1.

Persons

A. When Law Takes Effect Doctrine:

Art. 2, NCC – Laws shall take effect after 15 days following the completion of its publication in the official
gazette unless it is otherwise provided.

The sentence “unless it is otherwise provided” refers to the date of effectivity of the law and not to the
requirement of publication – Tanada v. Tuvera.

Failure to comply with the requirement of publication violates due process and hence the law shall be
treated never to have taken effect at all.

B. Ignorance of the Law:

Laws are required to be published as a condition for their effectivity, and to give effect to the maxim
“ignorancia lexit neminem excusat”. Thus, all laws are covered by this publication requirement and this
may be done in the official gazette or a newspaper of general circulation.

House Bill (2021) – Publication requirement thru online or print official gazette. However, this bill has
not yet been approved by the senate and the president. Therefore, we stick to the provisions of Art. 2 that
the publication of law must be made in the official gazette or in a newspaper of general circulation.

C. Retroactivity of Laws

GR: Laws shall be applied prospectively. All statutes are to be construed as having only prospective
operation. (Art. 4, NCC – Laws shall have no retroactive effect unless the contrary is provided.)

XPN:

1. When the law itself provides for its retroactive effect provided that no vested rights will be
impaired.

Xpn to xpn:

a. Ex post facto law

b. Impairment of the obligations in the contract.

2. If the law is procedural in nature. (remedial statutes)

Sps. Dacudao v. Justice Gonzales, 2013 - The law is valid as it is procedural in nature; one which
does not create a new right or take away vested right. They merely operate in the furtherance of already
existing rights. All procedural laws therefore are applicable retroactively.

3. In case of curative statutes.

Xpn to xpn:

a. If it will violate the constitution.

b. If it will destroy the rights of third persons.
c. Final judgment

4. If it creates substantive rights for the first time.

5. If the law is penal in nature and it is favorable to the accused who is not a habitual delinquent.

D. Mandatory or Prohibitory Laws

Art. 5, NCC – Acts executed against the provisions of mandatory or prohibitory laws shall be void, except
when the law itself authorizes their validity.

Par. 3, Art. 17, NCC - 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.

E. Waiver of Rights

Whether the right be substantive or procedural, a person having such right may waive it.

Article 6. Rights may be waived – rights may be waived. Provided that the waiver is not contrary
to law, public order, public moral, public policy, good customs or prejudicial to the rights of third
persons with the right recognized by law.

Requisites of a valid waiver:

1. It must be an existing right.

2. The holder of the right must have the capacity to waive it.
 3. The waiver must not be contrary to law or public order or public policy, or it must not be
prejudicial to third persons.

Nepomuceno production case: Issue – WON the parties to a mortgage contract can waive the requirement
of posting and publication under the law of extrajudicial foreclosure.

SC Ruling: The parties cannot waive such requirement. (Uano v. CA) Parties to a mortgage contract
cannot waive such requirement.

The principal object of the notice of sale in foreclosure of mortgage is to inform the public generally of
the nature and condition of the property. Notices are given to secure bidders and the requirement of
the law are not for the mortgagor’s protection alone but for the public and it is imbued with public
policy considerations and any waiver therefor will be inconsistent with the law of extrajudicial
foreclosure.

F. Presumption and Applicability of Custom

G. Legal Periods

H. Territoriality Principle

The states have exclusive authority to deal with criminal issues arising within their territory.

Art. 14, NCC – Penal laws and those of public security and safety shall be obligatory upon all who
live or sojourn in the PH territory.

GR: Citizens as well as aliens are subject to PH law, even if the foreigner is just sojourning in the PH.

XPN: even if the foreigner is liable under our penal laws, they cannot be penalized based on the following
exemptions:

1. PH has waived criminal jurisdiction over them on the basis of international agreement. (eg.
Vienna Convention, art. 29)

I. Conflict of Laws

Nationality principle – Laws relating to family rights and duties and to the status and condition of persons
are binding upon citizens of the PH even though living abroad.

Art. 15, NCC – wherever a Filipino might be, he shall be subject to PH laws with respect to his family
rights.

CASE: Two minors contracted marriage in a country which considers them as adult. Such
marriage is still regarded as void under PH law because their legal capacity is determined by PH
law.

Art. 16 (1), NCC – Real property as well as personal property is subject to the law of the country where it is
situated. (Lex situs)

Art. 16 (2), NCC – However, intestate and testamentary successions, both with respect to the order of
succession and to the amount of successional rights and to the intrinsic validity of testamentary
provisions, shall be regulated by the national law of the person whose succession is under consideration,
whatever may be the nature of the property and regardless of the country wherein said property may be
found.

Art. 1039, NCC - Capacity to succeed is governed by the law of the nation of the decedent.

1. Lex Nationalii

Art. 15, NCC: Lex Nationalii – Laws relating to family rights and duties, or to the status, condition,
and legal capacity of persons are binding upon PH citizens even though living abroad.

2. Lex Rei Sitae

 3. Lex Loci Celebrationis

Par. (1 & 2), Art. 17, NCC - The forms and solemnities of contracts, wills and other public
instruments shall be governed by the laws of the country in which they are executed.

When the acts referred to are executed before the diplomatic or consular officials of the Republic
of the Philippines in a foreign country, the solemnities established by Philippine laws shall be
observed in their execution.

4. Doctrine of Renvoi

J. Human Relations in Relation to Persons

K. Capacity to Act

Capacity to act Juridical Capacity

Power to do acts with legal effect Fitness of a person to be the subject of legal relations

Active Passive

Aptitude to exercise rights. Aptitude for the holding and enjoyment of right.

Acquired (not inherent) and may be lost. Inherent in natural persons.

Lost through death and may be restricted by Lost upon death and cannot be limited or restricted.
other causes.
Must exist with juridical capacity. Can exist without juridical capacity to act
May be restricted or limited. Cannot be limited or restricted.

Presumption of Capacity: Refers to the power to do acts with legal effect [Art. 37, Civil Code].

Standard Oil Co. v. Arenas, 1911 - Capacity to act must be supposed to attach to a person who has not
previously been declared incapable, and such capacity is presumed to continue for so long as the contrary
is nor proved.

1. Restrictions on Capacity to Act - Circumstances which modify, limit, or restrict capacity to act:

a) Minority
b) Insanity or imbecility
c) Deaf-mutism
d) Civil Interdiction (Penalty) 5. Prodigality
e) Family relations
f) Alienage
g) Absence
h) Insolvency and trusteeship

Religious belief and political opinion do not limit the capacity to act [Art. 39, Civil Code].

Note: Incapacitated persons are not exempt from certain obligations arising from his acts or property
relations.

Restrictions in capacity to act generally affect obligations arising from contracts only. As a rule, they do
not affect those arising from law, quasi-delicts, etc. Also, certain rights are not affected by incapacity, such
as the right to inherit or to support.

I. Minority
 Art. 234, Family Code is amended, lowering the age of emancipation/majority from 21 to 18 years. Arts.
235 and 237 of Family Code are repealed [RA 6809].

 Effects on Contracts

1. Art. 1327, NCC – They cannot give consent to a contract.

2. Art. 1397, NCC – Minority cannot be asserted by the other party in an action for annulment.
3. Art. 1399, NCC – Not obliged to make restitution except insofar as he has been benefited.
4. Art. 1426, NCC – Minor has no right to demand the thing /price voluntarily returned by him
5. Art. 1427, NCC – Minor has no right to recover voluntarily paid sum or delivered thing, if
consumed in good faith.
6. Art. 1489, NCC – Must pay a reasonable amount for necessaries delivered to him.
7. Art. 1390, NCC – A contract where one of the parties is a minor is voidable.
8. Art. 1403, NCC – A contract is unenforceable when both of the parties are minors (incapable of
giving consent).

 Estoppel.

GR: Works against minors who misrepresent their ages in a contract and are compelled to comply with its
terms - Mercado v. Espiritu, 1917.

XPN: However, when a minor made no active misrepresentation as to his minority and such minority is
known to the other party, the contract may be annulled by the minor upon attaining age the age of
majority - Bambalan v. Maramba, 1928.

Failure of the minors to disclose their age does not constitute fraud. Because it was merely a passive
misrepresentation, they were not estopped and cannot be legally bound by their signature in the contract.
They do not have to pay the interest, they may just return their portion of the loan. However, the minors
are obliged to make restitution insofar as they have been benefited from what they have received - Art.
1399, Civil Code; Braganza v. Villa Abrille, 1959.

 Effects on Marriage

a) May not yet contract marriage - Art. 5, FC.

b) Marriages, where one of the parties is below 18, even with the consent of parents/guardians, are void
– Art. 35, FC.

 Effect on Crimes [RA 9344, (Juvenile Justice and Welfare Act of 2006)]

General Rule: Exempted from criminal liability

Exception: Acted with discernment, and the minor is between 15 and 18 years of age

II. Insanity

Insanity includes many forms of mental disease, either inherited or acquired. A person may not be insane
but only mentally deficient (idiocy, imbecility, feeble-mindedness).

Insanity is the complete deprivation of reason or intelligence or power to discern - People v. Austria,
1996.

On the other hand, imbecility is the weakness of mind which, without depriving the person entirely of the
use of his reason, leaves only the faculty of conceiving the most common and ordinary ideas and such as
relate almost always to physical wants and habits.

 Prevailing Presumption: Every person is of sound mind, in the absence of proof to the contrary – Art.
800, NCC.
 Effect on Contracts

1. Art. 1327 (2), NCC – Incapacity to give consent to a contract.

2. Art. 1328, NCC – Contracts entered into during lucid intervals are valid.
3. Burden of proof – Burden of proof lies with the party asserting the contract was entered into
by the insane during a lucid interval
4. Art. 1399, NCC – Resolution of benefits.
5. Art. 1390, NCC – Voidable if one of the parties is insane.
6. Art. 1403 (3), NCC – Unenforceable if both of the parties are insane.

 Effect on Crimes

General Rule: Exempted from criminal liability [Art. 12 (1), Revised Penal Code]
 To be exempt from criminal liability on the ground of insanity, complete deprivation of intelligence in
committing the criminal act needs to be proved. The fact that the accused threatened the complainant
with death should she reveal she had been sexually assaulted by him indicates that the accused was
aware of the reprehensible moral quality of that assault, which negated the complete destruction of
his intelligence at the time of commission of the act charged - People v. Rafanan, Jr., 1991.

In the absence of proof that the defendant had lost his reason or became demented a few moments
prior to or during the perpetration of the crime, it is presumed that he was in a normal condition of
mind - USA v. Vaquilar, 1914.

 Effect on Marriage

May be annulled if either party was of unsound mind unless such party, after coming to reason, freely
cohabited with the other – Art. 45, NCC.

Action for annulment of marriage must be filed by the sane spouse who had no knowledge of the
other’s insanity, or by any relative/guardian of the insane before the death of either party; or by the
insane spouse during a lucid interval or after regaining sanity – Art. 47 (2), NCC.

III. Deaf-Mutism

 Effect on Contracts

1. Art. 1327, NCC – cannot give consent to a contract if he also does not know how to write.

2. Art. 807, NCC – can make a valid will, if able to do so; otherwise, he shall designate two persons
to read it and communicate to him, in some practicable manner, the contents thereof.

3. Art. 820, NCC – Cannot be a witness to the execution of a will.

4. Art. 1390, NCC – Voidable if one of the parties is a deaf-mute who does not know how to write.

5. Art. 1403 (3), NCC – Unenforceable if both of the parties are deaf-mutes and do not know how to
write.

IV. Prodigality

The word “incompetent” includes prodigals [Sec. 2, Rule 92, Rules of Court]

Note: It is not the circumstance of prodigality, but the fact of being under guardianship that restricts
capacity to act.

V. Civil Interdiction

It is an accessory penalty imposed upon persons who are sentenced to a principal penalty not lower than
reclusion temporal - Art. 41, Revised Penal Code.

 Effect on Parental/Marital Authority

Offender is deprived of the rights of parental authority, or guardianship, and of marital authority - Art. 34,
RPC.

 Effect on Marriage and Property

1. For the validity of marriage settlements, the participation of the guardian shall be indispensable –
Art. 123, NCC.
2. Sentence of one’s spouse to a penalty which carries with it civil interdiction is sufficient cause for
judicial separation of property – Art. 35 (1), FC.
3. The administration of exclusive property of either spouse may be transferred by the court to the other
spouse when one of them is sentenced to civil interdiction - Art. 142 (3), FC.
4. Does not have the right to manage his property and
5. Does not have the right to dispose of such by any act inter vivos - Art. 34, RPC.

VI. Family Relations

 Family relations include those:

1. Between husband and wife;

2. Between parents and children;
3. Among other ascendants and descendants; and
4. Among brothers and sisters, whether of the full- or half-blood [Art. 150, Family Code]
  Effect on Crimes

a. Justifying circumstance if acted in defense of person/rights of spouse, ascendants, descendants,

brothers/sisters, and other relatives up to the 4th civil degree - Art. 11 (2), RPC.

b. Mitigating circumstance if acted in the immediate vindication of a grave offense/felony

committed against his spouse, ascendants or relatives of the same civil degree - Art. 13 (5), RPC.
c. Descendants cannot be compelled to testify in a criminal case, against his parents and
grandparents. Unless: the crime was against the descendants OR by one parent against the other
– Art. 215, FC.

VII. Alienage - Dual Citizenship v. Dual Allegiance [Cordora v. COMELEC, G.R. No. 176947 (2009)]

Dual citizenship Dual allegiance

Arises when, as a result of the concurrent
application of the different laws of two or more
states, a person is simultaneously considered a
national by said states
Involuntary
Refers to the situation in which a person
simultaneously owes, by some positive act, loyalty to
two or more states
Result of individual’s volition

 Effects on property: Aliens cannot own or operate public utilities. Corporations should be at least 40%
Filipino, and their managing or executive officials should be Filipinos. Furthermore, alien Corporations
cannot operate for more than 50 years - Sec. 11, Art. XII, 1987 Constitution.

VIII. Absence - Absence is a limitation because it is a ground for the judicial appointment of a representative
- Art. 381, NCC.

Note: Refer to the discussion below on Absence.

IX. Insolvency and Trusteeship

Under the Insolvency Law, debtor who has been found insolvent cannot dispose of his property or receive
payments [Perez citing Act No. 1956 (Rules on Corporate Rehabilitation)].

2. Birth and Death of Natural Persons

Art. 40, NCC - The conceived child shall be considered born for all purposes that are favorable to it,
provided it be born later with the conditions specified in Art. 41, Civil Code (i.e. that the fetus be alive at
the time it is completely delivered from the mother’s womb).

This proviso, however, is not a condition precedent to the right of the conceived child; for if it were, the
first part of Art. 40 would become entirely useless and ineffective - Quimiguing v. Icao, 1970.

 Characteristics of Fetal Personality:

1. Limited – because it only has rights for purposes favorable to it.

2. Provisional/Conditional – because it should be born alive later before the rights can be
claimed.
3. Can enjoy rights – inherit by will or intestacy and be given donations even before birth.

 A conceived child has a provisional personality for all purposes favorable to it.

1. It is entitled to support - Quimiguing v. Icao, 1970.

2. It may inherit or succeed - Art. 1025, NCC.
3. It may receive donations - Art. 742, NCC.

 Period of Conception: The first 120 days of the 300 days preceding the birth of the child - Art. 166, FC.

Birth: For civil purposes, the fetus is considered born if it is alive at the time it is completely delivered
from the mother’s womb [Art. 41, Civil Code].

Because of the expectancy that it may be born, the law protects it and reserves its rights, making its legal
existence, if born alive, retroact to the moment of its conception.

Intrauterine life When considered born

7 months or more If alive ( i.e. Can breathe independently, etc upon delivery)
Less than 7 months If alive after completion of 24 hours from delivery.

Note, however:
 1. The State shall equally protect the life of the mother and the life of the unborn from conception
- Art. II, Sec. 12, 1987 Constitution.
2. The life of a new human being commences upon fertilization - Imbong v. Ochoa, 2014.

 Death - Civil personality is extinguished by death [Art. 42, Civil Code]. Criminal liability ends with
death, but civil liability may be charged against the estate [People v. Tirol, G.R. No. L-30538 (1981)].

3. Presumption of Survivorship - The statutory presumption provided by Art. 43, Civil Code applies only
when there is doubt on the order of death between persons who are called to succeed each other. It does not apply
when there is credible eyewitness as to who died first - Joaquin v. Navarro, 1953.

 Art. 43, Civil Code vs. Sec. 3(jj), Rule 131, Rules of Court

Art. 43, NCC Sec. 3 (Jj), Rule 131

Only use the presumptions when there are no facts to get interferences from.
Only used for succession purposes. Cannot be used for succession purposes.
In any circumstance Only during death in calamities, wreck, battle or
conflagration

Rule 131, Section 3(jj) provides that, except for purposes of succession, when two persons perish in the same
calamity, and it is not shown who died first, and there are no circumstantial evidence to be inferred from, the
survivorship is determined from the probabilities resulting from the strength and the age of the sexes.

Deceased A Deceased B Presumed to have survived

Under 15 Under 15 Older
Above 60 Above 60 Younger
Under 15 Above 60 Under 15
Above 15 but under 60, different sex Male
Above 15 but under 60, same sex Older
Under 15 or over 60 Between 15 and 60

L. Surnames

1. Surname of Children

 Legitimate and Legitimated Children - Reading Art. 364 of the Civil Code together with the State's
declared policy to ensure the fundamental equality of women and men before the law, a legitimate
child is entitled to use the surname of either parent as a last name - Alanis III v. CA, 2020 (TAKE
NOTE)

 Adopted Child - An adopted child shall bear the surname of the adopter - Art. 365, Civil Code; Art. 189
(1), FC.

Under RA 11642, the adopter has the right to choose the name by which the child is to be known,
consistent with the best interest of the child. An adopted child shall bear the surname of the adopter
[Sec. 41 (2), RA 11642; Art. 365, Civil Code; Art. 189 (1), Family Code].

Note: RA 11642 took effect on January 21, 2022, beyond the bar cutoff date of June 30, 2021.

 Illegitimate Child - Illegitimate children shall use the surname of their mother - Art. 176, FC.

2. Surname of Wife After and During Marriage.

 During Marriage - A married woman may use: Art. 370, Civil Code.

a. Her maiden first name and surname and add her husband’s surname, or;
b. Her maiden first name and her husband’s surname, or
c. Her husband’s full name, but prefixing a word indicating that she is his wife, such as “Mrs.”

Note: A married woman has an option, not a duty, to use the surname of her husband in any of the
ways under Art. 370, Civil Code. Hence, she is allowed to use not only any of the three provided in Art.
370, Civil Code, but also her maiden name upon marriage. A woman is not prohibited from
continuously using her maiden name once she is married because when a woman marries, she does
not change her name but only her civil status - Remo v. Sec. of DFA, 2010.

Note: Under the Philippine Passport Act (RA 8239), once a married woman opted to adopt her
husband’s surname in her passport, she may not revert to the use of her maiden name, except in the
following cases:

1. Death of Husband;
 2. Divorce;
3. Annulment; or
4. Nullity of Marriage

 After Marriage Annulment

Art. 371, In case of annulment of marriage and the wife is the guilty party, she shall resume her
maiden name and signature.

In case of annulment is the innocent party, she may choose to continue employing her former
husband’s surname, unless:

a. The court decrees otherwise, or;

b. She or the former husband is married again to another person.

 Legal Separation [Art. 372, Civil Code] - When legal separation has been granted, the wife shall
continue using her name and surname employed before the legal separation.

Note: Before the legal separation, not before the marriage.

 Death of Husband [Art. 373, Civil Code] - A widow may use the deceased husband’s surname as
though he were still living, in accordance with Art. 370, Civil Code.

3. Confusion of Names

 General Rule - Art. 374, NCC: In case of identity of names and surnames, the younger person shall be
obliged to use such additional name or surname as will avoid confusion.

 Special Rule - Art. 375, NCC: In case of identity of names and surnames between ascendants and
descendants, the word “Junior” can only be used by a son.

Grandsons and other direct male descendants shall either:

a. Add a middle name or the mother’s surname, or

b. Add the Roman numerals II, III, and so on.

Note: Although Art. 375, Civil Code restricts the use of “Junior” to sons, social usage allows the use of
“Junior” also for daughters but not for granddaughters [Paras].

4. Usurpation and Unauthorized or Unlawful Use of Name - Arts. 377-378, NCC. - Usurpation of a name
and surname may be the subject of an action for damages and other relief [Art. 377, Civil Code].

5. Change of Names

 General Rule - Art. 376, NCC: No person can change his name or surname without judicial
authority.
 Exceptions - Arts. 379-380, NCC: The employment of pen names or stage names is permitted,
provided it is done in good faith and there is no injury to third persons. Pen names and stage
names cannot be usurped [Art. 379, Civil Code].

6. Entries in the Civil Registry and Clerical Error Law - RA 9048 (Correction of Error in Name), as amended
by RA 10172 (Correction of Error in Birthday and Sex)

Grounds The petition for change of first name or nickname may be allowed in any of the following
cases [Sec. 4, RA 9048]:

a. The petitioner finds the first name or nickname to be ridiculous, tainted with
dishonor or extremely difficult to write or pronounce;

b. The new first name or nickname has been habitually and continuously used by the
petitioner and he has been publicly known by the first name or nickname
community, or;

c. The change will avoid confusion.

Under Sec. 1, RA 10172: No entry in a civil register shall be changed or corrected without a
judicial order, except:

a) Clerical or typographical errors and change of first name or nickname,

 b)  The day and month in the date of birth or sex of a person where it is patently
clear that there was a clerical or typographical error or mistake in the entry.

Requirement Sec 3, RA 10172. - Documentary Attachments:

s
1. A certified true machine copy of the certificate or of the page of the registry book
containing the entry or entries sought to be corrected or changed;

2. At least two (2) public or private documents showing the correct entry or entries
upon which the correction or change shall be based; and

3. Other documents which the petitioner or the city or municipal civil registrar or
the consul general may consider relevant and necessary for the approval of the
petition.

Additional Documentary Attachments

Generally:

Certification from appropriate law enforcement agencies that petitioner has no

pending case or no criminal record.

For Day and Month in Date of Birth and Sex:

1. Earliest school record or earliest school documents.

2. Medical records.
3. Other documents issued by religious authorities.

For Sex:

Certification by an accredited government physician attesting to the fact that

petitioner did not undergo sex change or sex transplant.

Note: RA 9048 (as amended by RA 10172) does not allow a change of first name
on the ground of sex reassignment [Silverio v. Republic, G.R. No. 174689 (2007)].

Changes in Procedure: The petition shall be published at least once a week for two
consecutive weeks in a newspaper of general circulation.

 Person during the subsistence of a previous marriage is void.

Exception - Art. 41, FC: When there is a subsequent marriage Clerical or Typographical Error - [Sec. 2
(3), RA 10172]

Refers to a mistake committed in the performance of clerical work in writing, copying, transcribing or
typing an entry in the civil register that is

1. harmless and innocuous,

2. visible to the eyes or obvious to the understanding, and
3. can be corrected or changed only by reference to other existing record or records.

Examples:

1. Misspelled name or
2. Misspelled place of birth,
3. Mistake in the entry of day and month in the date of birth or
4. The sex of the person or the like

What Cannot Be Corrected:

a. Nationality
b. Age
c. Status

M. Rules Governing Persons Who are Absent

1. Civil Code Provisions

a. Provisional Measures in case of Absence

General Rule – Art. 381, NCC: A judge, at the instance of an interested party, a relative, or a friend, may
appoint a person to represent the absentee in all that may be necessary.

Note: The same shall be observed when under similar circumstances that power conferred by the absentee
has expired.

Requisites

1. A person disappears from his domicile.

2. His whereabouts are unknown.
3. He did not leave an agent to administer his property.

 Who May Be Appointed – Art. 383, NCC.

General Rule: The spouse present shall be preferred, when there is no legal separation.

Exception: If there is no spouse, any competent person may be appointed by the court.

Safeguarding the Absentee’s Rights and Properties - Art. 382, NCC: The judge shall specify the
power, obligations, and remuneration of the absentee’s representative, regulating them, according
to the circumstances, by the rules concerning guardians.

b. Declaration of Absence

 When Absence May Be Declared - Art. 384, NCC: A person’s absence may be declared:

1. After two years have elapsed without any news about the absentee or since the receipt of the
last news, or
2. After five years have elapsed, in case the absentee left a person in charge of the administration
of his property.

 Who May Ask for the Declaration of Absence [Art. 385, Civil Code]

1. The spouse present;

2. The heirs instituted in a will, who may present an authentic copy of the same;
3. The relatives who may succeed by the law of intestacy;
4. Those who may have, over the property of the absentee, some right subordinated to the
condition of his death.

 Effectivity of the Judicial Declaration of Absence - Art. 386, NCC: The judicial declaration of absence
shall not take effect until six months after its publication in a newspaper of general circulation.

c. Administration of the Property of the Absentee

 Appointment of Administrator - Art. 387, NCC: An administrator of the absentee’s property shall
be appointed in accordance with Article 383.

 On Alienation or Encumbrance of the Property Administered [Art. 388, Civil Code] The wife who
is appointed as an administratrix of the husband’s property cannot alienate or encumber the
husband’s property; or that of the conjugal partnership, without judicial authority.

o Cessation of Administration - Art. 389, NCC: When Administration Ceases

1. When the absentee appears personally or by means of an agent;

2. When the death of the absentee is proved and his testate or intestate heir appear;
3. When a third person appears, showing by a proper document that he has acquired the
absentee’s property by purchase or other title.

 Effects of Cessation

1. The administrator shall cease in the performance of his office, and;

2. The property shall be at the disposal of those who may have a right thereto.

d. Presumption of Death

 General Rule [Art. 390, Civil Code & Art. 41, Family Code]

1. Seven years, for all purposes, except succession and marriage.

 2. Ten years, for the purpose of the opening of succession, except marriage.
3. Four consecutive years, for purposes of remarriage.

7 years For all purposes. XPN – 4 years if attended with dangerous circumstances.

XPN:
1. Succession, 2. marriage.
10 years For the purpose of the opening of succession

XPN:
1. marriage.2. Art. 390 – if above 75 years old, absence of 5 years is sufficient.
4 years For purposes of remarriage.

Exception [Art. 390, Civil Code] - If the absentee disappeared after the age of seventy-five (75) years: An
absence of five (5) years shall be sufficient to open his succession.

 Where Disappearance is Attendant with Dangerous Circumstance [Art. 391, Civil Code]
The absentee shall be presumed dead for all purposes, if he were absent under the following
circumstances:

1. Where the absentee is on board a vessel lost during a sea voyage, or an airplane which is missing, who
has not been heard of for four (4) years since the loss of the vessel or airplane;
2. Where the absentee is in the armed forces who has taken part in war, and has been missing for four
(4) years.
3. Where the absentee has been in danger of death under other circumstances and his existence has not
been known for four (4) years.

o In Case of the Absentee’s Reappearance or Proof of Existence - Art. 392, NCC:

If the absentee appears, or without appearing, his existence is proved, he shall recover his
property in which it may have been alienated or the property acquired therewith; but he cannot
claim either fruits or rents.
 Statutory Presumption on the Order of Death Between Persons Who Are Called to Succeed Each Other
[Art. 43, Civil Code]

Trigger: If there is doubt, as between two or more persons who are called to succeed each other, as to
which of them died first

Rules:

1. Whoever alleges the death of one prior to the other, shall prove the same

2. In the absence of proof: it is presumed that they died at the same time and there shall be no
transmission of rights from one to another.

2. Presumptive Death of Absent Spouse Under the Family Code

General Rule - Art. 41, FC: Marriage contracted by any due to ordinary absence, where:

a. The prior spouse had been absent for four (4) consecutive years under ordinary circumstances, or for
two (2) consecutive years under the extraordinary circumstances in Art. 391, NCC.
b. The surviving spouse had a well-founded belief that the absent spouse was already dead.

II. Marriage

A. General Principles

 Marriage – Art. 1, FC: Marriage is a special contract of permanent union between a man and a woman,
entered into in accordance with law, for the establishment of conjugal and family life. It is the foundation
of the family and an inviolable social institution. Its nature, consequences and incidents are governed by
law and not subject to stipulation, except that marriage settlement may fix the property relations during
the marriage within the limits provided by this code.

TAKE NOTE: Memorize

1) A special contract of permanent union;

2) Between a man and a woman;
3) Entered into in accordance with law;
4) For the establishment of conjugal and family life.
 5) It is the foundation of the family and an inviolable social institution;
6) Its nature, consequences, and incidents are governed by law and not subject to stipulation.

Note: Marriage settlements may fix the property relations during the marriage, within the limits provided
by this Code.

 Goitia v. Campos Rueda, 1916 - Marriage is an institution, the maintenance of which the public is
deeply interested in. It is a relation for life and the parties cannot terminate it at any shorter period by
virtue of any contract they may make. The reciprocal rights arising from this relation, so long as it
continues, are such as the law determines from time to time, and none other.

 Breach of Promise to Marry - Article 21, Civil Code. Any person who willfully causes loss or injury
to another in a manner that is contrary to morals, good customs or public policy shall compensate the
latter for the damages. Mere breach of a promise to marry is not an actionable wrong.

Wassmer v. Velez, 1964 - However, damages incurred by an injured party are actionable if proven. This
can be said to have been in violation of Art. 21, NCC.

1. Essential Requisites - Art. 2, FC.

1. Legal capacity of the contracting parties, who must be a male and a female; and
2. Consent freely given in the presence of a solemnizing officer.

 Legal capacity:

o Sex - The best source for citing the requirement of male/female is still statutory, as provided explicitly Art. 1,
Family Code. Marriage is a special contract of permanent union between a man and a woman.

Silverio v. Republic, 2007: A person’s sex is an essential factor in marriage and family relations. It is a part of
a person’s legal capacity and civil status. The sex of a person is determined at birth, visually done by the birth
attendant by examining the genitals of the infant. Thus, the words “male” and “female” in everyday
understanding do not include persons who have undergone sex reassignment. Furthermore, considering that
there is no law legally recognizing sex reassignment, the determination of a person’s sex made at the time of
his or her birth, if not attended by error, is immutable.

Republic v. Cagandahan, 2008: However, the Supreme Court ruled in this case that when the change in sex
happens naturally, as when the person has Congenital Adrenal Hyperplasia (CAH) or is “biologically or
naturally intersex,” the determining factor in their sex classification would be what they, having reached the
age of majority, with good reason thinks is their sex. Sexual development in cases of intersex persons makes
the sex classification at birth inconclusive, hence a change in name and sex as registered in the birth
certificate is here allowed.

o Age - Article 5, Family Code. Any male or female of the age of eighteen years or upwards not under any of
the impediments mentioned in Articles 37 and 38, may contract marriage.

Impediments mentioned in Art. 37 and 38

Art. 37, FC Art. 38, FC
Incestuous marriages Void for public policy:

1. Between ascendants and descendants
of any degree; and
2. Between brothers and sisters, whether
full or half-blood.
a) Between collateral blood relatives, whether legitimate or
illegitimate, up to the fourth civil degree.
b) Between step-parents and step sis-children.
c) Between parents in law and children in law.
d) Between the adopting parent and the adopted child.
e) Between the surviving spouse of the adopting parent and
the adopted child.
f) Between the surviving spouse of the adopted child and
the adopter.
g) Between an adopted child and a legitimate child of the
adopter.
h) Between adopted children of the same adopter; and
i) Between parties where one, with the intention to marry
the other, killed that other person’s spouse or his or her
own spouse.

o Consent Freely Given - Consent here refers to the consent of the contracting parties. The consent must
refer to the contracting parties’ bona fide intention to be married to the other. i.e., to make the woman his wife
[People v. Santiago, G.R. No. 27972 (1927)].

People v. Santiago, 1927: it was held that the marriage entered into by a person whose real intent is to avoid
prosecution for rape is void for total lack of consent. Here, it was the intent of the accused—not the victim of
rape, whom he married under duress—that was considered. The accused did not intend to make the victim his
wife. He merely used such marriage to escape criminal liability.

Art. 4, FC - Absence of consent renders the marriage void while defective consent makes it voidable.

Situation Consent Status of marriage

1. Art. 45 (2), FC - Either party was of unsound mind. Defective/Vitiated Voidable

2. Art. 35 (5), FC - Mistake as to the identity of the other Absent Void

party. (e.g. if one mistakenly marries his fiancés twin)

3. Mistake as to the legal consequences and nature of the Absent Void

marriage ceremony (e.g. thinking the ceremony is a
joke, pretend, or play-acting)

4. Art. 46, FC - Consent was obtained by fraud: Defective/Vitiated Voidable

o Non- disclosure of previous conviction of crime of

moral turpitude
o Concealment of pregnancy by another man
o Concealment of STD
o Concealment of drug addiction, habitual
alcoholism, homosexuality, or lesbianism
5. Art. 45 (4), FC - Consent was obtained by: Defective/Vitiated Voidable

o Force
o Intimidation
o Undue Influence

6. People v. Santiago, 1927 - Marriage entered into by a Absent Void

person whose real intent is to avoid prosecution for
rape.

No Subsisting Marriage - Art. 41, FC: A marriage contracted by any person during subsistence of a previous
valid marriage shall be null and void, unless there is a declaration of presumptive death of the absentee spouse.

Pulido v. People of the Philippines, 2021: The parties are not required to obtain a judicial declaration of
absolute nullity of a void ab initio first and subsequent marriages in order to raise it as a defense in a bigamy
case.

2. Formal Requisites – Art. 3, FC:

1. Authority of solemnizing officer (Art. 35 (2), Family Code)

2. A valid marriage license (subject to exceptions)
3. Marriage ceremony

Absence Defect / Irregularity

Note: The term “defect” is used for essential requisites while “irregularity” is
used for formal requisites.

Essential Void Voidable

Formal Void No effect, but makes the party responsible for such irregularity civilly, criminally
or administratively liable. (Art. 4-7, FC)

a. Marriage Ceremony – Art. 6, FC: No prescribed form or religious rite for the solemnization of marriage is
required.

b. Authority of Solemnizing Officer Who May Solemnize Marriage:

Normal Art. 7, FC - Incumbent member of the Judiciary, within his jurisdiction.

circumstances
Art. 7, FC - Priest, Rabbi, Imam or Minister of any Church or Religious Sect who must be:
 1. Duly authorized by his church or religious sect;
2. Registered with the civil registrar general;
3. Acting within the limits of the written authority granted to him by his church or
religious sect;
4. At least one of the contracting parties belongs to the solemnizing officer’s church
or religious sect.

Secs. 444-445, LGC - Municipal and City Mayors.

Art. 7 and 31, FC - Ship Captain or Airplane Chief may solemnize a marriage in articulo
mortis between passengers or crew members.

Art. 7-32, FC - A Military Commander of a unit may solemnize marriages in articulo mortis
between persons within the zone of military operation in the absence of a chaplain.

Marriages abroad Art. 7-10, FC - Consul-general, consul or vice-consul may solemnize marriages between
Filipino citizens abroad.

GR: Those solemnized by any person not legally authorized to perform marriages are void.
XPN: Unless such marriages were contracted with either or both parties believing in good faith that the
solemnizing officer had the legal authority to do so – Art. 35 (2), FC.

Note: Good faith refers to questions of fact, not ignorance of the law (e.g. they did not know the priest’s
license expired vs. thinking a Senator could solemnize their marriage)

Note: An irregularity in a formal requisite will not affect the validity of the marriage but those responsible
may be held criminally, civilly, and administratively liable – Art. 4 & 7, FC.

c. Marriage License

GR – ART. 9, FC: The license required is that which is issued by the local registrar of the city or municipality
where either contracting party habitually resides. Publication is required. The civil registrar determines the
age of the parties.

Where Valid: License valid in any part of the Philippines.

Period of Validity: It will be valid for 120 days from date of issue, automatically canceled at the expiration
of such period.

Marriages celebrated without a marriage license before the effectivity of the Family Code are void ab initio as
marriage license was an essential requisite in the Civil Code [Kho v. Republic, G.R. No. 187462 (2016)].

Aranes v. Occiano, 2002: A marriage which preceded the issuance of the marriage license is void and the
subsequent issuance of such license cannot render valid the marriage. Except in cases provided by law, it is the
marriage license that gives the solemnizing officer the authority to solemnize a marriage.

Foreign National

Art. 21, FC
When either or both parties are foreign nationals: Stateless persons or refugees from other countries:

Certificate of legal capacity to contract Affidavit stating circumstances showing

marriage issued by a diplomatic or consular capacity to contract marriage, instead of
official, shall be submitted before a marriage certificate of legal capacity.
license can be obtained.

Note: DFA Advisory: The Apostille Convention, which took effect in the Philippines on 14 May 2019,
simplifies the authentication of foreign documents. Public documents executed in Apostille-contracting
countries, once Apostillized, no longer need authentication from the Philippine embassy or consulate
general. In the same way, PH documents Apostillized by the DF A need not be authenticated by Foreign
embassies or consulate generals if the country is a member of the convention.

GR: Madridejo v. De Leon, 1930 - A marriage certificate is not an essential or formal requisite without
which the marriage will be void.

XPN: Tenebro v. CA, 2004 - However, it is the best evidence that a marriage does exist.
 Exemption from License Requirement
a. Art. 27, FC - Marriage The marriage may be solemnized without the necessity of a marriage license.
in articulo mortis. It remains valid even if the ailing party survives.

1. Art. 31, FC - Between passengers or crew members in a ship or

airplane.

2. Art. 32, FC - Persons within a military zone.

3. Other situations in articulo mortis.

b. Art. 28, FC - Marriage

in remote and
inaccessible
places.

c. Art. 33, FC -
Marriages by
Muslims and
Ethnic cultural
minorities provided
they are solemnized
in accordance with
their customs, rites or
practices.

d. Art. 34, FC - Marriage Note: A false affidavit of having lived together for 5 years as husband and
by parties who wife cannot be considered as a mere irregularity in the formal requisites of
have cohabited for marriage but a complete absence, rendering their marriage void ab initio -
at least 5 years De Castro v. Assidao-De Castro,2008.
without any legal
impediment to Requisites for the 5-year Cohabitation to be Valid for the
marry each other. Exemption from Acquiring a Marriage License - Borja- Manzano v.
Judge Sanchez, 2001.
Note: Ninal v.
Bayadog, 2000. 1. The man and woman must have been living together as husband and
wife for at least five (5) years before the marriage;

2. The parties must have no legal impediment to marry each other;

3. The fact of absence of legal impediment between the parties must be

present at the time of marriage;

4. The parties must execute an affidavit stating that they have lived
together for at least five years [and are without legal impediment to
marry each other]; and

5. The solemnizing officer must execute a sworn statement that he

had ascertained the qualifications of the parties and that he had
found no legal impediment to their marriage.

B. Mixed Marriages and Foreign Divorce

GR: Art. 26 (1), FC - Marriages solemnized abroad in accordance with the laws in force in that country shall be
valid in the Philippines.

Exceptions: Void when it involves

Art. 35 (1), FC - Marriage where one or both parties are below 18 years old.
Art. 35 (4), FC - Bigamous or polygamous marriage.

Art. 35 (5), FC - Mistake in identity.

Art. 35 (6), FC - Marriages void under Art. 53.

Art. 36, FC - Psychological incapacity.

Art. 37, FC - Incestuous marriages.

Art. 38, FC - Marriage void for reasons of public policy.

Note: This means that the foreign marriage may still be recognized as valid in the Philippines even if it would have
fallen under Pars. 2 & 3, Art. 35, Family Code so long as it is valid under the law of was solemnized.

Essential requisites Formal requisites

Inherent in the parties, carried everywhere Requirements independent of the parties

Art. 15, NCC: Lex Nationalii – Laws relating to family Art. 17, NCC: Lex loci celebrationis – If valid where
rights and duties, or to the status, condition, and legal celebrated, then valid everywhere; forms of
capacity of persons are binding upon PH citizens even contracting marriage are to be regulated by the law
though living abroad. where it is celebrated.

Foreign marriages void under PH law due to lack of an Foreign marriages may be void under PH law due to
essential requisite, even if valid under foreign laws, absence of a formal requisite under foreign laws.
will not be recognized.

Proof of Foreign Marriage in order that it may be upheld:

a. Provisions of the foreign law, and

b. Celebration of the marriage in accordance with said provisions.

2. Foreign Divorce

Art. 26, FC - If the foreign spouse obtains a valid divorce decree abroad capacitating him/her to remarry, the
Filipino spouse shall have capacity to remarry under Philippine law.

Quita v. Dandan, 1998 - The citizenship of the spouses at the time of the divorce determines their capacity to
obtain a valid divorce.

Garcia v. Recio, 2001 - A marriage between two Filipinos cannot be dissolved even by a divorce obtained
abroad, because of Arts. 15 & 17, Civil Code.

Van Dorn v. Romillo, 1985 - Aliens may obtain divorces abroad, which may be recognized in the Philippines,
provided they are valid according to their national law; thus, it is a matter of evidence. The marriage tie when
thus severed as to one party, ceases to bind either.

Republic of the Philippines v. Manalo, 2018 - Divorces obtained abroad by Filipino citizens may now be
validly recognized in the Philippines but only in cases of mixed marriages involving a Filipino and a foreigner.
(IMPORTANT)

Following the ruling in Galapon v. Republic, 2020:

Art. 26 (2) FC - applies to mixed marriages where the divorce decree is:

1. obtained by the foreign spouse;

2. obtained jointly by the Filipino and foreign spouse; or
3. obtained solely by the Filipino spouse.

C. Void Marriages (See Tan-Andal v. Andal, G.R. No. 196359, May 11, 2021)

Void Marriages Types of Void Marriages

1. Art. 35, FC - Absence of any Void from the Beginning.

formal or essential
requisites a. Marriage where any party is below 18 years of age even with the
consent of parents or guardians. (Essential)
b. Marriage solemnized by any person not legally authorized to perform
marriages (unless such marriages were contracted with either or both
parties believing in good faith that the solemnizing officer had legal
authority to do so) (Formal)

Note: One’s belief in good faith that the solemnizing officer has the
required authority is a mistake of fact, and not of law.

c. Marriage solemnized without a valid marriage license, except in

marriages under exceptional circumstances Bigamous or polygamous
marriages not falling under Art. 41 (Art. 41, Family Code: Subsequent
marriage by present spouse who obtained a declaration of
presumptive death for absent spouse prior to the subsequent

2. Art. 35 (4),
FC - Bigamous and
polygamous marriages
3. Art. 41, FC - Presumptive
Death: Failure of the spouse
present to obtain a judicial
declaration of presumptive
death before entering a
subsequent marriage.
4. Art. 44, FC - Bad faith of
both spouses in the
subsequent marriage
5. Art. 36, FC -
Psychologically
Incapacitated spouse
6. Art. 35 (6), FC - Void
subsequent marriages for
failure to comply with Art. 53,
Family Code
7. Art. 37, FC - Incestuous
Marriages
8. Art. 38, FC - Void by reasons
of public policy.
marriage)
Note: Alcantara v. Alcantara, G.R. No. 167746 (2007 - To be
considered void on the ground of absence of a marriage license, the
law requires that the absence of such marriage license must be
apparent on the marriage contract, or at the very least, supported by a
certification from the local civil registrar that no such marriage license
was issued to the parties.
d. There is a mistake as to the identity of the other contracting party
e. Subsequent marriages that are void under Art. 53, Family Code
(Non- compliance with Art. 52, Family Code)
Elements of a Bigamous Marriage - Capili v. People, 2013:
1. Offender legally married
2. Marriage not legally dissolved
3. Offender contracts a subsequent marriage
4. Subsequent marriage has all the essential requisites for
validity, except legal capacity.
Pulido v. People of the Philippines, 2021 - The parties are not required to
obtain a judicial declaration of absolute nullity of a void ab initio first and
subsequent marriages in order to raise it as a defense in a bigamy case.
The same rule now applies to all marriages celebrated under the
Civil Code and the Family Code. Art. 40, Family Code did not
amend Art. 349, Revised Penal Code, and thus, did not deny the
accused the right to collaterally attack the validity of a void ab
initio marriage in the criminal prosecution for bigamy.
Subsequent Marriage When One Spouse is Absent: Art. 41, FC -
Requirements for Subsequent Marriage to be Valid When Prior Spouse is
Absent.
(See discussion below)
Bad Faith of Both Spouses - If both spouses of the subsequent
marriage acted in bad faith, said marriage shall be void ab initio and all
donations by reason of marriage and testamentary dispositions made by
one in favor of the other are revoked by operation of law.
Article 36, Family Code. A marriage contracted by any party who, at
the time of the celebration, was psychologically incapacitated to comply
with the essential marital obligations of marriage, shall likewise be void
even if such incapacity becomes manifest only after its solemnization.
(See discussion below)
Incestuous Marriage - Marriages between the following are considered
incestuous, and are therefore void ab initio:
1. Between ascendants and descendants of any degree, legitimate or
illegitimate
2. Between brothers and sisters, whether full or half blood,
legitimate or illegitimate.
Against Public Policy - Marriages between the following are considered
against public policy, and are therefore void ab initio:
 1. Between collateral blood relatives, legitimate or illegitimate, up to
the fourth civil degree;
2. Between step-parents and step-children;
(Note: Stepbrothers and stepsisters can marry because marriages
between them are not among those enumerated in Art. 38, Family
Code)
3. Between parents-in-law and children-in-law;
4. Between adopting parent and adopted child;
5. Between the surviving spouse of the adopting parent and the
adopted child;

6. Between the surviving spouse of the adopted child and the

adopter;
7. Between an adopted child and a legitimate child of the adopter;
8. Between adopted children of the same adopter; and
9. Between parties where one, with the intention to marry the other,
killed that other person's spouse, or his or her own spouse.

Note: The following relationships are outside of Arts. 37-38, Family Code
and are therefore not impediments to marriage:

 Brother-in-law with sister-in-law;

 Stepbrother with stepsister;
 Guardian with ward; and
 Adopted son of the husband with adopted daughter of the wife
(i.e. stepchildren).

Article 39, Family Code. The action or defense for the declaration of absolute nullity shall not prescribe.

 Subsequent Marriage When One Spouse is Absent: Art. 41, FC - Requirements for Subsequent
Marriage to be Valid When Prior Spouse is Absent.

Subsequent marriage due to ordinary Subsequent marriage due to extraordinary

absence where: absence where:
1. Absent spouse had been absent for 4 a. Absent spouse had been missing for 2 consecutive
consecutive years; years;

2. The spouse present had a well-founded belief b. There is danger of death under the circumstances
that the absent spouse is dead; and set forth in Art. 391, Civil Code attendant to the
disappearance;

3. Judicial declaration of presumptive death c. (Onboard vessel lost at sea voyage, airplane,
was secured (no prejudice to the effect of the Armed forces in war, or Danger of death under
reappearance of the absent spouse) other circumstances, existence not known)

d. The spouse present had a well-founded belief that

the missing person is dead; and

Republic v. Granada, 2012 - The belief of the present spouse must be the result of proper and honest to goodness
inquiries and efforts to ascertain the whereabouts of the absent spouse and whether the absent spouse is still alive
or is already dead. This is drawn from circumstances before and after the disappearance and the nature and extent
of inquiries made.

Republic v. Quiñonez, 2020 - Although incapable of exact definition, “well- founded belief” requires a stringent
standard. Jurisprudence demands an active search for the absentee spouse, along with attempts to contact legal
authorities to aid in the search and corroborative evidence to support the claim that a diligent search and inquiry
was made.

 Effect of Reappearance of Absent Spouse

General Rule: The subsequent marriage remains valid.

Exception- Art. 42, FC: It is automatically terminated by the recording of the affidavit of
reappearance of the absent spouse at the instance of any interested person, with due notice to the spouses
of the subsequent marriage.

Note: It is the recording of the affidavit of reappearance that automatically terminates the subsequent
marriage. Hence, if the absentee spouse reappears without recording an affidavit of reappearance, then
there is no legal effect. Meanwhile, the absentee spouse cannot remarry.
 Exception to the Exception – Art. 41, FC: If there is a judgment annulling the previous marriage or
declaring it void ab initio.

Good faith: Period of absence for presumptive death is mandatory. However, the law shortens the
period for purposes of remarriage.

Jones v. Hortiguela, 1937 - The period of absence is counted from when the party last heard from his/her
absentee spouse.

Absence of Spouse under Art. 41 Family Code - Republic v. Nolasco, 1993:

Art. 41, FC
Grounds 1. Well-founded belief that the absent spouse is dead; and
2. Absence of:

a. 4 years under normal circumstances; or

b. 2 years under extraordinary circumstances

Summary proceedings for the declaration Required

of presumptive death
Effect on the subsequent marriage The subsequent marriage is automatically terminated by the
recording of an affidavit of reappearance of the absent spouse

 Psychological Incapacity - Article 36, Family Code. A marriage contracted by any party who, at the
time of the celebration, was psychologically incapacitated to comply with the essential marital obligations of
marriage, shall likewise be void even if such incapacity becomes manifest only after its solemnization.

Psychological incapacity Vice of consent

Has nothing to do with consent, but the incapacity to The consent itself is defective
comply with the essential marital obligations of
marriage

Psychological incapacity Insanity

Consent might be valid, but the party is unable to Vice of consent
assume essential marital obligations

Ground for nullity Ground for annulment

Example of Psychological Incapacity

 Tsoi v. CA, 1997 - The senseless and protracted refusal of one of the parties to fulfill the marital obligation "to
procreate children based on the universal principle that procreation of children through sexual cooperation is
the basic end of marriage," is equivalent to psychological incapacity. “A man who can but won’t is
psychologically incapacitated”.

Annulment under Art. 36, Family Code (as recently articulated in Tan-Andal v. Andal; Totality of
Evidence Rule)

 The Court in Tan-Andal v. Andal [G.R. No. 196359 (2021)] pronounced that psychological incapacity is not a
medical but a legal concept. It refers to a personal condition which prevents a spouse from complying with
fundamental marital obligations only in relation to a specific partner that may exist at the time of marriage
but may have revealed through behavior subsequent to the ceremonies. In this case, the Court stated that it
need not be a permanent and incurable disorder (effectively overturning previous jurisprudence on the
matter). Therefore, the testimony of a psychologist or psychiatrist is not mandatory in all cases. The totality of
evidence must show clear and convincing evidence to cause the declaration of nullity of marriage.

Things to be Considered in Invoking and Proving Psychological Incapacity: Tan-Andal v. Andal,

2021.

1. The burden of proof in proving psychological incapacity is on the plaintiff. The quantum of proof required
in nullity cases is clear and convincing evidence

2. Psychological incapacity is neither a mental incapacity nor a personality disorder that must be proven
through expert testimony. There must be proof, however, of the durable or enduring aspects of a person’s
personality, called “personality structure,” which manifests itself through clear acts of dysfunctionality
that undermines the family
 3. Incurable, not in the medical, but in the legal sense; incurable as to the partner

4. As to gravity, it must be shown that the incapacity is caused by a genuinely serious psychic cause

5. Juridical antecedence

6. Marital obligations refer to Arts 68-71, 220, 221 & 225, Family Code

7. The decisions of the National Appellate Matrimonial Tribunal of the Catholic Church of the Philippines
has persuasive effect on nullity cases pending before secular courts.

 Non-Compliance with Recording Requirement after Declaration of Nullity

o Art. 53, FC - Subsequent marriage of spouses, where the requirements of recording under Art. 52, Family
Code have not been complied with, shall be null and void.
o
o Art. 52, FC - The judgment of annulment or of absolute nullity of the marriage, the partition and
distribution of the properties of the spouses and the delivery of the children's presumptive legitimes shall
be recorded in the appropriate civil registry and registries of property; otherwise, the same shall not affect
third persons.
o
o [Valdez v. QC-RTC, 1996 - Arts. 50, 51, and 52, Family Code, in relation to Arts. 102 and 129, Family Code
(i.e., the rules governing the liquidation of the absolute community or the conjugal partnership of gains,
the property regimes for valid and voidable marriages) relate only to voidable marriages and,
exceptionally, to void marriages under Art. 40, Family Code

(i.e. the declaration of nullity of a subsequent marriage contracted by a spouse of a prior void marriage
before the latter is judicially declared void).

o People v. Mendoza, 1954 - Under the Civil Code, no judicial declaration for nullity of previous marriage
was required to contract a subsequent marriage. (Note: This is now the general rule under Pulido.)

 Art. 43, FC - Effects of Termination of Subsequent Marriage Under Art. 42.

1. Children of subsequent marriage: conceived prior to its termination considered legitimate; custody
and support decided by court in a proper proceeding.

2. Property Regime: dissolved and liquidated (party in bad faith shall forfeit his/her share in favor of the
common children or if there are none, children of the guilty spouse by a previous marriage, and in case
there are none, to the innocent spouse).

3. Donation propter nuptias: remains valid, (but if the donee contracted marriage in bad faith,
donations are revoked by operation of law)

4. Insurance benefits: innocent spouse may revoke designation of guilty party as beneficiary, even if such
designation is stipulated as irrevocable.

5. Succession Rights: party in bad faith shall be disqualified to inherit from the innocent spouse, whether
testate or intestate.

 Art. 44, FC - Both Spouses Guilty of Bad Faith: If both spouses of the subsequent marriage acted in bad
faith, all donations by reason of marriage and testamentary dispositions made by one party in favor of the
other are revoked by operation of law [Art. 44, Family Code].

 Who may File the Petition for Nullity of Void Marriages? - Ablaza v. Republic, 2010 - General
Rule: Only the husband or wife may file the petition [Sec. 2, AM No. 02-11-10-SC]. Specifically, A.M. No. 02-
11-10-SC extends only to marriages covered by the Family Code, which took effect on August 3, 1988, but,
being a procedural rule that is prospective in application, is confined only to proceedings commenced after
March 15, 2003.

Exceptions: Carlos v. Sandoval, 2008

a. Nullity of marriage cases commenced before the effectivity of A.M. No. 02-11-10- SC
b. Marriages celebrated during the effectivity of the Civil Code.

 Procedure in Attacking a Void Marriage

Void Marriages may be attacked collaterally or directly.

Safeguard Against Collusion and
No Confession of Judgment
Stipulation of Facts
Confession of Judgment
Participation of the OSG
No Motion to Dismiss
Effect of Pendency of Action for
Declaration of Nullity:
Effect of Final Judgment Declaring
Nullity
Art. 48 (2), FC - In the cases referred to in the preceding paragraph,
no judgment shall be based upon a stipulation of facts or confession
of judgment.
An admission by both parties after agreeing to the existence of any of
the grounds or facts that would constitute a void/voidable marriage.
Ocampo v. Florenciano, 1960 - The admission by one party
admitting his/her fault to cause the invalidity of the marriage.
Although the admission of guilt of the wife constitutes a confession of
judgment, the husband was also able to present other evidence to
support the allegation. Hence, there was no collusion.
Mendoza v. Republic, 2012:
The obvious intent of the AM 02-11-10-SC was to require the OSG to
appear as counsel for the State in the capacity of a defensor vinculi
(i.e., defender of the marital bond) to oppose petitions for, and to
appeal judgments in favor of declarations of nullity of marriage
under Art. 36, Family Code, thereby ensuring that only the
meritorious cases for the declaration of nullity of marriages based on
psychological incapacity-those sufficiently evidenced by gravity,
incurability and juridical antecedence- would succeed.
Aurelio v. Aurelio, 2011 - Sec. 7, AM 02-11-10-SC: Prohibits the filing
of a motion to dismiss in actions for annulment of marriage.
Art. 49, FC:
1. The court shall provide for the support of the spouses.
2. The custody and support of the common children, giving
paramount consideration to their moral and material
welfare, their choice of parent with whom they wish to
remain.
3. The court shall also provide for visitation rights of the other
parent.
 Art. 50 (1), FC: The effects provided for by Pars. 2, 3, 4 & 5, Art.
43 and by Art. 44, Family Code shall also apply in the proper
cases to marriages which are declared void ab initio or annulled
by final judgment under Arts. 40 and 45.
Final judgment in such cases shall provide for:
1. Liquidation, partition, and distribution of the properties of
the spouses
2. Custody and support of the common children
3. Delivery of their presumptive legitimes
 Art. 50 (2), FC - Unless: Such matters had been adjudicated in
previous judicial proceedings.
 Art. 50 (3), FC - All creditors of the spouses/property regime
shall be notified of the proceedings for liquidation.
 Art. 102 and 129, FC - In the partition, the conjugal dwelling and
lot shall be adjudicated to the spouse with whom majority of the
common children remain.
Generally, children born or conceived within void marriages are
illegitimate.
Exceptions:
1. Art. 54, FC - Children conceived or born before the judgment
under Art. 36 has become final and executory.
2. Art. 54, FC - Children conceived or born of subsequent
marriages under Art. 53.
D. Voidable Marriages
 Art. 4 states that a defect in any of the essential requisites shall render the marriage voidable as provided
in Art. 45, Family Code. Grounds for Annulment that Must Exist at the Time of the Marriage.
1. The party in whose
behalf it is sought to have
the marriage annulled
was (18) years of age or
over but below (21), and
the marriage was
solemnized without the
consent of the parents,
guardian or person
having substitute
parental authority over
the party, in that order,
unless after attaining the
age of (21), such party
freely cohabited with the
other and both lived
together as husband and
wife;
2. Either party was of
unsound mind, unless
such party after coming
to reason, freely
cohabited with the other
as husband and wife;
3. . The consent of either
party was obtained by
fraud, unless such party
afterwards, with full
knowledge of the facts
constituting the fraud,
freely cohabited with the
other as husband and
wife;
Lack of Parental Consent
Par. 1, Art. 45, Family Code provides the first ground for a voidable marriage,
which is the solemnization of a marriage of a party between 18-21 years of age
without the consent of their parents.
May be ratified by the party 18 or above but below 21 upon free cohabitation
upon reaching 21.
Insanity
Par. 2, Art. 45, Family Code provides the second ground for a voidable marriage,
which is a marriage entered into by an insane party or a person of unsound
mind.
Mental incapacity or insanity is a vice of consent. It can be ratified by
cohabitation after insanity is cured or during a lucid interval [Tolentino].
Katipunan v. Tenorio,1937:
Must exist at the time of the celebration of the marriage. Insanity that occurs
after the celebration of marriage does not constitute a cause for nullity.
Fraud:
Par. 3, Art. 45, Family Code provides the third ground for a voidable marriage,
wherein consent to the marriage was obtained through fraud. The party who was
the victim of the fraud may, however, ratify the detect in the marriage by
voluntarily cohabiting with the party after knowledge of the facts constituting
the fraud.
Article 46, Family Code. Any of the following circumstances shall constitute
fraud referred to in No. 3 of the preceding Article:
1. Non-disclosure of a previous conviction by final judgment of the other party of
a crime involving moral turpitude;
a. The crime must involve moral turpitude, or “Conduct that is
contrary to justice, honesty, and morality”
b. Must be convicted by final judgment
c. Conviction must be prior to marriage
Teves v. COMELEC, 2009 - A crime involves moral turpitude when it
pertains to an act of “baseness, vileness, depravity in the private and
social duties which a man owes to his fellow man or to society in
general, contrary to the accepted and customary rules of right and duty
between man and man”.
2. Concealment by the wife of the fact that at the time of marriage, she was
pregnant by a man other than her husband;
Wife must have:
1. Concealed her pregnancy and
2. Pregnancy is by another man other than her husband
Note: If the husband knew of pregnancy, the marriage cannot be
 annulled on the ground of concealment.

Buccat v. Buccat, 1941 - The woman was seven (7) months pregnant at
the time she met the petitioner. He cannot claim that the pregnancy was
concealed from him and that he was defrauded into marrying her.

Aquino v. Delizo, 1960 - But where the wife concealed the fact that she
was 4 months pregnant during the time of the marriage and was
“naturally plump,” Delizo could hardly be expected to know, by mere
looking, whether or not she was pregnant at the time of the marriage.

Note: May be ratified upon free cohabitation after knowledge of fraud.

3. Concealment of sexually transmissible disease, regardless of its nature,

existing at the time of marriage; or

Note: The STD that was concealed from the other spouse need not be
serious and incurable. When the ground for annulment falls under Par.
3, Art. 46 vis-à-vis Par. 3, Art. 45, Family Code, the healthy spouse
through cohabitation can still ratify the marriage because the defect is in
the fact of the concealment and not the gravity of the disease. Hence,
even if the STD is treatable, the fraud gives the unsuspecting spouse the
right to file for annulment.

4. Concealment of drug addiction, habitual alcoholism or homosexuality or

lesbianism existing at the time of marriage.

The non-disclosure of the drug addiction, habitual alcoholism,

homosexuality or lesbianism must have been done prior to the marriage.
Recovery or rehabilitation from STD, drug addiction, and habitual
alcoholism will not bar action for annulment; the defect is not the
disease, but the fraud which vitiated consent.

Almelor v. RTC, 2008 - It is the concealment of homosexuality, and not

homosexuality per se, that vitiates the consent of the innocent party.
Such concealment presupposes bad faith and intent to defraud the other
party in giving consent to the marriage.

No other misrepresentation or deceit as to character, health, rank, fortune or

chastity shall constitute such fraud as will give grounds for the action of
annulment of marriage.

Note: The enumeration of the grounds for annulment under Art. 46, Family
Code for reasons of fraud or vice of consent is exclusive. No other
misrepresentation or deceit of character, health, rank, fortune or chastity shall
constitute fraud.

Any Other Misrepresentation

Art. 46, Family Code categorically states that any other

misrepresentation as to character, health, rank, fortune, or chastity shall
not be a manifestation of fraud sufficient to be a ground for annulment
of marriage.

Anaya v. Palaroan, 1970 - The non-disclosure of a husband’s premarital

relationship with another woman does not constitute fraud. It was
expressly stated in Art. 46, Family Code that misrepresentation or deceit
as to one’s chastity shall not be a basis for an action to annul a marriage.

4. The consent of either Force, Intimidation, Undue Influence (wherein the consent of one party
party was obtained by was obtained by violence, intimidation, or undue influence)
force, intimidation or
undue influence, unless Art. 1335, NCC - There is violence when in order to wrest consent, serious or
the same having irresistible force is employed.
disappeared or ceased,
such party thereafter
Art. 1335, NCC - Intimidation must be one as to compel the party by a
freely cohabited with the
reasonable and well-grounded fear of an imminent and grave evil upon his
other as husband and
person/properties.
wife;
 1. Degree of intimidation: age, sex, condition of person borne in mind
2. Threat or intimidation as not to act as free agent

Note: A threat to enforce one’s claim through competent authority, if one’s claim
is just and legal, does not vitiate consent – Art. 1335, NCC.

There is undue influence when a person takes improper advantage of his

power or position over the will of another, depriving the latter of a reasonable
freedom of choice.

Art. 1337, NCC - Among the circumstances that define improper advantage are
the (1) confidential, (2) family, (3) spiritual, (4) professional or other
relationship between the parties, or the fact that the person alleged to have been
unduly influenced was suffering from (5) mental weakness, (6) ignorance, or (7)
was in financial or emotional distress.

May be ratified upon voluntary cohabitation after force, intimidation, or undue

influence has ceased or disappeared.

5. . Either party was Impotency

physically incapable of
consummating the Impotency refers to the person’s physical condition where sexual intercourse
marriage with the other, with a person of the opposite sex is impossible. It does not refer to mere sterility.
and such incapacity
continues and appears to
Refers to the inability to copulate, not procreate.
be incurable; or
Impotency being an abnormal condition should not be presumed. The
presumption is in favor of potency. The lone testimony of the husband that his
wife is physically incapable of sexual intercourse is insufficient to tear asunder
the ties that have bound them together as husband and wife.

6. Either party was afflicted Sexually-Transmissible Disease Serious and Incurable

with a sexually
transmissible disease Requisites
found to be serious and
appears to be incurable.
1. Should exist at the time of the marriage 2. Should be found serious

3. Should appear to be incurable [Art. 45 (6), Family Code]

Not subject to ratification: Cannot be ratified or validated by cohabitation.

 Nature of an Action for Annulment - Action in rem, concerns the status of parties.

a. The res is the relation between parties or marriage tie.

b. Jurisdiction depends on nationality or domicile not the place of celebration.

Art. 45, Art. 47, NCC: Who can Art. 47, NCC: Art. 45, NCC:
NCC: file. Prescription. Ratification
Ground.

Lack of Party 18 or above but Within 5 years after attaining Free cohabitation of the party
parental below 21 age of 21 who entered the marriage
consent without parental consent after
Parent or guardian who Before party below 21 reaches attaining age of 21
did not give consent 21

Insanity Sane spouse with no Any time before the death of Free cohabitation of insane party
knowledge of the other’s either party after insane party comes to
insanity reason

Legal guardian of insane Any time before the death of

party either party

Insane party During lucid interval or after Free cohabitation after insane
regaining sanity, and before party comes to reason
death
Fraud Injured (defrauded) party Within 5 years after discovery Free cohabitation of the
of fraud defrauded party after having full
knowledge of fraud

Force, Injured party Within 5 years after Free cohabitation of the injured
intimidation, disappearance of force, undue party after the force or
undue influence, or intimidation intimidation or undue influence
influence has ceased or disappeared

Impotence Potent spouse Within 5 years after marriage Cannot be ratified by action;
prescribes

Rationale: Public policy and

health.

Note: Though these marriages

cannot be ratified, the petition
for annulment will prescribe
within 5 years.

STD Healthy party Within 5 years after marriage Cannot be ratified by action;
prescribes

Rationale: Public policy and

health.

Note: Though these marriages

cannot be ratified, the petition
for annulment will prescribe
within 5 years.

 Presence of Prosecutor

Art. 48, FC - To prevent collusion between the parties, fabrication or suppression of evidence, the prosecuting
attorney or fiscal shall appear on behalf of the State.

Corpus v. Ochotorena, 2004 - In a legal separation or annulment case, the prosecuting attorney must first
rule out collusion as a condition sine qua non for further proceedings. A certification by the prosecutor that he
was present during the hearing and even cross-examined the plaintiff does not suffice to comply with the
mandatory requirement.

Comparative Table on Void and Voidable Marriages

Void Voidable
Nature No validity from the time of performance ; Valid until annulled
inexistent from the very beginning

Susceptible to Cannot be ratified Can be ratified, subject to 2 exceptions

ratification
Property Art. 147, FC - Only co- ownership. ACP or any other property regime in
relations accordance with the marriage settlement
No ACP or CPG despite having entered into a
marriage settlement Except the 2nd void
marriage under Art. 40 Family Code.

Status of children Illegitimate under Art. 165, Family Code (with Children are legitimate if conceived or
Arts. 36 and 53, Family Code as exceptions born prior to the decree
under Art. 54, Family Code)

How impugned May be attacked directly or collaterally, but for
the purpose of remarriage, a judicial declaration
of nullity is required [Art. 40, Family Code]
Can be impugned even after death of the parties
Cannot be attacked collaterally
Cannot be impugned after death of one
of the parties

Who may A proper interested person (depending on the A party to the marriage
challenge validity dates of marriage and of filing of proceeding)
 Susceptible to Does not prescribe Prescribes
prescription

E. Effect of Defective Marriages

 Effects of Pending Decree of Annulment

Art. 49, FC; Luna and Luna v. IAC, 1985 - The Court shall provide for the support of spouses and support
and custody of common children (Art. 49). In determining which parent should have custody of them, their
moral and material welfare shall be given paramount consideration.

 Effects of Decree of Annulment

Art. 50 (1), FC - (Same as Decree of Nullity) The effects provided for by Pars. 2, 3, 4 & 5 of Art. 43 and by Art.
44, Family Code shall also apply in the proper cases to marriages which are declared void ab initio or annulled
by final judgment under Arts. 40 and 45.

Art. 50 (1), FC: The effects provided for by Pars. 2, 3, 4 & 5, Art. 43 and by Art. 44, Family Code shall also
apply in the proper cases to marriages which are declared void ab initio or annulled by final judgment under
Arts. 40 and 45.

Final judgment in such cases shall provide for:

4. Liquidation, partition, and distribution of the properties of the spouses

5. Custody and support of the common children
6. Delivery of their presumptive legitimes

Art. 50 (2), FC - Unless: Such matters had been adjudicated in previous judicial proceedings.

Art. 50 (3), FC - All creditors of the spouses/property regime shall be notified of the proceedings for
liquidation.

Art. 102 and 129, FC - In the partition, the conjugal dwelling and lot shall be adjudicated to the spouse with
whom majority of the common children remain.

Generally, children born or conceived within void marriages are illegitimate.

Exceptions:

3. Art. 54, FC - Children conceived or born before the judgment under Art. 36 has become final and
executory.

4. Art. 54, FC - Children conceived or born of subsequent marriages under Art. 53.

F. Foreign Marriages

G. Legal Separation

 Lapuz Sy v. Eufemio, 1972 - An action for legal separation involves nothing more than the bed-and-board
separation of the spouses. It is purely personal in nature.
 Art. 55, FC – Grounds for legal separation:

1. Repeated physical violence or grossly Acts of Violence according to the Anti- Violence Against Women
abusive conduct directed against the and Their Children Act of 2004 (RA 9262) are also grounds for
petitioner, a common child, or a legal separation under Art. 55 (1), Family Code.
 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 the
respondent to imprisonment of more
than six (6) years, even if pardoned
5. Final judgment sentencing the
respondent to imprisonment of more
than six (6) years, even if pardoned
6. Drug addiction or habitual
alcoholism of the respondent
Lesbianism or homosexuality of the
respondent
7. Contracting by the respondent of a
subsequent bigamous marriage,
whether in the PH or abroad
8. Sexual infidelity or perversion
9. Attempt by the respondent against
the life of the petitioner
10. Drug addiction or habitual
alcoholism of the respondent
Lesbianism or homosexuality of the
respondent
B. Defenses [Art. 56, Family Code]
1. Condonation by the aggrieved Willan v. Willan, 1960 - Condonation may be given expressly or
party – after the commission impliedly . An example of an implied condonation is when a husband
of the offense; may be repeatedly has intercourse with the wife despite the wife’s cruelty.
expressed or implied. “Although he did not wish it, [he did it] eventually for the sake of peace”.
2. Consent by the aggrieved a) Express
The law does not require the violence or moral pressure to be
repeated. A single act of violence is sufficient to be a ground since
religious and political belief are human rights.
Only the respondent spouse must be guilty of corrupting or
inducing the petitioner, a common child or a child of the petitioner
to engage in prostitution.
Santos v. Court of Appeals and Bedia-Santos, 1995 - The other
forms of psychoses, if existing at the inception of marriage, like the
state of a party being of unsound mind or concealment of drug
addiction, habitual alcoholism, homosexuality or lesbianism,
merely renders the marriage contract voidable pursuant to Art. 46,
Family Code.
If drug addiction, habitual alcoholism, lesbianism or homosexuality
should occur only during the marriage, they become mere grounds
for legal separation under Art. 55 Family Code.
Note: As a ground for legal separation, however, there is no need
for a criminal conviction for bigamy.
Dedel v. Court of Appeals, 2004 - the Supreme Court ruled that a
spouse's sexual infidelity or perversion and abandonment, by
themselves, do not constitute psychological incapacity within the
contemplation of Art. 36, Family Code.
Garlet v. Garlet, 2017 - Irreconcilable differences, sexual infidelity
or perversion, emotional immaturity and irresponsibility, and the
like, do not by themselves warrant a finding of psychological
incapacity under Art. 36, as the same may only be due to a person's
refusal or unwillingness to assume the essential obligations of
marriage and not due to some psychological illness that is
contemplated by this rule.
Dela Cruz. v. Dela Cruz, 1968 - Abandonment is not mere physical
estrangement but also financial and moral desertion. There must
be an absolute cessation of marital relations, duties, and rights with
the intention of perpetual separation.
Ong Eng Kiam v. Ong, 2006 - To be a ground for legal separation,
abandonment must be without just cause.
- written agreement (Matubis v. Praxedes, 1960)
 party to the commission of
the offense – before the b) Implied - The non-interference of the husband with regard to the
commission of the offense; amorous relations between his wife and Ramos constitutes consent
may be express (People v. Sensano and Ramos, 1933)

3. Connivance between parties
in the commission of the
offense
Sargent v. Sargent, 1920 - Connivance is present when the husband
throws no protection around his wife nor warns her against intimacy with
the driver. A husband who had reliable reports for two months that gave
him reason to suspect that his wife was having an affair with her driver yet
did nothing to keep the latter away is guilty of connivance.

4. Mutual guilt or recrimination

between spouses in the
commission of any ground for
legal separation

5. collusion between parties to
obtain decree of legal
separation
6. Reconciliation of parties
during pendency of action
Brown v. Yambao, 1957 - Collusion in matrimonial cases is the act of
married persons in procuring a divorce by mutual consent, whether by
preconcerted commission by one of a matrimonial offense, or by failure, in
pursuance of agreement, to defend divorce proceedings.
Art. 65, FC - A joint manifestation, under oath and duly signed by the
spouses shall be filed with the court in the same proceeding for legal
separation.

7. Death of either party during Lapuz Sy v. Eufemio, 1972 - Death of the plaintiff before decree of legal
pendency of action separation abates the action. There is no more need for legal separation
because the marriage is already dissolved by the death of one of the
parties.

8. Prescription of action for legal Article 57, Family Code. An action for legal separation shall be filed within
separation five years from the time of the occurrence of the cause.

 Procedure

Who may File the Action Sec. 2, A.M. No. 02-11- 11-SC (Rule on Legal Separation) - A petition for legal
separation may be filed only by the husband or the wife.

Where to File the Action Sec. 2, A.M. No. 02-11-11-SC - The petition shall be filed in the Family Court of the
province or city where the petitioner or the respondent has been residing for at least
six months prior to the date of filing “or in the case of a non-resident respondent,
where he may be found in the Philippines, at the election of the petitioner”.

When to File Action Art. 57, Family Code; A.M. No. 02-11-11-SC - An action for legal separation shall be
filed within five years from the time of the occurrence of the cause.

Cooling-off and Art. 58, Family Code - An action for legal separation shall in no case be tried before
Reconciliation Effects six months shall have elapsed since the filing of the petition.

Art. 59, Family Code - Actions cannot be tried unless the court has attempted to
reconcile the spouses, and determined that despite such efforts, reconciliation is
highly improbable.

Note: This is without prejudice to judicial determination of custody of children,

alimony, and support pendente lite.

This Family Code provision dictating a mandatory 6-month cooling-off period does
not apply in cases where violence, as used in RA 9262 (Anti-Violence Against
Women and their Children), is alleged. The case should be heard as soon as possible
by the court.

 Effects of Filing Petition, Effects of Pendency, Effects of Decree of Legal Separation,

Reconciliation, Effect of Death of One of the Parties:

a) Effects of Pendency Art. 61 (1), FC - The spouses are entitled to live separately, but the marital
bond is not severed.

Art. 61 (2), FC - Administration of community or conjugal property – If

there is no written agreement between the parties, the court shall designate

b) Effects of Decree of
Legal Separation
c) Reconciliation
d) Effect of Death of One of
the Parties
e) Effects of Reconciliation
Void Marriages, Voidable Marriages and Legal Separation
Void
Grounds
 Absence of essential or
formal requisites
one of them or a third person to administer the ACP or CPG.
Note: No motion to dismiss the petition shall be allowed except on the
ground of lack of jurisdiction over the subject matter or over the parties;
provided, however, that any other ground that might warrant a dismissal of
the case may be raised as an affirmative defense in an answer.
(Sec. 4, A.M. No. 02-11-11-SC)
The Court shall provide for: [Arts. 62 & 49, Family Code]
1. Support of spouses
2. Custody of children: The court shall give custody of children to one of
them, if there is no written agreement between the spouses.
3. Visitation rights of the other spouse
 Art. 63, FC - The spouses can live separately but the marriage bonds are
not severed.
 Arts. 63 & Art. 43 (2), FC - The ACP or CPG shall be dissolved and
liquidated, and the share of the guilty spouse shall be forfeited in favor
of the common children, previous children, or innocent spouse, in that
order.
 Arts. 63 & 213, FC - Custody of the minor children shall be awarded to
the innocent spouse.
 Art. 63, FC - Guilty spouse shall be disqualified from inheriting from
the innocent spouse by intestate succession. The provisions in favor of
the guilty party in the will of the innocent spouse shall also be revoked
by operation of law.
 Art. 64, FC - Donations in favor of the guilty spouse may be revoked but
this action prescribes after 5 years from the decree of legal separation
 Art. 64, FC; Sec. 11, PD 612 - Innocent spouse may also revoke
designation of guilty spouse as beneficiary in an insurance policy, even
if such stipulations are irrevocable.
 Art. 198, FC - Obligation for mutual support ceases, but the court may
order the guilty spouse to support the innocent spouse.
 Laperal v. Republic, 1992 - The wife shall continue to use the surname
of the husband even after the decree for legal separation.
Lapuz Sy v. Eufemio, 1972 - The death of either party to a legal separation
proceeding, before final decree, abates the action. There is no more need for
legal separation because the marriage is already dissolved by the death of
one of the parties. An action for legal separation is also purely personal
between the spouses.
Effects of Reconciliation:
1. Art. 66 (1), FC - Proceedings for legal separation shall be terminated at
whatever stage.
2. Art. 66 (2), FC - If there is a final decree of legal separation, it shall be
set aside.
3. Arts. 66-67, FC - The separation of property and forfeiture of share of
the guilty spouse shall subsist, unless the spouses agree to revive their
former property regime or to institute another property regime.
4. Joint custody of children is restored.
5. The right to intestate succession by the guilty spouse from the innocent
spouse is restored.
6. The right to testamentary succession depends on the will of the
innocent spouse.
Voidable Legal Separation
Defect in any of the Grounds not relating to any of
essential requisites: the essential or formal
 a. One is a minor 1. Lack of parental requisites:
consent,
b. No authority to marry 2. Insanity, 1. Repeated physical
3. Fraud, violence
4. Force, intimidation, 2. Pressure to compel to
c. No valid marriage
undue influence, change
license
5. Impotence, religious/political
6. Serious and incurable affiliation
 Bigamous and polygamous STD 3. Corruption/
marriages
inducement to engage
in prostitution
 Mistake of identity 4. Final judgment with
sentence of more than 6
 Psychological incapacity years
5. Drug addiction/
 Incestuous marriages habitual alcoholism
6. Homosexuality/
 Marriages against public lesbianism
policy 7. Bigamous marriage
8. Sexual infidelity or
 Subsequent marriages perversion
which did not comply with 9. Attempts against the
Art. 53, Family Code life of petitioner
10. Abandonment without
just cause for more than
1 year

Defenses None 1. Condonation

2. Consent
3. Connivance
4. Collusion
5. Recrimination
6. Prescription
Prescription No prescription 1. Lack of parental consent

1. Spouses: 5 years Within 5 years from the

after turning 21 occurrence of the cause
2. Parents: before the
spouses turn 21

2. Insanity

1. Insane spouse:
during lucid
intervals
2. Sane spouse/
guardian: lifetime

3. Fraud: 5 years after the

discovery of the fraud

4. Force, intimidation,
undue influence: 5 years
after cessation

5. Impotence/STD: 5 years
from marriage
Who can According to A.M. No. 02- 11-
file 10-SC:

1. Before March 18, 2003

(petition for nullity or Only the spouses (cannot Only the spouses (cannot
celebration of survive the death of the survive the death of the
marriage) - any party plaintiff) plaintiff)

2. On and after March 18,

2003 (petition for
nullity or celebration
of marriage) - only the
Spouses

According to Enrico v. Heirs of

 Medinaceli, 2007
3. Upon death of the parents -
the heirs
Note: Upon the death of the
parent his heirs have already a
vested right over whatever
property left by the parent.
Hence, upon the death of
anyone of the guilty party to
the void marriage, his heirs
may file a petition to declare
the marriage void [Enrico v,
Heirs of Medinaceli, supra].
Effects of
pendency
In the absence of adequate provisions in a written agreement:
1. Support of spouses
2. Support and custody of children
3. Visitation rights
Effects of 1. General Rule: Properties
decree [Art. 147-148, Family Code]
1. Art. 147 (equal shares)
governs property
relations of void
marriages
2. Art. 148 (in
proportion) governs
property relations of
bigamous adulterous
relationships
Exception: 2nd void marriage
under Art. 40.
2. Status of Children [Art. 54,
Family Code]
General Rule: Conceived or
born before the judgment of
absolute nullity, illegitimate
Exceptions: Conceived or
born
1. Before the judgment of
annulment;
2. Before the judgment of
absolute nullity under
Art 36, FC
(Psychological
Incapacity)
c. Of the subsequent marriage
under Art. 53, FC (Failure to
Record the Decree of Nullity of
Annulment);
d. Prior to the termination of
the subsequent marriage
under Art. 42, FC (when the
absent spouse files an affidavit
of reappearance)
1. Live separately
2. Designate either of them or
a third person as
administrator of property
3. Support of spouses
4. Support and custody of
children
5. Visitation rights
1. Properties [Art. 50, 1. Properties [Art. 63 (2),
Family Code] Family Code]
2. ACP/CPG a. Dissolution and Liquidation
dissolved, share of ACP/CPG
forfeited to heirs if
bad faith
Support and Custody [Art. 213,
Family Code]
3. Donations valid,
except if bad faith
1. Parental authority to
the parent designated
c. Insurance may
by Court after all
be revoked if bad
relevant consideration
faith
d. No succession
2. Tender years
presumption for Child
for spouse in bad
under 7 y.o. [Art 213,
faith
Family Code]
4. Status of Children
Inheritance, Donations and
[Art. 54, Family
Designation in Insurance
Code]
Policies [Sec. 22, Rules on Legal
Separation]
a. Conceived or born before
judgment, legitimate.
Continued Use of Surname [Art.
372, Civil Code]
3. Continued Use of
Surname [Art. 371, Civil
Code]
a. Dependent on her being
the innocent or guilty party
H. Property Relations Between Spouses

A. General Provisions

Requisites for Validity of Marriage Settlements [Art. 75, Family Code]

1. Future spouses agree upon the regime of absolute community, conjugal partnership of gains, complete
separation of property, or any other regime.
2. In the absence of marriage settlement, or when the regime agreed upon is void, the system of absolute
community property as established in this Code shall govern.

Requirements for Marriage Settlements and any Modification Thereof [Art. 77, Family Code]

1. Must be made in writing

2. Signed by the parties
3. Executed before the marriage celebration
4. If executed by a person below 21 years, valid only when persons required to give consent to the marriage
(father, mother, or guardian, respectively) are made parties to the agreement [Art. 78, Family Code; Sec.
3, RA 6809 amending Art. 236, Family Code]

Note: Marriage settlements are considered accessory to the marriage, therefore as per Art. 81, Family Code,
stipulations in consideration of future marriage and donations will be void if the marriage does not take place.

Should the surviving spouse contract a subsequent marriage without compliance with the foregoing
requirements, a mandatory regime of complete separation of property shall govern the property relations of
the subsequent marriage [Art. 103 (3), Family Code].

1. Donation Propter Nuptias

Solis v. Barroso, 1928 - Donations propter nuptias are made in consideration of marriage. There can be a valid
donation even if the marriage never took place, but the absence of marriage is a ground for the revocation of the
donation.

Mateo v. Lagua, 1969 - Donations propter nuptias are without onerous consideration, marriage being merely the
occasion or motive for the donation, not its cause. Being liberalities, they remain subject to reduction for
inofficiousness upon the donor’s death, if they should infringe the legitime of a forced heir.

Requisites of Donation Propter Nuptias

1. Made before the celebration of marriage

2. Made in consideration of marriage
3. Made in favor of one or both of the future spouses
4. In a public document and not merely privately stipulated [Solis v. Barroso, G.R. No. 27939 (1928)]

Who May Donate

1. Spouses to each other

2. Parents of one or both spouses
3. Third persons to either or both spouses

Donations Excluded are:

1. Ordinary wedding gifts given after the celebration of marriage

2. Donations in favor of future spouses made before marriage but not in consideration thereof
3. Donations made in favor of persons other than the spouses even if founded on the intended marriage

Distinguished from Ordinary Donations

Donation propter nuptias Ordinary donations

Does not require express acceptance Express acceptance required

May include future property (subject to formalities of
wills)
In case of donation between spouses, if present
property is donated and the property regime is not
absolute community, limited to 1/5 [Art. 84, FC]
Grounds for revocation found in Art. 86, Family Code
Cannot include future property
No limit to donation of present property provided
legitimes are not impaired
Grounds for revocation found in donation laws Civil
Code provisions

Grounds for Revocation of Donation Propter Nuptias [Art. 86, Family Code]
 Marriages not celebrated

Donation contained in marriage Rendered void [Art. 81, Family Code]

settlement Does not prescribe
Donation contained in a separate Donor’s choice
instrument
Prescribes within 5 years from supposed date of marriage

2. Void Donations by the Spouses

Void marriages

GR: There must be a judicial declaration of nullity for the void marriage.

1. Art 40, in relation to Art 53,
Family Code (void subsequent
marriage due to non- compliance
with registration requirement in
Art. 52, Family Code)
2. Art 44, Family Code (bad faith in
securing declaration of
presumptive death)
If donee- spouse contracted the If both parties acted in good
second marriage in bad faith faith, revocation will be by donor’s
(knowing that it was void), choice; within 5 years from date of
donations in favor of the second finality of the judicial declaration
marriage are revoked by operation of nullity.
of law.
If either or both spouses in the
subsequent marriage acted in bad
faith (knowing that the person was
still alive), donations in favor of the
subsequent marriage is revoked by
operation of law.

3. All other void marriages Donor’s choice, regardless of good

or bad faith of the donee

Other causes of annulment Revoked by operation of law if

donee is the guilty spouse who
acted in bad faith

Upon legal separation, done the Revocation is by donor’s choice

guilty spouse – Art. 64, FC. and done within 5 years from
finality of decree of legal separation

Resolutory condition complied General Rule: Revocation is by

with donor’s choice and done within 5
years from finality of decree of
legal separation

Exception: If the other spouse is

Acts of ingratitude – Art. 765, NCC
the donor, action does not
prescribe
General Rule: Revocation is by
donor’s choice and done within 1
year from knowledge of fact of
ingratitude with donor being
capable of bringing suit

3. Absolute Community of Property Regime

 Definition - The community property consists of all the property owned by the spouses at the time of the
celebration of the marriage, and those either one or both of them acquired during the marriage. Property
acquired during the marriage is presumed to belong to the community, unless proved to be excluded
therefrom [Art. 93, Family Code].

 If Marriage Does Not Take Place - Everything stipulated in the settlements or contracts referred to in
the preceding articles in consideration of a future marriage, including donations between the prospective
spouses made therein, shall be rendered void if the marriage does not take place. However,
stipulations that do not depend upon the celebration of the marriages shall be valid [Art. 81, Family
Code].

 Provisions on Co-ownership Apply - The provisions on co-ownership shall apply to the absolute
community of property between the spouses in all matters not provided for in this Chapter [Art. 90,
Family Code].

N.B. The creditors of the spouse who made such waiver may petition the court to rescind the waiver to the
extent of the amount sufficient to cover the amount of their credits.
4. Conjugal Partnership of Gains Regime

 This property regime was formerly the default regime under the Civil Code.

In this regime, the spouses retain ownership of their separate property. However, the spouses place in a
common fund the proceeds, products, fruits and income of their separate property and those acquired by
either or both spouses through their efforts or by chance. The presumption applies that all properties
acquired during the marriage belong to the CPG. There are 3 distinct patrimonies in this system, the
husband’s capital property, the wife’s paraphernal property, and the conjugal property.

ACP CPG

 When it Art. 88, FC - At the precise moment of For marriages after the Family Code, CPG
commences the celebration of the marriage. becomes the property regime only if
agreed to by the parties through a
marriage settlement

 What it consists Art. 91, FC - All the properties owned by 1. Proceeds, products, fruits, and
of the spouses at the time of the celebration income of their separate
of the marriage or acquired thereafter. properties
2. Everything acquired by them
during marriage through their
own efforts

Zulueta v. Pan American World Airways,

1973 - Moral damages arising from a
contract paid from the CPG.

Mendoza v. Reyes, 1983 - Loans

contracted during the marriage are
conjugal, and so is any property acquired
therefrom.

Art. 118, Family Code - Property

purchased by installment, paid partly with
conjugal funds and partly with exclusive
funds, if full ownership was vested during
the marriage; the CPG shall reimburse the
owner-spouse.

If a winning ticket is bought by conjugal

funds, the prize is conjugal (otherwise, the
prize is exclusive property of the spouse
who owns the ticket)

Improvement on exclusive property: if

original value is less than new value
(where new value = value of land + value
of improvements + net change in value),
then land becomes conjugal property,
subject to the reimbursement of the value
of the property of the owner-spouse at the
dissolution of the CPG

Property belonging to one spouse

converted into another kind totally
different in nature from its original orm
during marriage becomes conjugal in the
absence of proof that the expenses of the
conversion were exclusively for the
account of the original owner- spouse,
subject to reimbursement of the value of
the original property from the conjugal
partnership

Art. 95, FC - Winnings from Everything acquired through their efforts

gambling shall accrue to the community or by chance
property but obligations from gambling
shall not.

Ocampo v. Ocampo, 1983 - Property

acquired during marriage is presumed to
 have been obtained through joint efforts
of parties, even though one did not
actually participate in the acquisition.
This is true for a party whose efforts
consisted in the care and maintenance of
the family household. Such is regarded as
contributions to the acquisition of
common property by one who has no
salary, income, work or industry.
Under the ACP, spouses cannot exclude
specific properties from the regime
unless done in settlement
 What remains Properties acquired before the marriage,
exclusive for those with legitimate descendants by
property (Art. 92, a former marriage (to protect rights of
FC) children by a former marriage)
Properties acquired during the marriage
by a gratuitous title, i.e., donation,
inheritance by testate and intestate
succession, including the fruits of such
properties
Except: When expressly provided by the
donor or testator that the property shall
form part of the CP
Properties for personal use i.e., wearing
apparel, toilet articles, eyeglasses
Except:
Luxurious jewelry and those of special
value that increase in value over time
(partakes of the nature of an investment)
Specific properties [Art. 117, Family Code]
1. Acquired by onerous title during the
marriage at the expense of the Common
Fund;
2. Acquired through the labor, industry,
work, or profession of either or both
spouses
3. Fruits from common property and net
fruits of the exclusive property of each
spouse
4. Share of either spouse in hidden
treasure, whether as finder or owner of
property where treasure was found
5. Acquired through occupation such as
fishing or hunting
6. Livestock existing at dissolution of
partnership in excess of what is brought by
either spouse to the marriage
7. Acquired by chance, such as winnings
from gambling or betting
Property brought into the marriage by
each spouse as his/her own
Properties acquired during the marriage
by a gratuitous title, i.e., donation,
inheritance by testate and intestate
succession (but the fruits of such
properties form part of the CPG)
Except: When expressly provided by the
donor or testator that the property shall
form part of the CPG
Property acquired by right of redemption,
by barter, or by exchange with property
belonging to either spouse.
Plata v. Yatco, G.R. No. L-20825 (1964):
Plata purchased property when she was
single. When married, she and her
husband Bergosa co-signed a mortgage on
the property. Upon foreclosure, Bergosa
was sued for illegal detainer. A writ of
execution on the property was carried out
but Plata refused to leave the premises. SC
ruled that Plata cannot be held in
contempt. Property is not conjugal.
Her husband signing as co-mortgagor
does not convert it to CPG. She could
ignore execution because the decision was
for her husband alone.
 Property purchased with exclusive
money of either spouse

Lorenzo v. Nicolas, 1952 - Property

purchased by installment, paid partly with
conjugal funds and partly with exclusive
funds, if full ownership was vested before
the marriage [Art. 118, Family Code]. Even
if the installment is completed after the
marriage, the property is exclusive if
ownership was vested in one spouse before
the marriage.
 Presumption Art. 93, FC - All properties acquired Art. 116, FC - All property acquired during
during the marriage form part of the the marriage, whether made, contracted,
ACP, unless it be proven that they are or registered in the name of one spouse,
excluded. are presumed conjugal unless the contrary
is proven.
 Charges and Arts. 94 & 121-123, FC
Obligation
1. Support of the following:

a) Spouses;
b) Common children;
c) Legitimate children of previous marriage;
d) Illegitimate children – follow the provisions on Support; common property
liable in case of absence or insufficiency of the exclusive property of the
debtor-spouse, but the payment shall be considered as an advance on the share
of the debtor-spouse.

2. Expenses to enable either spouse to commence/complete a professional/vocational

course or activity for self-improvement;
3. Value donated or promised by both spouses in favor of common legitimate
children for the exclusive purpose of commencing/ completing a professional/
vocational course or activity for self-improvement;
4. Generally: all expenses incurred with the consent to the spouses or for the benefit
of the family.

If community property is insufficient, the Art. 95, FC - If community property is

spouses are solidarily liable for the insufficient, the spouses are solidarily
unpaid balance from their separate liable for the unpaid balance from their
properties except for: separate properties except for:

1. Debts contracted by either a) Debts contracted by either spouse

spouse before marriage which
have not redounded to the
benefit of the family;
2. Support of illegitimate children;
and
3. Liabilities incurred by either
spouse arising from crime or
quasi-delict.
Gambling losses of any kind (i.e., legal or
illegal) shall be borne by the losing
spouse’s separate property [Art. 95,
Family Code]
before marriage which have not
redounded to the benefit of the
family;
b) Support of illegitimate children;
and
c) Liabilities incurred by either
spouse arising from crime or
quasi-delict.
d) Gambling losses of any kind (i.e.,
legal or illegal) shall be borne by
the losing spouse’s separate
property
Art. 123, FC - If conjugal partnership
property is insufficient, the spouses are
solidarily liable for the unpaid balance
from their separate properties. Gambling
losses of any kind (i.e., legal or illegal)
shall be borne by the losing spouse’s
separate property.

DBP v. Adil, 1988 - Loan contracts signed

by both spouses are conjugal, and they are
jointly liable for payment, even if only one
spouse signs a subsequent promissory
note.

Ayala Investment v. Ching, G.R. No.

118305 (1998 - The Supreme Court ruled
 that the indirect benefits that might accrue
to a husband in signing as a surety or
guarantee in an agreement not in favor of
the family but in favor of his employer
corporation are not benefits that can be
considered as giving a direct advantage
accruing to the family. Hence, the
creditors cannot go against the conjugal
partnership property in satisfying the
obligation subject of the surety agreement.
A contrary view would put in peril the
conjugal partnership by allowing it to be
given gratuitously as in cases of donation
of conjugal partnership property, which is
prohibited.

 Ownership, Art. 96, 124, FC - The administration and enjoyment of the community/conjugal
administration, property shall belong to both spouses jointly.
enjoyment and
disposition of In case of disagreement, the husband’s decision shall prevail, subject to recourse
property to the court by the wife for a proper remedy, within 5 years from the date of contract

Art. 97, FC - Either spouse may, through De Ansaldo v. Sheriff of Manila, 1937 -
a will, dispose of his or her interest in the
Spouses are not co-owners of CPG during
community property. the marriage and cannot alienate the
supposed 1/2 interest of each in the said
However, the will should refer only to his properties. The interest of the spouses in
or her share in the community property. the CPG is only inchoate or a mere
expectancy and does not ripen into title
until it appears after the dissolution and
liquidation of the partnership that there
are net assets.
Disposition or encumbrance of conjugal property requires the following: Authority of
the court or written consent of the other spouse. The absence of such will render such
encumbrance void [Art. 96 and 124 (2), Family Code]. It is the same for ACP.
Art. 98, 125, FC - Donation of one spouse without the consent of the other is not
allowed.
Exception: Moderate donations to charity or on occasion of family rejoicing or
distress

Jader-Manalo v. Camaisa, 2002 - Mere awareness of a transaction is not consent.

Homeowners Savings & Loan Bank v. Dailo, 2005 - In the absence of (court)
authority or written consent of the other spouse, any disposition or encumbrance of
the conjugal property shall be void.

Cheesman v. IAC, 1991 - If, however, one of the spouses is an alien, the Filipino
spouse may encumber or dispose of the property w/o the consent of the former. The
property is presumed to be owned exclusively by the Filipino spouse.
 Dissolution of the Art. 99, 126, FC:
regime
1. Death of either spouse – follow rules in Art. 103
2. Legal separation – follow rules in Arts. 63 and 64
3. Annulment or judicial declaration of nullity – follow rules in Arts. 50 and 52

Judicial separation of property during marriage – follow rules in Arts. 134 to 138
 Rules on de facto General Rule: De facto separation does not affect the ACP/CPG.
separation
Exceptions:

1. Spouse who leaves the conjugal home without just cause shall not be entitled
to support; however, he/she is still required to support the other spouse and
the family

2. If consent is necessary for transaction but is withheld or otherwise

unobtainable, authorization may be obtained from the court

3. Support for family will be taken from the ACP/CPG

4. If ACP/CPG is insufficient, spouses shall be solidarily liable

 Efect of de facto If it is necessary to administer or encumber separate property of the spouse who left,
separation
 the spouse present may ask for judicial authority to do this.

If ACP/CPG is not enough and one spouse has no separate property, the spouse who
has property is liable for support, according to provisions on support.

Rules on Art. 101 & 128, FC - Present/aggrieved spouse may petition the court for:
abandonment
1. Receivership

2. Judicial Separation of Property

3. Authority to be the sole administrator of the absolute community, subject to

precautionary conditions that the court may impose.

A spouse is deemed to have abandoned the other when he or she has left the conjugal
dwelling without any intention of returning.

Spouse is prima facie considered to have abandoned the other spouse and the family if
he or she has:

1. Left for a period of 3 months

2. Failed to inform the other spouse of his or her whereabouts for a period of 3
months

Partosa-Jo v. CA, 1992 - Physical

separation of the spouses, coupled with
the husband’s refusal to give support to
the wife, sufficed to constitute
abandonment as a ground for an action for
the judicial separation of their conjugal
property.

Liquidation of assets Procedure [Art. 102, Family Code] Procedure [Art. 129, Family Code]
and liabilites
1. Prepare an inventory of assets of 1. Prepare an inventory of all
ACP and of spouses with market properties
values
2. Amounts advanced by CPG in
2. Debts and obligations are paid payment of personal debts and
with community property, and obligations shall be credited to the
separate debts and obligations CPG
not charged to ACP paid by
respective assets of spouses 3. Reimburse each spouse for the use
of his/her exclusive funds in the
(If obligations exceed the assets acquisition of property or for the
of the ACP, nothing is divided. value of his or her exclusive
Creditors can go after the property, the ownership of which
separate properties of the has been vested by law in the
spouses, which are solidarily conjugal partnership
liable for the deficiency )
4. Debts and obligations of CPG shall
be paid out of the conjugal assets,
3. Delivery of whatever remains in
otherwise both spouses are
their exclusive property
solidarily liable with their
exclusive property
4. The balance, or net remainder, is
divided equally between the
5. Remains of the exclusive
spouses, or in accordance to the
properties shall be delivered to
proportion agreed upon in the
respective owner-spouses.
marriage settlement, irrespective
of how much each brought into
6. Indemnification for
the community
loss/deterioration of movables
belonging to either spouse, even
5. If personal obligations of a
due to fortuitous event, used for
spouse exceed his/her separate
the benefit of the family
property, creditor can go after
the share of the spouse on the net
7. Net remainder of CPG shall
remainder of the ACP, without
constitute the profits which shall
prejudice to the provisions of law
be divided equally between
on forfeitures and delivery of
husband and wife except when:
presumptive legitimes

6. After covering all community

obligations and obligations of a) A different proportion or
division was agreed upon
 spouses, balance of separate
properties shall be delivered to in the marriage
respective spouses or their heirs, settlements
and they will also divide into two
equal shares whatever is left of b) There has been a
the community assets, without voluntary waiver or
prejudice to the provisions of law forfeiture of such share as
on forfeitures and delivery of provided in the FC
presumptive legitimes
c) Presumptive legitimes are
7. Presumptive legitimes are delivered to common
delivered to common children children

8. Conjugal dwelling goes to: d) Conjugal dwelling goes to:

a) Spouse with whom majority of  Spouse with whom majority of

common children choose to common children choose to remain
remain (below 7 y.o., = deemed (below 7 y.o. = deemed to have chosen
to have chosen the mother based the mother based on the tender years
on the tender years presumption) presumption)

 Whoever the court chooses in case of

b) Whoever the court chooses in lack of majority
case of lack of majority

Art. 103, FC - Rules in case of termination of marriage by death of one of the spouses.

1. The community property shall be liquidated in the same proceeding for the
settlement of the estate of the deceased spouse.

2. If no such judicial settlement proceeding is instituted, surviving spouse shall

liquidate the community property either judicially or extra-judicially, within
one year from the death of the deceased spouse.

1. If no liquidation is made within the period, any disposition or

encumbrance involving community property of the terminated
marriage shall be void.

2. Non-compliance with liquidation procedures would mean that a

subsequently contracted marriage will follow a regime of complete
separation of property.

Art. 104, FC - Procedure for liquidation of properties of two marriages.

1. Determine the capital, fruits, and income of each community upon such proof
as may be considered according to the rules of evidence.

2. In case of doubt as to which community the existing properties belong, they

shall be divided between two communities in proportion to the capital and
duration of each.

5. Separation of Property Regime

Art. 134, FC - If the spouses did not execute a written agreement regarding their property regime prior to the
marriage, they can no longer change it after the marriage ceremony has taken place unless they have secured
judicial approval.

When it applies Agreed upon in the marriage settlements by the spouses

Mandatory under Arts. 103 & 130, Family Code (subsequent marriages contracted by a
surviving spouse without judicial settlement of previous property regime)

Judicial separation of property (Voluntary or just cause)

Default property regime when there is reconciliation between spouses after judicial
separation of property

What it consists of Present or future property or both

Each spouse’s earnings from his or her own profession, business, or industry
 Natural, industrial or civil fruits of spouse’s separate properties

May be total or partial. If partial, property not considered separate is presumed to

pertain to the ACP
Liabilities Family expenses: Both spouses are liable in proportion to their income; if insufficient,
based on the current value of their separate properties

Creditors for family expenses: Spouses solidarily liable

Ownership, Spouses may own, dispose, possess, and administer separate estates without the
administration, consent of the other
enjoyment and
disposition Administration of exclusive properties may be transferred between spouses when:

1. One spouse becomes the other spouse’s guardian

2. One spouse is judicially declared an absentee

3. One spouse is given the penalty of civil interdiction

4. One spouse becomes a fugitive

Conveyance between the spouses is allowed under Art. 1490, Civil Code

Regime of Separation of Property - Each spouse has complete control and ownership of his or her own
properties which will include “all earnings from his or her profession, business or industry and all fruits, natural,
industrial or civil, due or received during the marriage from his or her separate property.” Expenses of the family
shall be shouldered by the spouses in proportion to their income, or, in case of insufficiency or default thereof, to
the current market value of their separate properties.

6. Property Regime of Unions Without Marriage

Art. 47, FC Art. 148, FC

Applicability Man and woman living together as husband and Man and woman living together as
wife, with capacity to marry (Art. 5, without any husband and wife, NOT capacitated
legal impediment) marry:

1. at least 18 years old 1. Under 18 years old

2. not violative of Art. 37 (incestuous void 2. Adulterous relationship
marriage) 3. Bigamous/ to polygamous
3. not violative of Art. 38 (void marriage by marriage
reason of public policy) 4. Incestuous marriages
4. not bigamous under Art. 37
5. Other void marriages due to absence of 5. Void marriages by reason
formal requisite of public policy under Art.
38

Salaries and wages Owned in equal shares Separately owned by parties

Properties acquired Remains exclusive, provided there is proof Remains exclusive

through exclusive
funds

Properties acquired Governed by rules on co-ownership Owned in common in proportion to

by both through work respective contribution
and industry

Properties acquired Owned in equal shares since it is presumed to No presumption of joint

while living together have been acquired through joint efforts
If one party did not participate in acquisition,
presumed to have contributed jointly, if the
former’s effort consisted in the care and
maintenance of family and household
acquisition. When there is evidence
of joint acquisition but none as to
the extent of actual contribution,
there is a presumption of equal
sharing

N.B. Neither party can encumber or dispose by

acts inter vivos his share in co-owned property
without the consent of the other party until
cohabitation is terminated.

forfeiture Where only one party to a void marriage is in If one party is validly married to
 good faith, share of party in bad faith is
forfeited:
In favor of their common children In case of
default of or waiver by any or all of the common
children or their descendants, each vacant share
shall belong to the respective surviving
descendants
In the absence of such descendants, such share
belongs to the innocent party
another, his/her share in the co-
owned properties will accrue to the
ACP/CPG of his/her existing valid
marriage.
If the party who acted in bad faith
is not validly married to another,
his/her share shall be forfeited in
the same manner as that provided
in Art 147.
The same rules on forfeiture shall
apply if both parties are in bad
faith.

7. Judicial Separation of Property

I. The Family

1. General Principles

J. The Family Home

1. General Principles

 In General

Art. 152, FC - The family home is the dwelling house where family resides and the land on which it is
sustained.

Art. 153, FC - When Deemed Constituted: The family home is deemed constituted on a house and lot from the
time it is occupied as a family residence.

Art. 156, FC - Limitations on the Family Home: The family home must be part of the properties of the absolute
community or the conjugal partnership, or of the exclusive properties of either spouse with the other’s
consent. It may also be constituted by an unmarried head of a family in his or her own property.

 Who May Constitute the Family Home

Art. 152, FC - The family home may be constituted:

1. Jointly by the husband and wife; or

2. An unmarried head of the family

Note: A person may constitute and be the beneficiary of only one family home - Art. 161, FC.

Kelley, Jr. v. Planters, 2008 - Under the Family Code, there is no need to constitute the family home
judicially or extrajudicially. All family homes constructed after the effectivity of the Family Code (August
3, 1988) are constituted as such by operation of law. All existing family residences as of August 3, 1988 are
considered family homes and are prospectively entitled to the benefits accorded to a family home under
the Family Code.

 Beneficiaries of the Family Home – Art. 154, FC:

1. The husband and wife, or an unmarried person who is the head of a family; and
2. Their parents, ascendants, descendants, brothers, and sisters whether the relationship be legitimate or
illegitimate, who are living in the family home and who depend on the head of the family for support.

Requisites to be a Beneficiary of the Family Home

1. The relationship is within those enumerated in Art. 150, Family Code

2. They live in the family home

3. They are dependent for legal support on the head of the family

Patricio v. Dario, 2006 - Descendants cannot be considered beneficiaries if they are supported by their
own parents and not by the ascendants who constituted the family home.
 Exemption from Forced Sale, Execution, Attachment

Art. 153, FC - Rule: The family home is exempt from the following from the time of its constitution and so long
as any of its beneficiaries resides therein:

a. Execution;
b. Forced sale;
c. Attachment.

Versola v. Mandolaria, 2006; Art. 160, FC - The proof that the house is the family home must be alleged
against creditors.
Note: The provisions of this Chapter (Arts. 152- 162, Family Code) shall also govern existing family
residences insofar as said provisions are applicable - Art. 162, FC.

 Sale of Family Home

Art. 158, FC - When the Family Home may be Sold: The family home may be sold alienated, donated,
assigned, or encumbered by the owner or owners thereof with the written consent of the person
constituting the same as the latter’s spouse and a majority of the beneficiaries of legal age. In case of
conflict, the court shall decide.

Requirements for the Sale, Alienation, Donation, Assignment, or Encumbrance of the Family Home - Art.
158, FC - The written consent of the following:

1. the person constituting it;

2. the spouse of the person constituting it; 3. the majority of the beneficiaries who are of legal age.

 When Terminated

The family home shall continue despite the death of one or both of the spouses or of the unmarried head of
the family:

1. for a period of ten (10) years; or

2. for as long as there is a minor beneficiary.

And the heirs cannot partition the same unless the court finds compelling reasons therefore. The rule
shall apply regardless of whoever owns the property or constituted the family home - Art. 159, FC.

Arriola v. Arriola, 2008 - Art. 159, Family Code imposes the proscription against the immediate partition
of the family home regardless of its ownership. This signifies that even if the family home has passed by
succession to the co-ownership of the heirs, or has been willed to any one of them, this fact alone cannot
transform the family home into an ordinary property, much less dispel the protection cast upon it by the
law. The rights of the individual co-owner or owner of the family home cannot subjugate the rights
granted under Article 159 to the beneficiaries of the family home.

K. Paternity and Filiation

1. Concepts of Paternity, Filiation, and Legitimacy

Art. 163, FC - The filiation of children may be (a) by nature or (b) by adoption. Natural filiation may be (a)
legitimate or (b) illegitimate.

Note: In Aquino v. Aquino [G.R. Nos. 208912 and 209018 (2021)], the Court used the terms “marital” and
“nonmarital” to replace the terms “legitimate” and “illegitimate” when referring to the children, as the latter terms
are pejorative terms when used to describe children based on their parents’ marital status.

Status Children who have this status Rights Effects on succession

Legitimate 1. Art. 164, FC - Conceived or
born during the valid
marriage of the parents.
2. Art. 164, FC - Conceived
through artificial
insemination.
3. Art. 43, FC - Children of a
subsequent marriage (after
declaration of presumptive
death) conceived prior to its
termination.
4. Art. 54, FC - Conceived or
born before the final
judgment of annulment
a) Bear the surnames of the Art. 888, FC -
father and the mother Legitimate children are
b) Receive support from entitled to 1/2 of the
parents, ascendants, and estate of the parent
brothers/sisters in divided amongst
proper cases themselves.
c) Entitled to legitimate
and other successional
rights - Art. 174, FC.
d) Claim legitimacy - Art.
173, FC.
 under Art. 45 or absolute
nullity under Art. 36
5. Art. 54, FC - Conceived or
born of the subsequent
marriage under Art. 53.
6. Art. 177, FC - Legitimated
children.
7. RA 11642 - Adopted Children

Illegitimate Art. 165, FC - Conceived and born a) Bear the surname of the Art. 176, FC - Each
outside a valid marriage. mother illegitimate child is
b) Bear the surname of the entitled to an amount
father if filiation has 1/2 the share of a
been expressly legitimate child.
recognized by the father
through: record of birth,
public document, or
private handwritten
instrument
c) Receive support Entitled
to successional rights
[Art 176, FC]
d) Establish illegitimate
filiation [Art 175, FC]

Legitimated Conceived and born outside a valid Same as Legitimate Child Same as Legitimate
marriage provided that: [Art. 179, Family Code] Child

1. At the time of conception: the

parents were not disqualified
to marry each other (unless
the impediment was minority
of either or both of them)
(Art. 177, FC) and
2. The parents subsequently
enter into a valid marriage
(Art. 178, FC)

Adopted Those adopted through RA 11642 Same as Legitimate Child Sec. 43, RA 11642
[Sec. 42, RA 11642]
In legal and intestate
succession, the adopter
and the adoptee shall
have reciprocal rights
of succession without
distinction from
legitimate filiation.

If the adoptee and

his/her biological
parents had left a will,
the law on
testamentary
succession shall govern

2. Legitimate Children

a) Who are Legitimate Children

 Who are the Legitimate Children?

1. Art. 164, FC - Conceived or born during the valid marriage of the parents.
2. Art. 164, FC - Conceived through artificial insemination.
3. Art. 43, FC - Children of a subsequent marriage (after declaration of presumptive death) conceived prior
to its termination. (This refers to those subsequent marriages which were terminated after the
reappearance of the spouse presumed dead.)
4. Art. 54, FC - Conceived or born before the final judgment of annulment under Art. 45 or absolute nullity
under Art. 36.
5. Art. 54, FC - Conceived or born of the subsequent marriage under Art. 53.
6. Art. 177, FC - Legitimated children.
7. RA 11642 - Adopted Children
 Natural/Biological - A child conceived or born during a valid marriage is presumed to belong to that marriage,
regardless of the existence of extramarital relationships - Liyao v. Liyao, 2002.

Artificial Insemination - Artificial insemination is the impregnation of a female with the semen from male
without sexual intercourse. The child conceived through artificial insemination with the consent of both
husband and wife is legitimate. The Family Code does not require, as a condition for the legitimacy of the
child, the impotence of the husband.

Note: The child must be born to the wife to be considered legitimate – Art. 164, FC.

b) Proof of Filiation of Legitimate Children

 Proof of Filiation is Necessary:

1. Where the child is born after 300 days following the termination of the marriage → Child has no status,
and whoever alleges legitimacy must prove it.
2. If the legitimacy of a child conceived or born in wedlock is impugned and the plaintiff has presented
evidence to prove any of the grounds provided in Art. 166 → proof of filiation may be used as a defense.

 Legitimate Children may Establish Their Filiation by any of the Following - Art. 172, FC

a) Primary Evidence (for voluntary recognition)

1. Their record of birth appearing in the civil registry or a final judgment.

2. An admission of his filiation by his parent in a public document or a private handwritten
instrument and signed by said parent

b) Secondary Evidence (for involuntary recognition) - Proof of open and continuous possession of status
as legitimate child.
c) Any other means stated by the rules of court or special laws.

Note: Only in the absence of primary evidence can secondary evidence be admitted

 Action for Claiming Filiation (Legitimate Children) – Art. 173, FC.

1. The child can bring the action during his or lifetime.

2. If the child dies during minority or in a state of insanity, such action shall be transmitted to his heirs, who
shall have a period of five years within which to institute the action.

3. The action commenced by the child shall survive notwithstanding the death of either or both of the
parties.

c) Rights of Legitimate Children

1. Bear the surnames of the father and the mother

2. Receive support from parents, ascendants, and brothers/sisters in proper cases
3. Entitled to legitimate and other successional rights - Art. 174, FC.
4. Claim legitimacy - Art. 173, FC.

 Right of Legitimate Children to use their Mother’s Surname - Alanis III v. CA, 2020: IMPORTANT

Art. 364, Civil Code states that legitimate children shall “principally” use the surname of the father, but
“principally” does not mean “exclusively.” There is no legal obstacle if a legitimate or legitimated child should
choose to use the surname of its mother to which it is equally entitled.

d) Grounds to Impugn Legitimacy

3. Illegitimate Children

a) Who are Illegitimate Children

GR – Art. 165, FC: Those Exceptions [Art. 54, Family Code]

conceived and born outside of a
valid marriage. 1. Children of marriages void under Art. 36 (psychological incapacity); and
2. Under Art. 53 (subsequent marriages which did not comply with Art. 52)

b) Proof of Filiation of Illegitimate Children

 Action for Claiming Illegitimate Filiation - Art. 175, FC - Illegitimate children may establish their
illegitimate filiation in the same way and on the same evidence as legitimate children.
 1. For actions based on primary evidence, the same periods stated in Art. 173 of Family Code
apply - lifetime of the child, will not be extinguished by death of either party.
2. For actions based on secondary evidence, the action may only be brought during the lifetime of
the alleged parent.

Art. 175, FC - The same kind of evidence provided in Art. 172 for establishing legitimate filiation may be
used to prove the filiation of illegitimate children, and the action for this purpose must be brought within
the same period and by the same parties as provided in Article 173. However, if the evidence to prove the
filiation is secondary, the action must be brought within the lifetime of the alleged parent.

 Primary Evidence

Eceta v. Eceta, 2004 - Signature of the father on the birth certificate is considered as an
acknowledgement of paternity and mere presentation of a duly authenticated copy of such certificate will
successfully establish filiation.

De Jesus v. Estate of Decedent Juan Gamboa Dizon, 2001 - The due recognition of an illegitimate child in
a record of birth, a will, a statement before a court of record, or in any authentic writing, is in itself a
consummated act of acknowledgement of the child, and no further court action is required.

 Secondary Evidence

Jison v. CA, 1998 - Rule 130, Sec. 40 [now Sec. 41] is limited to objects commonly known as family
possessions reflective of a family's reputation or tradition regarding pedigree like inscriptions on tombstones,
monuments, or coffin plates.

Heirs of Rodolfo Bañas v. Heirs of Bibiano Bañas, 1985 - "Su padre [Your father]" ending in a letter is only
proof of paternal solicitude and not of actual paternity. Signature on a report card under the entry of
“Parent/Guardian” is likewise inconclusive of open admission.

Gono-Javier v. CA, 1994 - Mere possession of status as an illegitimate child does not make an illegitimate
child recognized but is only a ground for bringing an action to compel judicial recognition by the assumed
parent.

Perla v. Baring, 2012 - To prove open and continuous possession of the status of an illegitimate child, there
must be evidence of the manifestation of the permanent intention of the supposed father to consider the child
as his, by continuous and clear manifestations of parental affection and care, which cannot be attributed to
pure charity.

Perla v. Baring, supra - Meanwhile, the lack of participation of the supposed father in the preparation of a
baptismal certificate renders this document incompetent to prove paternity. Baptismal certificates are per se
inadmissible in evidence as proof of filiation and they cannot be admitted indirectly as circumstantial
evidence to prove the same.

De Jesus v. Syquia, 1993 - By "open and continuous possession of the status of a legitimate child" is meant the
enjoyment by the child of the position and privileges usually attached to the status of a legitimate child, like
bearing the paternal surname, treatment by the parents and family of the child as legitimate, constant
attendance to the child's support and education, and giving the child the reputation of being a child of his
parents.

 Other Evidence

Agustin v. CA, 2005 - DNA evidence can be used as proof of paternity; Lim v. CA, 1975 - Marriage certificates
cannot be used as proof of filiation.

Gotardo v. Buling, 2012 - There are four significant procedural aspects of a traditional paternity action that
parties have to face: a prima facie case, affirmative defenses, presumption of legitimacy, and physical
resemblance between the putative father and the child. A prima facie case exists if a woman declares —
supported by corroborative proof — that she had sexual relations with the putative father; at this point, the
burden of evidence shifts to the putative father.

Further, the two affirmative defenses available to the putative father are:

(1) incapability of sexual relations with the mother due to either physical absence or impotency, or
(2) that the mother had sexual relations with other men at the time of conception.

c) Rights of Illegitimate Children

Illegitimate children shall use the surname andshall be under the parental authority of their mother, and
shall be entitled to support in conformity with this Code. The legitime of each illegitimate child shall
consist of one-half of the legitime of a legitimate child.
 Barcelote v. Republic, 2017 - It is mandatory that the mother of an illegitimate child signs the birth
certificate of her child in all cases, irrespective of whether the father recognizes the child as his or not. The
only legally known parent of an illegitimate child, by the fact of illegitimacy, is the mother of the child who
conclusively carries the blood of the mother.

Masbate v. Relucio, 2018 - Illegitimate children shall be under the parental authority of their mother.
Mothers are entitled to the sole parental authority of their illegitimate children notwithstanding the
father’s recognition of the child. In the exercise of that authority, mothers are consequently entitled to
keep their illegitimate children in their company, and the Court will not deprive them of custody, absent
any imperative cause showing the mother’s unfitness to exercise such authority and care.

Masbate v. Relucio, supra - The choice of a child over 7 years of age [Art. 213, Family Code] and over 10
years of age [Rule 99, Rules of Court] shall be considered in custody disputes only between married
parents as they are accorded joint parental authority over their common children [Art. 211, Family Code].
This choice is not available to an illegitimate child, because parental authority is given only to the mother
[Art. 176, Family Code], unless she is shown to be unfit or unsuitable.

d) Grounds to Impugn Filiation

4. Legitimated Children

a) Who May be Legitimated

 Rule: Legitimated children are illegitimate children who because of the subsequent marriage of their parents
are, by legal fiction, considered legitimate.

 Requisites for Legitimation: Art. 177, Family Code as amended by RA 9858 - The child must have been
conceived and born outside of wedlock; and The parents, at the time of the child's conception, were not
disqualified by any impediment to marry each other, or disqualified only because either or both of them were
below 18 years old.

b) How Legitimation Takes Place

 Procedure and Effects:

1. Art. 178, FC - Legitimation shall take place by a subsequent valid marriage between the parents. The
annulment of a voidable marriage shall not affect the legitimation.
2. Art. 180, FC - Effects of legitimation shall retroact to the time of the child’s birth.
3. Art. 181, FC - Legitimation of children who died before the celebration of the marriage shall benefit their
descendants.

 Rights of Legitimated Children - Art. 179, FC - Legitimated children have the same rights as those of
legitimate children.

c) Grounds to Impugn Legitimacy

5. Adopted Children

a) Domestic Administrative Adoption and Alternative Child Care Act (RA 11642)

Republic v. CA and Caranto, 1996 - Since adoption is wholly and entirely artificial, to establish the
relation the statutory requirements must be strictly carried out; otherwise, the adoption is an absolute
nullity.

Note: Republic Act No. 11642 (the Domestic Administrative Adoption and Alternative Child Care Act)
repealed RA 8552 and amended RA 8043. It took effect on January 21, 2022.Under RA 11642, the Inter-
Country Adoption Board is reorganized into the National Authority for Child Care. The duties, functions
and responsibilities of the ICAB, the DSWD and other government agencies relating to alternative child
care and adoption are transferred to the NACC.

b) Who May Adopt

a. Filipino Citizens [Sec. 21(a), RA 11642]

1. Of at least 25 years of age

2. With full civil capacity and legal rights
3. Of good moral character and has not been convicted of any crime involving moral turpitude
4. Emotionally and psychologically capable of caring for children
5. At least sixteen (16) years older than adoptee, except:

a) when adopter is the biological parent of the adoptee or

 b) the spouse of the adoptee’s parent or
c) the sibling or the adopted

6. in a position to support and care for his children in keeping with the means of the family
7. Has undergone pre-adoption services

b. Foreign Nationals

1. Are permanent or habitual residents of the Philippines for at least 5 years

2. Must possess the same qualifications as stated for Filipino nationals prior to the filing of the petition
3. Must come from a country with diplomatic relations with the Philippines and that the laws of the
adopter’s country will:

a) acknowledge the Certificate of Adoption as valid

b) acknowledge the child as a legal child of the adopters
c) allow entry of the child into such country as an adoptee

c. Guardians [Sec. 21(b), RA 11642]: With respect to their wards, after the termination of the guardianship and
clearance of his/her accountabilities
d. Foster parent [Sec. 21(c), RA 11642]: With respect to the foster child
e. Philippine government officials and employees [Sec. 21(d), RA 11642]

1. Deployed abroad, and

2. Are able to bring the child with them

c) Who May be Adopted - [Sec. 22, RA 11642]

a. Any child who has been issued by a CDCLAA

b. Legitimate child of one spouse by another
c. Illegitimate child by a qualified adopter to improve the child’s status to that of legitimacy
d. A Filipino of legal age if, prior to the adoption, said person has been consistently considered and treated,
for a period of at least 3 years, by the adopter(s) as his/her child since minority
e. A child whose previous adoption has been rescinded
f. A child whose biological or adoptive parent(s) has died, provided that no proceedings shall be initiated
within 6 months from the time of death of said parent(s)
g. A foster child

 Rights of an Adopted Child

In General: Sec. 42, RA 11642 - Except in cases where the biological parent is the adopter’s spouse, all
legal ties between biological parent and adoptee shall be severed, and the same shall then be vested on the
adopters.

Legitimacy: Sec. 41, RA 11642 - The adoptee shall be considered the legitimate son/daughter of the
adopters for all intents and purposes, and as such is entitled to all rights and obligations provided by law
to legitimate children born to them without discrimination of any kind. The adoptee is entitled to love,
guidance, and support in keeping with the means of the family.

Succession: Sec. 43, RA 11642 - In legal and intestate succession, the adopter 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.

Name: Under RA 11642, the adopter has the right to choose the name by which the child is to be known,
consistent with the best interest of the child.

Nationality - Adoption does not confer citizenship of the adopter to the adopted. Under Sec. 3, Art. IV
of the Constitution, Philippine citizenship may be lost/acquired [only] in the manner provided by law. The
adoption of an alien is not a means of acquiring Philippine citizenship. A Filipino adopted by an alien does
not lose his Philippine citizenship. The right to confer citizenship belongs to the State (political) and
cannot be granted by a citizen through adoption. Adoption creates a relationship between the adopter and
adoptee, not between the State and the adoptee.

 Instances and effects of Rescission

Under RA 11642, the adoption may be rescinded only upon the petition of the adoptee with the NACC, or
with the assistance of the SWDO if the adoptee is a minor or if the adoptee is over 18 but is incapacitated,
based on the following grounds: (Sec. 47, RA 11642)
 1. Repeated physical and verbal maltreatment by adopters despite having undergone counseling
2. Attempt on life of adoptee
3. Sexual assault or violence
4. Abandonment or failure to comply with parental obligations
5. Effects of Rescission [Sec. 53, RA 11642]

a. Restoration of parental authority of the adoptee’s biological parent(s) or the legal custody of the
NACC if the adoptee is still a child
b. Extinguishing of the reciprocal rights and obligations of the adopters and adoptee.
c. Cancellation of the new birth certificate of the adoptee as ordered by the court and restoration
of the adoptee’s original birth certificate
d. Reverting successional rights to its status prior to adoption but not only as of the date of
judgment of judicial rescission.
e. Vested rights acquired prior to judicial rescission shall be respected.

Note: Rescission contemplates a situation where the adoption decree remains valid until its termination.

 Inter-country Adoption (RA 8043, as amended by RA 11642) - 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: Under the new law, the Inter-Country Adoption Board is reorganized into the National Authority for
Child Care. The duties, functions and responsibilities of the ICAB, the DSWD and other government
agencies relating to alternative child care and adoption are transferred to the NACC.

 When Allowed : No child shall be matched to a foreign adoptive family unless it can be satisfactorily
shown that the child cannot be adopted locally [Sec. 11, RA 8043].

d) Effects of a Decree of Adoption (See Article Nos. 189-190 of the Family Code)

L. Support

1. What Comprises Support

Art. 194, FC - Support consists of everything indispensable for sustenance, dwelling, clothing, medical
attendance, education and transportation, in keeping with the financial capacity of the family.

Education includes a person’s schooling or training for some profession, trade or vocation, the right to
which shall subsist beyond the age of majority. Transportation includes expenses in going to and from
school, or to and from place of work.

2. Who are Obliged to Give Support – Art. 196, FC:

a. Spouses,
b. Legitimate ascendants and descendants,
c. Parents and their children (legitimate and illegitimate) and the children of the latter (legitimate and
illegitimate)
d. Legitimate brothers and sisters, whether of full or half-blood;
e. Illegitimate brothers and sisters, whether of full or half-blood Except when the need for support of one
(who is of age) is due to a cause imputable to his/her fault or negligence [Art. 196, Family Code]

Mutual Obligation to Support of Spouses

Note: Both legitimate and illegitimate children are entitled to support. The only difference is the source of
support which, for illegitimate children, is the parent’s separate properties. Where the illegitimate parent is
legally married to another person, their CPG or ACP cannot answer for support for the illegitimate child of one
of them unless the parent has no adequate separate property, in which case, support will be taken from the
CPG or ACP subject to reimbursement [Arts. 122 & 197, Family Code]

3. Source of Support

CPG or ACP shall answer a. spouse,

for the support of the: b. their common children, and
c. the legitimate children of their spouse [Arts. 94 & 121, Family Code].

The separate property of a. Legitimate ascendants,

the obligor shall answer for b. [All other] descendants, whether legitimate or illegitimate, and
the support of the: c. Brothers and sisters, whether legitimate or illegitimately related.

If no separate property: the ACP/CPG (if financially capable) shall advance the support, to be deducted
from the obligor’s share upon liquidation of such regime [Art. 197, Family Code].
4. Order of Support

 Article 199, Family Code. Whenever two or more persons are obliged to give support, the liability shall
devolve upon the following persons in the order herein provided:

a) Spouse
b) Descendant’s in the nearest degree
c) Ascendants in the nearest degree
d) Brothers and sisters

The order of liability among ascendants and descendants would be:

1. Legitimate children and descendants,

2. Legitimate parents and ascendants, and
3. Illegitimate children and their descendants

 In Case of Multiple Obligors

When the obligation to give support falls upon two or more persons, the payment of the same shall be
divided between them in proportion to their resources [Art. 200 (1), Family Code].
Also, in case of urgent need and by special circumstance, the judge may order only one obligor to furnish
support without prejudice to reimbursement from other obligors of the share due from them [Art. 200(2),
Family Code].

 In Case of Multiple Recipients - If there are multiple recipients and only one obligor, and the latter
has no sufficient means to satisfy all claims:

1. Observe order in Art. 199 as to whose claim shall be satisfied first;

2. But if the concurrent obligees are the spouse and a child subject to parental authority, the child shall be
preferred [Art. 200 (3), Family Code].

The above preference given to a child under parental authority over the spouse should prevail only if the
person obliged to support pays it out his separate property. So if the support comes from ACP or CPG, the
above rule of preference for the child does not apply.

 Support Given by a Stranger

Article 206, Family Code. When, without the knowledge of the person obliged to give support, it is
given by a stranger, the latter shall have a right to claim the same from the former, unless it appears that
he gave it without intention of being reimbursed. The stranger contemplated in this provision is one who
does not have any obligation to support the recipient.

 Person Obliged Refuses or Fails to Give Support

Article 207, Family Code. When the person obliged to support another unjustly refuses or fails to give
support when urgently needed by the latter, any third person may furnish support to the needy individual,
with the right of reimbursement from the person obliged to give support. This Article shall particularly
apply when the father or mother of a child under the age of majority unjustly refuses to support or fails to
give support to the child when urgently needed.

 Amount of Support - Arts. 201 & 202, FC - The amount of support is in proportion to the means of the
provider and the needs of the receiver, and can be reduced or increased if such circumstances change.

Contractual Support or that Given by Will

Art. 208, The excess in amount beyond that required for legal support shall be subject to levy on
attachment or execution.

Reason: The amount of support agreed upon in the contract or given in the will can be more than what
the recipient needs [Sempio-Diy].

Art. 208, FC - Furthermore, contractual support shall be subject to adjustment whenever modification is
necessary due to changes in circumstances manifestly beyond the contemplation of the parties.

 Manner and Time of Payment

Article 203, Family Code. The obligation to give support shall be demandable from the time the
person who has a right to receive the same needs it for maintenance, but it shall not be paid except from
the date of judicial or extrajudicial demand.
 Support pendente lite may be claimed in accordance with the Rules of Court. Payment shall be made
within the first five days of each corresponding month or when the recipient dies, his heirs shall not be
obliged to return what he has received in advance.

 Two Options to Fulfill Obligation to Give Support

1. Payment of the amount; or

2. Receiving and maintaining the recipient in the home of the provider

Requisites:

1. The obligor has his own home or domicile, and

2. There is no moral or legal reason which prevents the recipient from living in the obligor’s home or
domicile [Art. 204, Family Code].

 Renunciation and Termination - The obligation of spouses to mutual support lies in the existence of
marriage bonds. Once the marriage has been declared null, this obligation ceases.

De Castro v. Assidao-De Castro, 2008 - The Court held that the validity of marriage can be collaterally
attacked in an action for support. Although the suit is not instituted to directly address the issue of validity,
the Court deems it essential to the determination of the issue on support.

Under Art. 194, Family Code, the obligation to support a recipient’s education may continue even after the
person entitled has reached the age of majority.

 Support Pendente Lite

Art. 198, FC - Pending legal separation or annulment, and for declaration of nullity, support pendente lite for
spouses and children will come from the ACP/CPG. After final judgment granting the petition, mutual support
obligation between spouses ceases. However, in legal separation, the court may order the guilty spouse to give
support to the innocent spouse.

Note: In Par. 1, Art. 100, Family Code, de facto separation does not affect the ACP and the CPG, except that
the spouse who leaves the conjugal home without just cause shall not be entitled to support.

 Procedure in Applications for Support

Sec. 5, RA 8369 - Petitions for support and/or acknowledgement may be filed with Family Courts which
have original jurisdiction over such cases.

Sec. 7, RA 8369 - In cases involving violence among immediate family members living in the same
household, the court may order the temporary custody of children in all civil actions for their custody. The
court may also order support pendente lite, including deduction from the salary and use of conjugal home
and other properties in all civil actions for support.

Sec. 8(g), RA 9262 - A woman or her child experiencing violence may also be granted a protection order
which may include directing the respondent to provide support to the woman and/or her child if entitled
to legal support. An appropriate percentage of the income or salary of the respondent shall be withheld
regularly by the respondent’s employer for it to be automatically remitted to the woman. Failure to remit
and/or withhold or any delay in the remittance of support without justifiable cause shall render the
respondent or his employer liable for indirect contempt of court.

Perla v. Baring, 2012 - In case the filiation of a child claiming for support is disputed, the rules on proving
filiation apply. An order for support must be issued only if paternity or filiation is established by clear and
convincing evidence; the reason being that such order may create an unwholesome situation in the lives of
the parties.

M. Parental Authority

1. Concept of Parental Authority

What Comprises Parental Authority [Art. 209, Family Code]

1. Caring for and rearing of children for civic consciousness and efficiency, and;
2. Development of the moral, mental, and physical character and well-being of children.

What Characterizes Parental Authority [Art. 210, Family Code]

GR: Parental authority is not renounceable and non-transferable.

 XPN: In cases provided by law.

Who Exercises Parental Authority [Arts. 211-213, Family Code]

GR: Joint exercise by the father and the mother of a child – Art. 211 (1), FC.

XPN:

1. Art. 211, FC - In case of disagreement, the father’s decision prevails.

Exception to the Exception: If there is judicial order to the contrary.

2. Art. 212, FC - In case of absence or death of either parent, the parent present or alive.
3. Art. 213, FC - In case of separation of the parents, the parent designated by the court.
4. Art. 176, FC - In case of illegitimate children, the mother.

2. Substitute Parental Authority

 When Substitute Parental Authority is Exercised: Art. 214, FC - In case of death, absence, or
unsuitability of the parents

 Who Exercises substitute parental Authority (in order)

1. Art. 214, FC - The surviving grandparent.

a. Exception: Art. 214, FC - When several survive, the one designated by the court, taking into account
all relevant considerations.

2. Art. 216, FC: The oldest brother or sister, over 21 years of age.

3. Art. 216, FC: The child’s actual custodian, over 21 years of age.

3. Special Parental Authority

Who Exercises Special Parental Authority - Art. 218, FC:

1. The school (its administrators and teachers), or

2. The individual, entity, or institution engaged in child care

When is Special Parental Authority Exercised – Art. 218, FC:

1. While the child is under their supervision, instruction, or custody

2. During all authorized activities, whether inside or outside the premises of the school, entity, or institution

Substitute Parental Authority and Special Parental Authority, Distinguished

Difference Substitute Special

Who exercises Grandparents, oldest sibling, or Schools (administrators and teachers) or

court- appointed guardian
When exercised Only in case of death, absence, or
unsuitability of parents
How liable Subsidiarily liable for
damages caused by the minor
individuals, entities engaged in child care
Concurrent with parental authority or substitute
parental authority
Principally and solidarily liable for damages
caused the minor’s acts or omissions while under
their custody, supervision, or instruction

4. Effects of Parental Authority

 Effect of Parental Authority over the Child’s Person

Civil Liability: Art. 221, FC - Parents and other persons exercising parental authority shall be civilly liable
for the injuries and damages caused by the acts or omissions of their unemancipated children living in
their company and under their personal authority subject to the appropriate defenses provided by law.

Disciplinary Measures over the Child: Art. 223, FC - Persons exercising parental authority over a child
may petition the proper court of the place where the child resides for an order providing for disciplinary
measures over the child.

Note:
 1. The child shall be entitled to the assistance of counsel, either of his choice or appointed by the
court, and a summary hearing shall be conducted wherein the petition and the child shall be
heard.

2. However, if in the same proceeding the court finds the petitioner at fault, irrespective of the
merits of the petition, or when the circumstances warrant, the court may also order the
deprivation or suspension of parental authority or adopt such other measures as it may deem just
and proper.

For Persons Exercising Substitute Parental Authority - Art. 233 (1), FC: The person exercising substitute
parental authority shall have the same authority over the person of the child as the parents.

 Effect of Parental Authority over the Child’s Property

Joint Legal Guardianship - Art. 225 (1), FC: The father and the mother shall jointly exercise legal
guardianship over the property of their unemancipated child without the necessity of a court
appointment. In case of disagreement, the father’s decision shall prevail, unless there is judicial order to
the contrary.

Nature of Administration – Art. 226, FC: The property of the unemancipated child earned or acquired
with his work or industry or by onerous or gratuitous title shall belong the child in ownership and shall be
devoted exclusively to the latter’s support and education, unless the title or transfer provides otherwise.
The right of the parents over the fruits and incomes of the child’s property shall be limited primarily to the
child’s support and secondarily to the collective daily needs of the family.

Art. 225 (2), FC - Where the market value of the property or the annual income of the child exceeds
P50,000, the parent concerned shall be required to furnish a bond in such amount as the court may
determine, but not less than ten per centum (10%) of the value of the property or annual income, to
guarantee the performance of the obligations prescribed for general guardians.

The petition shall be considered as a summary special proceeding, with the ordinary rules on
guardianship being merely suppletory.

Except the Following, in which Case the Ordinary Rules on Guardianship shall Apply:

1. When the child is under substitute parental authority;

2. When the guardian is a stranger, or;
3. A parent has remarried.

 Trusts

If the parents entrust the management or administration of any of their properties to an unemancipated child,
the net proceeds of such property shall belong to the owner. The child shall be given a reasonable monthly
allowance in an amount not less than that which the owner would have paid if the administrator were a
stranger, unless the owner grants the entire proceeds to the child. In any case, the proceeds thus given in
whole or in part shall not be charged to the child’s legitime.

 Suspension or Termination of Parental Authority - When Permanently Terminated - Art. 228, FC:

a. Upon the death of the parents

b. Upon the death of the child, or
c. Upon the emancipation of the child.

Art. 229, FC: Unless Subsequently Revived by Final Judgment, there is Permanent Termination:

1. Upon adoption of the child;

2. Upon appointment of a general guardian;
3. Upon judicial declaration of abandonment of the child in a case filed for the purpose;
4. Upon final judgment of a competent court divesting the party concerned of parental authority

Note: Art. 232, FC - Also mandatory if the person exercising parental authority has subjected the child or
allowed him to be subjected to sexual abuse.

Art. 230-231, FC: Upon judicial declaration of absence or incapacity of the person exercising parental authority.
When Suspended.

1. Upon conviction of the parent or the person exercising the same of a crime which carries with it the
penalty of civil interdiction;
 2. Upon final judgment of a competent court in an action filed for the purpose or in a related case, if the
parent or the person exercising the same:

1. Treats the child with excessive harshness or cruelty;

2. Gives the child corrupting orders, counsel or example;
3. Compels the child to beg, or
4. Subjects the child or allows him to be subjected to acts of lasciviousness [Art. 231, Family Code].

Note: The grounds enumerated above are deemed to include cases which have resulted from culpable
negligence of the parent or person exercising parental authority [Art. 231, Family Code]

When Reinstated [Arts. 230-231, Family Code]

1. Automatically upon service of penalty (civil interdiction).

2. Automatically upon pardon or amnesty of the offender.
3. By judicial order, if the court finds that the cause therefore has ceased and will not be repeated [Art. 231,
Family Code].

Prohibition for Persons Exercising Special Parental Authority [Art. 233, Family Code]

In no case shall the school administrator, teacher or individual engaged in child care and exercising
special parental authority inflict corporal punishment upon the child.

PROPERTY, OWNERSHIP, AND ITS MODIFICATIONS

I. Classification of Property

A. Immovables – Art. 415, NCC

 Immovables by nature – things which cannot be moved from place to place. (LBCR-MQS)

1. Lands, Buildings, Roads, and Constructions of all kinds adhered to the soil.

2. Mines, Quarries, and Slag dumps, while the matter thereof, forms part of the bed, and waters either
running or stagnant.

 Immovables by incorporation – movables but are attached to an immovable in such a way as to be an integral
part.(TEF)

1. Trees, plants and growing fruits while they are attached to the land or form an integral part of an
immovable.

2. Everything attached to an immovable in a fixed manner, in such a way that it cannot be separated
therefrom without breaking the material or deterioration of the object.

Note: The code does not require that the attachment or incorporation be made by the owner of the
land. The only criterion being the incorporation with the soil.

3. Fertilizer actually used on a piece of land.

 Immovables by destination – essentially movables, but partake of the nature of an immovable because of the
purpose for which they have been placed in an immovable. (OMAD)

1. Statutes, reliefs, paintings or other objects for use or Ornamentation.

Requisites:

a. The objects must be placed in the immovable by the owner of the latter;

Note: if placed by a person other htan the owner (eg. Lessee, usufructuary), they must be acting as
the agent of the owner. Otherwise, the object will not attain the character of an immovable.
 b. With the intention to attach them permanently even if separation will not involve breakage or
injury.

Note: where the ornaments placed by the lessee are not to pass to the owner at the expiration of
the lease, they remain movables for chattel mortgage purposes. (Chattel mortgage was repealed
by Personal Property Act)

2. Machinery, receptacles, instruments or implements intended by the owner of the tenement for an
industry or works which may be carried on a building or on a piece of land and which tend to directly
meet the needs of the said industry or works.

Note: These machineries need not be attached to an immovable. Their immovable character depends
upon their use in the industry or works carried on in a building or on a piece of land.

The moment the machinery is no longer needed or used in the industry, they revert to being
movables.

E.g.
 Machineries of breweries used in the manufacture of liquor and soft drinks, though movable
in nature, are immobilized because they are essential to said industry.
 Gasoline station equipment and machinery.
 Machineries for chocolate-making industry.
 Sawmill machineries in a sawmill company.

Requisites:

a. The machinery must be placed by the owner of the tenement or his agent.
b. The industry or work must be carried on in a building or piece of land
c. The machinery must tend directly to meet the needs of the said industry or works.

3. Animal houses, etc. or breeding places of similar nature, and the animals in these places.

Requisites:

a. Placed by the owner or the tenant as the owner’s agent.

b. With the intention to have them permanently attached to the land.
c. Forming a permanent part of the land.

4. Docks, and structures which, although floating, are intended by their nature to remain at a fixed place
on a river, lake, or coast.

Note: Vessels are considered movables, although they partake the nature of real property, in view of
its importance in the world of commerce.

 By analogy – contacts for public works, servitude, and other real rights over immovable property.

B. Movables – Art. 416, 417, NCC

 Everything not included in Art. 415 (By exclusion)

 All things that can be transported from one place to another without substantial injury to the
immovable to which it is attached.
 Xpn: Unless expressly included under Art. 415 (E.g. – Machineries)
 Real property by any special provision of law is considered a movable.
 Forces of nature brought under the control of science (E.g. -Electricity, gas, heat, oxygen)
 Obligations and actions which have for their object movables or demandable sums (i.e. – any credit)
 Shares of stocks of agricultural, commercial and industrial entities, although may be real estate (e.g. –
stock certificate of a corporation)
 Other movables

1. Cultural Properties Preservation Act – Cultural properties like old buildings, shrines, documents
considered antiques, relic, or artifacts, etc.
2. A concession granted to a private person with the right of usufruct in a building erected on a lot
belonging to the municipality is personal property.

II. Bundle of Rights

A. Ownership
Public Dominion
Outside the commerce of man.
a. Not alienable or disposable.
b. Cannot be the subject of
torrens title.
c. Not susceptible to
prescription.
d. Cannot be burdened by any
voluntary easement.
Regalian Doctrine – Sec. 2, Art. XII
Consti:
With the exception of agricultural
lands, all other natural resources
shall not be alienated.
Classifications:
1. Administered by the State –
Art. 420.
a. Those intended for
public use.
b. Intended for public
service.
c. For the development of
national wealth
(minerals)
2. Administered by Municipal
Corporations (Art. 424, NCC)
GR: In the absence of a title deed
to any land claimed by the
Municipal corp as its own,
showing that it was acquired with
its private or corporate funds, the
presumption is that such land
came from the State upon
creation of the municipality.
Such property is held in trust for
the State for the benefit of its
inhabitants.
XPN: Those acquired with its
own funds in its private or
corporate capacity will be under
the ownership and control of the
political subdivision.
A municipal corp must prove that
they acquired the land with their
Patrimonial Property Private Ownership
Refers to al property belonging to
private persons and those belonging to
Properties held by the State in its the State and its political subdivisions
private capacity to attain economic that are patrimonial in nature.
ends.
Kinds:
1. Patrimonial property.
Properties of the public dominion 2. Property belonging to private
that are no longer intended for public persons.
use or public service.
Alienable public land converted to
private property through prescription:
Note: There must be an express
Alienable public land (Patrimonial
declaration by the State that the
property) held by a possessor –
public dominion property is no
Personally, through predecessors in
longer intended for public service,
interest, openly, continuously and
development of national wealth, or
exclusively – for 3o years.
that the property is converted into
patrimonial. Private land converted to Public
dominion through abandonment and
reclamation:
If there is an express declaration, the
Through gradual encroachment or
patrimonial property is subject to
erosion by the flow of the tide, private
alienation and disposition in the
property may become public if the
same way as properties owned by
owner appears to have abandoned the
private individuals.
land, and permitted it to be totally
eaten up by the sea as to become part
of the shore.
Conversion of Public dominion to
Patrimonial property – Heirs of
Malabanan v. Republic, 2009:
Public dominion, when no longer
intended for public use, shall form
part of the patrimonial property of
the State.
There must be an express declaration
by the State, either by Congress or by
the President, that the property was
converted into patrimonial property,
even though it was classified as
alienable or disposable.
 own corporate funds.

Note: Churches are outside the commerce of man. Thus, they are not private or public property.

Rights of an Owner:

1. Right to enjoy and dispose of a thing, without other limitations than those established by law.
2. Right of action against the holder and possessor of the thing in order to recover it.
3. Jus Utendi – Right to use and enjoy
4. Jus Fruendi – Right to the fruits
5. Jus Abutendi – Right to consume a thing by use
6. Jus Dispodendi – Right to alienate, encumber, transform, or even destroy the thing owned.
7. Jus Vindicandi – Right to recover possession of property based on a claim of ownership.
8. Jus Possidendi – Right to possess the property.
9. Jus Accessionis – Right to whatever is attached to the thing in such a way that they cannot be separated
without injury.
10. Jus Tresaurius – Right to hidden treasure.
11. Right to Exclude – Doctrine of Self Help (Art. 429)
12. Right to receive just compensation in case of expropriation (Art. 435)
13. Right of owner of the land to use its surface and everything under it, except natural resources (Art. 437)

B. Rights of Accession

1. General Principles

2. Accession Industrial

 For immovables

Accession Discreta - GR: To the owner belongs Natural fruits, industrial fruits, and civil fruits. (Art. 441, NCC)

XPN:

a. Possession in good faith (Art. 526 and 544, NCC)

b. Usufruct – Fruits belong to usufructuary (Art. 566, NCC)
c. Lease – Fruits belong to lessee in lease of agricultural land (Art. 1680, NCC) The lessor receives the
rentals as civil fruits.
d. Antichresis (Art. 2132, NCC)

Accession Continua - Right of owner over everything that is incorporated or attached thereto either naturally or
artificially (Art. 440, NCC): Building, Planting or Sowing on land owned by another.

GR: Whatever is built, planted or sown on the land of another and the improvements or repairs made thereon,
belong to the owner of the land (Art. 445, NCC)

XPN: Builder, Planter or Sower in good faith.

Definition/Requisites Rights Liabilities

1. Asserts title to the land If Land owner is in GF:

on which he builds.
1. Limited right of removal
(He must be a (Can only be resorted to if no
possessor in the injury can be inflicted on the
work constructed)
B/P/S concept of owner)
in GF 2. Right to reimbursement for
2. He is unaware that
the value of materials.
there exists in his title
or mode of acquisition
If Land owner is in BF:
any flaw which
invalidates it. 1. Absolute right of removal
(even if there will be injury)

2. Right to reimbursement for

the value of materials.

B/P/S One who has knowledge of any
in BF flaw or defect in his title or
mode of acquisition (Art. 526,
NCC)
He is a possessor in bad faith if
at the time he B/P/S, he knew
that:
1. He does not have title
to the land and thus
does not have the right
to build thereon. Or
2. He has no permission
to B/P/S on the land
which he possesses but
does not own.
Note: Bad faith leads
to liability for damages
and the loss of the
works or the
improvement without
right to indemnity.
(Art. 449, NCC)
LO in One who has no knowledge of
GF B/P/S or one who opposes to
such.
3. Right to damages in either
case.
If LO is in GF:
Recover necessary expenses for
preservation of the land.
1. Pay damages to land
owner
2. Lose materials without
right to indemnity.
3. No right to refuse to buy
the land.
If B/P/S is in GF: Shall pay the value of materials. –
no one shall be unjustly enriched
1. Acquire improvements after at the expense of another.
paying BPS for their value.
2. Oblige the one who B/P to
pay the price of the land
unless its value is
considerably more than that
of the Building or Trees, and
the one who sowed, proper
rent.
If the value is considerably
more, then the court can
force the parties to enter into
a forced lease. (Art. 448,
NCC)
If B/P/S in in BF: Collect damages
and option to -
1. Right to acquire
improvements without
paying indemnity.
2. Sell the land to BP or collect
rent from the Sower unless
value of the improvements is
higher in which case there
will be a forced lease.
3. Order demolition of
 improvements or restoration
of land to its former
condition at the expense of
BPS.
Shall pay for:

LO in If the B/P/S was done with his 1. Value of materials

BF knowledge and without 2. Damages
opposition on his part. (Art.
453, NCC) LO has no option to sell the land
and cannot compel BPS to buy the
land without the latter’s consent.

3. Accession Natural - Naturally incorporated – Art. 457-465, NCC.

Immovables:

a. Alluvium – Art. 457, NCC – Soil is gradually deposited on banks adjoining the river. Requisites: GCA

1. Deposit of soil or sediment is Gradual.

2. As a result of the action of the currents of the waters of the river and should have no human
intervention.
3. Land where the accretion takes place is adjacent to the banks of the rivers.

Republic v. Tongson, 2020 - Accretion which the banks of rivers may gradually receive from the
effect of the current become the property of the owners of the banks. However, such piece of land is
not considered automatically registered just because the lot that receives such accretion is covered by
Torrens title. Ownership of a piece of land is one thing; registration under the Torrens system of that
ownership is another. Thus, such piece of land, absence of registration, may still be acquired through
prescription by 3rd persons.

What is not considered Alluvium – Art. 458, NCC.

1. Deposits due to human action or intervention.

2. Deposits due to abrupt or unanticipated floodings brought about by extreme weather conditions.
3. When the sea moved towards the estate and the tide invaded it, the invaded property became
foreshore land and passed to the realm of public domain. (Baguio v. Heirs of Abello, 2019)

b. Avulsion – Art. 459, NCC – a known portion of land is segregated from one estate by the forceful current
of a river, creek or torrent and transferred to another.

Requisites: RCT-AI

1. The segregation and transfer is caused by the Current of a river, creek or torrent.
2. The segregation and transfer must be sudden or abrupt.
3. The portion of oland transported must be known or identifiable.

Note: The ownership of the detached property is retained by the owner provided that he removes the
same within 2 yeas from detachment. (Art. 459, NCC)

c. Uprooted trees – Art. 460, NCC – owner retains ownership if he makes a claim within 6 months.

d. Change of course of river – Art. 461-462, NCC.

Effects:

1. Owners whose lands are occupied by the new course of the river automatically become owners of the
old bed, in proportion to the area they lost (Art. 461, NCC)

Owners of the land adjoining the old bed are given the right to acquire the same by paying the value of
the land, not exceeding the value of the land invaded by the new bed. (Art. 461, NCC)

The owners of the new riverbeds are not entitled to damages.

2. The new bed opened by the river on a private estate shall become of public dominion. (Art. 462, NCC)

Where the bed simply dries up, the abandoned riverbeds belongs to the State as property of public
dominion. (Art. 502)

Movables:

Conjunction/Adjunction – Art. 466-471, NCC .

 Conjunction - Union, without bad faith, of two movable things belonging to different owners in such a
way that they form a single object. The owner of the principal thing acquires the accessory after
indemnifying the owner of the latter for its value.

GR: When the things united can be separated without injury, their respective owners may demand
separation (Art. 469, NCC)

XPN: The owner of the accessory may demand the separation of the things united even if there will be
injury if the accessory is more precious than the principal thing (Art. 467 and 469, NCC)

Adjunction – Union of two movable things belonging to different owners in such a way that they form a
single object, but each of the component things preserves it value.

Requisites:

1. There are two movables belonging to different owners.

2. They are united in such a way that they form a single object.

3. They are so inseparable that their separation would impair their nature or result in substantial injury
to the other component.

Owner of Principal object Acquires the thing with the duty to indemnify the owner of the accessory. (Art.
in GF: 466, NCC)

Owner of Principal object Owner of the accessory has the right to choose between:
in BF:
1. Receiving payment from the owner of the principal the value of
accessory. Or

2. The accessory b separated even if it would be necessary to destroy the

principal.
Owner of Accessory object Has a right to demand separation even though there may be damage if the
in GF: accessory is more valuable.

Rules in determining the Principal thing: Art. 467-468, NCC.

a. That which the other has been united as an ornament or for its use or perfection.
b. IF it cannot be determined by applying #1, the one with greater value.
c. If the values are equal, the one with greater volume.

Note: In paintings and sculpture, writings, printed matter, engraving and lithographs, the board, metal,
stone, canvas, paper or parchment shall be deemed the accessory thing.

When separation is allowed: Art. 469, NCC.

a. When the separation will not cause any injury, the respective owners can demand separation.
b. When the accessory is more precious than the principal thing, the owner of the accessory may
demand separation, even though the principal thing may suffer.

Note: Owner who caused the union shall bear the expenses for separation even if he acted in good faith.

Commixtion/Confusion – Art. 472-473, 475, NCC.

Commixtion: Mixture of solid things. Vs. Confusion: Mixture os liquid things.

a. Co-ownership is based on proportional value if caused by:

1. The will of the parties

2. Chance, and injury will result if things are separated, or
3. Will of only one owner, but in good faith.

b. If caused by the will of one party in bad faith:

1. He forfeits the thing belonging to him.

2. He must pay damages.
3. If the mixture is made with the knowledge, but without the objection of the other owner the
parties will be considered as if they acted in good faith – Art. 470, NCC.
 Note: Art. 456, NCC – Good faith in accession does not necessarily exclude negligence, which
gives rise to damages.

Specification – Art. 474-475, NCC.

Takes place when the work of a person is done on the material of another, and such material, in
consequence of the work itself, undergoes a transformation.

It is the transformation of another’s materialby application of labor, into a thing of a different kind. (E.g.
Turning grapes into wine)

Worker/Maker in GF – The W/M owns the thing after indemnifying the owner of the materials for the value
Art. 474, NCC thereof.

XPN: If the material is more valuable or more precious than the new thing, the owner
of the material may:

1. Appropriate the new thing to himself after paying indemnity for the value of
the work.
2. Demand indemnity for the material.

Worker/Maker in BF – If W/M is in BF but the Owner of materials is in GF, the latter may:
Art. 474 (3), NCC
1. Appropriate the new thing without paying the maker.

XPN: if the value of the work, for artistic and scientific reasons, is
considerably more than that of the material, the 2nd option shall apply.

2. Demand the maker to indemnify him for the value of the materials and
damages.
Owner of the material
was in bad faith, Art.
470, NCC The W/M in GF may:

1. Appropriate the new thing without paying the owner of the material. Or
2. Require the owner to pay him the value of the thing, his work, or labor, with
damages.

C. Actions to Recover Ownership and Possession of Property

1. Accion Reivindicatoria - An action for recovery of ownership and includes the Jus utendi and Jus
Fruendi brought in RTC.

Requisites:

a. The property must be identified.

b. The plaintiff must rely on the strength of his title (He who asserts, not he who denies, must prove –
Art. 434)

2. Accion Publiciana - An ordinary civil proceeding to determine the better right of possession of realty
independently of title.

It refers to an ejectment suit filed after the expiration of one year from the accrual of the cause of action or
from unlawful withholding of possession of the realty.

GR: The objective of Accion Publiciana is to recover possession only, not ownership.

XPN: if the parties raised the issue of ownership, the courts may pass upon the issue to determine who
between or among the parties has the right to possess the property.

3. Accion Interdictal

Forcible Entry Unlawful Detainer

The possession was already unlawful from the The possession was first lawful, but became illegal.
time of entry.
 Lawful possessor deprived through: FISTS Possessor refused to vacate upon demand by the owner.

1. Force Note: Legal possession (By permission/tolerance) becomes

2. Intimidation unlawful upon failure to vacate.
3. Stealth
4. Threats
5. Strategy

Period to bring action: 1 year from dispossession Period to bring action: 1 year from the last demand to
(FIT) or from knowledge of dispossession (SS) vacate.

4. Quieting of Title - Requisites: (Art. 476, NCC)

a. Plaintiff has a legal or equitable title to or interest in the real property (he need not be in possession of
the property).
b. There is an instrument, claim, encumbrance of proceeding which casts a cloud, doubt, question or
shadow.
c. Such cloud is adverse to the owner’s title to or interest in the real property.

d. The deed/encumbrance claimed to be casting cloud on Plaintiff’s title must be shown to be in fact
invalid or inoperative despite its prima facie appearance of validity or legal efficacy.

Plaintiff must return to the defendant all benefits he may have received from the latter, or reimburse him
for expenses that may have redounded to his benefit (Art. 479, NCC)

GR: An action to quiet title applies only to real property.

XPN: Some personal properties like vessels and stock certificates which partake of the nature of real
property, or when they are considered as real property because of special registration requirements.

Prescription of Action
Condition Effect on prescription
In possession of the Property Action does not prescribe

Not in possession but Plaintiff is a possessor with real Prescribes in 10 years

right

Not in the possession but Plaintiff is owner of the Prescribes in 30 years

property

Note: An action to quiet title may be defeated by a claim of ordinary or extraordinary acquisitive prescription by
the defendant.

Action to recover movable property – Replevin.

Requisites:

1. The applicant must show that he is the owner of the property or that he is entitled to possession thereof.
2. Particular description of the property claimed.
3. That the property is wrongfully detained by the adverse party.
4. That the property has not been distrained or taken pursuant to law or placed under custodia legis.
5. If the property is seized pursuant to law, or under attachment, the applicant must show that it is exempt
from the seizure.
6. The actual market value of the property.

Limitations on Ownership:

General limitations:

1. Taxation
2. Eminent Domain
3. Police Power

Specific limitations:

1. Legal servitudes.
2. Must not injure the rights of a third person (Art. 431, NCC)
3. Actions in a state of necessity (Art. 432, NCC) – owner of the thing has no right to prohibit the
interference of another with the same, if the interference is necessary to avert an imminent danger and
the threatened damage is much greater compared to the damage arising to the owner from the
interference.
 Note: the owner may demand from the person benefited, indemnity for damage to him.

4. Nuisance – A/O, establishment, business, condition of property, or anything else which:

a. Injures or endangers the health or safety of others.

b. Annoys or offends the senses.
c. Shocks, defies or disregards decency or morality.
d. Obstructs or interferes with the free passage of any public highway or street, or any body of water.
e. Hinders or impairs the use of property.

5. Limitations imposed by the owner himself – valid provided they are not contrary to law.
6. Limitations imposed by the party transmitting the property either by contract or will.

D. Co-Ownership

Requisites: POE

a. Plurality of owners.
b. Object must be an undivided thing or right.
c. Each co-owner’s right must be limited only to his ideal or abstract share of the physical whole.

Characteristics:

a. There are two or more co-owners.

b. There is a single object which is undivided.
c. There is no mutual representation by the co-owners.
d. It exists for the common enjoyment of co-owners.
e. It has no distinct legal personality.

Only limitation: Silvia v. Lo, 2021:

Each co-owners hold the property pro-indiviso and exercises his or her rights with the entire property.

Thus, each co-owner may use and enjoy the property with no other limitation than that he shall not inure
the interests of his co-owners.

Sources of Co-ownership

1. Law a) Cohabitation (Co-ownership between common law spouses)

b) Purchase creating implied trust.
c) Easement of party wall.
d) Condominium law:
e) Co-ownership of the common areas by holders of unit.

2. Contract
a. In general – Art. 494, NCC
b. Universal partnership – Art. 1779, NCC
c. Associations – Art. 1775, NCC

3. Intestate succession
Co-ownership between the heirs before the partition of the estate – Art.
1078, NCC.

Donations made to several persons jointly:

4. Testamentary
disposition or donation GR: When a donation is made to several persons jointly, it is understood to
inter vivos be in equal shared, and there shall be no right of accretion among them.

XPN: The donor provides otherwise. (Art. 753, NCC)

Donations made to spouses jointly:

GR: In donations to spouses jointly, right of accretion is presumed.

XPN: The donor provides otherwise.

Note: A donor or testator may prohibit partition for a period which shall not
exceed 20 years.

5. By Fortuitous event or
by Chance a. Co-ownership between owners of 2 things that are mixed by chance
or by will of the owners – Art. 472, NCC.

b. Hidden Treasure – Art. 438, NCC.

 When the discovery is made on the property of another, or of the
State, and by chance, ½ shall be allowed to the finder.

Harvesting and fishing: Co-ownership by two or more persons who have

6. By occupation seized a res nulius thing. – Art. 713, NCC.

Hidden treasure – Art. 439, NCC – Any hidden and unknown deposit of money, jewelry or other precious
objects, the lawful ownership of which does not appear.

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

XPN: Art. 438, NCC – Finder of hidden treasure is entitled to ½ if:

1. Finding is by chance.
2. Finder is not co-owner of the property where it is found.
3. Finder is not trespasser.
4. Finder is not an agent of landowner.
5. Finder is not owner of the land, building or property.

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

For purposes of hidden treasure, a usufructuary is considered a stranger to the property. The naked owner
gets the owner’s share.

1. Distinctions Between Right to Property Owned in Common and Full Ownership Over the
Ideal Share

Rights to property co-owned Full ownership over the ideal Share.

1. Right to share in the benefits as well as the charges

– Art. 485, NCC. Art. 493, NCC – Right to full ownership of his
part and of the fruits and benefits pertaining
a. Proportionality: The share of the co-owners thereto.
shall be proportional to their respective
interests. Any stipulation to the contrary is As a result, the co-owner has the right to:
void. a. Alienate
b. Assign
b. Presumption of equal share: The portions c. Mortgage
belonging to the co-owners in the co-ownership d. Substitute another person in its
shall be presumed equal, unless the contrary is enjoyment.
proved.

2. Right to use the thing owned in common – Art.

486, NCC.

GR: Each co-owner may use the thing owned in

Note: Actions above can only pertain to the co-
common.
owner’s ideal share prior to partition.
Limitations:

a. The use must be in accordance with the XPN: When personal rights are involved.
purpose for which the co-ownership is
intended.

b. The use of the co-owned property must be in

such a way as not to injure the interest of co-
ownership.

c. In such a way as not to prevent the other co-

owners from using it according to their right.

3. Right to bring an action in ejectment – Art. 487,

NCC.

Actions contemplated: All cases for recovery of

possession. The action is considered filed for the
benefit of all the co-owners.
 Clemente v. Republic, 2019:

A co-owner may bring such an action without

joining all the other co-owners as co-plaintiffs
because the suit is presumed to have been filed for
the benefit of his co-owners.

If the plaintiff/co-owner claims to be the sole

owner, the action should be dismissed.

4. Right to compel other co-owners to contribute to

the expenses of preservation and to the taxes – Art.
488, NCC.

GR: Each co-owner shall have a right to compel the

other co-owners to contribute:

a. To the necessary expenses (incurred for the

preservation for the thing or right).

If practicable, he must first notify his co-owners

of the necessity for such repairs – Art. 489,
NCC.

b. To the taxes – Art. 488, NCC

XPN: CO-owner no longer has to pay if he

renounces his undivided interest as equivalent to
his share of expenses and taxes.

Xpn to XPN: No waiver shall be made if prejudicial

to co-ownership – Art. 488, NCC.

a. Expenses to improve or embellish the thing

shall be decided upon by majority.

b. As for the expenses for pure luxury or mere

pleasure, these are not refundable for not
serving purposes of preservation – Art. 548,
NCC.

5. Right to reimbursement for necessary repairs – Art.

488-489, NCC.

GR: A co-owner has the right to compel the other

co-owners to contribute to the expenses of
preservation, maintenance, or necessary repairs of
the thing or right owned in common and to the
taxes.

Requirement of notice: If practicable, the co-owner

must first notify the co-owners of the necessity for
the repairs – Art. 489, NCC.

XPN to Notice requirement:

if impracticable or where the repairs are very

urgent, and the other co-owners are in remote
places and cannot be reached by an ordinary means
of communication.

Note: Lack of notice even if practicable, does not

exempt other co-owners to contribute.

The co-owner who advanced them has the burden

of proving that they were properly incurred.

6. Right to oppose alterations – Art. 491, NCC.

 GR: Unanimous consent: None of the co-owners
shall, without the consent of the others, make
alterations in the thing owned in common, even
though benefits for all would result therefrom.

Rationale: Alteration is an act of ownership.

Alteration – A change in the nature or use of a

thing; It contemplates a permanent change.

E.g. – The construction of a house on the co-owned

property is an alteration.

Mortgage, donation, or sale of a portion or the

whole property co-owned.

XPN: If the withholding of the consent by one or

more co-owners is clearly prejudicial to the
common interest, the courts may afford adequate
relief.

7. Right to participate in the administration of the

property owned in common.

GR:

a. For the administration and better enjoyment of

the thing owned in common, the resolutions of
the majority of the co-owners shall be binding –
Art. 492, NCC.

b. There shall be no majority unless the resolution

is approved by the co-owners who represent the
controlling interest in the object of co-
ownership – Art. 492, NCC.

XPN to acts of administration only by majority:

a. If there be no majority; or
b. If the resolution of the majority is seriously
prejudicial to those interested in the property
owned in common.

Effect: the court will intervene – the court, at the

instance of any interested party, shall order such
measures as it may deem proper, including the
appointment of an administrator.

Examples of acts seriously prejudicial:

a. Call for a substantial change of the thing.

b. Authorizing leases, loans and other contracts
without the necessary security, thereby
exposing the property to serious danger.
c. Continued employment of an administrator
who is guilty of fraud or negligence in his
management.

8. Right to Partition (see below) – Art. 494, NCC.

9. Right to Redemption (See below) – Art. 1619, NCC.

2. Contributions for Expenses

a. Renunciation of share – Art. 488: A co-owner may exempt himself from the payment of expenses of
preservation by renouncing his undivided interest in the co- ownership as may be equivalent to his share
in the necessary expenses and taxes.
 A co-owner who has not waived his share in the co-ownership may be compelled to pay his share in the
cost of its maintenance, but he may not be compelled to renounce. Waiver of renunciation is not allowed
if it is prejudicial to the co-ownership.

b. Repairs for preservation, embellishments or improvements – Art. 489, 492, NCC.

Requires consent of majority of co-owners representing the controlling interest in the undivided thing.

Note: The rules under Art. 492 are applicable, so judicial intervention may be resorted to.

c. Rules on multi-story house – Art. 490, NCC.

Applies when:

 The different stories of a house belong to different owners;

 The titles of ownership do not specify the terms under which they should contribute to the
necessary expenses; and
 There exists no agreement on the subject.

Part of the House Manner of contribution

Main and party walls, the roof, and the All owners contribute in proportion to the value of the story
other things used in common belonging to each.

Floor of the entrance, front door, common All owners contribute pro rata or equally
yard, and sanitary works common to all

The floor of each co-owner’s story Each owner bears the cost of maintaining the floor of his story.

Stairs Stairs from the first entrance to the first story – pro rata sharing of
all owners except the owner of the ground floor.

3. Redemption

Right to redemption – Art. 1619, NCC. Legal redemption: the right to be subrogated, upon the same terms and
conditions stipulated in the contract, in the place of one who acquires a thing by purchase or dation in payment, or
by any other transaction whereby ownership is transmitted by onerous title.

GR: A co-owner of a thing may exercise the right of redemption in case the shares of all the other co-
owners or of any of them are sold to third person – Art. 1619, NCC.

XPN: When the property is already partitioned and divided among the parties, the right of redemption
may no longer be exercised – Avila v. Sps. Barabat, 2006.

4. Partition

Right to partition – Art. 494, NCC. Spouses Marcos v. Heirs of Bangi, 2014:

Partition is the separation, division and assignment of a thing held in common among those to whom it may
belong. Every act which is intended to put an end to indivision among co-heirs and legatees or devisees is
deemed to be a partition.

Partition may be inferred from circumstances sufficiently strong to support presumption. Thus, after a long
possession in severalty, a deed of partition may be presumed.

GR:

a. No co-owner shall be obliged to remain in the co-ownership.

b. Each co-owner may demand at any time the partition of the thing owned in common, insofar as his share
is concerned.

Note: A creditor or assignee of a co-owner may take part in the division of the thing owned in common
and object to its being effected without their concurrence.

But they cannot impugn any partition already executed unless there has been fraud or in case it was made
notwithstanding a formal opposition to prevent it, without prejudice to the right of the debtor or assignor
to maintain its validity – Art. 497, NCC.

XPN: Co-owners cannot exercise their right to partition when:

 a) There is an agreement to keep the thing undivided for a certain period of time, not exceeding 10 years –
Art. 494, NCC.

b) A donor or testator prohibits partition for a period which shall not exceed 20 years – Art. 494, NCC.

c) Neither shall there be any partition when it is prohibited by law – Art. 494, NCC.

d) When physical partition would render the thing unserviceable for the use for which it is intended – Art.
495, NCC.

Rule in partition if the thing owned in common is indivisible – Art. 498, NCC.

a. The co-owners can agree that it be allotted to one of them, and the latter will indemnify the others.

b. If they cannot agree, the thing shall be sold and its proceeds distributed.

Art. 499, NC - GR: No prescription shall run in favor of a co-owner or co-heir against his co-owners or co-heirs so
long as he expressly or impliedly recognizes the co-ownership.

XPN: Elements for prescription to run in favor of co-owner:

a. He has performed unequivocal acts of repudiation amounting to an ouster of the other co-owners.

b. Such positive acts of repudiation have been made known to the other co-owners.

c. The evidence thereon must be clear and convincing.

Samples of acts of repudiation:

a. Filing of actions in court like quieting of title, accion reivindicatoria and other similar suits against a
co-owner.

b. Co-owner who causes cancellation of the existing title and petitions for an issuance of a new title in
his favor.

c. Co-owner who permanently fences the property and hires security personnel to prevent other co-
owners from entering the property.

Termination or extinguishment of co-ownership:

a. Total destruction of the thing owned in common.

b. Merger of all interests in one person.

c. Acquisitive prescription.

This is a mode of acquiring ownership by a possessor through the requisite lapse of time. It may be
ordinary or extraordinary [Art. 1117, Civil Code].

Ordinary Acquisitive prescription requires possession of things in good faith and with a just title for the
time fixed by the law [De Leon]. Extraordinary Prescription is the opposite. No good faith or just title is
required, but long possession under Art. 1132 (2)

d. Partition

1. Extrajudicial partition – The agreement may be oral or written, done outside of court.
2. Judicial partition – Governed by the Rules of Court insofar as they are consistent with the Civil
Code [Art. 496, Civil Code].

Action for Partition Will Determine: Heirs of Cesar Marasigan v. Marasigan, 2008.

1. Whether or not the plaintiff is indeed a co-owner of the property

2. How the property will be divided between the plaintiff and defendant

Incidents of Partition

1. Mutual accounting for benefits received and reimbursement for expenses made [Art. 500, Civil Code].
2. Payment of damages by each co-owner caused by reason of his negligence or fraud [Art. 500, Civil
Code].
3. Liability of each co-owner for defects of title and quality of the portion assigned to each of the co-
owners [Art. 501, Civil Code].

Effects of Partition
 1. Confers exclusive ownership of the property adjudicated to a co-heir [Art. 1091, Civil Code].
2. Co-heirs shall be reciprocally bound to warrant the title to, and the quality of each property
adjudicated [Art. 1092, Civil Code].
3. Reciprocal obligation of warranty shall be proportionate to the respective hereditary shares of co-
heirs [Art. 1093, Civil Code].
4. An action to enforce the warranty must be brought within 10 years from the date the right of action
accrues [Art. 1094, Civil Code].
5. The co-heirs shall not be liable for the subsequent insolvency of the debtor of the estate, but only for
his insolvency at the time the partition is made [Art. 1095, Civil Code].

Rights of Third Parties in Partition

a) The partition of a thing owned in common shall not prejudice third persons, who shall retain the
rights of mortgage, servitude, or any real rights belonging to them before the division was made [Art.
499, Civil Code]. Note: A “third person” is defined as all those who did not in any way participate or
intervene in the partition [Paras citing 3 Manresa 54 and Gonzaga v. Martinez, G.R. No. L-3196
(1908)].
b) The creditors or assignees of the co-owners may take part in the division of the thing owned in
common and object to its being effected without their concurrence [Art. 497, Civil Code].

Note: All kinds of creditors whether preferred or ordinary are included within the scope of creditors;
but they must have become creditors during the existence of the co-ownership and not before or after.

Exception: If the partition was already executed, the creditors/assignees cannot impugn the same.

Exception to the Exception: There was fraud or a previous formal opposition against the
partition, without prejudice to the right of the debtor or assignor to maintain its validity [Art. 497,
Civil Code].

The law does not expressly require previous notice to the creditors and assignees before a partition. If
notice is not given, the partition is not binding on the creditors and assignees.

But once notice has been given, it is the duty of creditors and assignees to intervene and make known
their stand. If they fail to do so, they cannot question the division made, except in cases of fraud.

e. Sale of property co-owned.

f. Termination of period agreed upon in co-ownership.

E. Possession

1. Possession in the Concept of a Holder

Art. 525, NCC – Possession in the concept of a holder with the ownership belonging to another.

One who possesses as a mere holder, not in the concept of owner, acknowledges in another a superior
right which he believes to be ownership, whether his belief is right or wrong.

Possession in the name of another – the one in actual possession is without any right of his own, but is merely
an instrument of another in the exercise of the latter’s possession. It can either be:

a. Voluntary – when exercised by virtue of an agreement. (Agents, administrators)

b. Necessary or legal – when exercised by virtue of law (representatives exercising possession in behalf of a
conceived child)

Examples:

a. Lessee
b. Trustee
c. Antichretic creditors
d. Agent
e. Attorney regarding client’s property
f. Depositaries
g. Co-owners

2. Possession in the Concept of an Owner

Possession in the concept of an owner – overt acts which tends to induce the belief of others that he is the
owner. If a person possesses in the concept of owner – he may eventually become the owner by prescription.

Thus, a person merely in the concept of holder cannot acquire property by acquisitive prescription – one
cannot recognize the right of another and at the same time claim adverse possession.
3. Relevance of Good Faith and Bad Faith

Possessor in good faith Possessor in bad faith

Requisites One who is unaware that there exists a flaw One who is aware that there exists in his/her
which invalidates his acquisition of the thing. title or mode of acquisition any flaw which
invalidates it.
a. He Believes that the person from whom
he received the thing was the owner of the a. Possessor has a title or mode of
same. acquisition.

b. That therefore he is now the owner based b. There is a flaw or defect in said title or
upon ostensible title or mode of mode.
acquisition.
c. Examples of vice/defect in title:
Eg. Sale, donation, inheritance, or other - Grantor was not the owner.
means of transmitting ownership. - Requirements for the
transmission was not complied
with.
- Mistake in the identity of the
person
- Property was not really res nullius.

d. The possessor was aware of the flaw or

Rights 1. Fruits – Art. 544, NC
-Fruits already received: Entitled to all the
fruits received before possession is legally
interrupted.
-Fruits still pending: Entitled to pro rate
the fruits already growing when
possession is legally interrupted.
2. Refund of necessary expenses – Art.
546, NCC
- Imposed by the thing itself and have no
relation to the desire or purpose of the
possessor. These are necessary expenses
for the preservation of the thing; hence
they are reimbursed.
-The possessor in good faith may retain
the thing until he is reimbursed for
necessary expenses.
3. Refund of useful expenses – Art. 546,
NCC
defect in the title.
1. Right to be respected in possession – Art.
539, NCC.
2. Right to necessary expenses and the
expenses for production, gathering and
preservation of fruits – Art. 545-546, NCC.
3. Does not have the right to reimbursement
of expenses for luxury but may remove
them as long as the principal thing suffers
no injury or may sell them to the owner
who opts to but the removable ornaments
– Art. 549, NCC.
4. No right to reimbursement for useful
improvements and no limited right of
removal – Art. 546, NCC.
5. Right to remove ornamental
improvements or be paid the value of such
at the time of recovery but at the owner’s
option.

- Incurred to give greater utility or

productivity to the thing.

- They are reimbursed only to the

possessor in good faith as a compensation
or reward. A possessor in bad faith cannot
recover such expenses.

- The possessor in good faith may retain

the thing until he/she is reimbursed for
useful expenses.

- The other party has the option to:

Refund the amount of expenses or pay the
increase in value which the thing may
have acquired.

Note: As to ornamental expenses or expenses

for pure luxury – Art. 548, NCC: the possessor
in good faith is not entitled to a refund of
 ornamental improvements but such
improvements may be removed if they do not
cause damage to the principal thing.

4. Right of retention when there are unpaid

necessary or useful expenses – Art. 546,
NCC

5. Removal of retention when there are

unpaid necessary or useful expenses –
Art. 546, NCC

6. No liability for deterioration or loss,

except in cases of fraudulent intent or
negligence – Art. 552, NCC.

7. May acquire full ownership by

prescription – Art. 1117-1138, NCC.

8. Presumption of just title – Art. 541, NCC

9. Can ask for the inscription of possession

in the registry of property – Art. 708, NCC

10. Generally, he/she can do on the thing

possessed everything that the law
authorizes an owner to do until he/she is
ousted by one who has a better right.

11. Can exercise the right of pre-emption and

is entitled to indemnity in case of
appropriation.

12. Has presumption of continuity of good

faith – Art. 528-529, NCC.

13. Non-interruption of possession – Art. 554

and 561, NCC.

14. Right to be respected and

protected/restored in his possession by
the means established by laws and rules of
court – Art. 539, NCC.

-these include summary of actions

(forcible entry and unlawful detainer),
accion publiciana and action for replevin.
accion reinvidicatoria is not included.
15. Lawful possessor can employ self-help –
Art. 429, NCC.

16. Possession of an immovable extends to

the movables within or inside – Art. 542
XPN – when it is shown or proven that
such movables shall be excluded.

Consequences
a. Possession is converted into
ownership after the required lapse of
time necessary for prescription – Art.
540, NCC.

 Possession must be under the claim of

ownership, and it must be peaceful,
public and uninterrupted – Art. 1118,
NCC.

6. Acts of possessory character done by

virtue of a license or mere tolerance on
the part of the real owner are not
sufficient and will not confer title by
 prescription or adverse possession – Art.
1119, NC

7. The following cannot acquire title by

prescription:

-Lessees, trustees, pledges, tenants on

shares or planters, and all those who hold
in the name or in representation of
another.

-Mere holders placed in possession of the

property by the owner such as agents and
employees.

-Those holding the title in fiduciary

character such as receivers, attorneys,
depositaries and antichretic creditors.

-Co-owner, with regard to common

property.

XPN: When he holds the same adversely

against all of the co-owners with notice to
them of the exclusive claim of ownership.

Obligations/ 1. Reimburse the value of fruits received and

which the legitimate possessor could have
liabilities received – Art. 549, NCC.
2. Pay in proportion to the charges, expenses
of cultivation and the net proceeds upon
cessation of good faith – Art. 545, NCC.
3. Bear the costs of litigation. -Art. 550 NCC.
4. Liability to the deterioration/loss of a
thing possessed in every case, including
fortuitous event – Art. 552, NCC.

4. Rules for Movables

F. Usufruct

Characteristics:

A temporary real right which gives a right to enjoy the property as well as its fruits of another with the
obligation of preserving its form and substance – Art. 562, NCC.

It is a real right of the use and enjoyment of the property, whether or not the same be registered in the
registry of property. It must be registered in the registry of property to prejudice third persons – Art. 709,
NCC.

1. Rights and Obligations of Usufructuary

Rights of Usufructuary

[HIRE FLIERS]: Half of hidden treasure, Increase, Remove, Enjoy, Fruits, Lease,
Improvements, Expenses, Retain, Set-off

1. To receive the Fruits of the property in usufruct - Art. 566, NCC

2. To enjoy any Increase that the thing in usufruct may acquire through accession,
1. Rights as to the
servitudes, and all benefits inherent therein - Art. 571, NCC
thing and its
fruits.
3. To receive Half of the hidden treasure if he accidentally finds it on the property
- Art. 566, NCC

4. To personally Enjoy the thing in usufruct - Art. 572, NCC

5. To Lease it to another - Art. 568-569 and 572, NCC

6. To make useful improvements or Expenses he may deem proper - Art. 579,

NCC
 7. To Remove improvements, provided there is no damage to the property - Art.
579, NCC

8. To Set-off improvements he may have made on the property against any

damage to the same - Art. 580, NCC

9. To Retain the thing until he is reimbursed for advances for extraordinary

expenses and taxes on the capital - Art. 612, NCC

2. Right to natural
and industrial
fruits pending Fruits pending at the beginning of the usufruct – belongs to the usufructuary w/o need
at the beginning to reimburse the expenses to the owner.
of usufruct.
Fruits pending at the termination of the usufruct – belong to the naked owner. The
owner shall reimburse to the usufructuary ordinary cultivation expenses from the
proceeds of the fruits (not to exceed the value of the fruits)

Right to Civil Fruits - Deemed to accrue daily and belong to the usufructuary in
proportion to the time the usufruct may last [Art. 569, Civil Code].

Special Rule as to Usufruct on Rent, Pension or Interest

Whenever a usufruct is constituted on the right to receive a rent or periodical pension,
whether in money or in fruits, or in the interest on bonds or securities payable to
bearer, each payment due shall be considered as the proceeds or fruits of such right
[Art. 570 (1), Civil Code].

Special Rule as to Benefits from Enterprise with No Date Fixed for

Distribution: Whenever it consists in the enjoyment of benefits accruing from a
participation in any industrial or commercial enterprise, the date of the distribution of
which is not fixed, such benefits shall have the same character [Art. 570 (2), Civil Code].
Special Rule for a Usufruct Over a Co- Owned Property

To exercise all rights of the particular co-owner with respect to the administration and
collection of fruits/interests from the aliquot share of property [Art. 582, Civil Code].

Should co-ownership cease by reason of partition, the usufruct of the part allotted to
the co-owner shall still belong to the usufructuary.

5. Right to lease GR: Can be Leased Without Consent of the Owner

the thing in
usufruct. Exceptions:

1. Caucion Juratoria, wherein the lease would show that the property is not
needed by the usufructuary and therefore the use for which the usufruct was
constituted is changed.

2. Condition imposed by naked owner i.e., Usufruct is purely personal, e.g., title
creating usufruct provides that usufructuary shall personally use and enjoy the
property given in usufruct.

3. Legal usufructs cannot be leased.

The Period of the Lease is Coextensive with the Period of Usufruct.

Exception: Lease of rural lands will subsist during the agricultural year despite
expiration of the usufruct [Art. 572, Civil Code]

Rules as to Lease:

1. A lease executed by the usufructuary before the termination of the usufruct and
subsisting after the termination of the usufruct must be respected, but the rents
for the remaining period will belong to the owner.

2. If the usufructuary has leased the lands or tenements given in usufruct, and the
usufruct should expire before the termination of the lease, he or his heirs and
successors shall receive only the proportionate share of the rent that must be
paid by the lessee [Art. 568, Civil Code].

3. A lease executed by the owner before the creation of the usufruct is not
extinguished by such usufruct.
 Notes:

Future crops may be sold but such sale would be void if usufruct terminates prior to
harvest of future fruits. The buyer’s remedy is to recover from the usufructuary.

The usufructuary-lessor is liable for the act of the substitute. A usufructuary who
alienates or leases his right of usufruct shall answer for any damage which the things in
usufruct may suffer through the fault or negligence of the person who substitutes him
[Art. 590, Civil Code].
6. Right to enjoy
any increase The usufructuary shall have the right to enjoy any increase which the thing in usufruct
which the thing may acquire through accession, the servitudes established in its favor, and, in general,
may acquire all the benefits inherent therein – Art. 571, NCC.
through
accession
7. To make A. He may improve the thing without altering its form and substance.
improvements B. He is not entitled to indemnification.
on the property
as he may deem C. He may also remove improvements made by him if it is possible to do
proper so without damage to property.

Note: The option to remove improvements belongs to the usufructuary, and the
naked owner cannot compel him to do so, neither can the owner compel the
usufructuary to leave the improvements and just pay for their value.

D. The usufructuary has the right to set-off the improvements on the

property against any damage to the same [Art. 580, Civil Code].

Note: Registration of improvements – to protect usufructuary against 3rd persons

8. Right of
retention The usufructuary has the right of retention until he is reimbursed of the amount he paid
for taxes and the increase in value caused by the extraordinary repairs he made [Art.
612, Civil Code].
9. Rights as to To Alienate or Mortgage the Right Itself [Art. 572, Civil Code]
the Legal
Right of The usufructuary may alienate his right of usufruct, even by a gratuitous title (e.g.
Usufruct Itself donation); but all the contracts he may enter into as such usufructuary shall terminate
upon the expiration of the usufruct [Art. 572, Civil Code].

[ABE – Alienate, Except:

Bring action,
Exercise all
1. Parental usufruct [Arts.225and226,Family Code]
rights]
2. Usufruct given in consideration of the person of the usufructuary intended to
last during his lifetime

To Bring Action and Oblige the Owner to Give Him Proper Authority and Necessary
Proof in Cases of Usufruct to Recover Real Property, Real Right, or Movable Property
[Art. 578, Civil Code]

The action may be brought in the name of the usufructuary. If a favorable judgment is
obtained, the usufruct shall be limited to the fruits, and the naked ownership shall
belong to the owner [Art. 578, Civil Code].

To Exercise all rights pertaining to the co- owner with respect to the administration and
collection of fruits or interest from the proper (Applicable to usufruct of a part of a
common property) [Art. 582, CC]

Obligations of Usufructuary

Obligations at the a) To make, after notice to the owner or his legitimate representative,
Beginning of the an inventory of all the property, which shall contain an appraisal of the
Usufruct or before movables and a description of the condition of the immovables [Art. 583 (1),
Exercising the Civil Code].
Usufruct
Exceptions to Making Inventory
1. Inventory: Shall
 contain
1. No one will be injured thereby [Art. 585, Civil Code]

a. Appraisal of the 2. Title constituting usufruct excused the making of inventory.

movables
3. Title constituting the usufruct already made the inventory.

b. Description of the b) To give security, binding himself to fulfill the obligations imposed upon him
conditions of in accordance with this Chapter [Art. 583 (2), Civil Code].
immovables.
Exceptions to Giving Security

2. Security 1. No prejudice would result [Art. 585, Civil Code];

2. Usufruct is reserved by a donor [Art. 584, Civil Code];
3. Gratitude on the donee’s part demands that the donor be excused
XPN: from filing the bond.
4. Title constituting usufruct excused usufructuary.
5. A usufructuary may take possession under a caucion juratoria
(bond by oath) [Art. 587, Civil Code]
WWW – AT - GUN 6. When there is waiver by the naked owner [Paras].
7. When the usufructuary is the donor of the property who has
reserved the usufruct [Art. 584, Civil Code].
8. When there is a parental usufruct under the Family Code [Art.
225, Family Code].

Requisites of Caucion juratoria:

1. Proper court petition;

2. Usufruct is over a house, furniture or tools of a trade and the
necessity for delivery of furniture, implements or house included
in the usufruct;
3. Approval of the court; and
4. Sworn promise.

Note: These requirements are not conditions precedent to the

commencement of the right of the usufruct but merely to the entry
upon the possession and enjoyment of the property.

Effect of Failure to Give Bond [Art. 586, Civil Code]:

1. The owner may demand that the immovable properties be placed under
administration;

2. That the movable properties be sold and the proceeds of the sale be the
property held in usufruct – legal interest of 6% shall be the fruits.

3. That the public bonds, instruments of credit payable to order or to bearer be

converted into registered certificates or deposited in a bank of public
institution.

4. That the capital or sums in cash and the proceeds of the sale of the movables
property be invested in safe securities.

5. The owner may, until the usufructuary gives security, retain in his possession
the property in usufruct as administration, subject to the obligation to deliver
to the usufructuary the net proceeds, after deducting the sums, which may be
agreed upon or judicially allowed him for such administration.

Obligations [CAPCORN – Care, Allow improvements, Pay AIDE (Annual taxes, Interest, Debts,
During the Expenses for litigation), Collect credit, Ordinary repairs, Replace animals, Notify UP
Usufruct (Urgent repairs, Prejudicial act)]

1. To take Care of the property as a good father of the family [Art. 589, Civil
Code]

2. To make Ordinary repairs – required by the wear and tear due to the natural
use of the thing and are indispensable for its preservation [Art. 592, Civil
Code].

3. To inform/Notify the owner of urgent extraordinary repairs [Art. 593, Civil

Code]
 4. To Allow the naked owner to make works and improvements of which the
immovable in usufruct is susceptible, or plantings, if rural [Art. 595, Civil
Code]

Provided:

a. The works or improvements are not prejudicial to the usufructuary’s rights.

b. No diminution in the value of the object in usufruct.

5. To Pay annual taxes and charges on the fruits for the time the usufruct lasts
[Art. 596, Civil Code].

6. To pay interest on taxes on capital paid by the naked owner [Art. 597, Civil
Code].

7. To pay debts if the usufruct is over the entirety of a patrimony [Art. 598, Civil
Code]

8. To secure the approval of the owner or the court to Collect credit which form
part of the usufruct, if he has not given proper security or has been excused
from giving security [Art. 599, Civil Code].

9. To notify owner of any Prejudicial act to the rights of ownership over the
usufruct, by a third person [Art. 601, Civil Code].

Consequence: He is liable for damages if he fails to give notice.

10. To pay expenses and costs for litigation if incurred because of the usufruct
[Art. 602, Civil Code].

11. To answer for fault or negligence of the one he alienated, leased to the object of
the usufruct or the fault or negligence of the usufructuary’s agent [Art. 590,
Civil Code].

Obligations at the 1. To Return the thing upon termination.

Time of the
Termination of the 2. To Pay legal interest for the duration of the usufruct on the expenses for
Usufruct extraordinary repairs, if naked owner made the repairs - Art. 594, Civil Code.

3. To Pay proper interest on sums paid as taxes by the owner

4. To Indemnify the naked owner for any loss caused by the negligence of the
usufructuary or his transferees.

3. Classes of Usufruct

Classifications

As to manner of Created by the will of private persons

Creation
By act inter vivos – such as contracts and donations;

By donation of the usufruct;

By retention of the usufruct by donor;

Voluntary

Where a usufruct is constituted inter vivos and for valuable

consideration, the contract is unenforceable unless in writing;

By act mortis causa – such as testament

As provided by law.

Usufruct of parents over the property of unemancipated children

 Legal
(now limited to the collective daily needs of the family) Art. 226 FC
Mixed Created both by law and the acts of persons, i.e. by acquisitive
prescription.

The rights and duties of the usufructuary provided by law may be

modified or eliminated by the parties. If the usufructuary is
authorized to alienate the thing in case of necessity, it is the
usufructuary who determines the question of necessity.
As to number of Simple Only one usufructuary enjoys the property.
benefits
Multiple Several usufructuaries enjoy the property as co- usufructuaries

Simultaneous At the same time.

Successive One after the other.

Limitations:
a. If by donation, all

donees must be alive [Art. 756, Civil Code].

2. Fiduciary and the second heir must be alive at the time of

the death of the testator [Art. 863, Civil Code].
3. If by testamentary succession, there must be only 2
successive usufructuaries, and both must be alive or at
least already conceived at the time of the testator’s death
and later born alive [Art. 869, Civil Code].

As to object of Rights Must not be strictly personal or intransmissible

usufruct
Normal Involves non-consumable things which the usufructuary can enjoy
without altering their form or substance (e.g. form and substance
are preserved).
Abnormal or When the usufruct includes things which cannot be used in a
irregular manner appropriate to its nature without being consumed, and if
not consumed, may be useless (ex: money, grain, liquors)
Quasi-usufruct Includes things which cannot be used without being consumed.
Money may be the object of usufruct [Art. 574, Civil Code]
As to effectivity Pure Without term or condition

With a term With a period, which may either be suspensive (from a certain day)
or resolutory (to a certain day)
conditional Subject to a condition which may either be suspensive (from a
certain event) or resolutory (until a certain event)

As to extent of the As to fruits Total - all consumed by the usufruct.

usufruct
Partial - constituted only on a part or certain aspects of the
usufruct’s fruits
As to objects Singular - only on particular property of the owner.

Universal - pertains to the usufruct over universal property, i.e.

over an entire patrimony, a whole inheritance of a compulsory heir,
a dowry;

3. Extinguishment of the Usufruct

By the Death of the GR: Usufruct is personal and it cannot be extended beyond the lifetime of the
Usufructuary, usufructuary. This is true even if a resolutory period or condition has been stipulated
unless a Contrary and the usufructuary dies before the expiration of the period or the fulfillment of the
Intention Clearly condition.
Appears
Exceptions - When a contrary intention clearly appears [Art. 603, Civil Code]

1. The parties may expressly stipulate that the usufruct shall continue even after the
death of the usufructuary until the arrival of a period or the happening of a certain
event.

2. In cases of multiple usufructs, the usufruct ends at the death of the last survivor -
 Art. 611, NCC.

 If constituted simultaneously: All usufracturies must be alive or at

least conceived at the time of the constitution - Art. 863, NCC

 If constituted successively:

a) By virtue of a donation: All donees- usufracturies must be

alive at the time of donation Art. 756, NCC.

3. By virtue of a will: there should only be 2 successive usufructuaries’, and both

must have been alive at the time of testator’s death - Same rule as in
fideicommissary substitution in Arts. 863 and 869, NCC.

If the period is fixed using the life of another person as reference or there is a
resolutory condition

In this case, the death of the usufructuary would not affect the usufruct and the right
is instead transmitted to the heirs of the usufructuary until the expiration of the term
or the fulfillment of the condition.
By the Expiration of Special Cases of Period:
the Period for
which it was 1. Special case of juridical persons [Art. 605, Civil Code]
Constituted
1. Usufruct cannot be constituted in favor of a town, corporation, or
association for more than 50 years.

2. If before the expiration of such period the town is abandoned, or the

corporation or association is dissolved, the usufruct shall be
extinguished.

2. Special case of third person attaining a certain age [Art. 606, Civil Code]

Subsists for the period specified (until the birthday at which the person
would’ve attained that age)

Exception: The usufruct has been expressly granted only in consideration

of the existence of such person
By the Fulfillment
of any Resolutory
Condition Provided
in the Title Creating
the Usufruct

By Merger of the
Usufruct and
Ownership in the
Same Person

By Renunciation of Limitations [De Leon]

the Usufructuary
1. May be made expressly or impliedly, but must comply with the forms of
donation
2. Does not require the consent of the naked owner
3. If made in fraud of creditors, they may rescind the waiver through an action
under Art. 1381, Civil Code (accion pauliana).

By the Total Loss of Total Loss:

the Thing in
Usufruct When the thing in usufruct is completely destroyed, or perishes, or disappears in
such a way that its existence is unknown or it cannot be recovered, or it goes out of
commerce [Art. 1189, Civil Code].

IF NOT INSURED

1. If usufruct is on the building and the land [Art. 607 (1), Civil Code] - If
the owner does not rebuild: Usufruct continues over the land and
materials (plus interests).

2. If usufruct is on the building only [Art. 607(2), Civil Code] -

 If the owner does not rebuild: Usufruct continues over the land and
materials (plus interests).

If the owner rebuilds: Owner can occupy the land and use the
materials.

If the owner occupies the land and uses the materials: He must
pay the usufructuary during the continuance of the usufruct the interest
on the value of the land and materials

IF INSURED

-Premium paid by Owner and usufructuary:

If the owner rebuilds: Usufructuary can continue enjoying the new building.

If the owner does not rebuild: Usufructuary shall receive interest on the insurance
indemnity.

-Premium paid by owner because usufructuary refuses to contribute to

the premium: Art. 608, NCC.

Owner shall receive the full amount of the insurance indemnity in case of loss, and
either of the following, depending on the case (apply Art. 607, Civil Code):

If the owner does not rebuild: Usufruct continues over the remaining land and
materials (plus interests)

If the owner rebuilds: Usufruct does not continue on the new building, but the owner
should pay interest on the value of the land and materials.

-When insurance taken by usufructuary only depends on value of

usufructuary’s insurable interest

Insurance proceeds go to the usufructuary. No obligation to rebuild. Usufruct

continues on the land. Owner has no share in insurance proceeds.

By the Termination Example: A usufruct constituted by a vendee a retro terminates upon redemption
of the Right of the
Person Constituting
the Usufruct

By Prescription 1. This refers to acquisitive prescription by a stranger [Paras].

2. It is not the non-use which extinguishes the usufruct by prescription, but the
use by a 3rd person [Tolentino].

3. There can be no prescription as long as the usufructuary receives the rents

from the lease of the property, or he enjoys the price of the sale of his right

Effect of termination: Obligations and Rights of the Usufructuary [Paras]

a. Must return the property to the naked owner [Art. 612, Civil Code]

b. Right to retain the property until he is reimbursed

1. For taxes on the capital which had been advanced by him [Art. 597 (2), Civil Code];
and

2. Indispensable extraordinary repairs or expenses insofar as there has been an

increase in the value [Art. 594 (2), Civil Code]

c. Right to remove removable improvements [Art. 579, Civil Code] or set them
off against damages he has caused [Art. 580, Civil Code].
 Obligations of the Owner [Paras]

a. Must cancel the security or mortgage after delivery is made [Art. 612, Civil
Code]

b. Must in case of rural leases, respect leases made by the usufructuary, till the
end of the agricultural year [Art. 572, Civil Code]

c. Must make reimbursements to the usufructuary in the proper cases [Arts. 597
and 594, Civil Code].
ACTS WHICH DO a. Expropriation of Thing in Usufruct [Art. 609, Civil Code]
NOT EXTINGUISH
THE USUFRUCT If the Naked Owner Alone was Given the Indemnity
General Rule: The naked owner has the option

1. To replace it with an equivalent thing; or

2. To pay to the usufructuary legal interest on the indemnity. This requires a
security to be given by the naked owner for the payment of the interest.

Exception: If both the naked owner and the usufructuary were separately given
indemnity, each owns the indemnity given to him, the usufruct being totally
extinguished.

If Both the Naked Owner and the Usufructuary were Separately Given
Indemnity - Each owns the indemnity given to him, the usufruct being totally
extinguished.

If Usufructuary Alone was Given the Indemnity [Paras]

1. He must give it to the naked owner and compel the naked owner to return
either the interest or to replace the property.

2. He may even deduct the interest himself, if the naked owner fails to object.

b. Bad Use of Thing in Usufruct [Art. 610, Civil Code]

Bad use of the thing in usufruct does not extinguish the right of the usufructuary
whether there is security or not.

If bad use causes considerable injury to the owner:

• It does not extinguish the usufruct but the owner is entitled to demand delivery and
administration of the thing with the obligation to pay annually the net proceeds.

The usufructuary is liable for damages caused to property.

G. Easements

Art. 613 – An easement or servitude is an encumbrance imposed upon immovable for the benefit of another
immovable belonging to a different owner.

The immovable in favor of which the easement is established is called the dominant estate; that which is subject
thereto, the servient estate.

An easement is either acquired through a title/juridical act or by prescription Art. 620 and 622, NCC.

When an easement is established, all rights necessary for its use are considered granted [Art. 625, Civil Code].

1. Characteristics

2. Kinds of Easements

Kind of easement How acquired

Title Prescription

Continuous and apparent (CA) YES YES

Continuous and non-apparent YES NO

 (CNA)

Discontinuous and apparent (DA) YES NO

Discontinuous non-apparent YES NO

(DNA)

When an easement is established, all rights necessary for its use are considered granted [Art. 625, Civil Code].

Continuous – Use of which is or may be incessant, without intervention of any act of man.

Discontinuous – Those which are used at intervals and depend upon the actions of man

Apparent – Those which are made known and are continually kept in view by external signs that reveal the use
and enjoyment of the same. Not necessary that its sign be seen; it is sufficient if it may be known or seen on
inspection

Non-Apparent – Shows no external indication of their existence

3. Modes of Acquiring Easements

a. By title or by something equivalent to a title. (Something equivalent to title – refers to law or juridical
acts such as donations, contracts or wills)

Kind of easement Title

Continuous and apparent (CA) YES – Art. 620, NCC

Continuous and non-apparent (CNA) YES - acquired by title only and not by prescription.

Discontinuous and apparent (DA) The absence of a document or proof showing the origin of an
easement which cannot be acquired by prescription may be cured
by a deed of recognition by the owner of the servient estate or by a
Discontinuous non-apparent (DNA) final judgment [Art. 623, Civil Code].

Deed of recognition: By an affidavit or a formal deed

acknowledging the servitude.

Final judgment: Owner of the dominant estate must file a case in

court to have the easement declared by proving its existence
through other evidence.

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. This is also applicable to cases of co-ownership [Art. 624, Civil Code].

Exception: At the time the ownership of the two estates is divided, the title of conveyance of either of the two
estates provides for the contrary (says the easement will not continue) or the apparent sign of easement is
removed before the execution of the deed of conveyance [Art. 624, CC].

Illustration: The presence of 4 windows was considered an apparent sign that created a negative easement of
light and view (altius non tollendi) i.e. not to build a structure that will cover the windows [Amor v. Florentino,
G.R. No. L-48384 (1943)].

b. By Law (Legal Easements) - Easements imposed by law have for their object either public use or the
interest of private persons [Art. 634, Civil Code]. Legal easements are created by law, whether for public use or
for the interest of private persons [Art. 619 and 634, Civil Code].

These easements may be modified by agreement of the interested parties, whenever the law does not
prohibit it, or no injury is suffered by a third person [Art. 636, Civil Code].

For Public Easements

1. Special laws and regulations relating thereto (e.g. PD 1067 (Water Code) and PD 705 (Forestry
Code)).
2. By the provisions of Chapter 2, Title VII, Book II, Civil Code.
 For Private Legal Easements

1. By agreement of the interested parties whenever the law does not prohibit it and no injury is
suffered by a 3rd person.
2. By the provisions of Chapter 2, Title VII, Book II.

Voluntary easements are created by the will of the owners of the estate through contract, last will or
donation. These must be recorded in the Registry of Property to prejudice third persons [Art. 619, Civil
Code].

Note: Easements cannot be created by courts. The court’s role is only to declare the existence of an
easement if in reality one exists by virtue of law or will of the parties. Thus, there are no judicial
easements [Castro v. Monsod, G.R. No. 183719 (2011)].

Kinds of Legal Easement

4. Relating to Waters

 Natural Drainage [Art. 637, Civil Code]

Lower estates are obliged to receive the waters which naturally and without the intervention of man
descend from the higher estates (as well as the stones or earth which they carry with them). The owner of
the lower estate cannot construct works which will impede this easement; neither can the owner of the
higher estate make works which will increase the burden.

Refer to Art. 46 of the Water Code which states that “when artificial means are employed to drain water
from higher to lower land, the owner of the highest land shall select the routes and methods of drainage
that will cause the minimum damage to the lower lands, subject to the requirements of just
compensation.”

 Riparian Banks [Art. 638, Civil Code] The banks of rivers and streams, even in case they are of
private ownership, are subject throughout their entire length and within a zone of 3 meters for urban
areas, 20 meters for agricultural areas and 40 meters for forest areas [Art. 51, Water Code]
along their margins, to the easement of public use in the general interest of navigation, floatage, fishing,
recreation and salvage.

Estates adjoining the banks of navigable or floatable rivers are subject to the easement of towpath for the
exclusive service of river navigation and floatage. If it is necessary to occupy lands of private ownership,
the proper indemnity shall first be paid.

 Abutment of a Dam [Art. 639, Civil Code] Whenever for the diversion or taking of water from a
river or brook, or for the use of any other continuous or discontinuous stream, it should be necessary to
build a dam, and the person who is to construct it is not the owner of the banks, or lands which must
support it, he may establish the easement of abutment of a dam, after payment of the proper indemnity.

Note: The Water Code requires a water permit for the establishment of a dam [Art. 18, Water Code].

 Drawing Water and Watering Animals [Arts. 640 and 641, Civil Code]

Compulsory easements for drawing water or for watering animals can be imposed only for reasons of
public use in favor of a town or village, after payment of the proper indemnity [Art. 640, Civil Code].

Easements for drawing water and for watering animals carry with them the obligation of the owners of the
servient estates to allow passage to persons and animals to the place where such easements are to be used,
and the indemnity shall include this service [Art. 641, Civil Code].

The width of the easement must not exceed 10 meters [Art. 657, Civil Code].

 Aqueduct [Arts. 642-646, Civil Code]

Any person who may wish to use upon his own estate any water of which he can dispose shall have the
right to make it flow through the intervening estates, with the obligation to indemnify their owners, as
well as the owners of the lower estates upon which the waters may filter or descend [Art. 642, Civil Code].

Requisites to Establish Easement of Aqueduct [Art. 643, Civil Code]:

1. To prove that he can dispose of the water and that it is sufficient for the use for which it is
intended;

2. To show that the proposed right of way is the most convenient and the least onerous to third
persons;
 3. To indemnify the owner of the servient estate in the manner determined by the laws and
regulations.

4. Acquire a water permit [Art. 13, Water Code]

What it cannot be imposed on: Easement of aqueduct for private interest cannot be imposed on
buildings, courtyards, annexes, or outhouses, or on orchards or gardens already existing [Art. 644, Civil
Code].

Right of servient estate owner: This easement does not prevent the owner of the servient estate from
closing or fencing it, or from building over the aqueduct in such manner as not to cause the latter any
damage, or render necessary repairs and cleanings impossible [Art. 645, Civil Code].

Treatment under law: This easement is considered as continuous and apparent, even though the flow
of the water may not be continuous, or its use depends upon the needs of the dominant estate, or upon a
schedule of alternate days or hours [Art. 646, Civil Code].

In the appropriation of water, there is a need to apply for water rights.

Any person having an easement for an aqueduct may enter upon the servient land for the purpose of
cleaning, repairing or replacing the aqueduct or the removal of obstructions therefrom [Art. 49, Water
Code].

Easements for aqueduct and of right of way cannot be acquired by prescription because although it may
be apparent, it is discontinuous in character. Under the Water Code of the Philippines, all waters belong
to the state.

Water legally appropriated shall be subject to the control of the appropriator from the moment it reaches
the appropriator from the moment it reaches the appropriator’s canal or aqueduct leading to the place
where the water will be used or stored and, thereafter, so long as it is being beneficially used for the
purposes for which it was appropriated [Art. 8, Water Code].

 Stop Lock or Sluice Gate [Art. 647, Civil Code] The construction of a stop lock or sluice gate in the
bed of the stream from which the water is to be taken, for the purpose of irrigating or improving an estate.
Such person may demand that the owners of the banks permit its construction, after payment of damages,
including those caused by the new easement to such owners and to the other irrigators.

2. Right of Way

Who May Demand [Art. 649, Civil Code]

1. The owner of the dominant estate; or

2. Any person with the real right to cultivate or use the dominant estate e.g. a usufructuary, a de jure
possessor.

Note: A lessee cannot demand such easement, because the lessor is the one bound to maintain him in the
enjoyment of the property.

Note: A right of way can be established through the will of parties as well, and the provisions on the legal
easement of right of way will not govern.

Requisites for Legal Demand to Establish the Easement of Right of Way [Art. 649, Civil Code;
Floro v. Llenado, G.R. No. 75723 (1995)]

a. The dominant estate is surrounded by other immovables owned by other persons;

b. There must absolutely be no access i.e. means of entrance or exit/egress to a public highway;

c. Even if there is access, it is difficult or dangerous to use, or grossly insufficient;

1. Mere inconvenience in the use of an outlet does not render the easement a necessity.

2. An adequate outlet is one that is sufficient for the purpose and needs of the dominant owner, and can
be established at a reasonable expense.

3. Does not necessarily have to be by land – an outlet through a navigable river or a lake or the sea if
suitable to the needs of the tenement is sufficient.

4. The isolation of the immovable is not due to the dominant owner’s own acts e.g. if he constructs
building to others obstructing the old way; and
 5. There is payment of indemnity.

Rules for Establishing Right of Way

The easement of right of way shall be established at the point least prejudicial to the servient
estate, and, insofar as consistent with this rule, where the distance from the dominant estate to a
public highway may be the shortest [Art. 650, Civil Code].

The criterion of least prejudice to the servient estate must prevail over the criterion of shortest distance
although this is a matter of judicial appreciation. While shortest distance may ordinarily imply least
prejudice, it is not always so as when there are permanent structures obstructing the shortest distance;
while on the other hand, the longest distance may be free of obstructions and the easiest or most
convenient to pass through [Quimen v. CA, G.R. No. 112331 (1996)].

The fact that LGV had other means of egress to the public highway cannot extinguish the said easement,
being voluntary and not compulsory. The free ingress and egress along Mangyan Road created by the
voluntary agreement between the parties is thus legally demandable with the corresponding duty on the
servient estate not to obstruct the same [La Vista Association v. CA, G.R. No. 95252 (1997)].

The width of the easement of right of way shall be that which is sufficient for the needs of the dominant
estate, and may accordingly be changed from time to time [Art. 651, Civil Code].

Who has the Burden of Proof in an action for Right of Way?

The burden of proving the existence of the prerequisites to validly claim a compulsory right of way lies on
the owner of the dominant estate.

3. Light and View [Arts. 667-673, Civil Code]

Easement of Light (jus luminum) - The right to admit light from the neighboring estate by virtue of
the opening of a window or the making of certain openings.

Easement of View (jus prospectus) - The right to make openings or windows, to enjoy the view
through the estate of another and the power to prevent all constructions or works which would obstruct
such view or make the same difficult. The easement of view necessarily includes the easement of light,
because it is impossible to have a view only without a light. However, it is possible to have light without a
view.

How Acquired - Through a period of prescription of 10 years, counted depending on whether it was
positive or negative in nature.

Nature [Art. 668, Civil Code]

a. Positive: Opening a window through a party wall.

1. Period of prescription begins upon the opening being made through the wall of another.

2. When a part owner of a party wall opens a window therein, such act implies the exercise of the right of
ownership by the use of the entire thickness of the wall.

3. The easement is created only after the lapse of the prescriptive period.

b. Negative: Opening a window through a wall on the dominant estate.

1. Period of prescription begins upon the formal prohibition upon the owner of the adjoining land or tenement.

1. Formal means that the prohibition has been notarized. Means notice and demand was given to the owner
of the possible servient estate [Cortes v. Yu- Tibo, G.R. No. 911 (1903)].

2. When a person opens a window on his own building, he is exercising his right of ownership on his
property, which does not establish an easement.

Coexistent is the right of the owner of the adjacent property to build or plant on his own land, even if such
structures or planting cover the window.

If the adjacent owner does not build structures to obstruct the window, such is considered mere tolerance and not
a waiver of the right to build.
An easement is created only when the owner opens up a window and subsequently prohibits or restrains the
adjacent owner from doing anything that may tend to cut off or interrupt the light and the 10-year prescriptive
period has lapsed by a notarial prohibition.

Note: What is the reason why the easement of light and view and the easement not to build a higher
easement (altius non tollendi) cannot go together?

An easement of light and view requires that the owner of the servient estate shall not build to a height that
will obstruct the window. They are, as it were, the two sides of the same coin. While an easement of light
and view is positive, that of altius non tollendi is negative [Amor v. Florentino, G.R. No. L-48384 (1943)].

Limitations as to Measurements

No windows, apertures, balconies, or other similar projections which afford a direct view upon or towards
an adjoining land or tenement can be made, without leaving a distance of two meters between the wall in
which they are made and such contiguous property. Neither can side or oblique views upon or towards
such conterminous property be had, unless there be a distance of sixty centimeters [Art. 670, Civil Code].

In cases of direct views from the outer line of the wall when the openings do not project, the distance shall
be measured from the outer line of the latter when they do, and in cases of oblique view from the dividing
line between the two properties [Art. 671, Civil Code].

Exception: In buildings separated by a public way or alley, not less than 3 meters wide, the distances required do
not apply [Art. 672, Civil Code].

Exception: The distances may be stipulated by the parties, provided that the distance should not be less than
what is prescribed by the law (2 meters and 60 centimeters) [Art. 673, Civil Code].

Whenever by any title a right has been acquired to have direct views, balconies or belvederes overlooking
an adjoining property, the owner of the servient estate cannot build thereon at less than a distance of
three meters to be measured in the manner provided in Article 671 [Art. 673, Civil Code].

Note: Breach of the required distances results into the prescriptive period not running [Art. 670, Civil
Code].

Notes on the Acquisition of the Easement

Period of acquisitive prescription depends upon whether the easement of light and view is positive or
negative.

If positive, then the prescription period is counted from the day the window is opened. If negative, then
the prescription period is counted from the formal prohibition made on the owner of the servient estate
[Art. 668, Civil Code].

c. By Prescription - Continuous and apparent easements may be acquired by prescription of 10 years [Art. 620,
Civil Code].

Requisites:

1. The easement must be continuous and apparent;

2. The easement must have been used for 10 years; and
3. There is no need for good faith or just title.

Kind of Definition Computation of time possession

easement

Positive easement Imposes upon the servient owner the From the day on which the owner of the
obligation of allowing something to be dominant estate, or the person who may have
done, or doing it himself – Art. 616, made use of the easement, commenced to
NCC. exercise it upon the servient estate.

Prohibits the servient owner from
doing something which he could
Negative lawfully do if the easement did not
easement exist – Art. 616, NCC.
From the day on which the owner of the
dominant estate forbade, by an instrument
acknowledged before a notary public, the owner
of the servient estate, from executing an act
which would be lawful without the easement.
4. Effects of Easement

5. Extinguishment of Easements – MINERRO: Merger, Impossibility, Non-use, Expiration, Renunciation,

Redemption, Other causes – Art. 631, NCC.

By Merger in the same Must be absolute, perfect and definite, and not merely temporary. If the merger
person of the ownership is temporary, there is at most a suspension of the easement, but no
of the dominant and extinguishment.
servient estates
By Non-user for ten There is inaction, and not outright renunciation. This is due to the voluntary
years abstention by the dominant owner, and not due to a fortuitous event.

1. If discontinuous easement, the period is counted from the day it

ceased to be used.

2. If continuous easement, counted from the day an act adverse to the

exercise of the right of easement took place.

3. Note: use by a co-owner bars prescription as to others as well [Art. 633,

Civil Code].

Impossibility of use impossibility referred to must render the entire easement unusable for all time.
Impossibility of using the easement due to the condition of the tenements (e.g.
flooding) only suspends the servitude until it can be used again.

• Exception: If the suspension exceeds 10 years, the easement is

deemed extinguished by non-use.
By the Expiration of the applies only to voluntary temporary or conditional easements.
term or the fulfillment of
the resolutory condition
By the Renunciation of must be specific, clear, express (distinguished from non-user);
the owner of the
dominant estate
By the Redemption
agreed upon between the
owners of the dominant
and servient estates.
Other Causes Not 1. Annulment and rescission of the title constituting the
Mentioned in Art. 631, voluntary easement;
Civil Code
2. Termination of the right of grantor of the voluntary
easement;

3. Abandonment of the servient estate; Owner of the servient estate

gives up ownership of the easement (e.g. the strip of land where the
right of way is constituted) in favor of the dominant estate. The
easement is extinguished because ownership is transferred to the
dominant owner, who now owns both properties.
4. Eminent domain; and the government’s power to expropriate
property for public use, subject to the payment of just compensation.

5. Special cause for extinction of legal rights of way: if right of

way no longer necessary [Art. 655, Civil Code]

Right of Way Ceases to

be Necessary Right of Way Ceases to be Necessary [Art. 655, Civil Code]:

1. Owner of the dominant estate has joined to another abutting on a

public road.

2. A new road is opened giving access to the isolated estate

3. Requisite: the public highway must substantially meet the needs of

the dominant estate.

4. Owner of the servient estate may demand that the easement be

extinguished, and he must return what he may have received by way of
indemnity. The interest thereon shall be deemed payment for rent for
the use of the easement.

The opening of an adequate outlet to a highway can extinguish only legal or

compulsory easements, not voluntary easements. The fact that an easement by
grant may have also qualified as an easement of necessity does not detract from
 its permanency as a property right, which survives the termination of the
necessity.

III. Different Modes of Acquiring Ownership

Modes of Acquiring Ownership [Art. 712, Civil Code]

1. Occupation - Arts. 713-720, Civil Code

2. Donation - Arts. 712, 725-726, Civil Code
3. Prescription and Laches - Arts. 712, 1106-1107, Civil Code
4. Intellectual Creation - Arts. 721-724, Civil Code; Intellectual Property Code
5. Testate and Intestate Succession - Arts. 774-1105, Civil Code
6. By tradition, in consequence of certain contracts - Arts. 1458-1637, Civil Code

Note: Only items (a), (b) and (c) are discussed in Property. Item (d) is discussed in the Intellectual Property Code
part of the Commercial Law reviewer. Items (e) and (f) are discussed in the Succession and Sales part,
respectively, of the Civil Law reviewer.

A. Occupation

1. Requisites

1. The subject must have the intention to acquire ownership and the necessary capacity to consent.

2. The object must be appropriable by nature and without an owner.

3. There must be an act of taking possession of the thing (not necessarily material holding so long as the
thing is considered subjected to the disposition of the possessor

2. Rules

a. On Land - Ownership of land cannot be acquired by occupation [Art. 714, Civil Code].

b. On animals

Wild Animals - Possessed only while under a person’s control [Art. 560, Civil Code].

Domesticated Animals - Domesticated animals are those who retain the habit of returning to the
premises of their owner [Art. 560, Civil Code]; and Claimable by prior owner within twenty days from
occupation by another person [Art. 716, Civil Code].

Swarm of Bees - Prior owner has the right to pursue them to another’s land, but is liable for damages
the other person may suffer [Art. 716, Civil Code].

Other persons may occupy or retain the swarm if prior owner:

1. Has not pursued the swarm; or,

2. Ceased to pursue the swarm within two consecutive days from movement towards other person’s
property [Art. 716, Civil Code]

Pigeons and Fish

General Rule: Belongs to the owner of the breeding place into which they have moved [Art. 717, Civil
Code];

Exception: Belongs to prior owner if movement was enticed by some artifice or fraud [Art. 717, Civil
Code].

c. On Other Personal Property Abandoned Movables

May be acquired, as long as the abandonment made by the prior possessor is voluntary and
intentional [De Leon].

Lost Movables (except treasure) [Art. 719, Civil Code]

Known/Unknown Possessor
 1. If prior possessor is known, the thing must be returned to him/her;
2. If prior possessor is unknown, the thing must be deposited with the mayor of the city/municipality
where it was found;

Procedure [Arts. 719-720, Civil Code]

1. The mayor publicly announces the finding of the thing for two consecutive weeks in the way he deems
best.

2. If the item cannot be kept without deterioration or without expenses that considerably diminish its
value, it shall be sold at public auction eight days after the publication.

3. If the owner does not appear within six months from publication, the thing or its value shall be
awarded to the finder.

4. If the owner appeared in time, the owner is obliged to pay the finder one-tenth of the price of the
thing.

Hidden Treasure

Definition: Any hidden and unknown deposit of money, jewelry, or other precious objects the lawful
ownership of which does not appear [Art. 439, Civil Code].

Ownership

General Rule: Belongs to the owner of the property where it is found [Art. 438, Civil Code].

Exceptions [OTI-other, trespasser, interest]:

1. If found on (a) property of another, the State, or any of its subdivisions and (b) by chance;

a. Only one-half shall be allowed to the finder;

2. If finder is a Trespasser;

Finder is not entitled to any share; and,

3. If things are of Interest to science or the arts;

The State may acquire them at their just price, which shall be divided in conformity with the rules stated

B. Tradition

C. Donation

1. Features

Requisites [CADAF]

1. Capacity of donor to make a donation;

2. Donative intent (Animus donandi);

3. Delivery (actual or constructive);

4. Acceptance by the donee; and,

1. Acceptance by the donee is required because donation is never obligatory. One cannot be
compelled to accept the generosity of another.

2. Although under Art. 725, donation is an act, it is really a contract. The essential requisites of
consent, subject matter, and cause must be present [Tolentino].

5. Necessary Form prescribed by law.

Persons Who May Give/Receive a Donation

General Rule: All persons who may contract and dispose of their property [Art. 735, Civil Code].

Exceptions:

a. Guardians and trustees cannot donate the property entrusted to them [Art. 736, Civil Code];

b. Minors and others who cannot enter into a contract may become donees but acceptance shall be done
through their parents or legal representatives [Art. 741, Civil Code];

c. For donation to conceived and unborn children, acceptance may be made by persons who would legally
represent them if they were already born [Art. 742, Civil Code];

d. Donations made to incapacitated persons shall be void (though simulated under the guise of another
contract or through a person who is interposed) [Art. 743, Civil Code]; and,

e. When the same thing is donated to two or more different donees, rules on double sale govern [Art. 744,
Civil Code];

1. If personal property - ownership goes to the first possessor in good faith;

2. If immovable property - ownership goes to the first registrant in good faith [Art. 1544, Civil Code].

2. Classifications

3. Distinctions Between Mortis Causa and Inter Vivos Donations

4. Form

5. Limitations

Effects and Limitations

Effect. – The patrimony or assets of the donor is decreased, while that of the donee is increased.

Limitations

1. Reservation of sufficient means for support of donor and relatives [Art. 750, Civil Code];

1. Donation without reservation is not null and void in its entirety; it is only subject to reduction by
the court;

2. Limitation applies to simple, remunerative and modal donations but not to onerous ones nor to
donations mortis causa;

2. Donations cannot comprehend future property [Art. 751, Civil Code];

1. Future property: understood as anything which the donor cannot dispose of at the time of the
donation;

2. Rationale: Nobody can dispose of that which does not belong to him;

Future inheritance cannot be donated because it is considered future property. However, upon the death
of his predecessor, the inheritance ceases to be future and consequently, may be the object of donation
[Osorio v. Osorio, G.R. No. 16544 (1921)];

c. Amount of donation limited to what donor may give by will [Art. 752, Civil Code];

1. A person may not donate more than he can give by will. A donation, which exceeds what the donor
may give or receive by will, is considered inofficious.

2. Limitation applies where the donor has forced or compulsory heirs.

6. Reduction and Revocation

Reduction Revocation

Total withdrawal of amount, whether the legitime is Amount is only insofar as the legitime is prejudiced;
impaired or not
Benefits the donor Benefits the donor’s heirs (except when made on the
ground of the appearance of a child).
Revocation due to birth, appearance, or adoption of a child applies only to donations inter vivos and not to
donations mortis causa, onerous donations, and donations propter nuptias [De Leon].

Situations Contemplated

1. The existence of children, if the donor has no such child when the donation was made [Art. 760, Civil
Code];

2. The donee’s failure to comply with any of the conditions the former imposed upon the latter [Art. 764,
Civil Code];

3. The donee’s ingratitude [Art. 765, Civil Code];

4. Inofficious donations [Art. 752, Civil Code]; or

5. Multiple donations cannot be covered by the disposable portion in case of succession [Art. 773, Civil
Code].

E.Prescription

Definition

By prescription, one acquires ownership and other real rights through the lapse of time in the manner and
under the conditions laid down by law. In the same way, rights and conditions are lost by prescription
[Art. 1106, Civil Code].

Note: For purposes of acquiring ownership, only acquisitive prescription is being referred to.

2. Who May Acquire Ownership by Prescription

Persons who are capable of acquiring property or rights by the other legal modes may acquire the same by
means of prescription [Art. 1107 (1), Civil Code].

Minors and other incapacitated persons may acquire property or rights personally or through their
parents, guardians, or legal representatives [Art. 1107 (2), Civil Code].

1. Distinctions Between Acquisitive and Extinctive Prescription

Acquisitive Prescription

The acquisition of ownership and other real rights through possession in the concept of owner of a thing
in the manner and condition provided by law.

Ordinary - Ordinary acquisitive prescription requires possession of things in good faith and with just
title for the time fixed by law.

Note: Ownership and other real rights over immovable property are acquired by ordinary prescription
through possession of ten years [Art. 1134, Civil Code]

Extraordinary - Extraordinary acquisitive prescription is the acquisition of ownership and other real
rights without need of title or of good faith or any other condition.

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.

Requisites

1. Capacity to acquire by prescription;

2. A thing capable of acquisition by prescription;
3. Possession of the thing under certain conditions; and
4. Lapse of time provided by law

Periods

1. Movables
1. 4 years ‐ If in good faith; and,
2. 8 years ‐ If in bad faith [Art. 1140 in
 relation to Art. 1132, Civil Code]

2. Immovables
a. 10 years ‐ If in good faith b. 30 years ‐ If in bad faith

2. Distinctions Between Extinctive Prescription and Laches

When Inapplicable By Offender - The offender can never acquire, through prescription, movable
properties possessed through a crime such as robbery, theft, or estafa [Art. 1133, Civil Code].

Note: The person who cannot invoke the right of prescription is the offender or person who committed
the crime or offense, not a subsequent transferee who did not participate in the crime or offense, unless
the latter knew the criminal nature of the acquisition of the property by the transferor.

Registered Lands - No title to registered land in derogation of the title of the registered owner shall be
acquired by prescription or adverse possession [Property Registration Decree, PD 1529].

Actions to Demand a Right of Way; to Abate a Nuisance [Art. 1143, Civil Code] Action to Quiet
Title if Plaintiff is in Possession

When the plaintiff is in possession of the property, the action to quiet title does not prescribe. The reason
is that the owner of the property or right may wait until his possession is disturbed or his title is assailed
before taking steps to vindicate his right.

Void Contracts - The action or defense for the declaration of the inexistence of a contract does not
prescribe [Art.1410, NCC]

Action to Demand Partition; Distinguished from Laches - No prescription shall run in favor of a
co-owner or co-heir against his co-owners or co-heirs so long as he expressly or impliedly recognizes the
co-ownership [Art. 494, Civil Code].

Property of Public Dominion - Prescription, both acquisitive and extinctive, does not run against the
State in the exercise of its sovereign function to protect its interest except with respect to its patrimonial
property which may be the object of prescription [Art. 1113, Civil Code].

Prescription of Ownership and Other Real Rights - Ownership and other real rights over
immovable property are acquired by ordinary prescription through possession of ten years [Art. 1134,
Civil Code].

Prescription of Actions

a. To Recover Movables

General Rule: Eight (8) years from the time possession was lost [Art. 1132 and 1140, Civil
Code]

Exception:

1. If action is brought after four (4) years when the possessor has already acquired title by
ordinary acquisitive prescription [Art. 1132, Civil Code].
2. If the possessor acquired the movable in good faith at a public sale, the owner cannot
obtain its return without reimbursing the price paid [Art. 559, Civil Code].

b. To Recover Immovables

General Rule: Real actions prescribe after thirty (30) years [Art. 1141, Civil Code].

Exception: The possessor has acquired ownership of the immovable by ordinary acquisitive prescription
through possession of ten (10) years [Art. 1134, Civil Code].

c. Other Actions

Action for Reconveyance

1. Based on fraud: Four (4) years from the discovery of fraud [Art. 1391, Civil Code]

2. Based on implied or constructive trust: Ten (10) years from the alleged fraudulent registration or
date of issuance of certificate of title over the property [Art. 1144, NCC]

Notes:
 1. An action for reconveyance may be barred by prescription. However, one recognized exception is when
the property in dispute is in actual possession of the plaintiff. Prescription does not run against the
plaintiff in actual possession of the disputed land because such plaintiff has a right to wait until his
possession is disturbed or his title is questioned before initiating an action to vindicate his right. As such,
his undisturbed possession gives him the continuing right to seek the aid of a court of equity to determine
the nature of the adverse claim of a third party and its effect on his title [Heirs of Bernardo and Ronquillo
v. Sps. Gamboa and Caballero, G.R. 23305 (2020)].

2. An action for reconveyance and cancellation of title prescribes in 10 years from the time of the issuance of
the Torrens title over the property [Heirs of Sumagang v. Aznar Enterprises, G.R. No. 214315 (2019)].

Interruption of Prescription When Interrupted

1. When the action is filed before the court;

2. When there is a written extrajudicial demand by the creditors; and,
3. When there is any written acknowledgment of the debt by the debtor.

Note: An interruption of the prescriptive period wipes out the period that has elapsed, sets the same
running anew, and creates a fresh period for the filing of an action [Selerio v. Bancasan, G.R. No. 222442
(2020)].

Types of Interruption

1. Natural – Any natural cause that interrupts the possession for more than one year [Art. 1121, Civil Code]

2. Civil – [Art. 1123, Civil Code]

1. For acquisitive prescription – starts from the time judicial summons are received;

2. For extinctive prescription – starts from the time action is filed in court, written extrajudicial
demand by the creditors is received, or when there is written acknowledgment of the debt by the
debtor [Art. 1155, Civil Code].

Suspension in Case of Acquisitive Prescription. – The period of interruption shall be counted in favor of
prescription (i.e., as if interruption never happened but is merely suspended) if:

1. Judicial summons is void;

2. The plaintiff should desist from the complaint;
3. The possessor was absolved from the complaint.

Effects of Interruption

1. All the benefits acquired so far from the possession ceases.

2. When the prescription runs again, it will be reset (i.e. entirely new prescriptive period

Land Titles and Deeds

A. Torrens System

1. General Principles

The Torrens System : Grey Alba v. De la Cruz, 1910 - A system for registration of land under which,
upon landowner’s application, the court may, after appropriate proceedings, direct the issuance of a
certificate of title [Black’s Law Dictionary]; those systems of registration of transactions with interest in
land whose declared object is, under governmental authority, to establish and certify to the ownership of
an absolute and indefeasible title to realty, and to simplify its transfer.

Nature - Judicial in nature.

Purpose: SM Prime Holdings, Inc. v. Madayag, 2009 - It aims to decree land titles that shall be final,
irrevocable and indisputable to relieve the land of the burden of known as well as unknown claims.
GR: A title once registered cannot be impugned, altered, changed, modified, enlarged, or diminished.
XPN: Direct proceeding permitted by law, usually for the protection of innocent third persons

Background - The Torrens system was introduced in the Philippines by Act No. 496, which took effect
on Jan. 1, 1903. This was later amended and superseded by P.D. 1529 which took effect on June 11, 1978.

The underlying principle of the Torrens system is security with facility in dealing with land. It requires
that the government issue an official certificate of title attesting to the fact that the person named is the
owner of the property described therein, subject to such liens and encumbrances thereon noted or the law
warrants or reserves. The certificate of title is indefeasible and imprescriptible and all claims to the parcel
of land are quieted upon issuance of said certificate [Cruz v. Secretary of Environment and Natural
Resources, G.R. No. 135385 (2000)].

Title Certificate of title

Lawful cause or ground of possessing that which is

ours.
That which constitutes a just cause of exclusive
possession, or which is the foundation of
ownership of property.
Mere evidence of ownership; it is not the title to
the land itself [Castillo v. Escutin, G.R. No.
171056 (2009)].

Land Title It is the evidence of the right of the owner or the extent of his interest, by which
he can maintain control, and as a rule, assert right to exclusive possession and
enjoyment of the property. Title is a conclusive evidence of ownership and it
cannot be attacked collaterally.
Deed A written instrument executed in accordance with law, wherein a person grants or
conveys to another certain land, tenements or hereditaments.

Elements of A Deed

a. Grantor
b. Grantee
c. Words of Grant
d. Description of the property involved
e. Signature of the grantor
f. At least two (2) witnesses
g. Notarial acknowledgment
Estate An estate, strictly speaking, represents the nature, extent, degree, and quantity of
a person’s interest in land.

Types of Estates

a. Freehold Estate – Indicates title of ownership

1. Fee Simple – An absolute title; Absolute estate in perpetuity; Title to land

is conferred upon a man and his heirs absolutely and without any
limitation imposed upon the estate
2. Fee Tail – One designed to pass title from grantee to his heirs, in the
intent of the grantor being to keep the property in the grantee’s line of
issue
3. Life Estate – One held for the duration of the life of the grantee; In some
cases, it may terminate earlier as by forfeiture.

b. Less-than-Freehold Estate – Signifies some sort of right short of title

1. Estate for Years – In the nature of a lease short of title; grantee or lessee
takes over possession of the land for a period agreed upon but the grantor
retains the legal title to the property
2. Tenancy from period to period – Also in the nature of a lease which
may run from month to month or from year to year, with the peculiarity of
automatic renewal from time to time, unless expressly terminated by either
party
3. Tenancy at will – Another form of lease agreement where a person is
permitted to occupy the land of another without any stipulation as to
period, but either party reserves the right to terminate the occupation at
will or at any time

Land A judicial or administrative proceeding whereby a person’s claim of ownership over

registration a particular land is determined and confirmed or recognized so that such land
 and the ownership thereof may be recorded in a public registry.

Note: Registration does not vest title. It is not a mode of acquiring ownership but is
merely evidence of such title over a particular property.

µ Nature of Land Registration - Judicial proceedings for land registration throughout the Philippines shall
be in rem [Sec. 2, par. 1, P.D. 1529].

A proceeding in rem is when the object of the action is to bar indifferently all who might be mined to
make an objection of any sort against the right sought to be established, and if anyone in the world has a
right to be heard on the strength of alleging facts which if true, show an inconsistent interest [Agcaoili].

Land registration is binding on the whole world because “by the description in the notice (of initial
hearing of the application for registration)

“To Whom It May Concern,” all the world are made parties defendant” [Aquino, citing Esconde v.
Barlongay, G.R. No. L-67583 (1987)].

In a registration proceeding, the judgment of the court confirming the title, and ordering its registration
in one’s name constitutes, when final, res judicata against the whole world [Ting v. Heirs of Lirio, G.R.
No. 16891 (2007)].

There is no need to personally notify the owners or claimants of the land sought to be registered if it is
involved in a land registration case since it is a proceeding in rem. This gives automatic power and
authority to the court over the res [Guido-Enriquez v. Victorino, et al., G.R. No. 180427 (2013)].

 Laws Implementing Land Registration

1. Public Land Act [CA 141, as amended]

2. Property Registration Decree [P.D.1529, as amended]
3. Cadastral Act [Act 2259, as amended]
4. Indigenous Peoples Rights Act of 1997 [RA 8371]
5. Emancipation Decree [P.D. 27, as amended]
6. Comprehensive Agrarian Reform Law of 1988 [RA 6657, as amended]

To simplify and streamline land registration proceedings, Presidential Decree No. 1529 was issued on
June 11, 1978, otherwise known as the Property Registration Decree, governing registration of lands under
the Torrens system as well as the recording of transactions relating to unregistered lands, including
chattel mortgages. This Decree consolidates, in effect, all pre-existing laws on property registration with
such appropriate modifications as are called for by existing circumstances [Peña].

 Purpose of Land Registration

Registration is merely a species of notice. The act of registering a document is never necessary in order
to give it legal effect as between the parties. The system maintains a permanent record of landholdings, in
order to prevent fraudulent claims to land by concealment of transfers.

Another purpose is to notify and protect the interests of strangers to a given transaction, who may
be ignorant thereof. However, where a document so registered is invalid or legally defective, registration
will not in any way render it valid or cure its defect.

 Object of Registration - Only real property or real rights may be the object of registration
under the existing land registration laws.

µ Classification of Lands [Sec, 3, Art. XII, 1987 Constitution]

a. Agricultural
b. Forestland or timberland
c. Mineral Lands
d. National Parks

Classification of lands is an exclusive prerogative of the executive department. In the absence of

such classification, the lands remain as unclassified until it is released therefrom and rendered open to
disposition. The President, through a Presidential Proclamation or Executive Order can classify or
reclassify land to be included or excluded from the public domain. The DENR Secretary is also
empowered to approve a land classification and declare such land as alienable and disposable [Agcaoili ,
citing Fortuna v. Republic, G.R. No. 173423 (2014)].

 Registrable lands are:

 a. Alienable public agricultural lands - If the land is in the public domain, the land must be
classified as alienable and disposable. It must be classified as such at the time of filing the application
for registration [Republic v. CA and Naguit, G.R. No. 144057 (2005)].
b. Private lands

Non-registrable lands - Those found in the Civil Code dealing with non- registrable properties (e.g.
property of public dominion)

µ Administration of the Torrens System

1. Land Registration Authority - Agency under the executive supervision of the Department of Justice
charged with the efficient execution of the laws relative to the registration of lands

Composition:

a. Administrator

b. 2 Deputy Administrators (as assistants)

Functions of LRA

1. Extend speedy and effective assistance to the Department of Agrarian Reform, the Land Bank,
and other agencies in the implementation of land reform program of the government
2. Extend assistance to courts in ordinary and cadastral land registration proceedings; and
3. Be the central repository of records relative to original registration of lands titled under the T
orrens system, including the subdivision and consolidation plans of titled lands.

2. Register of Deeds - Public repository of records of instruments affecting registered or

unregistered lands and chattel mortgages in the province or city wherein such office is situated.

Composition:

1. Register of Deeds
2. Deputy (as assistant)

Functions of Registers of Deeds:

1. Immediately register an instrument presented for registration dealing with real or personal
property which complies with the requisites for registration;
2. Shall see to it that said instrument bears the proper documentary stamps and that the same are
properly cancelled;
3. If the instrument is not registerable, he shall deny the registration thereof and inform the
4. presentor of such denial in writing, stating the ground or reason therefore, and advising him of
his right to appeal by consulta in accordance with Sec. 117 of P.D. 1529;
5. d. Prepare and keep an index system which contains the names of all registered owners and lands
registered.
6. The function of the ROD with reference to registration of deeds, encumbrances, instruments, and
the like is ministerial in nature, provided the applicant complies with all the requisites
[Baranda v. Gustilo, G.R. No. 81163 (1988)].
7. Note: When the ROD is in doubt as to the proper action to take on an instrument or deed
presented to him for registration, he should submit the question to the Administrator of the LRA
en consulta [P.D. 1529, Sec 117]

B. Regalian Doctrine

 Concept of the Regalian Doctrine - All lands became the exclusive patrimony and dominion of the
Spanish Crown [Agcaoili].

The Regalian Doctrine is enshrined in the 1987 Constitution [Sec, 2 & 3, Art. XII] which states that all
lands of public domain belong to the State, thus private title to land must be traced to some grant,
express or implied, from the State, i.e. The Spanish Crown or its successors, the American Colonial
government and thereafter the Philippine Republic.

The present Constitution provides that, except for agricultural lands of the public domain which alone
may be alienated, forest or timber, and mineral lands, as well as all other natural resources
must remain with the State, the exploration, development, and utilization of which shall be subject to
its full control and supervision albeit allowing it to enter into co-production, joint venture, or production-
sharing agreements, or into agreements with foreign-owned corporations involving technical or financial
 assistance for large-scale exploration, development, and utilization [Secs. 2 and 3, Art. XII; La Bugal-
B’laan Tribal Association, Inc. v. Ramos, G.R. No. 127882 (2004)].

It does not negate native title to lands held in private ownership since time immemorial [Cruz v. Sec. of
Environment and Natural Resources, G.R. No. 135385 (2000)].

 Effects of the Regalian Doctrine

1. All lands of public domain belong to the State, and that the State is the source of any asserted right to
ownership in land and charged with the conservation of such patrimony [Republic v. IAC, G.R. No. 71285
(1987)].

2. Under the Regalian doctrine, all lands of whatever classification and other natural resources not otherwise
appearing to be clearly within private ownership are presumed to belong to the State which is the
source of any asserted right to ownership of land [Republic v. Remman Enterprises, Inc. G.R. No. 199310
(2014)].

3. The burden of proof in overcoming the presumption of State ownership of the lands of the public
domain is on the person applying for registration (or claiming ownership), who must prove that the
land subject of the application is alienable or disposable. To overcome this presumption, incontrovertible
evidence must be established that the land subject of application (or claim) is alienable or disposable
[Valiao v. Republic, G.R. No. 170757 (2011)].

 Native Title and Ancestral Domains

1. Native Title

Recognizes ownership of land by Filipinos independent of any grant from the Spanish crown on the basis
of possession since time immemorial [Cariño v. Insular Government, G.R. No. 2869 (1907)].

Lands under native title are not part of public domain, “lands possessed by an occupant and his
predecessors since time immemorial, such possession would justify the presumption that the land had
never been part of the public domain or that it had been private property even before the Spanish
conquest [Republic v. CA, G.R. No. 130174 (2000)].

2. Ancestral Domains

Refer to all areas generally belonging to ICCs/IPs comprising lands, inland waters, coastal areas, and
natural resources therein, held under a claim of ownership, occupied or possessed by ICCs/IPs, by
themselves or through their ancestors, communally or individually since time immemorial, continuously
to the present except when interrupted by war, force majeure or displacement by force, deceit, stealth or
as a consequence of government projects or any other voluntary dealings entered into by government and
private individuals/corporations, and which are necessary to ensure their economic, social and cultural
welfare. It shall include ancestral lands, forests, pasture, residential, agricultural, and other lands
individually owned whether alienable and disposable or otherwise, hunting grounds, burial grounds,
worship areas, bodies of water, mineral and other natural resources, and lands which may no longer be
exclusively occupied by ICCs/IPs but from which they traditionally had access to for their subsistence and
traditional activities, particularly the home ranges of ICCs/IPs who are still nomadic and/or shifting
cultivators.

C. Nationality Restrictions on Land Ownership

D. Original Registration (PD 1529)

This is a proceeding brought before the land registration court to determine title or ownership of
land on the basis of an application for registration or answer by a claimant in a cadastral registration.

A decree of registration merely confirms, but does not confer ownership [City Mayor of
Parañaque City v. Ebio, G.R. No. 178411 (2010)].

Registration does not vest title or give title to the land, but merely confirms and thereafter protects the
title already possessed by the owner, making it imprescriptible by occupation of third parties. The
registration does not give the owner any better title than he has. He does not obtain title by virtue of the
certificate. He secures his certificate by virtue of the fact that he has a fee simple title [Legarda v. Saleeby,
G.R. No. 8936 (1915)].

Original Distinguished From Subsequent

 Original registration Subsequent registration

When right of ownership or title to land is for the Any transaction affecting such originally registered
first time made of public record land, if in order, may be registered in the Office of
the Register of Deeds concerned

 Voluntary or Involuntary

Voluntary- by filing with the proper court under: Involuntary - as in Cadastral Proceedings

1. P.D. 1529, Property Registration Decree a) This is compulsory registration initiated

2. CA 141, Public Land Act by the government to adjudicate
3. R.A. No. 8371, The Indigenous People’s ownership of the land
Rights Act of 1997 b) Involuntary on the part of the claimant
but they are compelled to substantiate
their claim or interest

1. Who May Apply

1. Under Sec. 14, P.D. 1529, as amended by Sec. 6, R.A. No. 11573

a) Those who by themselves or through their predecessors-in-interest have been in open, continuous,
exclusive and notorious possession and occupation of alienable and disposable lands of the public domain
not covered by existing certificates of title or patents under a bona fide claim of ownership for at least
twenty (20) years immediately preceding the filing of the application for confirmation of title except when
prevented by war 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 certificate of title under this section.

b) Those who have acquired ownership of private lands or abandoned riverbeds by right of accession or
accretion under the provisions of existing laws.
c) Those who have acquired ownership of land in any other manner provided for by law [see Republic
represented by Mindanao Medical Center v. CA, G.R. No. 40912 (1976)]

Land owned in common: ALL co- owners shall file the application jointly.

Land has been sold under
pacto de retro:
the vendor a retro may file an application for the original registration of the
land, provided, however, that should the period for redemption expire during
the pendency of the registration proceedings and ownership to the property
consolidated in the vendee a retro, the latter shall be substituted for the
applicant and may continue the proceedings.

Land subject of a trust A trustee on behalf of his principal may apply for original registration of any
agreement: land held in trust by him, unless prohibited by the instrument creating the
trust.

Note: R.A. No. 11573 was signed into law on 16 July 2021. The cutoff date for
the 2022 Bar Coverage is 30 June 2021.

2. Under Sec. 16, P.D. 1529; Land Applied for Registration by a Non- Resident of the Philippines

He shall file his application:

1. An instrument in due form;

2. Appointing a duly authorized representative or attorney-in-fact, whose authority shall accompany the
application;
3. Giving his full name and postal address; and
4. Shall therein agree that the service of any legal process in the proceedings under or growing out of the
application made upon his agent or representative shall be of the same legal effect as if made upon the
applicant within the Philippines.

3. Under Sec. 12, CA 141

Any person who:

 1. Is a citizen of the Philippines over the age of 18, or the head of a family;
2. Does not own more than 24 hectares of land in the Philippines, or has not had the benefit of any
gratuitous allotment of more than 24 hectares of land since the occupation of the Philippines by the
United States

Note: they may enter a homestead of not exceeding 24 hectares of agricultural land of the public domain

4. Under R.A. No. 8371:

1. Formal recognition of ancestral domains by virtue of Native Title may be solicited by ICCs/IPs concerned
[Sec. 11]
2. Option to secure certificate of title under CA 141 or Land Registration Act 496 [Sec. 12]

a. Individual members of cultural communities, with respect to individually- owned ancestral lands
who, by themselves or through their predecessors-in -interest, have been in continuous
possession and occupation of the same in the concept of owner since time immemorial or for a
period of not less than thirty (30) years immediately preceding the approval of this Act and
uncontested by the members of the same ICCs/IPs shall have the option to secure title to their
ancestral lands
b. Option granted shall be exercised within 20 years from the approval of RA 8371

D. Jurisdiction

Where to File: The court that should take cognizance of a registration case is that which has
territorial jurisdiction over the property.

GR: RTC of the province, city, or municipality where the property is situated.

The RTC shall have exclusive jurisdiction over all applications for original registration of title, with power
to hear and determine all questions arising upon such applications or petition [Sec. 2 (2), P.D. 1529].

XPN: Delegated jurisdiction to the MTC, MeTC, and MCTC by the Supreme Court in cadastral and land
registration cases if:

1. There is no controversy over the land, OR

2. Its value is less than P100,000 [Sec. 34, BP 129]

2. Decree of Registration

µ Process of Registration [Sec. 55, P.D. 1529] a. The deed or other voluntary instrument

1) Must contain the following details of the grantee or other person acquiring or claiming interest:

a) Full name
b) Nationality
c) Residence
d) Postal address
e) Civil status (if married, include name in full of spouse)
f) If grantee is a corporation: It must contain a recital showing that such corporation or
association is legally qualified to acquire private lands.

2) Must be executed in accordance with Sec. 112. It shall be:

a) In a public instrument executed in accordance with law;

b) Signed by the parties in the presence of at least 2 witnesses who shall likewise sign thereon;
c) Where the instrument has for its object 2 or more parcels of land, the number thereof shall
also be stated in the acknowledgment;
d) Each page of the copy of the instrument, except the page where the signatures already appear
at the foot of the instrument, shall be signed on the left margin thereof by the parties and
their witnesses, and sealed with the notarial seal. This fact as well as the number of the pages
shall be stated in the acknowledgment.

3) File instrument creating or transferring interest and certificate of title with Register of Deeds
together with:

a) Owner’s duplicate
i. ●  Serves as conclusive authority from the registered owner to the Register of
Deeds to enter a new certificate or to make a new memorandum of
registration in accordance with the voluntary instrument presented [Sec. 107,
P.D. 1529]
 ii. ●  The issuance of a new transfer certificate without presentation of an
owner’s duplicate is unwarranted and confers no right on the purchaser
[PNB v. Fernandez, G.R. No. 42109 (1935)]
b) Payment of fees & documentary stamp tax
c) Evidence of full payment of real estate tax
d) Document of transfer–1 copy additional for city/provincial assessor

4) Payment of fees and DST

a) After payment of entry fee, the Register of Deeds shall enter the instruments in a primary
entry book [Sec. 56, P.D. 1529].
b) The national, provincial and city governments are exempted from payment of entry fees.
c) R.A. No. 456 prohibits registration of documents affecting real property which is
delinquent in the payment of real estate taxes. Further, if evidence of such payment is not
presented with 15 days from the date of entry of said document in the primary entry book
of the register of deeds the entry shall be deemed cancelled.

5) Entry of the Instrument in the Primary Entry Book: Instruments are regarded as registered
from the time the Register of Deeds enters them in the book.
6) TCT shall then be issued.

µ Registration of Dealings Less than Ownership [Sec. 54, P.D. 1529]

If an instrument does not divest ownership or title from owner or from transferee of the registered
owners, then no new certificate shall be entered or issued.

µ Process of Registration for Dealings less than Ownership

a. Filing of the instrument with the Register of Deeds

b. A brief memorandum thereof is made:

1. On the certificate of title by the Register of Deeds and signed by him, and
2. On the owner’s duplicate

Cancellation or extinguishment of such interests shall be registered in the same manner.

µ Registration of Deeds of Sale and Transfers

a. If entire property is the subject [Sec. 57, P.D. 1529]

1. Owner executes and registers the deed which must be sufficient in form.
2. A new certificate of title is issued and Register of Deeds prepares and delivers to grantee his
owner's duplicate certificate
3. Register of Deeds notes upon the OCT and the duplicate certificate the date of transfer, the
volume and page of the registration book where the new certificate is registered
4. The original and the owner's duplicate of the grantor's certificate shall be stamped "cancelled".
5. The deed of conveyance shall be filed and indorsed with the number and the place of registration
of the certificate of title of the land conveyed.

b. If only a portion of property is the subject [Sec. 58, P.D. 1529]

1. Include a plan which shows all the portions already subdivided with verified and approved
technical description.
2. That plan with the certified copy of the technical descriptions shall be filed with the Register of
Deeds for annotation in the TCT.
3. Register of Deeds shall issue a TCT and cancel the grantor's certificate partially OR it may be
cancelled totally and a new one issued describing therein the remaining portion

c. If there are SUBSISTING encumbrances and annotations: They shall be carried over in the new
certificate or certificates; except when they have been simultaneously discharged.

µ Registration of Mortgages and Leases - [Sec. 60, P.D. 1529]

o Mortgages and leases shall be registered in the manner provided in Sec. 54 (Dealings less than
ownership).
o The deed shall take effect upon the title only from the time of registration.
o When a deed of mortgage is presented, the Register of Deeds will enter upon the OCT and upon
the owner’s duplicate a memorandum thereof and shall sign said memorandum.

µ Registration of Powers of Attorneys [Sec. 64, P.D. 1529]

 Powers of attorney and revocations shall be registered with the Register of Deeds of the province or city
where the land lies. Any instrument revoking such power shall be registered in like manner.

µ Registration of Trusts - Registration is by memorandum:

a. A memorandum by the words “in trust” or “upon condition” or other apt words is made if a deed or
other instrument is filed in order to:

1. Transfer registered land in trust ,or upon any equitable condition or limitation expressed therein, or
2. Create or declare a trust or other equitable interests in such land without transfer [Sec. 65, P.D. 1529]

b. A memorandum by the words “with power to sell,” or “power to mortgage” or other apt words is made
when: The instrument creating or declaring a trust or other equitable interest contains an EXPRESS
POWER to sell, mortgage, or deal with the land in any manner

However, if an implied or constructive trust is claimed, person claiming such must execute a sworn
statement thereof with the Register of Deeds, containing a description of the land, the name of the
registered owner and a reference to the number of the certificate of title. Such claim shall not affect
the title of a

3. Review of Decree of Registration; Innocent Purchaser for Value (IPV); Rights of IPV

µ Innocent purchaser for value and in good faith

An innocent purchaser for value refers to someone who "buys the property of another without notice that
some other person has a right to or interest in it, and who pays a full and fair price at the time of the
purchase or before receiving any notice of another person’s claim" [Sps. Villamil v. Villarosa, G.R. No.
177187 (2009)].

Good faith consists in the possessor’s belief that the person from whom he received the thing was the
owner of the same and could convey his title, and there was an honest intention to abstain from taking
any unconscientious advantage from another [Duran v. IAC, G.R. No. L-64159 (1985); Fule v. De Legare,
G.R. No. 17951 (1963)].

Where innocent third persons relying on the correctness of the certificate of title issued acquire rights
over the property, the court cannot disregard such rights and order the total cancellation of the certificate
of title for that would impair the public confidence in the certificate of title [Duran v. IAC, G.R. No. L-
64159 (1985)].

µ Mortgagee in good faith

Even if the mortgagor is not the rightful owner of, or does not have the valid title to the mortgaged
property, the mortgagee in good faith is entitled to protection [Llanto v. Alzona, G.R. No. 150730 (2005)].

µ Reliance on title

GR: A person dealing with registered property need not go beyond, but only has to rely on, the title
[Campillo v. PNB, G.R. No. L-19890 (1969)]. He is charged with notice only of such burdens and claims
which are annotated on the title, for registration is the operative act that binds the property.

XPN: When should a purchaser investigate?

1. Banks are required to exercise more care and prudence in dealing with registered lands for their
business is one affected with public interest. The general rule does not apply [Omengan v. PNB, G.R.
No. 161319 (2007)].
2. When the purchaser or mortgagee is a financing institution [Dela Merced v. GSIS, G.R. No. 140398
(2001)].
3. When party concerned has actual knowledge of facts and circumstances that would impel a
reasonably cautious man to make inquiry [Leung Yee v. Strong Machinery Company, G.R. No. L-
11658 (1918)].
4. When purchaser is in bad faith; e.g. he had full knowledge of a previous sale [Jomoc v. CA, G.R. No.
92871 (1991)].
5. Purchaser of land where the certificate of title contains a notice of lis pendens.
6. When a person buys land from one whose rights over the land is evidenced only by a deed of sale and
an annotation in the certificate of title but no TCT [Reyes v. CA, G.R. No. L-28466 (1971)].

µ Double Sales

Where two certificates of title are issued to two different persons covering the same parcel of land in
whole or in part, the earlier in date must prevail as between the original parties and in case of successive
registration where more than one certificate is issued over the land, the person holding title under the
 prior certificate is entitled to the property as against the person who relies on the second certificate
[National Housing Authority v. Laurito, G.R. No. 191657 (2017)].

The purchaser from the owner of the later certificate and his successors should resort to the vendor for
redress, rather than molest the holder of the first certificate and his successors, who should be permitted
to rest secure in their title [Gatioan v. Gaffud, G.R. No. L-21953 (1969)].

µ Forged Deed

GR: A forged deed is an absolute nullity and conveys no title.

XPN: If there is good faith, a TCT has already been issued to the purchaser, the latter being an
innocent purchaser for value according to Sec. 39, P.D. 1529, then the title is good.

E. An Act Improving the Confirmation Process for Imperfect Land Titles (RA 11573), amending CA
141 and PD 1529 [See Republic v. Pasig Rizal Co., Inc., G.R. No. 213207, February 15, 2022]

F. Certificate of Title

a) The Torrens Title - Certificate of ownership issued by the Register of Deeds naming and declaring the
owner of the real property described therein free from all liens and encumbrances, except such as
may be expressly noted thereon or otherwise reserved by law.

1. Original Certificate It is the first certificate of title issued in the name of the registered owner by the
of Title (OCT) Register of Deeds covering a parcel of land which had been registered under the
Torrens System, by virtue of judicial or administrative proceedings.

2. Transfer Certificate The subsequent certificate of title pursuant to any deed of transfer or conveyance
of Title (TCT) to another person. The Register of Deeds shall make a new certificate of title and
give the registrant an owner’s duplicate certificate. The previous certificate shall be
stamped “cancelled.”

3. Patents Whenever public land is by the Government alienated, granted or conveyed to any
person, the same shall be brought forthwith under the operation of this Decree
[Sec. 103, P.D. 1529]

1. Patents only involve public lands which are alienated by the Government
pursuant to the Public Land Act [CA 141, as amended]
2. The patent (even if denominated as a deed of conveyance) is not really a
conveyance but a contract between the grantee and the Government and
evidence of authority to the Register of Deeds to make registration.
3. The act of registration is the operative act to affect and convey the land.

b) Probative Value

A Torrens Certificate of Title is valid and enforceable against the whole world. It may be received
in evidence in all courts of the Philippines, and shall be conclusive as to all matters contained therein,
principally the identity of the owner of the covered land thereby and identity of the land.

A Torrens title, once registered, cannot be defeated, even by adverse, open and notorious
possession. A registered title under the Torrens system cannot be defeated by prescription. The title,
once registered, is notice to the whole world. All persons must take notice. No one can plead ignorance of
the registration [Egao v. CA, G.R. No. L-79787 (1989)].

c) Effects of Registration under the Torrens System

1. Land is placed under the operation of the Torrens system.

2. Claims and liens prior to the decree of registration

GR: Claims and liens of whatever character existing against the land prior to the issuance of the
certificate of title are cut off by such certificate and the certificate so issued binds the whole world,
including the government.

A decree of registration bars all claims and rights which arose or may have existed prior to the decree of
registration. By the issuance of the decree, the land is bound and title thereto quieted, subject only to
certain exceptions under the property registration decree [Heirs of Delfin, v. Rabadon, G.R. No. 165014
(2013)].
 XPN:

a. Those claims noted on the certificate

b. 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 in order to be valid
c. 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

 Title to the land becomes non- prescriptible

GR:

a) Even adverse, notorious, and continuous possession under claim of ownership for the period fixed by
law is ineffective against a Torrens title [JM Tuason and Co. Inc. v. CA, G.R. No. L-41233 (1979)].
b) The fact that the title to the land was lost does not mean that the land ceased to be registered land
before the reconstitution of its title. It cannot perforce be acquired by prescription [Ruiz v. CA, G.R.
No. 29213 (1977)].
c) Lands under a Torrens title cannot be acquired by prescription or adverse possession. Section 47 of
P.D. No. 1529, the Property Registration Decree, expressly provides that no title to registered land in
derogation of the title of the registered owner shall be acquired by prescription or adverse possession
[Dream Village Neighborhood Association, Inc., v. Bases, 2013.

XPN:

1. If previous valid title of the same land exists

2. When the land covered is not capable of registration
3. When acquisition of certificate is attended by fraud

 Torrens certificate is presumed valid and devoid of flaws.

Note: Registration is not equivalent to legal title. Under the Torrens system, registration only gives
validity to the transaction or creates a lien upon the land. It merely confirms, but does not confer,
ownership [Lu v. Sps. Orlando and Manipon, G.R. No. 147072 (2002)].

d) Effect of Non-Registration

GR: If a purchaser, mortgagee or grantee should fail to register his deed the conveyance, considering our
existing registration laws, it shall not be valid against any person unless registered.

XPN:

1. The grantor,
2. His heirs and devisees, and
3. Third persons having actual notice or knowledge thereof.

e) Dealings in Land before Issuance of Decree

With the filing of an application for registration, the land described therein does not cease to become open
to any lawful transaction. If the transaction takes place before the issuance of the decree of registration,
Section 22 of P.D. 1529 provides that the instrument is to be presented to the RTC, together with a motion
praying that the same be considered in relation with the pending application.

However, if the motion is filed after the decision of adjudication has become final but before the issuance
of the decree by the Administrator of Land Registration Authority, the court shall require the interested
party to pay the fees prescribed as if such instrument had been presented for registration in the office of
the Register of Deeds.

f) Laches, When Applicable

Laches sets in if it takes 18 years for a person to file an action to annul the land registration proceedings,
especially so if the registrant has already subdivided the land and sold the same to innocent third parties.
A party’s long inaction or passivity in asserting his rights over disputed property precludes him from
recovering the same.

G. Subsequent Registration - A proceeding where incidental matters after original registration may be
brought before the land registration court by way of motion or petition filed by the registered owner or a party in
interest.

 Necessity and Effects of Registration - [Sec. 51 and 52, P.D. 1529]

1. The deed, mortgage, lease, or other voluntary instrument, except a will shall ONLY operate as:
 a. A contract between the parties and
b. Evidence of authority to the Register of Deeds to make registration.

2. The act of registration shall be the operative act to convey or affect the land insofar as third persons are
concerned.

3. Also, by registration, it creates constructive notice to the world.

Registration of a document is ministerial on the part of the Register of Deeds. The purpose of registering
an instrument is to give notice thereof to all persons, not to destroy or affect already registered rights over
the land at the time of the registration. Registration must first be allowed, and validity or effect litigated
afterwards [Gurbax Singh Pabla & Co. v. Reyes, G.R. No. L-3970 (1952)].

As between the parties to a contract of sale, registration is not necessary to make it valid and effective, for
actual notice is equivalent to registration [Agcaoili].

The act of registration creates a constructive notice to the whole world and binds third persons

1. Voluntary Dealings

Voluntary dealings are deeds, instruments, documents which are the results of free and voluntary acts of
parties thereto.

The act of registration shall be the operative act to convey or affect the land insofar as third persons are
concerned [Sec. 51, P.D. 1529].

µ Voluntary Dealings vs. Involuntary Dealings

Voluntary Involuntary
Refer to deeds, instruments, or documents which Refer to the writs, orders, or processes issued by the
are results of the free and voluntary acts of the parties court of record affecting registered land, also other
thereto. instruments which are not willful acts of the
registered owner, executed without his knowledge or
consent.
1. Sale 1. Attachment

2. Real property mortgage 2. Mandamus

3. Lease 3. Sale on execution of judgment or sales for

taxes.
4. Pacto de retro sale
4. Adverse claims
5. Extra-judicial settlement
5. Notice of lis pendens
6. Free patent/homestea d
6. Expropriation
7. Powers of attorney
7. Forfeiture
8. Trusts
8. Auction sale on foreclosure of mortgage

Presentation of the owner’s duplicate certificate of title
is required to notify; mere entry in the day book of the
Register of Deeds (ROD) is insufficient
An innocent purchaser for value of registered land
becomes the registered owner the moment he presents
and files a duly notarized and valid deed of sale and
the same is entered in the day book of the ROD and at
the same time he surrenders or presents the owner’s
duplicate certificate of title covering the land sold and
pays the registration fees.
It is necessary to register the deed or instrument in the
entry book of the ROD and a memorandum thereof
shall also be made in the owner’s duplicate certificate
and its original
At the time of the filing of the petition for cancellation
of encumbrance, the lease contract already lost its
efficacy. Thus, there is no basis to save its annotation
on defendant’s title. The fact that the cancellation of
the lease contract was forged is of no moment, for
there was no violation of a right
Entry in the day book of ROD is sufficient notice to all
persons
Entry thereof in the day book of the ROD is sufficient
notice to all persons even if the owner’s duplicate
certificate of title is not presented to the ROD
[Saberon v. Ventanilla, Jr., G.R. No. 192669 (2014)].
Entry in the day book of the ROD is sufficient notice
to all persons of an adverse claim without the same
being annotated at the back of the certificate of title
Entry of the attachment in the books is sufficient
notice to all persons. Hence, the fact that the deed of
sale was already annotated is of no moment with
regard to third The persons. The preference created by
the levy on attachment is not diminished by the
subsequent registration of the deed of sale
2. Involuntary Dealings - Involuntary dealings refer to the writ, order, or process issued by the court of record
affecting registered land, also other instruments which are not willful acts of the registered owner, executed
without his knowledge or consent. The entry thereof in the day book is sufficient notice to all persons of such
adverse claim.

The following involuntary dealings affecting registered land must be registered:

1. Attachments [Sec. 69, P.D. 1529]

2. Adverse claim [Sec. 70, P.D. 1529]
3. Sale on execution or for taxes or for any assessment [Sec. 74, P.D. 1529]
4. Notice of lis pendens [Sec. 76, P.D. 1529]

1. Attachments - Attachment is a writ issued at the institution or during progress of an action commanding the
sheriff to attach the property, rights, credits or effects of the defendant to satisfy demands of the plaintiff.

Kinds:

a. Preliminary
b. Garnishment
c. Levy on execution

Process of Registration

1. Copy of writ in order to preserve any lien, right or attachment upon registered land shall be filed with the
Register of Deeds where the land lies, containing number of certificate of title of land to be affected or
description of land [Sec. 69, P.D. 1529]
2. Register of Deeds to index attachment in names of both plaintiff & defendant or name of person whom
property is held or in whose name stands in the records

a. If duplicate of certificate of title is not presented:

● Register of Deeds shall within 36 hours send notice to registered owner by mail stating that there has
been registration & requesting him to produce duplicate so that memorandum be made

● If owner neglects or refuses – Register of Deeds shall report matter to court.

b. Court after notice shall enter an order to owner to surrender certificate at time & place to be named
therein.

c. Although notice of attachment is not noted in duplicate, notation in book of entry of Register of Deeds
produces effect of registration already

Effect of registration of attachment

1. Creates real right

2. Has priority over execution sale
3. But between 2 attachments – one that is earlier in registration is preferred

Duty of Register of Deeds - Duty is ministerial but may refuse registration in the following circumstances:

1. Title to land is not in the name of defendant (Exception: If petitioner is an heir)

2. No evidence is submitted to show that he has present or possible future interest in land

a) Adverse Claims

2. Adverse claim - A claim is adverse when: [Sec. 70, par. 1, P.D. 1529]

a. Claimant’s right or interest in registered land is adverse to the registered owner;

b. Such right arose subsequent to date of original registration; and
c. No other provision is made in the Decree for the registration of such right or claimant

Requisites for registration of an adverse claim:

a. The adverse claimant must give a statement of the following in writing:

1. His alleged right or interest

2. How and under whom such alleged right or interest is acquired
3. The description of the land in which the right or interest is claimed and
4. The number of the certificate of title
 b. The statement must be:

1. Signed by the adverse claimant

2. Sworn before a notary public

c. The statement must also state his residence or the place to which all notices may be served upon him
[Lozano v Ballesteros, G.R. No. 49470 (1991)].

Duration of an adverse claim

a. 30 days from the date of registration.

b. After that, the annotation of adverse claim may be cancelled upon filing of a verified
petition by the party in interest.

When cancelled, no second adverse claim based on the same ground may be registered by
the same claimant.

Adverse claim is not ipso facto cancelled after 30 days, hearing is necessary.

3. Sale on Execution or For Taxes or Assessments

Execution sale

a. To enforce a lien of any description on registered land, any execution or affidavit to enforce such lien
shall be filed with Register of Deeds where the land lies
b. Register in the registration book & memorandum upon proper certificate of title as adverse claim or
as an encumbrance
c. To determine preferential rights between 2 liens: priority of registration of attachment

4. Tax sale

1. Sale of land for collection of delinquent taxes and penalties due the Government
2. In personam (all persons interested shall be notified so that they are given opportunity to be heard)

a. Notice to be given to delinquent taxpayer at last known address

b. Publication of notice must also be made in English, Spanish & local dialect & posted in a
public & conspicuous place in place wherein property is situated & at the main entrance of the
provincial building

3. Sale cannot affect rights of other lien holders unless they are given the right to defend their rights: due
process must be strictly observed
4. Tax lien superior to attachment

Note: No need to register tax lien because it is automatically registered once the tax accrues. However,
sale of registered land to foreclose a tax lien needs to be registered.

Process of Registration

1. Officer’s return shall be submitted to Register of Deeds together with duplicate title
2. Register in the registration book
3. Memorandum shall be entered in the certificate as an adverse claim or encumbrance
4. After the period of redemption has expired & no redemption (2 years from registration of auction sale) is
made: cancellation of title and issuance of a new one
5. Before cancellation, notice shall be sent to registered owner: to surrender title & show cause why it shall
not be cancelled

Note: Actual knowledge of a person is equivalent to registration as against him

b) Notice of Lis Pendens - Notice of Lis Pendens - Literally means “pending suit.” It is an announcement to the
whole world that a particular real property is in litigation. The inscription serves as a warning that one who
acquires an interest over litigated property does so at his own risk, or that he gambles on the result of the litigation
over the property [Marasigan v. Intermediate Appellate Court, G.R. No. L-69303 (1987)].

When notice of lis pendens is proper:

1. To recover possession of real estate

2. To quiet title
3. To remove clouds upon the title thereof
4. For partition
5. Other proceedings of any kind in court directly affecting the title to land or the use or occupation
thereof or the buildings thereon
When notice of lis pendens is NOT proper:

1. Proceedings for the recovery of money judgments

2. Attachments
3. Proceedings on the probate of wills
4. Administration of the estate of deceased persons
5. Levies on execution
6. Foreclosure

Process of Registration:

By Memorandum or Notice stating:

c. The institution of the action or proceeding

d. The court wherein the same is pending
e. The date of the institution of the action
f. Reference to the number of the certificate of title
g. Adequate description of the land affected and registered owner thereof

Other parties who need to register:

A. Assignee in involuntary proceeding for insolvency

1) Duty of the officer serving notice to file a copy of the notice to the Register of Deeds where the
property of debtor lies
2) Assignee elected or appointed by court shall be entitled to entry of new certificate of
registered land upon presentment of copy of assignment with bankrupt’s certificate of title
(duplicate)
3) New certificate shall note that it is entered to him as assignee or trustee in insolvency
proceedings

B. Government in eminent domain

1. Copy of judgment shall be filed in the Register of Deeds which states description of property,
certificate number, interest expropriated, nature of public use
2. Memorandum shall be made or new certificate of title shall be issued

Effect of registration

1. Impossibility of alienating the property in dispute during the pendency of the suit – may be
alienated but purchaser is subject to final outcome of pending suit
2. Register of Deeds is duty bound to carry over notice of lis pendens on all new titles to be issued

Cancellation of lis pendens [Sec. 77, P .D. 1529]

Under Sec. 19, Rule 13 of the Rules of Court, a notice of lis pendens may cancelled on the following
grounds:

a. The annotation was for the purpose of molesting the title of the adverse party;
b. The annotation is not necessary to protect the title of the party who caused it to be recorded.

Requisites:

a. Before final judgment

b. Upon order of the court
c. Upon Action by the Register of Deeds at the instance of the party that caused the registration or upon
verified petition of the latter; an Must be due to the grounds mentioned [Pena].

H. Non-Registrable Properties - Section 2, Article XII, 1987 Constitution. 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 other natural resources are owned by the State. With the exception of
agricultural lands, all other natural resources shall not be alienated. The classification of public lands is an
exclusive prerogative of the Executive Department of the Government 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
.

A. Civil Code provisions dealing with non-registrable properties

1. Properties of public dominion [Art. 420, Civil Code]

 a) Those intended for public use, such as roads, canals, rivers, torrents, ports and bridges constructed by the
State, banks, shores, roadsteads, and others of similar character;
b) Those which belong to the State, without being for public use, and are intended for some public service or
for the development of the national wealth.

2. Waters under Art. 502, Civil Code

a. Rivers and natural beds

b. Continuous or intermittent waters of springs and brooks running in their natural beds and
the beds themselves
c. Waters rising continuously or intermittently on lands of public dominion
d. Lakes and lagoons formed by Nature on public lands, and their beds
e. Rain waters running through ravines or sand beds, which are also part of public dominion
f. Subterranean waters on public lands
g. Waters found within the zone of operation of public works, even if constructed by a contractor
h. Waters rising continuously or intermittently on lands belonging to private persons, to the
State, to a province, or to a city or municipality from the moment they leave such lands
i. The waste waters of fountains, sewers, and public establishments

B. Specific kinds of non- registrable properties or lands

1. Forest or timberland, public forest, forest reserves

2. National parks - Under the present Constitution, national parks are declared part of the public
domain, and shall be conserved and may not be increased nor diminished, except by law [Republic v AFP
Retirement and Separation Benefits System, G.R. No. 180463 (2013)].

3. Mangrove swamps - Mangrove swamps or mangroves should be understood as comprised within

the public forests of the Philippines as defined in Sec. 1820, Administrative Code of 1917 [Director of
Forestry v. Villareal, G.R. No. L-32266 (1980)].

4. Mineral lands - Both under the 1987 Constitution and Sec. 2 of the Public Land Act, mineral lands
are not alienable and disposable [Lepanto Consolidated Mining Co. v. Dumyung, G.R. No. L-31666
(1979)].

5. Foreshore land and seashore and reclaimed lands - Seashore, foreshore, and/or portions of
territorial waters and beaches, cannot be registered. Even alluvial formation along the seashore is part of
public domain [Aquino citing Dizon v. Rodriguez, G.R. Nos. L-20300- 01 (1965)].

6. Lakes - Lakes are part of public dominion [Art. 502 (4), Civil Code].

7. Creeks and Streams - A dried up creek bed is property of public dominion [Fernando v . Acuna,
G.R. No. 161030 (2011)].

8. Military or Naval Reservations - The reservation made segregates it from the public domain and
no amount of time in whatever nature of possession could have ripen such possession into private
ownership [Republic v. Marcos, G.R. No. L-32941 (1973)].

9. Watershed - The Constitution expressly mandates the conservation and utilization of natural
resources, which includes the country’s watershed [Tan v. Director of Forestry, G.R. No. L-24548
(1983)].

10. Grazing lands - While the 1987 Constitution does not specifically prove that grazing lands are not
disposable, yet if such lands are part of a forest reserve, there can be no doubt that the same are incapable
of registration [Aquino, citing Director of Lands v. Rivas, G.R. No. L- 61539 (1986)].

11. Previously titled land - Proceeds from the indefeasibility of the Torrens title.

12. Alluvial deposit along river when man-made - Such deposit is really an encroachment of a
portion of the bed of the river, classified as property of the public domain under Art. 420 (1) and Art. 502
(1) of the Civil Code, hence not open to registration [Republic v. CA, G.R. No. L-61647 (1984)].

13. Reservations for public and semi- public purposes

Sec. 14, Chapter 4, Book III of EO No. 292 provides that the President shall have the power to
reserve for settlement or public use, and for specific public purposes, any of the lands of public
domain, the use of which is not otherwise directed by law.

The land registration court has no jurisdiction over non-registrable property and cannot validly
adjudge the registration of title thereof in favor of a private applicant [Peña].
 Thus, where it has so been adjudged, the river not being capable of private appropriation or
acquisition by prescription, the title thereto may be attacked, either directly or collaterally, by the
State which is not bound by any prescriptive period provided by the Statute of Limitation.

C. Patrimonial Property

Refers to property that is open to disposition by the Government, or otherwise property pertaining to the
national domain, or public lands.

The property of provinces, cities, and municipalities is divided into property for public use and
patrimonial property [Art. 423, Civil Code].

Property for public use, in the provinces, cities, and municipalities, consist of the provincial roads, city
streets, municipal streets, the squares, fountains, public waters, promenades, and public works for public
service paid for by said provinces, cities, and municipalities. All other property possessed by any of them
is patrimonial and shall be governed by the Civil Code, without prejudice to the provisions of special laws
[Art. 424, Civil Code].

I. Dealings With Unregistered Lands

No deed, conveyance, mortgage, lease, or other voluntary instrument affecting land not registered under
the Torrens system shall be valid, except as between the parties thereto, unless such instrument shall have
been recorded in the manner herein prescribed in the office of the Register of Deeds for the province or
city where the land lies [Sec. 113, par. 1, P.D. 1529].

Effects of Transactions covering Unregistered Land

1. As between the parties – The contract is binding and valid even if not registered
2. As among third persons – There must be registration for the transaction to be binding against third
persons

Primary Entry Book and Registration Book - The Register of Deeds for each province or city shall keep a
Primary Entry Book and a Registration Book.

1. The Primary Entry Book shall contain, among other particulars:

1. Entry number
2. Names of the parties
3. Nature of the document
4. Date, hour and minute it was presented and received
2. The Registration Book – Provides spaces whereon the annotation is made after the instrument has
been entered in the Primary Entry Book

Process of Registration

1. Registration is by way of annotation

2. The instrument dealing with unregistered land is presented before the Register of Deeds
3. The Register will then determine if it can be registered:

If, on the face of the instrument, it appears that it is sufficient in law, the Register of Deeds shall
forthwith record the instrument

2. In case the Register of Deeds refuses its administration to record, he shall advise he party in interest in
writing of the ground or grounds for his refusal.

The latter may appeal the matter to the Commissioner of Land Registration. Recording by the Register of
Deeds is ministerial. Recording shall be without prejudice to a third party with a better right [Sec. 113, P.D.
1529].

Better right - Refers to a right which must have been acquired by a third party independently of the
unregistered deed, such, for instance, as title by prescription, and that it has no reference to rights acquired
under that unregistered deed itself [Peña].

Involuntary Dealings in Unregistered Lands - P.D. 1529 now permits the registration of involuntary
dealings in unregistered lands.

Tax sale, attachment and levy, notice of lis pendens, adverse claim and other instruments in the nature of
involuntary dealings with respect to unregistered lands, if made in the form sufficient in law, shall likewise be
admissible to record under Sec. 113 [Sec. 113 (d), P.D. 1529].

J. Assurance Fund
1. Nature of Assurance Fund

Upon the entry of a certificate of title in the name of the registered owner, and also upon the original
registration on the certificate of title of a building or other improvements on the land covered by said
certificate, as well as upon the entry of a certificate pursuant to any subsequent transfer of registered land,
there shall be paid to the Register of Deeds one- fourth of one per cent of the assessed value of the real
estate on the basis of the last assessment for taxation purposes, as contribution to the Assurance Fund.
Where the land involved has not yet been assessed for taxation, its value for purposes of this decree shall
be determined by the sworn declaration of two disinterested persons to the effect that the value fixed by
them is to their knowledge, a fair valuation.

Nothing in this section shall in any way preclude the court from increasing the valuation of the property
should it appear during the hearing that the value stated is too small [Sec. 93, P.D. 1529].

2. Conditions for Compensation from Assurance Fund (IMPORTANT)

Requisites:

a. That a person sustains loss or damage, or is deprived of any estate or interest in land;
b. On account of the bringing of land under the operation of the Torrens System arising after original
registration;
c. Through fraud, error, omission, mistake or misdescription in a certificate of title or entry or
memorandum in the registration book;
d. Without negligence on his part; and
e. Is barred or precluded from bringing an action for the recovery of such land or estate or interest
therein.

Reversion

Action instituted by the government, thru the Solicitor General in all cases where lands of public domain
are held in violation of the Constitution or were fraudulently conveyed. Indefeasibility of title,
prescription, laches, and estoppel do not bar reversion suits.

3. Prescriptive Period

Any action for compensation against the Assurance Fund by reason of any loss, damage or deprivation of
land or any interest therein shall be instituted within a period of six years from the time the right to bring
such action first occurred:

Requisites:

1. That the right of action herein provided shall survive to the legal representative of the person
sustaining loss or damage, unless barred in his lifetime; and
2. That if at the time such right of action first accrued the person entitled to bring such action was a
minor or insane or imprisoned, or otherwise under legal disability, such person or anyone claiming
from, by or under him may bring the proper action at any time within two years after such disability
has been removed, notwithstanding the expiration of the original period of six years first above
provided [Sec. 102, P.D. 1529].

K. Reconstitution of Title

1. The restoration of the instrument which is supposed to have been lost or destroyed in its original form
and condition, under the custody of the Register of Deeds
2. To have the same reproduced after proper proceedings in the same form they were when the loss or
destruction occurred [Heirs of Pedro Pinote v. Dulay, G.R. No. 56694 (1990)].

Kinds:

1. Judicial – Requisites:

1. A petition is filed before the RTC

2. Petition is published in the Official Gazette for 2 consecutive issues and posted on main entrance of
municipality for at least 30 days before hearing
3. Hearing is then conducted
4. Court may then order reconstitution if meritorious

2. Administrative, which may be availed only in case of:

a. Substantial loss or destruction of original land titles due to fire, flood, or other force majeure as
determined by the LRA
 b. Number of certificates of title lost or damaged should be at least 10% of the total number in possession of
the Register of Deeds
c. In no case shall the number of certificates of title lost or damaged be less than 500; and

d. Petitioner must have the duplicate copy of the certificate of title [R.A. No. 6732]

Wills and Succession

A. General Provisions

Art. 774, NCC - Succession is a mode of acquisition by virtue of which the property, rights and obligations,
to the extent of the value of the inheritance, of a person are transmitted through death to another or
others either by will or by operation of law.

Kinds of Succession:

1. Testamentary
2. Legal or Intestate
3. Mixed
4. Compulsory

Scope of Inheritance: GR

1. Art. 776, NCC - All the property, rights and obligations (to the extent of the inheritance) of a
person which are not extinguished by such person’s death.
2. Art. 781, NCC - The property and the transmissible rights and obligations which have accrued to
item (1) above since the opening of the succession.

Exceptions:

1. Art. 1311, NCC - Rights and obligations which are not transmissible and Intransmissible by nature

a. Refers to rights and obligations which are strictly personal (intuitu personae)

1. Those relating to family relations

2. Those arising from public law
3. Those which involve or require the personal skills, qualifications, characteristics
or circumstances of a particular individual
4. Criminal responsibility

b. Intransmissible by stipulation
c. Intransmissible by provision of law

1) Usufruct [Art. 603, Civil Code]

2) Agency [Art. 1919, Civil Code]
3) Commodatum [Art. 1939, Civil Code]

2. Monetary debts left by the decedent are intransmissible in the sense that they are paid from the
estate of the decedent and only the net estate or remainder goes to the heirs. If the decedent’s
estate is not sufficient to pay his debts, his heirs cannot be held liable for said debts in their
personal capacity [Rule 88-90, Rules of Court].

B. Rules on Opening of Succession

1. Art. 777, NCC - The rights to succession are transmitted from the moment of the death of the decedent.

Implications:

a. Art. 2263, NCC - The law in effect at the time of death of the decedent governs the succession.
b. The heir becomes the owner of his share in the inheritance as well as all fruits which accrue to
such share upon the death of the decedent;
c. Upon the death of the decedent, heirs may immediately possess, administer and dispose of
their shares in the estate (in the absence of existing debts/claims against the estate);
d. Emnace v. CA, 2001 - Since succession takes place by operation of law at the moment of the
death of the decedent, the heirs can sue upon the rights of the decedent, without having to be
appointed executor or administrator and without need of a judicial declaration of their status
as heirs.
 e. Gayon v. Gayon, 1970 - Heirs may also be sued without a previous declaration of heirship,
provided there is no pending special proceeding for the settlement of estate of the decedent
f. Art. 533, NCC - The possession of hereditary property is deemed transmitted to the heir
without interruption and from the moment of death of the decedent, in case the inheritance is
accepted.
g. Estate taxes accrue upon death of the decedent, even if the heirs come into possession only
later.

2. A person may be “presumed” dead for the purpose of opening his succession after absence of:

No. of years Age at disappearance

10 years 75 years old and below
5 years 76 years old and above

Art. 390-392, NCC - A person who has gone missing for at least four years:

1. While on board a lost sea vessel or airplane; or

2. While taking part in war as a member of the armed forces; or
3. Has been in danger of death under other circumstances shall be presumed dead for the
purpose of division of the estate.

If the absent person appears, such person may recover the properties in the condition in which they may
be found or the price of any alienated property may be given to said returning person.

C. Subjects of Succession:

1. Art. 775, NCC - Decedent – person whose property is transmitted through succession,
whether or not he left a will.
2. Art. 775, NCC - Testator – a decedent who left a will.
3. Successor/Heir – person who succeeds to the property of the decedent.

Kinds of Successors/Heirs:

1. Compulsory Heirs;
2. Voluntary or Testamentary Heir;
1. Instituted heir by universal title
2. Art. 782, NCC - Devisees are persons to whom gifts of real property are given by
virtue of a will.
3. Art. 782, NCC - Legatees are persons to whom gifts of personal property are given
by virtue of a will.
3. Legal or Intestate Heirs.

Note: Art. 854, NCC - In case of preterition, the distinction between an instituted heir by universal title
and legatee/devisee is significant. Preterition annuls the institution of heir by universal title. It does not
affect the institution of legatees and devisees provided that the legitimes are not impaired.

Compulsory heir Legatee/Devisee

Represents the juridical personal obligations not Does not represent regardless of the legacy or
extinguished by death device’s value

Succeeds to the remainder of the decedent’s Succeeds only to the determinate thing or
properties after all the debts and all the legacies quantity which is mentioned in the legacy or
and devices have been paid device

Can exist in either testamentary or intestate Can exist only in testamentary succession
succession

B. Testamentary Succession

1. General Provisions

Art. 783, NCC - Definition of a will: 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.

1. Kinds of Wills:
 1. Art. 804-808, NCC: Notarial – an ordinary or attested will, which must comply with the
requirements of the law.
2. Art. 810, NCC: Holographic – a will entirely written, dated and signed by the hand of the testator.

Other Types of Wills

Joint Wills: 1. A single testamentary instrument;

2. Which contains the wills of two or more persons;
3. Jointly executed by them;
4. Either for their reciprocal benefit or for the benefit of a third person.

Filipinos cannot make Joint Wills - Joint wills executed by Filipinos, whether in the
Philippines or abroad, are prohibited.

Note: Separate documents, each serving as one independent will (even if written on the
same sheet) are not considered joint wills.
Mutual 1. Executed pursuant to an agreement between two or more persons;
Wills: 2. Jointly executed by them; and
3. Either for their reciprocal benefit or for the benefit of a third person.

This is prohibited under Article 818, Civil Code.

Reciprocal 1. Testators name each other as beneficiaries in their own wills (there are therefore 2
Wills: separate documents);
2. Under similar testamentary plans – valid.

2. Characteristics of a Will

1. Purely personal

GR: The making of a will is a strictly personal act. Thus,

• It cannot be left in whole or in part to the discretion of a third person, or

• It cannot be accomplished through an agent or attorney.

XPN:

a) Art. 785, NCC - What cannot be delegated to 3rd persons:

i. designation of heirs, devisees, and legatees

ii. duration/efficacy of designation
iii. determination of portions, when referred to by name

b) Art. 786, NCC - What may be entrusted to 3rd persons:

i. Designation of person/institution falling under a class specified by testator

ii. Manner of distribution of property specified by testator – Art. 786, NCC.

Note: The testator must first specify the class and the amount of property for proper
delegation.
2. Free and intelligent – Art. 839, NCC: Execution of a will tainted by any vices affecting the free will of
the testator can cause its disallowance.

3. Solemn or formal – Art. 839, NCC: If the formalities of a will required by law are not complied with,
it will be disallowed.

4. Revocable and ambulatory – Art. 828, NCC: A will can be revoked at any time before the testator’s
death.

5. Mortis causa – Art. 783, NCC: It takes effect upon the testator’s death

6. Individual – Art. 818, NCC: Prohibition against joint wills.

7. Executed with animus testandi Intent to dispose of the property.

8. Unilateral act - Does not involve an exchange of values or depend on simultaneous offer and
acceptance.

9. Dispositive - Seangio v. Reyes, 2006: Even in the absence of dispositive provisions, a will
disinheriting a compulsory heir is still a dispositive will because a disinheritance has the effect of
 disposing the legitime of the disinherited compulsory heir in favor of other compulsory heirs.

Exception: Non-dispositive wills. e.g. A will recognizing an illegitimate child

10. Statutory grant - Permitted only by law, not a constitutional right.

µ Allowance and Disallowance of Wills

Art. 838, NCC - Probate Requirement: No will shall pass either real or personal property unless it is
proved and allowed in accordance with the Rules of Court.

Art. 838, NCC - Definition of a Probate: A proceeding in rem required to establish the validity of a will and
in order to pass real or personal property. The testator himself may, during his lifetime, petition the court
having jurisdiction for the allowance of his will.

Kinds of Probate: Matters to be proved in probate:

1. Post-mortem: after death 1. Identity
2. Ante-mortem: during the testator’s lifetime 2. Due Execution
3. Capacity of the Testator
Note: Probate of a will is mandatory.

Art. 839, NCC - Scope of Probate Proceedings.

GR: The probate court cannot inquire into the intrinsic validity of testamentary provisions. Only the extrinsic
validity of such wills may be examined.

XPN:

Acain v. IAC, 1987 - When practical considerations demand that the intrinsic validity of the will be
resolved: When the will is intrinsically void on its face (e.g., when there is clearly a preterition) such that
to rule on its formal validity would be a futile exercise.

Valera v. Inserto, 1987 - Claimants are all heirs and they consent, either expressly or impliedly, to the
submission of the question of intrinsic validity to the court.

Pastor v.CA, 1983 - Probate court may pass upon the title to a property, but such determination is
provisional and not conclusive, and is subject to the final decision in a separate action to resolve title.

Portugal v. Portugal-Beltran, 2005 - Probate court may decide on the ownership of a property when the
estate contains only one property to be adjudicated upon.

5. Testamentary Capacity

Time of Determining Capacity - Art. 798, NCC: Capacity to make a will is determined as of the time of
making thereof.

Art. 801, NCC - Supervening incapacity does not invalidate an effective will. Likewise, a supervening
capacity does not validate the will of an incapable.

Requisites for Capacity to Make a Will:

1. Art. 796, NCC - The testator must not be expressly prohibited by law to make a will.
2. Art. 797, NCC - The testator must be at least 18 years old; and
3. Art. 798, NCC - The testator must be of sound mind at the time of execution.

Test of soundness of mind: to be of sound mind, the testator must know – Art. 799, NCC:

1. The nature of the estate to be disposed of;

2. The proper objects of his bounty;
3. The character of the testamentary act.

GR: Soundness of mind is presumed – Art. 800, NCC.

 XPN:

1. Art. 800, NCC - When the testator, one month or less before the execution of the will, was
publicly known to be insane.
2. Torres v. Lopez, 1926 - When the testator executed the will after being placed under guardianship
or ordered committed, in either case, for insanity under Rules 93 and 101 of the Rules of Court,
and before said order has been lifted.

Effect of Final Decree of Probate, Res Judicata on Formal Validity - Mercado v. Santos, 1938:

The probate of a will by the probate court having jurisdiction thereof is usually considered as
conclusive as to its due execution and validity and is also conclusive that the testator was of sound
and disposing mind at the time when he executed the will, and was not acting under duress,
menace, fraud, or undue influence, and that the will is genuine and not a forgery.

Grounds for Denying Probate: Art. 839, NCC

1. If the signature of the testator was procured by fraud;

2. If it was procured by undue and improper pressure and influence, on the part of the beneficiary or
some other person;
3. If the testator acted by mistake or did not intend that the instrument he signed should be his will
at the time affixing his signature thereto;
4. If the testator was insane or otherwise mentally incapable of making a will at the time of its
execution;
5. If the formalities required by law have not been complied with; or
6. If it was executed through force or under duress, or the influence of fear, or threats.

3. Non-Delegability of a Testamentary Power

Purely personal

GR: The making of a will is a strictly personal act. Thus, It cannot be left in whole or in part to the discretion of
a third person, or It cannot be accomplished through an agent or attorney.

XPN: Art. 785, NCC - What cannot be delegated to 3rd persons:

1. Designation of heirs, devisees, and legatees

2. Duration/efficacy of designation
3. Determination of portions, when referred to by name

Art. 786, NCC - What may be entrusted to 3rd persons:

1. Designation of person/institution falling under a class specified by testator

2. Manner of distribution of property specified by testator – Art. 786, NCC.

Note: The testator must first specify the class and the amount of property for proper delegation.
4. Applicable Law as to Form and Substance of a Will

Rules of construction and interpretation – Art. 788-795, NCC: Testacy is preferred to intestacy. The intent
of the testator is paramount and must be given effect as far as legally possible.

Aspect of the will Governing law

Formal validity Art. 795, NCC - Law in force at the time the will was executed.

Intrinsic validity Arts. 16 and 2263, NCC - Law of decedent’s nationality at the time of his death.

Aspects of the will governed by the national law of the decedent:

1. Order of succession;
2. Amount of successional rights;
3. Intrinsic validity of testamentary provisions; and
4. Capacity to succeed [Art. 16, Civil Code]

Governing Law as to Place of Execution of Will:

Testator Place of execution Governing law

of will
 Filipino PH Philippine Law (Art. 16, NCC)

Outside of PH 1.Philippine Law (Art. 815, NCC) or

2.Law of the country in which it is executed (Art. 17, NCC)

Alien PH 1.Philippine Law; or

2.Law of the country of which testator is a citizen or subject

(Art. 17, NCC)

Outside of PH 1.Philippine Law (Art. 816, NCC); or

2.Law of the testator’s country; or

3.Law of the place where the testator resides; or

4.Law of the country where the will is executed (Art. 17, NCC)

6. Form of Notarial and Holographic Wills

µ Notarial Will

GR: Art. 804, NCC

1. The will must be in writing;

2. It must be in a language or dialect known to the testator.

Applicable Laws as to Formal Validity:

Applicable law

As to time Art. 795, NCC - Law in force at the time the will was executed.

As to place Art. 17, NCC - Law of the country in which the will was executed.

Formal requirements for notarial wills:

1. Subscribed to by the testator at the end;

2. Attested and subscribed by 3 or more witnesses in the presence of the testator and of one another;
3. Marginal signatures;
4. Page numbers in letters; and
5. Acknowledged before a notary public.

Note: Unlike in holographic wills, there is no requirement that an attested will should be dated.

Formal requirements
1. Marginal GR: Art. 805, NCC - Testator or his representative shall write his name, and the
signatures witnesses shall sign every page except the last page.

Exceptions:

1. When the will consists of only one page;

2. When the will consists of only two pages, the first of which contains all
dispositions and is signed at the bottom by the testator and the witnesses, and the
second page contains only the attestation clause duly signed at the bottom by the
witnesses - Abangan v. Abangan, 1919.
3. The use of thumbprint was allowed - Matias v. Salud, 1958.
4. The inadvertent failure of one witness to affix his signature to one page of a
testament, due to the simultaneous lifting of two pages in the course of signing, is
not per se sufficient to justify denial of probate Icasiano v. Icasiano, 1964.

2. Page numbers Art. 805, NCC - All the pages of the will shall be numbered correlatively in letters placed
on the upper part of each page (i.e. Page One of Five Pages).
3. Acknowledge Art. 805,NCC - The certification of acknowledgement need not be signed by the notary in
d before a the presence of the testator and the witnesses - Javellana v. Ledesma, 1995.
notary public
 4. Additional 1. Art. 807, NCC - Deaf Mute
requirements
for 1. Testator must personally read the will; or
handicapped 2. Testator shall personally designate two persons to read the contents and
testators communicate it to him in some practicable manner.

2. Art. 808, NCC – Blind.

1. The will shall be read to the testator twice by one of the subscribing witnesses and
by the notary public acknowledging the will.
2. A testator suffering from glaucoma may be considered as legally blind -.
3. The provision requiring reading of a will twice to a blind testator also applies to an
illiterate testator - In Re: Probate of the Will of Cosico, 2021.

5. Subscribed by Art. 820, NCC - Qualifications

3 or more
witnesses in 1. Of sound mind;
the presence 2. Aged 18 years or over;
of the testator 3. Not blind, deaf or dumb; and
and of one 4. Able to read and write.
another
Art. 821, NCC – Disqualifications.

1. Person not domiciled in the Philippines;

2. Those who have been convicted of falsification, perjury, or false testimony.

Art. 824, NCC - Creditors may be witnesses.

Art. 822, NCC - Supervening incompetency shall not prevent the allowance of the will.

µ Holographic will

Formal Requirements:

a) Art. 804, NCC - In writing.

b) Art. 804, NCC - In a language known to the testator; and
c) Art. 810, NCC - Entirely written, dated and signed in the hand of the testator himself.

Art. 811, NCC - Witnesses Required for Probate.

1. At least one witness who knows the handwriting and signature of the testator; explicitly declare that it is
the testator’s;
2. If contested – at least 3 of such witnesses;
3. In the absence of a competent witness, expert testimony may be resorted to.

GR: The holographic will itself must be presented for probate - Gan v. Yap, 1958.

XPN: If there is a photostatic copy or xerox copy of the holographic will, it may be presented for probate -
Rodelas v. Aranza, 1982.

Additional Dispositions:

Art. 812, NCC - In holographic wills, the dispositions of the testator written below his signature must be
dated and signed by him in order to make them valid as testamentary dispositions.

Art. 813, NCC - When a number of dispositions appearing in a holographic will are signed without being
dated, and the last disposition has a signature and date, such date validates the dispositions preceding it,
whatever be the time of prior dispositions.

Insertion, Cancellation, Erasure or Alteration

Art. 814, NCC- Testator must authenticate by his full signature. If such change is not authenticated by
the testator, such change is considered not made.

Thus, “the will is not thereby invalidated as a whole, but at most only as regards the particular words
erased, corrected, or inserted” - Kalaw v. Relova, 1984.
 Note, however, that in the case of Kalaw v. Relova, the alteration involved the designation of the
testator’s sole heir. In this case, the holographic will had only one substantial provision, which was altered
by substituting the original heir with another, but which alteration did not carry the requisite of full
authentication by the full signature of the testator, the effect must be that the entire will is voided or
revoked for the simple reason that nothing remains in the will after that which could remain valid.

7. Witnesses to a Notarial Will (Qualification and Disqualifications)

GR XPN

Devises or legacies in favor of an interested witness or If there are three other competent witnesses, the
his or her spouse, parent, or child will be void devise or legacy shall be valid and the interested
witness shall be treated as a mere surplusage

Note: A survivorship agreement is not a will - Vitug v. CA, 1990.

● A survivorship agreement is a contract where two or more parties agree that, upon the death of one of
the co-owners, the title to the property shall vest to the survivor. Said contract imposes a mere obligation
with a term (i.e. the death of one of the co- owners.)

●  It is a valid contract but its effect may be illegal if it is used as a mere cloak to hide an inofficious
donation, to transfer property in fraud of creditors, or to defeat the legitime of a compulsory heir.

●  A survivorship agreement is NOT a will because it does not pertain to a testator but to a co-ownership.
Therefore, it need not follow the solemnities of will and it need not be probated.

●  A survivorship agreement is neither a donation inter vivos or mortis causa, but instead is an aleatory
contract.

Effect of Insertion Written by Another Person on the Validity of a Holographic Will:

When made effect

After the execution, without Insertion considered not written. Validity cannot be defeated by the malice or
consent of testator caprice of a third person

After execution, with consent Will is valid, insertion is void

Contemporaneous to the Will is void because it is not written entirely by the testator
execution of the will

8. Conflict Rules

9. Modes of Revocation of Wills and Testamentary Dispositions

Art. 828, NCC: A will may be revoked by the testator at any time before his death.

Art. 830, NCC: Modes of Revocation

By implication of 1. Preterition [Art. 854, Civil Code]

law; 2. Legal separation [Art. 63, Family Code]
3. Unworthiness to succeed [Art. 1032, Civil Code]

2. By the execution of a will, codicil or other writing executed as provided in the case of
wills (may be total or partial); or
3. By burning, tearing, canceling, or obliterating the will with the intention of revoking it,
by the testator himself, or by some other person in his presence, and by his express
direction.

The act contemplating revocation must be done at any time before the death of the testator.
The right of revocation cannot be waived or restricted [Art. 828, Civil Code].

Note: Even if a holographic will was not intended to be revoked, unless a xerox copy exists,
it can no longer be proved.
By some will, Codicil and Incorporation by Reference: Codicil: Art. 825-826, NCC:
codicil, or other
writing executed 1. It is a supplement or addition to a will;
as provided in the 2. Made after the execution of a will;
case of wills; or 3. Annexed to be taken as a part of the will;
 4. By which any disposition made in the original will is explained, added to, or
altered;
5. In order that it may be effective, it shall be executed as in the case of a will.

Note: A codicil must be in the form of a will – can have a notarial codicil attached to a
holographic will, and a holographic codicil attached to a notarial will.

Incorporation by Reference: Requisites [Art. 827, Civil Code]

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 witnesses on each and every page, except
in case of voluminous books of account or inventories.

Note: Not available in holographic wills.

By burning, May be done by the testator himself or by some other person. However, when the burning,
tearing, tearing, cancelling, or obliterating the will was done by some other person, it must with the
cancelling, or presence AND express direction of the testator.
obliterating the
will with When it was done in the presence of the testator but without his express direction, the will
the intention of may still be established as it is not considered as revoked under the law. When it was done
revoking it. with the express direction of the testator but in his absence, the will may still be established
like in the first case. The wills in both situations is existing and not revoked.

In other words, the burning, tearing, cancelling, or obliterating the will by some other
person must be done in the presence of the testator AND by his express direction.

Law Governing Revocation [Art. 829, Civil Code]:

Place of Testator’s domicile Governing law

revocation

PH Philippines, or some other PH Law

country
Outside PH Philippines - This situation is 1. Law of Domicile - Philippine law; or
not governed by Art. 829 2. Law of Place of Revocation; or
3. Law of Place of Execution of will

Foreign country 1. Law of the Place of Execution of Will; or

2. Law of the place in which the testator had his domicile
at the time of revocation

Principle of Instanter - Revoking clause in the 2nd will is not testamentary in character but operates to revoke
the prior will instanter (immediately) upon the execution of the will containing it. The revocation of the 2nd will
does not revive the 1st will which has already become a nullity.

Revocation Disallowance

Voluntary act of the testator Given by judicial decree

With or without cause Must always be for a legal cause
May be partial or total Always total, except when the ground is fraud or influence which
affects only certain portions of the will

a) Effect on the Recognition of a Non-Marital Child - Art. 834, NCC - The recognition of an illegitimate
child does not lose its legal effect even though the will wherein it was made should be revoked.

b) Theory of Dependent Relative Revocation

 GR: Art. 832, NCC - A revocation made in a subsequent will shall take effect, even if the new will
should become inoperative by reason of the incapacity of the heirs, devisees or legatees designated
therein, or by their renunciation.

XPN: Doctrine of Dependent Relative Revocation - Molo v. Molo, 1951.

The rule that where the act of destruction is connected with the making of another will so as to fairly raise
the inference that the testator meant the revocation of the old to depend upon the efficacy of the new
disposition intended to be substituted, the revocation will be conditional and dependent upon the efficacy
of the new disposition; and if for any reason, the new will intended to be made as a substitute is
inoperative, the revocation fails and the original will remain in full force.

The failure of the new testamentary disposition upon whose validity the revocation depends is equivalent
to the non-fulfillment of a suspensive condition and hence prevents the revocation.

c) Revocation Based on a False Cause

Art. 833, NCC: False Cause/Illegal Cause - A revocation based on a false cause or illegal cause is null
and void.It must appear from the will that the testator is revoking because of the cause which he did not
know was false.

10. Heirs

a) Compulsory Heirs

Art. 887, NCC - Classes of Compulsory Heirs:

1. Primary: Legitimate Children (LC) and Legitimate Descendants (LD) with respect to their Legitimate
Parents and Ascendants
2. Secondary: Those who succeed only in the absence of the primary compulsory heirs:

a) Legitimate Parents (LP) and Legitimate Ascendants (LA), with respect to their Legitimate
Children and Descendants. (They will inherit only in default of legitimate children and their
descendants)

b) Illegitimate Parents (ILP) with respect to their Illegitimate Children (ILC). (They will inherit
only in default of the illegitimate and legitimate children and their respective descendants)

Note that other illegitimate ascendants are not included.

3. Concurring: Those who succeed together with the primary or the secondary compulsory heirs:

a) Surviving Spouse
b) llegitimate Children and Illegitimate Descendants

Specific Rules on Legitime:

1. Direct a) Arts. 978 and 985, NCC - Rule of Preference between lines.
Descending Line
 Those in the direct descending line shall exclude those in the direct ascending
and collateral lines; and
 Those in the direct ascending line shall, in turn, exclude those in the collateral
line.
 Rule of Proximity - Art. 962, NCC: The relative nearest in degree excludes the
farther one.

b) Art. 972, and 992, NCC - Right of representation ad infinitum in case of predecease,
incapacity, or disinheritance.

 For decedents who are Legitimate Children, only the Legitimate Descendants
are entitled to right of representation.
 For decedents who are Illegitimate Children, both the Legitimate and the
Illegitimate Descendants can represent, only with respect to the decedent’s
illegitimate parents.

c) If all the Legitimate Children repudiate their legitime, the next generation of
Legitimate Descendants may succeed in their own right.

2. Direct a) Rule of division between lines

Ascending Line
  Art. 986, NCC - The father and the mother shall inherit equally if both living.
One parent succeeds to the entire estate of the child if the other parent is dead.
 Art. 987, NCC -  In default of the mother and the father, the ascendants nearest
in degree will inherit.
 Art. 987, NCC - If there is more than one relative of the same degree but of
different lines, one half will go to the paternal ascendants and the other half to
the maternal ascendants.

b) Rule of equal division – Art. 987, NCC:

o The relatives who are in the same degree shall inherit in equal shares.

Reserva Troncal: Art. 891, NCC - The 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
such property as he may have acquired by operation of law for the benefit of relatives who are within the third
degree and who belong to the line from which said property came.

Concept of Reserva Troncal:

1. A descendant (prepositus) inherits or acquires property from an ascendant or from a brother or sister
(origin or mediate source) by gratuitous title.
2. The same property is inherited by another ascendant (reservista) or is otherwise acquired by him by
operation of law from the said descendant (prepositus).
3. The said ascendant (reservista) must reserve the property for the benefit of the relatives of the deceased
descendant within the third civil degree and who belong to the line from which the said property came
(reservatarios).

Requisites for Reserva Troncal [Chua v. CFI, G.R. No. L-29901 (1977)]:

1. That the property was acquired by a descendant (Prepositus) from an ascendant or from a brother or
sister (Origin or Mediate Source) by gratuitous title;
2. That the Prepositus died without (legitimate*) issue;
3. That the property is inherited by another ascendant (Reservista) by operation of law; and
4. That there are relatives within the 3rd degree (Reservatarios) belonging to the line from which said
property came.

Note: Only legitimate descendants will prevent the property from being inherited by the legitimate
ascending line by operation of law.

Two Views

1. Reserva Maxima: As much of the potentially reservable property as possible must be deemed
included in the part that passes by operation of law (maximizing the scope of the reserva)

2. Reserva Minima: every single property in the prepositus’s estate must be deemed to pass, partly by
will and partly by operation of law, in the same proportion that the part given by will bears to the part not
so given.

Either view is defensible, but Reserva Minima finds wider acceptance in the Philippines [Balane].

Extinguishment of the Reserva:

1. Loss of the reservable property

2. Death of the reservista
3. Death of all the relatives within the third degree belonging to the line from which the property came
4. Renunciation by the reservatarios, but a future reservatario is not bound by such renunciation → a
conditional extinguishment.

b) Institution of Heirs

A will shall be valid even though it —

1. should not contain an institution of an heir; or

2. such institution should not comprise the entire estate; or
3. the person so instituted should not accept the inheritance or be incapacitated to succeed.

Art. 841, NCC - In such cases, the testamentary dispositions made in accordance with law shall be complied
with and the remainder of the estate shall pass to the legal heirs.
Art. 842, NCC - Extent of Grant:

Freedom of disposition depends upon the existence, kind and number of compulsory heirs.

1. No compulsory heirs – Testator has full power of disposition

2. With compulsory heirs – Testator cannot disregard the rights of the compulsory heirs. Testator may
dispose of the free portion of his estate only.

Art. 856, NCC - Effect of Predecease of Heir:

Any heir who dies before the testator or is incapacitated to succeed or renounces the inheritance transmits
no rights of the testator to his own heirs. This is without prejudice to the rights of representation.

Manner of Distribution:

1. Art. 846, NCC - Heirs instituted without designation of shares shall inherit in equal parts.
2. Art.847, NCC - If the institution pertains to some heirs individually and others collectively, the
presumption is that all are individually instituted.
3. Art. 848, NCC - If siblings are instituted (whether full or half- blood), the presumption is that the
inheritance is to be distributed equally. This is different from the rules of distribution in intestate
succession.
4. Art. 849, NCC - If parents and children are instituted, they are presumed to have been instituted
simultaneously and not successively.

Note: By “unknown,” the Code actually means persons who could not be ascertained; a disposition in
favor of a stranger is valid.

Declaration of heirship as decided in Treyes v. Larlar, 2020: IMPORTANT

The rule which requires a prior determination of heirship in a separate special proceeding as a
prerequisite before one can file an ordinary civil action to enforce ownership rights acquired by virtue of
succession, is abandoned.

Henceforth, the rule is: unless there is a pending special proceeding for the settlement of the decedent's
estate or for the determination of heirship, the compulsory or intestate heirs may commence an ordinary
civil action to declare the nullity of a deed or instrument, and for recovery of property, or any other action
in the enforcement of their ownership rights acquired by virtue of succession, without the necessity of
a prior and separate judicial declaration of their status as such.

The ruling of the trial court shall only be in relation to the cause of action of the ordinary civil action, i.e.,
the nullification of a deed or instrument, and recovery or reconveyance of property, which ruling is
binding only between and among the parties.

(1) Limitations on the Institution of Heirs

(2) Collective Institution

(3) Proscription Against Successive Institution

(4) Institution Based on a False Cause

c) Substitution of Heirs

Art. 857, CC - Substitution - the appointment of another heir, so that he may enter into the inheritance in
default of the heir originally instituted.

Art. 862, NCC - The substitute shall be subject to the same charges and conditions imposed upon the
instituted heir, unless the testator has expressly provided the contrary, or the charges or conditions are
personally applicable only to the heir instituted.

(1) Causes of Substitution

Kinds of Substitution:
1. Art. 860, NCC - Brief or Compendious.

Brief – Two or more persons were designated by the testator to substitute for only one heir.

Compendious – One person is designated to take the place of two or more heirs.
 2. Art. 861, NCC – Reciprocal:

If the heirs instituted in unequal shares should be reciprocally substituted, the substitute shall acquire the share
of the heir who dies, renounces, or is incapacitated, unless it clearly appears that the intention of the testator
was otherwise. If there is more than one substitute, they shall have the same share in the substitution as the
institution.

Example (only 1 substitute): If two heirs are reciprocally substituted, then if one of them dies before the
testator dies, renounces, or turns out to be incapacitated, the other will get his share, regardless of whether or
not their shares are equal.

Example (more than 1 substitute): A is instituted to 1/3, B to 1/6, and C to 1⁄2. If C dies before the testator,
renounces or turns out to be incapacitated, then the other two will get his shares in the same proportion as in
the institution. A will get twice as much as B (because his share of 1/3 in the institution is twice the size of B’s
share of 1/6).
3. Art. 859, NCC - Simple Substitution.

The testator may designate one or more persons to substitute the heir/s instituted in case the heirs should:

1. Die before him;

2. Should not wish to accept the inheritance (repudiation); or
3. Should be incapacitated to accept the inheritance.

(2) Fideicommissary Substitution (Compared With Testamentary Trusts)

Art. 863, NCC - Fideicommissary Substitution: The testator institutes an heir with an obligation to
preserve and to deliver to another the property so inherited. The heir instituted to such condition is called the
First Heir or the Fiduciary Heir; the one to receive the property is the Second Heir or the Fideicommissary.

Art. 863-865: Requisites

1. A Fiduciary or first heir instituted is entrusted with the obligation to preserve and to transmit to a
Fideicommissary Substitute or second heir the whole or part of the inheritance.
2. The substitution must not go beyond one degree from the heir originally instituted.
3. The Fiduciary Heir and the Fideicommissary are living at the time of the death of the testator.
4. The fideicommissary substitution must be expressly made.
5. The fideicommissary substitution is imposed on the free portion of the estate and never on the legitime

PCIB v. Escolin, 1974 - In the absence of an obligation on the part of the first heir to preserve the property
for the second heir, there is no fideicommissary substitution.

Effects of predecease of the first heir/fiduciary or the second heir/fideicommissary:

Situation 1: Art. 863, NCC - If the fiduciary heir dies followed by the second heir, then the testator dies,
who will inherit? The legal heirs. There is no fideicommissary substitution because first and second heirs
are not living at the time of the testator’s death.

Situation 2: Art. 866, NCC - The testator dies first followed by the second heir (Fideicommissary). The
first heir survived them but subsequently dies, who will inherit? The second heir and his heirs under Art.
866, Civil Code. This is because the second heir passes his rights to his own heirs when he dies before first
heir.

Situation 3: If the first heir dies, followed by the testator, then the second heir, who will inherit? No
specific provision in law, but second heir inherits because the testator intended him to inherit.

11. Legitime

Art. 886, NCC - It is that part of the testator’s property which he cannot dispose of because the law has
reserved it for his compulsory heirs.

Art. 905, NCC - Every renunciation or compromise as regards a future legitime between the person owing
it and his compulsory heirs is void, and the latter may claim the same upon the death of the former; but
they must bring to collation whatever they may have received by virtue of the renunciation or
compromise.

a) Collation in Connection With the Computation of Legitime

 It is the process of adding the value of thing donated to the net value of hereditary estate. To collate is to
bring back or return to the hereditary mass, in fact or fiction, property which came from the estate of the
decedent, during his lifetime, but which the law considers as an advance from the inheritance. Collation is
applicable to both donations to compulsory heirs and donations to strangers.

General Rule: Compulsory heirs are obliged to collate.

Exception:
1. When testator should have so expressly provided;

2. When compulsory heir repudiates his inheritance

What are the properties that 1. Any property/right received by gratuitous title during testator’s lifetime
are to be collated?
2. All that may have been received from decedent during his lifetime

3. All that their parents have brought to collation if alive

What are the properties not 1. Absolutely no collation – expenses for support, education (elementary and
subject to collation? secondary only), medical attendance, even in extra-ordinary illness,
apprenticeship, ordinary equipment or customary gifts.

2. Generally not imputed to legitime:

     a. Expenses incurred by parents in giving their children professional,

vocational, or other career unless the parents so provide, or unless they impair
the legitime.

     b. Wedding gifts by parents and ascendants consisting of jewelry, clothing

and outfit except when they exceed 1/10 of the sum disposable by will.

Note: Only the value of the thing donated shall be brought to collation. This
value must be the value of the thing at the time of the donation.

b) Table of Legitime

Combination of compulsory Legitimes under NCC, as amended.

heirs

1) LC of testator One half (1/2) of the hereditary estate to be divided equally among the
legitimate children (Art. 888, CC), irrespective whether they survive alone
or with concurring compulsory heirs

2) LP, ILC, SS One half (1/2) of the estate goes to the legitimate parents to be divided equally
between (Arts. 889 & 890, CC)

3) LA of P and M Lines if One half (1/2) of the estate to be divided equally between them. It pertains
testator has no child or entirely to the ones nearest in degree of either line (Arts. 890, CC)
leaves neither father or
mother.
4) 1 LC and SS One half (1/2) of the estate (legitime) goes to the legitimate child (Art. 888,
CC); and

One fourth (1/4) of the estate (free portion) goes to the surviving spouse (Arts.
892, CC)

5) 2 LC and SS One half (1/2) of the estate (legitime) to be divided among the legitimate
children (Art. 888, CC); and

Surviving spouse gets a share (from the free portion) equal to the legitime of
each of the legitimate children (Arts. 892, CC)

6) LP and SS One half (1/2) of the estate (legitime) goes to the legitimate parents (Arts. 889
& 890, CC); and

One fourth (1/4) of the estate (free portion) goes to the surviving spouse (Arts.
893, CC)

7) ILC and SS One third (1/3) of the estate (legitime) goes to the illegitimate children; and
 One third (1/3) of the estate (legitime) goes to the surviving spouse (Art. 894,
CC); and

8) LC and ILC One half (1/2) of the hereditary estate (legitime) to be divided equally among
the legitimate children (Art. 888, CC); and

Each illegitimate child gets a share (from the free portion) equal to one half
(1/2) of the legitime of each of the legitimate children (Arts. 895, CC)

All the concurring heirs get their shares from the free portion. The surviving
spouse is preferred over the illegitimate children whose share in the inheritance
may suffer a proportionate (pro rata) reduction.

9) LP and ILC One half (1/2) of the estate (legitime) goes to the legitimate parents (Art. 889,
CC); and

One fourth (1/4) of the estate (free portion) goes to the illegitimate
children (Art. 896, CC)

10) LC, ILC, and SS One half (1/2) of the estate (legitime) to be divided among the legitimate
children (Art. 888, CC);

Each illegitimate child gets a share (from the free portion) equal to one half
(1/2) of the legitime of each of the legitimate children;

Surviving spouse gets a share (from the free portion) equal to the legitime of
each of the legitimate children (Arts. 892, CC) (Arts. 897 and 898, CC)

11) LP, ILC, and SS One half (1/2) of the estate (legitime) to be divided equally between the
legitimate parents (Arts. 889 & 890, CC);

One fourth (1/4) of the estate (free portion) goes to the illegitimate
children; and

One eighth (1/8) of the estate (free portion) goes to the surviving
spouse (Art. 899, CC)

12) SS One half (1/2) of the estate (legitime) goes to the surviving spouse;

But the share is reduced to one third (1/3) of the estate in the case of marriage
in articulo mortis and the testator died within three (3) months from its
solemnization (Art. 900, CC)

13) ILC One half (1/2) of the estate (legitime) goes to the illegitimate children (Art. 901,
CC)

14) ILP One half (1/2) of the estate (legitime) of the illegitimate child (Art. 903, CC)

15) ILP and SS of ILC One fourth (1/4) of the estate (legitime) goes to the illegitimate parents; and

One fourth (1/4) of the estate (legitime) goes to the surviving spouse (Art. 903,
CC)

c) Impairment of the Legitime - Remedy of a Compulsory Heir in Case of Impairment of Legitime:

Extent and nature of impairment Remedy

a) Total omission of a compulsory heir Art. 854, NCC - Annulment of institution and reduction of
who is a direct descendant or ascendant legacies and devises
(preterition)

b) Testamentary dispositions impairing or Art. 907, NCC - Reduction of the disposition insofar as they may
diminishing the legitime be inofficious or excessive.

c) Partial impairment Art. 903, NCC - Completion of the legitime.

d) Impairment by inofficious donations Art. 711 and 911, NCC - Collation – reduction of donations.

How are Devises and Legacies with usufructs, life annuities and pensions reduced? - If the value of these
grants exceeds the free portion, it impairs the legitimes and should be reduced.

The compulsory heir has 2 options:

 1. Delivering to the devisee or legatee the free portion

2. Complying with the testamentary provision

Note: If the devise subject to reduction should consist of real property, which cannot be conveniently
divided, it shall go to the devisee if the reduction does not absorb 1⁄2 of its value; and in a contrary case, to
the compulsory heirs; but the former and the latter shall reimburse each other in cash for what
respectively belongs to them.

Art. 912, NCC - The devisee who is entitled to a legitime may retain the entire property, provided its value
does not exceed that of the disposable portion and of the share pertaining to him as a legitime.

Art. 913, NCC - If the heirs or devisees do not choose to avail themselves of the right granted by the
foregoing, any heir or devisee who did not have such right may exercise it; should the latter not make use
of it, the property shall be sold at public auction at the instance of any one of the interested parties.

Note: Rule on Reduction of Legitimes (Shares)

Legitimate children Never reduced, they are primary and preferred

Surviving spouse Never reduced

Illegitimate children Subject to reduction, pro rata, without preference (you get the
remaining portion, divide it by the number of illegitimate children)

d) Presumptive Legitime

Re-appearance of Art. 102. Upon dissolution of the absolute community regime, the following procedure
former spouse shall apply:
(Articles 102 (5),
43(2) a) The presumptive legitimes of the common children shall be delivered upon
partition, in accordance with Article 51.
b) Art. 43. The termination of the subsequent marriage referred to in the preceding
Article shall produce the following effects:

The absolute community of property or the conjugal partnership, as the case may be,
shall be dissolved and liquidated.

XPN: If either spouse contracted said marriage in bad faith, his or her share of the
net profits of the community property or conjugal partnership property shall be
forfeited in favor of the common children or, if there are none, the children of the
guilty spouse by a previous marriage or in default of children, the innocent spouse;

Annulment (Articles Art. 50, . The final judgment in such cases shall provide for the liquidation, partition and
50 , 51) distribution of the properties of the spouses, the custody and support of the common
children, and the delivery of their presumptive legitimes, unless such matters had been
adjudicated in previous judicial proceedings.

Art. 51. In said partition, the value of the presumptive legitimes of all common children,
computed as of the date of the final judgment of the trial court, shall be delivered in
cash, property or sound securities, unless the parties, by mutual agreement judicially
approved, had already provided for such matters. The children or their guardian or the
trustee of their property may ask for the enforcement of the judgment.

The delivery of the presumptive legitimes herein prescribed shall in no way prejudice the
ultimate successional rights of the children accruing upon the death of either of both of
the parents; but the value of the properties already received under the decree of
annulment or absolute nullity shall be considered as advances on their legitime.

3. Legal Separation Art. 102. Upon dissolution of the absolute community regime, the following procedure
(Articles 102 (5), shall apply:
63(2))
a) The presumptive legitimes of the common children shall be delivered upon
partition, in accordance with Article 51.
b) Art. 63. The decree of legal separation shall have the following effects:

The absolute community or the conjugal partnership shall be dissolved and

liquidated but the offending spouse shall have no right to any share of the net
profits earned by the absolute community or the conjugal partnership, which
 shall be forfeited in accordance with the provisions of Article 43(2);

4. Other causes for Art. 102. Upon dissolution of the absolute community regime, the following procedure
the dissolution of shall apply:
conjugal property
(Articles 102, 129,
135) (1) An inventory shall be prepared, listing separately all the properties of the
absolute community and the exclusive properties of each spouse.

(2) The debts and obligations of the absolute community shall be paid out of its
assets. In case of insufficiency of said assets, the spouses shall be solidarily liable
for the unpaid balance with their separate properties in accordance with the
provisions of the second paragraph of Article 94.

(3) Whatever remains of the exclusive properties of the spouses shall thereafter
be delivered to each of them.

(4) The net remainder of the properties of the absolute community shall
constitute its net assets, which shall be divided equally between husband and
wife, unless a different proportion or division was agreed upon in the marriage
settlements, or unless there has been a voluntary waiver of such share provided
in this Code. For purpose of computing the net profits subject to forfeiture in
accordance with Articles 43, No. (2) and 63, No. (2), the said profits shall be the
increase in value between the market value of the community property at the
time of the celebration of the marriage and the market value at the time of its
dissolution.

(5) The presumptive legitimes of the common children shall be delivered upon
partition, in accordance with Article 51.

(6) Unless otherwise agreed upon by the parties, in the partition of the
properties, the conjugal dwelling and the lot on which it is situated shall be
adjudicated to the spouse with whom the majority of the common children
choose to remain. Children below the age of seven years are deemed to have
chosen the mother, unless the court has decided otherwise. In case there in no
such majority, the court shall decide, taking into consideration the best interests
of said children.

Art. 129. Upon the dissolution of the conjugal partnership regime, the following
procedure shall apply:

(1) An inventory shall be prepared, listing separately all the properties of the
conjugal partnership and the exclusive properties of each spouse.

(2) Amounts advanced by the conjugal partnership in payment of personal debts

and obligations of either spouse shall be credited to the conjugal partnership as
an asset thereof.

(3) Each spouse shall be reimbursed for the use of his or her exclusive funds in
the acquisition of property or for the value of his or her exclusive property, the
ownership of which has been vested by law in the conjugal partnership.

(4) The debts and obligations of the conjugal partnership shall be paid out of the
conjugal assets. In case of insufficiency of said assets, the spouses shall be
solidarily liable for the unpaid balance with their separate properties, in
accordance with the provisions of paragraph (2) of Article 121.

(5) Whatever remains of the exclusive properties of the spouses shall thereafter
be delivered to each of them.

(6) Unless the owner had been indemnified from whatever source, the loss or
deterioration of movables used for the benefit of the family, belonging to either
spouse, even due to fortuitous event, shall be paid to said spouse from the
conjugal funds, if any.

(7) The net remainder of the conjugal partnership properties shall constitute the
profits, which shall be divided equally between husband and wife, unless a
different proportion or division was agreed upon in the marriage settlements or
unless there has been a voluntary waiver or forfeiture of such share as provided
 in this Code.

(8) The presumptive legitimes of the common children shall be delivered upon
the partition in accordance with Article 51.

(9) In the partition of the properties, the conjugal dwelling and the lot on which
it is situated shall, unless otherwise agreed upon by the parties, be adjudicated
to the spouse with whom the majority of the common children choose to remain.
Children below the age of seven years are deemed to have chosen the mother,
unless the court has decided otherwise. In case there is no such majority, the
court shall decide, taking into consideration the best interests of said children.

Art. 135. Any of the following shall be considered sufficient cause for judicial separation
of property:

(1) That the spouse of the petitioner has been sentenced to a penalty which
carries with it civil interdiction;

(2) That the spouse of the petitioner has been judicially declared an absentee;

(3) That loss of parental authority of the spouse of petitioner has been decreed
by the court;

(4) 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;

(5) That the spouse granted the power of administration in the marriage
settlements has abused that power; and

(6) 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 Numbers (1), (2) and (3), 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.

5. Decree of Nullity Art. 50. The final judgment in such cases shall provide for the liquidation, partition and
(Article 50) distribution of the properties of the spouses, the custody and support of the common
children, and the delivery of third presumptive legitimes, unless such matters had been
adjudicated in previous judicial proceedings.

12. Preterition

a) Requisites

Art. 854, NCC:

1. There must be a total omission of one, some or all of the heir/s from the inheritance [Seangio v. Reyes,
G.R. Nos. 140371-72 (2006)].
2. The omission must be that of a compulsory heir.
3. The compulsory heir omitted must be of the direct line.
4. The omitted compulsory heir must be living at the time of the testator’s death or must at least have been
conceived before the testator’s death.

Omission of Heir from Inheritance:

Not named Although named

He is not named in the will. He is:

1. Expressly disinherited without valid cause
2. Not instituted as an heir 3. Not assigned any part of the estate
Thus: the heir is deprived of his right to legitime.

No Preterition

Reyes v. Barretto-Datu, 1967 - If the heir in question is instituted in the will but the portion given to him
by the will is less than his legitime – there is no preterition.

Aznar v. Duncan, 1966 - If the heir is given a legacy or devise – there is no preterition.
 If the heir had received a donation inter vivos from the testator – the better view is that there is no
preterition. The donation inter vivos is treated as an advance on the legitime under Articles 906, 909, 910
and 1062.

The remedy, if the value of inheritance, legacy or devise, or donation inter vivos is only for completion of
his legitime under Articles 906 and 907.

Distinguished from Disinheritance:

Preterition Disinheritance

 Tacit deprivation of a compulsory heir of his  Express deprivation of a compulsory heir of

legitime his legitime
 May be voluntary but the presumption of law  Always voluntary
is that it is involuntary  For some legal cause
  Law presumes there has been merely  If the disinheritance is valid, the compulsory
oversight or mistake on the part of the heir disinherited is totally excluded from the
testator inheritance
 Since preterition annuls the institution of  In case of invalid disinheritance, the
heirs, the omitted heir gets not only his compulsory heir is merely restored to his
legitime but also his share in the free portion legitime
not disposed of by way of legacies and devises

Effects of preterition – Art. 854, NCC

1. The institution of the heir is annulled.

2. Devises and legacies shall remain valid as long as they are not inofficious.
3. If the omitted compulsory heir should die before the testator, the institution shall be effective, without
prejudice to the right of representation.

Neri v. Akutin, 1941 - When there are no devises and legacies, preterition will result in the annulment of the
will and give rise to intestate succession.

b) Governing Law

13. Conditional Dispositions and Dispositions

3 Kinds of Testamentary Disposition:

a) Art. 871, NCC – Conditional.

b) Art. 885, NCC - Dispositions with a term.
c) Art. 882, NCC - Dispositions with a mode/modal dispositions.

1. Conditional Dispositions: POTESTATIVE, CASUAL, AND MIXED CONDITIONS

Potestative Conditions - Depends solely on the will of the heir.

GR: Must be fulfilled as soon as the heir learns of the testator’s death.

XPN: If the condition was already complied with at the time the heir learns of the testator’s death; or if the
condition is of such a nature that it cannot be fulfilled again. If there is constructive compliance , it is
deemed fulfilled.

Casual and Mixed Conditions:

Casual Mixed

Fulfillment depends on chance or the will of a Fulfillment depends partly on the will of the heir and partly
third person. on chance or the will of a third person.

GR: May be fulfilled at any time (before or after testator’s death), unless testator provides otherwise.

XPN: If already fulfilled at the time of execution of will:

1. If testator unaware of the fact of fulfillment – deemed fulfilled

2. If testator aware:

a) can no longer be fulfilled again: deemed fulfilled

b) can be fulfilled again: must be fulfilled again.
 Constructive Compliance:

1. If casual – not applicable

2. If mixed – applicable only if dependent partly on the will of a third party not interested.

Dispositions with a Term: A term may either be suspensive or resolutory

Suspensive Resolutory
Before the arrival of the term, the property should be Before the arrival of the term, the property should be
delivered to the legal or intestate heirs. Upon the delivered to the instituted heir.
arrival of the term, the inheritance should be delivered
to the heir.
A caución muciana, or bond, has to be posted by the No caución muciana required.
legal or intestate heirs.

a) Condition Not to Marry

Prohibited conditions: (considered as not imposed)

a) Art. 872-873, NCC - Any charge, condition or substitution whatsoever upon the legitimes.
b) Art. 873, NCC - Impossible and illegal conditions.
c) Art. 874, NCC - Absolute condition not to contract a first marriage.
d) Art. 874, NCC - Absolute condition not to contract a subsequent marriage unless imposed on the
widow or widower by the deceased spouse, or by the latter’s ascendants or descendants.
e) Art. 875, NCC - Scriptura captatoria or legacy-hunting dispositions - dispositions made upon the
condition that the heir shall make some provision in his will in favour of the testator or of any other
person.

b) Disposicion Captatoria

Art. 875, NCC - 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 shall be void.

It is a disposition made upon the condition that the heir shall make provisions in his will in favor of the
testator or of any person (Art. 875, NCC). It is void, because it makes the making of a will contractual or
with a consideration. Basically, a will is an act of pure liberality.

c) Modal Institution

Modal dispositions: Dispositions with an obligation imposed upon the heir, without suspending the
effectivity of the institution, as a condition does. A mode functions similarly to a resolutory condition.

In modal institutions, the testator states: Rabadilla v. CA, 2000.

o the object of the institution;

o the purpose or application of the property left by the testator; or
o the charge imposed by the testator upon the heir.

Caución Muciana - A security to guarantee the return of the value of property, fruits, and interests, in
case of contravention of condition, term or mode.

Instances when it is needed:

1. Suspensive term [Art. 885, Civil Code]

2. Negative potestative condition - when the condition imposed upon the heir is negative, or consists in
not doing or not giving something [Art. 879, Civil Code] 3. Mode [Art. 882, par. 2, Civil Code]

14. Void Testamentary Dispositions

Every disposition in favor of an unknown person shall be void, unless by some event or circumstances his
identity becomes certain. However, a disposition in favor of a definite class or group of person shall be
valid.

15. Disinheritance

Art. 915, NCC - A compulsory heir may, in consequence of disinheritance, be deprived of his legitime, for
causes expressly stated by law.
Effect of Disinheritance:

A disinherited heir is totally excluded from the inheritance. This means that he forfeits not only his
legitime, but also his intestate portion (if any), and any testamentary disposition made in a prior will of
the disinheriting testator.

Requisites of a Valid Disinheritance:

1. Heir disinherited must be designated by name or in such a manner as to leave no room for doubt as to
who is intended to be disinherited;
2. It must be for a cause designated by law;
3. It must be made in a valid will;
4. It must be made expressly, stating the cause in the will itself;
5. The cause must be certain and true and must be proved by the interested heir if the person should deny it;
6. It must be unconditional; and
7. It must be total.

Note: The burden of proving the truth of the cause for disinheritance shall rest upon the other heirs of the
testator, if the disinherited heir should deny it [Art. 917, Civil Code].

Causes Common to Disinheritance and Unworthiness

Article 1032 enumerates five acts of unworthiness which likewise constitute grounds to disinherit a compulsory
heir.

The effect of the concurring causes of unworthiness and grounds for disinheritance is as follows: If the testator
failed to disinherit the offender, the law nonetheless intervenes by excluding the offender from the inheritance of
the testator or the decedent by reason of unworthiness.

Disinheritance Unworthiness

Expressly made by testator made by operation of law

A subsequent reconciliation is enough Either:

1. written pardon, or
2. subsequent will reconciliation (not enough if
he did not know the cause)
Overlap of Rules: Remedy
Unworthiness stays
1. If the offended party does not make a will subsequent to
the occurrence of the cause

o Unworthiness sets in
o Written condonation is necessary to restore

2. If the offended party makes a will subsequent to the

occurrence of the cause

o If he knew the cause

o If he disinherits - Art. 922
o If he institutes or pardons the offender - Restored
to capacity
o If will silent – unworthiness stays

a) Grounds for Disinheritance

Art. 919, NCC –
disinheritance of
legitimate and illegitimate
children and descendants:
(1) When a child or descendant has been found guilty of an attempt against the life
of the testator, his or her spouse, descendants, or ascendants;
(2) When a child or descendant has accused the testator of a crime for which the
law prescribes imprisonment for six years or more, if the accusation has been
found groundless;

(3) When a child or descendant has been convicted of adultery or concubinage

with the spouse of the testator;

(4) When a child or descendant by fraud, violence, intimidation, or undue

influence causes the testator to make a will or to change one already made;

(5) A refusal without justifiable cause to support the parent or ascendant who
 disinherits such child or descendant;

(6) Maltreatment of the testator by word or deed, by the child or descendant;

(7) When a child or descendant leads a dishonorable or disgraceful life;

(8) Conviction of a crime which carries with it the penalty of civil interdiction.

Art. 920, NCC - Anent
legitimate or illegitimate
parents and ascendants,
the following are
considered as grounds for
disinheriting them.
(1) When the parents have abandoned their children or induced their daughters to
live a corrupt or immoral life, or attempted against their virtue;
(2) When the parent or ascendant has been convicted of an attempt against the life
of the testator, his or her spouse, descendants, or ascendants;
(3) When the parent or ascendant has accused the testator of a crime for which the
law prescribes imprisonment for six years or more, if the accusation has been
found to be false;

(4) When the parent or ascendant has been convicted of adultery or concubinage
with the spouse of the testator;

(5) When the parent or ascendant by fraud, violence, intimidation, or undue

influence causes the testator to make a will or to change one already made;

(6) The loss of parental authority for causes specified in this Code;

(7) The refusal to support the children or descendants without justifiable cause;

(8) An attempt by one of the parents against the life of the other, unless there has
been a reconciliation between them.

Art. 921, NCC - Finally,
the surviving spouse may
be disinherited for the
following causes.
(1) When the spouse has been convicted of an attempt against the life of the
testator, his or her descendants, or ascendants;
(2) When the spouse has accused the testator of a crime for which the law
prescribes imprisonment of six years or more, and the accusation has been found
to be false;

(3) When the spouse by fraud, violence, intimidation, or undue influence cause
the testator to make a will or to change one already made;

(4) When the spouse has given cause for legal separation;

(5) When the spouse has given grounds for the loss of parental authority;

(6) Unjustifiable refusal to support the children or the other spouse.

b) Requisites for the Various Grounds for Disinheritance

c) Effects of Reconciliation

Modes of Revocation of Disinheritance:

1. Reconciliation [Art. 922, Civil Code]

2. Subsequent institution of the disinherited heir
3. Nullity of the will which contains the disinheritance.

Note: The moment that testator uses one of the acts of unworthiness as a cause for disinheritance; he thereby
submits it to the rules on disinheritance. Thus, reconciliation renders the disinheritance ineffective.

Art. 922, NCC – Reconciliation: Effect of Reconciliation between Offender and Offended Person:

  If no disinheritance has been made yet, the offended person will be deprived of his right to disinherit.
 If disinheritance has been effected, it will be rendered ineffectual.

Rights of Descendants of Persons Disinherited [Art. 923, Civil Code]: Disinheritance gives rise to the right
of representation in favor of the children and descendants of the disinherited person with respect to his
legitime.

Art. 918, NCC - Ineffective Disinheritance : Instances of Ineffective disinheritance:

a) There is no specification of the cause.

b) The cause is not proved.
c) The cause is not among those specified in the provisions.
Effect of Ineffective Disinheritance: if the disinheritance lacks one or other of the requisites mentioned in
this article, the heir in question gets his legitime.

Inneffective disinheritance Preterition

Person disinherited may be any compulsory heir . Person omitted must be a compulsory heir in the
Only annuls the institution in so far as it prejudices direct line . it Annuls the entire institution of heirs
the person disinherited

16. Legacies and Devises

Legacy Devisee

A gift of personal property given in a will A gift of real property given in a will

It is bequeathed It is devised

Persons charged with the Duty to Give Legacies and Devises in a Will

1. Compulsory heir, provided, their legitimes are not impaired [Art. 925, Civil Code]
2. Voluntary heir
3. Legatee or devisee can be charged with the duty of giving a sub-legacy or sub- devise but only to the extent
of the value of the legacy or devise given him [Art. 925, Civil Code]
4. The estate represented by the executor or administrator, if no one is charged with this duty to pay or
deliver the legacy or devise in the will

If there is an administration proceeding, it constitutes a charge upon the estate. If there is no

administration proceeding, it is a charge upon the heirs.

Art. 951, NCC: Delivery of Legacy/Devise - The very thing bequeathed shall be delivered and not its value

1. With all its accessions and accessories

2. In the condition in which it may be upon the death of the testator
3. Legacies of money must be paid in cash

a) Requisites for Validity

b) Property Not Owned by the Testator

Art. 929, NCC - L/D of The legacy or devise shall be understood to be limited to such part or interest
a thing owned in part
by the testator XPN: If testator expressly declares that he gives the thing in its entirety.

Art. 930, NCC - L/D of Testator erroneously believed that the Void
a thing belonging to property belonged to him
another.
The thing bequeathed afterwards becomes Effective
his by whatever title

Testator knew property did not belong to Valid – estate must try to acquire
him property or else give the heir its
monetary value.

L/D of a thing Art. 932, NCC - The thing already belongs Ineffective
belonging to the to the legatee or devisee at the time of the
legatee/devisee execution of the will.

Art. 932, NCC - The thing is subject to an Valid only as to the interest or
encumbrance or interest of another person. encumbrance
Art. 933, NCC - Legatee or devisee Ineffective
subsequently alienates the thing.

Art. 933, NCC - After alienating the thing, Ineffective

the legatee or devisee subsequently
reacquires it gratuitously.

Art. 933, NCC - After alienating the thing, Legatee or devisee can demand
the legatee or devisee acquires it by reimbursement from the heir or estate
onerous title.
c) Ineffective Legacies/Devises

Art. 956, NCC - Effect of Ineffective Legacies or Devises:

In case of repudiation, revocation or incapacity of the legatee or devisee, the legacy or devise shall
be merged with the mass of the hereditary estate, except in cases of substitution or accretion.

Art. 957, NCC - Revocation of Legacies and Devises.

1. Testator transforms the thing such that it does not retain its original form or denomination.
2. Testator alienates the thing by any title or for any cause. Reacquisition of the thing by the testator
does not make the legacy or devise valid, unless it is effected by right of repurchase.
3. Thing is totally lost during the lifetime or after the death of the testator.
4. Other causes: nullity of will, non- compliance with suspensive condition, sale of the thing to pay
the debts of the deceased during the settlement of his estate.

C. Intestate Succession

Intestacy – that which takes place by operation of law in default of compulsory and testamentary
succession. Not defined in the Civil Code.

Legal succession is a mode of transmission mortis causa which takes place in the absence of the expressed
will of the decedent embodied in a testament.

1. Relationship

Proximity of Relationship: determined by the number of generations. Each generation forms one degree –
Art. 963, NCC.

Note: It is important to distinguish between direct and collateral, as the direct has preference over the
collateral. In a line, as many degrees are counted as there are generations – Art. 966, NCC.

Note: Descending line is preferred over ascending. Blood relationship is either full or half-blood – Art.
967, NCC.

Note: As among brothers and sisters and nephews and nieces, there is a 2:1 ratio for full- blood and half-
blood relatives. Direct relatives are preferred. But this distinction does not apply with respect to other
collateral relatives.

Incapacity – Art. 968, NCC:

General Rule: If there are several relatives of the same degree, and one or some of them are unwilling or
incapacitated to succeed, his portion shall accrue to the others of the same degree.

Exception: When the right of representation should take place.

Note: This accretion in intestacy takes place in case of predecease, incapacity, or renunciation among
heirs of the same degree. The relatives must be in the same relationship because of the Rule of Preference
of Lines.

Repudiation - Arts. 968-969, NCC:

There is no right of representation in repudiation. If the nearest relative/s repudiates the inheritance,
those of the following degree shall inherit in their own right.

In case of repudiation by all in the same degree, the right of succession passes on the heirs in succeeding
degrees: descending line first, ascending line next, and collateral line next.

2. Causes of Intestacy - Art. 960, NCC - Instances When Legal or Intestate Succession Operates.

1. If a person dies without a will, or with a void will, or will has subsequently lost its validity;
2. When the will does not institute an heir;
3. Upon the expiration of term, or period of institution of heir.
4. Upon fulfillment of a resolutory condition attached to the institution of heir, rendering the will
ineffective.
5. When the will does not dispose of all the property belonging to the testator. Legal succession shall
take place only with respect to the property which the testator has not disposed (mixed succession);
6. If the suspensive condition attached to the institution of the heir does not happen or is not fulfilled;
7. If the heir dies before the testator;
 8. If the heir repudiates the inheritance, there being no substitution, and no right of accretion takes
place;
9. When the heir instituted is incapable of succeeding, except in cases provided in the Civil Code;
10. Preterition – Intestacy may be total or partial depending on whether or not there are legacies or
devises.

Note: In all cases where there has been an institution of heirs, follow the ISRAI order:

1. If the Institution fails, Substitution occurs.

2. If there is no substitute, the right of Representation applies in the direct descending line to the
legitime if the vacancy is caused by predecease, incapacity, or disinheritance.
3. The right of Accretion applies to the free portion when the requisites in Art. 1016 are present.
4. If there is no substitute, and the right of representation or accretion is not proper, the rules on
Intestate succession shall apply.

Representation: Only when vacancy is caused by:

1. Predecease
2. Incapacity
3. Disinheritance

3. Order of Intestate Succession

Note: In partial intestacy, the testamentary dispositions can reduce the shares of intestate heirs, provided that
their legitimes, if they are also compulsory heirs, are not impaired. More specifically:

1. The law of legitimes must be brought into operation in partial intestacy.

2. If among the concurring intestate heirs there are compulsory heirs whose legal or intestate portions
exceed their respective legitimes, the amount of the testamentary disposition must be deducted from the
disposable portion, to be borne by all the intestate heirs in the proportions that they are entitled to receive
from such disposable portion as intestate heir.

3. If the legal or intestate share of a compulsory heir is equal to his legitime, then the amount of the
testamentary disposition must be deducted only from the legal or intestate shares of the others.

4. If the testamentary dispositions consume the entire disposable portion, then the intestate heirs who are
compulsory heirs will get only their legitimes, and those who are not compulsory heirs will get nothing

LC only o Divide entire estate equally among all legitimate children [Art. 979, Civil Code]
o Legitimate children include an adopted child.

LC and ILC o Divide entire estate such that each illegitimate child gets 1⁄2 of what a legitimate child
gets [Art. 983, Civil Code and Art. 176, Family Code]
o Ensure that the legitime of the legitimate children are first satisfied.

LC and SS Divide entire estate equally between the legitimate children and the surviving spouse, the
latter deemed as one child. The same rule holds where there is only one child.

LC, SS, and o Divide the entire estate such that the surviving spouse is deemed one legitimate child
ILC and each illegitimate child getting 1⁄2 of what the legitimate child gets [Art. 996, Civil
Code and Art. 176, Family Code]
o Ensure that the legitime of the legitimate children and the spouse are first satisfied.

LP Only Divide the entire estate equally [Art. 985, Civil Code].

LA only Divide the entire estate equally but with the observance of the rule of division by line [Art. 987,
(excluding Civil Code].
parents)

LP and ILC Legitimate parents get 1⁄2 of the estate, illegitimate children get the other 1⁄2 [Art. 991, Civil
Code].

LP and SS Legitimate parents get 1⁄2 of the estate; The surviving spouse gets the other 1⁄2 [Art. 997, Civil
Code].

LP, SS, ILC Legitimate parents get 1⁄2 of the estate; surviving spouse and the illegitimate child each get 1⁄4
each, the latter to share among themselves if more than one [Art. 1000, Civil Code].

ILC Only Divide the entire estate equally [Art. 988, Civil Code].

ILC and SS Illegitimate children get 1⁄2 of the estate; the surviving spouse gets the other 1⁄2 [Art. 998, Civil
Code].
 SS Only Entire estate goes to the surviving spouse [Art. 995, Civil Code].

SS and ILP Illegitimate parents get 1⁄2 and the spouse gets the other 1⁄2 [by analogy with Art. 997, Civil
Code].

SS and Surviving spouse gets 1⁄2 of the estate, while the rest gets the other 1⁄2 with the nephews and
Legitimate nieces inheriting by representation if proper [Art. 1001, Civil Code].
B/S, N and N

SS and Surviving spouse gets 1⁄2 of the estate while the rest gets the other 1⁄2 with the nephews and
Illegitimate nieces inheriting by representation, if proper; Note that all the other relatives should be
B/S, N and N “illegitimate” because of the iron-curtain rule [Art. 994, Civil Code].

ILP Only Entire estate goes to the illegitimate parents [Art. 993, Civil Code].

ILP and Illegitimate parents are excluded and do not inherit.

Children of
any kind
(whether L
or IL)

L B/S only Divide the entire estate such that full-blood brothers/sisters get a share double the amount of a
half-blood brother or sister [Art. 1004 and 1006, Civil Code].
L B/S, N and Divide the entire estate observing the 2 is to 1 ratio for full and half- blood relationships with
N respect to the brothers and sisters, with the nephews and nieces inheriting by representation, if
proper [Art. 1005 & 1008, Civil Code].

N/N only Divide the entire estate per capita, observing the 2 is to 1 ratio [Art. 975 and 1008, Civil Code].

Other Divide entire estate per capita. Collateral relatives must be with the 5th degree of consanguinity.
collaterals
Note: the nearer relative excludes the more remote relatives.
State If there are no other intestate heirs, the State inherits the entire estate through escheat
proceedings [Art. 1011, Civil Code].

4. Rule of Proximity and Rule of Equality

Fundamental Principles in Intestate Succession - Rule of Preference Between Lines:

o Those in the direct descending line shall exclude those in the direct ascending and collateral lines;
o Those in the direct ascending line shall, in turn, exclude those in the collateral line.

Rule of Proximity: The relative nearest in degree excludes the farther one [Art. 962(1), Civil Code], saving the
right of representation when it properly takes place.

Rule of Equal Division: General Rule: The relatives who are in the same degree shall inherit in equal shares
[Arts. 962(2), 987 and 1006, Civil Code].

Exceptions:

1. Rule of preference between lines;

2. Distinction between legitimate and illegitimate filiation. The ratio under the present law is 2:1 [Art.
983, in relation to Art. 895, Civil Code as amended by Art. 176, Family Code];
3. Rule of division by line in the ascending line [Art. 987 (2), Civil Code];
4. Distinction between full-blood and half- blood relationship among brothers and sisters, as well as
nephews and nieces [Art. 1006 and 1008, Civil Code];
5. Right of representation.

a) Exceptions to the Rule of Proximity and Rule of Equality

5. Determination of Heirs

Decedent is a legitimate Decedent is an illegitimate Decedent is an adopted child

child child

Legitimate children or Legitimate children or Legitimate children or descendants

descendants (LCD) descendants (LCD) (LCD)
 Legitimate parents or
ascendants (LPA)
Illegitimate children or
descendants (ICD)
Surviving spouse (SS)
Illegitimate children or
descendants (LPA)
Illegitimate parents (IP)
Surviving spouse (SS)
Illegitimate children or descendants
(ICD)
Legitimate or illegitimate parents, or
legitimate ascendants, adoptive
parents
Surviving spouse (SS)

Brothers and sisters, nephews, Brothers and sisters, nephews, Brothers and sisters, nephews, nieces
nieces (BS/NN) nieces (BS/NN) (BS/NN)

Legitimate collateral relatives State State

within the 5th degree (C5)
State

Intestate heirs Excludes Excluded by Concurs with

LC + LD Ascendants, Collaterals and State No one SS + ILC

ILC + D ILP, Collaterals and State No one SS, LC, LP

LP + LA Collaterals and State LC ILC + SS

ILP Collaterals and State LC and IC SS

SS Collaterals other than siblings, No one LC, ILC, LP, ILP,

nephews and nieces, State Siblings, Nephews,
Nieces
Siblings, nephews, All other collaterals and State LC, ILC, LP, ILP SS
nieces

Other collaterals Collateral more remote in degree LC, ILC, LP, ILP and Collaterals in the
within 5th degree and State SS same degree

State No one Everyone No one

6. Successional Barrier (the “Iron Curtain Rule”) (See Aquino v. Aquino, G.R. Nos. 208912 and
209018, December 7, 2021)

Rule of Barrier between the legitimate family and the illegitimate family (the iron- curtain
rule): The illegitimate family cannot inherit by intestate succession from the legitimate family and vice-
versa [Art. 992, Civil Code].

Note: In Aquino v. Aquino [G.R. No. 208912 (2021)], the Supreme Court ruled that children, regardless of
their parents’ marital status, can now inherit from their grandparents and other direct ascendants by right
of representation. This decision, however, was promulgated beyond the cut off period of June 30, 2021.

Rule of Double Share for full blood collaterals: When full and half-blood brothers or sisters,
nephews or nieces, survive, the full blood shall take a portion in the inheritance double that of the half-
blood [Arts. 895 and 983, Civil Code].

Note:

1. If one of the legitimate ascendants, illegitimate parents, legitimate children or illegitimate

children survives, the brother, sisters, nephews, and nieces (BSNN) are excluded.
2. If one of the legitimate ascendants, illegitimate parents, legitimate children, illegitimate children
or surviving spouse survives, the other collateral relatives and the state are excluded.
3. If any of the heirs concur in legitimes, then they also concur in intestacy.

7. Successional Rights of Adopted Children

Adoption – Art. 189, FC:

In adoption, the legal filiation is personal and exists only between the adopter and the adopted. The
adopted is deemed a legitimate child of the adopter, but still remains as an intestate heir of his natural
parents and other blood relatives.

Note: Section 16 of the Domestic Adoption Act (RA 8552) provides that all legal ties between the
biological parent(s) and the adoptee shall be severed and the same shall then be vested on the adopter(s).”
8. Successional Rights of Adopting Parents - (Refer to the table above)

9. Successional Rights of Marital and Non-Marital Children - (Refer to the table above)

10. Successional Rights of the Surviving Spouse - (Refer to the table above)

11. Successional Rights of Collateral Relatives - (Refer to the table above)

D. Provisions Common to Testate and Intestate Succession

Cause of vacancy Testamentary succession Intestate succession

Legitime Free portion

Predecease Representation Accretion Representation

Intestate Succession Intestate Succession Intestate Succession
Incapacity Representation Accretion Representation

Intestate Succession Intestate Succession Intestate Succession

Disinheritance Representation - -

Intestate Succession
Repudiation Intestate Succession Accretion Accretion

1. Capacity to Succeed - Requisites for Capacity to Succeed by Will or by Intestacy [Art. 1024 –
1025, Civil Code]:

1. The heir, legatee or devisee must be living or in existence at the moment the succession opens [Art. 1025,
Civil Code]; and
2. He must not be incapacitated or disqualified by law to succeed [Art. 1024, par.1, Civil Code].

a) Incapacity by Reason of Unworthiness and Effects of Condonation

Based on Acts of Unworthiness [Art. 1032, Civil Code]: The following are incapable of succeeding
by reason of unworthiness:

1. Parents who have abandoned their children or induced their daughters to lead a corrupt or immoral
life, or attempted against their virtue;

2. Any person who has been convicted of an attempt against the life of the testator, his or her spouse,
descendants, or ascendants;
3. Any person who has accused the testator of a crime for which the law prescribes imprisonment for six
years or more, if the accusation has been found groundless;

4. Any heir of full age who, having knowledge of the violent death of the testator, should fail to report it
to an officer of the law within a month, unless the authorities have already taken action; this
prohibition shall not apply to cases wherein, according to law, there is no obligation to make an
accusation;

5. Any person convicted of adultery or concubinage with the spouse of the testator;

6. Any person who by fraud, violence, intimidation, or undue influence should cause the testator to
make a will or to change one already made;

7. Any person who by the same means prevents another from making a will, or from revoking one
already made, or who supplants, conceals, or alters the latter's will;

8. Any person who falsifies or forges a supposed will of the decedent.

Express Implied

Made by the execution of a document or any
writing in which the decedent condones the cause
of incapacity.
Cannot be revoked.
Effected when the testator makes a will instituting the
unworthy heir with knowledge of the cause of incapacity.
Revoked when the testator revokes the will or the
institution.

Effect of Pardon: Once the act of unworthiness has been pardoned, whether expressly or tacitly, the heir is
restored to full capacity to succeed the decedent, as if the cause of unworthiness had never existed.

Unworthiness Disinheritance

Unworthiness renders a person incapable of Disinheritance is the act by which a testator, for just cause,
succeeding to the succession, whether testate or deprives a compulsory heir of his right to the legitime [Art.
 intestate. 915, Civil Code].

Determination of Capacity - General Rule: At the death of the decedent - Art. 1034, NCC.

Exceptions:

1. Those falling under 2, 3, and 5 of Art. 1032 – when the final judgment is rendered;
2. Those falling under 4 of Art. 1032 – when the month allowed for the report expired;
3. If the institution is conditional – when the condition is complied with.

b) Incapacity by Reason of Morality - Arts. 739 and 1028, NCC:

Those made in favor of a person with whom the testator was guilty of adultery or concubinage at the time
of the making of the will;
Those made in consideration of a crime of which both the testator and the beneficiary have been found
guilty;
Those made in favor of a public officer or his spouse, descendants and ascendants, by reason of his public
office.

c) Incapacity by Reason of Possible Undue Influence - Persons Incapable of Succeeding [Arts. 1027, 739,
1032, Civil Code]: Based on undue influence or interest – Art. 1027, NCC:

1. Priest who heard the last confession of the testator during his last illness, or the minister of the gospel
who extended spiritual aid to him during the same period;
2. Individuals, associations and corporations not permitted by law to inherit;
3. Guardian with respect to testamentary dispositions given by a ward in his favor
before the final accounts of the guardianship have been approved, even if the testator should die after
the approval
4. thereof; except if the guardian is his ascendant, descendant, brother, sister, or spouse;
Relatives of the priest or minister of the gospel within the fourth degree, the church, order, chapter,
community, organization, or institution to which such priest or minister may belong;
5. Attesting witness to the execution of a will, the spouse, parents, or children, or anyone claiming under
such witness, spouse, parents, or children;
6. Physician, surgeon, nurse, health officer or druggist who took care of the testator during his last
illness.

2. Right of Representation in Testacy and Intestacy

Right of Representation: Art. 970, NCC - Representation – 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.

Effect of Representation - The representative heir acquires the rights which the person represented would
have if he were living or if he could have inherited.

When it occurs - Representation is allowed with respect to inheritance conferred by law (legitime and
intestate based on Art. 923).

It occurs only in the following instances: (DIP)

4. Predecease of an heir;
5. Incapacity or unworthiness;
6. Disinheritance [Art. 923, Civil Code].

Note: There is no right of representation in a devise or a legacy.

An heir who renounces can represent, but cannot be represented. Rationale is found in Art. 971 which
states that “The representative does not succeed the person represented but the one whom the person
represented would have succeeded.”

Art. 972, NCC - Representation in the Direct Descending Line: Representation takes place ad infinitum in the
direct descending line but never in the direct ascending line.

General Rule: Grandchildren inherit from the grandparents by right of representation, if proper.

Exception: Whenever all the children repudiate, the grandchildren inherit in their own right because
representation is not proper – Art. 969, NCC.

Art. 972, NCC - Representation in Collateral Line: In the collateral line, representation takes place only in favor of
the children of the brothers or sisters (i.e., nephews and nieces) whether of the full or half-blood and only if they
concur with at least one.
a) Requisites and Limitations

3. Right of Accretion in Testamentary Succession and in Intestacy

Art. 1015, NCC - Definition of Accretion:It is a right by virtue of which, when two or more persons are called
to the same inheritance, devise or legacy, the part assigned to one who renounces or cannot receive his share or
who died before the testator is added or incorporated to that of his co-heirs, co- devisees, or co-legatees.

Basis: The right of accretion is based upon the presumed will of the decedent. Thus, the testator can expressly
provide that there shall be no accretion among persons who would otherwise be entitled thereto. Conversely, the
testator may validly provide for accretion in a case where no accretion would take place under the provisions of
the law

Requisites

1. Unity of object and plurality of subjects (two or more persons are called to the same inheritance or same portion
thereof); and

2. Vacancy of share (one of the heirs dies before the testator, or renounces the inheritance, or is incapacitated)

When does Accretion Occur? - Accretion happens when there is repudiation, incapacity, or predecease
of an heir. It is the mechanism where the share of an heir is increased by vacant shares vacated by heirs who
cannot inherit for various reasons.

Rationale: The decedent intended to give the property to nobody but the co-heirs.

Art. 1016, NCC - There can only be accretion if there is an institution of heirs with respect to specific properties. In
other words, both heirs were called to inherit the same whole. If there was “earmarking” – there can be no
accretion.

● What is “earmarking?” – when the whole has been subdivided into specific portions

Arts. 1021 and 1018, NCC - Among compulsory heirs, there can only be accretion with respect to the free portion.
There can be no accretion with respect to the legitimes.

Art. 1019, NCC - The heirs to whom the portion goes by the right of accretion take it in the same proportion that
they inherit.

Exceptions:

1. In testamentary succession, if the testator provides otherwise;

2. If the obligation is purely personal, and hence intransmissible.

Art. 1020, NCC - The heirs to whom the inheritance accrues shall succeed to all the rights and obligations which
the heir who renounced or could not receive it would have had.

Art. 1022, NCC - In testamentary succession, when the right of accretion does not take place, the vacant portion of
the instituted heirs, if no substitute has been designated, shall pass to the legal heirs of the testator, who shall
receive it with the same charges and obligations.

Art. 1023, NCC - Accretion shall also take place among devisees, legatees and usufructuaries under the same
conditions established for heirs.

a) Requisites and Limitations

4. Acceptance and Repudiation of Inheritance

Definition of Acceptance - The act by which the person called to succeed by universal title either by
the testator or by law manifests his will of making his own the universality of the rights and obligations
which are transmitted to him.

Definition of Repudiation - The manifestation by an heir of his desire not to succeed to the rights and
obligations transmitted to him.

Art. 1043, NCC – Requisites:

1. Certainty of death of the decedent; and

2. Certainty of the right to the inheritance.
Art. 1049-1050, NCC- Forms of Acceptance:

1. Express Acceptance – one made in a public or private document [Art. 1049, par. Civil Code].

2. Tacit Acceptance – one resulting from acts by which the intention to accept is necessarily implied or from
acts which one would have no right to do except in the capacity of an heir.

3. Implied Acceptance - Within thirty days after the court has issued an order for the distribution of the estate
in accordance with the Rules of Court, the heirs, devisees and legatees 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, Civil Code].

An inheritance is deemed accepted:

1. If the heir sells, donates, or assigns his right to a stranger, or to his co-heirs, or to any of them – the heir
must first accept the inheritance before he can dispose of it.

2. If the heir renounces the same, even though gratuitously, for the benefit of one or more of his co-heirs –
this is actually a donation. The heir must first accept the inheritance before he can donate it.

3. If the heir renounces it for a price in favor of all his co-heirs indiscriminately – this is actually an onerous
disposition. The heir must first accept the inheritance before he can dispose of it.

Note: Art. 1050, NCC - But if the renunciation should be gratuitous, and in favor of all the co-heirs (to whom
the portion renounced should devolve by accretion), the inheritance shall not be deemed as accepted. This is a
true case of renunciation.

a) Form of Repudiation

Art. 1051, NCC - Forms of Repudiation:

1. In a public instrument acknowledged before a notary public; or

2. In an authentic document – equivalent of an indubitable writing or a writing whose authenticity is
admitted or proved; or
3. By petition presented to the court having jurisdiction over the testamentary or intestate proceeding

Art. 1055, NCC - Heirs in Two Capacities:

a) If a person is called to the same inheritance as an heir by will and by law and he repudiates the
inheritance in his capacity as a testamentary heir, he will be considered to have also repudiated
the inheritance as a legal heir

b) If he repudiates it as a legal heir, without knowledge of his being a testamentary heir, he may still
accept it in the latter capacity.

Irrevocability of Repudiation

GR: The acceptance or repudiation of an inheritance, once made, is irrevocable and cannot be impugned.

Exceptions

1. When the acceptance or repudiation suffers from any of the vices which annul consent; and
2. When an unknown will appears [Art. 1056, Civil Code].

b) Effects of Repudiation Compared to Predecease and Incapacity

Cause of vacancy Testamentary succession Intestate succession

Legitime Free portion

Predecease Representation Accretion Representation

Intestate Succession Intestate Succession Intestate Succession
Incapacity Representation Accretion Representation

Intestate Succession Intestate Succession Intestate Succession

Disinheritance Representation - -

Intestate Succession
Repudiation Intestate Succession Accretion Accretion
 OBLIGATIONS AND CONTRACTS

I. Obligations

A. General Provisions

1. Definition – an obligation is a juridical necessity to give, to do or not to do. (Art. 1156, NCC)

2. Essential Elements:

1. Juridical tie – The legal or judicial relationship; the unifying bond

2. Active subject –The obligee or creditor. The party who has the right to demand the performance of
obligation.
3. Passive subject – The obligor or debtor. The party who has the obligation to perform the obligation.
4. Prestation – The object or subject matter of the contract. The obligation to be performed.
5. Note: the obligation must contemplate an active subject (creditor) and the obligation must be capable of
pecuniary appreciation.

3. Sources of Obligation:

a. Law

 Taxes
 Marital obligation
 Parental obligation
 Damages

b. Contracts

 Sales
 Partnership
 Loan
 Mortgage
 Lease

c. Quasi-contracts

 Solutio indebiti
 Negotiorium Giesto

d. Delicts

 Reckless imprudence resulting in damage to property

e. Quasi-delicts

 Negligent torts

B. Nature and Effects of Obligations

Right vs. Obligation

 In every obligation there is a right in favor of another.

 This right can be demanded and enforced by law.
 The right must be rooted in any of the sources of obligation.

Types of obligations according to prestation: Personal v. Real obligations

 Personal obligations – obligation to do. (Perfected by mere consent) - EG: Contract of sale, lease, agency,
partnership.

 Real obligations – obligation to give (involves delivery of the thing) - EG: Contract of loan, deposit.

GR: Rights and obligations are transmissible. / XPN: those that are personal to the party.

Eg. of intransmissible rights and obligations:

 Rights and obligations of a partner in a partnership.
 Rights and obligations of the bailee in a contract of commodatum.
 Rights and contracts of parties in contrace of agency
Performance of obligations:

 According to the terms of the contract or law

 In good faith – performing the obligation with good intention or without the intention to cause prejudice
or harm to the other party.

a. Pacta sunt servanda (Art. 1315, NCC)

b. Rebus sic Stantibus (Art. 1266-1267, NCC)
c. Art. 19, NCC – to act with justice, give everyone his due and observe honesty and good faith.
d. Art. 1159, NCC – Obligations arising from contracts must be complied with in good faith.
e. Art. 1167, NCC – To execute what he failed to do and to undo what has been poorly done.

Examples of OBLIGATION:

1) Obligation to exercise due care: To perform every obligation with diligence – obligation to
take care of the thing.

a. Every person obliged to give something is also obliged to take care of it with the proper diligence of a
good father of a family, unless the law or stipulation of the parties requires another standard of care –
Art. 1163, NCC.

b. If the law or contract does not state the diligence which is to be observed in the performance, that
which is expected of a good father of a family shall be required – Art 1173, NCC.

c. Diligence depends on the nature of the obligation and must correspond to circumstances of the
persons, of the time and of the place.

d. A good father of a family means a person of ordinary or average diligence – Phil. Steal Coating Corp.
v. Quinones, 2017.

Art. 1173 - Negligence is the omission of the diligence required by the nature of the obligation and
corresponds with the circumstances of the person, of the time and of the place.

◦ It entitles the creditor or oblige a right to damages if the obligation is performed negligently –
Art. 1170, NCC.

◦ Also, it can be a separate cause of action in torts and quasi-delicts – Art. 2176, NCC.

Difference between negligence in quasi-delict and negligence in breach of contract:

Negligence in quasi-delict Negligence in breach of contract:

1. In quasi delict, negligence is direct, 1. In breach of contract, negligence is merely

substantive and independent.
2. GR: In quasi-delict, there is no
presumption of negligence, and it is
incumbent upon the injured party to
prove the negligence of the defendant,
otherwise, the former’s complaint will be
dismissed.
XPN: cases where there is presumption
of negligence.
incidental to the performance of the
contractual obligation, there is a
preexisting contract or obligation.
2. In breach of contract, negligence is
presumed so long as it can be proved that
there was a breach of the contract, and the
burden is on the defendant to prove that
there was no negligence in the carrying out
of the terms of the contract.

EG. Contract of carriage.

2) Right to the Fruits (Art. 1164, CC) – arises in obligation to give (real obligation)

 Fruits refer to natural, civil and industrial fruits

 The oblige is entitled to the fruits of the thing in obligations to give or deliver
 The right accrues from the time the obligation arises
 The obligation to deliver the fruit is required only when there is transfer of ownership.
 Note: Even though the thing may have been delivered, if the contract does not involve transfer of
ownership, there is no right to the fruits. The fruits will still pertain to the owner. Ex: commodatum,
lease, deposit.

3) Right to Accession (Art. 1166) – arises in obligation to give (real obligation) - obligation to deliver
accessories.

 In obligations to give or deliver a thing

 Present even when it is not mentioned
 A contrary intent, however, will prevail.

To be differentiated from fruits under Art. 1164, the term accessions in the present article refers to the
accession continua, including the accession natural, such as alluvion, and accession industrial, in its
three forms of building, planting or sowing. (Tolentino)

1. Breaches of Obligations

A. Default or Delay

 Requisites:

a. That the obligation be demandable and already liquidated;

b. That the debtor delays performance; and
c. That the creditor makes a judicial or extrajudicial demand

 Art. 1169, CC – 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.

 Note: The demand required in Article 1169 of the Civil Code may be in any form, provided that it can
be proved.

 The proof of this demand lies upon the creditor. Without such demand, oral or written, the effects of
default do not arise. (Cetus Development vs. Court of Appeals, G.R. No. 77648, August 7, 2019)

Default or Delay as a Ground for Payment of Damages:

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 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. (Pineda vs. Vda. De Vega, G.R. No. 233774, April 10, 2019 [Caguioa])

When demand is not necessary to put the debtor in default:

 When the obligation or the law expressly so declares;

 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; (eg. Insurance) or
 When the demand would be useless, as when the obligor has rendered it beyond his power to perform
(Art. 1169, CC) – eg. Impairment of securities.

Demand which Interrupts the Prescriptive Period to File Action

 The prescription of actions is interrupted when they are filed before the court, when there is
extrajudicial demand by the creditors, ad when there is any written acknowledgment of the debt by
the debtor. (Art. 1155, CC)

 The interruption of the prescriptive period by written extrajudicial demand means that the said
period would commence anew from the receipt of the demand.

 x x x A written extrajudicial demand wipes out the period that has already elapsed and starts anew
the prescriptive period.
Delay in Reciprocal Obligations

 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 that is incumbent upon him.

 From the moment one of the parties fulfills his obligation, delay by the other begins. (Art. 1169, CC)

 In a reciprocal obligation, the performance of one is conditioned on the simultaneous fulfillment of

the other obligation. A reciprocal obligation has been defined as that “where each of the parties is a
promisee of a prestation and promises another in return as a counterpart equivalent of the other.

Note: this is not applicable in conditional sale.

B. FRAUD – when present, it can either annul the contract or make the obligor liable for
damages – Art. 1170, NCC.

 Dolo causante – is it a kind of fraud which determines or is the essential cause of the consent.

Note: This is a ground for annulling the contract.

 Dolo incidente – it is a kind of fraud which does not have such decisive influence and by itself cannot
cause the giving of consent, but refers only to some particular or accident of obligation.

Note: This is a ground for payment of damages.

 Acts not considered fraudulent:

Art. 1340 - The usual exaggerations in trade, when the other party had an opportunity to know the
facts, are not in themselves fraudulent.

Art. 1341 - A mere expression of an opinion does not signify fraud, unless made by an expert and the
other party has relied on the former’s special knowledge.

Art. 1342 - Misrepresentation by a third person does not vitiate consent, unless such
misrepresentation has created substantial mistake and the same is mutual.

Art. 1343. Misrepresentation made in good faith is not fraudulent but may constitute error.

C. Fortuitous Event

 Art. 1174, NCC – except in cases expressly specified by the law, or when it is otherwise declared by
stipulation, or when the nature of the obligation required the assumption of risk, no person shall be
responsible for those events which could not be foreseen or which, though foreseen, were inevitable.

GR: Debtor/obligor is not liable to breach of contract in cases where there is fortuitous event.

 Elements to exempt the obligor from the liability for a breach of an obligation by reason of fortuitous
event:Mondragon v. CA, 2005.

a. The cause of the unforeseen and unexpected occurrence or of the failure of the debtor to comply
with obligations must be independent of human will;

b. It must be impossible to foresee the event that constitutes the caso fortuito or, if it can be
foreseen, it must be impossible to avoid;

c. The occurrence must be such as to render it impossible for the debtor to fulfill obligations in a
normal manner; and

d. The obligor must be free from any participation in the aggravation of the injury or loss.

XPN: Art. 1174, NCC: In these cases, the obligor assumes the risk of loss even if the loss is caused by a
fortuitous event.

a. In cases expressly specified by law - EG – Commodatum, Deposit, Negotiorium Gestio.

b. When it is declared by stipulation - EG – Insurance.

c. When the nature of the obligation required the assumption of risk.

2. Remedies for Breach of Obligation

 Specific performance /sum of money: The debtor must perform what he or she is obliged to do.
Obligations arising from contracts have the force of law between the contracting parties and should be
complied with in good faith 0 Art. 119, NCC.

 Rescission

1. Implied reciprocal obligations (Art. 1191, NCC)

2. Requires substantial breach. The policy of the law is to sustain the contract and allow the obligor to
perform the obligation.

GR: Substantial – impact to the principal obligation. If the contract is divisible, then rescission cannot
yet be availed of.

XPN: Laws which allows filing of Rescission.

a. Art. 1484 – Recto law: Sale of personal property on installment. (Failure of the buyer to pay3 or
more installment.)

b. RA 6552 - Maceda law:

GR: 2 years of non-payment, rescission.

XPN: Cancellation – whether less than or more than 2 years, the creditor may rescind the
contract if the buyer failed to pay within the grace period.

EG – 60 days + 30 days = 90 days race period.

3. Availed when the creditor has no other recourse.

 Damages; where appropriate: Source of damages: Art. 1170 provides that those who, in the
performance of their obligations, are guilty of fraud, negligence or delay, and those who in any manner
contravene the tenor thereof, are liable for damages.

What kind of damages may be recovered?

Art. 2232 provides that in contracts and quasi-contracts, exemplary damages may be awarded if
the defendant acted in a wanton, fraudulent, reckless, oppressive or malevolent manner.

Generally, it is ancillary to the main relief, except when it is a separate action in cases of tort or
quasi-delict.

Note: Not all delay under art. 1169 may give rise to damages. It must be gross delay or delay that
is the result of Art. 1170. The obligation must be in the capacity of performing the obligation.

Doctrine of anticipatory breach – Under this doctrine, an unqualified and positive refusal to perform
a contract, though the performance thereof is not yet due, may, if the renunciation will go through the
whole contract, be treated as a complete breach which will entitle the injured party to bring his action at
once. (Blossom and Company v. Manila Gas, 1930).

The principle contemplates future periodic deliveries and refusal to comply therewith. Blossom Co.
entered into a contract with manila gas corp for the sale and delivery of water gas and coal gas at
stipulated prices for a period of four years. On the 2 nd year of the contract, manila gas willfully and
deliberately refused to deliver any coal and water gas to blossom company because it was asking for a
higher price than what has been previously stipulated by them. Hence, blossom was permitted to sue on
the contract.

C. Different Kinds of Obligations

KINDS OF OBLIGATIONS

1. Pure obligations

Note: By default, if there Pure obligations - those whose effectivity or

are no conditions attached, extinguishment does not depend upon the fulfillment
obligations are pure and or non-fulfillment of a condition or upon the
demandable at once. expiration of a term or period. It is demandable at
once.

A suspensive condition is a condition the fulfillment of

2. Conditional Suspensive which gives rise to an obligation of the party in whose
obligations conditions favor the condition is created.

Ex: full payment of the purchase price in a contract to

- Conditional obligations: sell

A resolutory condition is one which extinguishes rights

and obligations already existing.
those whose effectivity Resolutory
depends upon the conditions Ex: in a pacto de retro sale, the repurchase by the
fulfillment or non- previous owner extinguishes the previous sale, giving
fulfillment of a future and of support
uncertain fact or event.
– one that depends upon the exclusive will of one of
the parties. Under Art. 1182 of the Civil Code, it is
Potestative considered void.
When a condition is condition
deemed fulfilled – Art. Note:
1186, NCC.

When it is imposed on the perfection of the contract,

the contract is void. But if it is imposed on its
Article 1186. The
condition shall be fulfillment, on ly the condition is avoided, leaving
deemed fulfilled when unaffected the obligation itself.
the obligor voluntarily
- (Catungal vs. Rodriguez, G.R. No. 146839, March 23,
prevents its
2011)
fulfillment.

for the condition to be

considered fulfilled these
two requisites shall be
present.

1. Intent of the
obligor to prevent
fulfillment of the
condition
2. Actual prevention
of compliance

5. Obligations with a ◦ An obligation with

period a period is one
whose Note:
consequences are ◦ A period is presumed to have been established for the
subjected to the benefit of both creditor and debtor.
expiration of a
period or term. ◦ A potestative condition is different from an
obligation with a period. The former is void, the latter
is valid. The court may be asked to fix a period in an
Ex. Price in a obligation with a period.
contract of sale When debtor loses the right to use the period:
payable on Art. 1198, NCC. (when there is uncertainty that the
installment debtor will pay on the period agreed upon)

a. When after the obligation has been

contracted, he becomes insolvent, unless he
◦ The obligation is
gives a guaranty or security for the debt.
demandable only
when the day comes
b. When he does not furnish to the creditor the
(Art. 1193, CC) guaranties or secure ties which he has
promised.

c. When by his own acts he has impaired said

guaranties or securities after their
establishment, and when through fortuitous
event they disappear, unless he immediately
gives new ones equally satisfactory.

d. When the debtor violates any undertaking, in

consideration of which the creditor agreed to
the period.
 e. When the debtor attempts to abscond.

6. Alternative obligations There is more than one obligation, the performance of

one is sufficient.

◦ The debtor has the right of election, and the choice is

effective when it is communicated to the creditor.

◦ If the creditor is given the right of election, the

obligation ceases to be alternative from the time the
creditor communicates his choice.

◦ Distinguished from Facultative Obligations

● It is a facultative obligation when only one

prestation has been agreed upon, but the debtor may
render another in substitution.

7. Joint and solidary Joint In a "joint" obligation, each obligor answers only for a
obligations part of the whole liability;

Presume in favor of joint obligations

solidary In a "solidary" or "joint and several" obligation, the

relationship between the active and the passive
subjects is so close that each of them must comply
with or demand the fulfillment of the whole obligation.

When the law imposes solidary liability:

1. Liability for quasi-delicts (Malayan Insurance

vs. Court of Appeals, L-36413, September 26,
1988)

2. Liability of co-principals in a contract of

agency (Art. 1915, CC)

3. Liability of partners and the partnership in

wrongful acts committed against third persons
(Art. 1822 and 1823, CC)

4. Liability of two or more bailees in a

commodatum (Art. 1945, CC)

5. Corporate officers are solidarily liable with the

corporation for the illegal termination of
services of employees IF they acted with
malice or bad faith. (Polymer vs. Salamuding,
G.R. No. 185160, July 24, 2013)

Effects of solidary obligation:

In active solidarity or where there is solidarity of

creditors, each creditor is empowered to exercise
against the debtor not only the rights which
correspond to him, but also all the rights which
correspond to the other creditors with the consequent
obligation to render an accounting of his acts to such
creditors.

In passive solidarity or where there is solidarity of

debtors, each debtor is liable for the payment of the
entire obligation, with the consequent right to demand
reimbursement from the others for their
corresponding shares once payment has been made.

Novation, compensation, confusion or remission of

the debt, made by any of the solidary creditors or with
any of the solidary debtors, shall extinguish the
obligation.

But the remission made by the creditor of the share

 which affects one of the solidary debtors does not
release the latter from his responsibility towards the
co-debtors, in case the debt has been totally paid by
anyone of them before the remission was effected.
(Art. 1219, CC)

8. Divisible and
indivisible obligations
Whether it is divisible or
indivisible depends on the
law or the intention of the
parties.
Divisible Divisible obligations are which have for their object
obligations the execution of a certain number of days of work, the
accomplishment of work by metrical units and others
which are susceptible of partial performance
Indivisible Indivisible obligations are obligations to give definite
obligations things and those which are not susceptible of partial
performance

9. Obligations with a ∙ The penalty shall substitute the indemnity for

penal clause damages and the payment of interests in case of non-
compliance, if there is no stipulation to the contrary.
Nevertheless, damages shall be paid if:

● The obligor refuses to pay the penalty;

● The obligor is guilty of fraud in the fulfillment of the

obligation. (Art. 1226, CC)

The penalty is generally undertaken to ensure

performance and works as either, or both, punishment
and reparation. It is an exception to the general rules
on recovery of losses and damages. ∙

A penal clause must be specifically set forth in the

obligation. (Rivera vs. Spouses Chua, G.R. No. 184458,
January 14, 2015) ∙

When the breach of the contract committed by the

defendant is not the one contemplated by the parties
in agreeing upon the liquidated damages, the law shall
determine the measure of damages, and not the
stipulation – Art. 2228, NCC.

The amount of the penalty or liquidated damages may

be reduced by the court if found iniquitous or
unconscionable. (Medel vs. Court of Appeals, G.R. No.
131622, November 27, 1998)

D. Extinguishment of Obligations

1. Payment

a) Concept of Payment

 Art. 1231, NCC – Payment is a mode of extinguishing obligations and it means not only the delivery of
money but also the performance, in any other manner, of an obligation.

Requisites to say that a payment is complete:

Art. 1233, NCC – Integrity of payment: The thing or service in which the obligation exists must be
completely delivered or rendered.

Art. 1244, NCC – Identity of payment: The very thing, service or forbearance must be performed.

Art. 1248, NCC – Indivisibility of payment: The creditor cannot be compelled partially to receive
the Prestations in which the obligation consists. Neither may the debtor be required to make
partial payments.

 Barons Marketing v. CA, 1998 – A creditor has the right to reject a debtor’s offer to pay in installments.
Art. 1248 of NCC states that “Unless there is an express stipulation to that effect, the creditor cannot be
compelled to receive partial payments” Under this propvision, the prestation (ie. The object of the
obligation) must be performed in one acts not in parts.

 De castro v. CA, 2002 – Acceptance vs. Receipt: The word “accept” in Art. 1235 NCC means to take as
satisfactory or sufficient, or to agree to an incomplete or irregular performance. The mere “receipt of a
 partial payment is not equivalent to the required acceptance of performance as would extinguish the
whole obligation. The debtor must show that the creditor accepted the partial payment regardless of its
irregularities or incompleteness.

Note: if there is a partial payment, the obligation is not yet extinguished. There must be full payment for
an obligation to be extinguished.

When a creditor may accept payment by a When the debtor may pay to a third person
third person

a. When made by a third person who has an a. It has redounded to the benefit of the creditor.
interest in the fulfillment of the obligation.
b. The third person is in possession of the credit
b. When there is a stipulation to that effect that a in good faith.
third person may pay the obligation.
(E.g. – Insurance, Surety, Guarantee)

 Sec. 1, RA 8183: GR – Payment shall be made in the legal tender. (Philippine currency)
XPN: The parties may agree that the obligation or transaction be settled in another currency.

 Art. 1249, NCC – Promissory notes, checks, etc. shall have the effect of payment only when they have been
cashed or when through the fault of the creditor they may have been impaired.

 Fortunado v. CA, 1991 – A check may be used for the exercise of the right of redemption, the same being a
right and not an obligation. The tender of a check is sufficient to compel redemption but is not in itself a
payment that relieves the redemptioner from his liability to pay the redemption price.

 Padrigon v. Palmero, 2020 – A check constitutes evidence of indetebness and is veritable proof of an
obligation that can be used in lieu of and for the same purpose as a promissory note. Thus, the checks,
completed and delivered to respondent, are sufficient per se to prove the existence of the loan obligation
of petitioner to respondent.

 Application of payments – when there is more than 1 obligation between a creditor and debtor – it is the
designation of the debt to which payment must be applied when the debtor has several obligations of the
same kind in favor of the same creditor.

GR: It is the debtor’s right to choose on which debt shall the payment be applied.
XPN: The creditor may make the selection if the debtor does not elect or when there is an agreement to
that effect.

 Art. 1253, NCC – Payment shall be applied on the interest first, in case the debt incurs interest.

GR: The imposition of an unconscionable interest rate is void ab initio for being contrary to morals and
law.

Bulatao v. Stonactoc, 2019: IMPORTANT

Since the interest rate in this case is void for being unconscionable, the interest rate prescribed by BSP for
loans and forbearance of money, credit and goods shall be applied not only for the 1 year interest period
agreed upon but for the entire period that the loan of Zenaida remains unpaid.

In a situation wherein void interest rates are imposed under a contract of loan, the non-payment of the
principal obligation does not place the debtor in a stat default, considering that Art. 1251 of NCC states
that if a debt produces interest, payment of the principal debt shall not be deemed to have been made
until the interests have been covered.

Since the obligation making interest payments is illegal and non-demandable, the payment of the
principal loan was likewise not yet demandable on the part of creditor. With the debtor not being in a
state of default, the foreclosure of the subject properties should not have proceeded.

b) Payment by Cession vs. Dation in Payment

Dation in payment Payment by cession

A thing in exchange for money. The thing is offered by

the debtor. Conveyance of property. However, compared in
dation, here there is 1 debtor and more than 1
Requisites: creditor.
 a. The existence of monetary obligation. This takes place when the debtor cedes or assigns his
(However, the debtor cannot pay money so he property to his creditors in payment of his debts.
offers to convey to the creditor a determinate
thing to satisfy the monetary obligation of Compared to dation in payment, cession involves
debtor.) plurality of creditor, partial or complete insolvency,
b. Alienation to the creditor of a property by the universality of property ceded and the release is to the
debtor with the consent of the former (The extent of the proceeds of the things ceded or assigned.
creditor must accept the payment in kind in
lieu of money) Note: FRIA – financial rehabilitation insolvency act.
c. Satisfaction of the money obligation of the
debtor.
Application of the law on sales: Adequacy of the price,
warranties.

Adequacy of the price:

E.g. – The debtor is obliged to pay the creditor 1M

however he does not have money to pay the same.
Debtor has a car worth 800K. The debtor conveyed
the car as payment of his debt and the debtor accepted
the same.

Although there is inadequacy of the price, the payment

is valid and satisfies the monetary obligation of debtor
if the creditor fully accepted the car as payment. (Kahit
mababa yung price, as long as there is a meeting of the
mind such that the creditor agreed to receive the car as
payment, there is consent)

E.g. - The debtor is obliged to pay the creditor 100K

however he does not have money to pay the same.
Debtor has a car worth 800K. The debtor conveyed
the car as payment of his debt and the debtor accepted
the same.

Although there is inadequacy of the price, the payment

is valid and satisfies the monetary obligation of debtor
since the debtor consented to such agreement. (Kahit
mababa yung price, as long as there is a meeting of the
mind such that the debtor agreed to give the car as
payment, there is consent)

GR: Gross inadequacy of the price does not affect the

validity of the contract.

XPN: when the inadequacy of the price manifests

vices of consent or the parties intended that the
contract be a donation.

Warranties:

If the debtor turns out to be not the owner of the thing

substituted, the creditor may demand the payment of
the monetary obligation.

Note: Warranty against hidden defect does not apply.

c) Tender of Payment and Consignation

Tender of payment Consignation

Tender of payment is the manifestation of the
debtor to the creditor of his decision to comply
immediately with his obligation.
Tender of payment prevents the seller to avail
the remedies of unpaid seller.
Consignation is the act of depositing the thing due with the
court or judicial authorities whenever the creditor cannot
accept or refuses to accept payment and it generally requires
a prior tender of payment.

When tender of payment is excused: Requisites of valid consignation:

 a. When the creditor is absent or
unknown, or does not appear at the
place of payment.
b. When the creditor is incapacitated to
receive the payment at the time it is
due. (XPN – if there is an
administrator. E.g. – Wife)
c. When, without just cause, he refuses to
give a receipt.
d. When two or more persons claim the
same right to collect.
e. When the title of the obligation has
been lost. (Nawala yung check,
consignation na wag na mag tender of
payment)
a. There was a debt due.
b. The consignation of the obligation had been made
because the creditor to whom tender of payment was
made:
1. refused to accept it
2. Is absent or incapacitated
3. Was absent to be entitled to receive the amount
due or because the title to the obligation has been
lost.
c. Previous notice of the consignation had been given to
the person interested in the performance of the
obligation.
d. The amount due was placed at the disposal of the
court.(There must be a deposit of payment to court)
e. After the consignation had been made, the person
interested was notified thereof.
Same grounds in interpleader case. However, the difference is
that compared to consignation, there is no due and
demandable obligation on the part of interpleader.

Del Carmen v. Sabordo, 2014 – for a consignation or deposit

with the court of an amount due on a judgment to be
considered as payment, there must be prior tender to the
judgment creditor who refused to accept it.

GR: There must be tender of payment first. Without which,

consignation is invalid.

XPN – Arzaga v. Rumbaoa, 1952: The deposit made with the

court by the plaintiff-appellee in the said case is considered a
valid payment of the amount adjudged, even without a prior
tender of payment thereof to the creditor, because the debtor,
upon making such deposit, expressly petitioned the court that
the creditor be notified to receive the tender of payment.
(Substantial compliance)

2. Loss of the Thing Due

a) Concept of Loss

 In obligations to give, loss, as a mode of extinguishing an obligation, depends on the thing involved:

1. If the thing is determinate, the obligation is extinguished.

2. If the thing is generic or indeterminate, the obligation is not extinguished following the principle of
genus nunquan perit or the genus of a thing can never perish. (The thing can be replaced)

 In obligations to do, the obligation is extinguished when the prestation becomes legally or physically
impossible without the fault of the obligor.

Grounds for extinguishment of obligation to do:

1. Legal impossibility – when the act stipulated to be performed is subsequently prohibited by law.

2. Physical impossibility – when the act is supposed to be performed by the obligor due to reasons
subsequent to the execution of the contract, could not be physically performed by the obligor.

3. Service has become so difficult as to be manifestly beyond the contemplation of parties – moral
impossibility due to certain conditions.

Example: Victor together with other construction workers, agreed to construct a road near a
mountain. A hurricane caused landslide making the construction of the road dangerous to human
lives. In this case, Victor may be released, in whole or in part, from his obligation to continue with the
construction.

Rebus sic santibus – a legal doctrine allowing for a contract or a treaty to become inapplicable because of
a fundamental change of circumstances.
 Art. 1266, NCC – The debtor in obligations to do shall also be released when the prestation becomes
legally or physically impossible without the fault of the obligor.

Art. 1267, NCC – When the service has become so difficult as to be manifestly beyond the contemplation
of the parties, the obligor may also be released therefrom, in whole or in part.

b) Requisites

1. Obligation is a determinate thing.

2. Loss is w/o fault of the debtor.
3. Obligor is not in delay.
4. Obligor is not in bad faith.

Note: Obligor has an added obligation to take care of the thing with diligence of a good father of a family,
otherwise he is negligent.

Loss Delay

a. The thing perishes.

a. Debtor cannot
b. The thing goes out of commerce. deliver on due
date.
c. The thing disappears in a way that its existence is unknown or cannot be
recovered. b. If after delay,
the thing is lost
due to
d. There is theft or robbery ( debtor bears the burden of proof. He must
fortuitous
show that he could not resist the violence.)
event, debtor is
libale.
-debtor is liable for damages if he is negligent. (i.e. he placed the thing
within the reach of thieves and not in secure/safe place)

e. Impossible because the thing to be delivered belongs to another.

Note: If the loss is without the debtor’s fault, he has the burden to prove his
innocence.

The debtor is not exempted from liability when:

a. The law so provides

b. The stipulation so provides.
c. The nature of the obligation requires the assumption of risk .
d. The obligation to deliver a specific thing arises from a crime.

Effect on reciprocal obligation:

a. The extinguishment of obligation due to loss or impossibility of performance affects both the debtor
and the creditor.

b. The entire juridical relation is extinguished.

c. The debtor must return to the creditor whatever he has received by reason of the obligation.

 Application in sales – Art. 1262, NCC: After the perfection of the contract, the object is lost due to
fortuitous event. The debtor is freed if he has no participation; if not, he is liable for damages.
 Effect of partial loss of a specific thing – Art. 1267, NCC: There is a partial loss when only a portion of the
thing is lost or destroyed or when it suffers depreciation or deterioration. Partial loss is the equivalent of
difficulty of performance in obligation to do.
In case of partial loss, the court is given the discretion, in case of disagreement between parties, to
determine whether under the circumstances it is so important in relation to the whole as to extinguish the
obligation.

In other words, the court will decide whether the partial loss is such as to be equivalent to a complete or
total loss – Art. 1264, NCC.

 Presumption of fault on the part of obligor – Art. 1265, NCC: Whenever the thing is lost in the possession
of the debtor, it shall be presumed that the loss was due to his fault, unless there is proof to the contrary,
and without prejudice to the provisions of Art. 1165. This presumption does not apply in case of fortuitous
events (earthquake, storm, natural calamities)
 Rationale: The debtor is obliged to take care of the thing with due diligence required by law.

Under Art. 1165, NCC – the obligor who is not at fault is still liable in case he is guilty of delay or he has
promised to deliver the same thing to two or more persons who do not have the same interest.

c) Force Majeure

GR: Fortuitous event does not necessarily extinguish the obligation to deliver a determinate thing.

XPN: It shall be extinguished when the determinate thing shall be lost or destroyed without the fault of
the obligor/debtor and before he is in default.

Debtor liable for damages - Art 1262, NCC:

When by law or stipulation, the obligor is liable for fortuitous event, the loss of the thing does not
extinguish the obligation, and he shall be responsible for damages. The same rule applies when the
nature of the obligation requires the assumption of risk.

Debt proceeds from criminal offense - Article 1268, NCC:

When the debt of a thing certain and determinate proceeds from a criminal offense, the
debtor shall not be exempted from the payment of its price, whatever may be the cause for
the loss, unless the thing having been offered by him to the person who should receive it,
the latter refused without justification to accept it.

When debtor offers a payment and the creditor refuses to receive it, he may:

a. Consign the thing and thereby be relieved from any responsibility for such thing.
b. To keep it in his possession, with due diligence.

Example: Daniel stole Charity’s watch, Daniel has the obligation to return it to Charity. The obligation of
Daniel arises from an act punishable by law. Even if the watch is lost without the fault of Daniel, he shall
be liable for the payment of the price of the watch. The exception to the rule is when is Charity in
mora accipiendi. In either case, Daniel is liable if the loss is due to his fault. MORA ACCIPIENDI  (mora of
the creditor) – the delay of the obligee or creditor to accept the delivery of the thing which is the object of
the obligation.

Right of creditor against 3rd persons by reason of loss – Art. 1269, NCC: The obligation having been
extinguished by the loss of the thing, the creditor shall have all the rights of action which the
debtor may have against third persons by reason of the loss.

Example: Miko promised to deliver a Ferrari car to Vanie. The car was lost due to the fault of a third person
Emerson. Vanie has a right to recover the price of the car plus damages from Emerson.

3. Condonation

Requisites:

a. It must be gratuitous.
b. It must be accepted by the debtor.
c. The obligation must be demandable.

Note:

a. It may become dation in payment when the creditor receives a thing different from that stipulated.

b. It may become a novation when the object or principal conditions of the obligation should be
changed.

c. It may become a compromise when the matter renounced is in litigation or dispute and in exchange of
some concession which the creditor receives.

4. Confusion - It is the merger of the characters of the creditor and the debtor in one and the same person by
virtues of which the obligation is extinguished. Note: Debtor acquires the interest of the creditor.

Requisites:

a. That the characters of creditor and debtor must be in the same person.
b. That it must take place in the person of either the principal creditor or the principal debtor.
c. It must be complete and definite.
5. Compensation: It is the extinguishment in the concurrent amount of the obligation of those persons who
are reciprocally debtors and creditors of each other.

Types:

a. Legal compensation – by operation of law.

b. Voluntary or conventional compensation.

a) Requisites

Requisites of legal compensation:

1. That each one of the obligors be bound principally, and that he be at the same time a principal
creditor of the other.
2. That both debts consist in a sum of money, or if the things due are consumable, they be of the same
kind, and also of the same quality if the latter has been stated.
3. That the two debts are due and demandable.
4. That they be liquidated and demandable.
5. That over neither of them there be a retention or controversy, commenced by third persons and
communicated in due time to the debtor.

Requisites of conventional compensation:

1. That each of the parties can dispose of the credit he seeks to compensate.
2. That they agree to mutual and extinguishment of their credits. (There must be stipulation)
3. There must be meeting of the mind (Compared to legal compensation where consent is not required)

Note: In conventional compensation, it is not required that the obligation is already due and
demandable.

b) Compensation of Rescissible and Voidable Debts

c) Non-Compensable Debts

6. Novation

a) Concept of Novation

It is the extinguishment of an obligation by the substitution or change of the obligation by a

subsequent one which extinguishes or modifies the first, either:

1. By changing the object or principal conditions.

2. By substituting another in place of the debtor.
3. By subrogating a third person in the rights of the creditor.

Kinds of novation

a. By changing the object

b. By substituting another in
the place of debtor.
c. By subrogating another in
place of the debtor.

b) Expressed and Implied Novation

(1) Requisites

a. In expressed novation, the requisites are as follows:

1. There must be a previous valid obligation.

2. There must be an agreement of the parties concerned to a new contract.
3. There must be the extinguishment of the old contract.
4. There must be the validity of the new contract.

c) Expromision and Delegacion Distinguished

Substitution by expromision The initiative of change does not come from – and may even be made
 without the knowledge of – the debtor.

It consists of a third person’s assumption of the obligation.

Substitution by delegacion The debtor offers, and the creditor accepts, a third person who consents to
the substitution and assumes obligation.

Bognot v. RRI Lending, 2014 – in both cases, novation by substitution must always be made with the consent of
the creditor.

(1) Consent Required

(2) Effect of Insolvency of New Debtor

d) Legal and Conventional Subrogation

It is the transfer of all the rights of the creditor to a third person, who substitutes him in all his rights.

Types of subrogation:

1. Legal subrogation – is that which takes place without agreement but by operation of law because of
certain acts.

E.g. – Insurance payouts or indemnities where the insurer is subrogated to the rights of the insured
against the third person who caused the damage or injury. (e.g. – guaranty/suretyship)

2. Conventional subrogation – is that which takes place by agreement of the parties.

Conventional subrogation extinguishes the obligation and gives rise to an new one –(Can be
compared to assignment of right)

II. Contracts
A. General Provisions

1. Definition of a Contract - It is a meeting of the minds, with respect to the other, to give something or
render some service. KR: Meeting of the minds, parties, obligation.

2. Elements of a Contract

a) Essential elements

Consent
Object
Cause/Consideration

Types of contracts – determines the perfection of contracts

Real Involves real obligation – obligation to deliver something.

Contract is perfected by consent and delivery of the thing.

Example: Credit transactions, (Mortgage, loan, deposit, mutuum/ commodatum)

Consensual Contracts which involves obligation to do – perfected by mere meeting of the mind/consent.

Example: Sales, lease, partnership, agency

Solemn Perfected not merely by consent but by execution of the proper form.

Example: Partnership involving contribution of real property – it should be in writing and in

an instrument.

Donation of real property, value of which is more than 5,000, must be in writing and shall be
accepted. If less than 5,000 – there must be delivery of the thing.

Agency to sell real property – must be in writing otherwise void.

Characteristics of contracts:
1. Obligatoriness – the contract is the law between the parties and must be complied with in good
faith – Art. 1159, NCC.

2. Autonomy – The contracting parties may establish such stipulations, clauses, terms and conditions
as they may deem convenient, provided they are not contrary to law, morals, good customs, public
order, or public policy – Art. 1306, NCC.

Note: Autonomy of contracts is superior to law – thus, the law applies only when the contract is silent.
As long as it is not contrary to law, the contract shall prevail over the law.

3. Mutuality – contracts bind all parties, and the validity and compliance of contracts cannot be left to
the will of one of the parties. It is for this reason that potestative obligation is void.

Art. 1182, NCC – when the fulfillment of the condition depends upon the will of the debtor, the
conditional obligation shall be void.

4. Relativity – contracts takes effect only between:

GR: Only between the parties.

XPN:

a. Assigns – the persons to whom the contract or rights and obligations are transferred.
b. Heirs – persons who will inherit in case of death of the parties.
c. Stipulation in favor of 3rd persons – stipulation pour atrui.

Stipulation pour atrui – Art. 1311, NCC: Requisites

a. The contract contains a stipulation in favor of third persons.

b. The stipulation in favor of third person must be only part and not the whole of the contract.
c. The contracting parties clearly and deliberately conferred a favor upon a third person and not
merely incidental benefit or interest.
d. The favorable stipulation must not be compensated by any obligation.
e. The third person must communicate his acceptance to the obligor before its revocation.
f. The contracting parties are not legal representatives or duly authorized by the third persons to
enter into the contract that gives the latter benefit.

Examples:

1. Insurance contract – the proceeds is payable to the beneficiary.

2. Sale with mortgage

Tortious interference – Art. 1314, NCC: Requisites

a. The existence of a valid contract

b. The third person must be aware of the existence of the contract
c. The interference of the third person must be without legal justification or excuse.

Illustration: when a third person induces a manufacturer/supplier to revoke its exclusive

distributorship agreement with another so as to enter into a new distributorship agreement with the
former – Excellent essentials v. Extra Excel, 2018.

Remedy: Action for damages filed by a party to a contract against a stranger/third persons.

Dsitinguished form accion pauliana under Art. 1387, NCC:

a. It is an action to rescind a contract entered in fraud of creditors.

b. It is initiated by a stranger/third person against parties to a contract.

Requisites: Anchor savings bank v. Furigay, 2013

a. That the plaintiff asking for rescission has a credit prior to the alienation although demandable
b. That the debtor has made a subsequent contract conveying a patrimonial benefit to a third
person.
c. That the creditor has no other remedy to satisfy his claim, but would benefit by rescission of the
conveyance to the third person.
d. That the act being impugned is fraudulent.
e. That the third person who received the property conveyed, if by onerous title, has been an
accomplice in the fraud.
 E.g – when the parties entered into a contract to sell but the seller sold the property to a third
party who is in bad faith (aware of the sale between buyer and seller)
- applicable also in cases where there is a right of first refusal.

b) Natural Elements

B. Basic Principles of Contracts

1. Obligatory Force of a Contract

2. Freedom to Stipulate (Autonomy of the Will) and its Limitations

3. Binding Effect of a Contract

4. Privity of Contract

a) Concept

b) Exceptions to the Rule on Privity of Contracts

5. Consensuality of Contracts

a) Concept and Coverage

b) Exceptions

c) Reformation of Instruments

C. Essential Requisites of a Contract

1. Consent

 Art. 1319, NCC - It is manifested by the meeting of the offer and acceptance upon the thing and the cause
which are to constitute the contract.

Rules as to the offer and acceptance:

a. An offer is a manifestation of willingness to enter into a bargain, so made as to justify another person
in understanding that his assent to that bargain is invited and will conclude it.

b. Acceptance means signification of conformity with all the terms of the offer. The acceptance must be
unqualified and unconditional.

In shopee deliveries – the offeror is the one who ordered the parcel and the merchant is the one who
accepts the offer. Upon acceptance by the merchant, there is now consent of both parties to enter into
contract.

 Who may give consent:

a. Natural persons – human beings with legal capacity to give consent.

1. Must be 18 years old.

2. Must not be suffering from anything which restricts their capacity to give consent.
3. Art. 1327, NCC – provides that minors cannot give consent to a contract. (Art. 234, FC – age of
majority is 18)

b. Juridical persons – entities formed by association of human beings in accordance with law.

Juridical persons can only act through their authorized representatives.

In partnership, the capacity of partners is a continuing requirement. Thus, if any of the partners
become insolvent, suffers civil interdiction, becomes absent w/o administrator, the partnership is
dissolved.
 Vices of consent

Vices of consent
 1. Mistake As to the thing, conditions, or the
identity of a party.

2. Intimidation Reasonable fear of an impending

and grave evil (moral)

3. Violence Serious or irresistible force

(physical)

4. Undue influence Improper advantage of power over

the will of another

5. Fraud Deceptions, insidious

machinations and manipulations

2. Object

 Within the commerce of man – things and services are outside the commerce of man if they cannot be
appropriated or they are incapable of private ownership or if they are intransmissible.
 Licit and not contrary to law, morals, good customs, etc.
 Must not be impossible (physically, legally and practically)
 Must be determinate or at least determinable

a. The thing must be determinate as to its kind and quantity.

b. The thing is determinable if the same can be determined without that need to enter into an
agreement.

3. Cause or Consideration

 In onerous contracts – the prestation or promise of a thing or service by the other.

 In remuneratory contracts – the service or benefit which is remunerated.
 In gratuitous contracts – the mere liberality of the benefactor.

a. It is presumed to exist in every contract – Art. 1354, NCC.

b. It must be licit or lawful – Art. 1352, NCC.
c. It must be true – Art. 1353, NCC.

Form of contracts:

a. Contracts are valid in whatever form – Art. 1356, NCC. When form is indispensable for its validity; when
it is merely for convenience.

b. Contracts that must be in a public instrument – Art. 1358, NCC.

1. Contracts involving real rights over immovable property, sale of property or any interest therein.
2. Cession, repudiation or renunciation of hereditary rights or those of the CPG.
3. Power to administer property, power that may prejudice third persons.
4. Cession of actions or rights proceeding from an act appearing in a public document.

Note: PD 1529, Sec 51.

Note – if the question is regarding the validity of contract, article 1358 does not apply. The contract is
valid since form is not an essential element of the contract. Article 1358 is an obligation sourced from law.
Therefore, it is a right of one party to demand compliance with the form for purposes of convenience and
thereby compliance with the other requirements of law.

XPN: Certain contracts must be in writing to be enforceable – Art. 1403, NCC.

The civil code requires certain transactions to appear in public documents. However, the necessity of
public document for contracts which transmit or extinguish real rights over immovable property, as
mandated by Art. 1358 of NCC, is only for convenience, it is not essential for the validity or enforceability
– Teoco v. Metrobank, 2008.

Reformation of instruments:
  When reformation is proper:

a. There must have been a meeting of minds of the parties to the contract.
b. True intention of the parties not expressed.
c. Due to mistake, fraud, inequitable conduct or accident in the preparation of the instrument. (It is the
vice of preparation, not the vice of consent.)

 When is reformation not proper: consent is not necessary in these cases.

a. Donations inter vivos wherein no condition is imposed.

b. Wills
c. When the real agreement is void.

Interpretation of contracts:

If the terms are clear and unambiguous The literal meaning of the terms used is the
controlling factor.

If the meaning of the words is contrary to the evident The evident intent prevails

The contemporaneous or subsequent act should be

considered

When there is a conflict between a general provision The particular provision or specific provision prevails.
and particular provision

Contract of adhesion

 One in which one of the parties imposes a ready-made form of contract, which the other party may accept
or reject, but which the latter cannot modify.

 One party prepares the stipulation in the contract, while the other party merely affixes his signature or his
adhesion thereto giving no room for negotiation and depriving the latter of the opportunity to bargain on
equal footing.

 Not valid per se. The terms of which must be interpreted and enforced stringently against the party which
prepared the contract.

D. Defective Contracts

1. Rescissible Contracts

Contracts, although validly agreed upon, which can be rescinded by reason of lesion or economic prejudice.
Lesion is the injury suffered by one who does not receive a full equivalent for what he gives in a commutative
contract.

Notes on rescission:

a. Rescission creates the obligation to return the things which were the object of the contract,
together with their fruits, and the price with its interest.

b. He who demands rescission must be able to return whatever he may be obliged to restore.

c. The action for rescission is subsidiary; it cannot be instituted except when the party suffering
damage has no other legal means to obtain reparation for the same.

d. The action for rescission must be commenced within 4 years.

Requisites:

a. A contract initially valid

b. Lesion or pecuniary prejudice to someone.

Rescissible contracts under Art. 1381, NCC

1. Those which are entered into by guardians

whenever the wards whom they represent
suffer lesion by more than ¼ of the value of
the things which are the object thereof.
(nalugi)
 2. Those agreed upon in representation of
absentees, if the latter suffer the lesion stated
in the preceding number.
3. Those undertaken in fraud of creditors when
the latter cannot, in any manner, collect the
claims due to them.
4. Those which refer to things under litigation if
they have been entered into by the defendant
without the knowledge and approval of the
litigants or of competent juridical authority.
5. All other contracts specially declared by law
to be subject to rescission.

Difference between rescission under Art. 1191 and rescissible contracts under Art. 1381

Art. 1191, NCC – rescission Art. 1381, NCC – rescissible contracts

Applies only to reciprocal obligations where one Applies to contracts where there is lesion, economic
party fails to comply with his obligation under the disadvantage and fraud committed against
contract. Substantial breach is required creditors.

Can only be asserted by a party to the contract Can be asserted even by a third person.

Wellex v. U-land Airlines, 2015 – The SC held that the failure of one of the parties to comply with its
reciprocal prestation (obligation) allows the wronged party to seek the remedy of Art. 1191. The wronged
party is entitled to rescission or resolution under article 1191 and even the payment of damages.

On the other hand, Art. 1381 pertains to rescission where creditors or even third persons not privy to the
contract can file an action due to lesion or damage as a result of the contract.

2. Voidable Contracts - Generally, those where one of the parties is incapable of giving consent, or when
the consent is vitiated by mistake, violence, intimidation, undue influence or fraud.
Note:

a. The action to annul a contract may be lost due to:

Prescription – 4 years
Ratification by the injured party.

Example: Contracts entered into by a minor is voidable as it can be ratified.

3. Unenforceable Contracts

 Those entered into in the name of another by one without or acting in excess of authority.
 Those where both parties are incapable of giving consent (if only one of the parties is incapable of
giving consent, the contract is voidable)
 Those which do not comply with the statute of frauds.

Agreements covered by the Statute of frauds: Art. 1403, NCC – agreements shall be in writing.

a. Agreements not to be performed within a year from the making thereof.

b. Special promise to answer for a debt, default or miscarriage of another.
c. Agreement in consideration of marriage other than a mutual promise to marry.
d. Agreements for the sale of goofs, etc. at a price not less than P500.00.
e. Contracts of lease for a period longer than one year.
f. Agreements for the sale of real property or interest therein.
g. Representation as to the credit of a third person.

Note:

a. The statute of fraud requires that the contract be evidenced by some note, memorandum or any
writing.
b. The statute of frauds applies only to executory contracts.
c. The contracts supposedly covered by the statute of frauds become enforceable when they are ratified.

4. Void Contracts

 Void and inexistent contracts – Art. 1409, NCC.

 1. Those whose cause,
object or purpose is
contrary to law, morals,
good customs, public
order or public policy.
2. Those which are Art. 1345, NCC - Simulation of contracts may be absolute or relative.
absolutely simulated or The former takes place when the parties do not intend to be bound at
fictitious. all. The latter, when the parties conceal their true agreement.

G. Holdings v. Cagayan Electric – An absolute simulated or fictitious

contract is void while a relatively simulated contract when it does not
prejudice a third person and is not intended for an purpose contrary to
law, morals, good customs, public order or public policy, binds the
parties to their real agreement.

3. Those whose cause or

object did not exist at the
time of the transaction.
4. Those whose object is
outside the commerce of
man.
5. Those which contemplate
an impossible service.
6. Those where the
intention of the parties
relative to the principal
object of the contract
cannot be ascertained.
7. Those expressly
prohibited or declared
void by law.

Note:

 A void contract produces no legal effect

 It cannot be ratified
 The right to set it up as a defense does not prescribe
 The action to declare the nullity of a contract does not prescribe
 Courts will leave the parties as they are following the in pari delicto rule.

What is the doctrine of in pari delicto? – Loria v. Munoz, 2014 - Under this doctrine, no action arises, in
equity or at law, from an illegal contract. No suit can be maintained for its specific performance or to recover the
property agreed to be sold or delivered, or the money agreed to be paid, or damages for its violation. An exception
to the doctrine is – when its application contravenes well-established public policy.

Examples of void contracts:

a. Tee v. Tacloban electric, 1959 – a contract of agency for “following up papers in the different government
offices to which they were referred”. (Fixers)
b. Tiu v. Platinum plans, 2007 – a non-involvement clause, or that which indefinitely prohibits an employee
from engaging in any business similar to that of his employee after the termination of his employment
contract. (Perpetually prohibiting an employee to be employed after termination of employment
contract.)
c. Osmena v. COA, 1994 - A compromise agreement for the settlement of an obligation arising out of a void
contract.
d. Andal v. PNB, 2013 – Any stipulation where the fixing of interest rate is the sole prerogative of the
creditor/mortgagee. (Potestative condition)
e. Landbank v. Cacayuran, 2013 – a loan obtained by the municipality for the purpose of funding the
conversion of the public plaza ( a property of pubic dominion) into a commercial center.
f. Fullido v. Grilli, 2016 – a contract of lease in favor of an alien for a period of 50 years, renewable for
another 50 years, whereby the owner/lessor is prohibited from selling, donating, or encumbering her land
to anyone without the written consent of the alien lessee.

Note: here in this case, allowed fulido to recover the property but did not allow the alien to recover the
fund. Pari delicto cannot be applied since if it will be applied, the foreigner will remain in possession of
the real property, in contrary with the mandate of the constitution.

Natural Obligations Art. 1423, NCC.

a. Natural obligations are not based on positive law but on equity and natural law.
 b. They do not grant a right of action to enforce their performance.

c. After voluntary fulfillment by the obligor, they authorize the retention of what has been delivered or
rendered by reason thereof.

Not a right to demand, but a right to retain. In order to that there may be a natural obligation, there must
exist a juridical tie which is not prohibited by law, and which could give a cause of action, but because of
some special circumstances is without such legal sanction or means of enforcing compliance by invoking
the intervention of the court.

Ansay v. the Board of directors, 1960 – an element of natural obligation before it can be cognizable by the
court is voluntary fulfillment by the obligor. Certainly, retention can be ordered but only after there has
been voluntary performance.

The term “voluntary” may be understood as spontaneous, free from fraud or coercion, or it may be
understood as meaning with knowledge, free from error.

Natural obligations as proper subject of guaranty – Art. 2052, NCC:

The guaranty of the natural obligation changes its character. When a debtor offers a guarantor for his
natural obligation, he impliedly accepts the coercive remedies to enforce the guaranty, and therefore, the
transformation of the natural into a civil obligation.

Note: when the receiver returned the thing paid by the debtor, it is deemed that he waived the natural
obligation.

Examples of natural obligations:

a. Payment of an obligation which has already prescribed – Art. 1424, NCC. When a right to sue upon civil
obligation has lapsed by extinctive prescription, the obligor who voluntarily performs the contract cannot
recover what he has delivered or the value of the services he has rendered.

Notes:

-The obligor knew the obligation has prescribed.

-The payment was voluntary and not by mistake.

-Hence, no solution indebiti.

b. reimbursement to third payer – Art. 1425, NCC. When without the knowledge of against the will of the
debtor, a third person pays a debt which the obligor is not legally bound to pay because the action thereon
has prescribed, but the debtor later voluntarily reimburses the third person, the obligor cannot recover
what he has paid.

Notes:

- The obligor knew the obligation has prescribed.

-The obligor did not ask or compel the third person to pay on his behalf.

-The obligor still reimbursed the third person.

Note: the third person can recover the amount to the creditor by solution indebiti.

c. Voluntary performance after dismissal of action – Art. 1428, NCC. When after an action to enforce a civil
obligation has failed, the defendant voluntarily performs the obligation, he cannot demand the return of
what he has delivered or the payment of the value of the service which he has rendered.

Notes:

-The action to enforce the obligation was dismissed.

-The obligor is aware of the dismissal.

-The obligor voluntarily paid the obligation despite the dismissal of the action.

d. Excess payment by heir – Art. 1429, NCC. When a testate or intestate heir voluntarily pays a debt of the
decedent exceeding the value of the property which he received by will or by the law of intestacy from the
estate of the deceased, the payment is valid and cannot be rescinded by the payer.
 Notes:

-The estate is insufficient to pay the creditors of the decedent.

-The heir voluntarily paid the obligation’s with his own money or property.

e. Giving effect to legacy in a void will – Art. 1430, NCC.

When a will is declared void because it has not been executed in accordance with the formalities required
by law, but one of the intestate heirs, after the settlement of the debts of the deceased, pays a legacy in
compliance with a clause in the defective will, the payment is effective and irrevocable.

Notes:

-The will was not probated because it is extrinsically void.

-The interest heirs still voluntarily delivered the legacy (personal property) provided in the will to its
recipient.

SPECIAL CONTRACTS

I. Sales

A. Definition and Essential Requisites - Art. 1458, NCC: Contract of sale – one of the contracting parties
obligates himself to transfer the ownership and to deliver a determinate thing, and the other to pay therefore a
price certain in money or its equivalent.

Art. 1318, NCC - Essential requisites:

1. Consent of the contracting parties

2. Object certain which is the subject matter of the contract
3. Cause of the obligation which is established.

Consent:

a. There must be a meeting of the minds over the subject matter and the price
b. The meeting of minds takes place when there is a concurrence of the offer and acceptance
c. If there are conditions or accidental stipulations, these must also be agreed upon by the parties pursuant
to the consensuality of contracts.

Art. 1475, NCC - Being a consensual contract, the contract of sale is perfected at the moment there is a
meeting of the minds upon the thing which is the object of the contract and upon the price.

Consent of contracting parties – consent refers to seller’s consent to transfer ownership of, and deliver, a
determinate thing, and to buyer’s consent to pay the price certain.

Being a consensual contract, the contract of sale is perfected at the moment there is a “meeting of the
minds” upon the thing which is the object of the contract and upon the price.

Special case – if the sale involves the conjugal property of spouses, consent must be given by both.

Can there be sales without consent?

a. Expropriation – Art. 1488, NCC

b. Ordinary execution sale – Rule 39, Sec. 15, ROC.
c. Judicial foreclosure sale – Rule 68, ROC.
d. Extrajudicial foreclosure – Act 3135, as amended.

Subject matter: Art. 1459 - Object certain which is the subject matter of the contract – the thing must be licit
and the vendor must have a right to transfer the ownership thereof at the time it is delivered.

Art. 1459 – 1465 – Requisites of a valid subject matter:

1. Determinate/determinable at least
2. licit and withing the commerce of man (Legal)
3. Nemo dat quod non habet – the seller must have the right to transfer the ownership thereof. The
requirement need be present only at the time of delivery.
4. It must be existing or have potential existence. It can also have potential existence. It can even be

Marcelo v. Marcos, 1961 – the SC held that the subsequent acquisition by the mortgagor of title to the
property through a free patent does not validate the mortgage because the public land act prohibits the
 use of the land for the satisfaction of debts within 5 years from the issuance of the patent. (rules on patent
already repealed – this case is no longer applicable)

a. Licit

 Within the commerce of man

 When right is not intransmissible (Art. 1347, NCC)
 It does not contemplate a future inheritance unless expressly authorized by law.

Examples of Illicit things per se (of its nature) and per accidens (due to provisions of law)

1. Sale of animals if the use or service for which they are acquired has been stated in the contract,
and they are found to be unfit therefor (art. 1575, NCC)

2. Sale of animals suffering from contagious diseases (Art. 1575, NCC)

3. Sale of future inheritance is void (Art. 1347, NCC)

4. Sale of land in violation of constitutional prohibition against the transfer of lands to aliens (Art.
XII of the Constitution)

b. Existing, future, contingent

 Existing goods owned or possessed by the seller.

 Goods to be manufactured, raised or acquired by the seller – future goods (Art. 1462, NCC)
 Things having potential existence may be the object of a contract of sale. (Art. 1461, NCC)

Sibal v. Valdez, 1927 – a sale may be made of a thing which, though not yet actually in existence is
reasonably certain to come into existence as the natural increment or usual incident of something
in existence already belonging to the seller, and the title will vest in the buyer the moment the
thing comes into existence.

c. Determinate or determinable

Effect of the loss of the thing: Res perit domino – thing perishes with the owner. (determine who was the
owner of the thing during the loss)

A thing is considered lost when it:

a. Perishes
b. Goes out of commerce
c. Disappears in such a way that its existence is unknown or cannot be recovered.

XPN: in an obligation to deliver a generic thing, the loss or destruction of anything of the same kind does
not extinguish the obligation.

Prior to Seller has the risk of loss

delivery
a. Thing is lost before the perfection of contract (no cause/consideration)
b. Thing is lost after the perfection but before delivery.

The good remain at the seller’s risk until the ownership therein is transferred to the buyer.

If the thing is lost after perfection but before delivery and the buyer has already paid the
purchasing price – the seller shall reimburse the buyer of the price paid by the latter (Res
perit domino)

After delivery GR: Buyer has the risk of loss. (the thing is lost after delivery)

When the ownership therein is transferred to the buyer, the goods are at the buyer’s risk
whether actual delivery has been made or not.

XPN: Art. 1504, NCC.

a. Where delivery of the goods has been made to the buyer or to a bailee for the buyer,
in pursuance of the contract and the ownership in the goods has been retained by
the seller merely to secure performance by the buyer of his obligations under the
contract, the goods are at the buyer’s risk from the time of such delivery.

b. Where the actual delivery has been delayed through the fault of either the buyer or
the seller the goods are at the risk of the party in default.

In cases where there is a courier, determine who was the party attorned with by the courier
 (Sino nag engage/arrange nung courier as agent)

If the buyer has not yet paid (COD – collect on delivery) -

Note also – fortuitous event.

Cause/Consideration – Price must be certain.

When is a price considered certain – all of these requires the meeting of the mind.

Art. 1473, NCC - When it is agreed upon by the parties.

Art. 1469, NCC – When it is in reference to another thing certain.

When the determination thereof is left to the judgment or specified person/persons.

Manner of payment: Toyota Show v. CA

 Failure of consideration vs. Lack of consideration

Failure of consideration Remedy of the seller:

Failure of the buyer to pay the purchasing 1. Demand specific performance

price agreed upon. 2. Rescission

Lack of consideration Remedy of the seller/buyer: An action to declare the

There is no agreement as to the price and
there is a simulation of the price.
contract null and void for incomplete elements (there being
want of element of consideration)
-made for purposes of making it appear that there is onerous
contract for transfer of ownership.

 Inadequacy vs. Simulation of price

Price is less than the value of the thing

Inadequacy
Contract is valid

XPN: parties intended it to be a donation

Simulation of price Contract is invalid

No payment was made.

 Earnest money vs. Option money

Earnest money -part of the purchase price and indicates a perfected contract of sale. Rent to own

Governed by the contract of sale between the parties

XPN: Fisrt optima v. Securitron – if there was no agreement of sale yet, the payment
will only be an option contract and not earnest money since earnest money arises only
when there is already a contract of sale between the parties.

Option money -consideration for an option contract which is a contract separate and Rent to buy
distinct from the contract of sale.

Option money is not part of the purchase price. It only indicates that the seller respects
the right of the buyer to sell the property.

Governed by the optio contract.

First optima v. Securitron, 2015 – RE: payment of earnest money does not always mean a
perfected contract of sale; the consent of the parties must be clearly established.

Parties to a contract of sale:

Vendor –

Vendee -
  Qualifications and capacity to give consent
 Relative incapacity of certain persons to enter into a contract of sale

B. Contract of Sale

Types of contract of sale

Absolute Art. 1458, NCC – obligation of the seller to transfer ownership (pure obligation) – transfer of
sale ownership upon delivery of the thing.

-Ownership is transferred upon delivery of the thing without any condition attached to the said
obligation.

A sale may still be an absolute sale even if it is paid by installment (it is an obligation with a
period, not a conditional sale. What makes it as conditional sale is the stipulation or agreement
on conditions affecting the transfer of ownership)

Conditional Art. 1458 - Ownership will be reserved until the happening of an event.
sale
a contract whereby the ownership is transferred only upon the happening of an event or
compliance with a condition. (Full payment of purchase price)

Conditional sale – governed by obligations and contracts thus once the condition is complied
with, the contract is converted to absolute sale which gives rise to the right of one party to
demand delivery or performance of the obligation. Once the condition is complied with, the party
now becomes the owner of the thing. (Automatic transfer of ownership)

Contract to Orsal v. CA – once the condition has been complied with (full payment of the price) it only gives
sell rise to the obligation of the seller to execute a deed of absolute sale. It only gives rise to the right
to demand the execution of deed of absolute sale (not automatic transfer of ownership)

Deed of absolute sale – necessary for purposes of transferring ownership and registration thereof
under the name of the buyer. Eg. – Rent to own.

1. Contract to Sell

2. Option Contract

3. Right of First Refusal - A privilege granted to a lessee or any other contract whereby possession is given to
another. Contractual in nature

Case title Nature of the right of first Does it required Remedy against disregard of the right
refusal a separate and of first refusal
distinct
consideration?

Not an offer nor an option

because only the object is
Ang Yu certain. If it is a mere Damages.
Asuncion v. CA, offer, no
1991 In an offer or option, the object consideration.
and the price are pre- The offer can be Reason: specific performance is not
determined. The right of first withdrawn proper because there is no perfected
refusal depends on the before contract yet.
intention of the grantor to sell acceptance
and to the terms to be firmed
up later.

Rescission of the fraudulent sale

Equitorial The stipulation is part and
realty vs. parcel of the entire contract of
Mayfair theater, lease. The consideration for
1996 the lease includes the
consideration for the right of
first refusal.
(accion pauliana) Then, compel the
lessor-grantor to sell the property to
the lessee-grantee at the price when
the property was sold to the third
The person. Appreciation in value of the
consideration is property shall not be considered to
built into the prevent unjust enrichment.
reciprocal
obligations of
 the parties.

Rosencor v. Not a perfected contract of
Inquing, 2001 sale; but a contractual grant,
not of the sale of the property
but of the right of first refusal
over the property sought to be
sold.
No ruling on the Rescission not proper because the
matter third party buyer is a buyer in good
faith.
Rescission under Art. 1381 proper
only when the buyer is in bad faith.
So, the remedy is an action for
damages against the seller-grantor of
the right.

Tanay A right of first refusal means The Rescind the sale then offer the
recreation identity of terms and consideration for property to the grantee. However, the
center vs. conditions to be offered to the the lease offer to be made should be under
Fausto, 2005 lessee and all other prospective includes the reasonable terms and conditions,
buyers. consideration for taking into account the fair market
the right of first value of the property at the time it
refusal and is was sold to the buyer.
built into the
reciprocal
obligations of
the parties.

C. Earnest Money

D. Double Sales

E. Risk of Loss

Prior to Seller has the risk of loss

delivery
1. Thing is lost before the perfection of contract (no cause/consideration)
2. Thing is lost after the perfection but before delivery.

The good remain at the seller’s risk until the ownership therein is transferred to the buyer.

If the thing is lost after perfection but before delivery and the buyer has already paid the
purchasing price – the seller shall reimburse the buyer of the price paid by the latter (Res
perit domino)

After GR: Buyer has the risk of loss. (the thing is lost after delivery)
delivery
When the ownership therein is transferred to the buyer, the goods are at the buyer’s risk
whether actual delivery has been made or not.

XPN: Art. 1504, NCC.

c. Where delivery of the goods has been made to the buyer or to a bailee for the buyer,
in pursuance of the contract and the ownership in the goods has been retained by
the seller merely to secure performance by the buyer of his obligations under the
contract, the goods are at the buyer’s risk from the time of such delivery.

d. Where the actual delivery has been delayed through the fault of either the buyer or
the seller the goods are at the risk of the party in default.

In cases where there is a courier, determine who was the party attorned with by the courier
(Sino nag engage/arrange nung courier as agent)

If the buyer has not yet paid (COD – collect on delivery) – (Note also – fortuitous event.)

Performance of the contract

Obligations of the vendor (memorize if u can)

a. To transfer ownership Obligations which cannot waived by the vendee but they may modify the
period of transferring the ownership

(E.g. – Delivery after the payment of full purchase price)

b. To deliver the thing, its Obligations which cannot waived by the vendee – accession follows the
 fruits, accessions and principal.
accessories (Art. 1164
ad 1166, NCC)
c. To warrant against Obligations which can be modified or waived by the vendee
eviction and against
hidden defects. (Buyer assumes all the risk – caveat emptor)

d. To take care of the Obligations which can be modified or waived by the vendee (But not lesser
thing pending delivery than simple diligence)
(Art. 1163, NCC)
Can stipulate more than the diligence of a good father.

e. To pay for the expenses Obligations which can be modified or waived by the vendee XPN – capital tax
of the contract. gain shall be paid by the seller (but the parties may stipulate that the money
to be paid be from the buyer)

f. Execution of a public Obligations which can be modified or waived by the vendee (that the buyer
instrument under Art. be the one to execute the deed)
1358, NCC.

Warranties – Art. 1546, NCC.

 Art. 1546, NCC – Express warranty: Express warranty is any affirmation of fact or any promise by the
seller relating to the thing if the natural tendency of such affirmation or promise is to induce the buyer to
purchase the same, and if the buyer purchases the thing relying thereon.

 Implied warranty – Art. 1548, 1566, NCC.: Implied warranty is inherent in a contract of sale. It is
presumed to exist although nothing has been mentioned about it.

Implied warranty may be modified or suppressed by agreement of the parties.

Rationale: to protect the buyer who has no participation in the manufacture of the thing and who may not
have sufficient notice of the title of the seller.

Although the law requires the buyer to exercise due diligence in buying a thing, the buyer can only do so
much thus the law affords protection to him.

Implied warranties do not apply when:

a. When it is modified by the parties

b. When they are suppressed by the parties
c. When by the nature of the sale, implied warranties do not apply.

E.g.

1. Sale of 2nd hand articles

2. Merchant sale and public sale – no warranty against eviction and hidden defects.

3. Forced sales – execution sales, foreclosure sale – no warranty against eviction or legal hidden defects
against persons conducting the sale (Sheriff, judge) – remedy of the buyer is against the owner of the
thing.

Implied warranties in sales

1. Implied Requisites:
warranty
against a. The vendee is deprived in whole or in part of the thing purchased – Art. 1557,
eviction NCC.
b. He is so deprived by virtue of a final judgment – Art. 1157, NCC.
c. The vendor (seller – necessary party) was summoned in the suit for eviction at
the instance of the vendee (buyer – indispensable party) – Art. 1158, NCC.

Note: Escaler v. CA, 1985: the vendor should be made parties to the suit at the
instance of vendees, either by way of asking that the former be made a co-
defendant or by the filing of a third party complaint against the said vendor.

d. There is no waiver on the part of the vendee – Art. 1554, NCC.

e. The vendee is in good faith – Tuason v. CA, 1979.

If the vendee was aware of the right of other person, he is in bad faith thus
 cannot avail warranty against eviction.

Nota bene: Concept of good faith is not limited to absence of knowledge but also
by lack of knowledge which could have been discovered by exercising due
diligence.

Note: Nemo dat quod nan habet – If the seller is not the owner, the sale is void.

Remedies when seller has no title:

a. Rescission of contract/ action to declare the contract void – Restitution or

returning of payment with damages.

b. Warranty against eviction – return of the value of the thing at the time of
eviction.

Beneficial to the buyer since the value of real property appreciates over the
course of time. Buyer is also entitled to the payment of damages and interest

2. Implied Requisites:
warranty
against hidden 1. Art. 1561, NCC – the defect must be:
defects
a. such that it renders the thing unfit for the use for which it is intended, or it
diminishes its fitness for such use to such an extent that, had the vendee been
aware thereof, he would not have acquired it or would have given a lower price
for it.

b. hidden or cannot be discovered by ordinary inspection or examination. (if the

buyer is given the chance to inspect the thing, he can no longer avail the remedy
of warranties)

NOTE: Consumer act of PH – 7 day replacement when there is defect – matter of

fact.

2. The defect must be present at the time of the execution of the sale.

3. The vendee has not waived the warranty – Art. 1566, NCC.

Prescriptive period for rescission or reduction of the price:

a. 6 months from delivery

b. 40 days (in case of animals) from delivery.

Note: in case of consumers act of PH, prescriptive period is 1 year.

PH Lemon law – 1 year.

(Mention only special laws when it is mentioned in the facts)

3. Implied
warranty of A. Warranty that the goods are suitable for the particular or special purpose
fitness or disclosed by the buyer which will not be satisfied by the mere fitness of the goods
merchantabilit for general purposes.
y
B. Warranty that the goods purchased are reasonably for the general purposes for
which they are sold.

Note: The thing must have commercial value.

Obligations of the vendee (memorize if u can)

a. To pay Requirements as to integrity and identity of payment:

the price
The price will owe interest (from the time of delivery until payment of the price)

 If it is so stipulated
 If the thing sold or delivered produce fruits or income.
 If the buyer is in default, to be continued from the time of demand.

Grounds for suspension of payment of the price:

a. If the buyer is disturbed in the possession or ownership of the thing acquired; or

 b. If he has reasonable grounds to fear such disturbance by a vindicatory action or a
foreclosure of mortgage.

(included or implied in this two grounds is the act of self-preservation such as when the
seller is not yet the owner of the object of the contract. Thus, the buyer may suspend
the payment of the price and even not pay the balance if the seller cannot deliver the
property because there is a danger that the buyer will not be the owner of the
property.)

b. To
accept a. Buyer has the right to a reasonable opportunity to examine the thing.
delivery
b. Acceptance is deemed made after buyer has made an examination.

Application in shoppee/Lazada: When the buyer clicks the “order received” button, it is
deemed that he already accepts the delivery after making examination of the thing. He
nows bear the risk of loss.

If the thing is in conformity with the contract (the object agreed upon was delivered) the
buyer shall accept it.

If the thing delivered is not in conformity of what has been agreed upon – the buyer may
not accept the thing delivered and the seller has the liability of delivering the thing agreed
upon.

Consumers act – 7 days return policy. Warranties – right to replacement within 1 year
(implied and incorporated with all contracts of sale)

Art. 1306, NCC – although the parties are free to stipulate the provisions and terms of
contract, it must not be contrary to law, public morals etc. therefore, if there is a stipulation
providing that the warranty will only be for 2 months, the same is invalid for being contrary
to law ie. Consumers act of the PH.

Delivery – the operative act which transfers the ownership to the buyer.

The ownership of the thing sold shall be transferred to the vendee upon the actual or
constructive delivery thereof – Art. 1477, NCC.

The thing is delivered when it is placed in the control and possession of the vendee –
Art. 1497, NCC.

Modes of delivery:

a. Actual – physical delivery of corporeal things (real/personal property)

b. Constructive or legal – incorporeal (stocks, credits, bonds, etc)
c. Any other manner (Art. 1496, NCC)

Constructive delivery according to type of property:

Note: for constructive delivery to constitute delivery, the parties must agree that such act will
cause the transfer of ownership and that the buyer can exercise the rights of an owner.

 Real property

a. Execution of public instrument (notarized deed of conveyance)

b. Traditio constitutum possessorium (seller was in prior possession as an owner but

becomes a lessee or bailee of the property)
 Personal property

a. Execution of public instrument

b. Symbolic delivery – seller delivers to the buyer a token or representation of the

thing (keys to the car)

c. Tradition longa manu – pointing to a thing (that the thing is in the warehouse.
There must be consent or meeting of the mind that there is transfer of ownership.
E.g – the seller told the buyer that the property may be picked up in the
warehouse)

d. Tradition brevi manu – opposite of tradition constittum possessorium: the buyer

was a lessee/bailee of the property before the sale or transfer of ownership.

c. Traditio constitum possessorium - (seller was in prior possession as an owner but

 becomes a lessee or bailee of the property)

 Incorporeal properties

a. Execution of public instrument

b. Placing of titles of ownership in the possession of the vendee.
c. Exercise by the vendee of his rights with the vendor’s consent.

Note: they must first comply with the rules where the stock was bought.

Nota bene: by agreement, the delivery may not result in the transfer of ownership

The parties may stipulate that ownership in the thing shall not pass to the purchaser
until he has fully paid the price – Art. 1478, NCC.

Ten forty realty v. Cruz, 2003 – constructive delivery is merely presumptive.

The execution of a public instrument gives rise only to a prima facie presumption of
delivery. Such presumption is destroyed when the delivery is not effected, because of
legal impediment.

Such constructive or symbolic delivery, being merely presumptive, is deemed negated

by the failure of the vendee to take actual possession of the land sold.

F. Breach of Contract of Sale

Remedies in case of failure of the contract:

Action for specific

performance
In case the seller failed to
deliver the thing – the buyer
may file an action for:
Rescission In sale of real property:

a. Absolute sale – apply Art. 1191 and 1592, NCC.

a. Specific performance
Art. 1191, NCC - return what he has received
b. Rescission
Art. 1592, NCC – Right of pre-emption.

Sps. Garcia v. CA, 2010

b. Sale on installment/contract to sell – apply RA

6552 (maceda law)

In sale of personal property – Art. 1593, NCC.

a. The fendee, upon the expiration of the period

fixed for the delivery of the thing purchased,
refused to receive it without justifiable cause.

b. Buyer failed to pay the price, unless granted a

longer period within which to pay.

Action for damages Art. 1596, 1599, NCC

a. Where the buyer wrongfully neglects or refuses

to accept and pay for the goods.

When there is breach of warranty by the seller.

Action for specific

performance
In case the buyer failed to
deliver the thing – the seller
may file an action for: In sale of real property:

Rescission a. Absolute sale – apply Art. 1191 and 1592, NCC.

a. Specific performance Art. 1191, NCC - return what he has received

b. Rescission Art. 1592, NCC – Right of pre-emption by the

 seller (the seller may still pay the price of the
thing thus the rescission will not prosper)

Sps. Garcia v. CA, 2010

b. Sale on installment/contract to sell – apply RA

6552 (maceda law)

Note: RA 6552 is not applicable to industrial or

commercial property and depends as to the
type of the sale.

Note: Sps. Sebastian v. BPI – not applicable

ang RA 6552.

In sale of personal property – Art. 1593, NCC.

a. The vendee, upon the expiration of the period

fixed for the delivery of the thing purchased,
refused to receive it without justifiable cause.

b. Buyer failed to pay the price, unless granted a

longer period within which to pay.

Note: in case of personal property on installment –

Apply Art. 1484, NCC (Recto law)

Action for damages Art. 1596, 1599, NCC

b. Where the buyer wrongfully neglects or refuses

to accept and pay for the goods.

c. When there is breach of warranty by the seller.

1. Recto Law
Alternative remedies (xpns also take note)

2. Maceda Law

Not automatically applied – it must be invoked by the parties.

Olivares v. Castillo.

Sps. Godinez v. Norman, 2020.

G. Extinguishment of the Sale

 In general, a sale is extinguished by the same causes as all other obligations – Art. 1600, 1231, NCC.

a. Payment
b. Loss of the thing due
c. Remission/condonation
d. Merger/confusion
e. Compensation
f. Novation
g. Prescription
h. Annulment
i. Rescission
j. Resolutory condition fulfilled
k. Redemption (conventional or legal)

1. Conventional Redemption (Pacto De Retro Sale)

 Definition: Art. 1601, NCC – exists when the vendor reserves the right to repurchase the thing sold, with
the obligation to comply with the provisions of Art. 1616 and other stipulations which may have been
agreed upon.

a. Return the price of the sale.

b. Any other legitimate payments by reason of the sale.
c. Necessary and useful expenses.
 Note: Redemption feature does not prevent the full consummation of the contract of sale. Available
when the seller reserves the right to repurchase the thing sold in the same instrument of sale as one of
the stipulations of the contract – Villarica v. CA, 1968.

Note: this is a resolutory condition where the obligation is extinguished upon the happening of the
condition (the return of the price of sale -buy back the property)

 Period: Art 1606, NCC

GR: Follow period stipulated in contract, but should not exceed 10 years, otherwise, automatically
reduced.

XPN:

a. In the absence of stipulation, the right must be exercised within 4 years from the date of contract.

b. If no period is stipulated but the parties intended aa period, then it shall be 10 years from the date of
the contract.

c. But vendor may still exercise the right to repurchase within 30 days from the time the final judgment
was rendered in a civil action on the basis that the contract was a true sale with right to repurchase.

 By whom exercised

a. Vendor, after returning to vendee price of sale plus expenses of the contract, other legitimate
payments made by reason of sale, and necessary and useful expenses made on the thing sold.

b. His heirs, assigns or agents.

c. Creditor, after he has exhausted the property of the vendor – Art. 1610, NCC.

d. Co-owners of an immovable, if they sold their interests to the same person, may only redeem their
respective shares – Art. 1612, NCC.

Note: Vendee cannot be compelled to agree to a partial redemption and can compel all sellers to
redeem the entire property or for only one of them to redeem it – Art. 1613, NCC.

 From whom to redeem

a. Vendee a retro

b. His heirs, assigns or agents

c. Subsequent purchaser of property, even if the right to redeem was not mentioned in the subsequent
contract

XPN: if registered land, where the right to redeem must be annotated on the title.

d. If several heirs, then the right of redemption can be exercised against each heirs for his share of the
property – Art. 1615, NCC.

 How exercised

a. By returning the following to the buyer:

1. Price of the Sale (XPN: If the parties agreed on a redemption price)

2. Expenses of the contract and other legitimate payments made by reason of the sale.
3. Necessary and useful expenses made on the thing sold.

b. Complying with any other stipulation agreed upon, if any.

 Effect of redemption

a. The sale is extinguished.

b. The seller shall receive the thing free from all charges or mortgages constituted by the buyer BUT he
shall respect leases executed by the buyer in good faith and in accordance with local custom.
 c. As to fruits:

1. If the parties agreed on a distribution,

the fruits shall be distributed according
to their agreement.
2. If the parties did not agree on a
distribution:
1. Buyer receives reimbursement if the buyer paid
a. If there are growing fruits at the indemnity at the time of sale.
time of sale and at the time of
redemption: 2. Buyer receives no reimbursement or prorating if the
buyer did not pay indemnity at the time of sale.

b. If there were no growing fruits at Fruits pro-rated – buyer entitled to part corresponding to
the time of sale, but some exist at time he possessed the land in the last year, counted from the
the time of redemption: anniversary of the date of sale.

 Effect of non-redemption

Art. 1607, NCC – Ownership is consolidated in the buyer BUT the consolidation shall not be recorded in
the registry of property without judicial order, after the vendor has been duly heard.

 Right to redeem v. Option to purchase

3. Legal Redemption

Art. 1619, NCC – The right to be subrogated, upon the same terms and conditions stipulated in the contract, in
the place of one who acquires a thing by purchase or dation in payment, or by any other transaction whereby
ownership is transmitted by onerous title.

GR: Notice is required.

Art. 1623, NCC - Statute of limitation. The right of legal redemption shall not be exercised except within
30 days from the notice in writing by the prospective vendor, or by the vendor, as the case may be.

Thus, right of legal redemption may still be exercised as long as there is no notice served upon the
redemptioner.

XPN: Where the redemptioner is aware or of knowledge of the actual sale, notice is no longer required.

Note: Sps. Sy v. CA, 2000 - Co-owners with actual knowledge or actual notice of sale are not entitled to
written notice. A written notice of a fact already known to them would be superfluous.

Types of legal redemption - memorize

a. Legal redemption by a co-owner

b. Legal redemption by adjacent owners of rural

lands.

c. Pre-emption and legal redemption by

adjacent owners of urban lands

H. Equitable Mortgage

 Art. 1602, NCC - When a sale with right of repurchase is presumed to be an equitable mortgage when:

a. When the price of a sale with right to repurchase is unusually inadequate.

b. When the vendor remains in possession as a lessee or otherwise.

c. 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.

d. 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.
 e. When the purchaser retains for himself a part of the purchase price.

f. When the vendor binds himself to pay the taxes on the thing sold.

 Rockville v. Sps. Miranda, 2009 - Equitable mortgage: it is one which, although lacking in some formality,
or form or words, or other requisites demanded by a statute, nevertheless reveals the intention of the
parties to charge real property as security for a debt, there being no impossibility nor anything contrary to
law in this intent.

 Remedy of the creditor/buyer:

Only after the breach – the creditor may proceed against the property. To allow respondents to
appropriate the subject lot without prior foreclosure would produce the same effect as a pactum
commissorium (where the creditor appropriates the thing given as security, for the payment of the
monetary obligation – prohibited by law). Thus, the creditor must first foreclose the property. The
creditor can only transfer the title of ownership to his name only when there is no higher bidder than him.

They are entitled to collect the outstanding amount of petitioner’s loan, plus interest, and to foreclose on
the subject property should the latter fail to pay the same.

Upon full satisfaction of the debt, the mortgage, being a security contract, shall be extinguished and the
property should be returned to herein petitioners.

 Remedy of the debtor/seller:

Reformation of contract – the debtor may, before any default or breach on his part, file an action for
reformation of contract: from sale with a right to repurchase to a deed of real estate mortgage.

If the creditor failed to comply with the foreclosure proceeding requirement and appropriated the thing to
himself, the debtor may avail of the remedy and file an action for recovery of possession. If the title has
already been transferred to the name of the creditor, he may file an action for deed of reconveyance but he
must prove that the contract between them is an equitable mortgage and not a contract of sale with right
to repurchase.

I. Pacto de Retro Sales

Selected Supreme Court Decisions related to Sales

a. Sps Re: Inapplicability of RA 6552, the Maceda law, to housing loans.

Sebastian v.
BPI, 2014
b. Ventura v. Re: Conditions in a contract to sell, including those unrelated to the purchase price,
Andaya, to be fulfilled first before the execution of de ed of sale.
2013
c. Cabrera v. Re: Unless all the co-owners have agreed to partition their property, none of them
Isaac, 2014 may sell a definite portion of the land. The co-owner may only sell his/her
proportionate interest in the co-ownership. A contract of sale which purports to sell
a specific or definite portion of unpartitioned land is null and void.

d. Sps. Roque RE: Rules on double sales do not apply when pone of the purported sales is a
v. Aguada, contract to sell. Contracts must be compatible to each other (such that there is
2014 transfer of ownership over the same thing). Buyer in deed of sale will prevail. The
remedy of the buyer in contract to sell is to demand damages from the seller (abuse
of right – art. 19 and 1170, NCC)

e. Recio v. Re: requirement under Art. 1874 and 1878 that there must be a written authority to
Altamirano, sell an immovable property is mandatory; otherwise the sale is void.
2013
Contract of agency – In an agency to sell, the agent must be authorized in writing. If
the sale is consummated but the agent is not authorized in writing, the contract of
sale is void and cannot be ratified.

f. Ace food v. Re: Absolute nature of a contract of sale is not changed and converted to a contract
Micro to sell even if the invoice indicates “reservation of ownership” until full payment. A
Pacific, clear novation should be established.
2013
This is not a contract to sell but a contract of sale.

g. First Re: Payment of earnest money does not always mean a perfected contract of sale.
optima The consent of the parties must be clearly established.
realty v.
Securitron,
 2015
h. Sps Noynay Re: Assignment by the developer of its rights and obligations under the contract to
v. sell to a bank makes the former a stranger to the contract and deprives it of a cause
Citihomes, of action to eject a buyer who is now a borrower of the bank.
2014
i. Geromo v. Re: In addition to the implied warranty against hidden defects, a real estate
La Paz developer may answer for damages on the ground of negligence. (It does not
Housing, disclose the law on torts just because there is pre-contractual relation) – seller was
2017 negligent in constructing a house without considering the nature of the land where
such house will be erected which is near the river.

GR: 6 months from delivery – prescription.

XPN: the defect could not have been discovered at the time of delivery and within 6
months.

j. PH Steel Re: Refusal to pay the balance of the purchase price is justified in case of the seller’s
coating v. breach of warranty.
Quinones,
2017
II. Lease

A. Kinds of Lease

 Lease of things – in the lease of things, one of the parties bind himself to give to another the enjoyment or
use of a thing for a price certain, and for a period which may be definite or indefinite. However, no lease
for more than 99 years shall be valid – Art. 1643, NCC.

Note:

a. The lessor transfers merely the temporary use and enjoyment of the thing leased – Reyes v. CA, 1999.

b. The lessor’s right of use is impaired. He may even be ejected by the lessee if the lessor uses the leased
realty – Roxas v. CA, 1991.

c. Being a consensual contract, a lease is perfected at the moment there is a meeting of the minds upon
the thing and the cause or consideration which are to constitute the contract – Bugatti v. CA, 2000.

Being a consensual contract, delivery of the thing is not an essential element of lease. However, if the
lessor failed to deliver the thing to the lessee on the date stipulated, the latter may file an action for
specific performance or he may rescind the contract.

 Lease of services – In the lease of work or service, one of the parties binds himself to execute a piece of
work or to render to the other some service for a price certain, but the relation of principal and agent does
not exist between them – Art. 1644, NCC.

Agency v. Lease of service: Nielson v. Lepanto, 1968 – In both agency and lease of services, one of the
parties bind himself to render some service to the other party. Agency, however, is distinguished from
lease of work or services in that the basis of agency is representation, while in the lease of work or services
the basis is employment. The lessor of services does not represent his employer, while the agent
represents his principal.

Employment v. Lease of work: Investment planning v. SSS, 1967 – the work of a lessor of work or service
is more nearly approximates that of an independent contractor than that of an employee. The latter is
paid for the labor he performs, that is, for the acts of which such labor consists; the former is paid for the
result thereof.
B. Rights and Obligations of Lessor

Obligations of the lessor

a. To deliver the thing in such a condition

as to render it fit for the use intended.
b. To make all necessary repairs on the
thing.
c. To maintain the lessee in peaceful and
adequate enjoyment of the lease for the
entire duration of the contract.
d. To warrant the thing against hidden
defects.

C. Rights and Obligations of Lessee

Obligations of the lessee

 a. To pay rent

b. To use thing leased as a diligent father

of a family, devoting it to the use
stipulated.
c. To pay expenses for the deed of lease.

d. To notify the lessor of usurpation or

untoward acts.
e. To notify the lessor of need for
repairs.
f. To return the property leased upon
termination of the lease.

 Term of the lease if no period was agreed upon; Art. 1687, NCC – It shall be understood to be from year to
year, if the rent agreed upon is annual, from month to month, if it is monthly, from week to week, if the
rent is weekly, and from day to day, if the rent is to be paid daily.

Arquelada v. PVB, 2000 – Payment of the stipulated rents were made on a monthly basis and, as such, the
period of lease is considered to be from month to month in accordance with Art. 1687 of NCC. Moreover, a
lease from month to month is considered to be one with a definite period which expires at the end of each
month upon a demand to vacate by the lessor.

 When a lessee may suspend payment of rent:

Grounds for suspension of payment of rent – Art. 1658, NCC.

a. In case the lessor fails to make the necessary repairs; or

b. When the lessor fails to maintain the lessee in peaceful and adequate enjoyment of the property
leased.

 Rescission of the lease: Grounds for rescission:

a. Art. 1659, NCC – if the lessee should not comply with his obligations.
b. Art. 1660, NCC – if a dwelling place or any other building intended for human habitation is in such a
condition that its use brings imminent and serious danger to life or health.
c. Art. 1662, NCC – When the repair works shall render the portion which the lessee and his family need
for their dwelling uninhabitable and the main purpose of the lease is to provide a dwelling place for
the lessee.

 Grounds to evict the lessee: action to be filed – unlawful detainer.

a. When the period agreed upon, or that which is fixed for the duration of leases under Art. 1682 and
1687 has expired.
b. Lack of payment of the price stipulated.
c. Violation of any of the conditions agreed upon in the contract.
d. When the lessee devotes the thing leased to any use or service not stipulated which causes the
deterioration thereof; or if he does not observe the requirements in No. 2 of Art. 1657, as regards the
use thereof – Art. 1673, NCC.

Additional grounds to evict the lessee under RA 9653 (Rent control law)

a. Assignment of lease or subleasing of residential units in whole or in part without the written consent
of the owner/lessor.
b. Arrears in payment of rent for a total of 3 months.
c. Legitimate need of the owner/lessor to repossess his property for his own use or for the use of an
immediate member of his family as a residential unit.
d. Need of the lessor to make necessary repairs of the leased premises which is the subject of an existing
order of condemnation by appropriate authorities concerned in order to make the said premises safe
and habitable.
e. Expiration of the period of the lease contract.

Rent Control Law – RA 9653.

a. Applies to all residential units in the NCR and other highly urbanized cities, the total monthly rent for
each of which ranges from P1.00 – P10,000 and all other residential units in all other areas, the total
monthly rent for each which ranges from P1.00- P5,000.
 b. It imposes a limit on increases in rent. Under the national human settlements board resolution, the
rent control is extended until Dec. 31, 2022. Thus, the rent of any residential unit shall not be
increased.

 Extrajudicial repossession – Viray v. IAC, 1991. Irao v. By the Bay Inc., 2008:

A stipulation in the written contract of lease which authorizes repossession of the premises without court
action is valid.

It is in the nature of a resolutory condition, for upon the exercise by the lessor of his right to take
possession of the leased property, the contract is deemed terminated, and that such a contractual
provision is not illegal, there being nothing in the law prescribing such kind of agreement.

XPN: Violation of Art. 19, NCC.

 Rules on improvements – Art. 1678, NCC.

Under Art. 1678, if the lessee makes, in good faith, useful improvements which are suitable to the use for
which the lease is intended, without altering the property leased: (note: it must be with the consent or
permission of the owner. Otherwise, the lessee is in bad faith)

a. The lessor may pay the lessee ½ of the value of improvements. Or

b. The lessee may remove the improvements, without causing any more impairment upon the property.

With regard to ornamental expenses, the lessee shall not be entitled to reimbursement but he may remove
the ornamental objects, provided no damage is caused to the property and the lessor does not choose to
retain them by paying the price.

Note: Art. 1678, NCC gives the lessor and not the lessee the option provided therein.

The concept of possessor in good faith for purposes of entitling a possessor to reimbursement for
improvements made by him on the property possessed does not apply to a lessee’s right regarding such
improvements because as such he knows that he is not the owner of the leased property.

Cabangis v. CA, 1991 – Failure on the part of the lessee to remove improvements at the time of the
expiration of the lease, there being no true accession, constitutes a waiver or abandonment of his right to
remove such improvements.

 Is a lessee a builder in good faith under art. 448 in relation to Art. 546? – Geminiano v. CA, 2020: Being
mere lessees, the respondents knew that their occupation of the premises would continue only for the life
of the lease. Plainly, they cannot be considered as possessors nor builders in good faith.

In plethora of cases, this court has held that Art. 448 of NCC, in relation to Art. 546 of the same code,
which allows full reimbursement of useful improvements and retention of the premises until
reimbursement is made, applies only to a possessor in good faith (one who believes that he is the owner
thereof). It does not apply where one’s only interest is that of a lessee under a rental contract. Otherwise,
it would always be in the power of the tenant to improve his landlord out of his property.

 Tacita Reconduccion – Art. 1670, NCC.

If at the end of the contract the lessee should continue to enjoy the thing leased for 15 days with the
acquiescence of the lessor, and unless a notice to the contrary by either party has previously been given, it
is understood that there is an implied new lease, with the following period:

a. In case of rural lands, for the time necessary for the gathering of the fruits.
b. In case of urban lands, it is understood to be year to year, month to month, week to week, or day
to day, depending on the rent paid or agreed upon.

Elements of tacita reconduccion:

1. The terms of the original contract has expired.

2. The lessor has not given the lessee a notice to vacate.

3. The lessee continued enjoying the thing leased for 15 days with the acquiescence of the lessor.

 Tacit renewal (tacita reconduccion) is not a contract without term entered into by the parties, but an
implied renewal of a previous contract.

 Manas v. Nicolasora, 2020:

The terms of the original contract which are revived in the implied new lease are only those terms which
are germane to the lessee’s right of continued enjoyment of the property leased.
 It does not ipso facto carry with it any implied revival of an option to purchase the leased premises. The
right to exercise the option to purchase expired with the termination of the original contract of lease.

III. Agency

 What is agency and what are its elements?

Definition – Art. 1868, NCC.

By a 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.

Elements:

a. The parties’ consent, express or implied, to establish the relationship.

b. The object, which is the execution of a juridical act in relation to a third person.
c. The representation, by which the one who acts as an agent does so, not for himself, but as a
representative.
d. The limitation that the agent acts within the scope of his or her authority.

Characteristics of agency:

a. Consensual – it is based on the agreement of the parties which is perfected by mere consent.
b. Principal – it can stand by itself without the need of another contract.
c. Nominate – it has its own name.
d. Unilateral – If it is gratuitous because it creates obligation for only of the parties. Or Bilateral if it
is for compensation because it gives rise to reciprocal rights and obligations.
e. Preparatory – It is entered into as a means to an end. (I.e. Creation of other transactions or
contracts)

 When may agency be presumed and when it cannot be presumed?

Under the doctrine of apparent authority or agency by estoppel – Professional Services Inc. V. Agana,
2007: (It is the principal who makes the representation)

The principal is bound by the acts of his agent with the apparent authority which he knowingly
permits the agent to assume, or which he holds the agent out to the public as possessing.

The question in every case is whether the principal has by his voluntary act placed the agent in
such a situation that a person of ordinary prudence, conversant with business usages and the
nature of the particular business, is justified in presuming that such agent has authority to
perform the particular act in question.

Sec. 21, Rule 138, ROC – Authority of attorney to appear.

Authority of an attorney to appear and represent his client during trial. However, it does not
apply during pre-trial.

Note: When is agency not presumed:

a. Tuazon v. Ramos, 2005 – The declaration of agents alone are generally insufficient to
establish the fact or extent of their authority. The law makes no presumption of agency;
proving its existence, nature and extent is incumbent upon the person alleging it.

b. Bautista-Spile v. Nicorp Management, 2015 – The well settled rule is that a person dealing
with an assumed agent is bound to ascertain not only the fact of agency but also the nature
and extent of the agent’s authority.

c. Art. 1902, NCC – A third person with whom the agent wishes to contract on behalf of the
principal may require the presentation of the power of attorney, or the instruction as regards
the agency.

Is there a required form for agency?

GR: No. contracts hall be obligatory, in whatever form they may have been entered into, provided
all the essential requisites for their validity are present – Art. 1356, NCC.

XPN:
 a. The power to administer property must be in a public instrument – Art. 1358, NCC.
b. The authority to sell land or any interest therein must be in writing – Art. 1874, NCC.
(May be in a private document. Does not require that it be in public instrument)

 What are the powers that may be exercised by the agent?

Agent can exercise both express and incidental powers – Citibank v. Chua, 1993: It is a fundamental
principle in the law of agency that every delegation of authority, whether general or special, carries with it,
unless the contrary be expressed, implied authority to do all those acts, naturally and ordinarily done in
such cases, which are reasonably necessary and proper to be done in order to carry into effect the main
authority conferred.

 What are the types of agency?

Express agency Implied agency

One where the agent has been expressly
authorized by the principal, either orally or in
writing.
Here, there is an express agreement between
the parties.
a. From the acts of the agent which carry out the
agency – Art. 1870, NCC.
b. From his silence or inaction according to the
circumstances (applicable only between persons
who are present)

c. If the principal deliver his power of attorney to the

agent and the latter receives it without any
objection – Art. 1871, NCC.

d. Between persons who are absent:

- When the principal transmits his power of

attorney to the agent, who receives it without any
objection.

-When the principal entrusts to him by letter or

telegram a power of attorney with respect to the
business in which he is habitually engaged as an
agent, and he did not reply to the letter or telegram
– Art. 1782, NCC.

Here, consent of parties is not obvious/does not

manifest.

Agency by operation of law:

a. When a person declines the agency and no new agent has been appointed (if he has in his
possession of the thing which is the object of the supposed agency, the supposed agent is with the
duty to take care of such thing until the principal appoints an agent)

b. Immediately after the agent withdraws from the agency (agent has to take care of the thing subject
of the agency and make accounting)

c. In case of extinguishment of the agency, without the knowledge of the agent. (Death of the
principal or dissolution of corp principal – contracts entered into by agents still binds the estate of
the principal)

d. In case of death of the agent (there is a limited agency relation between the heirs and the principal.
The heirs must take into custody the things subject of agency and must make an accounting)

 What are the consequences of the agency on the principal?

 What are general and special powers of attorney?

General powers of attorney Special powers of attorney

It gives an agent the ability to act on a person’s
behalf in all of his affairs.
Art. 1877, NCC – agency couched in general
terms comprises only acts of administration,
even if the principal should state that he
withholds no power or that the agent may
execute such acts as he may consider
appropriate, or even though the agency should
authorize a general and unlimited management.
United BF Homeowners v. Chairman of BF
Homes – 2006:
Acts of administration, as opposed to acts of
ownership, pertains solely to management or
superintendence. They do not necessarily pivot
on ownership.
It grants an agent authority only in specific situations.
(Acts of ownership)
A special power of attorney is required in the following
cases: Art. 1875
a. To make such payments as are not usually
considered as acts of administration. (only
those payments which affects the property of
principal ie. Increase/decrease of property.
XPN: if only for preservation of property, no
need for SPA.
b. To effect novations which put an end to
obligations already in existence at the time the
agency was constituted.
c. To compromise, to submit questions to
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.
d. To waive any obligation gratuitously.
e. To enter into a contract which the ownership of
an immovable is transmitted or acquired either
gratuitously or for a valuable consideration.
f. To make gifts, except customary ones for
charity or those made to employees in the
business managed by the agent.
g. To loan or borrow money, unless the latter act
be urgent and indispensable for the
preservation of the things which are under
administration.
h. To lease any real property to another person for
more than 1 year.
i. To bind the principal to render some service
without compensation.
j. To bind the principal in a contract of
partnership.
k. To obligate the principal as a guarantor or
surety.
l. To create or convey real rights over immovable
property.
m. To accept or repudiate an inheritance.
n. To ratify or recognize obligations contracted
before the agency.
o. Any other act of strict dominion.
Ozun v. Mercado, 2006 – The requirement of a special
power of attorney refers to the nature of the
authorization and not to its form.
If the special authority is not written, then it must be
duly established by evidence.
Thus, there may be a verbal conferment of special
authority as long as the parties may prove the same.
 What are the rights and obligations of the parties?
Rights of an agent
a. Right to be compensated – Art. 1875, NCC.
b. Right to appoint a substitute – Art. 1892,
NCC.
c. Right to be reimbursed the sums advanced
by him for the execution of the agency –
Art. 1912, NCC.
Rights of the Principal
a. Right of control over the agent – Art. 1887,
1888, NCC
b. Right to be paid damages, if there being
conflict between the interests of the
principal and those of agent, the agent
should prefer his own – Art. 1889, NCC
or if the agent is guilty of fraud or negligence
– Art. 1909, NCC.
c. Right to an accounting by the agent of his
transactions and to the delivery of whatever
the agent may have received by virtue of the
agency – Art. 1891, NCC.
Obligations of the Principal
1. To pay the agent his compensation, unless the
contrary was agreed upon – Art. 1875, NCC.
2. To comply with the obligations which the agent
may have contracted within the scope of his
authority, or those which the agent has done outside
the scope of his authority but which the principal
has ratified, or when the principal allowed the agent
to act as though he had full powers – Art. 1910,1911,
NCC.
3. To advance to, or reimburse the agent, the sums
necessary for the execution of the agency, or the
damages which the execution of the agency has
caused the agent, without fault or negligence on his
part – Art. 1912, 1913, NCC.
But the principal is not liable for the expenses
incurred by the agent in the following cases: (Art.
1918, NCC)
 if the agent acted in contravention of the
principal’s instruction, unless the latter
should wish to avail himself of the benefits
derived from the contract.
 When the expenses were due to the fault of
the agent.
 When the agent incurred them with
knowledge that an unfavorable result would
ensue, if the principal was not aware
thereof.
 When it was stipulated that the expenses
would be borne by the agent, or that the
latter would be allowed only a certain sum.
Obligations of the agent
1. To carry out the agency and finish the business –
Art. 1884, NCC.
2. To act in accordance with the instructions of the
principal – Art. 1887, NCC.
3. To advance necessary funds if such is stipulated
– Art. 1886, NCC.
4. To render an account of his transactions and to
deliver whatever he may have received by virtue of
the agency – Art. 1891, NCC. (violation may lead to
estafa)
5. To pay damages to the principal for his non-
performance and for engaging in conflict of interest
– Art. 1884, 1889, NCC.
6. To answer for his fraud and negligence – Art.
 1909, NCC. (by way of damages)

When is principal bound by act of agent:

a. The agent must act within the scope of his authority; and
b. The agent must be acting in behalf of the principal.

In addition:

 Doctrine of imputed knowledge – notice to the agent is notice to the principal.

 Ratification –
 Estoppel –

When is the principal not bound by the act of agent:

a. When the agent acts without or beyond the scope of his authority in the principal’s name.

b. When the agent acts within the scope of his authority but in his own name, except when the transaction
involves things belonging to the principal.

c. When the agent expressly binds himself.

d. When the agent exceeds his authority.

e. When an agent by his act prevents performance on the part of the principal.

f. When a person acts as an agent without the authority or without a principal.

g. A person who purports to act as agent of an incapacitated principal.

 How is agency extinguished?

a. By its revocation

b. By the withdrawal of the

agent

c. By the death, civil When death of principal does not terminate agency – Art.
interdiction, insanity or 1930, NCC.
insolvency of the
principal or of the agent.  If the agency has been constituted in the common
interest of the principal and the agent.

 If it has been constituted in the interest of a third

person who has accepted the stipulation in his favor.
d. By the dissolution of the
firm or corporation
which entrusted or
accepted the agency.

e. By the accomplishment
of the object or purpose
of the agency.

f. By the expiration of the

period for which the
agency was constituted.

Kinds of revocation:

a. Express

 Notice of revocation shall be given. The third person shall be notified.

b. Implied

 Art. 1923, NCC – When the principal appoints a new agent for the same business or transaction.
Or
  Art. 1924, NCC – When the principal directly manages the business entrusted to the agent.

 Art. 1926, NCC – When the principal after granting a general power of attorney to an agent,
grants a special one to another agent, there is implied revocation of the former as regards the
special matter involved in the latter.

Irrevocable agencies: NOTE IMPORTANT

a) If a bilateral contract depends upon it. (Mortgage – mortgagee needs SPA)

b) If it is the means of fulfilling an obligation already contracted. (Compensation) And

c) If a partner is appointed manager of a partnership in the contract of partnership and his removal
from management is unjustifiable.

Right of the agent to withdraw: Art. 1929, NCC.

a. With or without just cause.

b. He must continue to act until the principal has had reasonable opportunity to take the necessary
steps to meet the situation

IV. Credit Transactions

A. Loans

What is a loan? – Art. 1933, NCC: It is a contract whereby one of the parties delivers to another, either
something not consumable so that the latter may use the same for a certain time and return it, in which
case the contract is called a commodatum; or money or other consumable thing, upon the condition that
the same amount of the same kind and quality shall be paid, in which case the contract is simply called a
loan or mutuum. (Memorize)

Parties to a loan:

a. Bailor – the giver; the party who delivers possession/custody of the thing bailed; the lender.
b. Bailee – the recipient; the party who receives the possession/custody of the thing delivered,
the borrower.

A loan, whether commodatum or mutuum, is a real contract. It is perfected only from the time the object
of the contract is delivered – Art. 1934, NCC. (thus, proof of delivery and proof of acceptance is necessary)

Q: is an accepted promise to loan a thing actionable?

A: Yes. The accepted promise to deliver something by way of a future loan becomes a consensual
contract. Its non-fulfillment will justify the filing of an action for damages.

1. Kinds

Commodatum – one of the parties delivers to another, either something not consumable so that the latter may
use the same for a certain time and return it.

 It is gratuitous or without compensation – otherwise, the contract becomes a lease of things.

 Generally, bailee does not enjoy the fruits – otherwise, the contract is a usufruct. (XPN: A contrary
stipulation is valid – Art. 1940, NCC)
 The bailor lender need not be the owner – E.g. – A lessee of a thing may lend it to another.
 Commodatum is purely personal.

Effect:

o The death of either the bailor or the bailee extinguishes the contract.

o The bailee can neither lend nor lease the object of the contract to a third person.
However, the members of the bailee’s household may make use of the thing loaned,
unless there is a stipulation to the contrary, or unless the nature of the thing forbids such
use.

Obligations of Bailee Obligation of Bailor

a. To be liable for loss, even though if through a 1. To respect the right of the bailee to use the thing
fortuitous event when:
XPN: Bailee may demand the return of the thing if:
o He devotes the thing to any purpose
different from that which it has been o Expiration of the period stipulated.
loaned.
o Accomplishment of the use for which the
 o He keeps it longer than the period
stipulated or after the accomplishment of
the use for which the commodatum has
been construed.
o The thing loaned has been delivered with
appraisal of its value, UNLESS there is a
stipulation exempting the bailee from
responsibility in case of fortuitous event.
commodatum was constituted.
o If the bailor should have urgent need for the
thing, he may demand the return or temporary
use thereof.
o If the bailee committed an act of ingratitude.
(Bailee committing or attempting to commit a
crime against the bailor)

o He lends or leases the thing to a third o Precarium – a kind of commodatum where the
person who is not a member of his bailor may demand the thing at will.
household.

o Being able to save the thing borrowed or

his own thing, he chose to save the latter.
b. To pay ordinary expenses for the use and
preservation of the thing loaned.
2. To refund ordinary expenses incurred by the bailee.
(Correlate with Par. 1 of obligations of bailee below - To pay
ordinary expenses for the use and preservation of the thing
loaned)

Although the bailee shall pay the ordinary expenses,

such payment shall be reimbursed by the bailor.

c. To return the thing
GR: Bailee cannot retain the thing. (commodatum)
XPN: If there is damage by reason of hidden
defects or flaws of the thing.
3. To pay damages to the bailee for injury suffered by
reason of the flaws of hidden defects of the thing
loaned.
(This applies only when the bailor was aware of the
defects. In commodatum, there is no implied
warranty against hidden defects.)

(Correlate with Par. 4 – Obligation of the bailee to return

Failure to return – may give rise to estafa. the thing)

d. To take good care of the thing with the

diligence of a good father of a family.

Mutuum - one of the parties delivers to another money or other consumable thing, upon the condition that the
same amount of the same kind and quality shall be paid.

1. Ownership is transferred in mutuum:

 The purpose is consumption of the thing loaned.

 The obligation of the borrower is to pay (not return) the equivalent of the thing.
 A loan is a debt, not a trust.
 Sec. 20, Art. III of Consti – prohibits imprisonment for non-payment of a debt.

2. The object of mutuum is a fungible thing:

 Fungible things are not to be returned but substituted or replaced with the equivalent of the thing,
meaning another thing of the same kind, quality and quantity.

3. No interest shall be due unless it is stipulated in writing: (Art. 1956, CC)

 Usurious loans presuppose the imposition of an interest for more than or in excess of what is fair
and reasonable.

 Although the usury law has been repealed, the courts can reduce unreasonable and
unconscionable interest.

 If the borrower pays interest when there is no stipulation therefor, solutio indebiti or natural
obligation shall apply. (Note – however, if the interest is void or excessive, solution indebiti will
not apply. The court shall apply the legal interest rate in lieu of the stipulated interest.)

2. Interest

a. Monetary interest – The compensation fixed by the parties for the use or forbearance of money.

 Right to recover monetary interest arises only either by virtue of a contract.

  The monetary interest shall itself earn compensatory interest at the prevailing legal rates,
pursuant to Art. 2212 of NCC, which states that:

ARTICLE 2212. Interest due shall earn legal interest from the time it is judicially demanded,
although the obligation may be silent upon this point. (Compound interest)

Guidelines in the imposition of interest – Nacar v. Gallery Frames, 2013: IMPORTANT

1) When the obligation is breached, and it consists in the payment of a sum of money (i.e. Loan or
forbearance of money) the interest due should be that which may have been stipulated in writing.

Furthermore, the interest due shall itself earn legal interest from the time it is judicially
demanded. In the absence of stipulation, the rate of interest shall be 6% per annum to be
computed from default (i.e. from judicial or extrajudicial demand) under and subject to the
provisions of Art. 1169 of NCC.

2) When an obligation, not constituting loan or forbearance of money, is breached, an interest on

the amount of damages awarded may be imposed at the discretion of the court at the rate of 6%
per annum.

No interest, however, shall be adjudged on unliquidated claims or damages, except when or until
the demand can be established with reasonable certainty. Accordingly, where the demand is
established with reasonable certainty, the interest shall begin to run from the time the claim is
made judicially or extrajudicially – Art. 1169, NCC.

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 the judgment of the court is made (at which the
qualifications of damages may be deemed to have been reasonably ascertained). (wen the amount
is unliquidated, the action for interest is premature since the damage was not yet ascertained.)

The actual base for the computation of legal interest shall, in any case, be on the amount finally
adjudged.

3) When the judgment of the court awarding a sum of money becomes final and executory, the rate
of legal interest, whether the case falls under Par. 1 or 2 above, shall be 6% per annum from such
finality until its satisfaction, this interim period being deemed to be by then an equivalent to
forbearance of credit.

And, in addition to the above, judgments that have become final and executory prior July 1, 2013,
shall not be disturbed and shall continue to be implemented applying the rate of interest fixed
therein.

Legal interest v. Stipulated interest: (Stipulated interest shall be in writing)

Lara’s gift v. Midtown, 2019 – if the rate of interest is stipulated, such stipulated interest shall apply and
not the legal interest, provided the stipulated interest is not excessive and unconscionable.

The stipulated interest shall be applied until full payment of the obligation because it is the law between
the parties.

Void interest – Bulatao v. Estonactoc, 2019:

A 5% interest rate per month is excessive, unconscionable and exorbitant.

The willingness of the parties to enter into a relation involving an unconscionable interest rate is
inconsequential to the validity of the stipulated interest. The imposition of an unconscionable interest rate
on a money debt even if knowingly and voluntarily assumed, is immoral and unjust.

Since the rate agreed upon in void, the rate of interest should be 6% per annum from the date of judicial
or extrajudicial demand.

In a situation wherein a null and void interest rate is imposed under a contract of loan, the non-payment
of the principal loan obligation does not place the debtor in a state of default considering that Art. 1252 of
NCC provides that is a debt produces interest, payment of the principal shall not be deemed to have been
made until the interests have been covered.

Thus, since the obligation of making interest payments in the instant case is illegal and thus non-
demandable, the payment of the principal loan obligation was likewise not yet demandable. With the
debtor not being in a state of default, the foreclosure of the subject properties should not have proceeded.
(if the interest is not yet due, principal obligation is not yet due)
 b. Compensatory interest – Imposed by law or by the courts as penalty or indemnity for damages.

 Right to recover compensatory interest arises when there exist damages for delay or failure to pay
the principal loan on which the interest in demanded.

B. Deposit

 Deposit – a contract whereby a person (depositor) delivers a thing to another (depositary), for the
principal purpose of safekeeping it, with the obligation of returning it when demanded – Art. 1962,
NCC.

 Characteristics of deposit:

1. It is a real contract

2. Only movables or personal property can be the object of deposit.

XPN: Judicial deposit.

3. It is intended for the safekeeping of the thing.

4. It is generally gratuitous

5. Generally, the depositary cannot use the thing

XPN: the depositary may be allowed to use the thing if the safekeeping is still the principal
purpose of the contract. – E.g. – Storing cars – kailangan istart from time to time. ( Art. 1978,
NCC)

 Types of deposit:

Judicial Judicial deposit or sequestration takes place when an attachment or seizure pf property in
Deposit litigation is ordered by a court.

Obligation of depositary (appointed by the court):

1. To take care of the property with the diligence of a good father of a family.

2. Cannot be relieved of his responsibility until the litigation is ended or the court so
orders.

The Rules of Court apply on matter not covered by Civil Code.

Extrajudicial Voluntary Necessary

Deposit:

That wherein the delivery is made by the A deposit is necessary when:

will of the depositor. (It shall be
consensual. If through force, it is
necessary)
1. When it is made in compliance with a
legal obligation (e.g. – custodia legis)
2. When it takes place on the occasion of
any calamity such as fire, storm, flood,
pillage, shipwreck or other similar
events.

3. The deposit made by the travelers in

hotels or inns shall also be regarded as
necessary – Art. 1998, NCC.
Characteristics:

1. Generally, the depositor must be For hotel keepers to be liable as depositaries, the
the owner of the thing deposited. following elements must concur: Art. 1998,
NCC.
2. The depositary cannot dispute
the title of the depositor to the
thing deposited.
1. They have been previously informed
3. Valid even if the depositor is about the effects brought by the guests.
legally incapacitated. The
contract is merely voidable. 2. The latter have taken the precautions
prescribed regarding their safekeeping.
4. If the depositary is the party
incapacitated, the depositor shall Extended liability: Includes vehicles, animals,
only have the right to recover the and articles introduced or placed in the annexes
thing while it is in the possession
of the hotel – Art. 1999, NCC.
of the depositary. Third persons
 in good faith are protected. Memorize – matagal ng di natatanog sa bar.

Note: Malls are not liable as depositaries. The

parking of cars inside the mall is considered as
lease contract. If no parking fee, the contract is
commodatum.

Obligations of the depositary: When hotel keeper is liable – Art. 2000, NCC:

a. The loss or injury is caused by his

servants or employees.
1. To keep the things safely (to take
care of the thing) – Art. 1163, b. The loss or injury is caused by the
NCC. strangers.

2. To return the thing deposited –

Art. 1198, NCC.
o To return the thing in
the same condition if the
thing was delivered
closed and sealed – Art.
1981, NCC.
o He may retain the thing
due him by reason of the
deposit.
When hotel-keeper not liable – Art. 2000-2002,
NCC:
1. The cause is force majeure
2. The cause is robbery with use of firearm
or through irresistible force.
3. The cause is the act or acts of the guest.

3. To be liable for loss even if due to
fortuitous event:
o If it is so stipulated
o If he uses the thing
without the depositor’s
permission.
o If he delays its return.
o If he allows others to use
it.
4. Not to deposit the thing with a
third person.
4. The cause is the character of the thing.
Rule on posting of exculpatory notices:
They cannot free the hotel-keeper from
responsibility.
Any stipulation suppressing or
diminishing the liability of the hotel-
keeper shall be void – Art. 2003, NCC.
(Note – Important)
Hotel-keeper’s right of retention:

5. To notify the depositor and get
his permission before changing
the way of the deposit.
6. To collect principal and interests
in certificates, bonds, securities
or investments when they fall
due.
7. Not to use the thing without the
express permission of the
depositor.
The hotel keeper has a right to retain
the things brought into the hotel by the
guest, as a security for credits on
account of lodging, and supplies usually
furnished to hotel guests. In addition,
non-payment constitutes estafa.
Note: Check in baggage – if nasira, Airline is
liable to pay compensation for damages. Pero if
Hand carry lanf, not liable.

8. To notify the true owner of the

thing (if he is known) if the thing
deposited was discovered to be
stolen by the depositor.

o If the depositor insists

on his ownership, the
depositary may file an
action for interpleader.

9. To spend for the expenses of

preservation of the thing
deposited if the deposit is with
compensation.

Obligations of depositor:

1. To reimburse the depositary for

expenses for preservation if
deposit is gratuitous.
 2. To pay the depositary his
compensation (If onerous/with
compensation)

3. To indemnify the depositary for

loss caused by the character of
the thing.
Extinguishment of voluntary deposit:

1. Loss or destruction of the thing.

2. In case of gratuitous deposit,

upon the death of either party.

3. Other causes:

o Expiration of period
o Demand at the will of
depositor
o Mutual withdrawal from
the contract
o Fulfillment of the
purpose of the deposit
o Fulfillment of the
resolutory condition

Other deposits:

o Bank deposits – are actually in the nature of loan – Art. 1980, NCC.
o Safety deposit boxes – Special type of deposit with features similar to rent or lease
(General Banking Act)

C. Guaranty and Suretyship

 Guaranty – Art. 2047, NCC.

It is a contract where a person, called the guarantor, binds himself to another, called the creditor, to fulfill the
obligation of the principal debtor in case the latter should fail to do so. (One person promises to pay the
obligation of another)

o Characteristics of guaranty:

1) Consensual – can be perfected by mere consent. There is no requirement of delivery of the object of
the contract.

2) Accessory – because it is dependent for its existence upon the principal obligation guaranteed by it.

3) Subsidiary and conditional – it takes effect only when the principal debtor fails in his obligation
subject to limitations.

4) Unilateral – only the guarantor has the obligation to indemnify the creditor in case of failure of the
principal debtor to perform his prestation.

Kinds of guaranty

Personal guaranty: Real guaranty:

Where an individual personally assumes the Where a property (immovable or movable) is formally
fulfillment of the principal obligation. committed to answer for the principal obligation fo the
debtor.

Ex: Real estate mortgage, chattel mortgage, antichresis.

Conventional guaranty: Legal guaranty: Judicial guaranty:

By agreement of parties Require d by law. Ordered by the court. (Ex. Supersedeas

bond)

Gratuitous guaranty: Onerous guaranty:

The guarantor does not receive compensation. The guarantor is paid a valuable consideration for his
guaranty.
Definite guaranty: Indefinite: Continuing:

The guaranty is limited to the Comprises not only the
principal obligation. principal but also its
accessories and costs.
It covers all transactions, including those
arising in the future.
Future debts may be secured by a
guarantee even if the exact amount is not
yet known.

However, the guarantor cannot be sued

until the debt is liquidated, which means
that the amount of the debt is already
determined or fixed.

Continuing guarantees are valid despite

the uncertainty of amount.

o Effect of guaranty without or with the consent of the debtor:

Effect of guaranty with the consent of the debtor: Effect of guaranty without the consent of the debtor:

1. the guarantor is subrogated to all the rights a. The guarantor may recover from the debtor what
which the creditor may have against the he paid to the creditor but only to the extent of the
debtor. benefit enjoyed by the debtor.

2. This results by operation of law from the acts
of payment and there is no necessity for the
guarantor to ask the creditor to expressly
assign his rights of action.
3. The obligation of the debtor subsists. There is
just a change in the person of the creditor of
the principal debtor.
To prevent unjust enrichment:
But note:
o If the guarantor should pay without
notifying the debtor, the latter may enforce against
him all the defenses available against the creditor –
Art. 2068, NCC.

(Note: this is an example of extinguishment of o If the debt was for a period and the
obligation by novation) guarantor paid it before it became due, he cannot
demand reimbursement until the expiration of the
period – Art. 2068, NCC.

o If the guarantor paid without

notifying the debtor and the debtor repeats the
payment, the guarantor can only collect from
the creditor – Art. 2010, NCC. (Note: natural
obligation against unjust enrichment)

 What can be the subject of guaranty?

a. A valid obligation between a debtor and a creditor.

b. It may also be constituted to guarantee:

-Voidable obligations.
-Unenforceable obligations.
-Conditional obligations.

 Limit of guarantor’s liability:

1. It cannot go beyond the obligation of the principal debtor because the contract of guaranty is
merely accessory.

2. The limitation on the liability of the guarantor applies both to the:

a. Amount; and
b. Onerous character of the obligation.

Q: What is the legality of a guaranty which exceeds the principal obligation?

 A: The guaranty is not rendered void. The same shall be reduced to the extend or limit of the
debtor’s obligation.

 Form of the contract of guaranty:

a. A guaranty is not presumed; it must be express and cannot extend to more than what is
stipulated therein – Art. 2055, NCC.

b. To be enforceable, the contract must be expressed and in writing.

Rationale: Art. 1403 par. 2 (b) – A guaranty is a special promise to answer for the debt,
default or miscarriage of another.

 Qualifications of a guarantor:

1. He must be a person of integrity.

2. He has full legal capacity.

3. He has sufficient property to answer for the obligation of the debtor.

4. A creditor may demand a substitute guarantor:

a. When the original guarantor is convicted of a crime involving dishonesty, like estafa
and misappropriation.

b. When the original guarantor becomes insolvent.

 The benefit of excussion:

Under the benefit of excussion, the creditor has to resort to the properties first of the debtor. The
guarantor cannot be compelled to pay the creditor unless the latter has exhausted all the properties of the
debtor, and has resorted to all the legal remedies against the debtor – Art. 2088, NCC.

Requisites:

1. The guarantor must set up the right against the creditor upon the latter’s demand for
payment from him.

Note: This means that a final judgment must have been rendered previously against the
debtor and it was not satisfied. (Insolvency / Incapacity to pay the debt)

2. The guarantor must point out to the creditor the available property of the debtor.

Note: this benefit may be invoked or waived by the party. It is not automatically applied.

When benefit of excussion is not available:

a. If the guarantor has expressly renounced it.

b. If he has bound himself solidarily with the debtor.

c. In case of insolvency of the debtor.

d. When he has absconded, or cannot be sued within the PH, unless he has left a manager or
representative.

e. If it may be presumed that an execution on the property of the principal debtor would not result
in the satisfaction of the obligation.

 The benefit of division:

1. 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. The liability of the guarantors is joint and proportional.

3. The creditor can claim from the guarantors only the shares they are respectively bound to pay,
unless solidarity was stipulated.

 The benefit of contribution:

 1. It applies when one guarantor has paid the obligation of the principal debtor and is seeking
contribution from his co-guarantors.

Note: The co-guarantors may set up against the one who paid the same, defenses which would
have pertained to the principal debtor against the creditor.

 Guarantor’s right against the debtor:

1. Right to indemnity
 Total amount of the debt
 Legal interests
 Expenses
 Damages

2. In the following situations,

the guarantor can obtain
release or demand security to
protect him:
a. When he is sued for payment. (He can demand security to
protect him)
b. In case of insolvency of the principal debtor. (He can
demand release or security even when the obligation is not
yet demandable)

c. When the debtor has bound himself to relieve him from the
guaranty within a specified period, and this period has
expired. (The term of guarantyship has expired)

d. When the debt has became demandable by reason of the

expiration of the period of payment. (Demand security to
protect him)

e. After the lapse of 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 10 years. (release or demand security to
protect him)

f. If the debtor intends to abscond. (Security)

g. If it is imminent that the debtor will become insolvent.

(Security)

 Extinguishment of guaranty – Same grounds for extinguishing obligations under Art. 1231, NCC:

1. Payment
2. Loss of the thing due
3. Remission or condonation of debt
4. Merger or confusion of the rights of the creditor and debtor
5. Compensation
6. Novation

7. Also:

- Annulment
-Rescission
-Fulfillment of resolutory condition
-Prescription.

8. Other grounds:

-Release by acceptance of property by the creditor.

-Release made by the creditor in favor of one of the guarantors. (releases all other guarantors)

-Extension of term granted by the creditor to the debtor without the consent of the guarantor.

-When the guarantor, through some acts of the creditor, cannot be subrogated to the rights,
mortgages and preferences of the latter.
 Suretyship – It is an agreement where a party, called the surety, guarantee the performance by another
party called the principal or obligor of an obligation or undertaking in favor of a third person called the oblige.

A surety’s liability is joint and several, limited to the amount of the bond, and determined strictly by the terms
of contract of suretyship in relation to the principal contract between the obligor and the obligee.

Guaranty Surety

Similarities: They are similar because both promise or undertake to answer for the debt, default or miscarriage
of another person.

Distinction:

The liability of the guarantor depends upon an The surety assumes liability as a regular party to the
independent agreement to pay the obligation of the contract.
principal if he fails to do so.

A guarantor’s obligation is secondary. A surety’s obligation is primary.

A guarantor’s undertaking is to pay if the principal A surety’s undertaking is to pay if the principal debtor
debtor cannot pay. does not pay.

A guarantor is an insurer of the insolvency of the A surety is an insurer of a debt.

principal debtor.

A guarantor is entitled to the benefit of excussion. A surety is not entitled to benefit of excussion.

D. Real Estate Mortgage

 Mortgage, defined: Real estate mortgage is a contract whereby the debtor secures to the creditor the
fulfillment of a principal obligation, specially subjecting to such security, immovable property or real rights
over immovable property in case the principal obligation is not paid or compelled with at the time stipulated.

 Oronce v. CA, 1998 – It is a real right constituted to secure an obligation upon real property or rights therein
to satisfy with the proceeds of the sale thereof such obligation when the same becomes due and has not been
paid or fulfilled.

 Shared provisions with pledge and antichresis:

1. Art. 2085, NCC – that they be constituted to secure the fulfillment of a principal obligation.

2. Art. 2085, NCC – That the pledgor or mortgagor be the absolute owner of the thing pledged or
mortgaged.

3. Art. 2085, NCC – That the persons constituting the pledge or mortgage have the free disposal of their
property, and in the absence thereof, that they be legally authorized for the purpose.

4. Art. 2052, NCC – They must be supported by a valid obligations.

5. Art. 2087, NCC – when the principal obligation becomes due, the things pledged or mortgaged may
be alienated for the payment to the creditor.

6. Art. 2088, NCC – The creditor cannot appropriate the things given by way of pledge or mortgage, or
dispose of them. Any stipulation to the contrary is null and void. (Pactum commissorium – a
stipulation whereby the thing mortgaged shall automatically become property of the creditor in the
event of non-payment of debt – prohibited by law)

7. Art. 2089, NCC – A mortgage is indivisible, unless several things are given and each of them
guarantees only a determinate portion of the credit, in which case, the debtor shall have the right to
the extinguishment of the mortgage as the portion of the debt for which each thing is specially
answerable is satisfied.

 When a third person secures another person’s obligation:

Third persons who are not parties to the principal obligation may secure the latter by pledging or
mortgaging their own property. They are called accommodation mortgagors.

Cerna v. CA, 1993 – A third person who secures the fulfillment of another’s obligation by mortgaging his
own property is not solidarily liable with the principal obligor. The signatory to the principal contract –
loan – remains to be primarily bound. It is only upon the default of the latter that the creditor may have a
recourse on the mortgagors by foreclosing the mortgage properties in lieu of an action for the recovery of
the amount of the loan.
 And the liability of the third party mortgagors extends only to the property mortgaged. Should there be
any deficiency, the creditors has recourse on the principal debtor.

 Object of real mortgage:

Art. 2124, NCC – the object of a real estate mortgage may be:

a) Immovable
b) Alienable real rights imposed upon immovables. (Right of Possession , right to fruits of
immovable/ Incorporeal rights)

 Kinds of real estate mortgage:

Conventional mortgage That kind which is constituted voluntarily by contracting parties.

Legal mortgage That kind required by law to secure performance or payment.

Equitable mortgage That kind where the intention of the parties is to make an immovable merely as a
security for the performance of an obligation but the formalities of a real mortgage
are not complied with.

Governed by Art. 1602, NCC.

 Characteristics of real mortgage:

a) It is an accessory contract – it can only exist if there is a principal obligation which it secures.

b) It is indivisible – even though the debt is divided among the debtors or the successors in interest
of the debtor, or the credit among the creditor or successors in interest, the mortgage remains as
undivided one. (even if the obligation can be performed in parts, the mortgage is indivisible)

c) It is inseparable – the mortgage attaches to the property regardless of who will be its subsequent
owner or possessor. (XPN: Innocent purchasers for value – Sec. 32 of PD 1529: there being no
annotation of the mortgage in the title, the unrecorded mortgage cannot prevail over the rights of
an innocent purchaser for value)

d) It is subsidiary – the mortgage is answerable only if the principal obligation is not paid.

e) It is a real right – when the mortgage is duly registered or when the purchaser knows of its
existence, it is binding upon the latter.

f) It is real property – a real estate mortgage is real property by analogy.

g) It is comprehensive – it can secure all kinds of obligations which are not void.

Note: Bonnevie v. CA – Mortgage is a real right and inseparable:

Whoever is the possessor of the property mortgaged, when the obligation matures, and there is
failure to pay on the part of the debtor, the mortgage is subject to foreclosure. The mortgage
follows the property until it is discharged.

 More features of a mortgage – Oronce v. CA, 1998:

o The mortgagor generally retains possession of the mortgaged property because by mortgaging a
piece of property, a debtor merely subjects it to a lien, but ownership thereof is not parted with.

o In case of the debtor’s nonpayment of the debt secured by the mortgage, the only right of the
mortgagee is to foreclose the mortgage and have the encumbered property sold to satisfy the
outstanding indebtedness. (Prohibition against pactum commissorium – the automatic
appropriation of the mortgaged property to himself by the mortgagee)

o The mortgagor’s default does not operate to vest in the mortgagee the ownership of the
encumbered property, for any such effect is against public policy.

o Even if the property is sold at a foreclosure sale, only upon expiration of the redemption period,
without the judgment debtor having made use of his right of redemption, does ownership of the
land sold become consolidated in the purchaser.

 Additional requisite for valid constitution of real mortgage:

 o Gaotian v. Gaffud – the requisites of mortgage common to pledge are enumerated in Art. 2085. In
addition, art. 2125 indispensably that the mortgage be in public instrument and be recorded in
the appropriate registry of property.

o Matute v. Banzali – However, insofar as the contracting parties are concerned, the mortgage, even
if not recorded, is still binding between them.

o Mobil Oil PH Inc v. Dioscares – An order for foreclosure cannot be refused on the ground that the
mortgage had not been registered. (The mortgage, although not recorded, is still binding between
the parties)

 Rights of mortgagee in case of non-payment of the debt: Guanzon v. Argel.

The only right of a mortgagee in case of non-payment of debt secured by mortgage would be:

1. Foreclose the mortgage, and

2. Have the encumbered property sold to satisfy the outstanding indebtedness.

The mortgagor’s default does not operate to vest in the mortgagee the ownership of the
encumbered property (Prohibition against pactum commissorium)

 Things which are deemed included in a mortgage – Art. 2127, NCC:

A real mortgage is not limited to the immovable property offered and accepted as security for the principal
obligation but extends to all its natural accessions (not industrial), improvements, growing fruits, rents
and income, insurance proceeds and expropriation price, in case there is an expropriation by the
government.

 Mortgage as a continuing guaranty: Tan v. UCPB, 2019

o Mortgages that secure payment of “all loans, overdrafts, credit lines and other credit facilities of
accommodation, obtained or hereinafter obtained” are evidence of a continuing guaranty.

o A continuing guaranty is a recognized exception to the rule that an action to foreclose a mortgage
must be limited to the amount mentioned in the mortgage contract.

Under Art. 2053 of NCC, a guaranty may be given to secure even future debts, the amount of
which may not be known at denominated as a continuing guaranty or suretyship.

o A continuing guaranty is not limited to a single transaction, but contemplates a future course of
dealing, covering a series of transactions, generally for an indefinite time or until revoked.

It is prospective in its operation and is generally intended to provide security with respect to
future transactions within certain limits and contemplates a succession of liabilities, for which, as
they accrue, the guarantor becomes liable.

o In other words. Continuing guaranty is one that covers all transactions, including those arising in
the future, which are within the description or contemplation of the contract of guaranty, until the
expiration or termination thereof.

o A guaranty shall be construed as continuing when, by the terms thereof, it is evident that the
object is to give a standing credit to the principal debtor to be used from time to time either
indefinitely or until a certain period, especially if the right to recall the guaranty is expressly
reserved.

In other jurisdictions, it has been held that the use of particular words and expressions such as
“payment of any debt/any indebtedness/any deficiency/any sum/ or any time” has been
construed to indicate a continuing guaranty.

o The payment of the amounts stated in the mortgage shall not discharge the mortgage until full
payment of all debts obtained and unpaid.

 Stipulation against alienation – void. Art. 2130, NCC – a stipulation forbidding the owner from alienating
the immovable mortgaged shall be void.
 Ching Liu v. Co – A mortgage, which is just an encumbrance on realty, does not extinguish the title of the
debtor who does not lose his principal attribute as owner, that it the right to dispose of his property.

 Foreclosure of mortgaged property:

Definition – foreclosure is a remedy made available by the law to the mortgagee by which he subjects the
mortgaged property to the satisfaction of the obligation for which the mortgage was given.

 Kinds of foreclosure proceeding:

1. Judicial – this is the foreclosure through judicial proceedings. Rule 68 of the Rules of court governs
the procedure.

2. Extrajudicial – this is the foreclosure governed by Act. No. 3135 as amended.

 Extrajudicial Foreclosure–Act. No. 3135 as amended.

o Basis of extrajudicial foreclosure:

May only be effected if in the mortgage contract covering real estate, a clause incorporated therein
giving the mortgagee the power, upon default of the debtor, to foreclose the mortgage by an
extrajudicial sale of the mortgaged property.

o Necessity of a special power of attorney: (Agency coupled with interest thus irrevocable agency)

Sec. 1, Act 3135 – Requires that a special power to sell the property be either inserted in or
attached to the deed of mortgage.

When no such special power is inserted or attached to the mortgage, the foreclosing mortgagees
could not initiate the extrajudicial foreclosure, but must resort to judicial foreclosure pursuant to
rule 68 of ROC.

Sps. Baysa v. Sps. Plantilla, 2015 – the omission of special power is fatal to the validity and
efficacy of the extrajudicial foreclosure and warranted the invalidation of the entire proceedings
conducted by the sheriff.

Procedure for extrajudicial foreclosure of mortgage – AM No. 99-10-05-0, Aug. 7, 2001:

1. All applications for extrajudicial foreclosure of mortgage whether under the direction of the
sheriff or a notary public, pursuant to act no. 3135, as amended, shall be filed with the
executive judge, through the clerk of court who is also the ex-officio sheriff.

2. Upon receipt of an application for extrajudicial foreclosure of mortgage, it shall be the duty of
the clerk of court to:

a) Receive and docket said application and to stamp thereon the corresponding file
number, date and time of filing.

b) Collect the filing fees therefore pursuant to rule 141, Sec. 7 © as amended by AM No.
002-02-SC, and issue the corresponding official receipt.

c) Examine, in case of real estate mortgage foreclosure, whether the applicant has
complied with all the requirements before the public auction is conducted under the
direction of the sheriff or a notary public.

d) Sign and issue the certificate of sale, subject to the approval of the executive judge, or
in his absence, the vice executive judge. No certificate shall be issue in favor of the
highest bidder until all fees provided for in the aforementioned sections and in Rule
141 sec. 9 (1) as amended shall have been paid. (Provided that in no case shall the
amount payable under Rule 141 exceed P100,000)

e) After the certificate of sale has been issued to the highest bidder, keep the complete
records while awaiting any redemption within a period of 1 year from the date or
registration of the certificate of sale with the register of deeds concerned, after which,
the records shall be archived. (right of redemption)

Notwithstanding the foregoing provision, juridical persons whose property is sold

pursuant to an extrajudicial foreclosure shall have the right to redeem the property
until, but not after, the registration of the certificate of foreclosure sale which in no
 case shall be more than 3 months after the foreclosure, whichever is earlier. (right of
pre-emption)

o Redemption is allowed only in extrajudicial foreclosure:

The right of redemption in relation to a mortgage – exists only in the case of extrajudicial
foreclosure. No such right is recognized in a judicial foreclosure except only where the mortgagee
is the PNB or a bank or a banking institution.

Where a mortgage is foreclosed extrajudicially, Act 3135 grants to the mortgagor the right of
redemption within 1 year from the registration of the sheriff’s certificate of foreclosure sale.

Where the foreclosure is judicially effected, however, no equivalent right of redemption exists.
The law declares that a judicial foreclosure sale, when confirmed by an order of the court, shall
operate to divest the rights of all the parties to the action and to vest their rights in the purchaser,
subject to such rights of redemption as may be allowed by law.

Such rights exceptionally “allowed by law” (ie. Even after the confirmation by an order of the
court) are those granted by the charter of PNB and Genera Banking Act. These laws confer on the
mortgagor the right to redeem the property sold on foreclosure-after confirmation by the court of
the foreclosure sale - which right may be exercised within a period of 1 year, counted from the
date of registration of the certificate of sale in the registry of property.
o Possession – the absolute right of the purchaser:

Torrecamp v. Wealth Development Bank, 2022 – the purchaser becomes the absolute owner of
the property purchased in the foreclosure sale, if it is not redeemed during the 1 year period after
the registration of the sale. After consolidation of ownership in the purchaser’s name and issuance
of new TCT, possession of the land too becomes an absolute right of the purchaser
 Judicial foreclosure of mortgage:

o Ocampo v. Domalanta – a proceeding for judicial foreclosure of mortgage is an action quasi in

rem. It is based on a person claim against a specific property of the defendant. Its purpose is to
have the property seized and sold by court order to the end that the proceeds thereof be applied to
the payment of plaintiff’s claim.

o Sec. 1, Rule 68 – the venue of the action for foreclosure is the proper court which has jurisdiction
over the area wherein the real property involved, or a portion thereof, is situated.

o Here, the foreclosure sale, when confirmed by the order of the court, shall operate to divest the
rights of all parties to the action and to vest their rights in the purchaser. There then exists only
what is known as the equity of redemption. This is simply the right of the defendant mortgagor to
extinguish the mortgage and retain ownership of the property by paying the secured debt within
the 90 day period after the judgment becomes final, in accordance with rule 68, or even after the
foreclosure sale but prior to its confirmation.

o Sps. Rosales v. Sps. Suba, 2003 – this is the mortgagor’s equity (not right) of redemption which,
as above stated, may be exercised by him even beyond the 90 day period from the date of service
of the order and even after the foreclosure sale itself, provided it be before the order of
confirmation of the sale. After such order of confirmation, no redemption can be effected any
longer. (Take note! Important)

o GR: No right of redemption (1 year period), only equity of redemption (90 days before the
confirmation of sale)

XPN: Banks (PNB Charter and Banking laws – 1 year period of redemption)

E. Antichresis

 Definition:

Art. 2132, NCC – by the contract of antichresis, the creditor acquires the right to receive the fruits of an
immovable of his debtor, with the obligation to apply them to the payment of the interest, if owing, and
thereafter to the principal of his credit.

 Reyes v. Malance, 2016:

Antichresis involves an express agreement between parties whereby:

a) The creditor will have possession of the debtor’s real property given as security.
 b) Such creditor will apply the fruits of the said property to the interest owed by the debtor, if any,
then to the principal amount.
c) The creditor retains enjoyment of such property until the debtor has totally paid what he owes;
and
d) Should the obligation be duly paid, then the contract is automatically extinguished proceeding
from the accessory character of the agreement.

 Characteristics of contracts:

1. It is a formal contract – Art. 2134, NCC: The law requires that the amount of the principal and
the interest must be in writing, otherwise the contract of antichresis is void.

2. It is an accessory contract – it is a means of paying a principal obligation. Once the principal

obligation is paid, the contract of antichresis is extinguished.

3. It deals only with immovable property.

4. The creditor has the right to receive the fruits of immovable.

5. It is a real right if registered.

 Rights of antichretic creditor:

a) Art. 2132, NCC – right to receive the fruits and income of the property.

b) Art. 2136, NCC – right to retain the property until the debt is fully paid.

c) Art. 2137, NCC – right to have the property sold upon non-payment of the debt when due (if the
fruits is insufficient and the debtor does not offer to pay the obligation – the creditor may
foreclose the property)

d) Right of preference to the proceeds of the sale of the property.

 How to determine the amount of payment:

Art. 2133, NCC – the basis of payment is the actual market value of the fruits harvested or collected at the
time of the payment of the interest and/or principal.

 Form of antichresis:

Art. 2134, NCC – the amount of the principal and of the interest shall be specified in writing; otherwise,
the contract of antichresis shall be void.

 Obligation of antichretic creditor:

1. Art. 2135, NCC – to pay the taxes and charges assessable against the property like real estate taxes
and others.

2. Art. 2135, NCC – to bear the necessary expenses for the preservation of the property.

3. Art. 2135, NCC – to bear the expenses necessary for the repair of the property.

4. Art. 2132, NCC – to apply the fruits received for payment of the outstanding interests, if any, and
thereafter of the principal.

 Pactum commissorium, prohibited:

Art. 2137, NCC – the creditor does not acquire the ownership of the real estate for nonpayment of the debt
within the period upon.

Every stipulation to the contrary shall be void. But the creditor may petition the court for the payment of
the debt or the sale of the real property. In this case, the rules of court on the foreclosure of mortgages
shall apply. (what they can do is to foreclose the property)

Note: Dation en pago may be applied.

V. Compromise

 What is a compromise?
 o Art. 2028, NCC – A compromise is a contract whereby the parties, by making reciprocal
concessions, avoid a litigation or put an end to one already commenced.

o Like any other contract, a compromise agreement must comply with the requisites in Art. 1381 of
NCC, to wit:

1. Consent of the contracting parties.

2. Object certain that is the subject matter of the contract.
3. Cause of the obligation that is established.

o Uy v. Chua, 2009 – Like any other contract, the terms and conditions of a compromise agreement
must not be contrary to law, morals, public policy, public order and good customs.

Any compromise agreement that is contrary to law or public policy is null and void and vests no
rights in and holds no obligation for any party. It produces no legal effect at all

 What is the effect of a compromise agreement?

o Art. 2037, NCC – a compromise agreement has upon the parties the effect and authority of res
judicata; but there shall be no execution except in compliance with a judicial compromise.
(Although extrajudicial compromise shall have the effect of res judicata, if one of the parties does
not VOLUNTARILY comply with what has been agreed upon, such compromise agreement can
only be executed or enforced through judicial compromise) (eg – small claims; summary
procedure – kasunduan in brgy KPL)

o It is axiomatic that a compromise agreement once approved by the court has the force of res
judicata between the parties and should not be disturbed except for vices of consent or forgery.

(Note: if extrajudicial compromise agreement entered outside of court – just like any other
contract, can be annulled within 4 years. HOWEVER, if it is a kasunduan before the Brgy by
application of KPL – within 10 days. NOTE – IMPORTANT) CORRELLATE WITH KPL AND
REMEDIAL LAW PLEASE

Being in effect, the contract between the parties, a compromise agreement cannot be set aside by
the trial court if the parties acted in good faith.

o Sps. Magat v. Sps. Delizo, 2001 – it is immediately executory and not appealable. Such being the
case, it was the ministerial duty of the public respondent to enforce the order or judgment upon
compromise; any grievance by the intervenor sps Magat should have ventilated in a separate
proceeding.

 Remedy if compromise agreement is breached:

Art. 2041, NCC – if one of the parties fails or refuses to abide by the compromise, the other party may
either enforce the compromise or regard it as rescinded and insist upon his original demand.

 Cases where no compromise is allowed

o Under the Civil Code: Art. 2035, NCC:

1. The civil status of persons;

2. The validity of a marriage or a legal separation;
3. Any ground for legal separation;
4. Future support;
5. The jurisdiction of courts
6. Future legitimes

o Under the ADR Law: Sec. 6:

1. Labor disputes covered by Labor Code.

2. Civil Status of persons
3. Validity of marriage
4. Any ground for legal separation
5. Jurisdiction of courts
6. Future legitimes
7. Criminal liability
8. Those which by law cannot be compromised.
 Note: RA 9262 – economic abuse, can be compromised however physical abuse
or violence cannot be compromised. (bawal din yung problemang mag asawa –
like sasama sila sa bagong jowa nila)

 Effect of offer of compromise:

o Sec. 27, Rule 130, Rules of evidence:

In civil cases An offer of compromise is not an admission of any liability, and is not admissible
in evidence against the offeror.

In criminal cases Except those involving quasi-offences (criminal negligence), or those allowed by
law to be compromised, an offer of compromise by the accused may be received
in evidence as an implied admission of guilt.

Note: cases which may be compromised:

1. Estafa
2. BP 22
3. Grave coercion

Note: Rape may be compromised by actual marriage of the parties. However, an

offer of marriage by the accused during the investigation of the rape case, is also
an admission of guilt (People v. Valdez)

Note: Prosecution for violation of NIRC – not admissible in evidence as

admission of guiltbecause the law allows payment of tax to be compromised.

Note: All criminal violations may be compromised, except those already filed in
court and those involving fraud.

Note: The accused may show that the offer was made merely to avoid the
inconvenience of imprisonment or some other reason justifying a claim that the
offer was not an admission of guilt.

A plea of guilty later withdrawn, or an unaccepted offer of a plea of guilty to a

lesser offense, is not admissible in evidence against the accused who made the
plea or offer.

An offer to pay or the payment of medical, hospital or other expenses occasioned

by an injury is not admissible evidence as proof of civil or criminal liability for
the injury. (Good Samaritan doctrine)

o Gadrinab v. Salamanca, 2014:

Facts: the CA was already approved by the court and judgment based on the CA became final and
executory. Then, Nestor filed a motion for execution because he did not receive the share that was
supposed to be for his father. Apparently, the other heirs were stalling and delaying the sale of the
property. This led to conflict among the heirs thus the other heirs moved to just proceed with the physical
partition of the property. The RTC granted the motion.

On appeal to CA, the latter affirmed the trial court holding that this was an exception to immutability of
judgment because certain circumstances transpired after the finality of the decision rendering its
execution unjust and inequitable.

Issue: WON the courts erred in allowing the physical partition of the property despite the finality of a
previous judgment on compromise agreement involving the sale of the same property and the division of
its proceeds.

Ruling: the SC ruled that the trial court erred in modifying the previous judgment based on the
compromise agreement.

In a compromise, the parties freely enter into stipulations. A judgment based on a Compromise is a
judgment on the merits of the case. It has the effect of res judicata.

Applying Art. 2038 in relation to Art. 1330 of the NCC, a compromise may only be annulled if the consent
was given through mistake, violence, intimidation, undue influence or fraud.
 In this case, there was no issue as to the fact that the parties freely entered into the compromise
agreement. There was also no dispute about the clarity of its terms. Some of the parties simply do not wish
to abide by the compromise agreement’s terms.

Courts cannot relieve parties from their obligation simply because the agreements are unwise. The mere
fact that the Compromise favors one party does not render it invalid. Courts do not have the power to alter
contracts to save one party.

o Chiquita brands v. Omelio, 2017: A compromise is a contract whereby the parties, by making reciprocal
concessions, avoid a litigation or put an end to one already commenced.

A compromise is judicial if the parties’ purpose is to terminate a suit already commenced. On the other
hand, it is extrajudicial if its object is to avoid litigation.

In any case, a compromise validly entered into has the authority and effect of res judicata as between the
parties. To this extent, a judicial compromise and an extrajudicial compromise are no different from each
other.

However, unlike extrajudicial compromise, a judicial compromise that has received judicial imprimatur
becomes more than a mere contract. It is regarded as a “determination of the controversy” between the
parties and has the force and effect of final judgment. Thus, it may neither be disturbed or set aside except
in cases where there is forgery or when either of the parties’ consent has been vitiated.

The doctrine of immutability of judgments applies to compromise agreements approved by the courts in
the same manner that it applies to judgments that have been rendered on the basis of a full blown trial.

Thus, a judgment on the compromise that has attained finality cannot be “modified in any aspect, even if
the modification is meant to correct the onerous conclusions of fact and law, and whether it be made by
the court that rendered it or by the highest court of the land.

o Magdalena v. Sps. Somis, 2021 – HERNANDO CASE

There was a judicial CA which became final and executory.

The CA is valid. The CA was clear that the contracting parties mutually agreed to transfer to each other the
properties indicated therein. Even if it was Maria who prepared the written instrument, she or her
representative was expected to exercise due diligence in reviewing the entries therein before signing the
instrument. Moreover, if indeed there was a mistake on which the property should be transferred to the
sps Somis, Maria should have availed of her remedies immediately.

The SC ruled that when a decision becomes final and executory, it becomes valid and binding upon the
parties and their successors in interest. Such decisions or order can no longer be disturbed or reopened no
matter how erroneous it may have been. Furthermore, a CA is a contract which is valid and binding when
there was a meeting of the minds between the parties.

Here, Maria and Leonila mutually agreed to transfer to each other the properties indicated therein. She
was expected to have exercised due diligence in reviewing the entries therein before signing the
instrument.

VI. Quasi-Contacts

 What are quasi-contracts? - It is a lawful unilateral act which is voluntarily performed that imposes upon
the person benefitted by the act to reimburse or compensate the actor based on the principle that no one
shall be enriched at the expense of another.

The function of a quasi-contract is to raise obligation in law where in fact the parties made no promise,
and it is not based on apparent intention of the parties. (there is no contract but there is an obligation –
correlate with natural obligation)

A. Negotiorum Gestio

 Elements:

1. Subject matter is a property or business of another person called the owner.

2. Property or business has been abandoned.

3. A person called officious manager or gestor voluntarily takes charge of the management of the
property or business without the express consent or authority of the owner.
 4. The officious manager or gestor must not be acting erroneously on the belief that he is the owner of
the property or business. (the gestor must not be impelled to claim adverse interest as owner of the
property. He must be acting with the intent to help the owner of the property that has been
abandoned.)

 Obligations of the gestor:

a) To continue the management until the termination of the affair and its incidents or until he is
substituted.

b) To exercise the diligence of a good father of the family.

c) To answer for the acts of a delegate.

d) To be liable for loss even if caused by a fortuitous event (Art. 2147-2148, NCC)
 If he undertakes risky operations which the owner was not accustomed to embark upon.
 If he has preferred his own interest to that of the owner.
 If he fails to return the property or business upon demand by the owner.
 If he assumed the management in bad faith.
 If he is manifestly unfit to carry on the management.
 If by the intervention he prevented a more competent person from taking up the
management.

e) To enter into contract with third person if it is necessary.

 Obligations of the owner:

1. To be liable for obligations incurred by the gestor in his (owner’s) interest.

2. To reimburse the gestor for necessary and useful expenses and for damages which the gestor
suffered.

(damages which may arise from losses suffered by the gestor for prioritizing the property of the
owner)

 Extinguishment of negotiorium gestio:

o When the owner repudiates it or puts an end thereto.

o When the officious manager withdrawn from the management.
o By the death, civil interdiction, insanity or insolvency of the owner or the officious manager.

B. Solutio Indebiti

 Concept:

it is a tie or juridical relation which, by virtue of a payment of what is not due, made through mistake, is
created between the person who paid and the one who received the payment, compelling the latter, in
consequence thereof, to return what has been received.

 Requisites:

1. There is payment or delivery by the oblige of a thing not due or owing to the obligor.
2. The payment was made by mistake.

 Obligation by the payee:

a) To return it.

b) To pay legal interest or be liable for fruits if he accepted it in bad faith.

c) If what was accepted was a thing certain and determinate, the payee shall be liable for
impairment or loss of the thing or its accessions and accessories insofar as he was benefited.

 PNB v. CA, 1993

Solutio indebiti is a quasi-contract which is embodied under Art. 2152 of NCC. It is a tie or juridical
relation which, by virtue of a payment of what is not due, made through mistake, is created between the
 person who paid and the one who received the payment, compelling the latter, in consequence thereof, to
return what has been received.

While the facts establish a solution indebiti, Art. 1145 (2) of NCC provides that an action upon a quasi-
contract shall prescribe in 6 years. Here, the cause of action arose in 2002 but PNB’s action to recover the
amount mistakenly paid was filed only after 8 years. Clearly the action has prescribed thus PNB can no
longer recover the amount.

Note: In solution indebiti, prescription commences to run from the date of mistaken or erroneous
oayment. On the other hand, the 6 year-prescriptive period in negotiorium gestio begins to run at the time
of demand. (the expenses and damages must be liquidated)

 Madera v. COA, 2020 – Solutio indebiti in disallowance and unlawful expenditures:

Verily, the excusing payees from return on the basis of good faith has been previously recognized as an
exception to the laws on liability for unlawful expenditures.

However, being civil in nature, the liability of officers and payees for unlawful expenditures provided in
the Admin Code will have to be consistent with civil law principles such as Solutio indebiti and unjust
enrichment.

These civil law principles support the propositions that:

1. Good faith of payee is not determinative of their liability to return; and

2. When the court excuses payees on the basis of good faith or lack of participation, it amounts
to a remission of an obligation at the expense of the government.

To be sure, the application of the principles of unjust enrichment and solution indebiti in disallowed
benefits cases does not contravene the law on the general liability for unlawful expenditures.

In fact, these principles are consistently applied in government infrastructure or procurement cases which
recognize that a payee contractor or approving and/or certifying officers cannot be made to shoulder the
cost of a correctly disallowed transaction when it will unjustly enrich the government and the public who
accepted the benefits of the project.

 LUMAUAN v. COA, 2020 – HERNANDO CASE – Madera ruling applied:

Facts: Lumauan was the acting gen. manager of Metropolitan water district, a GOCC created pursuant to
PD No. 198 as amended by RA. 9286.

The board of directors issued board resolution approving the payment of accrued cost of living allowance
(COLA) to qualified MWD employees for calendar years 1992-1997 in the aggregate amount of P1, 689,
750.00.

However, after post audit, a notice of disallowance was issued, disallowing the payment of COLA for lack
of legal basis specifically since the COLA was already deemed integrated into the basic salary of the
employees.

Regional Director Atty. Torre denied the appeal for lack of merit. He affirmed the disallowance on the
ground that the payment of COLA was prohibited since it was already integrated into the basic salary of
the employees. Respondent COA-CP agreed with the observation of the regional director that the appeal
was belatedly filed.

It ruled that the disallowance has already become final and executory because petitioner belatedly filed
the appeal or 12 days from receipt of the decision of regional director. It reiterated the ruling of RD that
the payment of COLA was prohibited because it was already incorporated in the basic salary rates of
government employees under the general rule on integration.

Issue: WON petitioner can be held personally liable for the disallowed benefit to the extent of the amount
she actually and individually received.

Ruling:

YES. Petitioner can be held personally liable for the disallowed benefit to the extent of the amount she
actually and individually received pursuant to our ruling in Madera v. COA.

In Madera, the court promulgated the following rules on return of disallowed amounts:
 1. If a notice of disallowance is set aside by the court, no return shall be required from any of the
persons held liable therein.

2. If a notice of disallowance is upheld, the rules on return are as follows:

 Approving and certifying officers who are clearly shown to have acted in bad
faith, malice, or gross negligence are, pursuant to Sec. 43 of Admin Code of 1987,
solidarily liable to return only the net disallowed amount which, as discussed
herein, excludes amounts excused under the following sections 2c and 2d.

 Recipients – whether approving or certifying officers or mere passive recipients –

are liable to return the disallowed amounts respectively received by them, unless
they are able to show that the amounts they received were genuinely given in
consideration of services rendered.
 The court may likewise excuse the return of recipients based on undue prejudice,
social injustice considerations, and other bona fide exceptions as it may
determine on a case to case basis.

Here, petitioner Lumauan, as acitng Gen. manager of MWD, was not the one who approved the grant of
the accrued COLA but the board of directors. Petitioner was only a recipient or a passive payee of the
allowance.

She thus fell under category 2c. Under the rules on return of disallowed amounts in Madera, and applying
the civil law principles on solutio indebiti and unjust enrichment, recipients - whether approving or
certifying officers or mere passive recipients – like Madera in this case, are liable to return the disallowed
amounts respectively received by them, unless they are able to show that the amounts they received were
genuinely given in consideration of services rendered. Payees who receive undue payment, regardless of
good faith, are liable for the return of the amounts they received.

None of the extenuating circumstances were present. As pointed out by the COA, petitioner is not entitled
to said allowance because it was already incorporated in the standardized salary rates of government
employees. Neither was it established that ordering its return would unduly prejudice the petitioner. It
was also not shown that social justice of humanitarian considerations were extant to the instant case.

Thus, there is no justifiable circumstance present that would excuse petitioner from returning the
disallowed benefit to the extent of the amount she actually and individually received.

Petitioner should only be held liable to return the disallowed amount corresponding to the amount
actually and individually received by her.

Torts and Damages

A. Principles

 Quasi-delict or culpa aquilana:

Refers to fault or negligence which results in damage to another, there being no pre-existing contractual
relation between the parties, and is governed by Art. 2176 of NCC.

Art. 2176, NCC – whoever by A/O causes damage to another, there being fault or negligence, is obliged to
pay for the damage done. Such fault or negligence, if there is no pre-existing contractual relation between
the parties, is called a quasi-delict.

 Requisites before a person may be liable under quasi-delict:

a) There must be an act or omission

b) There must be damage or prejudice
c) There must be casual relationship between the A/O and the damage done.
d) There must be no pre-existing contractual relationship between the parties.

Loadmasters v. Glodel Brokerage, 2011 – A liability for tort may arise even under a contract, where
tort is that which breaches the contract.

 Torts, which is a much broader concept, includes intentional and malicious acts and is covered by Art. 19,
20 and 21 of the NCC and by the RPC.

Tort is broadly defined as a breach of legal duty. It is essentially consists in the violation of a right given or
omission of statuory duty imposed by law.
 Tort is an A/O producing an injury to another, without need of any previous existing relation which the
said A/O may be said to be natural outgrowth or incident. Tort is a breach of legal duty; tort essentially
consists in the violation of a right given or omission of staturoy duty imposed by law.

 To sustain a claim based on quasi-delict, the following requisites must concur:

a) Damage suffered by the plaintiff.

b) Fault or negligence of defendant.
c) Connection of cause and effect between the fault or negligence of defendant and the damage incurred
by the plaintiff.

 Distinction between Quasi-delicy and torts - Baksh v. CA, 1993:

Quasi-delict is limited to negligent A/O and excludes the notion of willfulness or intent. Quasi-delict,
known also as Culpa Aquillana, is a civil law concept while torts is an Anglo-american or common law
concept.

Torts is much broader than Quasi-delict because it includes not only negligence but international criminal
acts such as assault and battery, false imprisonment and deceit. (Torts cover intentional acts)

 Concurrence of cause of action:

a) One A/O, One defendant, 2 or more causes of action:

E.g. A common carrier’s liability may arise ex contractu (breach of contract) and at the same time
ex quasi delict (quasi-delict) and ex delicto (crime).

b) One A/O, 2 or more defendants, 2 or more causes of action:

E.g. Injury suffered by a passenger of a common carrier operated by X and driven by Y may given
rise to a liability based on contract for X and liability for reckless imprudence (a crime) for Y. –
Vicarious liability: Art. 2180, NCC.

 Standard of good human relations:

1. Art. 19, NCC – every person must, in the exercise of his rights and in the performance of his
duties, act with justice, give everyone his due, and observe honesty and good faith. (This is the
standard)

2. Art. 20, NCC – Every person who, contrary to law, willfully or negligently causes damage to
another, shall indemnify the latter for the same. (This is the remedy if the standard is violated)

3. Art. 21, NCC - Any person who willfully causes loss or injury to another in a manner that is
contrary to morals, good customs or public policy shall compensate the latter for the damages.
(Acts contra bonus more – obligation to pay damages for violation of morals, good customs or
public policy)

1. Abuse of Rights

Violation of Art. 19, NCC results to abuse of right.

 Art. 19, NCC – every person must, in the exercise of his rights and in the performance of his duties, act
with justice, give everyone his due, and observe honesty and good faith. (This is the standard)

 Requisites:

a) There is a legal right or duty.

b) Which is exercised in bad faith.
c) For the sole intent of prejudicing or injuring another.

Note: If it is contrary to law, use Art. 20. If it is contrary to morals, good customs or public policy, use
Art. 21.

 Baron’s Marketing v. CA, 1998 – there is an abuse of right when it is exercised for the purpose of
prejudicing or injuring another. When the objective of the actor is illegitimate, the illicit act cannot be
concealed under the guise of exercising a right. Here, there is no abuse of right since the private
respondent was merely exercising its right to collect payment. Such act does not constitute abuse of right
since it is the private respondent’s right to collect full payment instead of agreeing to the petitioner’s
request of granting partial payment. (The creditor cannot be compelled to accept partial payment)
 Uypitching v. Quiamco, 2006 – A mortgagee may take steps to recover the mortgaged property to enable
it to enforce or protect its foreclosure right thereon. There is, however, a well-defined procedure for the
recovery of possession of mortgaged property. If a mortgagee is unable to obtain possession of the
mortgaged property for its sale on foreclosure, he must bring a civil action either to recover such
possession as a preliminary step to the sale or to obtain judicial foreclosure. (He cannot threaten the
mortgagor and take the property extrajudicially against the will of the mortgagor)

 Ardiente v. Sps. Pastorfide, 2013 – The exercise of a right must be in accordance with the purpose for
which it was established and must not be excessive or unduly harsh. There must be no intention to harm
another. Otherwise, liability for damages to the injured party will attach. (Case involves cutting of
electrical wires without notice to the injured party)

 California clothing v. Quinones, 2013 – Under the abuse of rights principle, a person must, in the exercise
of legal right and duty, act in good faith. He would be liable if he instead acted in bad faith, with intent to
prejudice another.

Good faith refers to the state of mind which is manifested by the acts of the individual concerned. It
consists of the intention to abstain from taking an unconscionable and unscrupulous advantage of
another. Malice or bad faith, on the other hand, implies a conscious and intentional design to do a
wrongful act for a dishonest purpose or moral obliquity.

The exercise of a right must be in accordance with the purpose for which it was established and must not
be excessive or unduly harsh. (The employee of CC accused the customer of not paying while there are
other customers inside the store which caused embarrassment to the latter)

 Carpio v. Valmonte, 2004 – By openly accusing respondent as the only person who went out of the room
before the loss of the jewelry in the presence of all the guests therein, and ordering that she be
immediately bodily searched, petitioner virtually branded respondent as thief.

True, petitioner had the right to ascertain the identity of the malefactor, but to malign respondent without
an iota of proof that she was the one who actually stole the jewelry is an act which, by any standard or
principle of law is impermissible. Petitioner had willfully caused injury to respondent in a manner which
is contrary to morals and good customs.

 Arco Pulp v. Lim, 2012 - Art. 19 by itself is not a basis of an actionable tort (It is merely the standard).

Art. 19 is the general rule which governs the conduct of human relations.by itself, it is not the basis of an
actionable tort. Art. 19 describes the degree of care required so that an actionable tort may arise when it is
alleged together with Art. 20 and 21.

To be actionable, art. 20 requires a violation of law, while Art. 21 only concerns with lawful acts that are
contrary to morals, good customs, and public policy.

 Under what provision is a breach of contract (done fraudulently or in bad faith) actionable?

Violation of contract: When a party reneges on his obligation arising from contracts in bad faith, the act is
not only contrary to morals, good customs or public policy; it is also a violation of Art. 1159.

Breach of contract become the basis of moral damages, not only under Art. 2220, but also under Art. 19
and 20 in relation to Art. 1159, NCC.

a) Art 2220, NCC – moral damages may be awarded in case of breach of contract where the
breach is due to fraud or bad faith.
b) Art. 1159, NCC – Obligations arising from contracts have the force of law between the
contracting parties and should be complied with in good faith.

 Rellosa v. Pellosis, 2001 – Petitioner might verily be the owner of the land, with the right to enjoy and
exclude any person from the enjoyment and disposal thereof, but the exercise of these rights is not
without limitation.

The abuse of right rule requires every person to act with justice, to give everyone his due, to observe
honesty and good faith. When a right it exercised in a manner which discards these norms resulting in
damage to another, a legal wrong is committed for which the actor can be held accountable.

In this instance, the issue is not so much about the existence of the right or validity of the order of
demolition as the question of WON petitioners have acted in conformity with, and not in disregard of, the
standard set by Art. 19 of NCC. (the lessee should have been allowed to review the demolition memo)
2. Unjust Enrichment – Solutio indebiti

Art. 22, NCC – Every person who, through an act of performance by another, or any other means,
acquires or comes iinto possession of something at the expense of the latter without just or legal ground,
shall return the same to him.

 Requisites for an action in rem verso:

a) Defendant has been enriched.

b) Plaintiff suffered a loss.
c) Enrichment of defendant is without just or legal ground.
d) Plaintiff has no other action based on contract, quasi-contract, crime or quasi-delict.

3. Liability Without Fault

Art. 23, NCC – Even when an act or event causing damage to another’s property was not due to the fault
or negligence of the defendant, the latter shall be liable for indemnity if through the act or event he was
benefited.

4. Acts Contrary to Law

 Art. 20, NCC – Every person who, contrary to law, willfully or negligently causes damage to another, shall
indemnify the latter for the same. (This is the remedy if the standard is violated)

5. Acts Contrary to Morals

4. Acts contra bonus mores – Source: Art. 21, NCC - Any person who willfully causes loss or injury
to another in a manner that is contrary to morals, good customs or public policy shall compensate
the latter for the damages. (Acts contra bonus more – obligation to pay damages for violation of
morals, good customs or public policy)

Elements:

a) There is an act that is legal;

b) But is contrary to morals, good custom, public order or public policy; and
c) It is done with intent to injure
 Examples:

Breach of promise to marry Baksh v. CA, 1993.

Excessive and exorbitant interest on a loan Medel v. CA, 1998.

Desertion by a spouse Tenchavez v. Escano, 1996.

Public humiliation like slapping the plaintiff in public Patricio v. Leviste, 1989.

Malicious prosecution Bayani v. Panay Electric, 2000.

 Right to privacy

International law basis – no one shall be subjected to arbitrary or unlawful interference with his privacy,
family, home or correspondence nor to unlawful attacks on his honor and reputation (Art. 17, ICC)

Constitutional basis – the privacy of communication and correspondence shall be inviolable, except upon
lawful order of the court, or when public safety or order requires otherwise – Art. III, Sec. 3 (1), 1987
Constitution.

 Art. 32, NCC – Any public officer or employee, or any private individual, who directly or indirectly
obstructs, defeats, violates or in any manner impedes or impairs the following rights and liberties of
another person shall be liable to the latter for damages:

a) The right to be secured in one’s person, house, papers and effects against unreasonable search and
seizure.

b) The privacy of communication and correspondence.

 Art. 26, NCC – every person shall respect the dignity, personality, privacy and peace of mind of his
neighbors and other persons.
  Sps. Hing v. Chuachuy, 2013:

In ascertaining whether there is a violation of right to privacy, the court use the “reasonable expectancy of
privacy” test. This test determines whether a person has a reasonable expectation of privacy and whether
the expectation has been violated.

In Ople v. Torres, we enunciated that “the reasonableness of a person’s expectation depends on two part
test:

a) Whether, by his conduct, the individual has exhibited an expectation of privacy

b) This expectation is one that society recognizes as reasonable.

Customs, community norms, and practices may, therefore, limit or extend an individual’s “reasonable
expectation of privacy”. Hence, the reasonableness of a person’s expectation of privacy must be
determined on a case-to-case basis since it depends on the factual circumstances surrounding the case.
(Note: Rule on CCTV)

 Belo-Henares v. Guevarra – 2016:

Before one can have an expectation of privacy in his or her online social networking activity – in this case
– facebook, it is first necessary that said user manifests the intention to keep certain posts private,
through the employment of measures to prevent access thereto or to limit its visibility.

The intention can materialize in cyberspace through the utilization of facebook’s privacy tools. In other
words, utilization of these privacy tools is the manifestation, in the cyberworld, of the user’s invocation of
his or her right to informal privacy.

 Malicious prosecution – the complainant is entitled for damages because there was an abuse of the
process.

Malicious prosecution has been defined as an action for damages brought by one against whom a
criminal, civil or other legal proceeding has been instituted maliciously and without probable cause, after
the termination of such prosecution or suit.

The statutory basis for a civil action for damages for malicious prosecution are found in the provisions of
NCC on human relations and on damages particularly Art. 19, 20, 21, 26, 29, 32, 33, 35, 2217, and 2219.

There is an abuse of process when there are tactics to prevent the offended party of presenting his
evidence or when there is evidence of corruption of officers involved in the proceeding

1. Intentional

Intentional torts – includes conducts where the actor desires to cause the consequences of his act or
believe the consequences are substantially certain to result from it.

It includes:

a) Assault
b) Battery
c) False imprisonment
d) Defamation
e) Invasion of privacy
f) Interference of property.

Art. 20, NCC - Every person who, contrary to law, willfully or negligently causes damage to
another, shall indemnify the latter for the same.

Art. 21, NCC - Any person who willfully causes loss or injury to another in a manner that is
contrary to morals, good customs or public policy shall compensate the latter for the damage.

2. Negligent

Negligent Torts – involves voluntary A/O that results in injury to others, without intending to cause the
same.the tortfeasor fails to exercise due care in performance of such A/O.

Any other A/O where there is fault or negligence. (See discussion below)

3. Strict Liability

Strict liability – liability independent of Fault or negligence.

  Where the person is made liable independent of fault or negligence upon submission of proof of certain
facts.
 The conduct is generally not wrongful in itself but the wrong consists in causing harm by engaging in
certain types of risky activities.

a) Against Possessor of animal – Art. 2183, NCC:

The possessor of an animal or whoever may make use of the same is responsible for the damage which it
may cause, although it may escape or be lost. This responsibility shall cease only in case the damage
should come from the fault of the person who has suffered damages.

The obligation is not based on the negligence or on the presumed lack of vigilance of the possessor or user
of the animal causing the damage. It is based on natural equity and on the principle of social interest that
he who possesses animals for his utility, pleasure or service must answer for the damage which such
animal may cause.

 Vestil v. IAC, 1989 - What must be determined is the possession of the dog that admittedly was staying in
the house in question, regardless of the ownership of the dog or of the house.

Art. 2183 NCC holds the possessor liable even if the animal should “escape or be lost” and so be removed
from his control. And it does not matter either that, as the petitioners also contend, the dog was tame and
was merely provoked by the child into biting her. The law does not speak only of vicious animals but
covers even tame ones as long as they cause injury.

As for the alleged provocation, the petitioners forget that the victim was only 3 years old at the time she
was attacked and can hardly be faulted for whatever she might have done to the animal.

b) Against Food manufacturers and processors – Art. 2187, NCC:

Manufacturers and processors of foodstuffs, drinks, toilet articles and similar goods shall be liable for
death or injuries caused by any noxious or harmful substances used, although no contractual relation
exists between them and the consumers.

 Coca-cola v. Menze, 2017 - Prior resort to government agencies (e.g. DFB) is not necessary for a suit for
damages under Art. 2187, NCC.

However, plaintiff must present competent, credible and preponderant evidence to prove that he/she
suffered physical injuries when he allegedly ingested the stuff in question.

c) Against LGUs: Defective roads, streets public works – Art. 2189, NCC:

Provinces, cities and municipalities shall be liable for damages for the death of or injuries suffered by, any
person by reason of the defective condition of roads, streets, bridges, public buildings, and other public
works under their control or supervision.

 For liability to arise under Art. 2189 NCC, ownership of the roads, streets, bridges, public buildings and
other public works, is not a controlling factor, it being sufficient that a province, city or municipality has
control or supervision thereof. (GR: National roads are owned by the national govt. XPN – LGUs are of
duty to supervise roads thus they can be held liable.)

Knowledge of the condition of the road and the defects and/or obstructions on the road may be actual or
constructive. It is enough that authorities should have known of the aforesaid circumstances in the
exercise of ordinary care.

 Municipality of San Juan v. CA, 2005 - It is the duty of the municipal authorities to exercise an active
vigilance over the streets; to see that they are kept in a reasonable safe condition for public travel. They
cannot fold their arms and shut their eyes and say they have no notice.

d) Against building owners: Collapsing buildings – Art. 2190, NCC:

The proprietor of a building or structure is responsible for the damage resulting from its total or partial
collapse, if it should be due to the lack of necessary repairs.

 Roy v. CA, 1988 – this article was applied in a case where the firewall of a burned-out building owned by
petitioners De Roys collapsed and destroyed the tailoring shop occupied by the family of private
respondents Bernals, resulting in injuries to private respondents and the death of their daughter.
The argument that the private respondents had the last clear chance to avoid the accident if only they
heeded the warning to vacate the tailoring shop and, therefore, petitioners prior negligence should be
disregarded, was rejected since the doctrine of last clear chance which has been applied to vehicular
accidents, is inapplicable to this case.
e) Against inducers – Art. 1314, NCC:

f) Against fellow workers with solidary liability against employers – Art. 1712, NCC:

 If the death or injury is due to the negligence of a fellow worker, the latter and the employer shall be
solidarily liable.

g) Against engineers and architects – Art. 1723, NCC:

 The engineer or architect who drew up the plans and specifications for a building is liable for damages if
within 15 days from the completion og the structure, the same should collapse by reason of a defect in
those plans and specifications, or due to the defect in the ground.

 The action must be brought within 10 years following the collapse of the building.

h) Against drivers with solidary liability against motor vehicle owners – Art. 2184, NCC:

 In motor vehicle mishaps, the owner is solidarily liable with his driver, if the former, who was in the
vehicle, could have, by the use of the due diligence, prevented the misfortune.

i) Against other owners – Art. 2191, NCC: Proprietors shall also be responsible for damages caused:

 By the explosion of machinery which has not been taken care of with due diligence, and the
infallmation of explosive substances which have not been kept in a safe and adequate place.

 By excessive smoke, which may be harmful to persons or property.

 By the falling of trees situated at or near highways or lanes, if not caused by force majeure.

 By emanation from tubes, canals, sewers or deposits of infectious matter, constructed without
precautions suitable to the place.

C. The Tortfeasor

1. Joint

 Where the concurrent or successive negligent A/O of two or more persons, although acting independently,
are in combination the direct and proximate cause of a single injury to a third person.
 Art. 2194, NCC – the responsibility of two or more persons who are liable for quasi-delict is solidary.

 There is no contribution between joint tortfeasors whose liability is solidary since both of them are liable
for the total damage.

2. Direct

 The person whose A/O directly or principally causes the injury or damage.

 A. Natural persons – Art. 2176, NCC – whoever by A/O causes damage to another, there being fault or
negligence, is obliged to pay for damages done.

 B. Juridical persons: Solidarily liable.

D. Quasi-Delict vs. Culpa Contractual vs. Culpa Criminal

1. Nature of Liability

Aquiliana Contractual Criminal

Direct, substantial and Negligence is merely incidental Direct, substantial and

independent of a contract independent of a contract

No pre-existing obligation, except There is a pre-existing obligation No pre-existing obligation, except

the duty to do no harm. the duty to do no harm.

Preponderance of evidence Preponderance of evidence Proof beyond reasonable doubt

required required

Defense of a good father of a family Defense of a good father of a family The employee’s guilt is
is a proper and complete defense. is inapplicable. Respondeat automatically the employer’s civil
 superior applies. guilt if the former is insolvent.

Ordinarily, complainant must Presumption arises upon proof that Prosecution has burden to prove
prove the negligence of the there was a contract and that it was the negligence of the accused.
defendant. not carried out.

E. Proximate Cause

1. Concept

 Vda Bataclan v. Medina, 1957 – Proximate cause is that cause, which, in natural and continuous sequence,
unbroken by any efficient intervening cause, produces the injury, and without which the result would not
have occurred. The damage would not have happened if the driver exercised due diligence required by
law.

 Efficient intervening cause : one which destroys the casual connection between the negligent act and
injury and thereby negates liability.

Manila Electric Co. v. Remoquillo, 1950 – A prior and remote cause cannot be made the basis of an action
if such remote cause did nothing more than furnish the condition or give rise to the occasion by which the
injury was made possible, if there intervened between such prior or remote cause ant the injury a distinct,
successive, unrelated, and efficient cause of the injury, even though such injury would not have happened
but for such condition or occasion.

If no danger existed in the condition except because of the independent cause, such condition was not the
proximate cause. And if an independent negligent act or defective condition sets into operation the
circumstances which result in injury because of the prior defective condition, such subsequent act or
condition is the proximate cause.

 Abrogar v. Cosmos Bottling Co. , 2017 – to be considered the proximate cause of the injury, the negligence
need not be the event closest in time to the injury; a cause is still proximate, although farther in time in
relation to the injury, if the happening of it set other foreseeable events into motion resulting ultimately in
the damage.

 Mercury drug v. Baking – proximate cause is determined from the facts of each case, upon a combined
consideration of logic, common sense, policy and precedent.

The care required must be commensurate with the danger involved, and the skill employed correspond
with the superior knowledge of the business which the law demands.

 Requisites: to sustain a claim based on quasi-delict, the following requisites must concur:

a. Damage suffered by the plaintiff

b. Fault or negligence of the defendant
c. Connection of the cause and effect between the fault or negligence of defendant and the damage
incurred by the plaintiff.

2. Doctrine of Last Clear Chance

 Mckee v. IAC, 1992 – last clear chance is a doctrine in the law of torts which states that the contributory
negligence of the party injured will not defeat the claim for damages if it is shown that the defendant
might, by the exercise of reasonable care and prudence, have avoided the consequences of the negligence
of the injured party. In such cases, the person who had the last clear chance to avoid the mishap is
considered in law solely responsible for the consequences thereof.

 The law is that the person who has the last clear chance to avoid the impending harm and fails to do so is
chargeable with the consequences, without reference to the prior negligence of the other party.

 The doctrine is being applied for the purpose of determining the proximate cause of the accident.

 Cases where the doctrine is inapplicable:

a. If the plaintiff was not negligent, that is, only the defendant was negligent. (PNR v. Vizcara)

b. Where the defendant is required to act instantaneously, and if the injury cannot be avoided by the
application of all means at hand after the peril is or should have been discovered; at least in cases in which
any previous negligence of the party charged cannot be said to have contributed to the injury.
 c. If defendant’s negligence is a concurrent cause and which was still in operation up to the time the injury
was inflicted. In other words, it cannot be applied in the field of joint tortfeasors and it cannot be invoked
as between defendants who are concurrently negligent.

d. Where the plaintiff, a passenger, led an action against a carrier based on contract.
e. If the actor, though negligent, was not aware of the danger or risk brought about by a prior fraud or
negligent act

F. Vicarious Liability

Art. 2180, NCC: (Vicarious liability) Persons made responsible for others – the person who has responsibility over
the principal tortfeasor is held liable because he abetted, encouraged or promoted the act of the latter, or because
he failed to exercise such degree of diligence in order to prevent the injury or damage.

 Under the principle of vicarious liability under Art. 2180 of NCC, the obligation imposed by Art. 2176 is
demandable not only for one’s own A/O, but also for those persons for whom one is responsible. The
activities or situations where vicarious liability attaches are as follows:

Vicarious liability of parents: The liability is directly and Defenses:

primary
The father, and in case of death or a) The child is not living in
incapacity, the mother, are (No need to sue the child first. their company.
responsible for the damages caused There is presumption of
by the minor children who live in negligence on the part of the b) Exercise of diligence of a
their company. parents.) food father of a family to
prevent damage.

Vicarious liability of guardians: The liability is direct and primary Defense:

Guardians are liable for damages Exercise of a good father of a

caused by the minor or incapacitated family to prevent damage.
person who are under their authority
and live in their company

Vicarious liability of vehicle owners: a. If owner is in the vehicle – Duavit v. CA – an owner of a

solidary liable with the driver, vehicle cannot be held liable for
if he could have, by the use of an accident involving the said
due diligence, prevented the vehicle if the same was driven
misfortune. without his consent or
knowledge and by a person not
b. If not in the vehicle, Art. 2180 employed by him.
applies.

Vicarious liability of teachers: The liability is direct and primary Defenses:

Teachers or head of establishments a) The student is not in their

of arts and trades shall be liable for custody.
damages caused by their pupils and b) Exercise of diligence of a
students or apprentices, so long as goof father of a family to
they remain in their custody. prevent damage.

(Art. 2180, NCC – limited to teachers

and heads of establishment of arts
and trades)

Special parental authority: Their liability is principal and Defenses:

solidary.
Under Art. 218 of FC, the school, a) The activity is not an
administrator, teachers and other authorized activity.
persons engaged in child care shall be b) The child is not under their
liable for damages caused by the supervision, instruction or
minor. custody.
c) Exercise of due diligence.
(Art. 218, FC – Broader in scope)

The owners and managers of an The liability is direct and primary, Defenses:
establishment or enterprise are and solidary with employee.
likewise responsible for damages a) The employee is not
caused by their employees in the performing his functions or
service of the branches in which the he is acting beyond the
 latter are employed or on occasion of scope of his function.
their functions.
b) Exercise of due diligence in
the selection or supervision
Vicarious liability of employers: of the employee.

Employers shall be liable for

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.

Vicarious liability of the State: The liability is direct and primary Defense:

The State is responsible in like
manner when it act through a special
agent; but not when the damage has
been caused by the official to whom
the task done properly pertains, in
which case what is provided in Art.
2176 NCC shall be applicable.
(BPI v. Central Bank – Hernando
Case: TAKE NOTE
The person who directly caused
the loss is NOT a special agent –
the official was performing the
task that properly pertains to
him.

 Fontanilla v. Maliaman, 1989 - The liability of the State has two aspects, namely:

a) Its public or governmental aspects where it is liable for the tortious acts of special agents only; and
b) Its private or business aspects (As when it engages in private enterprises) where it becomes liable as
an ordinary employer.

 Merrit v. Govt of PH, 1916 – A special agent is one who receives a definite and fixed order or commission,
foreign to the exercise of the duties of his office if he is a special official.

 BPI v. Central bank, 2020 (Hernando case) – For the state to be liable as an ordinary employer, the
fraudulent acts must have been in furtherance of the State’s interest or done for its account.

The plaintiff has the burden to prove that the fraudulent acts were performed within the scope of the
employee’s assigned tasks.

It is only then that the presumption that the State, as employer, was negligent would arise which then
compels the State to show evidence that it exercised due diligence in the selection and supervision of its
employees.
Note: If special agent, State is not liable. However, if it is private or business aspect (proprietary capacity
of state) the state is considered as ordinary employee hence liable.

G. Res Ipsa Loquitur

 Africa v. Caltex, 1966 – where the thing which caused injury, without fault of the injured person, is under
the exclusive control of the defendant and the injury is such as in the ordinary course of things does not
occur if those having such control use proper care, it affords reasonable evidence, in the absence of the
explanation that the injury arose from defendant’s want of care.

 Apply in situations where the injury could not have happened unless the defendant is negligent.
(E.g. is it natural that a scissor was left inside the body after operation?)

 The doctrine applies where:

a. The accident was of such character as to warrant an interference that it would not have happened
except for the defendant’s negligence.

b. The accident must have been caused by an agency or instrumentality within the exclusive
management or control of the person charged with the negligence complained of.

c. The accident must not have been due to any voluntary actions or contribution on the part of the
person injured.

 Requisites:

a. The occurrence of an injury.

 b. The thing which caused the injury was under the control and management of defendant (TAKE
NOTE)
c. The occurrence was such that in the ordinary course of things, would not have happened if those
who had control or management used proper care; and
d. The absence of explanation by the defendant.

Note: the doctrine rests on inference and not presumption. The facts of the occurrence warrant the
supposition of negligence and they furnish circumstantial evidence of negligence when direct evidence
is lacking.

H. Damnum Absque Injuria

 There can be damage without injury in those instances in which the loss or harm was not the result of a
violation of a legal duty. In such cases, the consequences must be borne by the injured person alone, the
law affords no remedy for damages resulting from an act which does not amount to a legal injury or
wrong.

 If damage results from a person exercising his legal rights, it is damnun absque injuria.

I. Defenses

Complete Defenses Partial defenses

a. Plaintiff’s own negligence: 1. Doctrine of Contributory Negligence.

ART 2179. When the plaintiff's own
negligence was the immediate and
proximate cause of his injury, he cannot
recover damages.
XPN: Doctrine of attractive nuisance -
One who maintains on his premises
dangerous instrumentalities or appliances
of a character likely to attract children in
play, and who fails to exercise ordinary
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. Note however
that this 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
ART 2179. xxx But if his negligence was only
contributory, the immediate and proximate cause of
the injury being the defendant's lack of due care, the
plaintiff may recover damages, but the courts shall
mitigate the damages to be awarded.
1. Contributory Negligence is the act or omission
amounting to want of ordinary care on the part of the
person injured, which, concurring with the
defendant's negligence, is the proximate cause of the
injury. (Cayao-Lasam v. Sps Ramolete)
2. A collecting bank is guilty of contributory
negligence when it accepted for deposit a post-dated
check notwithstanding that said check had been
cleared by the drawee bank which failed to return the
check within the 24-hour reglementary period. (Allied
Banking v. BPI 2013)
3. It must be shown that plaintiff performed an act
that brought about his injuries in disregard of
warnings or signs of an impending danger to health
and body.

1. that the plaintiff had actual knowledge of the

danger;

2. that he understood and appreciated the risk

from the danger; and

3. that he voluntarily exposed himself to such risk.

The knowledge must be of the SPECIFIC risk that

caused the harm to the plaintiff. (Abrogar v.
Cosmos Bottling 2017)

When Inapplicable

1. A person is excused from the force of the rule,

that when he voluntarily assents to a known
danger he must abide by the consequences, if an
emergency is found to exist or if the life or
property of another is in peril, or when he seeks to
rescue his endangered property. (Ilocos Norte
Electric Company v. CA)

2. A passenger boarding an overloaded vehicle

 does not amount to an implied assumption of risk.

c. Doctrine of Last Clear Chance;

Where both parties are negligent but the negligent

act of one is appreciably later in point of time than
that of the other, or where it is impossible to
determine whose fault or negligence brought
about the occurrence of the incident, the one who
had the last clear opportunity to avoid the
impending harm but failed to do so, is chargeable
with the consequences arising therefrom

d. Emergency Rule; (Discussed below)

e. Prescription.

Actions based on quasi-delict shall

prescribe 4 years from the day that they
may be brought. The institution of a
criminal action cannot have the effect of
interrupting the institution of a civil
action based on a quasi-delict

J. Negligence

 Art. 1173, NCC – the fault or negligence of the obligor consists in the omission of that diligence required
by the nature of the obligation based on the circumstances of the persons, of the time and of the place.

 Art. 365, RPC on the other hand – reckless imprudence consists voluntarily, but without malice, doing or
failing to do an act from which material damage results by reason of inexcusable lack of precaution on the
part of the person performing or failing to perform such act, taking into consideration his employment or
occupation, degree of intelligence, physical condition and other circumstances regarding persons, time
and place.

 Picart v. Smith, 1918 – Test of negligence:

Did the defendant in doing the alleged negligent act use that reasonable care and caution which an
ordinarily prudent person would have used in the same situation? If not, then he is guilty of negligence.

1. Standard of Care

 The degree of care required to be exercised must vary with the capacity of the person endangered to care
for himself.

A HIGH degree of care and diligence is required if it involves:

a) Functions imbued with public interest, i.e. banking business;

b) Objects that are dangerous, i.e. electricity;
c) An instrumentality extremely dangerous in character, i.e. dangerous weapons or substances.

Factors to be considered. In considering negligence, the following are to be factored in:

a) Employment or occupation;
b) Degree of intelligence;
c) Physical condition;
d) Other circumstances reg persons, time, and place.

2. Presumptions of Negligence

 GR: The party relying on negligence as his cause of action has the burden of proving the existence of the
same.

XPN: In the following instances, a presumption arises that the defendant was negligent:
 Kapalaran Bus Liner v. Coronado, 1989 - If the driver was violating traffic rules and regulations at the
time of the collision.

Basco v. CA, 1993 - Common carriers are presumed to have been at fault or to have acted negligently if
the goods are lost, destroyed or deteriorated.

Pilapil v. CA, 1989 - In case of death of or injuries to passengers, the law presumes said common
carriers to be at fault or to have acted negligently.

Note: the law does not however, make the carrier an insurer of the absolute safety of its passengers.

Pantranco v. Baesa, 1989 – the finding of negligence on the part of employee gives rise to the
presumption of negligence on the part of the employer in the selection and supervision of the employee.

Associated bank v. CA, 1996 – in case of a forged indorsement of a check and the check was encashed,
the collecting bank is presumed negligent. Similarly, when the signature of the drawer is forged and, for
which reason, the check was encashed, it is the drawee bank which is presumed negligent.

 Nota bene:

Applying Art. 1734, NCC – the common carrier is not presumed negligent if the loss, destruction or
deterioration of the goods is due to any of the following causes:

a) Flood, storm, earthquake, lightning, or other natural disaster or calamity.

b) Act of the public enemy in war, whether international or civil.
c) A/O of the shipper or owner of the goods.
d) The character of the goods or defects in the packing or in the containers.
e) Order or act of competent public authority.

 Defenses in negligence cases: IMPORTANT - MEMORIZE

Prescription 4 years from the time of the commission of the act or omission (not from the
time of demand)

Fortuitous event Art. 1174, NCC – except in cases expressly specified by the law, or when it is
otherwise declared by stipulation, or when the nature of the obligation requires
the assumption of risk, no person shall be responsible for those events which
could not be foreseen or which, though foreseen, were inevitable.

Mondragon v. CA, 2005 – to exempt the obligor from liability for a breach of
an obligation by reason of a fortuitous event, the following requisites must
concur:

a) The cause of the breach of the obligation must be independent of the will of
the debtor.
b) The event must be either unforeseeable or unavoidable.
c) The event must be such as to render it impossible for the debtor to fulfill
his obligation in a normal manner; and
d) The debtor must be free from any participation in, or aggravation of the
injury to the creditor.

Assumption of risk Abrogar v. Cosmos, 2017 - The following requisites must concur:

a) The plaintiff must know that the risk is present.

b) He must further understand its nature.
c) His choice to incur it must be free and voluntary.

(In this case, the victim was hit by a car and died when he joined a
marathon)

Contributory negligence NPC v. Casionan, 2008 – Plaintiff’s contributory negligence may mitigate the
damages to be awarded.

The test of negligence is the same for the defendant and the plaintiff. The test
 is foreseeability.

There is contributory negligence when the party’s act showed lack of ordinary
case and foresight that such act could cause him harm or put his life in danger.

40% - Plaintiff

60% - Defendant

Doctrine of last clear

chance

Emergency rule Valenzuela v. CA, 1996 – under the “emergency rule” an individual who
suddenly finds himself in a situation of danger and is required to act without
much time to consider the beast means that may be adopted to avoid the
impending danger, is not guilty of negligence if he fails to be a better solution,
unless the emergency was brought by his own negligence.

(no need to show accident or fortuitous event. As long as the event is startling
or happened in split second)

Involuntariness

Accident

K. Damages (note – Hernando loves damages)

 East bank v. Pacilan, 2005 – they are the recompense or compensation awarded for the damage suffered,
that is, the loss, hurt or harm which results from the injury.

 Damages is the pecuniary compensation, recompense, or satisfaction for an injury sustained, or as

otherwise expressed, the pecuniary consequences which the law imposes for the breach of some duty or
violation of some rights.

 There is a material distinction between damages and injury. Injury is the illegal invasion of a legal right;
damage is the loss, hurt or harm which results from the injury; and damages are the recompense or
compensation awarded for the damage suffered.

1. Kinds of Damages

a) Actual and Compensatory Damages

 Sui Yong . IAC, 1990 - Actual or compensatory damages cannot be presumed, but must be duly proved,
and proved with a reasonable degree of certainty.

A court cannot rely on speculation, conjecture or guesswork as to the fact and amount of damages, but
must depend upon competent proof that they have been suffered and on evidence of actual amount
thereof.

 These are actual costs or expenses.

 Actual and compensatory damages are those recoverable because of pecuniary loss — in business, trade,
property, profession, job or occupation.

Indemnification for damages shall comprehend not only the value of the loss suffered, but also that of the
profits which the obligee failed to obtain.

To seek recovery for actual damages, it is necessary to prove with a reasonable degree of certainty,
premised upon competent proof and on the best evidence obtainable by the injured party, the actual
amount of loss. Actual or compensatory damages under the prevailing law may be classied into two.

1. One is the loss of what a person already possesses (daño emergente), and

2. the other is the failure to receive as a benefit that would have pertained to him (lucro cesante).

 Attorney’s Fees - In the absence of stipulation, attorney's fees and expenses of litigation, other than
judicial costs, cannot be recovered, except:
 1) When exemplary damages are awarded;

2) When the defendant's act or omission has compelled the plaintiff to litigate with third persons or to
incur expenses to protect his interest;
3) In criminal cases of malicious prosecution against the plaintiff.
4) In case of a clearly unfounded civil action or proceeding against the plaintiff;
5) Where the defendant acted in gross and evident bad faith in refusing to satisfy the plaintiff's plainly
valid, just and demandable claim;
6) In actions for legal support;
7) In actions for the recovery of wages of household helpers, laborers and skilled workers;
8) In actions for indemnity under workmen's compensation and employer's liability laws;
9) In a separate civil action to recover civil liability arising from a crime;
10) When at least double judicial costs are awarded;
11) In any other case where the court deems it just and equitable that attorney's fees and expenses of
litigation should be recovered.

 Art. 2216, NCC - No proof of pecuniary loss is necessary in order that moral, nominal, temperate,
liquidated or exemplary damages, may be adjudicated. The assessment of such damages, except
liquidated ones, is left to the discretion of the court, according to the circumstances of each case.

b) Moral Damages

 Moral damages are meant to enable the injured party to obtain the means, diversions or amusements in
order to alleviate the moral suffering.

 Moral damages may be awarded if the contractual breach is found to be wanton and deliberately
injurious, or if the one responsible acted fraudulently or with malice or bad faith.

The principle that, in an action for breach of contract of carriage, moral damages may be awarded only in
case

a) an accident results in the death of a passenger; or

b) the carrier is guilty of fraud or bad faith,

Is pursuant to Article 1764, in relation to Article 2206(3) of the Civil Code, and Article 2220 thereof.
(Darines v. Quiñones)

 Case law establishes the following requisites for the award of moral damages:

1) there must be an injury clearly sustained by the claimant, whether physical, mental or psychological;
2) there must be a culpable act or omission factually established;
3) the wrongful act or omission of the defendant is the proximate cause of the injury sustained by the
claimant; and
4) the award for damages is predicated on any of the cases stated in Article 2219.

 Moral damages may be recovered in the following and analogous cases:

1) A criminal offense resulting in physical injuries;

2) Quasi-delicts causing physical injuries;
3) Seduction, abduction, rape, or other lascivious acts;
4) Adultery or concubinage;
5) Illegal or arbitrary detention or arrest;
6) Illegal search;
7) Libel, slander or any other form of defamation;
8) Malicious prosecution;
9) Acts mentioned in article 309;
10) Acts and actions referred to in articles 21, 26, 27, 28, 29, 30, 32, 34, and 35.

 Rule as to Juridical Persons. — A juridical person is generally not entitled to moral damages because,
unlike a natural person, it cannot experience physical suffering or such sentiments as wounded feelings,
serious anxiety, mental anguish or moral shock. However, where the claim for moral damages falls under
item 7 of Article 2219 of the Civil Code, moral damages may be recovered. This provision expressly
authorizes the recovery of moral damages in cases of libel, slander or any other form of defamation.
Article 2219(7) does not qualify whether the plaintiff is a natural or juridical person.
  People v. Baylon, 1984 – moral damages include physical suffering, mental anguish, fright, serious
anxiety, besmirched reputation, wounded feelings, moral shock, social humiliation, and similar injury.
Though incapable of pecuniary computation, moral damages may be recovered if they are the proximate
result of defendant’s wrongful A/O.

 Prudenciado v. Alliance Transport, 1987 – moral damages, though incapable of pecuniary estimation, are
in the category of award designed to compensate the claimant for actual injury suffered and not to impose
a penalty on the wrongdoer.

 PAL v. CA, 1997 – Moral damages are not intended to enrich a plaintiff at the expense of the defendant.
They are awarded only to allow the former to obtain means, diversion or amusements that will serve to
alleviate the moral suffering he has undergone due to the defendant’s culpable action and must, perforce,
be proportional to the suffering inflicted.

 Republic v. Tuvera, 2007 – a juridical person is not entitled to moral damages under Art. 2217 of NCC. It
may avail moral damages under the analogous cases listed in Art. 2219, such as for libel, slander or any
other form of defamation.

 Philtranco services v. Paras, 2012 – As a general rule, moral damages are not recoverable in an action
predicated on a breach of contract. This is because such action is not included in Art. 2219 of NCC as one
fo the actions in which moral damages may be covered.

By way of exception, moral damages are recoverable in an action predicated on a breach of contract:

a) Where the mishap results in the death of a passenger, as provided under Art. 1746 in relation to Art.
2206 (3) of NCC; and
b) Where the common carrier has been guilty of fraud or bad faith, as provided under Art. 2220 of NCC.

c) Nominal Damages

 Nominal damages are recoverable where a legal right is technically violated and must be vindicated
against an invasion that has produced no actual present loss of any kind or where there has been a breach
of contract and no substantial injury or actual damages whatsoever have been or can be shown. (Seven
Brothers v. DMC Construction)

 Cogeo-Cubao Operators and Drivers Association v. CA, 1992 – the court may award nominal damages in
every obligation arising from any source enumerated in Art. 1157, or in every case where any property
right has been invaded.

 Citytrust Bank v. IAC, 1994 – is it wrong to award, along with nominal damages, temperate or moderate
damages.

The two awards are incompatible and cannot be granted concurrently. Nominal damages are given 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 .

Note: Nominal damages is awarded only when there is violation of a property rights.

Note: Nominal damages cannot be awarded concurrently with any other damages.

d) Temperate or Moderate Damages

 Temperate damages in lieu of actual damages for loss of earning capacity may be awarded where earning
capacity is plainly established but no evidence was presented to support the allegation of the injured
party's actual income.

It is wrong to award, along with nominal damages, temperate or moderate damages. The two awards are
incompatible and cannot be granted concurrently.

 Premiere Development Banks v. CA, 2004 – when the court finds that some pecuniary loss has been
suffered but the amount cannot, from the nature of the case, be proed with certainty, temperate damages
may be recovered.

Temperate damages may be allowed in cases where from the nature of the case, definite proof of
pecuniary loss cannot be adduced, although the court is convinced that the aggrieved party suffered some
pecuniary loss.

 Barzaga v. CA, 1997 – The record however does not show that petitioner presented proof of the actual
amount of expenses he incurred which seems to be the reason the trial court awarded to him temperate
 damages instead.

This is an erroneous application of the concept of temperate damages. While petitioner may have indeed
suffered pecuniary losses, these by their very nature could be established with certainty by means of
payment receipts. As such, the claim falls unequivocally within the realm of actual or compensatory
damages.

 Note: Temperate damages cannot be awarded concurrently with actual damages.

 Note: Example – transportation costs for therapy clinic – temperate damages may be awarded since there
can be no receipt presented if the offended party rode tricycle on his way to the clinic.

e) Liquidated Damages

 Liquidated damages are those agreed upon by the parties to a contract, to be paid in case of breach
thereof. When the breach of the contract committed by the defendant is not the one contemplated by the
parties in agreeing upon the liquidated damages, the law shall determine the measure of damages, and
not the stipulation.

 Menchavez v. Teves, 2005 – liquidated damages are those agreed upon by the parties to a contract, to be
paid in case of a breach thereof. Liquidated damages are identical to penalty insofar as legal results are
concerned.

Intended to ensure the performance of the principal obligation, such damages are accessory and
subsidiary obligations. Since the principal obligation was void, there was no contract that could have been
breached by the petitioners; thus, the stipulation on liquidated damages was inexistent. The nullity of the
principal obligation carried with it the nullity of the accessory obligation of liquidated damages.

 In lieu of all damages. However, if the party waives claim for liquidated damages, it gives way for the court
to award other types of damages.

f) Exemplary or Corrective Damages

 Exemplary damages are designed to permit the courts to reshape behavior that is socially deleterious in its
consequence by creating negative incentives or deterrents against such behavior.

 Requisites:

1. May be imposed as way of example in addition to compensatory damages, and only after the claimant’s
right to them has been established

2. Cannot be recovered as a matter of right, always based on amount of compensatory damages;

3. The act must be accompanied by bad faith, or done in wanton, fraudulent, oppressive or malevolent
manner.

 Maersk Line v. CA, 1993 – in contracts, exemplary damages may be awarded if the defendant acted in a
wanton, fraudulent, reckless, oppressive or malevolent manner.

 Lozano v. Ballesteros, 1991 – Exemplary damages may be imposed by way of example or correction only
in addition among others, to actual or compensatory damages, but they cannot be recovered as a matter of
right, their determination depending upon the discretion of the court. In the absence of any claim and
proof of compensatory damages, the award of exemplary damages has no leg to stand on.

 Note: Every moral damages carries with it award of exemplary damages.

2. When Damages May be Recovered

 Damages may be recovered:

1) For loss or impairment of earning capacity in cases of temporary or permanent personal injury;
2) For injury to the plaintiff's business standing or commercial credit.

 Grounds for mitigating or reducing amount of damages – Art. 2215, NCC:

a) The plaintiff’s negligence contributed to the damage.

b) The plaintiff himself has contravened the terms of the contract.
c) The plaintiff has derived some benefit as a result of the contract.
d) In cases where exemplary damages are to be awarded, that the defendant acted upon the advice of
counsel.
e) The loss would have resulted in any event.
 f) Since the filing of the action, the defendant has done his best to lessen the plaintiff’s loss or injury.

L. Damages in Case of Death

 UCPB v. Leporgo, 2011 – Civil or death indemnity is mandatory and granted to the heirs of the victim
without need of proof other than the fact of death as the result of the crime or quasi-delict.

Initially fixed by the Civil Code at P3,000.00, the amount of indemnity is currently fixed at P75,000.00.
(in plethora of cases decided in 2017, death indemnity was increased to P75,000.00)

In addition, the defendant shall be liable for loss of the earning capacity of the deceased. Compensation of
this nature is awarded not for loss of earnings, but for loss of capacity to earn money. The liability for the
loss of the earning capacity of the deceased is fixed by taking into account the net income of the victim at
the time of death --- of the incident in this case --- and that person’s probable life expectancy.

 Loss of earning capacity – Pleyto v. Lomboy, 2004:

The following factors should be taken into account in determining the compensable amount of lost
earnings are:

a) The number of years for which the victim would otherwise have lived; and
b) The rate of loss sustained by the heirs of the deceased.

Thus, formula used by this court in computing loss of earning capacity is:

Net earning capacity = [2/3 x (80-age at the time of death) x (gross annual income – reasonable and
necessary living expenses)]

M. Duty of Injured Party

 Article 2203, Civil Code. The party suffering loss or injury must exercise the diligence of a good father
of a family to minimize the damages resulting from the act or omission in question.

 Chua v. Colorite Marketing Corporation - This clearly obligates the injured party to undertake measures
that will alleviate and not aggravate his condition after the infliction of the injury, and places upon him
the burden of explaining why he could not do so.

 Lim v. CA - One who is injured by the wrongful or negligent act of another should exercise reasonable care
and diligence to minimize the resulting damage. Anyway, he can recover from the wrongdoer money lost
in reasonable efforts to preserve the property injured and for injuries incurred in attempting to prevent
damage to it.

[Concerning damage to property,] it is the burden of [the tortfeasor] to show satisfactorily not only that
the injured party could have mitigated his damages but also the amount thereof; failing in this regard, the
amount of damages awarded cannot be proportionately reduced.

Principle: A party cannot recover damages flowing from consequences which the party could have reasonably
avoided.