whether the principal has complied with his
obligation. The Performance Bond thus stands as a
contract of surety contemplated under Article 2047
of the Civil Code which defines a surety wherein a
person binds himself solidarily with the principal
debtor. As a result, the surety is considered in law
as being the same party as the debtor in relation to
whatever is adjudged touching upon the obligation
of the latter, and their liabilities are interwoven as to
be inseparable. While the contract of surety stands
secondary to the principal obligation, the surety's
liability is direct, primary and absolute, albeit limited
to the amount for which the contract of surety is
issued. The surety's liability attaches the moment a
demand for payment is made by the creditor.
Furthermore, Article 2080 does not apply in this
case because it is only applicable to the liability of a
guarantor. (The Mercantile Insurance Co., Inc., v.
DMCI-Laing Construction, Inc., G.R. No. 205007,
September 16, 2019.)
Q: What is the Right of Guarantor to Benefit Of
Excussion Or Exhaustion? (Art. 2058)
A: All legal remedies against the debtor to be first
exhausted – to warrant recourse against the
guarantor for payment, it may not be sufficient that
the debtor appears insolvent.
If a party in a contract waives his right to excussion,
the contract has ceases to be a guaranty and is now
a suretyship under Article 2047 of the Civil Code.
(Trade and Investment Development Corporation of
the Philippines v. Philippine Veterans Bank, G.R.
No. 233850, 2019)
NOTE: Art. 2058 is not applicable to a contract of
suretyship.
Q: What are the exceptions to the Benefit of
Excussion (Art. 2059) (JAWS-IS-FUN)
1. If the guarantor has expressly Waived it.
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CIVIL LAW (AND PRACTICAL EXERCISES)
2. If he has bound himself Solidarily with the
debtor – liability assumed that of a surety
3. In case of Insolvency of the debtor – guarantor
guarantees the solvency of the debtor
4. When he (debtor) has Absconded, or cannot be
sued within the Philippines
a. Exception: Debtor has left a manager
or representative
5. Useless formality: If it may be presumed that a
judicial action including execution on the
property of the principal debtor would not result
in the satisfaction of the obligation
6. If he does Not comply with Art. 2060: In order
that the guarantor may make use of the benefit
of excussion, he must:
a. Set it up against the creditor upon the
latter’s demand for payment from him;
b. Point out to the creditor:
i. Available property of the debtor within
the Philippine territory
ii. Sufficient to cover the amount of the
debt.
7. If he is a Judicial bondsman and sub-surety
(Art. 2084) – because he is solidarily liable.
8. Where he has given a pledge or mortgage as a
Special security.
Q: What is the Benefit of Division Among
Several Guarantors? (Art. 2065)
1. In whose favor applicable - should there
be several guarantors of only one debtor
and for the same debt, the obligation to
answer for the same is divided among all.
2. Cannot be availed of if there are:
a. Two or more debtors of one debt,
even if they be bound solidarily,
each with different guarantors; or
b. Two or more guarantors of the
same debtor but for different debts
c. If any of the circumstances
enumerated in Art. 2059 should
take place, as would the benefit of
exhaustion of the debtor’s
property.
3. Extent of liability of several guarantors –
joint obligation
a. General rule: The obligation to
answer for the debt is divided
among all of them. The
guarantors are not liable to the
creditor beyond the shares which
they are respectively bound to pay.
b. Exception: Solidarity has been
expressly stipulated.
4. In order that the guarantor may be entitled
to the benefit of division, it is not required
that he point out the property of his co-
guarantors.
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Q: What is the Right to Reimbursement?
A: The guarantor who pays for a debtor must be
indemnified by the latter. The guarantor cannot
demand reimbursement for indemnity when he has
not paid the obligation.
Q: What are the exceptions to Right to Indemnity
or Reimbursement?
1. Where the guaranty is constituted without
the knowledge or against the will of the
principal debtor, the guarantor can recover
only insofar as the payment had been
beneficial to the debtor
2. Payment by a third person is a donation
and the payment is in any case valid as to
the creditor who has accepted it (Art. 1238)
3. Waiver
Q: When does the guarantor have a right to
proceed against debtor before payment? (Art.
2071)
A: General rule: Guarantor has no cause of action
against the debtor until after the former has paid the
obligation.
Exceptions: Art. 2071 enumerates instances when
the guarantor may proceed against the debtor even
before the payment (ITS-PAID):
1. When he is Sued for the payment;
2. In case of Insolvency of the principal
debtor;
3. When the debtor has bound himself to
relieve him from the guaranty within a
specified period, and this Period has
expired;
4. When the debt has become Demandable,
by reason of the expiration of the period for
payment;
5. After the lapse of Ten (10) years, when the
principal obligation has no fixed period for
its maturity, unless it be of such nature that
it cannot be extinguished except within a
period longer than ten years;
6. If there are reasonable grounds to fear that
the principal debtor intends to Abscond;
7. If the principal debtor is in imminent danger
of becoming Insolvent.
Q: What are the remedies available to the
guarantor?
1. To obtain release from the guaranty; or
a. only be exercised against the
principal debtor and not against
the creditor
2. To demand security that shall protect him
from:
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CIVIL LAW (AND PRACTICAL EXERCISES)
a. Any proceedings by the creditor; and
b. Against the insolvency of the debtor.
NOTE: Guarantor’s remedies are alternative. He
has the right to choose the action to bring.
Q: When can a surety recovery against
indemnitor (i.e., principal debtor) even before
payment?
1. Indemnity agreement is for the benefit of
surety – not for the benefit of the creditor
2. Indemnity agreement may be against actual
loss as well as potential liability
a. Indemnity against loss – indemnitor will
not be liable until the person to be
indemnified makes payment or sustains
loss
b. Indemnity against liability – indemnitor’s
liability arises as soon as the liability of the
person to be indemnified has arisen without
regard to whether or not he has suffered
actual loss
c. Where the principal debtors are
simultaneously the same persons who
executed the indemnity agreement, the
position occupied by them is that of a
principal debtor and indemnitor at the
same, and their liability being joint and
several.
The liabilities of an insurer under the surety bond are
not extinguished when the modifications in the
principal contract do not substantially or materially
alter the principal's obligations. The surety is jointly
and severally liable with its principal when the latter
defaults from its obligations under the principal
contract. (People's Trans-East Asia Insurance
Corporation v. Doctors of New Millennium Holdings,
Inc., G.R. No. 172404, 2014)
Q: What are the rights of the guarantor against
the debtor? (SICS)
1. Indemnification
2. Benefit of Subrogation
3. Benefit of Compromise
4. Right to obtain or demand a Security under
(Art. 2071)
Q: When does a co-guarantor have Right to
Contribution?
1. One guarantor has paid the debt to the
creditor
2. Payment was made
a. In virtue of judicial demand (benefit
of division has ceased); or
b. Because principal debtor is
insolvent
3. Guarantor who paid is seeking
reimbursement from each of his co-
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guarantors the share which is
proportionately owing him.
Q: What is the effect of insolvency of any
guarantor?
A: The share of the insolvent guarantor shall be
borne by the others including the paying guarantor
in the same joint proportion.
Q: What is the liability of sub-guarantor in case
of insolvency of guarantor? (Art. 2075)
A: Sub-guarantor is liable to the co-guarantors in the
same manner as the guarantor whom he
guaranteed in case of the insolvency of the
guarantor for whom he bound himself as sub-
guarantor.
Q: What are the causes for the extinguishment
of a guaranty?
A: General rule: Guaranty being accessory, it is
extinguished when principal obligation is
extinguished, the causes of which are:
1. Payment or performance;
2. Loss of the thing due;
3. Condonation or remission of the debt;
4. Confusion or merger of the rights of the
creditor and debtor;
5. Compensation; and
6. Novation
a. Material alteration of principal
contract
7. Other causes:
a. Annulment;
b. Rescission;
c. Fulfillment of a resolutory
condition;
d. Prescription
Exception: The guaranty itself may be directly
extinguished although the principal obligation still
remains such as in the case of the release of the
guarantor made by the creditor.
Q: What is the effect when there is a release of a
guarantor without consent of others? (Art. 2078)
A: The release benefits all to the extent of the share
of the guarantor released.
Q: What is a Release by Extension of Term
Granted by Creditor to Debtor? (Art. 2079)
A: Release Without Consent of Guarantor/
Surety: Guarantor/ surety is discharged from his
undertaking.
NOTE: Consent of the Guarantor is a must.
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CIVIL LAW (AND PRACTICAL EXERCISES)
Extension must be based on some new agreement
between the creditor and the principal debtor by
virtue of which the creditor deprives him of his claim.
1. Where obligation payable in
installments: Where a guarantor is liable
for different payments.
a. General rule: An extension of time
to one or more will not affect the
liability of the surety for the others.
b. Exception: When the unpaid
balance has become automatically
due by virtue of an acceleration
clause for failure to pay an
installment.
i. Effect of exception: The
act of the creditor
extending the payment of
said installment, without
the guarantor’s consent,
discharges the guarantor.
2. Where consent to an extension is
waived in advance by the guarantor or
surety: Amounts to the guarantor’s or
surety’s consent to all the extensions
granted.
Q: When does an extension of the term
discharge the guarantor/surety? (DEW)
1. For a Definite period
2. Pursuant to an Enforceable agreement
between the principal and the creditor
3. Made Without the consent of the surety or
with a reservation of rights with respect to
him.
Q: What is the effect when the guarantor cannot
be subrogated due to the fault of the creditor?
(Art. 2080)
A: If the creditor has acquired a lien upon the
property of a principal debtor, the creditor at
once becomes charged with the duty of
retaining such security, or maintaining such lien
in the interest of the surety, and any release or
impairment of this security as a primary
resource of payment of a debt, will discharge the
surety to the extent of the value of the property
or lien released.
What are the defenses available to Guarantors
(Art. 2081) and Co-Guarantors (Art. 2074)?
a) General rule: All defenses which the
debtor would have interposed against the
creditor (i.e. fraud, prescription, remission,
illegality, etc.).
b) Exception: Those which are purely
personal to the debtor.
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D. QUASI-CONTRACTS
1. NEGOTIORIUM GESTIO
Q: When does a negotiorium gestio arise?
A: One who voluntarily takes charge of the
agency/management of the business or property of
another (without any power from the latter), is
obliged to continue such agency or management
until:
1. The termination of the affair or its incidents; or
2. He has required the person concerned to
substitute him (if the owner is in a position to
do so).
Q: When does a negotiorium gestio NOT arise?
A: However, this juridical relation does not arise in
the following:
1. When the property or business is NOT
neglected or abandoned.
2. If the manager has been impliedly authorized
by the owner.(Art. 2144)
2. SOLUTIO INDEBITI
Q: What is the principle of solutio indebiti?
A: The principle of solutio indebiti provides that if
something is received when there is no right to
demand it, and it was unduly delivered through
mistake, the obligation to return it arises.
In such a case, a creditor-debtor relationship is
created under a quasi-contract whereby the payor
becomes the creditor who then has the right to
demand the return of payment made by mistake,
and the person who has no right to receive such
payment becomes obligated to return the same.
Q: When does the principle of solutio
indebiti apply?
1. A payment is made when there exists no
binding relation between the payor, who has no
duty to pay, and the person who received the
payment;
2. The payment is made through mistake, and not
through liberality or some other cause. (Siga-
An v. Villanueva, GR 173227, 2009)
-------- end of topic --------
X. TORTS AND DAMAGES
A. TORTS
Q: What is a “quasi-delict?”
A: Whoever by act or omission causes damage to
another, there being fault or negligence, is obliged
to pay for the damage done. Such fault or
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CIVIL LAW (AND PRACTICAL EXERCISES)
negligence, if there is no pre-existing contractual
relation between the parties, is called a quasi-delict
and is governed by the provisions of this Chapter.
(Art. 2176)
Q: What is a tort?
A: Acts giving rise to civil liability but are not
necessarily the consequences of crimes or
contractual obligations. (Paras, Pre-week
Handbook in Civil Law, p. 588, 2012)
1. ELEMENTS
Q: What are the elements of a quasi-delict?
A: The following are the essential elements of a
quasi-delict:
1. Culpable act or negligence;
2. Damage to another; and
3. Causal relation between the culpable act or
negligence and the damage to another.
(Art. 2176; Vitug, Civil Law: Volume IV, pp.
327-328, 2006)
Q. Explain the differences between tort and
breach of contract.
A: Their differences are as follows:
1. Negligence is direct, substantive, and
independent in TORT while in BREACH OF
CONTRACT, negligence is merely
incidental to the performance of the pre-
existing contractual obligation;
2. In TORT, the defense of a “good father of a
family” is complete insofar as parents,
guardians, and employers are concerned
while this is not a complete defense in
BREACH OF CONTRACT;
3. There is no presumption of negligence in
TORT and it is incumbent upon the plaintiff
to prove the negligence of a defendant
while in BREACH OF CONTRACT,
negligence is presumed from the breach
itself and the burden is on the defendant to
prove that there was no negligence in
carrying out its obligations (Orient Freight v.
Keihin-Everett, G.R. No. 191937, 2017)
2. CULPA AQUILIANA v.
CULPA CONTRACTUAL v.
CULPA CRIMINAL
Q: What are the distinctions between Culpa
Aquilana, Culpa Contractual, and Culpa
Criminal?
1. Culpa Aquiliana (Culpa Extra
Contractual/Quasi Delict): source of
obligation; wrong or negligence committed
independent of contract and without
criminal intent.
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2. Culpa Contractual (Contractual Proof of

Negligence): wrong or negligence in the existence of the
performance of an obligation or contract. Negligence contract and its Negligence
3. Culpa Criminal (Criminal Negligence): must be breach is prima must be
wrong or negligence in the commission of a proved. facie sufficient proved.
crime. to warrant
(HECTOR S. DE LEON & HECTOR M. DE LEON, recovery.
JR., COMMENTS AND CASES ON OBLIGATIONS AS TO THE DEFENSE
AND CONTRACTS 65-66 (2014)). For the
For the
negligence of an
CULPA CULPA CULPA negligence of
employee,
AQUILANA CONTRACTUAL CRIMINAL an employee,
diligence in the
AS TO BASIS diligence in the
selection and
Source of the selection and
supervision of
obligation is supervision of
the employees
the breach of the employees
Source of the is NOT available
the is a defense of
obligation is the Results as a defense of
contractual the employer.
negligence itself from crime. the employer.
obligation (EDGARDO L. PARAS, CIVIL CODE OF THE PHILIPPINES
(CIVIL CODE, art.
(CIVIL CODE, ANNOTATED: PRESCRIPTION; OBLIGATIONS AND
2176).
arts. 1170- CONTRACTS 144-145 (2016)).
1174; 2201).
AS TO THE NATURE 3. VICARIOUS LIABILITY
Crimes
affecting Q: Define vicarious liability.
public A: Obligations arising from quasi-delict are
interest. demandable not only for one’s own acts or
Only of private
concern. omissions, but also for those of persons for whom
The Penal one is responsible. Article 2180 of the Civil Code
Code provides that a person is not only liable for one's
The Civil Code,
punishes or own quasi-delictual acts, but also for those
by means of
Only of corrects the persons for whom one is responsible for.
indemnification,
concern criminal act. (Spouses Jayme v. Apostol, G.R. No. 163609,
merely repairs
between the 2008)
the damage.
contracting They are This is based on the theory of imputed negligence
parties. not as where certain persons should exercise either
Include all acts in
broad as absolute or limited control or influence over the
which any kind of
they are tortfeasor are disputably presumed negligent in their
fault or
punishable supervision of the tortfeasor. This disputable
negligence
only if there presumption of negligence may be overcome when
intervenes.
is a penal the persons sought to be held vicariously liable
law clearly prove that they observed ordinary diligence to
covering prevent damage, or in the selection and supervision
them. of their employees (in the case of employers).
AS TO THE PRE-EXISTING CONTRACTUAL (Professional Services, Inc. v. Agana, G.R. Nos.
OBLIGATION 126297, 126467, & 127590, 2007)
There may or
There is a pre- There is NO
may NOT be a Q: Distinguish Joint Tortfeasors from Persons
existing pre-existing
pre-existing Vicariously Liable
contractual contractual
contractual PERSONS
relation. obligation. JOINT
obligation. VICARIOUSLY
AS TO NEGLIGENCE TORTFEASORS
LIABLE
Negligence AS TO LIABILITY
Negligence is Negligence
merely an
substantive in the Tortfeasor (under Art.
incident of Solidarily liable
and commission 2176) and the person
performance of (Art. 2194)
independent. of a crime. vicariously liable
an obligation.
AS TO PROOF OF NEGLIGENCE

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(under Art. 2180) are
solidarily liable.
AS TO AMOUNT PAID
The solidary debtor If the person
who pays the injured vicariously liable pays
party may recover from the injured party, he
the other debtor his may recover the
corresponding share in entire amount he
the amount paid. paid from the actual
(Art.1217) tortfeasor (Art.2182)
Q: Distinguish vicarious liability from
respondeat superior.
A: Persons who are vicariously liable are held liable
for their own negligence in failing to diligently
supervise the tortfeasor, and not for the negligence
of the tortfeasor per se. Vicarious liability is not
based on the common law concept of respondeat
superior where persons are conclusively presumed
negligent on account of the negligence of the
tortfeasor, and where the negligence of the
tortfeasor is considered to be the negligence of his
master (Example: agency, breach of contract, and
subsidiary liability in case of crimes). (Delsan
Transport v. C&A Construction, G.R. No. 156034,
2003; Light Rail Transit Association v. Navidad,
G.R. No. 145804, 2003)
Q: Who are Vicariously Liable under Art. 2180?
A: The obligation imposed by article 2176 is
demandable not only for one’s own acts or
omissions, but also for those of persons for whom
one is responsible.
1. The father and, in case of his death or
incapacity, the mother, are responsible for
the damages caused by the minor children
who live in their company.
NOTE: Because vicarious liability is based
on parental authority, with the introduction
of the Family Code, parental authority is
now jointly exercised by the parents.
Therefore, the order of preference
established in 2180(2) no longer applies.
(Libi v. IAC, G.R. No. 70890, 1992)
2. Guardians are liable for damages caused
by the minors or incapacitated persons who
are under their authority and live in their
company.
3. Employers shall be liable for the damages
caused by their employees and household
helpers acting within the scope of their
assigned tasks, even though the former are
not engaged in any business or industry.
4. The State is responsible in like manner
when it acts through a special agent; but
not when the damage has been caused by
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CIVIL LAW (AND PRACTICAL EXERCISES)
the official to whom the task done properly
pertains.
5. Teachers or heads of establishments of
arts and trades, for damages caused by
their pupils and students or apprentices, so
long as they remain in their custody. (Civil
Code, Art. 2180)
The responsibility treated of in this article shall
cease when the persons mentioned prove that they
observed all the diligence of a good father of a family
to prevent damage.
Q: Discuss the summary of rules when a child
commits a tort.
1. Establish or look at the age of the child.
2. General rule if the child is below 18: The
parents or persons exercising substitute
parental authority are vicariously liable.
3. Except: When the child is in the
supervision, instruction or custody of the
persons or entities exercising special
parental authority. In which case, the
person or entity exercising special parental
authority shall be held directly and primarily
liable.
4. Exception to the exception: If the parents
exercising special parental authority is
insolvent or they establish that they
observed due diligence to prevent damage,
then the parents or persons exercising
substitute parental authority will be
subsidiarily liable.
5. General rule if the child is 18-21: Then
the parents will be liable under Art. 2180(2).
Q: What is the nature of the liability of parents
when a child commits a tort?
A: The nature of the liability of parents is not merely
subsidiary. Their liability is primary. This is whether
or not the damage caused by their minor child arose
from quasi-delict or from a criminal act. This is also
the reason why parents can avoid liability if they will
be able to show that they have acted with the
diligence required by law. Because if their liability is
merely subsidiary, they can never pose the defense
of diligence of a good father of a family. (Libi v IAC,
G.R. No. 70890, 1992)
Q: Enumerate the people exercising substitute
parental authority in order of preference.
[GGEsC]
1. Judicially appointed guardian
2. Surviving grandparent pursuant to Art. 214
of the Family Code.
3. Eldest sibling over 21 unless unfit or
disqualified
4. Actual custodian over 21 and unless unfit
or disqualified.
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NOTE: For foundlings, abandoned, neglected, or
abused (FANA) children under Art. 217 of the Family
Code, the orphanage or institution in charge of the
foundling abandoned, neglected, or abused child
shall exercise substitute parental authority. (Civil
Code, Art. 2180)
Q: What must the plaintiff generally prove
against the employer in order make him liable
for the acts/omissions of employees?
1. That the employee is liable under Art. 2176;
2. An employer-employee relationship exists;
and
3. That the employee was acting within the
scope of his assigned tasks. (De Llana v.
Biong, G.R. No. 182356, 2013)
Q: What is the defense of the employer to
prevent liability for the acts/omissions of
employees?
A: In order to overcome the presumption of
negligence that arises against an employer by virtue
of the tort committed by the employee, both have to
be established:
1. Due diligence in the selection; and
2. Due diligence in the supervision.
Evidence of one or successfully proving one is as
good as successfully proving nothing. Proof of only
due diligence in the selection, but not in supervision,
will not absolve liability. (Safeguard Security v.
Tangco, G.R. No. 165732, 2006)
4. RES IPSA LOQUITUR
Q: What is “Res Ipsa Loquitur”?
A: Where the thing which causes injury is shown to
be under the management of the defendant, and
the accident is such as in the ordinary course of
things does not happen if those who have the
management use proper care, it affords reasonable
evidence, in the absence of an explanation by the
defendant, that the accident arose from want of
care. (Layugan v. IAC, G.R. 73998, 1998)
Q: What are the elements of Res Ipsa Loquitur?
1. The accident was of a kind which does not
ordinarily occur unless someone is
negligent;
2. The instrumentality or agency which
caused the injury was under the exclusive
control of the person charged with
negligence;
3. Injury suffered must have not been due to
any voluntary action or contribution on the
person injured
(D.M. Consunji v. Court of Appeals, G.R.
No. 137873, 2001);
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CIVIL LAW (AND PRACTICAL EXERCISES)
4. It must appear that the injured party had no
knowledge or means of knowledge as to
the cause of the accident, or that the party
to be charged with negligence has superior
knowledge or opportunity for explanation of
the accident.
(Malayan Insurance Co. vs. Rodelio Alberto
and Enrico Reyes, G.R. No. 194320).
The doctrine of res ipsa loquitur finds no
application if there is direct proof of absence or
presence of negligence. If there is sufficient proof
showing the conditions and circumstances under
which the injury occurred, then the creative reason
for the said doctrine disappears. (Huang v.
Philippine Hoteliers Inc., G.R. No. 180440, 2012)
Q: What is the captain of the ship rule? Does this
doctrine apply in our jurisdiction?
A: Under the captain of the ship rule, the operating
surgeon is the person in complete charge of the
surgery room and all personnel connected with the
operations whose duty is to obey orders of the
former. Yes, it applies under Philippine law. (PSI v.
Agana, G.R. No. 126297, 2010)
Q: May a hospital be held liable for the
negligence committed by its doctors, who are
not its employees?
A: Yes. The court as applied the doctrine of agency
by estoppel to hold hospitals liable for the negligent
acts of physicians. This doctrine applies when:
1. The hospital represents that a physician or
doctor is its employee or agent (example:
displaying the doctor’s name in the hospital
lobby); and
2. The patient relies on such representations.
(Professional Services, Inc. v. Agana, G.R.
No. 126297, 2007)
Q: What are the elements of the “Doctrine of
Informed Consent”?
A: The elements are:
1. The physician had a duty to disclose
material risks;
2. He failed or inadequately disclosed those
risks;
3. As a direct and proximate result of the
failure to disclose, the patient consented to
the treatment, which he or she would
otherwise not have consented to; and
4. The patient was injured by the proposed
treatment. (Li v. Soliman, G.R. No. 165279,
2011)
5. LAST CLEAR CHANCE
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Q: State the Doctrine of Last Clear Chance which the result would not have occurred. (Vda. de
(also known as the “Doctrine of Discovered Bataclan v. Medina, G.R. No. L-10126, 1957)
Peril” and the Doctrine of Supervening The negligence need not be the event closest in
Negligence). time to the injury; a cause is still proximate, although
A: Whoever had the last fair chance to avoid the farther in time in relation to the injury, if the
impending harm and fails to do so is chargeable with happening of it sets other foreseeable events into
the consequences with reference to the prior motion resulting ultimately in the damage. (Abrogar
negligence of the party. (Picart v. Smith, Jr. G.R. No. v. Cosmos Bottling Co., G.R. No. 164749, 2017)
L-12219, March 15, 1918)
Q: Differentiate between proximate cause and
Alternative Formulation: Where both parties are contributory negligence.
guilty of negligence, but the negligent act of one PROXIMATE CONTRIBUTORY
succeeds that of the other by an appreciable interval CAUSE NEGLIGENCE
of time, the person who has the last fair chance to When his
avoid the impending harm and fails to do so is negligence When his
chargeable with the consequences, without contributes to negligence
reference to the prior negligence of the other party. Nature the principal contributes only to
(Achevara v. Ramos, G.R. No. 175172, September occurrence as his own injury, in
29, 2009) one of its conjunction with the
determining occurrence.
Q: What are the requisites of the Doctrine of factors.
Last Clear Chance?
1. Plaintiff was in a position of danger by his Plaintiff can recover
own negligence; but liability of
Plaintiff cannot
2. Defendant knew of such position of the defendant is
plaintiff; recover
mitigated (Civil
3. Defendant had the last clear chance to Effect Code, Art. 2179)
avoid the accident by exercise of ordinary
care but failed to exercise such last clear
chance and; Q: What is an efficient intervening cause?
4. Accident occurred as proximate cause of A: An intervening cause, to be considered efficient,
such failure. must be one not produced by a wrongful act or
omission, but independent of it, and adequate to
6. DAMNUM ABSQUE INJURIA bring the injurious results.
Any cause intervening between the first wrongful
Q: Define Damnum Absque Injuria cause and the final injury which might reasonably
A: Damage without injury. In order that an award of have been foreseen or anticipated by the original
damages may be proper, the damage sustained by wrongdoer is not such an efficient intervening cause
the plaintiff must proceed from some legal injury as will relieve the original wrong of its character as
caused by the defendant. In other words, there must the proximate cause of the final injury. (Abrogar v.
be damnum et injuria, or the concurrence of three Cosmos Bottling Co., G.R. No. 164749, 2017)
(3) elements:
1. Injury, or the illegal invasion of the plaintiff’s C. NEGLIGENCE
legal right by the defendant;
2. Damage, which is the hurt or harm Q: What is “negligence”?
sustained by the plaintiff; and A: The omission of that degree of diligence which
3. Damages, which is the compensation is required by the nature of the obligation and
awarded by the courts for the damage suffered by corresponds to the circumstances of the persons,
the plaintiff on account of the injury inflicted by the time and place. (Art. 1773)
defendant. (Spouses Custodio v. Court of Appeals,
G.R. No. 116100, 1996) Q: What is the test for determining negligence?
A: Did the defendant in doing the alleged negligent
B. PROXIMATE CAUSE act use that reasonable care and caution which an
ordinarily prudent person would have used in the
Q: What is proximate cause? same situation? If not, then he is guilty of
A: Proximate cause is that cause, which, in natural negligence. (Picart v. Smith, G.R. No. L-12219,
and continuous sequence, unbroken by any efficient 1918)
intervening cause, produces the injury and without

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Q: When is negligence presumed?
A: Negligence is presumed in the following cases:
1. When res ipsa loquitur applies;
2. When the principle of negligence per se
applies (negligence as a matter of law, or
where the defendant has violated a statute,
ordinance, or traffic regulation);
3. When the defendant is a person who may
be held vicariously liable under Art. 2180
(proving that the elements of quasi-delict
are present as to the tortfeasor); and
4. When death or injury results from the
defendant’s possession of dangerous
weapons or substances, such as firearms
or poison, unless the defendant proves that
his possession of these is indispensable to
his business. (Civil Code, Art. 2188)
Q: Is good faith a complete defense in tort
cases?
A: No. Good faith is irrelevant in negligence cases,
particularly, in cases involving quasi-delicts under
Art. 2176. It is irrelevant for purposes of determining
liability. It is relevant only for purposes of
determining the extent of recoverable damages. But
for purposes of determining liability, good faith is not
a defense in negligence cases. Further, the
presence of good faith does not foreclose a violation
of Articles 19 and 21 of the Civil Code on abuse of
rights. (Orient Freight v. Keihin-Everett, G.R. No.
191937, 2017)
D. DAMAGES
1. GENERAL PROVISIONS
Q: What are actual damages?
A: Adequate compensation for the value of loss
suffered or profits which obligee failed to obtain.
Exceptions: As provided for by:
1. Law;
2. Stipulation. (Art. 2199)
Actual damages shall be construed to include all
damages that the plaintiff may show he has
suffered in respect to his property, business, trade,
profession, or occupation, and no other damages
whatsoever. Actual damages are compensatory
only. They simply make good or replace the loss
caused by the wrong. (Algarra v. Sandejas, G.R.
No. L-8385, 1914.).
Indemnification is meant to compensate for the
injury inflicted and not to impose a penalty. A party
is entitled to adequate compensation only for such
pecuniary loss actually suffered and duly proved.
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CIVIL LAW (AND PRACTICAL EXERCISES)
(PNOC Shipping and Transport Corp v. CA, G.R.
No. 107518, 1998)
2. KINDS OF DAMAGES
Q: What are the kinds of damages?
A: Damages may be:
1. Actual or compensatory;
2. Moral
3. Nominal;
4. Temperate or moderate;
5. Liquidated; or
6. Exemplary or corrective (Civil Code, Art.
2197)
Q: What are the kinds of actual damages?
1. Civil indemnity for death (Civil Code, Art.
2206)
2. Lost profits (Civil Code, Art. 2200)
3. Attorney’s fees
4. Value of the loss sustained (Civil Code,
Art. 2199)
5. Interest (Civil Code, Art. 2210)
6. Injury to business standing or commercial
credit (Civil Code, Art. 2205 (2))
7. Temporary or permanent loss of earning
capacity. (Civil Code, Art. 2205 (1))
In actions based on torts or quasi-delicts, actual
damages include all the natural and probable
consequences of the act or omission complained of.
There are two kinds of actual or compensatory
damages:
1. Dano ̃ Emergentee - The loss of what a
person already possesses.
2. Lucro Cesante - The failure to receive as a
benefit that would have pertained to him.
(PNOC Shipping v. Court of Appeals, G.R.
No. 107518, 1998)
Q: When are nominal damages awarded?
A: Nominal damages are adjudicated in order that a
right of the plaintiff, which has been violated or
invaded by the defendant, may be vindicated or
recognized, and not for the purpose of indemnifying
the plaintiff for any loss suffered by him. (Civil Code,
Art. 2221)
Q: What are liquidated damages?
A: Those agreed upon by the parties to a contract,
to be paid in case of breach thereof. (Civil Code, Art.
2226,)
Q: When may liquidated damages be reduced?
1. Iniquitous or unconscionable
2. Partial or irregular performance (Civil Code,
Art. 1229)
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Q: What are temperate or moderate damages?
A: More than nominal but less than compensatory
where some pecuniary loss has been suffered but
its amount cannot be proved with certainty due to
the nature of the case. (Civil Code, Art. 2224)
In cases where the resulting injury might be
continuing and possible future complications directly
arising from the injury, while certain to occur are
difficult to predict, temperate damages can and
should be awarded on top of actual or compensatory
damages; in such cases there is no incompatibility
between actual damages and temperate damages.
Q: What are exemplary damages?
A: Imposed by way of example or correction for the
public good, in addition to the moral, temperate,
liquidated damages or compensatory damages.
(Civil Code, Art. 2229)
Q: Who has the burden of proof to recover
damages?
A: To enable an injured party to recover actual or
compensatory damages, he is required to prove the
actual amount of loss with reasonable degree of
certainty premised upon competent proof and on the
best evidence available. The burden of proof is on
the party who would be defeated if no evidence
would be presented on either side. He must
establish his case by a preponderance of evidence.
A court cannot merely rely on speculations,
conjectures, or guesswork as to the fact and amount
of damages as well as hearsay or uncorroborated
testimony whose truth is suspect. (Heirs of Justiva
v. Gustilo, G.R. No. L-16396, 1963)
Q: Is the award of damages completely barred in
the absence of competent proof?
A: Hearsay evidence, whether objected to or not,
has no probative value. Accordingly, damages may
not be awarded on the basis of hearsay evidence.
However, the absence of competent proof on the
actual damage suffered, a plaintiff is entitled to
nominal damages which, as the law says, is
adjudicated in order that a right of the plaintiff, which
has been violated or invaded by defendant, may be
vindicated and recognized, and not for the purpose
of indemnifying the plaintiff for any loss suffered.
(Civil Code, Art. 2221)
Q: May loss of earning capacity be awarded as
damages for the death of a minor child who has
no history of earnings?
A: Yes. Art. 2206 (1) of the CC provides that
damages for Loss of Earning Capacity (LEC) shall
be assessed and awarded by the court “unless the
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CIVIL LAW (AND PRACTICAL EXERCISES)
deceased on account of permanent physical
disability not caused by the defendant, had no
earning capacity at the time of his death”. Damages
for LEC may be awarded to a minor’s heirs although
he had no history of earnings because
compensation of this nature is awarded not for the
loss of time or earnings, but for the loss of the
deceased’s power or ability to earn money.
(Spouses Pereña v. Spouses Zarate, G.R. No.
157917, 2012)
Q: What damages may be awarded in cases of
death?
A: The damages that may be awarded include the
following: (CALSIME)
1. Civil indemnity, which is the award given
to the heirs as a form of compensation for
the death of the victim. Its grant is
mandatory and does not require proof other
than the fact of death as the result of the
crime or quasi-delict, and the fact that the
accused was responsible therefor. The
Civil Code fixes a minimum amount of
P3,000 and does not fix a maximum.
(People v. Oandasan, Jr., G.R. No.
194605, 2016)
2. Actual damages (e.g., for hospitalization,
funeral expenses, etc.). If the amount of
these expenses is not fully substantiated
through receipts, temperate damages may
be awarded in lieu of actual damages. (Art.
2224, CC; Lim v. Tan, G.R. No. 177250,
2016)
3. Actual damages for Loss of earning
capacity (LEC), which are computed as
follows:
Damages for LEC =2/3(80-X) multiplied by
Net Annual Income where:
a. “X” is the deceased or
permanently incapacitated
person’s age at the time of the
accident; and
b. “Net Annual Income” is equivalent
to a person’s Gross Annual
Income less Necessary and Living
Expenses (in the absence of
evidence, it is presumed that
Necessary and Living Expenses
are equal to half a person’s Gross
Annual Income).
 The formula may be
modified at the court’s
discretion, as when a
minor who was not yet
earning is involved.
c. “X” may be fixed at 21, instead of
the person’s age at the time of his
death or permanent incapacity.
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Courts may presume that persons

graduate from college at the age of
21, and it is only then that they
would start earning a livelihood
d. “Net Annual Income” may be
computed on the basis of the
prevailing minimum wage for
workers in the non-agricultural
sector at the time of the minor’s
death or permanent incapacity.
(Spouses Pereña v. Spouses
Zarate, G.R. No. 157917, 2012;
and Abrogar v. Cosmos Bottling
Co., G.R. No. 164749, 2017)
4. Support for a period not exceeding 5 years
to persons whom the deceased was
obliged to support (Art. 2206 [2], CC);
5. Interest, which may be awarded in the
discretion of the court (Art. 2211);
6. Moral damages (but only to the spouse,
legitimate and illegitimate ascendants and
descendants) (Art. 2206 [3], CC);
7. Exemplary damages.

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TABLE OF CONTENTS: CIVIL LAW: PART II

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I. PROPERTY
A. CLASSIFICATION OF PROPERTY
IMMOVABLES (REAL)
Q: What are the Four Juridical Classifications of
Immovable Properties? (NIDA) (Tolentino, supra,
p. 8)
1. by Nature
2. by Incorporation
3. by Destination
4. by Analogy
Q: What are those that are Immovable by
NATURE? – What cannot be moved from place to
place?
1. Land (Art. 415 (1))
2. Buildings (Art. 415 (1))
3. Roads (Art. 415 (1))
4. Constructions of all kinds adhered to soil
5. Mines, quarries, and slag dumps, while the
matter forms part of the bed (Art. 415 (8))
6. Waters, either running or stagnant (Art. 415 (8))
Q: What are Immovables by INCORPORATION?
– What are those that are essentially movables but
attached to an immovable in a fixed manner to be
an integral part of it?
1. Trees, plants, and growing crops (Art. 415 (2))
2. Everything attached to an immovable in a fixed
manner (Art. 415 (3))
3. Statues, reliefs, paintings, or other objects for
use or ornamentation, placed in buildings or on
land (Art. 415 (4))
4. Animal houses, pigeon houses, beehives,
fishponds, or breeding places of similar nature
(Art. 415 (6))
Q: What are the requisites of the properties that
are attached to an Immovable in a Fixed
Manner?
1. Intent to attach permanently is essential;
2. In case of separation, the injury, breakage,
deterioration must be Substantial. (Art. 415 (3))
Q: What are the requisites of Statues, Reliefs,
Painting, or Other Objects for Use or
Ornamentation?
1. Placed by the Owner of the immovable (not the
object) or his agent;
2. Intent to attach them Permanently to the
tenements. (Art. 415 (4))
Q: What are the requisites of Animal Houses,
Pigeon Houses, Beehives, Fishponds, or
Breeding Places of Similar Nature?
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CIVIL LAW (AND PRACTICAL EXERCISES)
1. Placed by the Owner of the immovable or his
agent;
2. Intent to attach them Permanently to the land.
(Art. 415 (6))
Q: What are considered as Immovable by
DESTINATION?
1. Machinery, receptacles, instruments, or
implements (Art. 415 (5))
2. Fertilizer actually used on a piece of land (Art.
415 (7))
3. Docks and structures which, though floating,
are intended by their nature and object to
remain at a fixed place on a river, lake, or coast
(Art. 415 (9))
Q: What are the requisites of Machinery,
Receptacles, Instruments or Implements for an
Industry or Works?
1. Industry or works must be Carried on inside the
building or on the land;
2. Placed by the Owner of the building or property
or his agent;
3. Machines must be Essential and principal
elements in carrying out the industry;
4. Machines must tend Directly to meet the needs
of said industry or works (adaptability). (Art. 415
(5))
MOVABLES (PERSONAL)
Q: What are considered as Movable? (SIFTOS)
1. Susceptible of appropriation that are not
included in enumeration in immovables. (Art. 416
(1))
2. Immovables that are designated as movables by
special provision of law. (Art. 416 (2))
3. Forces of nature brought under control by
science. (Art. 416 (3))
4. Things which can be transported w/o impairment
of real property where they are fixed (Art. 416
(4))
5. Obligations, which have for their object
movables or demandable sums (credits),
obligations and actions must be legally
demandable - demandable sums must be
liquidated (Art. 417 (1))
6. Shares of stock of agricultural, commercial &
industrial entities although they may have real
estate (Art. 417 (2))
B. OWNERSHIP
1. GENERAL PROVISIONS
Q: What is OWNERSHIP?
A: The independent and general right of a person to
the exclusive enjoyment and control of a thing in his
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possession, enjoyment, disposition, and recovery, at the same time the

subject only to the restrictions or limitations mode, as in succession
established by law and the rights of others. (Art. Subject matter is Subject matter is
427) generally corporeal intangible or
incorporeal (for it is the
a. Bundle of rights fulfillment of the duty or
prestation)
Q: What are the Seven Rights of Ownership? Extinguished by loss or Not extinguished by
(PUFA-DVA) (De leon, Comments and Cases on destruction loss or destruction
Property, 77, 1993)
1. Jus Possidendi (right to possess) c. Modes of acquiring ownership
2. Jus Utendi (right to use and enjoy)
3. Jus Fruendi (right to fruits) Q: What is the Difference between Mode and
4. Jus Abutendi (right to consume) Title?
5. Jus Disponendi (right to dispose) MODE TITLE
6. Jus Vindicandi (right to vindicate or recover) Directly and Serves merely to give
7. Jus Accesionis (right to accessories) immediately produces the occasion for its
a real right acquisition or
b. Distinction between real and existence
personal rights The cause The means
Proximate cause Remote cause
Q: Differentiate Real Right vs. Personal Right. Essence of the right Means whereby that
Jus in Rem Jus in Personam which is to be created essence is
The power of a person The power belonging to or transmitted transmitted
to obtain certain a person to demand
financial or economic from another, as 2. RULES OF ACCESSION
advantage over a definite passive
specific thing, a power subject-debtor, the Q: What is the definition of Accession?
enforceable against the fulfillment of a A: Right of the owner of a thing, real or personal, to
whole world, whether or prestation to give, to do, become the owner of everything which is produced
not he possesses the or not to do. thereby, or which is incorporated or attached
thing. thereto, either naturally or artificially. (Art. 440)
Has a specific object Affects all the present
and future property of Q: What are the Classifications of Accession?
the debtor 1. Accession Discreta
There is one definite There is a definite 2. Accession Continua
active subject (like the active subject (the
owner or usufructuary); creditor); and a definite Q: What is the definition of ACCESSION
the rest of the world is passive subject (the DISCRETA?
the indefinite passive debtor). Thus, a A: Accession Discreta is the extension of the right
subject. Thus, a real personal right is of ownership of a person to the products of a thing
right follows its object in enforceable only which belong to such person. (Paras, Civil Code of
the hands of the against the original the Philippines Annotated Property Articles, 414-
possessor (binding on debtor or a transferee 773, 211, 2016)
the whole world) who has notice or
knowledge Q: When does accession take place?
The right is created It is exercised thru 1. Natural Fruits – spontaneous products of the
directly over a thing another person, against soil and the young of animals.
whom an action may be 2. Industrial Fruits – those produced by lands of
brought any kind through cultivation or labor.
The right is over a thing The right is to a thing 3. Civil Fruits – rent of buildings, the price of
Limited by the value, Not so limited lease of lands and other property and the
use or productivity of amount of perpetual or life annuities or other
the things similar income. (Art. 442)
Created by both mode Created by title alone,
& title except when the title is General Rule: All fruits belong to the owner of a
thing. (Art. 441)

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LO-BPS can acquire OM is entitled to

Exceptions: (PULPA) the materials provided full payment or
1. Possession in good faith by another; (Art. 554 there is full payment. OM may remove
(1)) the materials
2. Usufruct; (Art. 566) provided there is
3. Lease of rural lands; (Art. 1654) no substantial
4. Pledge; injury to work
5. Antichresis. (Art. 2132) done.
B. Good Faith Bad Faith
Q: What is the definition of ACCESSION LO-BPS can acquire OM loses the
CONTINUA? the materials for free materials and will
A: Accession Continua is the extension of the right and will be entitled to be liable for
of ownership of a person to that which is damages due to damages due to
incorporated or attached to a thing which belongs to defects or inferior defects or inferior
such person. quality of the quality of the
materials. materials.
Q: When may it take place? C. Bad Faith Good Faith
1. With respect to real property
LO-BPS can acquire OM is entitled to
a. Accession industrial;
the materials provided full payment for
b. Accession natural
there is full payment the materials plus
2. With respect to personal property
plus damages. damages or OM
a. Adjunction or conjunction;
may remove the
b. Commixtion or confusion;
materials even if
c. Specification. (Paras, supra, p. 209-
there is
210)
substantial injury
to the work done
Q: What are the principles of Accession plus damages.
Industrial?
D. Bad Faith Bad faith
1. Accessory follows the principal.
2. The incorporation or union must be intimate that Same as A. Same as A.
removal or separation cannot be affected
without substantial injury to either or both.
3. Good faith exonerates a person from punitive Q: What is Planting?
liability, but bad faith may give rise to dire A: Planting pertains to a perennial fact. Something
consequences. that will grow and produce fruits year after year
4. Bad faith of one party neutralizes the bad faith without having to be replanted. (Paras, supra, p.
of the other. 220-221)
5. No one should enrich himself at the expense of
another. (Paras, supra, p. 221) Q: What is Sowing?
A: Sowing pertains to an annual crop. Something
that will grow and produce fruits and then you plant
FOR IMMOVABLES again before it will produce fruits again. (Paras,
supra, p. 221)
Q: What are the Two Disputable Presumptions
as To Improvements on Land? Q: What are the Exceptions to the Rule on
1. Works are made by the owner Builders: Possession as Mere Holder?
2. Works are made at the owner’s expense (Art. A: Rule does not apply where the builder, knowing
446) that the land is not his, does not claim ownership
Landowner – Owner of Materials over the land but possesses it as mere Holder,
Builder/Planter/S (OM) agent, usufructuary or tenant. (Paras, supra, p. 243)
ower (LO-BPS)
A. Good Faith Go Q: Is there an Exception to the exception?
od 1. Tenant whose lease is about to expire, but still
Fai sows, not knowing that the crops will no longer
th belong to him.
2. A person constructs a building on his own land,
and then sells the land but not the building to
another.

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a. No question of good faith or bad faith on the Option 2: To oblige To purchase land at
part of the builder can be compelled to the BP to buy the fair market value
remove the building; land or the S to provided its value is
b. New owner will not be required to pay any pay rent unless the not considerably more
indemnity for the building (Golengco v. value of the land is than that of the
Regalado, 48 O.G. 5282) considerably more building or trees.
3. Builder is a belligerent occupant (Republic v. than that of the
Lara, 50 O.G. 5282) building or trees. If BP cannot pay
4. Builder, etc. is a co-owner even if later on, purchase price of the
during the partition, the portion of land used is land or the S cannot
awarded to another co-owner; (Viuda de Arias pay the rent, LO can
v. Aguilar, 40 O.G., 1941) require BPS to
remove whatever has
Q: What are the Rules When Landowner Sells been built, planted or
Land To a 3rd Person Who Is in Bad Faith? sown.
A: Builder must go against the third person. When
the third person has paid the landowner, the builder If the value of land is
may still file a case against the third person. The considerably more
third person may file a 3rd party complaint against than that of the
the landowner. building or trees, BPS
Landowner (LO) Builder/Planter/Sowe cannot be compelled
r (BPS) to buy the land. In
A. Good Faith Good Faith such case, BPS will
Option 1: To To receive payment pay reasonable rent.
acquire whatever for the value of the
has been built, land and necessary, If BPS cannot pay the
planted or sown useful and luxurious rent, LO can eject
and payment of expenses (if LO wants BPS from the land.
the necessary to get luxurious B. Good Faith Bad Faith
expenses, useful improvements) with Option 1: To Loses whatever has
expenses and right of retention acquire whatever been built, planted or
luxurious without any obligation has been built, sown and liable to pay
expenses (if the to pay rent until full planted or sown damages.
LO wants to get payment. for free but must
the luxurious pay necessary Entitled to payment
improvements). To remove the useful expenses and for necessary
improvements luxurious expenses for
provided it does not expenses (if LO preservation without
cause any injury (this wants to get the right of retention.
is part of right of luxurious
retention). improvements) Not entitled to
plus damages. payment for useful
If LO does not get the expenses and cannot
luxurious remove even if
improvements, BPS removal will not cause
can remove the same injury.
provided there is no
injury to the land or If LO wants luxurious
the building. improvements, BPS is
entitled to payment.
The value of the
luxurious
improvements will be
as of the date LO
obtains possession.

If LO does not want

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luxurious C. Bad Faith Good Faith

improvements, BPS
To pay for Option 1: To receive
may remove luxurious
whatever has payment for whatever
improvements if it will
been built, planted has been built,
not cause injury.
or sown plus planted or sown plus
Option 2: To oblige Obliged to pay for land
damages. damages.
BP to buy land or or to pay rent plus
S to pay rent plus damages regardless
Option 2: To remove
damages whether the value of
whatever has been
regardless the land is considerably
built, planted or sown
whether the value more than that of the
even if it will cause
of the land is building or the trees.
injury plus damages.
considerably more
than that of the
BPS has no option to
building or the
acquire or buy the land.
trees.
D. Bad Faith Bad Faith
Option 3: To Obliged to remove or
compel BPS to demolish work done Same as A. Same as A.
remove or plus damages.
Note: This chart is from Atty. Francis H. Ampil
demolish work
done plus
damages.

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ACCESSION

Accession Accession
Discreta Continua

Natural Industrial Civil Real Personal

Fruits Fruits Fruits

Accession Accession
Adjunction/ Specification Mixed
Conjunction
Industrial Natural
Spontaneous rents of buildings
products of the
soil, price of leases of
land &
Building Alluvium (ISTEP) commixtion
Young and other
products of other property
Planting Avulsion Inclusion or confusion
animals amount of
engraftment
perpetual or life
Sowing Change of
annuities or
course Soldadura or
of rivers soldering
other similar
income
Formation Tejido or
of weaving
islands
Escritura or
writing

Pintura or
Painting

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Q: What are the differences between Alluvium

ACCESSION NATURAL and Avulsion?
ALLUVIUM AVULSION
Q: What are the Principal Forms of Accession Deposit of soil is Deposit of soil is
Natural? gradual and sudden or abrupt.
1. Alluvium (Art. 457) imperceptible.
2. Avulsion (Art. 459)
3. Change in the course of rivers (Arts. 461-462) Soil cannot be Soil is identifiable and
4. Formation of islands (Art. 464-465) identified. verifiable.
Deposit of soil belongs Deposit of soil belongs
Q: What is Alluvium? to the owner of the to the owner from
A: The accretion which the banks of rivers gradually property to which it is whose property it was
receive from the effects of the current of the waters attached. detached provided he
and which belong to the owners of lands adjoining the removes the same
said banks. (Art. 457) within two years.

Q: What is Accretion? Q: What are the Essential Elements of Avulsion?

A: Act or process by which a riparian land gradually
and imperceptibly receives addition made by the
water to which the land is contiguous. (Paras, supra,
p. 265)
Q: What are the Essential Elements of Alluvium?
(GCA)
1. Deposit or accumulation of soil or sediment must
be Gradual and imperceptible. (Art. 457)
2. Accretion results from the effects or action of the
Current of the waters of the river. (Gov’t of the
Phils. v. Cabangis, 53 Phil. 112, 1929)
3. The land where accretion takes place must be
Adjacent to the bank of a river. (Art. 457)
(CSK)
1. Segregation and transfer must be caused by the
Current of a river, creek or torrent. (Art. 459)
2. Segregation and transfer must be Sudden or
abrupt. (Canas v. Tuason, 5 Phil. 688, 1929)
3. The portion of land transported must be Known
or identifiable. (Art. 459)
Note: In avulsion, the original owner must remove or
take back his known and identifiable chunk of land
within two years; otherwise, he will lose ownership
over it and the law will transfer ownership to the
owner of the land upon which the chunk of land is
found. (Art. 459)

Registration under the Torrens System does not
protect the riparian owner against the diminution of
the area of his registered land through gradual
changes in the course of an adjoining stream. (Viajar
v. CA, GR No. 77294, 1998)
Lands added to the shores by accretions and
alluvium deposits caused by the action of the sea,
form part of the public domain. When they are no
longer washed by the waters of the sea and are not
necessary for the purposes of public utility, or for the
establishment of special industries, or for the
coastguard service, the Government shall declare
them to be the property of the owners of the estates
adjacent thereto and as an increment thereof.”
(Lanzar v. Dir. Of Lands, GR No. L-31934, 1977)
Q: What is Avulsion?
A: Accretion which takes place when the current of a
river, creek, or torrent segregates from an estate on
its bank a known portion and transfers it to another
estate, in which case, the owner of the estate to
which the segregated portion belonged, retain the
ownership thereof provided he removes the same
within two years. (Art. 459)
Q: What are the Rules Regarding Uprooted
Trees?
A: The uprooted trees must be claimed by the
original owner within six months; otherwise, he will
lose ownership and the law will transfer ownership to
the owner of the land upon which the uprooted trees
are found.
Q: What are the Requisites of Change in the
Course of Rivers?
1. There must be a natural change in the course of
the waters of the river.
2. The change must be abrupt or sudden. (Art. 461)
Q: What are the Rights of Owner of Land
Occupied by New River Course?
1. Right to old bed ipso facto in proportion to area
lost;
2. Owner of adjoining land to old bed: right to
acquire the same by paying its value – Value not
to exceed the value of area occupied by new
bed. (Art. 461)
Q: What are the Islands Belonging to the State
Islands, which may be formed:

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1. On the seas within the jurisdiction of the former may demand its separation even though
Philippines; the principal may suffer injury. (Art.469)
2. On lakes; and 3. Owner of principal in bad faith. (Art.470 (2))
3. On navigable or floatable rivers. (Art.464)
Q: What are the Rules as to Ownership?
Q: What are Islands Formed in Non-Navigable or OWNER OF OWNER OF
Non-Floatable Rivers? PRINCIPAL (OP) ACCESSORY (OA)
1. Belong to the owners of the margins or banks of GOOD FAITH / GOOD FAITH
the river nearest to each of them. BAD FAITH
2. If in the MIDDLE of the river – divided Acquires the May demand separation:
longitudinally in halves (Art.465) accessory If no injury will be caused
- indemnifies the If value of accessory is
FOR MOVABLES former owner for greater than principal -
its value even if damages will be
Q: What is the definition of Adjunction or caused to principal
Conjunction? (expenses is to the one
A: It is the process whereby two (2) movable things who caused the
owned by different persons are joined together conjunction)
without bad faith, in such a way that they form a GOOD FAITH BAD FAITH
single object. (Art. 466)
Owns the Loses the thing
accessory incorporated
Q: What are the Requisites of
Right to damages Indemnify the OP for the
Adjunction/Conjunction? (SID)
damages OP may have
1. The two things belong to Different owners.
suffered
2. They form a Single object.
BAD FAITH GOOD FAITH
3. They are Inseparable; that their separation
would impair their nature or result in substantial Pay OA value of Right to choose between
injury to either component. (Paras, supra, p. 265) accessory or OP paying him its value
principal and or
Q: What are the Classes of Adjunction? (ISTEP) accessory be That the thing belonging
1. Inclusion (engraftment) separated to him be separated even
2. Soldadura (soldering) PLUS though it be necessary to
a. Feruminatio – same metal Liability for destroy the principal thing
b. Plumbatura – different metals damages
3. Tejido (weaving)
4. Escritura (writing) Q: What is mixture?
5. Pintura (painting) (Paras, supra, p. 291) A: Takes place when two or more things belonging to
different owners are mixed or combined to such
General Rule: The owner of the principal thing extent that the components lose their identity. (Art.
acquires the accessory, indemnifying the former 472)
owner for its value. (Art. 466)
Q: What are its Kinds?
Q: What is the Test To Determine Principal? 1. Commixtion – mixture of solid things
A: The principal thing is deemed to be that to which 2. Confusion – mixture of liquid things
the other has been united as an ornament, or for its
use or perfection. (Art. 467.) Q: What are the Rules?
1. Mixture by the will of the owners
If it cannot be determined: (Rule of importance and a. Rights governed by stipulations
purpose) b. Without stipulation: each acquires a right or
1. Greater value = If they are of unequal value interest in proportion to the value of his
2. Greater volume = If they are of equal value material. (Paras, supra, p. 297)
3. Greater merits (Art. 467 & 468) 2. Mixture caused by an owner in good faith or by
chance
Q: When is Separation Allowed? a. Each share shall still be in proportion to the
1. Separation without injury (Art.469) value of their thing (Santos v. Bernabe, 54
2. Separation with injury – accessory is much more Phil. 19, 1929)
precious than the principal; the owner of the 3. Mixed caused by owner in bad faith
a. The actor forfeits his thing;

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b. Liable for damages. (Paras, supra, p. 297) Q: What are the rules when landowner (LO),
builder/planter/sower (BPS) and owner of
Q: What is the definition of Specification? materials (OM) are 3 different persons?
A: Imparting of a new form to the material belonging
to another; or the making of the material of another Landowner Builder/Planter/S Owner of
into a thing of a different kind. (Art. 474) (LO) ower (BPS) the
Materials
Q: What can be done when is a Worker is in Good (OM)
Faith? A. Good Good Faith Good
A: One who, in good faith, employs the material of faith Faith
another in order to make a thing of a different kind Option 1: To receive To
shall appropriate the thing transformed as his own, To acquire payment for the receive
indemnifying the owner of the material for its value. whatever value of the land payment
(Art. 474) has been and necessary, from BPS
built, useful and who is
Q: What may be done when the Material is of planted or luxurious expenses primarily
Greater Value Than the Transformed Thing? sown and (if LO wants to get liable for
A: The owner of the material may: payment of luxurious materials;
1. Appropriate the new thing to himself, after paying the improvements) if BPS is
indemnity for the value of the work; or necessary with right of insolvent,
2. Demand indemnity for the material. (Art. 474) expenses, retention without to
useful any obligation to proceed
Q: What may be done when the Worker is in Bad expenses pay rent until full against
Faith? and payment. LO who
A: The owner of the material shall have the right to: luxurious is
1. Appropriate the work to himself, without paying expenses (if To remove the subsidiari
anything to the worker; or the LO useful ly liable
2. Demand of the latter that he indemnifies him for wants to get improvements with no
the value of the material and the damages he the provided it does not right of
may have suffered. (Art. 474) luxurious cause injury (this is retention.
improveme part of right of
Q: What are the differences among adjunction, nts) retention).
mixture and specification?
If LO does not get
ADJUNCTION MIXTURE SPECIFICATIO the luxurious
N improvements,
Involves at least Involves at Involves at least BPS can remove
2 things least 2 things 2 things the same provided
there is no injury to
the land or the
As a rule, As a rule, co- As a rule, building.
accessory ownership accessory Option 2: To purchase land To
follows principal results follows principal To oblige at fair market receive
the BP to value provided its payment
buy the land value is not from BPS
The things May either The new object or the S to considerably only with
joined retain retain or lose retains or pay rent more than that of right of
their nature respective preserves the unless the the building or retention
natures nature of the value of the trees. and
original object land is material
considerabl If BP cannot pay rent lien
y more than purchase price of until full
d. Rights of Builder/Planter/Sower that of the the land or the S payment.
in Good Faith building or cannot pay the LO is not
trees. rent, LO can subsidiari
require BPS to ly liable.
remove whatever
has been built,

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planted or sown. regardless considerably materials

whether the more than that of from BPS
If the value of land value of the the building or the only.
is considerably land is trees or pay rent
more than that of considerabl and liable to pay
the building or y more than damages
trees, BPS cannot that of the
be compelled to building or
buy the land. In the trees or
such case, BPS S to pay
will pay rent plus
reasonable rent. damages.
Option 3: To demolish or To
If BPS cannot pay To oblige remove what has receive
the rent, LO can BPS to been built, payment
eject BPS from the demolish or planted or sowed for
land. remove and liable for materials
B. Good Good Faith Bad Faith whatever damages. from BPS
Faith has been only.
Same as A. Same as A. Whatever built,
is the planted or
choice of sowed plus
LO, the damages.
OM will D. Good Bad Faith Bad Faith
lose Faith
materials Same as C. Same as C. Since
without both BPS
payment and OM
plus are in bad
liable for faith,
damages treat
. them
C. Good Bad Faith Good both as if
Faith Faith they are
Option 1: BPS will lose To in good
To acquire whatever has receive faith.
whatever been built, payment
has been planted or sown for value Whatever
built, but is entitled to of is the
planted or be paid for materials choice of
sown for necessary principall the LO,
free except expenses and y from OM has
for luxurious BPS; and right to
necessary expenses (if LO if BPS is receive
expenses wants to acquire insolvent, payment
and luxurious subsidiari for
luxurious improvements) ly from materials
expenses (if plus liable to pay LO. from BPS
LO wants to damages. only (LO
acquire has no
luxurious BPS has no right subsidiar
improveme of removal even if y liability
nts) plus removal will not because
damages. cause injury. OM is in
Option 2: To buy the land To good faith
To oblige regardless receive only
BP to buy whether the value payment insofar as
the land of the land is for BPS is

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concerne F. Bad Faith Good Faith Bad Faith

d). Same as E. Same as E. No right
to receive
If LO payment
chooses for
option 1, materials
OM has from BPS
no right to nor LO
remove (who
materials ends up
even if owning
there will the
be no buildings
injury. or trees).
Note: This chart is from Atty. Francis H. Ampil
If LO
chooses A lessee cannot be a builder in good faith. He is
option 2, estopped to deny his landlord’s title, or to assert a
OM has better title not only in himself. (Munar v. CA, GR No.
right of 100740, 1994); (Frederico Geminiano, et al. v. CA, et
removal al., GR No. 120303, 1996)
provided
there will Estoppel applies even if the lessor had no title at the
be no time. (Racaza v. Susan Realty, Inc., GR No. L-20330,
injury. 1966); (Vda. De Bacaling v. Laguna, GR No. L-
26694, 1973); (Santos v. CA, 221 SCRA 42, 1993)
If LO
chooses Even if the lessor promised to sell, it would not make
option 3, Q: Ωthe lessee possessor or builder in good faith to
OM is be covered by the provisions of Art. 448 of the NCC,
liable to if he improves the land. The latter cannot raise the
pay mere expectancy of ownership of the land because
damages the alleged promise to sell was not fulfilled nor its
due to existence even proven. (Jurado, Civil Law Reviewer,
defects 2008)
or inferior
quality of The owner of the land on which a building has been
materials. built in good faith by another has the option to buy the
E. Bad Good Faith Good building or sell his land to the builder, he cannot
Faith Faith refuse to exercise either option. (Sarmiento v. Agana,
To pay for Option 1: To To GR No. L-57288, 1984)
whatever receive payment receive
has been for whatever has payment Where the land’s value is greater than the
built, been built, for value improvement, the landowner cannot compel the
planted or planted or sown of builder to buy the land. A “forced lease” is then
sown plus plus damages. materials created and the court shall fix the terms thereof in
liable to pay principall case the parties disagree thereon. (Depra v. Dumlao,
damages. Option 2: To y from GR No. L-57348, 1985)
remove whatever BPS; and
has been built, if BPS is The right to choose between appropriating the
planted or sown insolvent, improvement or selling the land on which the
even if it will subsidiari improvement of the builder, planter or sower stands,
cause injury plus ly from is given to the owner of the land (not the court)
damages. LO. (Ballatan v. CA, GR No. 125683, 1999)

BPS has no Improvements made prior to the annotation of the

option to acquire notice of lis pendens are deemed to have been made
or buy the land. in good faith. After such annotation, P can no longer

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invoke the rights of a builder in good faith. Should E categorized as possession by stealth and W’s act of
opt to appropriate the improvements made by P, it getting only the consent of one co-owner can be
should only be made to pay for those improvements considered as “strategy.” Thus, it would be a case of
at the time good faith existed to be pegged at its forcible entry. (Cruz v. Catapang, GR No. 164110,
current market value. (Carrascoso v. CA, GR No. 2008)
123672, 2005)
b) Entire Property
C. CO-OWNERSHIP
Any co-owner may file an action under Article 487 not
1. CHARACTERISTICS OF CO- only against a third person but also against another
OWNERSHIP co-owner who takes exclusive possession and
asserts exclusive ownership of the property. (De
Q: What is Co-Ownership?
Guia vs. CA, GR No. 120864, 2003)
A: It is a form of ownership, which exists whenever
an undivided thing or right belongs to different
A co-owner has no right to sell or alienate a concrete,
persons. (Art. 484)
specific, or determinate part of the thing in common
to the exclusion of the other co-owners. (Ulay v.
Q: What are the Elements of Co-ownership? (PUI)
Bustamante, GR 231721 & 231722)
1. Plurality of subjects – many owners
2. Object of ownership must be Undivided
c) Redemption by Other Co-owners
3. Recognition of Ideal shares; no one is an owner
of a specific portion of the property until it is
Q: What is the Right of Redemption?
partitioned.
A: The right of redemption is the right of a co-owner
to recover or get back any share or interest sold by
another co-owner to a stranger or third party. It is an
2. SOURCES OF CO- act of preservation for the benefit of all co-owners.
OWNERSHIP
Q: How is Co-ownership Created? (C-FOLDS) Redemption of the whole property by a co-owner
1. Law does not vest in him sole ownership over said
2. Contracts property. Redemption within the period prescribed by
3. Succession law by a co-owner will inure to the benefit of all co-
4. Fortuitous event/chance (i.e., commixtion) owners. (Mariano v. CA, GR No. L-51283, 1989)
5. Occupancy (i.e.,2 persons catch a wild animal)
6. Donation Co-owners have the right to alienate their pro indiviso
shares even without the knowledge or consent of
Q: What are the Kinds of Co-ownership? another co-owner as long as the alienation covers
1. Ordinary only their shares interests in the common property.
2. Compulsory (Tabasondra v. Constantino, GR No. 196403, 2016)
3. Legal
4. Singular/Particular d) Prescription
5. Incidental
6. Universal General Rule: A co-owner cannot acquire the
7. Contractual whole property as against the other co-owners by
acquisitive prescription. (Art. 494)
3. RIGHTS OF CO-OWNERS
Exception: When there is valid repudiation –
a. Ownership Over Whole Property prescription shall start from such repudiation. (Paras,
b. Sale / Alienation supra, p. 365)

a) Individual Interest Exception to the Exception:

Right to alienate, assign or mortgage own part;
except personal rights like right to use and habitation
A co-owner cannot give valid consent to another to
build a house on co-owned property as such an act
would be tantamount to making an alteration in the
thing owned in common. Entry into the land without
the knowledge of the other co-owners can be
In constructive trusts, prescription does not run.
(Jacinto v. Jacinto, L-17955, L-17957, 1962) (Paras,
supra, p. 366)
Q: What are the elements of Benefits/ Fruits/
Interest/ Income?
a) Right to benefits proportional to respective
interest

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b) Stipulation to contrary is void
c) Right to full ownership of his part and fruits. (Art.
493)
Q: What are the elements Use/ Possession?
a) Right to use thing co-owned
b) For purpose for which it is intended
c) Without prejudice to interest of ownership
d) Without preventing other co-owners from making
use thereof. (Art. 486)
Q: What are the rights when it comes to
Management/Administration?
a) Right to change purpose of co-ownership by
agreement. (Art. 486)
b) Right to bring action in ejectment in behalf of
other co-owner. (Art. 487)
c) Right to compel co-owners to contribute to
necessary expenses for preservation of thing
and taxes. (Art. 488)
d) Right to exempt himself from obligation of paying
necessary expenses and taxes by renouncing
his share in the pro indiviso interest; but can’t be
made if prejudicial to co-ownership. (Art. 488)
e) Right to make repairs for preservation of things;
can be made at will of one co-owner; receive
reimbursement therefrom; notice of necessity of
such repairs must be given to co-owners, if
practicable. (Art. 489)
f) Right to ask for partition anytime. (Art. 494)
g) Right of pre-emption
4. TERMINATION OF CO-
OWNERSHIP
PARTITION
General Rule: Demandable Anytime (Art. 494)
Exception: A co-owner may not successfully
demand a partition: (UNLAD)
1. If by Agreement (for a period not exceeding 10
years, renewable) partition is prohibited. (Art.
494)
2. When partition is prohibited by a Donor or
testator (for a period not exceeding 20 years) –
from whom the property came. (Art. 494)
3. When partition is prohibited by Law. (Art. 494)
4. When a physical partition would render the
property Unserviceable, but in this case, the
property may be allotted to one of the co-owners,
who shall indemnify the others, or it will be sold,
and the proceeds distributed. (Art. 495)
5. When the legal Nature of the common property
does not allow partition
Q: What are the Requisites of Repudiation?
(UKEO)
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CIVIL LAW (AND PRACTICAL EXERCISES)
1. Unequivocal acts of repudiation of the co-
ownership amounting to an ouster of the other co-
owners
2. Positive acts of repudiation have been made
Known
3. Evidence is clear and conclusive
4. Open, continuous, exclusive, notorious
possession. (Santos v. Heirs of Crisostomo, 41
Phil. 342, 1921)
Q: What are the consent requirements for co-
owners in acts of preservation, acts of
administration and acts of alteration?
1. Share in charges proportional to respective
interest; stipulation to contrary is void. (Art. 485)
2. Pay necessary expenses and taxes – may be
exercised by only one co-owner. (Art. 490)
3. Pay useful and luxurious expenses – if
determined by majority
4. Duty to obtain consent of all if thing is to be altered
even if beneficial; resort to court if non-consent is
manifestly prejudicial. (Art. 491)
5. Duty to obtain consent of majority with regard to
administration and better enjoyment of the thing;
majority means majority in the interest not in the
number of co-owners; court intervention if
prejudicial – appointment of administrator. (Art.
492)
6. No prescription to run in favor co-owner as long
as he recognizes the co-ownership; (Art. 494)
Note: For acquisitive prescription to run in favor
of a co-owner, the requisites are:
a) He must have repudiated the co-
ownership through unequivocal acts;
b) Such act of repudiation is made known to
other co-owners
c) Evidence must be clear and convincing
7. Co-owners cannot ask for physical division if it
would render thing unserviceable; but can
terminate co-ownership. (Art. 495)
8. After partition, duty to render mutual accounting
of benefits and reimbursements for expenses.
(Art. 500)
9. Each co-owner has full ownership of his part and
of the fruits and benefits pertaining thereto, and
he may alienate, assign, or mortgage the portion
which may be allotted to him upon the termination
of the co-ownership. It appears that while there is
a single certificate of title, the three lots are
distinguishable from each other. (Art. 493)
Q: What are the rights and obligations at the end
or termination of the co-ownership or upon
partition?
1. Creditors of assignees may take part in division
and object if being effected without their
concurrence but cannot impugn unless there is
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fraud or made notwithstanding their formal
opposition. (Art. 497)
2. Non-intervenors – retain rights of mortgage and
servitude and other real rights and personal
rights belonging to them before partition was
made. (Art. 499)
1. When conditions for partition by sale set forth in
the declaration of restrictions duly registered
have been met.
D. POSSESSION
1. CHARACTERISTICS
Q: What is possession?
A: Possession is the holding of a thing or enjoyment
of a right. (Art. 523)
Q: What are the degrees of possession?
1. Possession without title and in violation of right
of owner
2. Possession with juridical title (juridical
possession); juridical relation exists between the
possessor and the owner
3. Possession with just title but not from true owner,
such that of a possessor in good faith (possessory
right)
4. Possession with title in fee simple or
possession with title of dominion
2. KINDS OF POSSESSION
Q: What are the kinds of possession?
1. Possession in the concept of an owner (Adverse
Possession)
2. Possession in the concept of holder
3. Possession In one’s own name
4. Possession in the name of another – agent;
subject to authority and ratification if not
authorized; negotiorum gestio
a) Voluntary – as when an agent possesses
for the principal (by virtue of agreement)
b) Necessary – as when a mother possesses
for a child still in the maternal womb
c) Unauthorized – this will become the
principal’s possession only after there has
been a ratification without prejudice to the
effects of negotiorum gestio
5. Possession in good faith
6. Possession in bad faith
Q: What are the effects of possession in the
concept of an owner?
1. May be converted into ownership through
acquisitive prescription
2. Bring actions necessary to protect possession;
3. Ask for inscription of possession;
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CIVIL LAW (AND PRACTICAL EXERCISES)
4. Demand fruits and damages from one unlawfully
detaining property.
Q: What are the requisites for personal
acquisition?
1. Must have capacity to acquire possession;
2. Intent to possess;
3. Possibility to acquire possession.
Q: What is the difference between possession
and ownership?
A: Possession and ownership are distinct legal
concepts. Ownership confers certain rights to the
owner, among which are the rights to enjoy the thing
owned and to exclude other persons from possession
thereof. On the other hand, possession is defined
as the holding of a thing or the enjoyment of a
right. Literally, to possess means to actually and
physically occupy a thing with or without a right.
(Heirs of Roman Soriano v. CA, GR No. 128177,
2001)
Q: What is a possessor in good faith?
A: Possessor in Good Faith is one who is not aware
that there exists a flaw in the title or mode which
invalidates it. (Art. 526)
Q: What is a possessor in bad faith?
A: Possessor in Bad Faith is one who is aware of
defect. (Art. 526)
Q: When does bad faith begin?
A: A possessor in good faith may become possessor
in bad faith when he becomes aware of the flaw in his
title or mode of acquisition.
Q: What is the basis of good faith?
A: Mistake upon a doubtful/difficult question of law
may be the basis of good faith (Art. 526; Kasilag v.
Rodriguez, GR No. 46623, 1939)
Q: Who has the burden of proof to prove bad
faith?
A: Burden of proof lies on the one alleging bad faith.
The belief must be a reasonable, not capricious, one.
Possession is presumed to be enjoyed in the same
character in which it is acquired, until contrary is
proven. (Art. 527)
Q: What is the difference between a possessor in
good faith and a possessor in the concept of an
owner?
A: While the possessor in good faith is the one who
believes he is the owner, the possessor in the
concept an owner is one who acts as if he is the
owner.
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3. ACQUISITION OF 2. That of the answer if the date of summons

POSSESSION does not appear.

Q: What are the ways of acquiring possession? Effects of possession in good faith is counted only
1. By the material occupation of the thing or the from the date of the decedent’s death (Art. 534)
exercise of a right;
2. By the fact that the property is subject to the Q: What is the rule regarding minors acquiring
action of one’s will; and possession?
3. By the proper acts and legal formalities 1. May acquire material possession but not right to
established for acquiring the right. (Republic v. possession;
Ng, G.R. No. 182449, 2013) 2. May only acquire them through guardian or legal
representatives (Art. 535)
Q: How is possession acquired by material
occupation or exercise of a right? Q: What is jus vindicandi?
a. Traditio Brevi Manu – when one already in A: Jus vindicandi is the right to recover. The law
possession of a thing by a title other than provides that the owner has a right of action against
ownership continues to possess the same the holder and possessor of the thing to recover it.
under a new title, that of ownership (Art. 428)
b. Constitutum Possessorium—when the
owner continues in possession of the Q: What are the invalid ways to acquire
property alienated not as owner but in some possession?
other capacity. 1. Acquired through force or intimidation as long as
there is a possessor who objects thereto; (Art.
Q: How is possession acquired by subjection of 536)
the thing or right to our will? 2. Affected by acts merely tolerated; or
c. Traditio Longa Manu – effected by mere 3. Clandestine and unknown acts; or
consent or agreement of the parties 4. Acts of violence (Art. 537)
d. Traditio Simbolica – effected by delivering
an object (e.g., key) symbolizing the placing 4. EFFECTS OF POSSESSION
of one thing under the control of the vendee
Q: What are the rights of legal possessor?
Q: How is possession acquired by constructive A: Right to be respected in his possession; if
possession or proper acts and legal formalities disturbed, he shall be protected or restored by
established for acquiring such right of means established by laws.
possession?
a. succession, Q: What are the legal presumptions in favor of
b. donation, possessor?
c. execution of public instruments (Paras, 1. Possessor who recovers possession unjustly
supra) lost shall be deemed to have enjoyed it without
interruption. (Art. 561).
Q: How is possession acquired through 2. Legal presumption of just title (prima facie) and
succession? he is not obliged to show or prove it (Art. 541)
1. If accepted – deemed transmitted without 3. Possession of real property presumes that
interruption from moment of death movables are included (Art. 542)
2. If not accepted (if the heir refuses or is 4. Co-possessor deemed to have exclusively
incapacitated to inherit) – deemed never to have possessed part which may be allotted to him;
possessed the same. (Art. 533) interruption in whole or in part shall be to the
prejudice of all (Art. 543)
Q: What are the effects of bad faith of decedent
on the heir/s? Q: What are the rules on fruits?
General Rule: Heir shall not suffer the
Kinds of Possessor in Possessor in
consequences of the wrongful possession of the Fruits Good Faith Bad Faith
decedent (bad faith is personal)
Exception: When he becomes aware of the flaws
affecting the decedent’s title 1. Civil Entitled to Not entitled to
Fruits fruits from fruits.
Interruption of good faith may take place at: start of
1. The date of summons; or

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possession Must pay term of

until damages as possession.
legal interru rental from
ption. time
possession s
tarted until
possession
is finally
defeated.

2.Natural/I Right to Must account

ndustrial retain fruits. for fruits
Fruits Owner has 2 and return
a. options: value of: (i)
Gathered fruits actually
b. Pending Option 1: received and
Pro-rating (ii) fruits which
(based on the Q: What is possession as a fact?
period of legal possess Q: Possession as a fact cannot be recognized at the
possession) or could same time in two different personalities (Art. 538)
between have received
possessor with due care Q: What are the exceptions?
and owner and diligence. 1. Co-possessor
of: (i) 2. Possession of different concepts or different
expenses; Must pay degrees
(ii) net damages
harvest; and as reasonable Q: What are the rules in case of conflict or dispute
(iii) charges. rent for the regarding possession?
term of 1. Present possessor shall be preferred
Option 2: To possession. 2. If there are 2 possessors, the one longer in
allow posse possession
ssor to stay But entitled to 3. If the period of possession is the same, the one
in possessio necessary exp who presents oldest title;
n until after enses for 4. If both present a title, the Court will determine.
all fruits are preservation, c (Meantime, the thing shall be judicially
gathered ultivation and deposited.) (Art. 538)
(which shall gathering
serve as the of the fruits. Q: What are the rules on expenses and
indemnity fo deterioration/loss?
r expenses). No rights, not
even reimburs Possessor in Good Possessor in Bad
ement of Faith Faith
expenses for
cultivation NECESSARY EXPENSES
(because
by right of Entitled to Entitled to
accession, all reimbursement. reimbursement.
fruits belong to Right of retention No right of retention;
owner pending full must vacate property
without need reimbursement. (recourse is to file
to pay collection case).
indemnity). Liable for damages
as reasonable rent for
Must pay period of possession.
damages
as reasonable USEFUL EXPENSES
rent for the

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Owner has 2 options: No rights.

Q: What must the owner prove?
Option 1:
1. Ownership of the thing
Reimbursement of 2. Loss or unlawful deprivation or bad faith of the
either (i) amount
possessor
spent or (ii) increase
in value with right of
Q: Summarize the Recovery or Non-Recovery
retention until full
Principle
payment.
Owner may a) Possessor in bad faith
Option 2: To
recover without b) Possessor in good faith
allow possessor to
reimbursement (if owner had lost the
remove provided no
property or been
substantial damage
unlawfully deprived of it)
or injury is caused.
the acquisition being
from a private person
(Art. 559)
Owner may If possessor acquired the
LUXURIOUS EXPENSES recover but object in good faith at a
must reimburse public sale or auction; owner
Owner has 2 options: Owner has 2 options: the possessor to pay the price paid.
Option 1: To Option 1: To Owner cannot If possessor acquired it in
allow possessor to allow possessor to recover, even if good faith by purchase from
remove ornaments if remove ornaments if he offers to a merchant’s store/ fairs/
the principal suffers the principal suffers reimburse markets in accordance with
no injury. no injury. (whether or not Code of Commerce &
Option 2: To retain Option 2: To retain the owner had Special laws
the ornament by the ornament by lost or been a) if owner is by his conduct
refunding the amount refunding the value of unlawfully precluded from denying
spent for the ornament at deprived) the seller’s authority to
the ornament. the time owner enters sell
into possession
(which b) if seller has voidable title
means depreciated which has not been
value). avoided at the time of
sale to the buyer in good
faith for value and without
DETERIORATION/LOSS notice of the seller’s
defect in title
No liability unless due Always liable c) if recovery is no longer
to fraudulent intent whether before or
possible because of
or negligence after after service of judicial
prescription
service of judicial summons, for
summons. any cause, even d) if sale is sanctioned by
fortuitous event.
statutory or judicial
authority

Q: What are the requisites for possession of e) if possessor obtained the

movables? goods because he was
1. Good faith an innocent purchaser for
2. Owner voluntarily parted with the possession of value and holder of a
the thing negotiable document of
3. In the concept of owner title to the goods

Possession in Good Faith - Equivalent to Title 5. LOSS OR UNLAWFUL

One who has lost or has been unlawfully deprived of DEPRIVATION OF A
it may recover the thing from whomever possesses MOVABLE
it, ordinarily, w/o reimbursement. (Art. 559)

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Q: When is possession not lost?
When:
1. The movable property remains under the control
of the possessor, even for time being he may not
know their whereabouts (Art. 556)
2. When agent encumbered immovable property
without express authority – except when ratified
(Art. 557)
Q: When may possession still be recovered?
1. Unlawfully deprived or lost (Art. 559)
2. Acquired at public sale in good faith – with
reimbursement (Art. 559)
3. Provision of law enabling the apparent owner to
dispose as if he is owner
4. Sale under order of the court
5. Purchases made at merchant stores, fairs or
markets
6. Negotiable document of title
E. USUFRUCT
1. CHARACTERISTICS
Q: What is a usufruct?
A: Usufruct – is the right to enjoy temporarily the
property of another with the obligation of preserving
its form and substance, unless the title constituting it
or the law otherwise provides (Art. 562)
Q: What are the characteristics or elements of
usufruct?
a. Essential – those without which it cannot be
termed usufruct
a. A real right, whether registered in the
Registry of Property or not;
b. Of a temporary nature or duration
c. Purpose: to enjoy the benefits and derive all
advantages from the object as a
consequence of normal use or exploitation
b. Natural – that which ordinarily is present, but a
contrary stipulation can eliminate it because it is
not essential
d. Obligation of conserving or preserving the
form and substance (value) of the thing
c. Accidental – those which may be present or
absent depending upon the stipulation of the
parties
a. Whether it be a pure or a conditional usufruct
b. The number of years it will exist
c. Whether it is in favor of one person or several,
etc. (Paras, supra, p. 572)
Q: How is usufruct constituted?
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CIVIL LAW (AND PRACTICAL EXERCISES)
1. Legal Usufruct – but is not evident in today’s
laws
2. Will of parties (act inter vivos or last will)
3. By Prescription (Art. 563)
2. CLASSIFICATION
Q: What are the kinds of usufruct as to origin?
1. Legal – created by law such as usufruct of
parents over the properties of their
unemancipated children
2. Voluntary or conventional
a. Created by will of the parties either by
act inter vivos as in contract or donation;
or
b. Act mortis causa as in a last will and
testament
3. Mixed – created by law and by will of the parties
4. Prescriptive – is one acquired by a third person
through continuous use of the usufruct for the
period required by law (Art. 563).
3. RIGHTS AND OBLIGATIONS
OF USUFRUCTUARY
Q: What are the rights of the usufructuary as to
the usufruct itself?
1. To alienate the right of usufruct subject to its
period. (Art. 572)
2. To exercise the right of a co-owner with respect
to the administration and collection of fruits from
the co-owned property, and after the partition
from his share.
Q: What are the obligations of the usufructuary?
1. Pay expenses to 3rd persons for cultivation and
production at beginning of usufruct; those who
have right to fruits should reimburse expenses
incurred (Art. 567)
2. Generally, usufructuary has no liability when due
to wear and tear, thing deteriorates, obliged to
return in that state; except when there is fraud or
negligence, then he shall be liable (Art. 573)
Q: What are the obligations of the usufructuary
during the usufruct?
1. To take care of the property as a good father of
the family. (Art. 589)
2. To answer for damages to the property caused
by a person to whom he has alienated or leased
his right of usufruct. (Art. 590)
3. To make ordinary repairs, and to notify the owner
of the urgent extraordinary repairs which shall be
at the latter’s expense. (Art. 592-593)
4. To permit works and improvements by the owner
on the property not prejudicial to the usufruct.
5. To pay annual taxes and charges on the fruits
and to pay interest on taxes on capital when such
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taxes have been paid by the owner. (Art. 596-
597)
6. To notify the owner of any prejudicial act
committed by third persons, and he shall be liable
should he not do so, for damages, as if it was
caused through his own fault.
7. To pay for court expenses and costs regarding
the usufruct.
8. Insurance
Q: What are the obligations of the usufructuary at
the termination of the usufruct?
1. To return the property in usufruct unless the
usufructuary has a right of retention. (Art. 612)
2. To pay legal interest on the expenses for
extraordinary repairs made, and the proper
interest on taxes paid by the owner. (Art. 594 &
597)
4. EXTINCTION, TERMINATION,
AND EXTINGUISHMENT
Q: How is usufruct extinguished?
Extinguishment of Usufruct: (PLDTERM)
1. Prescription – use by 3rd person
2. Termination of right of person constituting
usufruct
3. Total Loss of thing
4. Death of usufructuary – unless contrary clearly
intention appears
5. Expiration of period of usufruct for which it was
constituted or by the fulfillment of any resolutory
condition provided in the title creating the usufruct
6. Renunciation of usufructuary – express
7. Merger of usufruct and ownership in the same
person (Art. 603)
F. EASEMENTS
Q: What does easement/servitude mean?
(a) It is an encumbrance enjoyed by or in favor
of an immovable called dominant estate
upon another immovable burdened by it
called the servient estate. (easement of
common law, Art. 613).
(b) Or in favor of a community or a person to
whom the servient estate does not belong
(servitude of civil law, Art. 614)
1. CHARACTERISTICS
Q: What are the characteristics of easement?
1. A real right
2. Jus in re aliena
3. Limitation or encumbrance on the servient
estate for another’s benefit
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CIVIL LAW (AND PRACTICAL EXERCISES)
4. There is inherence or inseparability from the
estate to which it belongs
5. It is indivisible
6. It is intransmissible
7. It is perpetual (Paras, supra, p. 646-647).
2. CLASSIFICATION
Q: What are the kinds of easements according to
purpose of easement or the nature of limitation?
1. Positive – one which imposes upon the servient
estate the obligation of allowing something to be
done or of doing it himself. (Art. 616)
2. Negative – that which prohibits the owner of the
servient estate from doing something which he
could lawfully do if the easement did not exist.
(Art 616)
Q: What are the kinds of easements according to
party given the benefit?
1. Real – for the benefit of another belonging to a
different owner (Art. 614)
2. Personal – for the benefit of one or more persons
or community (Art. 614)
Q: What are the kinds of easements according to
the manner they are exercised?
1. Continuous – their use is incessant or may be
incessant; (Art. 615)
2. Discontinuous – used at intervals and depend
upon the acts of man (Art. 615)
Q: What are the kinds of easements according to
whether or not their existence is indicated?
1. Apparent – made known and continually kept in
view by external signs that reveal the use and
enjoyment of the same (Art. 615)
2. Non-apparent – show no external indication of
their existence (Art. 615)
Q: What is the Doctrine of Apparent Sign?
A: The existence of an apparent sign of easement
between two estates, established or maintained by
the owner of both, shall be considered, should either
of them be alienated, as a title in order that the
easement may continue actively and passively,
unless, at the time the ownership of the two estates
is divided, the contrary should be provided in the title
of conveyance of either of them, or the sign aforesaid
should be removed before the execution of the deed.
This provision shall also apply in case of the division
of a thing owned in common by two or more persons.
(Art. 624)
Q: What is the rule regarding the doctrine of
apparent sign?
1. Before the alienation, there is no true
easement
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2. after alienation:
a. there arises an easement if the sign
continues to remain unless there is
a contrary agreement
b. there is no easement if the sign is
removed or if there is an agreement
to this effect (Art. 624)
Q: When is this doctrine applicable?
1. Whether only 1 or both estates are
alienated,
2. Even if there be only 1 estate but there are
2 portions thereof, as long as later on there
is a division of the ownership of the said
portion,
3. Even in the case of division of common
property, though this is not an alienation (Art.
624)
Q: What are the kinds of easements according to
rights given?
1. Right to partially use the servient estate ;
2. Right to get specific materials or objects from the
servient estate;
3. Right to participate in ownership
4. Right to impede or prevent the neighboring estate
from performing a specific act of ownership
Q: What are the kinds of easements according to
source or origin and establishment of easement?
1. Voluntary
2. Mixed
3. Legal (Art. 619)
Q: How is easement established?
1. By law (Legal)
2. By the will of the owners (Voluntary)
3. Through prescription (only for continuous and
apparent easements) (Art. 619)
3. MODES OF ACQUIRING
EASEMENTS
Q: How may Easement/Servitude be acquired?
1. Title, that is, by judicial acts like law, donation,
contact, will (Art. 620).,
2. Prescription of 10 years through adverse
possession or frequent exercises (Art. 620). This
applies only to continues and apparent
easement, either:
(a) Positive from the day the dominant owner
begins to exercise it, e.g., party wall
(b) Negative from the day in which notarial
prohibition is made on servient owner e.g.,
not to obstruct the passage light
3. Deed of recognition by servient owner, e.g.,
right of way (Art. 623).
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CIVIL LAW (AND PRACTICAL EXERCISES)
4. Final judgment, e.g., court declares existence in
an action filed for the purpose (Art. 623).
5. Apparent sign established by owner of two
adjoining estates. Then one estate is alienated
and the easement continuous actively or
passively unless at the time of division, it is
provided that the easement will cease, or the sign
removed before execution of deed (Art. 624).
4. RIGHTS AND OBLIGATIONS
OF THE OWNERS OF THE
DOMINANT AND SERVIENT
ESTATES
Q: What are the rights of the dominant owner?
1. Exercise all rights necessary for the use of the
easement. (Art. 625)
2. Make any works necessary for the use and
preservation of the servitude; subject to the
following conditions: (Art. 627)
(a) The works shall be at his expense, are
necessary for the use and preservation of the
servitude;
(b) They do not alter or render the servitude
more burdensome;
(c) The dominant owner, before making the
works, must notify the servient owner; and
(d) They shall be done at the most convenient
time and manner so as to cause the least
inconvenience to the servient owner
3. Renounce the easement totally if he desires to
exempt himself from contribution to necessary
expenses. (Art. 628)
4. Ask for mandatory injunction to prevent
impairment of his use of the easement. (Resolme
v. Lazo, GR No. L-8654, 1914)
Q: What are the obligations of the dominant
owner?
1. Notify the servient owner of works necessary for
the use and preservation of the servitude. (Art.
627)
2. Contribute to the necessary expenses if there are
several dominant estates in proportion to the
benefits derived from the works. (Art. 628)
3. Cannot alter or impose added burden on the
easement. (Art. 627)
(a) Cannot use the easement except for benefit
originally contemplated
(b) In easement of right of way, he cannot
increase the agreed width of the path nor
deposit soil or materials outside the
boundaries agreed upon
4. Choose the most convenient time and manner in
making the necessary works as to cause the least
inconvenience to the servient owner. (Art. 627)
Q: What are the rights of the servient owner?
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1. Retain ownership of the portion on which the
easement is established and may use it in such a
manner as not to affect the exercise of the
easement. (Art. 630)
2. Change the place or manner of the use of the
easement, provided it be equally convenient. (Art.
629)
3. Use the property subject of the easement unless
there is an agreement to the contrary. (Art. 628)
Q: What are the obligations of the servient
owner?
1. Contribute to the necessary expenses in case he
uses the easement, unless there is an agreement
to the contrary
2. Not to impair the use of the easement
3. In case of impairment, to restore conditions to the
status quo at his expense plus damages (Arts.
627-630)
5. MODES OF
EXTINGUISHMENT
Q: How is easement/servitude extinguished?
Easement/servitude are extinguished by:
1. Merger in one person of the ownership of both
dominant and servient estates.
2. Non-use for 10 years.
3. Dominant and/or servient estates fall into
condition wherein the easement cannot be
used,
4. Expiration of term or fulfillment of condition, in
conditional or temporary easement.
5. Renunciation by dominant owner
6. Redemption agreed upon by dominant and
servient owners
6. LEGAL VS. VOLUNTARY
EASEMENT
Q: What are legal easements?
A: Those imposed by law having for their object
either public use or the interest of private persons.
(Art. 634)
They shall be governed by the special laws and
regulations relating thereto, and in the absence
thereof, by the Civil Code. (Art. 635)
Q: What are voluntary easements?
A: Those which may be established by the owner of
a tenement of piece of land as he may deem suitable,
and in the manner and form which he may deem best,
provided that he does not contravene the laws, public
policy, or public order. (Art. 688)
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CIVIL LAW (AND PRACTICAL EXERCISES)
7. KINDS OF LEGAL
EASEMENTS
Q: What are the kinds of legal easements?
1. Public – for public or communal use
2. Private – for the interest of private
persons/private use, including those relating to
(Art. 637-687): (WALL-DRIP)
(a) Waters
(b) Right of Way
(c) Light and View
(d) Party Wall
(e) Drainage of Building
(f) Intermediate Distances
(g) Against Nuisance
(h) Lateral and Subjacent Support
e. Relating to waters
Q: What are easements relating to waters?
A: Lower estates are obliged to receive:
1. The waters which naturally and without the
intervention of man descend from the higher
estates; as well as
2. Stones or earth which they carry with them
Owner of the lower estate cannot construct works,
which will impede the easement, nor can the owner
of the higher estate make works, which will increase
the burden.
Easement of aqueduct is continuous and apparent
even though the flow of water may not be continuous.
(Arts. 637-638)
f. Right of way
Q: What are the requisites for easement of right
of way?
1. The property is surrounded by estates of others,
2. There is no adequate outlet to a public highway,
3. There must be payment of the proper indemnity.
(Art. 649)
Q: What is the rule on indemnity in easements of
right of way?
1. Permanent passage. If the passage is
permanent, pay the value of land occupied
by the path plus damages. Upon extinction
of the easement, the indemnity is returned
without interest, for the interest is
considered rent.
2. Temporary passage. If temporary, pay for
the damages caused. Indemnity not
returned because damage has already been
caused. (Art. 649)
Q: How is it extinguished?
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A: Extinguishment: Legal or Compulsory Right of
Way
1. When the dominant estate is joined to another
estate which is abutting a public road, the access
being adequate and convenient
2. When a new road is opened giving access to the
isolated estate
3. In both cases: must substantially meet the needs
of the dominant estate. Otherwise, the easement
may not be extinguished.
4. Extinguishment NOT ipso facto; the servient
estate may demand; if he chooses not to, the
easement remains, and he has no duty to refund
indemnity
5. If extinguished, must return the amount received
as indemnity to the dominant owner without any
interest. Interest shall be deemed in payment for
the rent.
Easement of right of way is discontinuous. It may
be exercised only if a person passes or sets foot on
somebody else’s land. An easement of right of way
of railroad tracks is discontinuous because the right
is exercised only if and when a train operation by a
person passes over another’s property. (Bomedco v.
Valdez, GR No. 124699, 2003)
g. Light and View
Q: What is the easement of light and view?
A: Period of prescription for the acquisition shall be
counted:
1. From the time of opening of the window, if
through a party wall
2. From the time of the formal prohibition upon the
proprietor of the adjoining land, if window is
through a wall on the dominant estate (Art. 668)
An easement of light and view can be acquired
through prescription of 10 years counting from the
time when the owner of the dominant estate formally
prohibits, through a notarial instrument, the adjoining
lot owner from blocking the view of a window located
within the dominant estate. (Alolino v. Flores, GR No.
198774, 2016)
Under Property Laws, Easement of light and view is
a posive one if the window or opening is situated in a
party wall, while it is a negave one if the window or
opening is through one's own wall, through a wall of
the dominant estate. However, even if the window is
on one's own wall, still the easement would be
positive if the window is on a balcony or projecon
extending over into the adjoining land. (Spuses
Garcia v. Santos, GR No. 228334, 2019)
G. NUISANCE
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CIVIL LAW (AND PRACTICAL EXERCISES)
Q: What is a nuisance?
A: Nuisance – is any act, omission, establishment,
business, condition of property, or anything else
which:
1. Injures or endangers the health or safety of others
2. Annoys or offends the senses
3. Shocks, defies, or disregards decency or morality
4. Obstructs or interferes with the free passage of
any public highway or street, or any body of water
5. Hinders or impairs the use of property (Art. 694)
Q: What are the kinds of nuisances?
1. Public (or common) nuisance – affects the
public at large or a community or considerable
number of persons or their properties.
2. Private nuisance – affects an individual or a
limited number of persons only (Art. 695)
3. Nuisance Per Se – one which is a nuisance at all
times and under any circumstances, regardless
of location or circumstances, such as a house
constructed on a public street
2. Nuisance Per Accidens – nuisance by reason of
location, surrounding or in the manner it is
conducted or managed. (De Leon, supra, p. 554-
555).
Q: What is the Doctrine of Attractive Nuisance?
A: An attractive nuisance is a dangerous
instrumentality or appliance which is likely to attract
children at play.
Note: The attractive nuisance doctrine generally is
not applicable to bodies of water, artificial as well as
natural, in the absence of some unusual condition or
artificial feature other than the mere water and its
location. (Hidalgo Enterprises, Inc. v. Balandan, GR
No. L-3422, 1952)
Q: Who is liable for damages caused by an
attractive nuisance?
A: One who maintains on his estate or premises an
attractive nuisance exercising due care to prevent
children from playing therewith or resorting thereto, is
liable to a child of tender years who is injured thereby,
even if the child is technically a trespasser in the
premises. (Hidalgo Enterprises, Inc. v. Balandan, GR
No. L-3422, 1952)
1. NUISANCE PER SE
Q: What is a nuisance per se?
A: Nuisance per se is one which is a nuisance at all
times and under any circumstances, regardless of
location or circumstances, such as a house
constructed on a public street or a fishpond
obstructing creek.
2. NUISANCE PER ACCIDENS
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Q: What is a nuisance per accidens?
A: Nuisance per accidens becomes a nuisance by
reason of circumstances, location or surroundings. It
is not a nuisance by its nature but it may become so
by reason of locality, surrounding, or circumstances
(e.g. slaughter house).
3. LIABILITIES
Q: What are the liabilities of person who create
nuisances?
A: He who creates a nuisance is liable for the
resulting damages and his liability continues as long
as the nuisance continues.
Every successive owner or possessor of property
who fails or refuses to abate a nuisance in that
property started by a former owner or possessor is
liable therefor in the same manner as the one who
created it (Art. 696).
4. NO PRESCRIPTION
Lapse of time cannot legalize any nuisance, whether
public or private (Art. 689).
Q: What is the effect of lapse of time?
A: The action to abate a public or private nuisance is
not extinguished by prescription (Art. 1143[2], Civil
Code).
Q: What is the exception?
A: Arts. 698 and 1143(2) do not apply to easements
which are extinguished by obstruction and non-user
for ten years. (See Art. 631).
5. REMEDIES AGAINST A
PUBLIC NUISANCE
Q: What are the remedies against a public
nuisance?
A: The remedies against a public nuisance are:
1. Criminal prosecution under the Revised Penal
Code or a local ordinance;
2. Civil action, including damages;
3. Abatement, summary and without judicial
proceedings
6. REMEDIES AGAINST A
PRIVATE NUISANCE
Q: What are the effects on owners?
A: Owner of nuisance property is not entitled to
compensation. (Art. 436)
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CIVIL LAW (AND PRACTICAL EXERCISES)
All Remedies May be Simultaneously Pursued to
Remove a Nuisance
Aside from the remedy of summary abatement which
should be taken under the parameters stated in Art.
704 (for public nuisances) and Art. 706 (for private
nuisances), a private person whose property right
was invaded or unreasonably interfered with by the
act, omission, establishment, business, or condition
of the property of another, may file a civil action to
recover personal damages.
Abatement may be judicially sought through a civil
action therefor if the pertinent requirements under the
Civil Code for summary abatement, or the requisite
that the nuisance is a nuisance per se, do not concur.
7. CRIMINAL PROSECUTION
Criminal prosecution is only a remedy against a
public nuisance. In private nuisance, criminal
prosecution is NOT a remedy. However, if indeed a
crime has been committed, as defined by the
Revised Penal Code, criminal prosecution can
proceed. (Paras, p. 751)
8. JUDGMENT WITH
ABATEMENT
Besides being held liable for damages or being
sentenced to the penalty, the Court may also order to
abate the nuisance.
9. EXTRAJUDICIAL
ABATEMENT
Q: What are the requisites for extrajudicial
abatement?
1. The nuisance must be specially injurious to the
private person affected
2. No breach of peace or unnecessary injury is
committed
3. Demand has been made upon the owner or
possessor of the property to abate the nuisance
4. Demand has been rejected
5. Abatement must be approved by the district
health officer and executed with the assistance of
the local police
6. Value of the destruction does not exceed P3,000
(Art. 704)
10. SPECIAL INJURY TO
INDIVIDUAL
Q: When may a private person sue on account of
a public nuisance?
a) Ordinarily, it is the mayor who must bring the
civil action to abate a public nuisance
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b) But a private individual can also do so, if the Possession of the real estate alone is sufficient to
public nuisance is SPECIALLY INJURIOUS sustain an action. Legal title is not necessary.
to himself.
I. The action may be for injunction,
abatement or for damages. (Art. H. MODES OF ACQUIRING
703, Paras, p. 750) OWNERSHIP
11. RIGHT OF INDIVIDUAL TO Q: What are the modes of acquiring ownership?
ABATE A PUBLIC NUISANCE A: Modes of Acquiring Ownership (OLD-TIPS)
1. Occupation
Q: What are the requirements for abatement of a 2. Law
public nuisance by a private person? 3. Donation
A: Any private person may abate a public nuisance 4. Tradition
which is specially injurious to him by removing, or if 5. Intellectual Creation
necessary, by destroying the thing which constitutes 6. Prescription
the same, without committing a breach of the peace, 7. Succession (Art. 712)
or doing unnecessary injury. But it is necessary that:
1. Demand has been made upon the owner or 1. OCCUPATION
possessor of the property to abate the nuisance
2. Demand has been rejected Q: What are the requisites?
3. Abatement be approved by the district health 1. Seizure or apprehension
officer and executed with the assistance of the 2. Property seized must be corporeal movable
local police property
4. Value of the destruction does not exceed P3,000 3. Property must be susceptible of appropriation
5. If public nuisance, it must be specially injurious to 4. Intent to appropriate
him (Art. 704) 5. Compliance with requisites or conditions of the
law (De Leon, supra, p. 585).
12. RIGHT TO DAMAGES
Q: What is abandoned property?
A person may maintain an action for damages A: Res derelicta, a thing is considered abandoned
caused by a nuisance. If the nuisance is temporary when:
or recurrent in character, each repetition of it gives 1. The spes recuperandi (expectation to recover) is
rise to a new cause of action. The remedies of gone.
abatement and damages are cumulative; hence, both 2. The animo revertendi (intention to return or to
may be demanded. Even if nuisance no longer exists, have it returned) has been given up by the owner.
the aggrieved person may still pursue a civil action (De Leon, supra, p. 587).
for damages suffered during the existence of the
nuisance. Q: What is un-owned property?
Un-owned Property – res nullius
13. DEFENSES TO ACTION 1. Without an owner
2. Intent to appropriate
Q: What are the available defenses? 3. Compliance with the requisites or conditions of
1. Estoppel the law
- One who voluntarily places himself in a
situation whereby he suffers an injury will not Q: What are some kinds of property acquirable by
be heard to say that his damage is due to a occupation?
nuisance maintained by another 1. Those without an owner, like animals that are
2. The non-existence of the nuisance object of hunting and fishing
3. Impossibility of abatement 2. Hidden treasure (Art. 154)
4. Public necessity (Paras, p. 752) 3. Abandoned movables

14. WHO MAY SUE ON PRIVATE
NUISANCE
Any person injured by a private nuisance may file a
civil action or cause the summary abatement thereof.
Q: What are the kinds of animals?
1. Wild – considered res nullius when not yet
captured; when captured and escaped –
becomes res nullius again.
2. Domesticated animals – originally wild but have
been captured and tamed; now belong to their
capturer; has habit of returning to premises of

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owner; becomes res nullius if they lose that habit
of returning and regain their original state of
freedom.
3. Domestic/tamed animals – born and ordinarily
raised under the care of people; become res
nullius when abandoned by owner. (De Leon,
supra)
Q: What are the rules when movable found is NOT
treasure?
1. Must be returned to owner
2. If finder retains the thing found – he may be
charged with theft
3. If owner is unknown, the movable must e
deposited with the mayor; mayor shall announce
publicly the finding of the movable for 2 weeks in
a way he deems best
4. If owner does not appear 6 months from
publication, the movable shall be awarded to the
finder
5. If owner appears, he is obliged to pay the finder
1/10 of value of property as reward
6. If movable is perishable or cannot be kept without
deterioration or without expenses, it shall be sold
at public auction 8 days after the publication. (Art.
719)
1. The donor must have Capacity to make the
donation of a thing or right
2. Donative Intent (animus donandi) or intent to
make the donation out of liberality to benefit the
donee
3. Delivery, whether actual or constructive of the
thing or right donated
4. Donee must Accept or consent to donation
5. Compliance with the prescribed Form
KINDS OF DONATION
Q: What are the kinds of donation as to
effectivity?
1. Inter vivos - takes effect during the lifetime of the
donor, even though the property shall not be
delivered till after donor’s death or even though it
is subject to resolutory or suspensive condition
(Art. 729 and Art. 730).
2. Mortis Causa - takes effect upon the death of the
donor and shall be governed by the rules of
succession (Art. 728)
3. Propter Nuptias - Donation by reason of and in
consideration of marriage, before its celebration,
in favor of one or both of the future spouses (Art.
82, Family Code)

Q: What are the requisites for abandonment? Q: What are the kinds of donation as to
1. A clear and absolute intention to renounce a right consideration?
or a claim or to abandon a right or property; and 1. Pure and Simple
2. An external act by which that intention is 2. Remuneratory or compensatory
expressed or carried into effect. (De Leon, supra) 3. Modal
4. Onerous
2. DONATIONS
Q: What are the kinds of donation as to effectivity
a. Nature of extinguishment?
1. Pure
Q: What is the nature of donations? 2. Conditional
A: An act of liberality whereby a person disposes 3. With a Term
gratuitously of a thing or right in favor of another,
who accepts it (Art. 725) Q: Distinguish Donation Inter Vivos from
Donation Mortis Causa,
Q: When is donation perfected? DONATION INTER DONATION MORTIS
A: Donation is perfected from the moment the donor VIVOS CAUSA
knows of the acceptance by the donee (Art. 724) Disposition and Disposition happens
acceptance to take upon the death of
The donation is perfected once the acceptance of the effect during lifetime of donor; acceptance by
donation was made known to the donor. Accordingly, donor and donee donee can only be done
ownership will only revert to the donor if the after donor’s death
resolutory condition is not fulfilled. (Quijada v. CA, Already pertains to the Even if there is a term
GR No. 126464, 1998) donee unless there is of effectivity and
a contrary intent effectivity is upon the
Q: What are the characteristics of a donation? death of the donor, still
1. Unilateral entitled to fruits
2. Consensual Formalities required - Formalities required -
follow law on follow law on
Q: What are the requisites? (CIDAF) donations and certain succession to be valid,
kinds of donations and and donation must be in

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law on obligations and the form of a will
contracts (suppletory)
Irrevocable at the Revocable ad mutuum
instance of the donor; (exclusive will of donor)
may be revoked only
by reasons provided
by law
Revoked only for
reasons provided for
by law (except
onerous donations)
Q: What are the badges of Mortis Causa?
1. Title remains with donor (full or naked ownership)
and conveyed only upon death
2. Donor can revoke ad nutum (Villanueva v.
Spouses Branoco, G.R. No. 172804, 2011)
3. Transfer is void if transferor survives transferee
(Del Rosario v. Peralta G. No. 187056, 2010;
Villanueva v. Spouses Branoco, GR No. 172804,
2011)
Q: What are the forms of donation?
1. Movable Property
(a) If the value exceeds P5,000, the donation
and acceptance shall be made in writing.
Otherwise, the donation shall be void.
(b) If the value is below P5,000, donation may be
made orally or in writing.
(c) If oral, it must be with simultaneous delivery
of the thing or of the document representing
the right donated. (Art. 748)
2. Immovable Property
(b) To be valid, donation must be made in a
public instrument, specifying therein the
property donated and the value of the
charges which the done must satisfy.
(c) The acceptance of the donee may be made
in the same deed of donation or in a separate
public document.
(d) If the acceptance is made in a separate
instrument, the donor shall be notified thereof
in an authentic form, and this step shall be
noted in both instruments.
(e) Acceptance must be be made during the
lifetime the donor. (Art.749)
Note: A donation mortis causa must comply with the
formalities of a last will and testament otherwise; it
would be void and would produce no effect.
(Maglasang v. Heirs of Corazon Cabatingan, GR No.
131953, 2002)
If the donation is made in such a way that the full and
naked ownership will pass to the donee upon the
death of the donor, then it is at that time when the
donation will take effect and it is the donation mortis
causa which should be embodied in the last will and
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CIVIL LAW (AND PRACTICAL EXERCISES)
testament. (Maglasang v. Cabatingan, GR No.
131953, 2002)
Q: What is the rule on double donations?
Rule: Priority in time, priority in right
1. If movable – one who first takes possession in
good faith
2. If immovable – one who recorded in registry of
property in good faith
(a) No inscription, one who first took possession
in good faith
(b) In absence thereof, one who presents oldest
title
b. Persons who may give or
receive
Q: who may give or receive a donation?
1. Capacity to be Donor
All persons who may contract and dispose of their
property may give donation. Those who cannot give
consent to a contract cannot be donors.
Q: Who are Disqualified to Donate?
Article 736. Guardians and trustees cannot donate
the property entrusted to them. (n)
Article 739. The following donations shall be void:
(1) Those made between persons who were guilty of
adultery or concubinage at the time of the
donation;
(2) Those made between persons found guilty of the
same criminal offense, in consideration thereof;
(3) Those made to a public officer or his wife,
descendants and ascendants, by reason of his
office.
In the case referred to in No. 1, the action for
declaration of nullity may be brought by the
spouse of the donor or donee; and the guilt of the
donor and donee may be proved by
preponderance of evidence in the same action.
(n)
Note: In case of donation of the same thing to two or
more different persons, the rules on double sale will
apply.
Q: Who May Accept Donations?
1. Natural and juridical persons not especially
disqualified by law
2. Minors and other incapacitated
(a) By themselves if pure and simple donation or
if it does not require written acceptance
(b) By their parents or legal representatives if the
donation is onerous or conditional or needs
written acceptance
1. Natural guardian – not more than 50,000
2. Court appointed – more than 50,000
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3. Conceived and unborn child, represented by
person who would have been guardian if already
born (Arts. 738, 741 & 742)
Q: What Are The Requirements for Acceptance?
1. Acceptance must be made during the lifetime of
the donor and donee (Art. 746)
2. Acceptance may be made personally or through
an agent with special or general and sufficient
power, otherwise, the donation shall be void (Art.
745)
3. Authorization should be in a public instrument.
4. Minors and others who cannot enter into a
contract, shall have acceptance done through
parents or legal representatives (Art. 741)
5. Conceived and unborn children shall have
donation accepted by persons who would legally
represented them if they were already born (Art.
742)
c. Effects and Limitations of
Donations
Q: What are the effects and limitations of
donation?
1. Reservation of sufficient means for support of
donor and relatives.(Art. 750)
2. Donation of future property is prohibited. (Art.
751)
3. Donation shall be limited to what the donor may
give by will. Otherwise, the donation is inofficious
(Art. 752).
A donation would not be legally feasible if the donor
has neither ownership nor real rights that he can
transmit to the donee. (Hemedes v. CA, GR No.
107132, 2008)
Q: What Are The Rights and Obligations of
Donor?
1. Donor may reserve the right to dispose of some
of the things donated, or of some amount or
income charge thereon (Art. 755)
2. Donor may donate the ownership of property to
one person and the usufruct to another (Art. 756)
3. Donor is not obliged to warrant the things donated
except when the donation is onerous, in which
case the donor is liable for eviction or hidden
defects in case of bad faith on his part. (Art. 754).
4. Donor may provide for reversion in his favor. (Art.
757)
Q: What Are The Rights and Obligations of
Donee?
1. If donation is made to several persons jointly, it is
understood to be in equal shares and there is no
right of accretion among them, unless the donor
provides otherwise.
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CIVIL LAW (AND PRACTICAL EXERCISES)
If made to the husband and wife jointly, there is
right of accretion. (Art. 753)
2. Donee is subrogated to all the rights and actions
which in case of eviction would pertain to the
donor (Art. 754)
3. If donation imposes upon the donee the
obligation to pay the debts of the donor, it is
understood to be liable to pay only the debts
previously contracted.
4. If no stipulation regarding the payment of debts,
donee is liable only when the donation has been
made in fraud of creditors
Note: It is always presumed to be in fraud of
creditors, when at the time of donation, the
donor did not reserve sufficient property to
pay his debts. (Art. 759)
d. Revocation and reduction of
donation
REVOCATION
Q: What Is The Nature of Revocation Of
Donations?
1. Affects the whole donation
2. Applies only to donation inter vivos
3. Not applicable to onerous donations
4. Donor can revoke donation if the donee fails to
comply with the conditions imposed by the donor.
Q: What Are The Grounds For Revocation?
Birth, Adoption, Reappearance of a Child
It applies when the donor, at the time he made the
donation, did not have any child or descendant, or
erroneously thought so. Donation may be revoked or
reduced when:
i. Donor should have any children, after
donation, even though they be posthumous
ii. Donor’s child whom he believed to be dead
when he made the donation, turn out to be
living
iii. Donor subsequently adopts a minor child (Art.
760)
Ingratitude
The donation may also be revoked by reason of
ingratitude in the following cases:
a. Donee should commit some offense against
the person, honor or property of the donor,
or of his wife, or children under his parental
authority.
b. Donee imputes to the donor any:
i. Criminal offense; or
ii. Any act involving moral turpitude;
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c. Donee unduly refuses to give support when
the donee is legally or morally bound to give
support to the donor.
Period for action prescribes within one year, counted
from the time the donor:
(a) Had knowledge of the fact; and
(b) It was possible for him to bring the action.
(Art. 769)
Exception to Rule on Intransmissibility of Action
with Regard to Revocation Due to Ingratitude
Q: What is the General Rule?
A: Personal to the donor; heir cannot file an action to
revoke if donor did not file an action to revoke.
Q: What are the Exceptions?
A: Heirs may file in the following cases:
(a) Donor has instituted proceedings but dies
before bringing civil action for revocation
(b) Donor already instituted civil action but died,
heirs can substitute
(c) Donee killed donor or his ingratitude caused
the death of the donor
(d) Donor died without having known the
ingratitude done
(e) Criminal action filed but abated by death
Non-compliance with conditions
Donation may be revoked when the donee fails to
comply with any of the conditions which the donor
imposed.
Action prescribes after 4 years from the
noncompliance with the condition.
Q: When is there No Period Fixed for the
Condition Imposed?
A: General rule is that if the period is not fixed in the
contract, the court can fix the period. However, in a
case where 50 years had passed without the
condition having been fulfilled the Court refused to fix
a period and ruled that the donation can be revoked
for failure to comply with that condition. (Central
Philippine University v. CA, GR No. 112127, 1995)
REDUCTION
Q: What Are The Grounds For Reduction?
1. Birth, appearance, or adoption of a child
2. Failure of the donor to reserve sufficient
means for support of himself or dependent
relatives
3. Failure of donor to reserve sufficient
property to pay off existing debts
4. Inofficiousness
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CIVIL LAW (AND PRACTICAL EXERCISES)
Q: Is Judicial Intervention Necessary for
Automatic Revocation?
In contracts providing for automatic revocation,
judicial intervention is necessary not for purposes of
obtaining a judicial declaration rescinding a contract
but in order to determine whether or not the
rescission was proper.
The stipulation of the parties providing for automatic
revocation of the deed of donation, without prior
judicial action for that purpose, is valid subject to the
determination of the propriety of the rescission
sought. Where such propriety is sustained, the
decision of the court will be merely declaratory of the
revocation, but it is not in itself the revocatory act.
(Zamboanga Barter Traders v. Plagata, G.R. No.
148433, 2008)
Checklist for Donation:
1. Whether onerous or gratuitous – if onerous,
governed by law on contracts
2. If gratuitous, whether mortis causa or inter vivos
– if mortis causa, governed by law on succession
3. If inter vivos, whether perfected or not (made
known to the donor). If no perfection, donation is
void.
4. If perfected, check for the capacity of the donor to
give and the donee to receive. If no capacity,
donation is void.
5. Compliance with form, otherwise void.
(a) Art. 748 (movable); and
(b) Art. 749 (immovable)
3. PRESCRIPTION
a. General Provisions
Q: What are the kinds of Prescription?
1. Acquisitive prescription – it is the acquisition of
ownership and other real rights through
possession of a thing in the manner and under
conditions provided by law.
2. Extinctive prescription – it is the loss or
extinguishment of property rights or actions
through the possession by another of a thing for
the period provided by law or through failure to
bring the necessary action to enforce one’s right
within the period fixed by law (De Leon, p. 701);
also referred to as limitation of actions (Morales
v. CFI, GR No. L-52278, 1980)
b. Prescription Of Ownership And
Other Real Rights
Q: What are the Periods for acquisition?
1. Movable
(a) 4 years with good faith & just title
(b) 8 years if without
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2. Immovable
(a) 10 years with good faith & just title
(b) 30 years if without
Q: What are the General Requisites for
Acquisitive Prescription? (CTPL)
1. Capacity of the possessor to acquire by
prescription
2. Thing capable of acquisition by prescription
3. Possession of thing under certain conditions
4. Lapse of time provided by law
Q: Against Whom May Prescription Run?
1. Minors and incapacitated person who have
parents, guardians or other legal representatives;
2. Absentees who have administrators;
3. Persons living abroad who have managers or
administrators
4. Juridical persons, except the state with regard to
property not patrimonial in character (Art. 1108);
5. Between co-heirs/co-owners (there must be
definite repudiation first)
6. Between owner of property and person in
possession of property in concept of owner
Q: Against Whom Does Prescription Not Run?
1. Between husband and wife, even though there
be a separation of property agreed upon in the
marriage settlements or by judicial decree.
2. Between parents and children, during the
minority or insanity of the latter.
3. Between guardian and ward during the
continuance of the guardianship. (Art. 1109)
a. Ordinary
Q: What is Ordinary Prescription?
1. Possession in the concept of an owner, public,
peaceful and uninterrupted;
2. Within time fixed by law (4 years for movables; 10
years for immovables);
3. Good faith
4. Just title;
b. Extraordinary
Q: What is Extraordinary Prescription?
In extraordinary prescription, ownership and other
real rights over immovable property are acquired
through uninterrupted adverse possession thereof for
30 years without need of title or of good faith.
(Gesmundo v. CA, G.R. No. 119870, 1999).
Q: What Are The Requisites For Extraordinary
Prescription?
1. Possession in the concept of an owner, public,
peaceful and uninterrupted;
2. Within time fixed by law (8 years for movables;
30 years for immovables):
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CIVIL LAW (AND PRACTICAL EXERCISES)
Q: What is meant by Good Faith?
1. Reasonable belief that person who transferred
the thing is the owner and could validly transmit
ownership.
2. Must exist throughout the entire period required
for prescription.
Q: What is meant by Just Title?
When the possession was acquired through one of
the modes recognized by law, but the grantor was not
the owner or could not transmit any right (Art. 1129,
NCC); must be proved and never presumed; only
Titulo Colorado is required.
Q: What is meant by In Concept of Owner?
1. Possession NOT by mere tolerance of owner but
adverse to that of the owner
2. Claim that he owns the property
Q: What is meant by Public, Peaceful &
Uninterrupted?
Must be known to the owner of the thing. The
possession must not be secret or clandestine.
1. Acquired and maintained without violence
2. Uninterrupted (no act of deprivation by
others) possession
c. Prescription of Actions
Q: What Are The Characteristics?
A: Extinction of rights and actions; also referred to as
limitation of actions (Morales v. CFI, GR No. L-52278,
1980) which implies that actions to enforce or
preserve a right or claim must be brought within a
certain period of time.
Q: What Are The Periods?
Prescription of action to recover movables and
immovables
1. Movable
(a) 4 years with good faith & just title
(b) 8 years if without
2. Immovable
(a) 10 years with good faith & just title
(b) 30 years if without
d. When prescription is inapplicable
IMPRESCRIPTIBLE
1. By Offender The offender can never
acquire, through
prescription, movables
possessed through a crime
(Art. 1133).
The action to recover from
the offender is
imprescriptible.
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3. Registered Title to lands registered
lands under the Torrens System
cannot be acquired by
prescription or adverse
possession as against the
registered owner or
hereditary successor (PD
1529). Action to recover
registered land is
imprescriptible.
4. Actions to Imprescriptible
demand right
of way; to
abate nuisance
5. Actions to quiet Imprescriptible
title if plaintiff is
in possession
6. Void contracts Action to declare a contract
void is imprescriptible
Note: An action to annul a
voidable contract
prescribes after 4 years
7. Actions to Action to demand partition is
demand imprescriptible or cannot be
partition; barred by laches, absent a
distinguished clear repudiation of the co-
from laches ownership by a co-owner.
(De Leon, p. 253)
8. Property of Property of public dominion
public cannot be acquired by
dominion prescription for they are
outside the commerce of
men.
Right of reversion or
reconveyance to the State
of things which are not
susceptible of being
appropriated is not barred
by prescription. (De Leon, p.
758)
Land of the public domain
must be declared alienable
and disposable either by the
President or the Secretary
of the DENR to be the
subject of appropriation.
The period of possession
prior to the reclassification
of the land as disposable
cannot be considered in
reckoning the prescriptive
period in favor of the
possessor. (Republic v. De
Guzman Vda. De Joson,
GR No. 163767, 2014)
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CIVIL LAW (AND PRACTICAL EXERCISES)
OTHER ACTION
Prescriptive periods (Art. 1140-1149)
None Right of way
Abatement of nuisance
8 years Action to recover movables – from
time possession is lost (Art. 1140)
30 years Real action over an immovable
property – from time possession is
lost (Art. 1141)
10 years Mortgage action (Art. 1142)
Upon written contract
Obligations arising from law
Court judgment (Art. 1144)
Reconveyance based on implied
constructive trust
6 years Oral Contract
Quasi Contract (Art. 1145)
4 years Injury to rights
Quasi Delict (Art. 1146)
Rescission/Annulment of contract
1 year Forcible entry
Unlawful detainer
Oral Defamation (Art. 1147)
5 years Other actions whose periods are not
fixed by law (Art. 1149)
e. Interruption
Q: What are the types of Interruption of
possession for the purpose of prescription?
(PEN-C)
1. Natural
a. Through any cause, possession ceases for
more than 1 year
b. If 1 year of less – as if no interruption; the
time elapsed shall be counted in favor of
prescription
2. Civil – when there is judicial summons to the
possessor
Note: Exceptions
a) Void for lack of legal solemnities
b) Plaintiff desists from complaint/allows
proceedings to lapse
c) Possessor is absolved from complaint
d) Express or tacit renunciation
3. Express or tacit recognition by the possessor of
the owner’s right;
4. Possession in wartime.
Q: What Are The Rules in Computation of Period?
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1. Present possessor may tack his possession to 3. Such cloud must be due to some Instrument,
that of his grantor or predecessor in interest record, claim, encumbrance or proceeding which
2. Present possessor presumed to be in continuous is apparently valid but is in truth invalid,
possession even with intervening time unless ineffective, voidable or unenforceable prejudicial
contrary is proved to the plaintiff’s title (Art. 476)
3. First day excluded, last day included 4. Plaintiff must Return to the defendant all benefits
received from the latter or reimburse him for
Q: What Are The Requisites for Tacking? expenses that may have redounded to his
1. There must be privity between previous and benefit. (Art. 479)
present possessor
2. Possible when there is succession of rights Q: When Is Quieting Not Applicable?
3. If character of possession different: 1. Questions involving interpretation of documents;
(a) predecessor in bad faith / possessor in good 2. Mere written or oral assertions of claims
faith – use extraordinary prescription Exceptions:
(a) If made in a legal proceeding;
Q: When is There An Interruption of prescription (b) If it is being asserted that the instrument of
of actions? entry in plaintiff’s favor is not what it purports
1. When they are filed before the court to be;
2. When there is a written extrajudicial demand 3. Boundary disputes;
by the creditors 4. Deeds by strangers to the title, unless purporting
3. When there is any written acknowledgement to convey the property of the plaintiff;
of the debt by the debtor (Art. 1155) 5. Instruments invalid on their face;
6. Where the validity of the instrument involves pure
questions of law. (Paras, supra, p. 315-316)
I. QUIETING OF TITLE
2. DISTINCTIONS BETWEEN
Q: What is Quieting of Title? QUIETING TITLE AND
A: It is a remedy or proceeding which has for its REMOVING/PREVENTING
purpose an adjudication that a claim of title to realty CLOUD
or an interest thereon, adverse to the plaintiff, is
invalid or inoperative, or otherwise defective and Q: Distinguish an Action to Quiet Title from an
hence, the plaintiff and those claiming under him may Action to Remove Cloud.
forever be free of any hostile claim. (Baricuatro, Jr. ACTION TO ACTION TO
vs CA, GR No. 105902, 2000) QUIET TITLE REMOVE CLOUD
To end vexatious Procure
Q: What is an action quasi in rem? litigation in cancellation,
A: These are suits filed against a particular person or respect to the release of an
persons in respect to the res; may not be brought for property instrument,
the purpose of settling boundary disputes. concerned encumbrance or
Purpose
claim in the
Applicable to real property or any interest therein. plaintiff’s title- which
The law, however, does not exclude personal affects the title or
property from actions to quiet title. enjoyment of the
property
Note: An action to quiet title is imprescriptible if Plaintiff asserts Plaintiff declares his
brought by the person in possession of the property. own claim and own claim and title,
Otherwise, he must invoke his remedy within the declares that the and at the same
prescriptive period. (Berico v. CA, GR NO. 96306, claim of the time indicates the
1993) defendant is source and nature
unfounded and of the defendant’s
1. REQUISITES Nature
calls on the claim, pointing its
defendant to defects and prays
Q: What Are The Requisites of Action to Quiet justify his claim for the declaration
Title? (TICR) on the property of its invalidity
1. Plaintiff must have a legal or equitable Title or that the same
interest in the real property (Art. 477) may be
2. Cloud in such title

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determined by
the court
Q: What is a Cloud?
It is a semblance of title, either legal or equitable, or
a claim or a right in real property, appearing in some
legal form but which is, in fact, invalid or which would
be inequitable to enforce. (Art. 476)
Q: How to determine the Existence of a Cloud?
(AIP)
1. Instrument or record or claim or encumbrance or
proceeding which is Apparently valid or effective;
2. But is, in truth and in fact, Invalid, ineffective,
voidable, or unenforceable, or extinguished (or
terminated) or barred by extinctive prescription
3. May be Prejudicial to the title. (Paras, supra, p.
302-303)
3. PRESCRIPTION/NON-
PRESCRIPTION OF ACTION
Q: What are the rules on prescription/non-
prescription of action?
1. If plaintiff is in possession
The action does not prescribe. While the
owner continues to be liable to an action,
proceeding, or suit upon the adverse claim,
he has a continuing right to be given aid by
the court to ascertain and determine the
nature of such claim and its effect on his title,
or to assert any superior equity in his favor.
He may wait until his possession is disturbed
or his title is attacked before taking steps to
vindicate his right.
2. If plaintiff is not in possession
The action may prescribe. Even if the action
is brought within the period of limitations, it
may be barred by laches, where there is no
excuse offered for the failure to assert the
title sooner. If somebody else has
possession, the period of prescription for the
recovery of land is either 10 or 30 years
Q: What is The General Rule?
A: An action for reconveyance of a parcel of land
based on implied or constructive trust prescribes in
10 years, the point of reference being the date of
registration of the deed or the date of the issuance of
the certificate of title over the property.
Q: What is the Exception?
A: If plaintiff is in possession, the action is
imprescriptible.
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CIVIL LAW (AND PRACTICAL EXERCISES)
J. ACTIONS TO RECOVER
PROPERTY
Q: What Are The Actions to Recover Ownership
and Possession of Real Property and its
Distinction?
IMMOVABLE PROPERTY
1. ACCION INTERDICTAL OR
EJECTMENT SUIT
This is for cases on forcible entry and unlawful
detainer. This summary action is filed with the
proper MTC within 1 year from the forcible entry
or last demand to vacate in the case of unlawful
detainer.
2. ACCION PUBLICIANA
It is a plenary action to recover the real right of
possession which should be brought in the RTC
within 10 years when dispossession has lasted
for more than one year.
3. ACCION REIVINDICATORIA
It must be filed within the same prescriptive
period as accion publiciana (10 years) with the
proper RTC. It involves both the issue of
possession and ownership, that is:
a. that the plaintiff is the owner of the
land or possessed it in concept of
owner; and
b. the defendant dispossessed him of
the land.
Q: What is Writ of Possession?
A: An order directing the sheriff to place a successful
registrant under the Torrens system in possession of
the property covered by a decree of the court
Q: When is Writ of Possession proper? (FEEEL)
a. Foreclosure, judicial or extra-judicial, of
mortgage. Provided that the mortgagor
has possession, and no third party has
intervened
b. Ejectment
c. Execution sales
d. Eminent domain proceedings
e. Land registration cases
Q: What is Writ of Demolition?
A: Necessarily issued with writ of possession
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A boundary dispute must be resolved in the context
of accion reivindicatoria, not an ejectment case. The
boundary dispute is not about possession, but
encroachment, that is, whether the property claimed
by the defendant formed part of the plaintiff’s
property. (Manalang vs. Bacani, GR No. 156995,
2015)
Q: What is the Effect of the Lapse of One-Year
Period?
A: If the dispossession allegedly took place by any of
such means but the action is not brought within one
year from deprivation of possession, the action is
properly a plenary action of accion publiciana or
accion de reivindiacion. (Penta Pacific Realty Corp v.
Ley Construction and Development Corp., GR
161589, 2014)
Q: What is the General Rule on Writ of Injunction?
A: Generally, not available as a remedy.
Q: What is the Exception?
A: When injunction is allowed:
1. Actions for forcible entry
a) Writ of preliminary injunction within 10 days
from filing of the complaint to restore plaintiff
in possession
b) Courts shall decide within 30 days
2. Ejectment
a) If possessor is a possessor in concept of an
owner (possession de jure) for over a year
and being disturbed by repeated intrusions
of a stranger
b) If an owner, still in possession, desires to
prevent repeated intrusions by a stranger
c) If the possessor is clearly not entitled to
property
Q: What is the doctrine of self-help?
A: Article 429. 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. (n)
Q: What is the doctrine of State of Necessity?
It is the principle that authorizes the destruction of a
property which is lesser in value to avert the danger
posed to another property the value of which is much
greater. (Art. 432)
Q: What are the Requisites of State of Necessity?
1. Interference necessary to avert an imminent
danger.
2. Damage to another much greater than damage to
property (Art. 432)
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CIVIL LAW (AND PRACTICAL EXERCISES)
Q: What Are The Actions for Recovery of
Possession of Movable Property?
MOVABLE PROPERTY: REPLEVIN / MANUAL
DELIVERY
1. Both principal and provisional remedy
2. Plaintiff shall state in the affidavit that he is the
owner of the property claimed, particularly
describing it or that he is entitled to possession,
and that it is wrongfully detained by the other
3. Plaintiff must also give a bond double the
amount of value of the property (Rules of Court,
Rule 60, Sec. 2)
- Note: This is called a replevin bond. A
replevin bond is double the value of the
property.
What is the Period?
4 or 8 years from the time the possession thereof is
lost, in accordance with Art. 1132
————- end of topic ————-
II. CREDIT TRANSACTIONS
A. PERSONAL PROPERTY
SECURITIES ACT (R.A. 11057)
Q: What is the scope of the PPSA?
A:
 Provisions on conventional pledge and
chattel mortgage are repealed. (PPSA, Sec.
66)
 Applies to all transactions of any form that
secure an obligation with movable collateral
 EXCEPT:
o Interests in aircrafts
o Interests in ships
Q: What is a security interest?
A: Property right in movable collateral that secures
payment or other performance of an obligation
(PPSA, Sec. 3[j])
Q: What are the phases of having a a security
interest?
1. Creation
a. A security interest under the PPSA
is created under a security
agreement.
2. Perfection
a. A security interest becomes
effective against third parties at the
moment of its perfection. (PPSA,
Sec. 11)
3. Enforcement or Extinguishment
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a. After default, the secured creditor
may sell or dispose of the collateral
(PPSA, Sec. 49) in a commercially
reasonable manner (PPSA, Sec.
50).
b. The security interest is extinguished
when the secured obligations has
been discharged.
1.CREATION
Q: Who creates a security interest?
A: Grantor
Q: How is a security interest created?
(1) Security agreement
(2) Operating lease for not less than 1 year
(3) Sale of an account receivable
Q: What is the extent covered by a security
interest? (PPSA, Sec. 8)
a. identifiable or traceable proceeds
b. commingled money or funds but limited to
the amount of the proceeds immediately
before they were commingled
c. Fixtures, Accessions, and Commingled
Goods (PPSA, Sec. 25)
i. A perfected security interest in a
movable property which has become a
fixture, or has undergone accession or
commingling shall continue provided
the movable property involved can still
be reasonably traced.
Q: What happens to a security interest when the
collateral is subjected to other transactions/
acts? Continuity of the security interest (PPSA,
Sec. 9)
a. A security interest shall continue in collateral
notwithstanding sale, lease, license,
exchange, or other disposition of the
collateral.
b. Exception: Any party who obtains, in the
ordinary course of business, any movable
property containing a security interest shall
take the same free of such security interest
provided he was in good faith. (PPSA, Sec.
21)
i. Note: There is no good faith if the
security interest was registered prior to
his obtaining the property.
Q: What is a Security Agreement? (PPSA, Sec. 5)
A: Creates a security interest
Q: Can a security agreement create a security
interest over future property?
A: Yes
Q: When is the security interest over future
property deemed created?
BACK TO TOP
CIVIL LAW (AND PRACTICAL EXERCISES)
A: Only when the grantor acquires rights in it or the
power to encumber it.
Q: What is the form of the security agreement?
(PPSA, Sec. 6-7)
i. written contract
ii. signed by the parties
iii. includes the description of the collateral
(reasonably identifiable)
iv. may consist of one or more writings that, taken
together, establish the intent of the parties to
create a security interest
Q: What is covered? –
A: The term includes:
i. an agreement regardless of whether the
parties have denominated it as a security
agreement, between a grantor and a secured
creditor that provides for the creation of a
security interest in collateral (Model Law, Art.
2[jj]);
ii. right of a buyer of accounts receivable (PPSA,
Sec. 3[j])
iii. lessor under an operating lease for not less
than one year (PPSA, Sec. 3[j])
iv. contract of sale where the buyer or other
transferee of a collateral acquires it subject to
a security interest (PPSA, Sec. 3[c][2]);
v. financial lease agreement for the lease of
goods (PPSA, Sec. 3[c][4])
Q: Who are the parties to a security agreement?
a. Grantor may be any of the following:
i. The person who grants a security
interest in collateral to secure its own
obligation or that of another person;
ii. a buyer or other transferee of a
collateral that acquires its right
subject to a security interest;
iii. a transferor in an outright transfer of
an accounts receivable; or
iv. a lessee of goods (PPSA, Sec. 3[c])
b. Secured creditor - person that has the
security interest (PPSA, Sec. 3[i])
c. Debtor - person who owes payment or
other performance of a secured obligation,
whether or not that person is a grantor of
the security right securing payment or
other performance of that obligation,
including a secondary obligor such as a
guarantor of a secured obligation. (Model
Law, Art. 2[h])
2. PERFECTION OF INTEREST
Q: When is a security interest perfected?
A: A security interest shall be perfected when it has
been created and the secured creditor has taken
one of the means of perfection.
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1. What is a control agreement? (PPSA,

Q: How is a security interest perfected? (PPSA, Sec. 3[b])
Sec. 12) a. With respect to securities, means
A security interest may be perfected by: an agreement in writing among the
1. Registration of a notice with the Registry; issuer or the intermediary, the
2. Possession of the collateral by the secured grantor and the secured creditor,
creditor; and according to which the issuer or the
3. Control of investment property and deposit intermediary agrees to follow
account. instructions from the secured
creditor with respect to the security,
Q: What are the general modes of perferction without further consent from the
based on the kind of asset? (PPSA, Sec. 12 and grantor;
Rules, Sec. 4) b. With respect to rights to deposit
account, means an agreement in
Security Security Security
writing among the deposit-taking
Interest in Interest in Interest in
institution, the grantor and the
Tangible Intangible Deposit
secured creditor, according to
Assets Assets Accounts
which the deposit-taking institution
agrees to follow instructions from
1.Registration; 1.Registration; 1.Registration
the secured creditor with respect to
or or ; or
the payment of funds credited to the
2.Possession 2.Control 2.Creation of
deposit account without further
agreement a security
consent from the grantor;
interest in
c. With respect to commodity
favor of the
contracts, means an agreement in
deposit-taking
writing among the grantor, secured
institution or
creditor, and intermediary,
the according to which the commodity
intermediary;
intermediary will apply any value
or
distributed on account of the
3.Control
commodity contract as directed by
agreement
the secured creditor without further
consent by the commodity
Q: Why is perfection significant? customer or grantor;
1. Security interest becomes binding on third 2. Who are the parties to a control
parties agreement?
2. Determines priority a. Intermediary (if the security
3. Right of higher-ranking secured creditor to consists of intermediated
take over enforcement commenced by a securities) - in the regular course of
lower-ranking secured creditor business, maintains securities
accounts for others or both for
Q: How is perfection by control done? others and for its own account and
A: A security interest in a deposit account or is acting in that capacity
investment property may be perfected by control b. Deposit Taking Institution (if the
through: security consists of funds in a
1. Creation of the security interest in favor of deposit account) - refers to a bank
the deposit-taking institution or the defined under General Banking
intermediary; Law, a non-stock savings and loan
2. Conclusion of a control agreement; or association as defined under
3. For an investment property that is an Revised Non-stock Savings and
electronic security not held with an Loan Association Act of 1997, or a
intermediary, the notation of the security cooperative as defined under
interest in the books maintained by or on Philippine Cooperative Code.
behalf of the issuer for the purpose of c. Grantor - grants a security interest
recording the name of the holder of the in collateral to secure its own
securities (PPSA, Sec. 13[a]) obligation or that of another person;
buyer or other transferee of a
Perfection by Control Agreement collateral that acquires its right

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subject to a security interest;

transferor in an outright transfer of Q: What is the order of priority for security
an accounts receivable; or lessee of interests?
goods (PPSA, Sec. 3[b]) A: Generally, the priority of security interests and
d. Secured creditor - has security liens in the same collateral shall be determined
interest over the collateral (PPSA, according to time of registration of a notice or
Sec 3[i]); includes buyer of account perfection by other means, without regard to the
receivable and a lessor of goods order of creation of the security interests and liens.
under an operating lease for not (Rules, Sec. 6.01)
less than one year for purposes of
registration and priority only. Q: What are the priority rules for perfection by
control? (PPSA, Sec. 18)
Q: What is the status of proceeds derived from
the disposition of a collateral? Priority Over
A: Perfection In Proceeds (PPSA, Sec. 14) security interest in a deposit
Upon disposition of a collateral: competing security
account (secured creditor is
1. If the proceeds are in the form of interest perfected
the deposit-taking institution
money, accounts receivable, by any method
or the intermediary)
negotiable instruments or deposit security interest in a deposit
accounts competing security
account or investment
a. a security interest shall interest
property that is perfected by
extend to proceeds of the a control agreement
collateral without further except: security
Note: order of priority among
act and be continuously interest of the
these are determined on the
perfected deposit-taking
basis of the date and time of
2. If the proceeds are NOT in the form institution or the
conclusion of the control
of money, accounts receivable, intermediary
agreements
negotiable instruments or deposit rights to set-off that the Competing
accounts deposit-taking institution security interest in
a. the security interest in such may have against a grantor's the deposit
proceeds must be right to payment of funds account
perfected by one of the credited to a deposit account
means applicable to the security interest in a competing security
relevant type of collateral security certificate interest perfected
within 15 days after the perfected by the secured by registration of a
grantor receives such creditor's possession of the notice in the
proceeds certificate Registry
b. otherwise, the security security interest in
interest in such proceeds electronic securities NOT
shall not be effective security interest in
held with an intermediary
against third parties the same
perfected by a notation of
securities
the security interests in the
Q: What happens to the security interest when perfected by any
books maintained for that
there is a change in the means of perfection? other method
purpose by or on behalf of
A: A security interest shall remain perfected despite the issuer
a change in the means for achieving perfection: security interest in
provided, that there was no time when the security security interest in the same
was not perfected (i.e., there is no gap between the electronic securities held securities
time the security interest was perfected by the first with an intermediary perfected by
and the second mean) (PPSA, Sec. 15) perfected by the conclusion registration of a
of a control agreement notice in the
Q: What should be done when there is an Registry
assignment of the security interest? Note: The order of priority among competing
A: If the creditor assigns the perfected security security interests in electronic securities held
interest, an amendment notice may be registered to with an intermediary perfected by the conclusion
reflect the assignment. (PPSA, Sec. 16) of control agreements is determined on the basis
of the date and time of conclusion of the control
PRIORITY OF SECURITY INTERESTS agreements.

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register
Purchase Money Security Interest (PPSA, Sec. 23) ed

Q: What is a purchase money security interest? 3 A purchase money conflicting

(PPSA, Sec. 3[g]) security interest in: [IIL] perfected
A: A security interest in goods taken by the seller to 1. Inventory security interest
secure the price or by a person who gives value to 2. Intellectual in the same
enable the grantor to acquire the goods to the extent property or inventory,
that the credit is used for that purpose. 3. Livestock intellectual
property or
Q: What are the priority rules for purchase money Conditions: livestock
security interests? 1. perfected when
Priority Over the grantor
1 A purchase money 1. conflicti receives
security interest in ng possession of
equipment and its security the inventory or
proceeds interest livestock, or
IF perfected by 2. rights of acquires rights
registration of notice not a buyer, to intellectual
later than three 3 days lessee, property; and
after the grantor obtains or lien 2. written
possession of the holder notification to
equipment which the holder of the
arise conflicting
between perfected
delivery security interest
of the in the same types
equipme of IIL
nt to the a. By
grantor purchas
and the e money
time the secured
notice is creditor
register b. Before
ed the
grantor
2 A purchase money 1. conflicti receives
security interest in ng possess
consumer goods that is security ion of
IF perfected by interest the
registration of notice not 2. rights of inventor
later than three 3 days a buyer, y or
after the grantor obtains lessee, livestock
possession of the or lien , or
consumer goods holder acquires
which rights in
arise intellect
between ual
delivery property
of the c. May
consum cover
er goods multiple
to the transacti
grantor ons
and the between
time the the
notice is purchas
e money

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secured holder of
creditor the
and the conflicting
grantor perfected
without security
the need interest in
to the same
identify livestock
each before the
transacti grantor
on receives
possession
Other Priority Rules of the food or
Priority Over medicine
Priority for security interest security Grantor's security interest Other claims
Instruments in an instrument interest in Insolvency perfected prior
and or negotiable the on the to the
Negotiable document that is instrument or Priority of a commencement
Documents perfected by negotiable Security of insolvency
(PPSA, Sec. possession of document Interest proceedings in
19) such that is (PPSA, Sec. respect of the
perfected by 22) grantor
registration
of a notice in remain perfected
the Registry and retain the
Repairman/ person who perfected priority
Mechanic’s provides security
Lien services or interest in
(PPSA, Sec. materials with the goods Q: What happens to the security interest when
20) respect to the the collateral is transferred to another party?
goods, in the 1. General Rule: Any party who obtains, in the
ordinary course of ordinary course of business, any movable
business, and property containing a security interest shall NOT
retains take the same free of such security interest
possession of 2. Transferee Exception: if the party was in good
the goods until faith, the party shall shall take the same free of
payment such security interest (PPSA, Sec. 21)
Livestock perfected security other 3. When is there bad faith?
(PPSA, Sec. interest in security a. if the security interest in the
24) livestock securing interest in movable property was registered
an obligation the livestock prior to his obtaining the property
incurred to enable Except:
the grantor to perfected 3. ENFORCEMENT OF SECURITY INTEREST
obtain food or purchase
medicine for the money Q: What is the remedy of the secured creditor
livestock security upon default?
interest in A: After default, the secured creditor may sell or
the livestock dispose of the collateral, publicly or privately (PPSA,
Condition: if Sec. 49) in a commercially reasonable manner
the secured (PPSA, Sec. 50).
creditor
providing Q: How is a security interest enforced?
credit for 1. Judicial Process governed by rules
food or promulgated by the SC
medicine 2. Extrajudicial Process
gives written
notification Q: What are the two ways for a secured creditor
to the to enforce security interest over the collateral?

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a) sale or disposition of the collateral through i. For full satisfaction of the secured
a public or private sale; obligation
b) retention by the creditor of the collateral in 1. If the secured creditor does
total or partial satisfaction of the secured not receive a written
obligation objection from any person
entitled to receive the
Q: What are the rules for recovery in Special proposal within 20 days after
Cases? (PPSA, Sec. 48) the proposal is sent to such
A: Upon default, the secured creditor may without person; or
judicial process: ii. For partial satisfaction of the
a) Instruct the account debtor to make secured obligation
payment to the secured creditor, and apply 1. if the secured creditor
such payment to the satisfaction of the receives the affirmative
obligation secured by the security interest consent of each addressee
after deducting the secured creditor's of the proposal in writing
reasonable collection expenses. within 20 days after the
b) In a negotiable document that is perfected proposal is sent to that
by possession, proceed as to the negotiable person
document or goods covered by the 2. Expedited Repossession of the Collateral
negotiable document; (PPSA, Sec. 47)
c) In a deposit account maintained by the a. How can the secured creditor take
secured creditor, apply the balance of the possession of the collateral for
deposit account to the obligation secured by disposition?
the deposit account; and i. Extrajudicial means
d) In other cases of security interest in a 1. security agreement so
deposit account perfected by control, stipulates; and
instruct the deposit-taking institution to pay 2. possession can be taken
the balance of the deposit account to the without a breach of the
secured creditor's account. peace
ii. Judicial Means
Q: What is the procedure for Enforcement (as 1. If it cannot be done
provided in the PPSA)? extrajudicially.
1. Optional Proposal for Retention of b. What constitutes a breach of peace?
Collateral by Secured Creditor (PPSA, Includes
Sec. 54) i. entering the private residence of
a. After default, the secured creditor may the grantor without permission
propose to the debtor and grantor to ii. resorting to physical violence or
take all or part of the collateral in total intimidation
or partial satisfaction of the secured iii. being accompanied by a law
obligation. enforcement officer when taking
b. Who should the secured creditor possession or confronting the
send a proposal to? grantor
i. The debtor and the grantor; c. What is the process for judicial
ii. Any other secured creditor or lien repossession?
holder i. The secured creditor shall be
1. Must have perfected the entitled to an expedited hearing
security interest at least 5 upon application for an order
days before the proposal is granting the secured creditor
sent to the debtor and possession of the collateral.
grantor ii. The secured creditor shall provide
iii. Claimant of an interest in the a copy of the application, including
collateral all supporting documents and
1. given a written notification to evidence for the order granting the
the secured creditor before secured creditor possession of the
the proposal is sent to the collateral, to the
debtor and the grantor 1. Debtor;
c. When can the secured creditor 2. Grantor; and
retain the collateral?

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3. Any real estate mortgagee (if 4. Sale or Disposition (PPSA, Sec. 49)
the collateral is a fixture) a. How is the disposition to be made?
iii. The secured creditor is entitled to i. Publicly or privately
an order granting possession of ii. Commercially reasonable manner
the collateral upon the court iii. In good faith
finding that b. When is the disposition
1. a default has occurred under commercially reasonable? (PPSA,
the security agreement; and Sec. 50)
2. that the secured creditor has i. if the secured creditor disposes of
a right to take possession of the collateral in conformity with
the collateral. commercial practices among
iv. The court may direct the grantor to dealers in that type of property
take such action as the court ii. A disposition is not commercially
deems necessary and appropriate unreasonable merely because a
so that the secured creditor may better price could have been
take possession of the collateral. obtained by disposition at a
3. Notification of Disposition at least 10 different time or by a different
days before disposition (PPSA, Sec. 51) method from the time and method
a. Who notifies? Secured creditor selected by the secured creditor.
b. Who shall be notified? c. When is the method of disposition
i. Grantor deemed conclusively commercially
1. But the grantor may waive reasonable?
the right to be notified i. When the method has been
ii. Any other secured creditor or lien approved in any legal proceeding
holder d. What should be the condition of the
1. Must have held the security collateral?
interest (perfected by i. Present condition; or
registration) at least 5 days ii. Following any commercially
before the date of notification reasonable preparation or
iii. Claimant of an interest in the processing
collateral e. Who may buy the collateral in the
1. If they notified the secured sale?
creditor and it was received i. A secured creditor may buy the
by the latter before the collateral but only if the collateral
secured creditor gave is of a kind that is
notification of the proposed 1. customarily sold on a
disposition to the grantor recognized market or
c. When is a notification of disposition 2. the subject of widely
sufficient? distributed standard price
i. if it identifies the grantor and the quotations
secured creditor; 5. Application of the Proceeds (PPSA, Sec.
ii. describes the collateral; 52)
iii. states the method of intended a. How should the proceeds of the
disposition; and disposition be applied? The
iv. states the time and place of a proceeds of disposition shall be applied
public disposition or the time after in the following order
which other disposition is to be i. The reasonable expenses for the
made disposition, including reasonable
d. When is notification not needed? attorneys' fees and legal
When the collateral: expenses incurred by the secured
i. is perishable; creditor;
ii. threatens to decline speedily in ii. The satisfaction of the obligation
value; or secured by the security interest of
iii. is of a type customarily sold on a the enforcing secured creditor;
recognized market and
e. Can the right to be notified be iii. The satisfaction of obligations
waived by the grantor? secured by any subordinate
i. Yes, but only after the default. security interest or lien in the

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collateral if a written demand and
proof of the interest are received
before distribution of the proceeds
is completed.
b. What happens if there is a surplus?
Secured creditor shall account for it to
the grantor
c. What happens if there is a deficiency?
Debtor shall be liable
6. Effects of Disposition: Rights of Buyers
and Other Third Parties (PPSA, Sec. 53)
a. If a secured creditor sells the collateral,
the buyer shall acquire the grantor's
right in the asset free of the rights of any
secured creditor or lien holder.
b. If a secured creditor leases or
licenses the collateral, the lessee or
licensee shall be entitled to the benefit
of the lease or license during its term.
c. If a secured creditor sells, leases or
licenses the collateral not in
compliance with the provisions for
enforcement
i. General Rule: buyer, lessee or
licensee of the collateral shall not
acquire the rights or benefits
ii. Exception: buyer, lessee or
licensee had no knowledge of
such violation that materially
prejudiced the rights of the grantor
or another person
7. Redemption (PPSA, Sec. 45)
a. Who is entitled to redeem the
collateral?
i. Any person who is entitled to
receive a notification of disposition
b. How is the redemption done?
i. By paying or otherwise performing
the secured obligation in full,
including the reasonable cost of
enforcement.
c. When is there no right of
redemption?
i. Waiver
ii. The collateral is sold or otherwise
disposed of, acquired or collected
by the secured creditor or until the
conclusion of an agreement by the
secured creditor for that purpose;
and
iii. The secured creditor has retained
the collateral
Q: What is the special right of a higher-ranking
secured creditor during enforcement?
A: Right of Higher-Ranking Secured Creditor to
Take Over Enforcement (PPSA, Sec. 46)
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CIVIL LAW (AND PRACTICAL EXERCISES)
a) Even if another secured creditor or alien
holder has commenced enforcement, a
secured creditor whose security interest has
priority over that of the enforcing secured
creditor or lien holder shall be entitled to
take over the enforcement process.
b) This right may be invoked at any time
before
a. the collateral is sold or otherwise
disposed of, or
b. retained by the secured creditor or
c. until the conclusion of an
agreement by the secured creditor
for that purpose
c) Failure of timely invocation: loses the right
a. Note: the purchaser from the
disposition takes it free from any
lien, including that of a higher-
ranking secured creditor
d) This includes the right to enforce the rights
by any method available to a secured
creditor under the PPSA
REGISTRATION
A. What are the three kinds of notice?
Purpose of Notice
Initial Notice To perfect a security interest
Amendment To provide new information in
Notice the registered notice
To extend the effectivity of the
notice
Termination Secured obligation
Notice discharged; partial release of
collateral; mistaken collateral;
no security agreement; and
extinguished
B. Sufficiency of INITIAL NOTICE (PPSA,
Sec. 28)
a. What are the requirements for
registration to be allowed?
i. If it identifies the grantor by an
identification number;
ii. If it identifies the secured
creditor or an agent of the
secured creditor by name;
iii. If it provides an address for the
grantor and secured creditor or
its agent;
iv. If it describes the collateral;
v. If it states the duration of
effectivity of
the security interest (Rules,
Sec. 5.05); and
vi. If the prescribed fee has been
tendered, or an arrangement
has been made for payment of
fees by other means.
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b. How is authorization to register
done?
i. Each grantor must authorize
the registration of an initial
notice by signing a security
agreement or otherwise in
writing.
c. Can a notice be registered before a
security agreement is concluded?
Yes.
i. Once a security agreement is
concluded, the date of
registration of the notice shall
be reckoned from the date the
notice was registered.
ii. A notice of lien may be
registered by a lien holder
without the consent of the
person against whom the lien
is sought to be enforced.
d. How many notices are needed for
multiple security agreements?
i. The registration of a single
notice may relate to security
interests created by the
grantor under one or more
than one security agreement.
(PPSA, Sec. 29)
C. When is a notice effective? (PPSA, Sec.
30)
1. At the time the notice is
discoverable in the Registry
records
2. During term stated in the notice
3. Notice substantially complying
with requirements
a. Except those that are
seriously misleading (i.e.,
does not provide the
identification number of the
grantor)
4. Retrievable in a search of the
Registry against the correct
identifier of the grantor
D. AMENDMENT NOTICE (PPSA, Sec. 32 and
Rules, Sec. 5.08)
a. How can a notice be amended?
i. A notice may be amended by
the registration of an
amendment notice that:
1. Identifies the
initial notice by its
registration
number; and
2. Provides the new
information.
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CIVIL LAW (AND PRACTICAL EXERCISES)
b. Who can file a valid amendment
notice?
i. By the secured creditor alone,
if the changes to
the security interest can be
effected with the sole consent
of the secured creditor; or
ii. By the grantor, if the changes
to the security interest
requires the grantor's consent.
c. Can an amendment notice add
collaterals?
i. An amendment notice that
adds collateral that is not
proceeds must be authorized
by the grantor in writing.
d. Can an amendment notice add a
grantor?
i. An amendment notice that
adds a grantor must be
authorized by the added
grantor in writing.
e. Who is bound by the amendment
notice?
i. An amendment notice shall be
effective only as to each
secured creditor who
authorizes it.
ii. An amendment notice that
adds collateral or a grantor
shall be effective as to the
added collateral or grantor
from the date of its registration.
f. What can be done if a perfected
security interest is assigned?
g. If a secured creditor assigns a
perfected security interest, an
amendment notice may be registered
to reflect the assignment.
E. What is the period of effectiveness of a
notice? Continuation of Notice (PPSA, Sec.
33)
a. The period of effectiveness of a notice
may be continued by registering an
amendment notice that identifies the
initial notice by its registration
number.
b. may be registered only within 6
months before the expiration of the
effective period of the notice
F. How is the effectiveness of a notice
terminated? (PPSA, Sec. 34)
a. The effectiveness of a notice may be
terminated by registering a
termination notice that:
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i. Identifies the initial notice by its
registration number; and
ii. Identifies each secured
creditor who authorizes the
registration of the termination
notice.
b. A termination notice terminates
effectiveness of the notice as to each
authorizing secured creditor.
G. When can the grantor demand an
amendment or termination of a notice?
(PPSA, Sec. 39 and Rules, Sec. 5.13)
a. A grantor may give a written demand
to the secured creditor for the
amendment or termination of the
effectiveness of the notice in the
following cases:
i. All the obligations under
the security agreement to
which the registration relates
have been performed and
there is no commitment to
make future advances;
ii. The secured creditor has
agreed to release part of the
collateral described in the
notice;
iii. The collateral described in the
notice includes an item or kind
of property that is not a
collateral under
a security agreement between
the secured creditor and the
grantor;
iv. No security agreement exists
between the parties; or
v. The security interest is
extinguished in accordance
with the PPSA.
H. When is there compulsory amendment or
termination? By Court Order (PPSA, Sec.
42)
(a) The court may, on application by
the grantor issue an order that the
notice be terminated or amended in
accordance with the demand, which
order shall be conclusive and
binding on the LRA: provided, that
the secured creditor who disagrees
with the other
(b) The court may take any order it
deems proper for the purpose of
giving effect to the order made
under the first paragraph.
(c) The LRA shall amend or terminate
a notice in accordance with a court
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CIVIL LAW (AND PRACTICAL EXERCISES)
order as soon as reasonably
practicable after receiving the
order.
WHAT ARE THE RIGHTS OF THE GRANTOR?
1. Right to disclosure of information from
secured creditor
a. The secured creditor must provide
to the grantor at its request:
i. The current amount of the
unpaid secured obligation;
and
ii. A list of assets currently
subject to a security
interest. (R.A. 11057,
Section 37[a])
2. Right to demand amendment or termination
of notice
3. Right to notification to dispose collateral
from the secured creditor
4. Right of redemption
Q: What are the rights of the secured creditor?
1. Right to require payment for a fee for a
request of disclosure of information from the
grantor
a. The secured creditor may require
payment of a fee for each request
made by the grantor, but the grantor
is entitled to a reply without charge
once every six (6) months.
However, secured creditor shall not
charge any fee for compliance with
a demand received under Section
39.
2. Right to take over enforcement
3. Right to expedite repossession of the
collateral
4. Right to recover in special cases
5. Right to dispose of Collateral
6. Right to retain collateral
B. REAL ESTATE MORTGAGE
Q: What are the elements of a Valid Mortgage?
(FAVFAP)
1. Valid obligation exists;
2. Constituted to secure the Fulfillment of a
principal obligation;
3. Mortgagor be the Absolute owner of the
thing pledged or mortgaged;
4. Mortgagor has Free disposal of the
property, and in the absence thereof, that
he be legally authorized for the purpose;
5. When the principal obligation becomes due,
the thing in which the mortgage consists
may be Alienated for the payment to the
creditor; and
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6. Appears in a Public document duly
recorded in the Registry of Property to be
[validly constituted].
NOTE: If the instrument is not recorded, the
mortgage is nevertheless binding between
the parties.
Q: Can X, as a co-owner, mortgage such real
property?
A: X as a co-owner of the mortgaged property could
validly convey through sale or mortgage the portion
belonging to her. Under Art. 493 of the Civil Code, the
effect of the alienation or mortgage, with respect to
the co-owners, shall be limited to the portion which
may be allotted to him in the division upon the
termination of the co-ownership. (Bulatao v.
Estonactoc, G.R. No. 235020, 2019)
Q: What is the effect of the invalidity of the
mortgage on the principal obligation?
A: The principal obligation remains valid and the
deed of mortgage remains as the evidence of the
personal obligation. (Rural Bank of Cabadbaran, Inc.
v. Melecio-Yap, G.R. No. 178451, 2014)
Q: Petitioners X and Y owned a parcel of land. In
1987, they each obtained a loan from
respondents Z and used their land as collateral
for the loan obligation. Z immediately began
occupying the land. In 2003, X obtained an
additional loan and in 2004, Y did the same. Later
in 2004, X and Y informed Z of their intent to
redeem their property. Z, however, refused,
forcing X and Y to file a Complaint for redemption
of mortgaged properties in 2005. Z claims that X
and Y sold the property to them under a
Memorandum of Deed of Sale with Right of
Repurchase. Both the RTC and CA found that the
transaction was an equitable mortgage but that
the period for redemption had lapsed. Was the
contract an equitable mortgage?
A: The contract was an equitable mortgage. There is
no conclusive test to determine whether a deed
absolute on its face is really a simple loan
accommodation secured by a mortgage. The
decisive factor in evaluating such deed is the
intention of the parties as shown by all the
surrounding circumstances. When in doubt, courts
are generally inclined to construe a transaction
purporting to be a sale as an equitable mortgage,
which involves a lesser transmission of rights and
interests over the property in controversy. The
nomenclature given by the parties to the contract is
not conclusive of its nature. In this case, the factual
findings of the RTC and CA regarding the equitable
mortgage attained finality as Z never challenged the
same.
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CIVIL LAW (AND PRACTICAL EXERCISES)
Q: Can X and Y still redeem the property?
Yes. An equitable mortgage was a mere accessory
contract to secure the fulfilment of the payment of the
loan. Because the transaction was not a sale with
right of repurchase, there is no redemption period to
speak of, merely the prescriptive period under Article
1144 of the Civil Code. Parties would have 10 years
from the time the cause of action accrued to file the
appropriate action. X and Y’s cause of action to
recover the subject property can only have accrued
in 2004, when Z rejected X and Y’s attempt to recover
the mortgaged property, and not in 1987, when the
contract was executed. Therefore, the filing of the
complaint in 2005 was made well within the 10-year
prescriptive period. (Saclolo v. Marquito, G.R. No.
229243, June 26. 2019)
Q: Can future property be the object of a
mortgage?
a) As a general rule, it cannot. (Dilag v. Heirs
of Resurreccion, G.R. No. 48941)
a. In order to bring future property
within the coverage of the
mortgage, the mortgagor must
execute a mortgage supplement
after the mortgagor acquires
ownership of the properties or after
those properties come into
existence. They must be registered
with the relevant Register of Deeds.
b) However, a stipulation subjecting to the
mortgage lien, improvements which the
mortgagor may subsequently acquire,
install, or use in connection with the real
property already mortgaged belonging to the
mortgagor is valid. (People’s Bank and Trust
Co. v. Dahican Lumber Co., G.R. No. L-
17500, 1967)
Q: What is a dragnet clause?
A: It is one which is specifically phrased to subsume
all debts of past or future origins. A mortgage which
provides a dragnet clause is in the nature of a
continuing guaranty and constitutes an exception
to the rule that an action to foreclose a mortgage
must be limited to the amount mentioned in the
mortgage contract. (PCSO vs. New Dagupan Metro
Gas Corp., G.R. No. 173171, 2012)
In the absence of clear and supportive evidence of a
contrary intention, a mortgage containing a dragnet
clause will not be extended to cover future advances,
unless the document evidencing the subsequent
advance refers to the mortgage as providing security
therefor.
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Q: What is the exent of the mortgage liability?
1. General Rule: a mortgage liability is usually
limited to the amount mentioned in the contract
2. However, the amounts named as consideration
in a contract of mortgage do not limit the amount
for which the mortgage may stand as security if
from the four corners of the instrument the intent
to secure future and other indebtedness can be
gathered. (Ramos vs. PNB, G.R. No. 178218,
2011)
Distinguish a dragnet clause from an
acceleration clause.
Dragnet Clause Acceleration Clause
It is a stipulation in a It is a stipulation stating
REM contract that that, on the occasion of
extends the coverage the mortgagor’s default
of a mortgage to in paying an installment
advances or loans of a debt, the whole sum
other than those that remains unpaid
already obtained or automatically
specified in the becomes due and
contract. A dragnet payable. (Luzon
clause may refer to Development Bank v.
past or future debts. Conquilla, 2005)
(Paradigm
Development Corp. of
the Philippines v. Bank
of the Philippine
Islands, 2017)
Q: What is the reliance on the security test?
A: It applies in a situation where there are several
obligations and several collaterals. When the
mortgagor takes another loan for which another
security was given, it could not be inferred that such
loan was made in reliance solely on the original
security with the "dragnet clause," but rather, on the
new security given. The "dragnet clause" in the first
security instrument constituted a continuing offer by
the borrower to secure further loans under the
security of the first security instrument, and that when
the lender accepted a different security he did not
accept the offer. (See Prudential Bank v. Alviar, G.R.
No. 150197, 2005)
Q: What is the effect of a Sale or transfer of the
mortgaged property?
A: It cannot affect or release the mortgage; thus, the
purchaser or transferee is necessarily bound to
acknowledge and respect the encumbrance. (Garcia
vs. Villar, G.R. No. 158891, 2012)
Q: Can the collateral be alienated during the
mortgage?
A: Yes. The law considers void any stipulation
forbidding the owner from alienating the
immovable mortgaged. (Art. 2130)
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CIVIL LAW (AND PRACTICAL EXERCISES)
Q: When does the right to file an action for
collection of debt or foreclosure accrue?
A: In order that the debtor may be in default, it is
necessary that:
a) the obligation be demandable and already
liquidated;
b) the debtor delays performance; and
c) the creditor requires the performance
judicially or extrajudicially (unless demand is
not necessary).
Q: Can the remedies be availed of
simultaneously?
A: The remedies of collection and foreclosure are
mutually exclusive, which means that the invocation
or grant of one remedy precludes the other. Both
demands for the payment of the debt and the
foreclosure of the mortgage arise from a single cause
of action. Though the debt and the mortgage
constitute separate agreements, the latter is
subsidiary to the former, and both refer to one and
the same obligation. Consequently, there exists only
one cause of action for a single breach of that
obligation. (Pineda v. De Vega, G.R. No. 233774,
2019)
Q: What is the prescriptive period to recover the
deficiency after foreclosure?
A: 10 years from the time the right of action accrues
(Arts.1142 & 1144)
Q: What is the rule with respect to the family
home?
A: The family home is exempt from execution, forced
sale or attachment, except for debts secured by
mortgages on the premises before or after such
constitution. (Art. 155, Family Code; Fortaleza vs.
Lapitan, G.R. No. 178288, 2012; Parcon-Song v
Parcon, G.R. No. 199582. July 7, 2020)
Q: Can the mortgagee recover the deficiency?
A: It is settled that if the proceeds of the sale are
insufficient to cover the debt in an extrajudicial
foreclosure of mortgage, the mortgagee is entitled to
claim the deficiency from the debtor. (BPI vs.
Avenido, G.R. No. 175816, 2011)
Q: What happens if the property is not
redeemed?
A: Consolidation of title becomes the right of
purchaser, who becomes entitled to possession
(Spouses Gatuslao v. Yanson, G.R. No. 191540,
2015)
Q: What is the effect of inadequacy of price in a
foreclosure sale?
1. Where there is Right to Redeem.
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1. General rule: Inadequacy of price is
immaterial because the judgment debtor
may redeem the property.
2. Exception: The price is so inadequate as
to shock the conscience of the court taking
into consideration the peculiar
circumstances. The sale will be set aside.
(Sulit vs. CA, G.R. No. 119247, 1997)
2. Property may be sold for less than its fair market
value upon the theory that the lesser the price the
easier for the owner to redeem.
Q: Can the creditor waive the security?
1. The Mortgagee may waive right to foreclose
his mortgage and maintain a personal action
for recovery of the indebtedness.
2. Remedies are alternative, not cumulative.
3. Options of the mortgagee in case the debtor-
mortgagor dies:
a. To waive mortgage and claim
entire debt from the mortgagor’s
estate as an ordinary claim;
b. To judicially foreclose mortgage
and prove any deficiency; or
c. To rely on the mortgage
exclusively without filing a claim
for deficiency
Q: What are the Kinds of Redemption?
1. Equity of redemption:
a. Applies to judicial foreclosure
b. A second mortgagee acquires only
the equity of redemption vested in
the mortgagor, and his rights are
strictly subordinate to the superior
lien of the first mortgagee.
2. Right of redemption:
a. Applies only to extrajudicial
foreclosure of real mortgage.
b. EXC: The right of redemption is
also available in judicial
foreclosure, in cases where the
mortgagee is a bank. (Section 47 of
RA 8791)
c. NOTE: The right of redemption, as
long as within the period
prescribed, may be exercised
irrespective of whether or not the
mortgagee has subsequently
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CIVIL LAW (AND PRACTICAL EXERCISES)
conveyed the property to some
other party (Sta. Ignacia Rural
Bank, Inc. v. CA, G.R. No. 97872,
1994)
Q: What is the Doctrine of Indivisibility of
Mortgage?
General Rule: Mortgage is indivisible.
Exceptions:
1. Where each one of several things guarantee
a determinate portion of credit.
2. Where only portion of loan was released.
a. Example: X borrowed 80k from the
bank and he mortgaged his 100 ha.
property. Lender was only able to
release 40k due to CB restrictions.
The Court held that the bank can
only foreclose on 50% of the
mortgaged land (50 hectares)
(Central Bank v. CA, G.R. No. L-
45710, 1985)
3. Where there was failure of consideration.
Q: Does the Doctrine of Indivisibility of Mortgage
still apply once the mortgage has been
extinguished by foreclosure?
A: The doctrine of indivisibility of mortgage does not
apply once the mortgage is extinguished by a
complete foreclosure thereof. Nothing in the law
prohibits the piecemeal redemption of properties sold
at one foreclosure proceedings. (Yap vs. Dy, Sr.,
G.R. Nos. 171868 & 171991, 2011).
Q: Does the placing of multiple mortgages in one
document make an indivisible whole? No
(PBCOM v. Macadaeg, 109 Phil. 981 (1960))
Q: How should redemption be performed?
A: The general rule in redemption is that it is not
sufficient that a person offering to redeem manifests
his desire to do so; The statement of intention must
be accompanied by an actual and simultaneous
tender of payment; In case of disagreement over the
redemption price, the redemptioner may preserve his
right of redemption through judicial action, which in
every case, must be file within the one-year period of
redemption. (Torbela vs. Rosario, G.R. Nos. 140528
& 140553, 2011)
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Q: What are the statutory periods of redemption?

PERIODS OF EXTRAJUDICIAL FORECLOSURE JUDICIAL FORECLOSURE

REDEMPTION (Act no. 3135)

Banks Non-Banks Banks Non-Banks

Individual 1 year from registration 1 year from registration 1 year from registration N/A [Equity of
debtors / of the certificate of sale of the certificate of sale of the certificate of sale Redemption
mortgagors with Registry of Deeds. with Registry of Deeds. with Registry of Deeds. Only]

Juridical 3 months after 1 year from registration 1 year from registration N/A [Equity of
persons as foreclosure or before of the certificate of sale of the certificate of sale Redemption
debtors / registration of with Registry of Deeds. with Registry of Deeds. Only]
mortgagors certificate of
foreclosure whichever
is earlier (General
Banking Law, Sec. 47)

second mortgage is extinguished, since the

Note: The right of legal redemption must be
exercised within specified time limits. However, the
statutory period of redemption can be extended by
agreement of the parties. (Republic vs. Marawi-
Marantao General Hospital, G.R. No. 158920, 2012)
Q: How do you determine the Redemption Price?
1. Mortgagee is not a bank (Act No. 3135 in
relation to Sec. 28, Rule 39 of Rules of Court)
1. Purchase price of the property;
2. 1% interest per month on the purchase
price;
3. Taxes paid and amount of purchaser’s
prior lien, if any, with the same rate of
interest computed from the date of
registration of sale, up to the time of
redemption.
2. Mortgagee is a bank (Section 47, General
Banking Act of 2000)
1. Amount due under the mortgage deed;
2. Interest at the rate specified in mortgage;
3. Cost and expenses incurred by bank from
sale and custody less income derived
Q: What are the rights of Junior Mortgagees?
 His remedy is limited to the right to redeem
by paying off the debt secured by the first
mortgage.
 He is entitled to the payment of his credit the
excess of the proceeds of the auction sale.
 In case the credit of the first mortgagee has
absorbed the entire proceeds of the sale, the
mortgage cannot be enforced beyond the
total value of the mortgaged property.
Q: What is the right of a purchaser at a
foreclosure sale?
A: The purchaser at the foreclosure sale is entitled
as of right to a writ of possession. The issuance of
the writ of possession in an extrajudicial foreclosure
is merely a ministerial function.
Q: What is the Doctrine of Mortgagee in Good
Faith?
A: Even if the mortgagor is not the owner of the
mortgaged property, the mortgage contract and any
foreclosure sale arising therefrom are given effect by
reason of public policy; the mortgagee in good faith
is entitled to protection. (Torbela vs. Rosario, G.R.
Nos. 140528 &140553, 2011)
When a mortgagee relies upon what appears on the
face of a Torrens title and lends money in all good
faith on the basis of the title in the name of the
mortgagor, only thereafter to learn that the latter’s
title was defective, being thus an innocent
mortgagee for value, his or her right or lien upon the
land mortgaged must be respected and protected.
(Mahinay vs. Gako, Jr., G.R. Nos. 165338 & 179375,
2011)
In order for a mortgagee to invoke the doctrine of
mortgagee in good faith, the impostor must have
succeeded in obtaining a Torrens title in his name

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and thereafter in mortgaging the property. Where the
mortgagor is an impostor who only pretended to be
the registered owner, and acting on such pretense,
mortgaged the property to another, the mortgagor
evidently did not succeed in having the property titled
in his or her name, and the mortgagee cannot rely on
such pretense as what appears on the title is not the
impostor's name but that of the registered owner.
(Ruiz v. Dimailig, G.R. No. 204280, 2016)
Q: What does the higher degree of diligence for
banks entail?
 A bank cannot assume that, simply because
the title offered as security is on its face free
of any encumbrances of lien, it is relieved of
the responsibility of taking further steps to
verify the title and inspect the properties to
be mortgaged.
 BUT: A bank should not necessarily be
made liable if it did not investigate or inspect
the property. If the circumstances reveal that
an investigation would still not yield a
discovery of any anomaly, or anything that
would arouse suspicion, the bank should not
be liable. Such is the case when the TCT is
clean, bearing no annotations evidencing
any trust, lien, or encumbrance on the
property, not forged or fake. There is also no
showing that the bank was aware of any
defect or any other conflicting right on the
title when the property was mortgaged to it.
In fact, the investigation of the property
would still fail to bring any doubt as to the
validity of the TCT (i.e., the title owners were
in actual possession of the property).
(Parcon-Song v Parcon, G.R. No. 199582.
July 7, 2020)
Q: Can a person mortgage conjugal property
without the consent of his or her spouse?
A: Real estate mortgage over a conjugal property is
void if the non-contracting spouse did not give
consent (PNB v. Venancio Reyes, Jr., G.R. No.
212483, 2016)
Q: What are the rights of the Creditor where the
Debtor fails to comply with his obligation?
A:
1. Creditor is merely entitled to move for the sale
of the thing mortgaged with the formalities
required by law in order to collect.
2. Creditor cannot appropriate to himself the thing
nor can he dispose of the same as owner.
Q: What are the requisites of Pactum
Commissorium?
1. There should be a mortgage; and
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CIVIL LAW (AND PRACTICAL EXERCISES)
2. There should be a stipulation for an
automatic appropriation by the creditor of
the property in the event of
nonpayment.(Pen v. Julian, G.R. No.
160208, January 11, 2016)
Q: What is the effect of Pactum Commissorium?
A: Stipulation is null and void, but principal contract
is still valid.
The essence of pactum commissorium is that
ownership of the security will pass to the creditor by
the mere default of the debtor. (Spouses Solitarios v.
Spouses Jaque, G.R. No. 199852, 2014)
-------- end of topic --------
III. LAND TITLES & DEEDS
.
A. TORRENS SYSTEM; GENERAL
PRINCIPLES
Q: What is Torrens System?
A: The Torrens system of land registration is a
system for the registration of title to land only, and not
a system established for the acquisition of land.
(Roxas v. Enriquez, G.R. No. L-8539, 1914).
The Government is required under the Torrens
system of registration to issue an official certificate of
title to attest to the fact that the person named in the
certificate is the owner of the property therein
described, subject to such liens and encumbrances
as thereon noted or what the law warrants or
reserves. Yet, registration under the Torrens system
does not create or vest title. The Torrens certificate
of title is merely an evidence of ownership or title in
the particular property described therein (Casimiro
Development Corporation vs. Mateo, G.R. No.
175485, July 27, 2011)
Q: What is the purpose of Torrens System?
A: The main purpose of the Torrens system is to
avoid possible conflicts of title to real estate and to
facilitate transactions relative thereto by giving the
public the right to rely upon the face of a Torrens
certificate of title and to dispense with the need of
inquiring further, except when the party concerned
has actual knowledge of facts and circumstances that
should impel a reasonably cautious man to make
such further inquiry (Sps. Peralta v. Heirs of Abaion,
G.R. No. 183448, 2014).
Q: X's predecessors-in-interest had been in open,
peaceful, exclusive, and uninterrupted
possession and occupation in the concept of
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owners of a land even before 1945. The land was
classified and declared alienable and disposable
in 2001. Y filed his petition for registration of title
in 2016. The OSG opposed saying that less than
30 years have elapsed from the declaration of the
land's alienability and disposability in 2001 to the
filing of the petition in 2016. Is the OSG correct?
A: No. Section 14(1) of the Property Registration
Decree should be interpreted to include possession
before the declaration of the land's alienability as long
as at the time of the application for registration, the
land has already been declared part of the alienable
and disposable agricultural public land (Heirs of
Malabanan v. Republic, G.R. No. 179987, 2013;
Republic v. Roasa, G.R. No. 176022, 2015).
Q: X is the registered owner named In the Torrens
certificate of title over a parcel of land. Y has
registered interest, lien or encumbrance
annotated on the additional sheet of the said
certificate of title of X. In case that additional
sheet is destroyed or missing, may Y file a
petition for reconstitution of the certificate of title
of X?
A: Yes. Under Sec. 11 of R.A. No. 26, a petition for
reconstitution of registered interests, liens and other
encumbrances may be filed when the certificate of
title affected has not been totally destroyed, that is,
when the certificate of title is composed of more than
one sheet and only the portion of the additional sheet,
on which such interest, lien or encumbrance was
noted is missing. (Ungay Malobago v. Republic, G.R.
No. 187892, 2015)
B. REGALIAN DOCTRINE
Q: What is the Regalian Doctrine?
A: Under the Regalian doctrine, all lands of the public
domain belong to the State, which is the source of
any asserted right to ownership of land. All lands of
the public domain, waters, minerals, coal, petroleum
and other mineral oils, all forces of potential energy,
fisheries, forests, or timber, wildlife, flora and fauna,
and natural resources belong to the state. With the
exception of agricultural lands, all other natural
resources shall not be alienated. (Sec. 2, Article XII,
1987 Constitution)
"Under the Regalian doctrine embodied in our
Constitution, land that has not been acquired from
the government, either by purchase, grant, or any
other mode recognized by law, belongs to the State
as part of the public domain."(Republic v. Jaralve,
G.R. No. 175177, Oct. 24, 2012 citing Republic v.
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CIVIL LAW (AND PRACTICAL EXERCISES)
Heirs of Juan Fabio, G.R. No. 159589, Dec. 23,
2008)
Q: What are the classifications of Public Domain?
Who classifies them?
A: Under the Constitution, these are:
1. Agricultural;
2. Forest or timber;
3. Mineral lands; and
4. National parks. (Sec. 3, Art. XII, 1987
Constitution)
The classification of public lands is an exclusive
prerogative of the Executive Department and not of
the courts. In the absence of such classification, the
land remains as unclassified land until it is released
therefrom and rendered open to disposition. (Dir. Of
Lands v. CA, 129 SCRA 689, 1984)
Q: What is a Native Title?
A: Native title refers to pre-conquest rights to lands
and domains which, as far back as memory reaches,
have been held under a claim of private ownership by
Indigenous Cultural Communities/Indigenous
Peoples (ICCs/IPs), have never been public lands
and are thus indisputably presumed to have been
held that way since before the Spanish Conquest.
(Sec. 3(L), Ch. III, R.A. 8371)
NOTE: The Regalian Doctrine does not negate
native title.
Q: What is the significance of the Regalian
Doctrine in original land registration?
A: To overcome the presumption that land sought to
be registered forms part of the public domain,
incontrovertible evidence must be established that
the land subject of the application is alienable or
disposable. A positive act of the government is
needed to declassify land which is classified as forest
and convert it into alienable and disposable land for
agricultural or other purposes. (Yu Chang v.
Republic, G.R. No. 171726, 2011)
C. ORIGINAL REGISTRATION
Q: What is an Original Certificate of Title (OCT)?
A: An Original Certificate of Title (OCT) is the first title
issued in the name of the registered owner by virtue
of judicial/voluntary or administrative/involuntary
proceedings (Salao, et al. v Salao, G.R. No. L-26699,
1978).
Q: What are the effects when an OCT is placed
under the Torrens System?
1. A Title becomes indefeasible and imprescriptible
(Collado v. CA, G.R. No. 107764, 2002);
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2. Every decree or certificate of title issued shall be
incontrovertible (Director of Lands v. Register of
Deeds, G.R. No. L-4463. 1953);
3. Certificate is no longer subject to collateral attack
(Ong, et. a! v. Sps. Cabucos, G.R. No. 142056,
2001).
4. Relieved from all claims, except those noted
thereon: (LiT-Wti)
a. Liens, claims or rights arising or existing
under the laws and Constitution, which
are not by law required to appear of
record in the Registry of Deeds in order
to be valid against subsequent
purchasers or encumbrancers of record;
b. Unpaid real estate Taxes levied and
assessed within two (2) years
immediately preceding the acquisition of
any right over the land by an innocent
purchaser for value, without prejudice to
the right of the government to collect
taxes payable before that period from
the delinquent taxpayer alone;
c. Any public highway or private Way
established or recognized by law, or any
government irrigation canal or lateral, if
the certificate of title does not state that
their boundaries have been determined.
d. Any disposition of the property or
limitation on the Use thereof by virtue of,
or pursuant to, Presidential Decree No.
27 or any other law or regulations on
agrarian reform (P.D. 1529, Sec. 44).
Q: Who may apply for ordinary registration of title
to land?
1. Those who by themselves or through their
predecessors-in-interest have been in open,
continuous, exclusive, notorious possession and
occupation of alienable and disposable lands of
the public domain under a bona fide claim of
ownership for at least 20 years immediately
preceding the filing of the application for
confirmation of title except when prevented by
war or force majeure. They shall be conclusively
presumed to have performed all the conditions
essential to a Government grant and shall be
entitled to a Government grant and shall be
entitled to a certificate of title.
2. Those who acquired ownership of private lands
or abandoned riverbeds by right of accession or
accretion under the existing laws
3. Those who have acquired ownership of land in
any manner provided for by Law (PD 1529, § 14,
as amended by RA 115731)
Q: What are the limitations to ownership of land
by individuals? By corporations?
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CIVIL LAW (AND PRACTICAL EXERCISES)
A: Only Filipino citizens may acquire land not more
than 12 hectares and may lease not more than 500
hectares of alienable lands of the public domain.
Foreign and Filipino corporations (corporations at
least 60% of whose capital is owned by Filipino
citizens) may only lease alienable land of the public
domain not exceeding 1,000 hectares, for 25 years
and renewable for not more than 25 years (Sec. 3,
Art. XII, 1987 Constitution). Private lands may be
transferred or conveyed only to individuals,
corporations, or associations qualified to acquire or
hold lands of the public domain (Sec. 7, Art. XII, 1987
Constitution).
Exceptions:
When the land has been previously acquired by
prescription by a natural person (and thus already
private land) and subsequently transferred to a
juridical entity, the constitutional prohibition against
acquisitions by a private corporation would not apply.
In this case, a corporation may apply for judicial
confirmation of title (Dir. of Lands v. MC and ACME,
G.R. No. 73002, 1986).
In cases of hereditary succession, private lands
may be transferred or conveyed to aliens,
corporations, or associations not qualified to acquire
or hold lands of the public domain (Sec. 7, Art. XII,
1987 Constitution)
Q: What must an applicant in land registration
proceedings prove and submit as evidence
therefor?
1. Alienability and disposability of land
a. CENRO/PENRO Certification
and
b. Copy of the original classification
2. Identity of land (Survey plan, technical
description of the land, tax declarations)
3. Private ownership
a. Tax declarations (NOTE: not conclusive
evidence of ownership; must be coupled
with proof of actual possession)
b. Presidential issuances and legislative
acts
c. Other kinds of proof (e.g., testimonial
evidence, photos of improvements
introduced)
4. Open, exclusive, continuous, and peaceful
possession in the concept of owner
a. Tax declaration
b. Regular realty tax payments
c. Muniments of title (e.g., deeds of sale,
wills, donation; to tack possession to
that of predecessors-in-interest)
d. Other kinds of proof (e.g., testimonial
evidence, photos of improvements
introduced)
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The payment of realty taxes and declaration of the
subject land in the name of the applicant for a certain
year gives rise to the presumption that he claimed
ownership and possession thereof only in that year.
(Republic v. Science Park of the Philippines, G.R.
No. 237714, Nov. 12, 2018)
Q: How must the alienability and disposability of
the subject land be proven?
A: Applicant must submit BOTH these requirements:
1. Certification from City Environment and Natural
Resources Office (CENRO) or Provincial
Environment and Natural Resources Office
(PENRO)
a. If land is less than 50 hectares —
CENRO Certification
b. If land is 50 hectares or more —PENRO
Certification; and
2. Copy of the original classification of land as
alienable and disposable approved by the
DENR Secretary and certified as a true copy by
the legal custodia* of the official records.
(Republic of the Philippines v. Santos, G.R. No.
191516, June 4, 2014)
A surveyor-geodetic engineer's notation indicating
that "the survey was inside alienable and disposable
land" is not enough to prove that the land subject of
an application for registration is alienable and
disposable (Republic vs. De Guzman Vda. de Joson.
G.R. No. 163767, Mar. 10, 2014).
Q: Is City Environment and Natural Resources
Office (CENRO) or Provincial Environment and
Natural Resources Office (PENRO) Certification
enough to certify or prove that the land subject of
an application for registration is alienable and
disposable?
A: No. PENRO or CENRO is not enough to certify
that a land is alienable and disposable. The applicant
must prove that the DENR Secretary had approved
the land classification and released the land of the
public domain as alienable and disposable, and that
the land subject of the application for registration falls
within the approved area per verification through
survey by the PENRO or CENRO.
In addition, the applicant for land registration must
present a copy of the original classification approved
by the DENR Secretary and certified as a true copy
by the legal custodian of the official records.
(Remman Enterprises, Inc. v. Republic, G.R. No.
188494, 2014)
Q: Is a surveyor-geodetic engineer's notation
indicating that "the survey was inside alienable
and disposable land" enough to prove that the
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CIVIL LAW (AND PRACTICAL EXERCISES)
land subject of an application for registration is
alienable and disposable?
A: No. The law requires that the applicant prove that:
(1) the land formed part of the alienable and
disposable land of the public domain; and (2) she, by
herself or through her predecessors-in-interest, had
been in open, continuous, exclusive, and notorious
possession and occupation of the subject land under
a bona fide of ownership for at least 20 years
immediately preceding the filing of the application for
confirmation of title.
Unless public land is shown to have been reclassified
or alienated to a private person by the State, it
remains part of the inalienable public domain.
"Occupation thereof in the concept of owner, no
matter how long, cannot ripen into ownership and be
registered as a title." To overcome such presumption,
incontrovertible evidence must be shown by the
applicant. Notation in a geodetic survey does not
constitute a positive government act validly changing
the classification of the land in question. A surveyor
has no authority to reclassify lands of the public
domain.
Land of the public domain, to be the subject of
appropriation, must be declared alienable and
disposable either by the President or the Secretary of
the DENR. The applicant for land registration has the
burden of overcoming the presumption of State
ownership by establishing through incontrovertible
evidence that the land sought to be registered is
alienable or disposable based on a positive act of the
government (Republic vs. De Guzman Vda. de
Josori, G.R. No. 163767, Mar. 10, 2014).
Q: What is the procedure in ordinary land
registration proceedings under P.D. 1529 and
C.A. 141?
1. Survey of land; survey plan must be duly
approved by the Director of Lands
2. Filing of application for registration by the applicant
together with all muniments of title and the
approved survey plan
3. Setting of the date of the initial hearing of the
application which shall be held 45-90 days from the
date of order
4. Transmittal of application and documents
by the Clerk of Court to the LRA
5. Publication of notice of initial hearing
(mandatory)
a. Once in the Official Gazette
b. Once in a newspaper of general
circulation
6. Mailing and posting of notice of initial hearing
7. Filing of answer or opposition to the application
by any person
8. Hearing of the case by the court
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9. Promulgation of judgment
10. issuance of the order of finality of judgment
11. Entry of the decree of registration in the LRA
12. Sending of the original and owner's
dup licate OC T to the R OD of the
city/province where the property is situated
13. E ntry of OC T by t he R OD i n t he
Electronic Primary E ntry Book for
Registered Land and delivery of owner's duplicate
OCT to the applicant upon payment of the
prescribed fees.
Q: Can an applicant for original registration
engage in dealings over said land during the
pendency of the registration proceedings?
A: Yes. After the filing of the application and before
the issuance of the decree of registration, the land
therein described may still be the subject of dealings
in whole or in part, in which case the interested party
shall present to the court the pertinent instruments
together with a subdivision plan approved by the
Director of Lands in case of transfer of portions
thereof and the court, after notice to the parties, shall
order such land registered subject to the conveyance
or encumbrance created by said instruments, or
order that the decree of registration be issued in the
name of the person to whom the property has been
conveyed by said instruments. (Sec. 22, P.D. 1529)
Q: What is the decree of registration and what is
the effect of its entry in the LRA?
A: It is the decree issued by the LRA pursuant to the
order of the court (Sec. 31, P.D. 1529). One year after
the date of entry of decree, it becomes
incontrovertible and amendments will not be allowed
except for correcting clerical errors. It is deemed
conclusive upon and against all persons, whether or
not mentioned by name in the application or notice.
Q: What is the consequence if it is shown that the
decree of registration had included lands not
included in the original application as published?
A: The registration proceedings are null and void
insofar as the land not included in the publication is
concerned. (Benin v.Tuason, G.R. No. L26127, June
28, 1974)
Q: What remedy can be availed of in cases of
actual fraud committed in the adjudication or
confirmation of title? What are the requisites to
avail of the same?
A: A petition for review of the decree of
registration may be filed by any aggrieved party,
including persons deprived of the opportunity to be
heard, including the government. Such party does
not need to be an oppositor or original claimant in the
proceedings (Sec. 32, P.D. 1529). This remedy,
however, is not available to an oppositor who
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CIVIL LAW (AND PRACTICAL EXERCISES)
abandoned his claim and oppositor who had notice
of the proceedings but failed to raise his claims
(Crisolo v. CA, G.R. No. L-33093, 1975).
Requisites: (InFA-ReD)
1. The property has not yet passed to an Innocent
purchaser for value;
2. Petition is Filed within 1 year from entry of the
decree;
3. A There was Actual or extrinsic fraud;
4. Petitioner has a Real and dominical right;
5. He was Deprived thereof; (Walstrom v. Mapa,
181 SCRA 431, 1990)
Q: What are the other grounds for a review of the
decree of registration?
A:
1. Fatal infirmity of the decision for want of due
process
2. Lack of jurisdiction of the court
Q: When can a forged deed be a source of a valid
title?
A: A forged or fraudulent document may become the
root of a valid title as when the certificate of title over
the land has already been transferred from the name
of the owner to that of the forger and the land is sold
later to an innocent purchaser for value. This doctrine
serves to emphasize that a person who deals with
registered property in good faith will acquire good title
from a forger and be absolutely protected by a
Torrens title (Sps. ViIlamil v. Velasco, G.R. No.
177187, 2009).
Q: Who is an "innocent purchaser for value"?
A: One who buys property of another, without notice
that some other person has a right to or interest in
such property and pays a full and fair price for the
same, at the time of such purchase or before he has
notice of the claims or interest of some other person
in the property One claiming to be an innocent
purchaser for value has the burden of proving such
status (Sps. Villamil v. Villarosa, G.R. No. 177187,
2009).
The same includes an innocent lessee, mortgagee,
or other encumbrancer for value (P.D. 1529, Sec.
32).
One is considered a buyer in bad faith not only when
he purchases real estate with knowledge of a defect
or lack of title in his seller but also when he has
knowledge of facts which should have alerted him to
conduct further inquiry or investigation. (Krystle
Realty Development Corp. v. Alibin, G.R. Nos.
196117 & G.R. No. 196129, 2014)
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One asserting the status of a buyer in good faith and
for value, it had the burden of proving such status,
which goes beyond a mere invocation of the ordinary
presumption of good faith. (Krystle, G.R. Nos.
196117 & G.R. No. 196129, 2014)
Where the land sold is in the possession of a person
other than the vendor, the purchaser must go beyond
the certificate of title and make inquiries concerning
the actual possessor. (Magsano v. Pangasinan
Savings and Loan Bank, Inc., G.R. No. 215038,
2016)
Q: What is the difference between actual or
extrinsic fraud and intrinsic fraud?
EXTRINSIC INTRINSIC
Refers to a fraud Refers to the acts of a
committed to party at a trial that
the unsuccessful party prevented a fair and just
by his opponent, determination of the
preventing him from case, but the difference
fully exhibiting his case is that the acts or things,
by keeping him away like falsification and
from court, a false false testimony, could
promise of a have been litigated and
compromise; or where determined at the trial or
the defendant never adjudication of the case.
had knowledge of the (Pinausukan Seafood
suit, being kept in House v. Far East Bank
ignorance by the acts & Trust Co., G.R. No.
of the plaintiff; or when 159926, 2014)
an attorney
fraudulently or without
authority connives at
his defeat. (Baclaran
Marketing Corp. v.
Nieva, G.R. No.
189881, 2017)
Q: Is republication required if the land subject of
a petition for registration of title was reduced in
area due to a discrepancy in the technical
description?
A: No. Amendments in a petition that do not involve
an addition but only a reduction of the original area
that was published no longer require a republication
because the amended area was already included in
the first publication (Republic v. San Mateo, et al.,
G.R. No. 20356, 2014).
Q: What is the difference between a direct attack
from a collateral attack on title?
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CIVIL LAW (AND PRACTICAL EXERCISES)
DIRECT INDIRECT
When the object of an when, in an action to
action is to annul or obtain a different
set aside such relief, an attack on the
judgment or enjoin its judgment or
enforcement. proceeding is
nevertheless made as
an incident thereof.
(Sampaco v. Lantud, G.R. No. 163551, 2011).
D. CETRIFICATE OF TITLE
Q: What is a Torrens Title?
A: A Torrens Title is a certificate of ownership issued
under the Torrens System, through the ROD, naming
and declaring the owner of the real property
described therein, free from all liens and
encumbrances, except such as may be expressly
noted therein or otherwise reserved by law. (P.D.
1529, § 44)
NOTE: A title once registered cannot be impugned,
altered, changed, modified, enlarged, or diminished
except in a direct proceeding permitted by law,
usually for the protection of innocent third persons.
Q: What are the attributes Torrens Certificate of
Title? (FINIP)
1. Free from liens and encumbrances
Exceptions: (C-U-PAL)
a. Those noted on the Certificate
b. Unpaid real estate taxes levied and
assessed within 2 years immediately
preceding the acquisition of any right over
the land by an innocent purchaser for value
c. Any Public highway, or private way
established or recognized by law, or any
government irrigation, canal or lateral
thereof, if the certificate of title does not state
the boundaries of such highway or irrigation
canal or lateral thereof has been
determined
d. Any disposition of the property or limitation
on the issue thereof pursuant to PD 27 or
any other laws or regulations on Agrarian
reform
e. Liens, claims, or rights arising or existing
under the Laws and the Constitution, which
are not by law required to appear on record
in the Register of Deeds in order to be valid.
2. Incontrovertible and indefeasible
Exceptions: (PUF)
a. If Previous valid title of the same land exists
b. When land covered is Unregistrable
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c. When acquisition of certificate is attended by

Fraud E. SUBSEQUENT REGISTRATION
3. Not subject to collateral attack 1. VOLUNTRARY DEALINGS
A It cannot be altered, modified, or cancelled
except in a direct proceeding in accordance with
Q: Generally, what is the process of registering
the law. An action is an attack on a title when the
voluntary dealings?
object of the action is to nullify the title, and thus
1. Execution of instrument in a form sufficient in law.
challenge the judgment or proceeding pursuant
It must contain the names, nationalities,
to which the title was decreed.
residence, and postal address of the grantees or
others acquiring an interest under the
4. Imprescriptible
instrument. (Sec. 55, P.D. 1529)
No title to registered land in derogation of that of
2. Presentation of the following to the ROD:
the registered owner shall be acquired through
a. Owner's duplicate certificate
prescription.
b. Instrument
3. Payment of registration fee and documentary
5. Presumed valid and devoid of flaws
stamp taxes
A Torrens certificate is presumed to have been
4. The ROD makes and signs a memorandum on
regularly issued, valid, and without defects; a
the certificate of title
buyer has the right to rely upon the face of the
5. The ROD issues a Transfer Certificate of Title (if
same and to dispense with the trouble of inquiring
the instrument involves a transfer of the title to
further
the land)
Exception: When he has actual knowledge of
Q: What are the instances when the ROD may
facts and circumstances that would impel a
validly deny registration of a voluntary
reasonably cautious man to make inquiry.
instrument?
1. Where there is more than 1 copy of the owner's
NOTE: The prohibition against collateral attack does
duplicate certificate of title and not all such copies
not apply to spurious or non-existent titles, which are
are presented to the ROD.;
not accorded indefeasibility (Bangis v. Heirs of
2. Where the voluntary instrument bears on its face
Adolfo, G.R. No. 190875, 2012)
an infirmity (e.g., where the property is presumed
to be conjugal but the instrument of conveyance
The mere issuance of the certificate of title in the
bears the signature of only one spouse);
name of any person does not foreclose the possibility
3. Where the validity of the instrument sought to be
that the real property may be under co-ownership
registered is in issue in a pending court suit,
with - persons not named in the certificate or that the
notice of which must be given to parties;
registrant may only be a trustee or that other parties
4. Where required certificates or documents such
may have acquired interest subsequent to the
as DAR clearance, copy of latest tax declaration,
issuance of the certificate of title. (Go v. Estate of De
are not submitted. (Balbin v. ROD. G.R. No. L-
Buenaventura, G.R. Nos. 211972 & 212045, 2015)
20611, 1969)
5. The ROD may also refuse to register a private
Q: Does a certificate of title confer ownership
document since Section 112 of P.D. 1529
over the property described therein?
provided that deeds of conveyances affecting
A: No. Registration under the Torrens system, not
lands should be verified and acknowledged
being a mode of acquiring ownership, does not
before a notary public or other public officer
create or vest title. The Torrens certificate of title is
authorized by law to take
merely an evidence of ownership or title in the
acknowledgement. (Gallardo v. IAC, G.R. No. L-
particular property described therein. (Casimiro
67742, 1987)
Development Corporation vs. Mateo, G.R. No.
175485, July 27, 2011)
Q: What is the "Mirror Doctrine"?
A: A person dealing with registered land may rely on
Q: What is the rule where two transfer certificates
the correctness of the certificate of title issued and
of title have been issued on different dates?
the law will in no way obiige him to go beyond the
A: The one who holds the earlier title prevails. This
certificate to determine the condition of the property.
rule, however, may apply only in the absence of any
Where there is nothing ;n the certificate to indicate
anomaly or irregularity in the process of its
any cloud or vice in the ownership of the property, or
registration. (Bangis v. Heirs of Adolfo, G.R. No.
any encumbrance thereon, the purchaser is not
190875, 2012)
required to explore further than what the Torrens Title

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indicates upon its face in a quest for hidden defects
or inchoate right that may subsequently defeat his
right. (Locsin v. Hizon, G.R. No. 204369, 2014).
Q: What are the exceptions to the "Mirror
Doctrine"? (BOB-MILKA)
1. Where the purchaser or mortgagee is a Bank or
financing institution (Dela Merced v. GSIS, G.R.
No. 140398, 2001).
2. Where the Owner still holds a valid and existing
certificate of title covering the same property
because the law protects the lawful holder of a
registered title over the transfer of a vendor bereft
of any transmissible right. (Tomas v. Tomas,
G.R. No. L-36897, 1980).
3. Where the purchaser is in Bad faith (Egao v. CA,
G.R. No. L-79787, 1989).
4. Where a person buys land not from the registered
owner but from one whose rights to the land has
been Merely annotated on the certificate of title
(Quiniano v. CA, G.R. No. L23024, 1971).
5. Where there are sufficiently strong Indications to
impel closer inquiry into the location,
boundaries, and condition of the lot (Francisco v.
CA, G.R. No. L-30112, 1987).
6. Purchases land with a certificate of title
containing a notice of Lis pendens
7. Purchaser had full Knowledge of flaws and
defects of the title (Bemales v. MC, G.R. Nos.
71490-91, 1988).
8. When the purchaser buys from an Agent and not
from the registered owner
Q: Does the Mirror Doctrine apply when buying
from a person who is not the registered owner,
e.g. one authorized by an SPA?
A: No. The general rule is that every person
dealing with registered land may safely rely on the
correctness of the certificate of title issued therefor
and the law will in no way oblige him to go beyond
the certificate to determine the condition of the
property. However, a higher degree of prudence is
required from one who buys from a person who is not
the registered owner, although the land object of the
transaction is registered. In such a case, the buyer is
expected to examine not only the certificate of title
but all factual circumstances necessary for him to
determine if there are any flaws in the title of the
transferor. (Heirs of Sarili v. Lagrosa, G.R. No.
193517, 2014)
Q: What is the Chain of Title rule?
A: The general rule is that a forged deed is null and
cannot convey title. However, an exception is when
title is acquired from a forger to an innocent
purchaser for value (Sec. 55, Land Registration Act).
However, there must be a complete chain of
registered titles; all the transfers starting from the
BACK TO TOP
CIVIL LAW (AND PRACTICAL EXERCISES)
original rightful owner to the innocent holder for
value, including the transfer to the forger, must be
duly registered, and the title must be properly issued
to the transferee. (Spouses Peralta v. Heirs of
Bemardina Abalon, G.R. No. 183448, June 30, 2014)
Although generally a forged or fraudulent deed or
document is a nullity and conveys no title, it may
become the root of a valid title when the certificate of
title over the land has already been transferred from
the name of the owner to that of the forger and the
land is sold later to an innocent purchaser for value.
A person who deals with registered property in good
faith will acquire good title from a forger and will be
absolutely protected by a Torrens title (Sps. Villamil
v. Velasco, 2009).
While, it is a familiar doctrine that a forged or
fraudulent document may become the root of a valid
title, if title to the property has been transferred from
the forger to an innocent purchaser in good faith, the
same does not apply in case of banking institutions
or those engaged in real estate for they are expected
to exercise more care and prudence than private
individuals in their dealing with registered lands. In
the absence of inquiry, the respondent Bank cannot
and should not be regarded as a
mortgagee/purchaser in good faith. (Erasusta v. CA,
G.R. No. 149231, 2006)
Q: Can a forged deed be a source of a valid title?
A: Yes. As a general rule, after the entry of the
registration decree on the original application, any
subsequent registration procured by the presentation
of a forged duplicate certificate of title, or a forged
deed or other instrument is void (Sec. 53, P.D. 1529)
The exception states that a forged or fraudulent
document may become the root of a valid title when
the certificate of title over the land has already been
transferred from the name of the owner to that of the
forger, and the land is sold later to an innocent
purchaser for value. (Sps. Villamil v. Velasco, G.R.
No. 177187, 2009).
2. INVOLUNTARY DEALINGS
Q: What is an adverse claim?
A: An adverse claim is a notice to third persons that
someone is claiming an interest on the property or
has a better right than the registered owner thereof.
The disputed land is subject to the outcome of the
dispute (Sajonas v. CA, G.R Nc. 102377, 1996).
Q: What are the purposes of an adverse claim?
1. A It apprises third persons of the controversy
over the ownership of the land
2. It preserves and protects the right of the adverse
claimant during the pendency of the controversy
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3. It is notice to third persons that any transaction
regarding the disputed land is subject to the
outcome of the dispute. (Arrazola v. Bernas, 86
SCRA 279, 1978)
Q: What are the substantive requisites of an
adverse claim?
1. A claimant's right or interest in the registered land
is adverse to the registered owner;
2. Such right arose subsequent to date of original
registration;
3. No other provision is made in the Decree for the
registration of such right or claim (Sec. 70, P.D.
1529)
Q: What are the formal requisites to register an
adverse claim?
A: The following are the formal requisites to register
an adverse claim. Noncompliance with these
requisites renders the adverse claim non-registrable
and ineffective: (WNR)
1. Adverse claimant must state the following in
'Writing:
a. His alleged right or interest How and under
whom such alleged right or interest is
acquired
b. The description of the land in which the right
or interest is claimed
c. The certificate of title number
2. Such statement must be signed and sworn to
before a Notary public or authorized officer to
administer oath
3. Claimant shall state his Residence or place to
which all notices may be served upon him
Q: What is the period of effectivity of an
annotation of adverse claim?
A: The adverse claim shall be effective for a period
of 30 days from the date of registration.
Q: When can an adverse claim be cancelled?
A: It may be cancelled:
1. After the lapse of 30 days, upon the filing by the
party-in-interest of a verified petition for such
purpose
2. Before the lapse of said 30 days, upon the filing
by the claimant of a sworn petition withdrawing
his adverse claim
3. Before the lapse of the 30-day period, when a
party-in-interest files a petition in the proper RTC for
the cancellation of the adverse claim and, after
notice and hearing, the court finds that the claim is
invalid.
After cancellation, no second adverse claim based on the
same ground shall be registered by the same claimant.
(Sec. 70, P.D. 1529)
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CIVIL LAW (AND PRACTICAL EXERCISES)
Q: Can a pending conditional sale be registered
as an adverse claim?
A: No, it must be registered as a voluntary
instrument.
An adverse claim is an involuntary dealing designed
to protect the interest of a person over a piece of real
property by apprising third persons that there is a
controversy over the ownership of the land. It seeks
to preserve and protect the right of the adverse
claimant during the pendency of the controversy,
where registration of such interest or right is not
otherwise provided for by the Property Registration
Decree. It serves as a notice to third persons that any
transaction regarding the disputed land is subject to
the outcome of the dispute.
Before a notice of adverse claim is registered, it must
be shown that there is no other provision in law for
the registration of the claimant's alleged right in the
property. A conditional sale is essentially a dealing
affecting less than the ownership of the subject
property that is governed by Section 54 of PD 1529,
which requires that such dealings must be registered
through a brief memorandum on the certificate of title
and not through an adverse claim.
Moreover, a conditional sale is a voluntary
instrument. The rule is that voluntary instruments are
registered by presenting the owner's duplicate copy
of the title for annotation, pursuant to Sections 51 to
53 of PD 1529. The reason for requiring the
production of the owner's duplicate certificate in the
registration of a voluntary instrument is that, being a
willful act of the registered owner, it is to be presumed
that he is interested in registering the instrument and
would willingly surrender, present or produce his
duplicate certificate of title to the ROD in order to
accomplish such registration. The exception to this
rule is when the registered owner refuses or fails to
surrender his duplicate copy of the title, in which case
the claimant may file with the Register of Deeds a
statement setting forth his adverse claim.
Thus, a conditional sale, a voluntary instrument, must
be registered as such and not as an adverse claim.
(Logarta v. Mangahis, G P No 213568, July 5, 2016)
Q: What is notice of lis pendens?
A: A notice of lis pendens is an announcement to the
whole world that a particular real property is in
litigation, serving as a warning that one who acquires
an interest over said property does so at his own risk,
or that he gambles on the result of the litigation over
the said property (Spouses Po Lam v. Court of
Appeals, G.R. No 116220, (2000).
No action to recover possession of real estate, or to
quiet title thereto, or to remove clouds upon the title
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thereof, or for partition, or other proceedings of any
kind in court directly affecting the title to land or the
use or occupation thereof or the buildings thereon,
and no judgment, and no proceeding to vacate or
reverse any judgment, shall have any effect upon
registered land as against persons other than the
parties thereto, UNLESS a memorandum or notice
shall have been filed and registered, stating the
following:
1. Institution of such action or proceeding
2. The court wherein the same is pending
3. The date of the institution thereof
4. A reference to the number of the certificate of title
5. An adequate description of the land affected and
the registered owner thereof (P.D. 1529, Sec.
76).
Q: X, in disputing the sale of a certain piece land
by Y to Z, filed with the Register of Deeds a notice
of lis pendens on the back of the TCT. During the
pendency of the case, Z sold the land further to
W. Upon discovery, X sought to annul the
subsequent sale to W, but W countered that he
should be considered an innocent purchaser for
value.
A: No. The annotation of lis pendens served as
notice to them that the said lot is involved in a
pending litigation. Settled is the rule that one who
deals with property subject of a notice of lis pendens
cannot invoke the right of a purchaser in good faith.
Neither can he acquire better rights than those of his
predecessor in interest. (Sps. Po Lam v. CA, G.R.
No. 116220, Dec. 6, 2000).
Q: When can one cancel a notice of lis pendens?
A: Before final judgment, a notice of lis pendens
may be canceled upon order of the court, after
proper showing that the notice is for the purpose of
molesting the adverse party, or that it is not
necessary to protect the rights of the party who
caused it to be registered. It may also be canceled by
the Register of Deeds upon verified petition of the
party who caused the registration thereof. (Sec. 77,
P.D. 1529)
F. NON-REGISTRABLE PROPERTIES
Q: What are the kinds of non-registrable
properties?
1. Forest or timberland;
2. Foreshore land and seashore;
3. Mangrove swamps; (DoF v. Villareal, 1980)
4. Mineral Lands (Lepanto v. Durnyung, G.R. Nos.
L-31666-8 1979);
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CIVIL LAW (AND PRACTICAL EXERCISES)
5. Military Reservations (Republic v. Marcos, G.R.
No. L-32941, 1973)
6. Navigable rivers streams & creeks;
7. Lakes; (CIVIL CODE, Art. 502);
8. Watershed; (Tan v. DoF, G.R. No. L- 24548,
1983);
9. Grazing Lands;
10. Previously Titled Land;
11. Man-made Alluvial Deposit along River (Republic
v. CA, G.R. No. L-61647,1984).
G. DEALINGS WITH UNREGISTERED
LANDS
Q: What are the legal consequences of dealings
with unregistered land?
1. Under Act 3344, registration of instruments
affecting unregistered lands is without prejudice
to a third party with a better right (Radiowealth
Finance Co. v. Palileo, G.R. No. 83432,1991)
2. If a parcel of land covered by Torrens title is sold,
but the sale is registered under Act 3344, and not
under the Land Registration Act, the sale is not
considered registered (Vda. de Melencion v. CA,
G.R No. 148846. 2007),
Q: Was the mere execution of a Deed of Sate
covering an unregistered parcel of land enough
to bind third persons?
A: No. The reliance on an unnotarized and
unregistered deed of absolute sale of real property
executed in one's favor is misplaced and
unwarranted, for the non-registration of the deed
meant that the sale could not bind third parties. The
transaction affecting unregistered lands covered by
an unrecorded contract, if legal, might be valid and
binding on the parties themselves, but not on third
parties. In the case of third parties, it was necessary
for the contract to be registered. (Dadizon vs. Cowl
of Appeals, G.R. No. 15911, September 30, 2009).
Q: Between a duly registered levy on attachment
and a prior unregistered sale, which one
prevails?
A: A duly registered levy on attachment takes
precedence over a prior unregistered sale. This is not
diminished by the subsequent registration of the prior
sale. This is consistent with the fundamental principle
of the Torrens system that registration is the
operative act which gives validity to the transfer or
creates a lien upon land (Suntay v. Keyser
Mercantile, Inc., G.R. No. 208462, 2014).
H. ASSURANCE FUND
Q: What is an Assurance Fund?
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A: The Assurance Fund is a special fund created by
P.D. 1529 to compensate a person who sustains loss
or damage, or is deprived of land or interest therein,
as a consequence of the bringing of the land under
the operation of the Torrens system
1. ACTION OF COMPENSATION FROM
FUNDS
Q: How can an action Assurance Fund?
A: A claim against the Assurance Fund is filed
through a civil action, which may be in the form of an
ordinary complaint for damages.
The person bringing the action for damages against
the Fund must be the registered owner or holders of
transfer certificates of title or innocent purchasers for
value (La Urbana v. Bernardo, 62 Phil. 790, 1936)
This remedy is not available when the party seeking
compensation was negligent, as when there were
circumstances which should have put him on guard
and prompted him to investigate the property
involved (Torres v. CA, 186 SCRA 679, 1990)
Q: What are the requisites for one to file such
action?
1. A person who sustained loss or damage, or is
deprived land or any estate or interest therein
2. Such loss, damage or deprivation was
occasioned by the bringing of the land under the
operation of the Torrens system or arose after
the original registration of the land
3. The loss, damage or deprivation was due to:
fraud, or any error, omission, mistake, or mis-
description in any certificate of title or in any
entry or memorandum in the registration book.
(Loss or damage should not be due to breach of
trust or mistake in resurvey resulting in
expansion of area in certificate of title.)
4. The aggrieved party was not negligent.
5. He is barred under the provisions of P.D. 1529
or under the provisions of any law from
recovering such land;
6. The action has not prescribed.
Q: Against whom filed?
1. If the loss, damage, or deprivation is wholly
through the fault, negligence, omission, mistake,
or misfeasance of the court personnel, the ROD
or his deputies and employees: the action must
be brought against the ROD and the National
Treasurer
2. If the same is attributable to persons other than
said officials, the action must be brought against
the ROD, the National Treasurer, and such other
persons. (Sec. 96, P.D. 1529)
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CIVIL LAW (AND PRACTICAL EXERCISES)
Q: Where should the action be filed?
A: Any court of competent jurisdiction: RTC in city
where property lies or resident of plaintiff
2. LIMITATION OF ACTION
Q: When must the action be filed?
A: The action must be instituted within 6 years from
the issuance of the certificate of title.
If the plaintiff is minor, insane or imprisoned, he has
additional 2 years after disability is removed to file
the action. (Sec. 102, P.D. 1529)
Q: What is the reckoning point of the 6-year
prescriptive period?
A: The phrase "from the time the right to bring such
action first occurred" within which one may proceed
to file an action for compensation against the
Assurance Fund should be interpreted to mean the
moment the innocent purchaser for value registers
his/her title and upon actual knowledge thereof of
the original title holder. Such is the reckoning point
of the 6-year prescriptive period for filing said action
under Sec. 102 of PD 1529.
Q: How much can be recovered?
A: Compensation cannot be more than the fair
market value of land at time of loss.
Amount to be recovered is not limited to P500,000
which is maintained as standing fund. If fund is not
sufficient, National Treasurer is authorized to make
up for deficiency from other funds available to
Treasury even if not appropriated.
Execution is first sought against the person
responsible for fraud; if he is insolvent, against the
National Treasury. Thereafter, the Government shall
be subrogated to the rights of plaintiff to go against
other parties or securities. (Secs. 97,99 P.D. 1529)
I. CADASTRAL SYSTEM OF
REGISTRATION (Act No. 2259, as
amended)
Q: What is cadastral registration?
A: A proceeding in rem initiated by the filing of a
petition for registration by the government, not by
the persons claiming ownership of the land subject
thereof, and the latter are, on the pain of losing their
claim thereto, in effect, compelled to go to court to
make known their claim or interest therein and to
substantiate such claim or interest.
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Q: What are the differences between PD 1529

and Cadastral Registration? Q: Is a patent issued through administrative
P.D. 1529 CADASTRAL proceedings infeasible?
Nature Voluntary Compulsory A: Yes, it is indefeasible when registered and
Applicant Landowner Director of deemed incorporated with Torrens system 1 year
Lands after the issuance of a patent. The court, in the
Lands 1. Usually All classes of exercise of its equity jurisdiction, may direct
covered involves lands are reconveyance even without ordering the
private land included. cancellation of title.
2. It may also
refer to public NOTE: An OCT issued on the strength of a patent
agricultural partakes the nature of a certificate issued in a
lands if the judicial proceeding. (Flores v. Bagaoisan, G.R. No.
object of the 173365, Apr. 15, 2010)
action is
confirmation of
an imperfect
title.
Parties Applicant and Government /
opponent landowners
must come to
court as
claimants of
their own lands
Purpose Petitioner comes Government
to court to asks the court
confirm his title to settle and
and seeks the adjudicate the
registration of the title of the land
land in his name
A person Landowner Government
who
requests
the
survey
Effect of  No adverse If none of the
judgment claim applicants can
 If the applicant prove that he is
fails to prove entitled to the
his title, his land, the same
application shall be
may be declared public
dismissed (res judicata).
without
prejudice (no
res judicata).

J. REGISTRATION THROUGH
ADMINISTRATIVE PROCEEDINGS
(C.A. 141, as amended)

Q: What is registration through administrative

proceedings?
A: Public lands suitable for agricultural purposes
can be disposed of by confirmation of imperfect or
incomplete titles by administrative legalization (free
patent). (CA 141, sec. 11)

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Summary of Patents
TO WHOM
KINDS OTHER REQUIREMENTS
GRANTED
1. Grantee does not own more than 12 hectares of agricultural
land in the Philippines or has not had the benefit of any
gratuitous allotment of more than 12 hectares (§ 12)
To any Filipino
Homestead 2. Must have resided continuously for at least 1 year in the
citizen over the age
Patent municipality where the land is situated, or in the municipality
of 18 years or head
(C.A. 141) adjacent to the land (§ 14)
of a family
3. Must have cultivated at least 1/5 of the land continuously since
the approval of application (§ 14)
4. Payment of required fee (§ 14)
1. Order of priority in distribution:
a. agricultural lessees and share tenants;
b. regular farmworkers;
Emancipation Any qualified
c. seasonal farmworkers;
Patent / farmer beneficiary
d. other farmworkers;
Certificate of who must be a
e. actual tillers or occupants of public lands;
Land landless resident of
f. collectives or cooperatives of the above beneficiaries; and
Ownership the same barangay
g. others directly working on the land.
Awards (or in the absence
2. Landless (owns less than 3 has. of agricultural land)
(CLOA) thereof, a landless
3. A Filipino citizen
(P.D. 27 & R.A. resident of the
4. At least 15 years of age or head of the family at the time of
6657) same municipality)
acquisition of property
5. Has willingness, availability, and aptitude to cultivate and make
the land productive as possible.
1. Grantee does not own more than 12 hectares of land
2. Has continuously occupied and cultivated, either by himself or
To any natural- his predecessors-in-interest, tracts of disposable agricultural
born citizen of the public land for at least 20 years prior to the filing of an
Free Patent Philippines application for agricultural free patent
(C.A. 141, as 3. Has paid real property taxes on the property while the same has
amended by not been occupied by any person
RA No. 11573)
Note: Grant will be limited to 12 hectares only
1. Maximum land area:
Highly urbanized cities 200 sqm
Other cities 500 sqm.
First and second class 750 sqm
municipalities
Other municipalities 1000 sqm
Residential
Any Filipino citizen
Patent 2. Land applied for is not needed for public service and/or public
who is an actual
(R.A. 10023) use, as certified by the LGU
occupant of a
residential land 3. Continuous possession and occupation of the land by the
A type of free applicant or his predecessor-in-interest, under a bona fide claim
patent of acquisition of ownership for at least 10 years before the filing
of the application for patent

Note: Zoned residential areas inside a delisted military reservation

or abandoned military camp, and those of LGUs or townsites,
preceding the National Integrated Protected Areas System (NIPAS)
law, are included

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1. To have at least 1/5 of the land broken and cultivated within 5

years from the date of the award
Citizens of the 2. Before any patent is issued, he must show actual occupancy,
Philippines of cultivation, and improvement of at least one-fifth of the land until
lawful age or head the date of final payment.
of the family may 3. For agricultural lands suitable for residential, commercial, or
purchase public industrial purposes, a patent is issued only after:
Sales Patent
agricultural land of a. Full payment of purchase price, and
(C.A. 141) b. Completion of the construction of permanent improvements
not more than 12
hectares appropriate for the purpose for which the land is purchased
sold through public (must be completed within 18 months from date of award)
auction/sealed
bidding

CADT refers to a title formally recognizing the rights of possession

and ownership of ICCs/IPs over their ancestral domains identified
and delineated in accordance with this law.

CALT refers to a title formally recognizing the rights of ICCs/IPs

over their ancestral lands.

2 modes of acquisition of CADTs and CALTs:

1. By Native Title of ICCs/IPs over both ancestral domains and
lands
2. By Torrens Title under Public Land Act and the Land
Certificate of Registration Act (now Property Registration decree) over
Ancestral ancestral lands only:
To Indigenous
Domain Title a. Continuous possession and occupation in the concept of an
Community/People
(CADT) and owner since time immemorial or for a period of not less than
by the National
Certificate of 30 years of individually-owned ancestral lands by individual
Commission on
Ancestral members of cultural communities, by themselves or through
Indigenous People
Land Title their predecessors-in-interest
(NCIP)
(CALT) b. Claims are uncontested by the members of the same
(R.A. 8371) ICCs/IPs
c. Individually-owned ancestral lands must be agricultural in
character and are actually used for agricultural, residential,
pasture, and tree farming purposes for it to be classified as
alienable and disposable agricultural lands of the public
domain
d. The ancestral lands shall be classified as public agricultural
lands regardless of whether they have a slope of 18% or
more
e. Option to register ancestral land must be exercised within
(20) years from October 29, 1997 (approval date of the
IPRA)

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K. RECONSTITUTION OF TITLES A document, on file in the Registry of Deeds,

by which the property, the description of which
Q: What are the requirements for judicial is given in said document, is mortgaged,
reconstitution of title? (LDR-FB) leased or encumbered, or an authenticated
1. The certificate of title had been Lost or destroyed. copy of said document showing that its original
2. The Documents presented by the petitioner are has been registered;
sufficient and proper to warrant reconstitution of
the lost or destroyed certificate of title. 
 Any other document which, in the judgement of
3. The petitioner is the Registered owner of the the court, is sufficient and proper basis for
property or had an interest therein. 
 reconstituting the lost or destroyed certificate
4. The certificate of title was in Force at the time it of title (R.A. 25, Secs. 2&3)
was lost or destroyed. 

5. The description, area, and Boundaries of the
property are substantially the same and those Q: In an action for reconstitution of title, what
contained in the lost or destroyed certificate of must the claimants prove?
title. (Heirs of Toring v. Heirs of Boquilaga, G.R. A: That a title had been issued and that said
No. 163610, Sep. 27, 2010, citing R.A. 26, § 2, 3, certificate of title was still in force at the time it was
12 and 13.) lost or destroyed. It is necessary that the RD issue a
certification that such was in force at the time of its
Q: What are the valid sources for judicial alleged loss or destruction. The RD cannot issue
reconstitution of title? such certification merely because of the dearth of
A: Original certificates of title (OCT) and Transfer records in its file. (RP v. Sanchez, G.R. No. 212388,
certificates of title (TCT) shall be reconstituted from 2014)
such of the sources hereunder enumerated as may
be available, in the following order: Q: What are the requirements for administrative
ORIGINAL TRANSFER reconstitution of title?
CERTIFICATES OF CERTIFICATES 1. There is a substantial loss or destruction of the
TITLE OF TITLE original land titles due to fire, flood, or other force
majeure as determined by the Administrator of
The owner's duplicate of the certificate of
the LRA
title;
2. The number of certificates of title lost or
damaged should be at least 10% of the total
The co-owner's, mortgagee's or lessee's number in the possession of the Office of the
duplicate of the certificate of title; ROD; and
3. These lost or damaged titles should not be less
A certified copy of the certificate of title, than 500.
previously issued by the register of deeds or by
a legal custodian thereof; Q: What are the valid sources for administrative
An authenticated The deed of transfer reconstitution of title?
copy of the decree of or other document, on 1. Owner’s duplicate of the certificate of title
2. Co-owner’s, mortgagee’s, or lessee’s duplicate
registration or patent, file in the registry of
of said certificate
as the case may be, deeds, containing the
pursuant to which the description of the
original certificate of property, or an
-- end of topic --
title was issued; authenticated copy
thereof, showing that
its original had been
registered, and
pursuant to which the
lost or destroyed
transfer certificate of
title was Issued;

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IV. PRACTICAL EXERCISES
A. DEMAND AND AUTHORIZATION
LETTERS
1. Relevant Provisions
Those obliged to deliver or to do something incur in
delay from the time the obligee judicially or
extrajudicially demands from them the fulfillment of
their obligation.
However, the demand by the creditor shall not
be necessary in order that delay may exist:
a. When the obligation or the law
expressly so declare; or
b. When from the nature and the
circumstances of the obligation it
appears that the designation of the
time when the thing is to be delivered
or the service is to be rendered was a
controlling motive for the establishment
of the contract; or
c. When demand would be useless, as
when the obligor has rendered it
beyond his power to perform.
In reciprocal obligations, neither party incurs in
delay if the other does not comply or is not ready to
comply in a proper manner with what is incumbent
upon him. From the moment one of the parties fulfills
his obligation, delay by the other begins. (New Civil
Code, Art. 1169)
Unless otherwise stipulated, such action by the
lessor shall be commenced only after demand to
pay or comply with the conditions of the lease and
to vacate is made upon the lessee, or by serving
written notice of such demand upon the person
found on the premises if no person be found
thereon, and the lessee fails to comply therewith
after fifteen (15) days in the case of land or five (5)
days in the case of buildings. (Rules of Court, Rule
70, Sec. 2)

2. Form: Demand Letter for Collection

[Letterhead]

April 21, 2022

Mr. Cardio Dalisay
101 CityScape Tower, Mandaluyong City
Re: [SUBJECT]

Dear Mr. Dalisay,

We are writing on behalf of our client, Mrs. Alicia Florrick (“Mrs. Florrick”).

Mrs. Florrick has informed us that: [insert summary of basic facts supporting your client’s
demand/cause of action].

Demand is made upon you to pay Mrs. Florrick the sum of Fifteen Million Pesos (Php15,000,000.00)
within 15 days from your receipt of this letter. Otherwise, our client will be constrained to file the appropriate
actions against you in order to protect her rights.

We trust that you will give this demand your most urgent attention.

Yours,
Atty. Mike Ross

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3. Form: Demand Letter to Vacate the Leased Premises

[Letterhead]

April 21, 2022

Mr. Pedro Dalisay
101 CityScape Tower, Mandaluyong City
Re: [SUBJECT]

Dear Mr. Dalisay,

We are writing on behalf of our client, Mrs. Kanyay West (“Mrs. West”).

Mrs. West has informed us that: [insert summary of basic facts supporting your client’s demand/cause
of action].

We wish to inform you that your acts constitute clear violations of [insert applicable laws or regulations
violated by the addressee which give rise to a cause of action in your client’s favor].

Demand is made upon you to vacate the leased premises within 15 days from your receipt of this
letter. Otherwise, our client will be constrained to file the appropriate actions against you in order to protect
her rights.

We trust that you will give this demand your most urgent attention.

Yours,
Atty. Mikey Mouse

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4. Form: Authorization Letter

April 21, 2022

THE BRANCH CLERK OF COURT

Regional Trial Court
Branch 143, City of Makati

Re: [SUBJECT]

To the Branch Clerk of Court:

This is to authorize my counsel, XXX Law Firm and its lawyers and apprentices, including but not limited
to Atty. Mike Ross, Atty. Harvey Specter, and Atty. Rachel Zane, to obtain copies of records pertaining to the
aforementioned case on my behalf.

For clarifications, you may reach me at 09176281727.

Thank you for your kind consideration.

Very Truly Yours,

[insert signature]
Corona V. Irus

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5. Form : General Power of Attorney

GENERAL POWER OF ATTORNEY

KNOW ALL MEN THESE PRESENTS:

I, John Lloyd dela Cruz of legal age, married to Vea Alonso, Filipino, a resident of #123, 1st Street,
San Miquel, Manila, do hereby name, constitute, and appoint Ellena Darna, to be my true and lawful attorney,
for me and in my name, place, and stead, to do and perform the following acts and things to wit:

To have, sue, and to take any all lawful ways and means for the recovery thereof by suit,
attachment, compromise or otherwise:

To delegate in whole or in part any all of the powers herein granted or conferred, by means of an
instrument in writing, favor of any third persons whom my said attorney may select;

HEREBY GIVING AND GRANTING unto my said attorney full power and authority whatsoever
requisite or necessary or proper to be done in and about the premises as fully to all intents and
purposes as I might and could lawfully do if personally present, with power of substitution and
revocation, and hereby, ratifying and confirming all that my said attorney or his substitute shall
lawfully do or cause to be done under and by virtue of these presents.

IN WITNESS WHEREOF. I have hereunto set my hand this 9th day of September, 2022 in Manila,
Philippines.

(Sgd.) John Lloyd dela Cruz (Sgd.) Ellena Darna

Principal Attorney-in-fact

Signed in the presence of:

(Sgd.) Vea Alonso (Sgd.) Maja Blanca Salvador
Witness. Witness

ACKNOWLEDGMENT

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6. Form: Special Power of Attorney

SPECIAL POWER OF ATTORNEY

KNOW ALL MEN THESE PRESENTS:

I, Toms Cruz of legal age, married to Anjelica Julie, Filipino, a resident of #123, 1st Street, San
Miquel, Manila, do hereby name, constitute, and appoint Eng Be Tin, to be my true and lawful attorney, for
me and in my name, place, and stead, within a period of one (1) year, to do the following acts and deeds:

To sell, offer for sale, and come to an agreement to the purchase price and thereafter to sign for me
and in my name and receive payment from the sale of my property more particularly described as follows :
(insert technical description of the property on the title)

HEREBY GIVING AND GRANTING unto my said attorney full power and authority
whatsoever requisite or necessary or proper to be done in and about the premises as fully to all
intents and purposes as I might and could lawfully do if personally present, with power of
substitution and revocation, and hereby, ratifying and confirming all that my said attorney or his
substitute shall lawfully do or cause to be done under and by virtue of these presents.

IN WITNESS WHEREOF. I have hereunto set my hand this 9th day of September, 2022 in
Manila, Philippines.

(Sgd.) Toms Cruz (Sgd.) Eng Be Tin

Principal Attorney-in-fact

Signed in the presence of:

(Sgd.) Anjelica Julie (Sgd.) Maise Konyelo
Witness. Witness

ACKNOWLEDGMENT

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B. SIMPLE CONTRACTS
1. Lease and Sale
Special Rules for Transactions Involving Real
Property
For transactions involving real rights to be
enforceable, they must be in writing and subscribed
by the parties charged. As a general rule, evidence
of the agreement cannot be received without the
writing. (Civil Code, Art. 1403 (2) (e))
A contract involving real rights which is in writing and
subscribed by the parties, but is not found in a public
instrument, is valid. Thus, as a general rule, a
defective notarization does not affect the validity of
a contract. However, the instrument becomes a
private instrument which must be proved following
the rules in Sections 20-22 of Rule 132 of the Rules
of Court. (Teoco v. Metrobank, G.R. No. 162333,
2008)
For deeds, conveyances, encumbrances,
discharges, powers of attorney and other voluntary
instruments involving real property to be registrable
with the Register of Deeds, the Property
Registration Decree requires the following:
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CIVIL LAW (AND PRACTICAL EXERCISES)
a. The transaction must be contained in a
public instrument
b. The instrument must be signed by the
person/s executing the same in the
presence of at least two witnesses,
who shall likewise sign it
c. The instrument must be acknowledged
to be the free act and deed of the
person/s executing the same before a
notary public or other authorized public
officer
d. Where the instrument consists of two
or more pages, including the page
whereon acknowledgment is written,
each page of the copy which is to be
registered, except the page where the
signatures already appear at the foot of
the instrument, shall be signed on the
left margin by the person/s executing
the instrument and their witnesses, and
all the pages sealed with the notarial
seal, and this fact as well as the
number of pages shall be stated in the
acknowledgment.
e. Where the instrument acknowledged
relates to a sale, transfer, mortgage or
encumbrance of two or more parcels of
land, the number thereof shall likewise
be set forth in said acknowledgment.
(P.D. 1529, Sec. 112)
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2. Form: Contract of Sale and Lease

[NAME OF CONTRACT]

KNOW ALL MEN BY THESE PRESENTS:

This [Name of Contract] (“Agreement”) is entered into this [day] day of [Month] [Year] at [Place], by and between:

[FIRST PARTY]

and

[SECOND PARTY]

(The First Party and the Second Party are hereinafter collectively referred to as the “Parties”)

WITNESSETH: That –

WHEREAS:

A.

B.

C.

NOW, WHEREFORE, premises considered, the Parties hereby agree as follows:

[BODY OF CONTRACT]

IN WITNESS WHEREOF, the Parties have entered into this Agreement on the day and the year first above
written.

By: By:
___________________________ ___________________________
FIRST PARTY SECOND PARTY

Witnessed by:

_____________________________ _____________________________

[INSERT ACKNOWLEDGMENT]

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3. Form: Deed of Sale of Registered Real Property

DEED OF ABSOLUTE SALE

KNOW ALL MEN BY THESE PRESENTS:

This Deed of Absolute Sale (“Deed”) is entered into this [day] of [Month] [Year] at [Place], by and between:

[FIRST PARTY/SELLER]

and

[SECOND PARTY/BUYER]

(the First Party and the Second Part are hereinafter collectively referred to as the “Parties”)

WITNESSETH: That –

WHEREAS:
1. SELLER is the registered owner in fee simple of a parcel of land with improvements covered by
[Transfer or Original Certificate] Title No. [XX], issued by the Register of Deeds of
[City/Municipality] (the “Property”); and
2. BUYER intends to buy the Property.

NOW, WHEREFORE, premises considered, the Parties hereby agree as follows:

3. The SELLER shall SELL, TRANSFER, and CONVEY absolutely and unconditionally to BUYER the
Property together with the buildings and improvements thereon situated in the City of Makati, and
more particularly described as follows:
[Technical Description of property; specify metes and bounds of the property with approximate area
thereof, as indicated on the face of the title]
4. The BUYER shall pay for the Property the amount of [AMOUNT IN WORDS] PESOS (PhP XXX.00)
upon execution of this Deed of Absolute Sale.
5. The BUYER shall bear all expenses for the transfer of the title of the Property in his name.

IN WITNESS WHEREOF, the parties have signed this contract on this __th day of [Month] [Year] at [Place of
Signing]

By: By:

[NAME OF SELLER] [NAME OF BUYER]

SELLER BUYER

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Note: If the Buyer and/or Seller is married, marital consent must be

secured; thus, the Deed must also indicate this. Hence, add the
following:

With my consent:

NAME OF SPOUSE OF BUYER/SELLER

Seller(Buyer)’s Wife/Husband

SIGNED IN THE PRSENCE OF

[WITNESS 1 NAME] [WITNESS 2 NAME]

[INSERT ACKNOWLEDGMENT]

Note: If the instrument conveys 2 or more

parcels of land, pursuant to the Property
Registration Decree, include the following
after the first paragraph in the
acknowledgment:

This instrument relates to the sale (or mortgage) of

2 parcels of land, and consists of 2 pages including
the page on which this acknowledgment is written,
each and every page of which, on the left margin,
having been signed by [SELLER] and her
witnesses, and sealed with my Notarial seal.

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4. Special Rules for Sale of Exceptions:

Personal Property
General Rule: An agreement for the sale of goods,
chattels, or things in action, at a price not less than
P500, must be in writing, or else it is unenforceable.
(Civil Code, Art. 1403 (2) (d))
a. If the buyer accepts and receives part of
such goods and chattels, or the evidences,
or some of them, of such things in action or
pay at the time some part of the purchase
money, the contract becomes enforceable.
b. When a sale is made by auction and entry
is made by the auctioneer in his sales book,
at the time of the sale, of the amount and
kind of property sold, terms of sale, price,
names of the purchasers and person on
whose account the sale is made, then the
sale is also enforceable. (Civil Code, Art.
1403 (2) (d)

5. Form: Deed of Sale of Personal Property (Motor Vehicle)

DEED OF ABSOLUTE SALE

OF A MOTOR VEHICLE

KNOW ALL MEN BY THESE PRESENTS:

This Deed Of Absolute Sale (the “AGREEMENT”) is made and executed into this [day] of [Month] [Year] at
[Place], by and between:

ELON MUSKETEER Filipino, of legal age, married, and with address at [Address (“SELLER”)

And

BANG HYUNGA, Filipino, of legal age, married, and with address at [Address], (“BUYER”)

WITNESSETH: That –

WHEREAS:

A. SELLER is the registered owner of a motor vehicle in fee simple as shown by Certificate of Registration
No. [xxx], a copy of which is hereto attached as Annex “A” and specifically described as follows:
MAKE: ENGINE NO:

SERIES: SERIAL/CHASIS NO.:

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TYPE OF BODY: PLATE NO.:

YEAR MODEL: FILE NO.:

B. BUYER intends to buy the Motor Vehicle.

NOW, WHEREFORE, premises considered, the Parties hereby agree as follows:

1. The SELLER hereby sells, assigns, conveys, and transfers absolutely and unconditionally unto the
BUYER the Motor Vehicle, and the BUYER accepts the same, on an as-is-where-is basis;
2. The BUYER shall pay for the Motor Vehicle the amount of [INSERT AMOUNT IN WORDS] PESOS
(PhP XXX.00) upon execution of this Deed of Absolute Sale;
3. The BUYER shall bear all expenses for the execution and registration of this Deed of Absolute Sale.

IN WITNESS WHEREOF, the parties have signed this contract on this __th day of [Month] [Year] at [Place of
Signing]

By: By:

ELON MUSTKEETEER BANG HYUNGA

SELLER BUYER

Note: If the Buyer and/or Seller is married, marital consent must be

secured; thus, the Deed must also indicate this. Hence, add the
following:

With my consent:

NAME OF SPOUSE OF BUYER/SELLER

Seller(Buyer)’s Wife/Husband

SIGNED IN THE PRSENCE OF

[WITNESS 1 NAME] [WITNESS 2 NAME]

[INSERT ACKNOWLEDGMENT]

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6. Contract of Lease writing and subscribed by the parties charged to be

enforceable: (1) when the contract lasts for a period
Special Rules for Contract of Lease: There are of more than one year and (2) when the transaction
two instances when a contract of lease must be in involves real rights. (Civil Code, Art. 1403 (2) (e))

CONTRACT OF LEASE

KNOW ALL MEN BY THESE PRESENTS:

This Agreement is made and entered into at the City of Makati, this __th day of [MONTH], [YEAR], by and
between:

GANDARA PARK, of legal age, married to CARDIO DALISAY (LESSOR), and resident of Makati City,
and
CHAROT SANTOS, of legal age, single and resident of Quezon City (LESSEE)

WITNESSETH that:

1. In consideration of a monthly rental of [AMOUNT IN WORDS] PESOS (PhP XXX.00) and the
covenants made below, the LESSOR hereby LEASES to the LESSEE an apartment located at [ADDRESS]
covered by Transfer Certificate of Title/Condominium Certificate of Title (for condominium units) No. [XXX]
for a period of TWELVE (12) MONTHS from signing of this contract.
2. The LESSEE covenants, as follows:
2.1. To pay the rentals on or before the fifth day of each month, without need of demand at the
residence of LESSOR;
2.2. To keep the premises in good and habitable condition, making the necessary repairs inside and
outside the house;
2.3. Not to make major alterations and improvements without the written consent of the LESSOR and
in the event of such unauthorized major alterations and improvements, surrendering ownership over
such improvements and alterations to the LESSOR upon expiration of this lease;

IN WITNESS WHEREOF, the parties have signed this contract on the __th day of [MONTH] [YEAR] at
[PLACE OF SIGNING].

(sgd.) (sgd.)
GANDARA PARK CHAROT SANTOS
Lessor Lessee

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With my consent:
(sgd.)
CARDIO DALISAY

SIGNED IN THE PRESENCE OF:

_____________________________ _____________________________
WITNESS 1 WITNESS 2

[INSERT ACKNOWLEDGMENT]

C. COMPLAINT
2. Form: Complaint
1. Definition
Complaint: pleading alleging the plaintiff's cause or
causes of action. The names and residences of the
plaintiff and defendant must be stated in the
complaint

REPUBLIC OF THE PHILIPPINES

[COURT]
[JUDICIAL REGION]
[CITY/PROVINCE], BRANCH __

[NAME]
Plaintiff,

Civil Case No. ______________

- versus -
For: _______________________

[NAME]
Defendant.
x------------------------------------------------------------------------------------------x

COMPLAINT

[Name] (“Plaintiff”), by counsel, respectfully states:

PARTIES

1. Plaintiff is [provide details]. Plaintiff may be served with orders and other court processes
through the undersigned counsel at the address indicated below.

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2. Defendant is [provide details], where it may be served with summons and other court
processes.

ALLEGATIONS COMMON TO ALL CAUSES OF ACTION

[state relevant and material facts; refer to actionable documents, affidavits and documentary/object evidence] 2

FIRST CAUSE OF ACTION:

[DESCRIBE HERE]

3. Plaintiff repleads the foregoing allegations.

4. [state legal basis of claim; show that plaintiff has cause of action based on the relevant facts]
SECOND C AUSE OF ACTION:
[DESCRIBE HERE]

5. Plaintiff repleads the foregoing allegations.

6. [state legal basis of claim; show that plaintiff has cause of action based on the relevant facts]

In support of the instant complaint, Plaintiff intends to present the following witnesses, whose judicial
affidavits are attached herein:

7. [Name of witness] – The witness will testify that [substance of the testimony of the witness].

PRAYER

WHEREFORE, plaintiff respectfully prays that [state relief here].

Plaintiff prays for other just and equitable relief.

[place, date].

[counsel’s details]

2
A copy of the _______________ is attached as Annex __.

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D. JUDICIAL AFFIDAVIT

Form: Judicial Affidavit

Judicial Affidavit: Affidavits submitted by the
parties which shall take the place of their witnesses'
direct testimonies (A.M. No. 12-8-8-SC, Sec. 2).

Republic of the Philippines

REGIONAL TRIAL COURT
National Capital Judicial Region
City of Manila
Branch 45
PEOPLE OF THE PHILIPPINES,
Plaintiff,
-versus- Criminal Case No. 12345
JOHN LLOYD DELA CRUZ For: Estafa
Accused
x ----------------------------------------------- x
JUDICIAL AFFIDAVIT
(of Prosecution witness JOHN LLOYD DELA CRUZ in lieu of Direct Testimony)

OFFER OF TESTIMONY:
The testimony of the witness John Lloyd dela Cruz is being offered to prove that he is an eyewitness
to the crime of Estafa. He will testify what he saw the day of their transaction with the accused and what later
transpired in their agreement dated July 22, 2016. The witness will identify the accused in open court as the
person who committed the crime as well as documents in the course of his testimony.

I, JOHN LLOYD DELA CRUZ, 44 years old, employed as a businessman, residing at #123, 1st Street, San
Miguel, Manila, after having been duly sworn in accordance with law; hereby depose and state:

PRELIMINARY STATEMENT
The person examining me is ATTY. LIZA SOBRANGANO with law office address at #123, 1st
Street, Mendiola, Manila. My Judicial affidavit is being taken at the above-mentioned place in the presence
of John Sy and my companions.

The questions are asked in the English Language but are translated in the Tagalog dialect which I
speak and fully understand. I am giving my answers fully conscious that I do so under oath and I am aware
that I may face criminal liability for false testimony or perjury for false statements made or given by me.

1. Q: Mr. Witness, will you please tell the Honorable Court your name, age and other personal
circumstances?
A: I am John Lloyd dela Cruz, 44 years old, a businessman, and a resident of #123, 1st
Street, San Miguel, Manila.
2. Q: What is the nature of your business?

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A: I am engaged in the buying and selling of jewelries.

3. Q: How long did you endeavor your business?
A: It started in 2006 sir.
4. Q: Do you know the accused in this case, Pedro Santos?
A: Yes, I know him.
5. Q: How do you know Pedro Santos, the accused?
A: He is one of my agents in the jewelry business

IN WITNESS WHEREOF. I have hereunto set my hand this 19th day of April, 2020 in Manila,
Philippines.

(Sgd.) John Lloyd dela Cruz

Affiant

SUBSCRIBED AND SWORN to before me this _________________ at _______________. I have identified

affiant through his _______________ issued at _______________ on ______________ bearing his photograph and
signature.

ATTESTATION

I, __________, of legal age, Filipino, and with office address at __________, under oath and state that:

1. I conducted the examination of witness, __________, on __________, in connection with the above-
captioned case.

2. I faithfully recorded or caused to be recorded the questions that I asked and the answers that the witness
gave as stated in his judicial affidavit.

3. Neither I nor any other person present or assisting the witness coached him regarding his answer stated in
his Judicial Affidavit.

(Sgd.) John Lloyd dela Cruz

Affiant

SUBSCRIBED AND SWORN to before me this ______________ at _____________, affiant personally

appeared and exhibited to me his Philippine Driver’s License Identification Card with I.D. No. __________ and
bearing her photograph and signature.

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E. WILLS
1. Definition
A will is an act whereby a person is permitted, with
the formalities prescribed by law, to control to a
certain degree the disposition of his estate, to take
effect after his death (CIVIL CODE, Art. 783).
2. Relevant Provisions
The making of a will is a strictly personal act; it
cannot be left in whole or in part to the discretion of
a third person, or accomplished through the
instrumentality of an agent or attorney (CIVIL
CODE, Art. 784).
Every will must be in writing and executed in a
language or dialect known to the testator (CIVIL
CODE, Art. 804).
3. Holographic Wills
Holographic wills must be entirely written, dated,
and signed by the hand of the testator (CIVIL CODE,
Art. 804).
In the probate of a holographic will, it shall be
necessary that at least one witness who knows the
5. Form: Holographic Will
City of Pasig
09 September 2022
I hereby execute this holographic will in my handwriting and in the English language which I know how
to read and write, bequeathing my vacation house located at 911 General Luna, Surigao del Norte,
Philippines, to my son, Augustine Watsons, and cash amounting to five thousand pesos (P5,000) to my wife,
Emma Watsons
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CIVIL LAW (AND PRACTICAL EXERCISES)
handwriting and signature of the testator explicitly
declare that the will and the signature are in the
handwriting of the testator. If the will is contested, at
least three of such witnesses shall be required
(CIVIL CODE, Art. 811).
4. Notarial Will
Requisites of a Will:
1. In writing (CIVIL CODE, Art. 804)
2. Executed in a language or dialect known to the
testator (CIVIL CODE, Art. 804).
3. Subscribed at the end by the testator or by
testator’s name written by a person in his
presence (CIVIL CODE, Art. 805).
4. Attested and subscribed by at least three
instrumental witnesses (CIVIL CODE, Art. 805)
5. Testator and witnesses must sign each and
every page thereof except the last on the left
margin (CIVIL CODE, Art. 805)
6. Pages should be numbered correlatively in
letters on the upper part of each page (CIVIL
CODE, Art. 805)
7. Attestation clause (CIVIL CODE, Art. 805)
8. Acknowledgement before a notary public (CIVIL
CODE, Art. 806)
(Sgd.) Henry Watsons
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BAR OPERATIONS 2022 CIVIL LAW (AND PRACTICAL EXERCISES)

6. Form: Notarial Will

REPUBLIC OF THE PHILIPPINES )

CITY OF MANILA ) S.S.

LAST WILL AND TESTAMENT

KNOW ALL MEN THESE PRESENTS:

I, Johnny Deph of legal age, married to Amber Deph, Filipino, a native of the Philippines, now residing
at #143, 9th Street, Aurora Ave., Manila, being of sound and disposing mind and memory, and not acting
under influence, violence, fraud, or intimidation of whatever kind, do by these presents declare this to be my
Last Will and Testament which I have cause to be written in English, the language which is known to me. And
I hereby declare that:

1. The following are my children with their addresses:

(Insert names and addresses)
2. I give and bequeath to my children Donald Deph, Leonardo Deph, and Bradd Deph, in equal
shares, the folling properties, real and personal, whatsoever and wheresoever located:
(Insert description of property)
3. I designate Harry Potter as the sole executor of this Last Will and Testament.

IN WITNESS WHEREOF. I have hereunto set my hand this 9th day of September, 2022 in Manila,
Philippines.

(Sgd.) Johnny Deph

Testator

ATTESTATION CLAUSE
We, the undersigned attesting witnesses, whose residences are stated opposite our respective
names, do hereby certify:

That the testator, Johnny Deph, has published unto us the foregoing will consisting of three (3)
pages numbered correlatively in letters on the upper part of each page, as his/her Last Will and Testament
and has signed the same on each and every page thereof on the left margin, in our joint presence, and we, in
turn, at his/her request have witnessed and signed the same on each and every page thereof, on the left
margin, in the presence of the testator and in the presence of each and all of us.
(Sgd.) Anjelica Julie (Sgd.) Maise Konyelo
(Insert witness residence) (Insert witness residence)
(Sgd.) Tobi Wan
(Insert witness residence)

JOINT ACKNOWLEDGMENT

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