2023 Jurists Pre Bar Notes in Civil Law

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2023 Jurists Pre-bar Notes in Civil Law. For the exclusive use of Jurists Bar reviewees. © 2023 by Jurists Review
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PERSONS AND FAMILY RELATIONS

I. PERSONS
A. When Law Takes Effect Doctrine
B. Ignorance of the Law
C. Retroactivity of Laws
D. Mandatory or Prohibitory Laws
E. Waiver of Rights
F. Presumption and Applicability of Custom
G. Legal Periods
H. Territoriality Principle
I. Conflict of Laws
1. Lex Nationalii
2. Lex Rei Sitae
3. Lex Loci Celebrationis
4. Doctrine of Renvoi
J. Human Relations in Relation to Persons
K. Capacity to Act
1. Restrictions on Capacity to Act
2. Birth and Death of Natural Persons
3. Presumption of Survivorship
L. Surnames
M. Rules Governing Persons Who are Absent
II. MARRIAGE
A. General Principles
1. Essential Requisites
2. Formal Requisites
B. Mixed Marriages & Foreign Divorce
C. Void Marriages (See Tan-Andal v. Andal, G.R.
No. 196359, May 11, 2021)
D. Voidable Marriages
E. Effect of Defective Marriages
F. Foreign Marriages
G. Legal Separation
H. Property Relations Between Spouses
1. Donation Propter Nuptias
2. Void Donations by the Spouses
3. Absolute Community of Property Regime
4. Conjugal Partnership of Gains Regime
5. Separation of Property Regime
6. Property Regime of Unions Without
Marriage
7. Judicial Separation of Property
I. The Family
1. General Principles
J. The Family Home
K. Paternity and Filiation

1. Concepts of Paternity, Filiation, and
Legitimacy
2. Legitimate Children
a) Who are Legitimate Children
b) Proof of Filiation of Legitimate
Children
c) Rights of Legitimate Children
d) Grounds to Impugn Legitimacy
3. Illegitimate Children
a) Who are Illegitimate Children
b) Proof of Filiation of Illegitimate
Children
c) Rights of Illegitimate Children
d) Grounds to Impugn Filiation
4. Legitimated Children
a) Who may be Legitimated
b) How Legitimation Takes Place
c) Grounds to Impugn Legitimacy
5. Adopted Children
a) Domestic Administrative Adoption
and Alternative Child Care Act (RA
11642)
b) Who May Adopt
c) Who May be Adopted
d) Effects of a Decree of Adoption (See
Article Nos. 189-190 of the Family
Code)
L. Support
1. What Comprises Support
2. Who are Obligated to Give Support
3. Source of Support
4. Order of Support
M. Parental Authority
1. Concept of Parental Authority
2. Substitute Parental Authority
3. Special Parental Authority
4. Effects of Parental Authority
PROPERTY, OWNERSHIP, AND ITS

MODIFICATIONS
I. CLASSIFICATION OF PROPERTY
A. Immovables
B. Movables
II. BUNDLE OF RIGHTS

A. Ownership
B. Rights of Accession
2. Accession Industrial
3. Accession Natural
C. Actions to Recover Ownership and Possession
of Property
1. Accion Reivindicatoria
2. Accion Publiciana
3. Accion Interdictal
4. Quieting of Title
D. Co-Ownership
1. Distinction Between Right to Property
Owned in Common and Full Ownership
Over the ideal Share
2. Contributions for Expenses
3. Redemption
4. Partition
E. Possession
1. Possession in the Concept of a Holder
2. Possession in the Concept of an Owner
3. Relevance of Good Faith and Bad Faith
4. Rules for Movables
F. Usufruct
1. Rights and Obligations of Usufructuary
2. Classes of Usufruct
3. Extinguishment of the Usufruct
G. Easements
1. Characteristics
2. Kinds of Easements
3. Modes of Acquiring Easements
4. Effects of Easement
5. Extinguishment of Easements
III.DIFFERENT MODES OF ACQUIRING

OWNERSHIP
A. Occupation
B. Tradition
C. Donation
1. Features
2. Classifications
3. Distinctions Between Mortis Causa and
Inter Vivos Donations
4. Form
5. Limitations
6. Reduction and Revocation
D. Prescription
1. Distinction Between Acquisitive and
Extinctive Prescription
2. Distinctions Between Extinctive
Prescription and Laches
IV.LAND TITLES AND DEEDS

A. Torrens System
B. Regalian Doctrine
C. Nationality Restrictions on Land Ownership
D. Original Registration (PD 1529)
1. Who May Apply
2. Decree of Registration
3. Preview of Decree of Registration;
Innocent Purchaser for Value (IPV); Rights
of IPV
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
G. Subsequent Registration
1. Voluntary Dealings
2. Involuntary Dealings
a) Adverse Claims
b) Notice of Lis Pendens
H. Non-Registrable Properties
I. Dealings With Unregistered Lands
J. Assurance Fund
1. Nature of Assurance Fund
2. Conditions for Compensation from
Assurance Fund
3. Prescriptive Period
K. Reconstitution of Title
V. WILLS AND SUCCESSION

A. General Provisions
B. Testamentary Succession
1. General Provisions
2. Characteristics of a Will
3. Non-Delegability of a Testamentary Power
4. Applicable Law as to Form and Substance
of a Will
5. Testamentary Capacity
6. Form of Notarial and Holographic Wills
7. Witnesses to a Notarial Will (Qualification
and Disqualifications)
8. Conflict Rules
9. Modes of Revocation of Wills and
Testamentary Dispositions
a) Effect on the Recognition of a Non-
Marital Child
b)
Theory of Dependent Relative
Revocation
c) Revocation Based on a False Cause
10. Heirs
a) Compulsory Heirs
b) Institution of Heirs
(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
11. Legitime
a) Collation in Connection With the
Computation of Legitime
b) Table of Legitime
c) Impairment of the Legitime
d) Presumptive Legitime
12. Preterition
a) Requisites
b) Governing Law
13. Conditional Dispositions and Dispositions
a) Condition Not to Marry
b) Disposicion Captatoria
c) Modal Institution
14. Void Testamentary Dispositions
15. Disinheritance
a) Grounds for Disinheritance
b) Requisites for the Various Grounds for
Disinheritance
c) Effects of Reconciliation
16. Legacies and Devises
a) Requisites for Validity
b) Property Not Owned by the Testator
c) Ineffective Legacies/Devises
C. Intestate Succession
1. Relationship
2. Causes of Intestacy
3. Order of Intestate Succession
4. Rule of Proximity and Rule of Equality
a) Exceptions to the Rule of Proximity
and Rule of Equality
5. Determination of Heirs
6. Successional Barrier (the “Iron Curtain
Rule”) (See Aquino v. Aquino, G.R. Nos.
208912 and 209018, December 7, 2021)
7. Successional Rights of Adopted Children
8. Successional Rights of Adopting Parents
9. Successional Rights of Marital and Non-

Marital Children
10. Successional Rights of the Surviving
Spouse
11. Successional Rights of Collateral
Relatives
D. Provisions Common to Testate and Intestate
Succession
1. Capacity to Succeed
a) Incapacity by Reason of Unworthiness
and Effects of Condonation
b) Incapacity by Reason of Morality
c) Incapacity by Reason of Possible
Undue Influence
2. Right of Representation in Testacy and
Intestacy
a) Requisites and Limitations
3. Right of Accretion in Testamentary
Succession and in Intestacy
a) Requisites and Limitations
4. Acceptance and Repudiation of
Inheritance
a) Form of Repudiation
b) Effects of Repudiation Compared to
Predecease and Incapacity
OBLIGATIONS AND CONTRACTS

I. OBLIGATIONS
1. Definition
2. Essential Elements
3. Sources of Obligation
B. Nature and Effects of Obligations
1. Breaches of Obligations
2. Remedies for Breach of Obligation
C. Different Kinds of Obligations
D. Extinguishment of Obligations
1. Payment
a) Concept of Payment
b) Payment by Cession vs. Dation in
Payment
c) Tender of Payment and Consignation
2. Loss of the Thing Due
a) Concept of Loss
b) Requisites
c) Force Majeure
3. Condonation
4. Confusion
5. Compensation
a) Requisites
b) Compensation of Rescissible and
Voidable Debts
c) Non-Compensable Debts
6. Novation
a) Concept of Novation
b) Expressed and Implied Novation
(1) Requisites
c) Expromision and Delegacion
Distinguished
(1) Consent Required
(2) Effect of Insolvency of New Debtor
d) Legal and Conventional Subrogation
II. CONTRACTS
1. Definition of a Contract
2. Elements of a Contract
a) Essential elements
b) Natural Elements
B. Basic Principle 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
2. Object
3. Cause or Consideration
D. Defective Contracts
1. Rescissible Contracts
2. Voidable Contracts
3. Unenforceable Contracts
4. Void Contracts
III. NATURAL OBLIGATIONS
SPECIAL CONTRACTS
I. SALES
A. Definition and Essential Requisites
B. Contract of Sale
1. Contract to Sell
2. Option Contract
3. Right of First Refusal
C. Earnest Money
D. Double Sales
E. Risk of Loss
F. Breach of Contract of Sale
1. Recto Law
2. Maceda Law
G. Extinguishment of the Sale
1. Conventional Redemption
2. Legal Redemption
H. Equitable Mortgage
I. Pacto de Retro Sales
II. LEASE
A. Kinds of Lease
B. Rights and Obligations of Lessor
C. Rights and Obligations of Lessee
III. AGENCY
IV. CREDIT TRANSACTIONS

A. Loans
B. Deposit
C. Guaranty and Suretyship
D. Real Estate Mortgage
E. Antichresis
V. COMPROMISE
VI. QUASI-CONTRACTS
A. Negotiorum Gestio
B. Solutio Indebiti
VII.TORTS AND DAMAGES

A. Principles
1. Abuse of Rights
2. Unjust Enrichment
3. Liability Without Fault
4. Acts Contrary to Law
5. Acts Contrary to Morals
B. Classifications of Torts
1. Intentional
2. Negligent
3. Strict Liability
C. The Tortfeasor
1. Joint
2. Direct
D. Quasi-Delict vs. Culpa Contractual vs. Culpa
Criminal
1. Nature of Liability
E. Proximate Cause
1. Concept
2. Doctrine of Last Clear Chance
F. Vicarious Liability
G. Res Ipsa Loquitur
H. Damnum Absque Injuria
I. Defenses
J. Negligence
1. Standard of Care
2. Presumption of Negligence
K. Damages
1. Kinds of Damages
2. When Damages May be Recovered
L. Damages in Case of Death
M. Duty of Injured Party
x----------------------------------------------------------------------x
PERSONS AND FAMILY RELATIONS

I. PERSONS
A. When Law Takes Effect Doctrine H. Territoriality Principle
B. Ignorance of the Law I. Conflict of Laws
C. Retroactivity of Laws J. Human Relations in Relation to Persons
D. Mandatory or Prohibitory Laws K. Capacity to Act
E. Waiver of Rights L. Surnames
F. Presumption and Applicability of Custom M. Rules Governing Persons Who are
G. Legal Periods Absent
H. Territoriality Principle
I. Conflict of Laws
A. WHEN LAW TAKES EFFECT - Publication must be in full or it is no

publication at all, since its purpose is to
DOCTRINE inform the public of the contents of the laws.
Laws shall take effect after fifteen days following - The term "laws" should refer to all laws and
the completion of their publication in the Official not only to those of general application, for
Gazette or in a newspaper of general circulation in strictly speaking all laws relate to the people
the Philippines, unless it is otherwise provided. in general albeit there are some that do not
This Code shall take effect one year after such apply to them directly.
publication. (Art. 2, NCC, as amended by E.O
200) When publication is required
• Publication is indispensable in every case, 1. All laws
but the legislature may in its discretion 2. Presidential decrees and executive orders
provide that the usual fifteen-day period shall promulgated by the President
be shortened or extended. 3. Administrative rules and regulations must
• If the law provides for a different period also be published if their purpose is to
shorter or longer than the fifteen-day period, enforce or implement existing law pursuant
then such shorter or longer period, as the to a valid delegation.
case may be, will prevail. 4. Circulars issued by the Monetary Board must
• If the law provides that it shall take effect be published if they are meant not merely to
immediately, it shall take effect immediately interpret but to "fill in the details" of the
after publication with the fifteen-day period Central Bank Act which that body is
being dispensed with. supposed to enforce. (Tañada vs. Tuvera,
G.R. No. L-63915 December 29, 1986)
Illustration :
• Circulars and regulations, especially like
An example is the Civil Code which did not
the Circular No. 20 of the Central Bank in
become effective after fifteen days from its
question, which prescribes a penalty for
publication in the Official Gazette but "one year
after such publication." The general rule did not
its violation should be published before
apply because it was "otherwise provided.” becoming effective, this, on the general
• When a statute does not explicitly provide for principle and theory that before the public
its effectivity, it shall have effect only after the is bound by its contents, especially its
expiration of the fifteen-day period following penal provisions, a law, regulation or
the completion of its publication either in the circular must first be published and the
Official Gazette or in a newspaper of general people officially and specifically informed
circulation in the Philippines. of said contents and its penalties. (People
• Publication is intended to enable the people vs. Que Po Lay, G.R. No. L-6791, March
to become familiar with the statute. No one 29, 1954)
shall be charged with notice of the statute’s
provision until the said publication. When publication is not required
1. Interpretative regulations and those merely
TAÑADA V. TUVERA | G.R. No. L-63915 April internal in nature
24, 1985 2. Letters of instructions issued by
- It is not correct to say that under the disputed administrative superiors concerning the rules
clause (“unless otherwise provided”) or guidelines to be followed by their
publication may be dispensed with altogether. subordinates in the performance of their
The reason is that such omission would duties.
offend due process insofar as it would deny 3. Municipal ordinances are not covered by
the public knowledge of the laws that are Article 2 of the Civil Code but by the Local
supposed to govern it. Government Code.
B. IGNORANCE OF THE LAW E. WAIVER OF RIGHTS
Art. 3. Ignorance of the law excuses no one Art. 6. Rights may be waived, unless the
from compliance therewith. waiver is contrary to law, public order, public
policy, morals, or good customs, or
Ignorance of the law or ignorantia legis prejudicial to a third person with a right
neminem excusat recognized by law.
• If there is valid publication pursuant to
Article 2 NCC, the law becomes effective General Rule:
and no one can interpose the defense of Rights may be waived
ignorance. If there is no valid publication,
ignorance is a defense. Exception: unless the waiver is contrary to
• A legal principle holding that a person who law, public order, public policy, morals, or
is unaware of a law may not escape good customs, or prejudicial to a third
liability for violating that law merely person with a right recognized by law.
because one was unaware of its content. • Person must have capacity to waive
• Right must be vested and existing at the
C. RETROACTIVITY OF LAWS time of waiver
• Waiver is clear and unequivocal
Art. 4. Laws shall have no retroactive effect, • Compliance with formalities if required
unless the contrary is provided.
F. PRESUMPTION AND
Exceptions: APPLICABILITY OF CUSTOM
• When the law itself expressly provides for
its retroactivity; Article 10. In case of doubt in the
• When the law is penal insofar as it favors interpretation or application of laws, it is
the accused, provided that the accused is presumed that the lawmaking body
not a habitual delinquent (Art 22 RPC); intended right and justice to prevail.
• When the law is procedural so long as it
does not affect or change vested rights;
Article 11. Customs which are contrary to
• When the law creates new substantive
law, public order or public policy shall not
rights;
be countenanced.
• When the law is interpretative of other
laws;
Article 12. A custom must be proved as a
fact, according to the rules of evidence.
Limitations on Retroactivity
1. Ex post facto law ‘Custom’ defined
2. Laws that impair obligations and - juridical rule which results from a
contracts constant and continued uniform practice
3. Laws that prejudice vested rights by the members of social community, with
respect to a particular state of facts, and
D. MANDATORY OR observed with a conviction that it is
PROHIBITORY LAWS juridically obligatory.
Art. 5. Acts executed against the provisions Requisites before the Courts can
of mandatory or prohibitory laws shall be consider Customs
void, except when the law itself authorizes 1. It must be proved as a fact
their validity 2. Plurality and Uniformity of acts
3. General practice by a great mass of
Acts executed against the provisions of
people
mandatory or prohibitory laws shall be void,
4. Continued practice for a long period of
except when the law itself authorizes their
time
validity.
5. General conviction that the practice is
OR
• Voidable the proper rule of conduct
• Valid but penalizes violator 6. Conformity with law, morals or public
• Unenforceable policy
• Void but recognizes legal effect
G. LEGAL PERIODS Conflict of Laws v. International Laws
Art. 13. When the laws speak of years, CONFLICT INTERNATIONAL

BASIS
months, days or nights, it shall be OF LAWS LAW
understood that years are of three hundred
Nature Municipal International
sixty-five days each; months, of thirty days;
days, of twenty-four hours; and nights from Dealt with by
sunset to sunrise. private Sovereign states
individuals; and other entities
If months are designated by their name, governs possessing
they shall be computed by the number of individuals in international
Persons
their private personality, e.g.,
days which they respectively have. Involved
UN; governs states
transactions
which in their relationships
In computing a period, the first day shall be involve a amongst
excluded, and the last day included. foreign themselves
element
YEAR
Private Generally affected
Transactions
- twelve (12) calendar months (Revised

Involved
transactions by public interest;
Administrative Code; Lex posteriori derogat between those in general are
priori; Commissioner of Internal Revenue v. private of interest only to
Primetown Property Group, Inc., 558 Phil. individuals sovereign states
182, 190, 2007)
May be peaceful or
forcible
MONTHS Peaceful: includes
- thirty (30) days; unless months are diplomatic
designated their name. If designated by negotiation, tender
their name, it shall be computed by the & exercise of good
number of days which they respectively offices, mediation,
have. inquiry &
Remedies and Sanctions
conciliation,
arbitration, judicial
DAYS
settlement by ICJ,
- 24 hours; Resort to
reference to
- Nights from sunset to sunrise. municipal
regional agencies
- In computing a period, the first day is tribunals
excluded, and the last day included. Forcible: includes
severance of
H. TERRITORIALITY PRINCIPLE diplomatic relations,
retorsions, reprisals,
Art. 14. Penal laws and those of public embargo, boycott,
non-intercourse,
security and safety shall be obligatory upon
pacific blockades,
all who live or sojourn in the Philippine collective measures
territory, subject to the principles of public under the UN
international law and to treaty stipulations. Charter, and war
- Article 14 refers to principle of Generality
of penal laws 1. LEX NATIONALII (ART. 15)
- Territoriality Principle - penal laws are - Also known as the Nationality Principle
enforceable only within the Philippine - refers to the law of the nationality of the
territory. person which determines his family rights
and duties, status, condition, and legal
I. CONFLICT OF LAWS capacity.
That part of the law of each state or nation Art. 15. Laws relating to family rights and
which determines whether, in dealing with a duties, or to the status, condition and legal
legal situation involving a foreign element, capacity of persons are binding upon
the law of some other state or nation will be citizens of the Philippines, even though
recognized, given effect, or applied. living abroad.
2. LEX REI SITAE (ART. 16) 4. DOCTRINE OF RENVOI

- It is Latin for "the law where the property is • Renvoi takes place when the conflicts rule of
situated". the forum makes a reference to a foreign law,
- is a legal doctrine of property law and of but the foreign law is found to contain a
private international law which states that conflict rule that returns or refers the matter
property is governed by the law of the place back to the law of the forum (Remission) or a
where it is situated third state (Transmission).
- 1st par of Art 16 is lex rei sitae • doctrine whereby a jural matter is presented
- 2nd par of Art 16 is lex nationalii - the which the conflict of laws rules of the forum
national law of the decedent shall govern refer to a foreign law which in turn, refers the
the order of succession, amount of matter back to the law of the forum or a third
successional rights and intrinsic validity of state.
• The recognition of the renvoi theory implies
testamentary provision in both testate and
that the rules of the conflict of laws are to be
intestate successions
understood as incorporating not only the
ordinary or internal law of the foreign state or
Art. 16. Real property as well as personal country, but its rules of the conflict of laws as
property is subject to the law of the country well. Consequently, the court of the domicile
where it is situated. cannot and should not refer the case back to
California; such action would leave the issue
However, intestate and testamentary incapable of determination because the case
successions, both with respect to the order of will then be like a football, tossed back and
succession and to the amount of successional forth between the two states, between the
rights and to the intrinsic validity of country in which the decedent was a citizen
testamentary provisions, shall be regulated by and the country of his domicile. The
the national law of the person whose Philippine court must apply its own law as
succession is under consideration, whatever directed in the conflict of laws rule of the state
may be the nature of the property and of the decedent. (Aznar vs. Garcia, G.R. No.
regardless of the country wherein said L-16749, January 31, 1963)
property may be found
J. HUMAN RELATIONS IN
3. LEX LOCI CELEBRATIONIS (ART. 17) RELATION TO PERSONS
- law of the place where the contract is
made. Art. 19. Every person must, in the exercise of
- roughly translated as "the law of the land his rights and in the performance of his duties,
(lex loci) where the contract was act with justice, give everyone his due, and
observe honesty and good faith.
celebrated“
- a conflict of law principle that comes into
Art. 20. Every person who, contrary to law,
play when there are issues on the forms
willfully or negligently causes damage to
and solemnities of a contract that is another, shall indemnify the latter for the same.
celebrated elsewhere than the place of
citizenship of the parties. Art. 21. Any person who wilfully causes loss or
injury to another in manner that is contrary to
Art. 17. The forms and solemnities of morals, good customs or public policy shall
contracts, wills, and other public instruments compensate the latter for the damage.
shall be governed by the laws of the country in
which they are executed. INJURY V. DAMAGE
When the acts referred to are executed before Injury Damage

the diplomatic or consular officials of the
is the illegal is the loss, hurt, or harm
Republic of the Philippines in a foreign invasion of a which results from the injury
country, the solemnities established by legal right
Philippine laws shall be observed in their Different from DAMAGES
execution. which are the recompense or
compensation awarded for
Prohibitive laws concerning persons, their acts the damage suffered.
or property, and those which have for their
object public order, public policy and good There can be damage without injury in those
customs shall not be rendered ineffective by instances in which the loss or harm was not the
laws or judgments promulgated, or by result of a violation of a legal duty. In such
determinations or conventions agreed upon in cases, the consequences must be borne by the
a foreign country. injured person alone.
14
Doctrine of Damnum Absque Injuria - There is a common element under Articles

It means damage without injury. One who 19 and 21, and that is, the act must be
merely exercises one’s rights does no actionable intentional. However, Article 20 does not
injury and cannot be held liable for damages. distinguish: the act may be done either
"willfully", or "negligently". (Albenson
Principle of Abuse of Rights Enterprises Corp. v. CA, G.R. No. 88694
• Article 19, known to contain what is January 11, 1993)
commonly referred to as the principle of
abuse of rights, sets certain standards which Note: When Article 19 is violated, an action for
may be observed not only in the exercise of damages is proper under Articles 20 or 21 of
one’s rights but also in the performance of the Civil Code.
one’s duties.
• These standards are the following: to act with BUÑAG VS. CA | G.R. NO. 101749 JULY 10,
justice; to give everyone his due; and to 1992)
observe honesty and good faith. Article 21 was adopted to remedy the countless
• The law, therefore, recognizes the primordial gaps in the statutes which leave so many
limitation on all rights: that in their exercise, victims of moral wrongs helpless even though
the norms of human conduct set forth in they have actually suffered material and moral
Article 19 must be observed. injury, and is intended to vouchsafe adequate
• A right, though by itself legal because legal remedy for that untold number of moral
recognized or granted by law as such, may wrongs which is impossible for human foresight
nevertheless become the source of some to specifically provide for in the statutes.
illegality. When a right is exercised in a
manner which does not conform with norms
Breach of Promise to Marry
enshrined in Article 19 and results in damage
Breach of promise to marry per se is not an
to another, a legal wrong is thereby
actionable wrong.
committed for which the wrongdoer must be
held responsible x x x.” (Albenson Enterprises
Instances where SC awarded damages:
Corp. v. CA, G.R. No. 88694 January 11,
• Seduction
1993)
• Act constitutes tort in the sense that it is
wilful and that it is contrary to morals, good
Elements of Abuse of Rights (ART. 19)
• Legal right or duty;
customs or public policy, or in that there is
• The right or duty is exercised in bad faith; an abuse of rights.
and • Expenses were incurred upon the faith of
• For the sole intent of prejudicing or injuring the promise to marry.
another.
ACCION IN REM VERSO (ART. 22)
NOTE: When Article 19 is violated, an action for Every person who through an act of
damages is proper under Articles 20 or 21 of the performance by another, or any other means,
Civil Code. acquires or comes into possession of
something at the expense of the latter without
• Article 20 speaks of the general sanction for just or legal ground, shall return the same to
all other provisions of law which do not him.
especially provide for their own sanction. xxx  It is the remedy for unjust enrichment.
Thus, anyone who, whether willfully or  It is an action for recovery of what has been
negligently, in the exercise of his legal right or paid or delivered without just cause or legal
duty, causes damage to another, shall ground.
indemnify his victim for injuries suffered  If a person acquires or comes into
thereby. possession of something at the expense of
• Article 21 deals with acts contra bonus mores, another without just or legal ground through
and has the following elements: an act or of performance by another or any
(1) There is an act which is legal; other means has the obligation to return the
(2) Such act is contrary to morals, good same.
custom, public order, or public policy;
and, Requisites:
(3) It is done with intent to injure. • The defendant has been enriched;
• The plaintiff has suffered a loss;
- Thus, under any of these three (3) provisions • The enrichment of the defendant is without
of law, an act which causes injury to another just or legal ground; and
may be made the basis for an award of • The plaintiff has no other action based on
damages. contract, quasi-contract, crime or quasi-
delict.
STRICT LIABILITY LIABILITY FOR UNJUST REFUSAL TO

 Art. 23. Even when an act or event causing PERFORM DUTIES
damage to another’s property was not due to Art. 27. Any person suffering material or moral
the fault or negligence of the defendant, the loss because a public servant or employee
latter shall be liable for indemnity if through the refuses or neglects, without just cause, to perform
act or event he was benefited. his official duty may file an action for damages
and other relief against the latter, without
Doctrine of Strict Liability prejudice to any disciplinary administrative action
• Even when an act or event causing damage to that may be taken.
another’s property was not due to the fault or
negligence of the defendant, the latter shall be UNFAIR COMPETITION
liable for indemnity if through the act or event ART. 28. Unfair competition in agricultural,
he was benefited. commercial or industrial enterprises or in labor
• This precept is known as strict liability because through the use of force, intimidation, deceit,
of the lack of fault or negligence of the machination or any other unjust, oppressive or
defendant. highhanded method shall give rise to a right of
action by the person who thereby suffers damage.
COURT VIGILANCE
Art. 24. In all contractual, property or other CIVIL ACTION EX DELICTO DESPITE
relations, when one of the parties is at a ACQUITTAL
disadvantage on account of his moral ART. 29. When the accused in a criminal
dependence, ignorance, indigence, mental prosecution is acquitted on the ground that his
weakness, tender age or other handicap, the guilt has not been proved beyond reasonable
courts must be vigilant for his protection. doubt, a civil action for damages for the same act
• The courts must render justice and, therefore, or omission may be instituted. Such action
they must be very vigilant in protecting the requires only a preponderance of evidence. Upon
rights of the disadvantaged with the end in view motion of the defendant, the court may require the
that any decision will be in consonance with plaintiff to file a bond to answer for damages in
what is right and legal case the complaint should be found to be
malicious.
'PARENS PATRIAE'
If in a criminal case the judgment of acquittal is
-the sovereign power of the State in safeguarding
based upon reasonable doubt, the court shall so
the rights of person under disability; the
declare. In the absence of any declaration to that
government is the legal protector of citizens who
effect, it may be inferred from the text of the
are unable to protect themselves.
decision whether or not the acquittal is due to that
ground.
THOUGHTLESS EXTRAVAGANCE
ART. 25. Thoughtless extravagance in expenses
CIVIL ACTION EX DELICTO WITHOUT
for pleasure or display during a period of acute
CRIMINAL PROCEEDINGS
public want or emergency may be stopped by
ART. 30. When a separate civil action is brought
order of the courts at the instance of any
to demand civil liability arising from a criminal
government or private charitable institution.
offense, and no criminal proceedings are instituted
DUTY TO RESPECT NEIGHBOR’S DIGNITY, during the pendency of the civil case, a
PERSONALITY, PRIVACY AND PEACE OF preponderance of evidence shall likewise be
MIND sufficient to prove the act complained of.
Art. 26. Every person shall respect the dignity,
personality, privacy and peace of mind of his Explanations in Article 29 and 30
neighbors and other persons. The following and • Article 29. Acquittal based on reasonable
similar acts, though they may not constitute a doubt, a civil action for damages for the same
criminal offense, shall produce a cause of action act or omission may be instituted.
for damages, prevention and other relief: • Article 30. civil case ex delicto preponderance
(1) Prying into the privacy of another's residence; of evidence shall likewise be sufficient to prove
(2) Meddling with or disturbing the private life or the act complained of.
family relations of another;
(3) Intriguing to cause another to be alienated Proof Beyond Reasonable Doubt - amount of
from his friends; proof which forms an abiding moral certainty that
(4) Vexing or humiliating another on account of his the accused committed the crime charged. It is
religious beliefs, lowly station in life, place of not, therefore, absolute certainty.
birth, physical defect, or other personal
condition. Preponderance of evidence - In civil cases, the
party having the burden of proof must establish
Remedies his case by preponderance of evidence,18 which
1. Action for damages means evidence which is of greater weight, or
2. Action for prevention more convincing than that which is offered in
3. Other relief opposition to it.
INDEPENDENT CIVIL ACTION (14) The right to be a free from involuntary

An independent civil action is one that is brought servitude in any form;
distinctly and separately from a criminal case (15) The right of the accused against excessive
allowed for considerations of public policy, bail;
because the proof needed for civil cases is (16) The right of the accused to be heard by
LESS than that required for criminal cases; but himself and counsel, to be informed of the nature
with the injunction in general that success in and cause of the accusation against him, to have
financially recovering in one case should prevent a speedy and public trial, to meet the witnesses
a recovery of damages in the other. face to face, and to have compulsory process to
secure the attendance of witness in his behalf;
Articles 31, 32, 33 34, and 2176 are (17) Freedom from being compelled to be a
independent civil actions witness against one's self, or from being forced to
confess guilt, or from being induced by a promise
Civil action may be brought by the offended
of immunity or reward to make such confession,
party separate from the criminal case and shall
except when the person confessing becomes a
proceed independently of the criminal action,
State witness;
requiring only preponderance of evidence.
(18) Freedom from excessive fines, or cruel and
a. Art. 31 – not based on delict (culpa
unusual punishment, unless the same is imposed
contractual/ culpa aquiliana) or inflicted in accordance with a statute which has
b. Art. 32 - breach of constitutional and other not been judicially declared unconstitutional; and
rights (19) Freedom of access to the courts.
c. Art. 33 - defamation, fraud, physical injuries) In any of the cases referred to in this article,
d. Art 34 - refusal or failure of a city or whether or not the defendant's act or omission
municipal police to give protection constitutes a criminal offense, the aggrieved party
e. Art. 2176 - quasi-delict/ culpa aquiliana has a right to commence an entirely separate and
distinct civil action for damages, and for other
Art. 31. When the civil action is based on an relief. Such civil action shall proceed
obligation not arising from the act or omission independently of any criminal prosecution (if the
complained of as a felony, such civil action may latter be instituted), and may be proved by a
proceed independently of the criminal preponderance of evidence.
proceedings and regardless of the result of the The indemnity shall include moral damages.
latter. Exemplary damages may also be adjudicated.
The responsibility herein set forth is not
Art. 32. Any public officer or employee, or any demandable from a judge unless his act or
private individual, who directly or indirectly omission constitutes a violation of the Penal Code
obstructs, defeats, violates or in any manner or other penal statute.
impedes or impairs any of the following rights
and liberties of another person shall be liable to Art. 33. In cases of defamation, fraud, and
the latter for damages: physical injuries a civil action for damages,
(1) Freedom of religion; entirely separate and distinct from the criminal
(2) Freedom of speech; action, may be brought by the injured party. Such
(3) Freedom to write for the press or to maintain civil action shall proceed independently of the
a periodical publication; criminal prosecution, and shall require only a
(4) Freedom from arbitrary or illegal detention; preponderance of evidence.
When a member of a city or municipal police force
(5) Freedom of suffrage;
refuses or fails to render aid or protection to any
(6) The right against deprivation of property
person in case of danger to life or property, such
without due process of law;
peace officer shall be primarily liable for damages,
(7) The right to a just compensation when
and the city or municipality shall be subsidiarily
private property is taken for public use; responsible therefor. The civil action herein
(8) The right to the equal protection of the laws; recognized shall be independent of any criminal
(9) The right to be secure in one's person, proceedings, and a preponderance of evidence
house, papers, and effects against unreasonable shall suffice to support such action.
searches and seizures;
(10) The liberty of abode and of changing the Article 2176. Whoever by act or omission causes
same; damage to another, there being fault or
(11) The privacy of communication and negligence, is obliged to pay for the damage
correspondence; done. Such fault or negligence, if there is no pre-
(12) The right to become a member of existing contractual relation between the parties,
associations or societies for purposes not is called a quasi-delict.
contrary to law;
(13) The right to take part in a peaceable • NO DOUBLE RECOVERY – Article 2177,
assembly to petition the Government for redress plaintiff cannot recover damages twice for the
of grievances; same act or omission of the defendant.
ORDINARY CIVIL ACTION EX DELICTO BAR QUESTION (1996)

ART. 35. When a person, claiming to be Distinguish Juridical Capacity vs. Capacity to
injured by a criminal offense, charges Act
another with the same, for which no
independent civil action is granted in this SUGGESTED ANSWER
Code or any special law, but the justice of JURIDICAL CAPACITY is the fitness to be the
the peace finds no reasonable grounds to subject of legal relations while CAPACITY TO
believe that a crime has been committed, or ACT is the power or to do acts with legal effect.
the prosecuting attorney refuses or fails to The former is inherent in every natural person
institute criminal proceedings, the and is lost only through death while the latter is
complainant may bring a civil action for merely acquired and may be lost even before
death (Art. 37, NCC).
damages against the alleged offender. Such
civil action may be supported by a 1. RESTRICTIONS ON CAPACITY TO ACT
preponderance of evidence. Upon the a. Minority
defendant's motion, the court may require b. Imbecility
the plaintiff to file a bond to indemnify the c. Prodigality
defendant in case the complaint should be d. Deaf-Mute
e. Civil Interdiction
found to be malicious.
f. Insanity
g. Family Relations
If during the pendency of the civil action, an h. Alienage
information should be presented by the i. Trusteeship
prosecuting attorney, the civil action shall be j. Penalty
suspended until the termination of the k. Insolvency
criminal proceedings. l. Absence
PREJUDICIAL QUESTION 2. BIRTH AND DEATH OF NATURAL

ART. 36. Pre-judicial questions, which must PERSONS
be decided before any criminal prosecution BIRTH determines personality
DEATH extinguishes personality
may be instituted or may proceed, shall be
• A conceived child shall be considered born
governed by rules of court which the
for all purposes favorable to it, provided it is
Supreme Court shall promulgate and which born later with the conditions specified in
shall not be in conflict with the provisions of Article 41 of the NCC.
this Code.
• A prejudicial question is one which must ‘Favorable to it’ defined
be decided first before a criminal action - ie. become a donee, receive support,
may be instituted or may proceed successional right.
because a decision therein is vital to the
judgment in the criminal case. BAR QUESTION (2014)
Mario executed his last will and testament
Requisites: where he acknowledges the child being
a. the previously instituted civil action conceived by his live-in partner Josie as his
involves an issue similar or intimately own child; and that his house and lot in Baguio
related to the issue raised in the City be given to his unborn conceived child.
subsequent criminal action, and
b. the resolution of such issue determines Are the acknowledgement and the donation
whether or not the criminal action may mortis causa valid? Why?
proceed. SUGGESTED ANSWER
K. CAPACITY TO ACT Yes, the acknowledgement is considered valid
'Capacity to Act' defined because a will may still constitute a document
which contains an admission of illegitimate
• Civil Personality is the aptitude of being
filiation.
the subject of rights and obligations
• It is synonymous with Juridical Capacity The donation mortis causa is also valid
which is “the fitness to be the subject of because although unborn, a fetus has a
legal relations.” presumptive personality for all purposes
• Capacity to Act on the other hand, is the favorable to it provided it be born under the
“power to do acts with legal effects.” conditions specified in Article 41.
Presumptive Personality REQUISITES:

A fetus with an intra-uterine life of: 1. The parties are heirs to one another
1. Less than 7 months: Must survive for at 2. There is no proof as to who died first
least 24 hours after its complete delivery 3. There is doubt as to who died first
from the maternal womb.
L. SURNAMES
2. At least 7 months: If born alive, it shall
be considered born even if it dies within • Legitimate and legitimated children shall
24 hours after complete delivery. principally use the surname of the father. (Art.
364)
BAR QUESTION (2012) • An adopted child shall bear the surname of the
adopter. (Art. 365)
Ricky donated Php1 Million to the unborn • Children conceived before the decree annulling
child of his pregnant girlfriend, which she a voidable marriage shall principally use the
accepted. After six (6) months of surname of the father.
pregnancy, the fetus was born and baptized • Illegitimate children shall bear the surname of
as Angela. However, Angela died 20 hours the mother.
• RA 9255 – allows illegitimate child to use the
after birth. Ricky sought to recover the
surname of the father provided, filiation is
Php1 Million. recognized:
(i) record of birth appearing in the civil
Is Ricky entitled to recover? register;
(ii) admission in public document/ private
SUGGESTED ANSWER hand-written instrument.
Yes, Ricky is entitled to recover the
P1,000,000.00. ALANIS III V. CA (G.R. NO. 216425, November
11, 2020)
A fetus enjoys presumptive civil personality
• Abdulhamid Ballaho was born and registered
for purposes favorable to it provided it is
as Anacleto Ballaho Alanis III, the legitimate
born later in accordance with the provision child of Mario Alanis and Jarmila Ballaho. All
of the New Civil Code. While the donation his records show his name as Abdulhamid
is favorable to the fetus, the donation did Ballaho; he never used his registered name.
not take effect because the fetus was not In line with this he filed a petition to change
born in accordance with the NCC. his name and surname to be known and
To be considered born, the fetus that had registered as Abdulhamid Ballaho.
an intrauterine life of less than seven (7) • RTC denied the Petition. It noted that the
months should live for 24 hours from its mere fact that petitioner has been using a
complete delivery from the mother’s womb. different name and has become known by it is
not a valid ground for change of name. It also
Since Angela had an intrauterine life of less
held that to allow him to drop his last name
than seven (7) months but did not live for
was to disregard the surname of his natural
24 hours, she was not considered born and legitimate father, in violation of the Family
and, therefore, did not become a person. Code and Civil Code, which provide that
Not being a person, she has no juridical legitimate children shall principally use their
capacity to be a donee, making the fathers' surnames.
donation ineffective. • ARTICLE 174. Legitimate children shall have
the right: (1) To bear the surnames of the
3. PRESUMPTION OF SURVIVORSHIP father and the mother, in conformity with the
Article 43. If there is a doubt, as between two or provisions of the Civil Code on Surnames.
more persons who are called to succeed each • In turn, Article 364 of the Civil Code provides:
other, as to which of them died first, whoever • ARTICLE 364. Legitimate and legitimated
alleges the death of one prior to the other, shall children shall principally use the surname of
prove the same; in the absence of proof, it is the father.
presumed that they died at the same time and • The Regional Trial Court's application of
there shall be no transmission of rights from one Article 364 of the Civil Code is incorrect.
to the other. • Indeed, the provision states that legitimate
children shall "principally" use the surname of
Burden of Proof: Whoever alleges the death of the father, but "principally" does not mean
one prior to the other shall prove the same; "exclusively."
• This gives ample room to incorporate into
Absent such proof: Presumption is they all Article 364 the State policy of ensuring the
died at the same time. There shall be no fundamental equality of women and men
transmission of successional rights. before the law, and no discernible reason to
ignore it.
A married woman may use: M. RULES GOVERNING

1. Her maiden first name and surname and PERSONS WHO ARE ABSENT
add her husband’s name, or
2. Her maiden first name and husband’s Provisional Measures in Case of Absence
surname, or • When a person disappears from his
3. Her husband’s full name, but prefixing a domicile, his whereabouts being unknown,
word indicating that she is his wife, such and without leaving an agent to administer
as “Mrs.” (Art 370, NCC) his property, the judge, at the instance of
4. Fourth option is to use maiden name and an interested party, a relative, or a friend,
disregard Article 370 since it used “may”, may appoint a person to represent him in
which means use is optional. all that may be necessary.
• This same rule shall be observed when
Annulled Marriage under similar circumstances the power
• If wife is the guilty party, she shall resume conferred by the absentee has expired.
her maiden name and surname. • In the appointment of a representative, the
• If the wife is the innocent spouse, she may spouse present shall be preferred when
resume her maiden name and surname. there is no legal separation.
She may also choose to continue • If the absentee left no spouse, any
employing her husband’s surname, unless: competent person may be appointed by
a. The court decrees otherwise, or the court.
b. She or the former husband is married
again to another person DECLARATION OF ABSENCE
Judicial Declaration of Absence
Legally Separated • 2 years having elapsed without any news,
• The wife shall continue using her name or since receipt of last news, or 5 years in
and surname as employed before case absentee left a person in charge
separation. • At the instance of any of the following:
- Spouse present;
Death of Husband - Heirs instituted in the will;
• A widow may use the deceased husband’s - Relatives who may succeed by
surname as though he were still living, in intestacy;
accordance with Article 370. - Those who have interest over
absentee’s property which is
Identity of Names conditioned on his death.
• In case of identity of names and surnames, • Declaration of absence shall take effect
a younger person shall be obliged to use only 6 months after publication.
such additional name or surname as will
avoid confusion. ADMINISTRATION OF PROPERTY OF THE
• In case of identity of names and surnames ABSENTEE
between ascendants and descendants, the • An administrator of the absentee’s property
word “Junior” can be used only by a son. shall be appointed.
• Grandsons and other direct male • The wife who is appointed as an
descendants shall either: administratrix of the husband’s property
a. Add a middle name or the mothers’ cannot alienate or encumber the
surname, or husband’s property; or that of the conjugal
b. Add the Roman numerals II, III, and so partnership, without judicial authority.
on.
WHEN SHALL ADMINISTRATION CEASE
Changing, Usurpation & Pen Names The administration shall cease in any of the
• No person can change his name or following cases:
surname without judicial authority (1) When the absentee appears personally or
• Usurpation of a name and surname may by means of an agent;
be subject of an action for damages and (2) When the death of the absentee is proved
other relief. and his testate or intestate heirs appear;
• The employment of pen names or stage (3) When a third person appears, showing by
names is permitted, provided it is done in a proper document that he has acquired
good faith and there is no injury to third the absentee’s property by purchase or
persons. Pen names and stage names other title.
cannot be usurped. (Art. 379 NCC)
PRESUMPTION OF DEATH Ruling:

Art. 390. After an absence of seven years, it The petition for the declaration of presumptive
being unknown whether or not the absentee still death filed by petitioner is not an action that
lives, he shall be presumed dead for all would have warranted the application of Article
purposes, except for those of succession. 41 of the FC because petitioner was not seeking
The absentee shall not be presumed dead for to remarry. A reading of Article 41 of the FC
the purpose of opening his succession till after shows that the presumption of death established
an absence of ten years. If he disappeared after therein is only applicable for the purpose of
the age of seventy-five years, an absence of five contracting a valid subsequent marriage under
years shall be sufficient in order that his the said law.
succession may be opened. • Given that her petition for the declaration of
presumptive death was not filed for the
Art. 391. The following shall be presumed dead purpose of remarriage, petitioner was clearly
for all purposes, including the division of the relying on the presumption of death under
estate among the heirs: either Article 390 or Article 391 of the Civil
(1) A person on board a vessel lost during a sea Code as the basis of her petition. Articles 390
voyage, or an aeroplane which is missing, and 391 of the Civil Code express the general
who has not been heard of for four years rule regarding presumptions of death for any
since the loss of the vessel or aeroplane; civil purpose.
(2) A person in the armed forces who has taken • Since the petition filed by the petitioner merely
part in war, and has been missing for four seeks the declaration of presumptive death of
years; Wilfredo under the Civil Code, the RTC should
(3) A person who has been in danger of death have dismissed such petition outright.
under other circumstances and his existence • This is because, in our jurisdiction, a petition
has not been known for four years. whose sole objective is to have a person
declared presumptively dead under the Civil
MATIAS V. REPUBLIC (G.R. No. 230751, April Code is not regarded as a valid suit and no
25, 2018) court has any authority to take cognizance of
Facts: the same.
• On April 10, 2012, petitioner Estrellita Tadeo- • Dissecting the rulings of Szatraw, Gue and
Matias filed before the Regional Trial Court Lukban collectively, we are able to ascertain
(RTC) of Tarlac City a petition for the the considerations why a petition for
declaration of presumptive death of her declaration of presumptive death based on the
husband, Wilfredo N. Matias. Civil Code was disallowed in our jurisdiction,
• Wilfredo is a member of the Philippine viz:
1. Articles 390 and 391 of the Civil Code
Constabulary and was assigned in Arayat,
merely express rules of evidence that only
Pampanga since August 24, 1967. The got
allow a court or a. tribunal to presume that
married in 1968. On September 15, 1979, he
a person is dead upon the establishment of
set out from their conjugal home to again certain facts.
serve as a member of the Philippine 2. Since Articles 390 and 391 of the Civil
Constabulary. Wilfredo never came back from Code merely express rules of evidence, an
his tour of duty in Arayat, Pampanga since action brought exclusively to declare a
1979 and he never made contact or person presumptively dead under either of
communicated with her nor to his relatives. the said articles actually presents no actual
• After more than three (3) decades of waiting, controversy that a court could decide. In
she wanted to claim death benefits due to a such action, there would be no actual
surviving spouse. One of the requirements to rights to be enforced, no wrong to be
attain the claim of benefits is for a proof of remedied nor any status to be established.
death or at least a declaration of presumptive 3. A judicial pronouncement declaring a
death by the Honorable Court. person presumptively dead under Article
• Thus, she filed a petition for declaration of 390 or Article 391 of the Civil Code, in an
presumptive death under Article 41 of the FC action exclusively based thereon, would
solely to claim for the benefit under P.D. No. never really become "final" as the same
1638 as amended. only confirms the existence of a prima
• The RTC issued a Decision granting the facie or disputable presumption. The
petition. The OSG questioned the decision via function of a court to render decisions that
is supposed to be final and binding
a Petition for Certiorari. The CA granted the
between litigants is thereby compromised.
Petition for Certiorari holding that Article 41 of
4. Moreover, a court action to declare a
the Family Code will only apply if the purpose
person presumptively dead under Articles
of the party is re-marriage. 390 and 391 of the Civil Code would be
Issue: unnecessary. The presumption in the said
WoN a petition for declaration of presumptive articles is already established by law.
death under Article 41 is correct.
II. MARRIAGE
A. General Principles G. Legal Separation
B. Mixed Marriages & Foreign Divorce H. Property Relations Between Spouses
C. Void Marriages (See Tan-Andal v. Andal, I. The Family
G.R. No. 196359, May 11, 2021) J. The Family Home
D. Voidable Marriages K. Paternity and Filiation
E. Effect of Defective Marriages L. Support
F. Foreign Marriages M. Parental Authority
Marriage' defined
• 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 whose nature, consequences, and
incidents are governed by law and not subject to stipulation, except that marriage settlements may fix
the property relations during the marriage within the limits provided by this Code.
MARRIAGE CONTRACT V. ORDINARY CONTRACT
MARRIAGE CONTRACT ORDINARY CONTRACT
Only two (2) persons of the opposite sex An ordinary contract may be entered into by any number of
may enter into a contract of marriage. persons, whether of the same or different sex.
The nature, consequences and the parties are free to establish such stipulations, terms
incidents of marriage are governed by and conditions as they may deem convenient provided that
law and not subject to stipulation. they are not contrary to law, morals, good customs, public
order or public policy.
Cannot be revoked, dissolved or Parties may, by mutual agreement, terminate an ordinary

terminated by the parties, but only by contract.
the sovereign power of the State.
A. GENERAL PRINCIPLES WHO ARE AUTHORIZED TO SOLEMNIZE

MARRIAGES?
1. ESSENTIAL REQUISITES 1. Any incumbent member of the Judiciary;
a.) Legal capacity of the contracting parties: 2. Any priest, rabbi, imam, or minister of any
i. A male and a female; church or religious sect
ii. At least 18 years of age 3. Ship captain or airplane chief (for marriage in
iii. Must not be suffering from any legal articulo mortis);
impediment 4. A military commander of a unit, who is a
iv. Relationship commissioned officer;
b.) Consent freely given by the contracting 5. Consul-general, consul or vice-consul;
parties before the solemnizing officer. 6. Mayors
Effect of Absence of Essential Requisites MARRIAGE LICENSE

• The absence of any of the essential requisites ‘Valid Marriage License’ defined
shall render the marriage void ab initio. - A marriage license shall be issued by the
• A defect in the essential requisite of consent local civil registrar of the city or municipality
shall render the marriage voidable. where either contracting party habitually
resides.
2. FORMAL REQUISITES - A marriage license is valid for a period of 120
a. Authority of the solemnizing officer days from the date of its issuance. It is
b. A valid marriage license deemed automatically cancelled at the
c. Marriage ceremony expiration of said period.
- A marriage license is valid anywhere in the
Effect of Absence of Formal Requisites Philippines
• The absence of any of the formal requisites
shall render the marriage void ab initio. PARENTAL CONSENT
• An irregularity in the formal requisite/s shall If any party is below 21, parental consent must
not affect the validity of the marriage but the be exhibited to the local civil registrar.
party responsible for the irregularity shall be Otherwise, marriage is voidable.
civilly, criminally and administratively liable.
PARENTAL ADVICE
BAR QUESTION (2008)
If any party is between 21 and 25, parental
advice is required. Otherwise, license shall only Roderick and Faye were high school
be issued after 3 months from completion of sweethearts. When Roderick was 18 and
publication of the application. Faye, 16 years old, they started to live
together as husband and wife without the
Marriages Exempt From the License benefit of marriage. When Faye reached 18
Requirement years of age, her parents forcibly took her
1. Marriage in articulo mortis (In case either or back and arranged for her marriage to Brad.
both of the contracting parties are at the Although Faye lived with Brad after the
point of death)
marriage, Roderick continued to regularly
2. Marriage in remote places (If the residence
visit Faye while Brad was away at work.
of either party is so located that there is no
means of transportation to enable such party
During their marriage, Faye gave birth to a
to appear personally before the local civil
registrar) baby girl Laica. When Faye was 25 years
3. Marriage among Muslims and members of old, Brad discovered her continued liaison
ethnic cultural communities with Roderick and in one of their heated
4. Marriage of a man and a woman who have arguments, Faye shot Brad to death. She
been living together as husband and wife for lost no time in marrying her true love
at least 5 years and without any legal Roderick, without a marriage license,
impediment to marry each other. In lieu of a claiming that they have been continuously
marriage license, the parties must execute cohabiting for more than 5 years.
an Affidavit of Cohabitation.
Was the marriage of Roderick and Faye
BAR QUESTION (2016) valid?
Brad and Angelina had a secret marriage SUGGESTED ANSWER
before a pastor whose office is located in
Arroceros Street, City of Manila. They paid No. the marriage of Roderick and Faye is not
money to the pastor who took care of all valid.
the documentation. When Angelina wanted
to go to the U.S., she found out that there Art. 4, FC provides that the absence of any
of the essential or formal requisites renders
was no marriage license issued to them
the marriage void ab initio. However, no
before their marriage.
license shall be necessary for the marriage of
a man and a woman who have lived together
Since their marriage was solemnized in
as husband and wife for at least 5 years and
1995 after the effectivity of the Family without any legal impediment to marry each
Code, Angelina filed a petition for judicial other. This five-year period is characterized
declaration of nullity on the strength of a by exclusivity and continuity.
certification by the Civil Registrar of Manila In the present case, the marriage of Roderick
that, after a diligent and exhaustive search, and Faye cannot be considered as a
the alleged marriage license indicated in marriage of exceptional character, because
the marriage certificate does not appear in there were 2 legal impediments during their
the records and cannot be found. cohabitation: minority on the part of Faye,
during the first two years of cohabitation;
Decide the case and explain. and, lack of legal capacity, since Faye
married Brad at the age of 18.
SUGGESTED ANSWER
The marriage of Brad and Angelina should The absence of a marriage license made the
be declared void. One of the formal marriage of Faye and Roderick void ab initio
requisites of a marriage is a marriage
license, the total absence of which will BAR QUESTION (2017)
render the marriage void. The absence of
the marriage license was certified by the State whether the following marital
local civil registrar who is the official unions are valid, void, or voidable:
custodian of these documents and who is Marriage of Zoren and Carmina who did not
in the best position to certify as to the secure a marriage license prior to their
existence of these records. wedding, but lived together as husband and
(Republic v. Castro, GR No. 103047, wife for 10 years without any legal
September 2, 1994). impediment to marry.
SUGGESTED ANSWER BAR QUESTION (2009)

The marriage between Zoren and Carmina In December 2000, Michael and Anna,
is valid because it is one of those exempt after obtaining a valid marriage license,
from the license requirement under the went to the Office of the Mayor of Urbano,
Family Code (Article 34). No license shall Bulacan, to get married.
be necessary for the marriage of a man
and a woman who have lived together as The Mayor was not there, but the Mayor’s
husband and wife for at least five years secretary asked Michael and Anna and
without any legal impediment to marry each their witnesses to fill up and sign the
other. Zoren and Carmina must execute an required marriage contract forms. The
affidavit to that effect. secretary then told them to wait, and went
out to look for the Mayor who was
MARRIAGE CEREMONY attending a wedding in a neighboring
• There is no prescribed form or religious municipality.
rite for the solemnization of a marriage.
• Minimum requirements constituting a When the secretary caught up with the
marriage ceremony: Mayor at the wedding reception, she
i. the appearance of the contracting showed him the marriage contract forms
parties before the solemnizing and told him that the couple and their
officer, and witnesses were waiting in his office.
ii. their personal declaration that they
take each other as husband and The Mayor forthwith signed all the copies
wife in the presence of not less of the marriage contract, gave them to the
than two witnesses of legal age. secretary who returned to the Mayor’s
office. She then gave copies of the
VENUE OF MARRIAGE CEREMONY marriage contract to the parties, and told
Art. 8. The marriage shall be solemnized Michael and Anna that they were already
publicly in the chambers of the judge or in married. Thereafter, the couple lived
open court, in the church, chapel or temple, together as husband and wife, and had
or in the office the consul-general, consul three sons.
or vice-consul, as the case may be, and not
elsewhere, except in cases of marriages Is the marriage of Michael and Anna
contracted on the point of death or in valid, voidable, or void?
remote places, or where both of the parties
request the solemnizing officer in writing in SUGGESTED ANSWER
which case the marriage may be The marriage is void. Under the Family
solemnized at a house or place designated Code a marriage is void in the absence of
by them in a sworn statement to that effect. the formal requisite of marriage ceremony.
In this case, no marriage ceremony
General Rule: Marriage shall be transpired since the parties did not appear
solemnized publicly in the chambers of the before the Mayor, and the latter simply
judge or in open court, in the church, signed the marriage contract while
chapel or temple, or in the office the attending a wedding in a neighboring
consul-general, consul or vice-consul. municipality.
XPN: Marriage Contract’ defined
In cases of marriages contracted: • A marriage contract is the best documentary
a. on the point of death; evidence of a marriage.
b. in remote places; • Its absence is not, however, proof that no
c. where both of the parties request the marriage took place because other evidence
may be presented to prove the fact of
solemnizing officer in writing.
marriage.
• The mere fact that no record of the marriage
Note: exists in the registry of marriage does not
• Marriage is still valid if not complied. invalidate said marriage, as long as in the
• Mere irregularity in marriage ceremony. celebration thereof, all requisites for its
validity are present.
B. MIXED MARRIAGES AND BAR QUESTION (2019)

FOREIGN DIVORCE F, a Filipina, married J. a Japanese, in the
Philippines. After three (3) years, they had
Mixed Marriage’ defined a falling out and thus, separated. Soon
• it is the marriage between a Filipino and after, F initiated a divorce petition in Japan
Foreign national. which was not opposed by J. because
under Japanese law, a grant of divorce
Foreign Divorce
will capacitate him to remarry. F’s divorce
• Philippines has no Divorce.
petition was then granted by the Japanese
• Divorce may only be recognized in case of
court with finality.
mixed marriage.
Art. 26(2). Where a marriage between a May the legal effects of the divorce
Filipino citizen and a foreigner is validly decree be recognized in the
celebrated and a divorce is thereafter validly Philippines, and consequently,
obtained abroad by the alien spouse capacitate F to remarry here? Explain.
capacitating him or her to remarry, the SUGGESTED ANSWER
Filipino spouse shall have capacity to
remarry under Philippine law. Yes, the legal effects of the divorce decree
may be recognized in the Philippines, and
Explanation: consequently, capacitate F to remarry.
• Article 26 (2) only requires that there be a
divorce validly obtained abroad. It “does In the case of Republic v. Manalo [G.R.
not demand that the alien spouse should No. 221029, April 24, 2018], the Supreme
be the one who initiated the proceeding Court held that the Family Code does not
wherein the divorce decree was granted. distinguish as to who between the Filipino
• It does not distinguish whether the Filipino and foreign spouse in a mixed marriage
spouse is the petitioner or the respondent initiated the divorce petition. What is
in the foreign divorce proceeding. xxx A important is that the divorce was secured
Filipino who initiated a foreign divorce in accordance with the national law of the
proceeding is in the same place and in like foreign spouse, and the same capacitated
circumstances as a Filipino who is at the the foreign spouse to remarry. Here, F
receiving end of an alien initiated
initiated a divorce petition in Japan and
proceeding.” (Republic vs. Manalo)
obtained a favorable judgment which
capacitated her Japanese husband to
ANGELITA SIMUNDAC-KEPPEL V.
GEORG KEPPEL | G.R. No. 202039. remarry.
August 14, 2019
The rules on divorce prevailing in this Thus, the legal effects of the divorce
jurisdiction can be summed up as follows: obtained by F may be recognized in the
1. Philippine laws do not provide for Philippines which may capacitate F to
absolute divorce, and hence, the courts remarry here.
cannot grant the same;
2. Consistent with Articles 15 and 17 of the BAR QUESTION (2009)
Civil Code, the marital bond between two Harry married Wilma, a very wealthy
(2) Filipino citizens cannot be dissolved
woman. Barely five (5) years into the
even by an absolute divorce obtained
marriage, Wilma fell in love with Joseph.
abroad;
Thus, Wilma went to a small country in
3. An absolute divorce obtained abroad by a
Europe, became a naturalized citizen of
couple who are both aliens may be
that country, divorced Harry, and married
recognized in the Philippines, provided it
Joseph. A year thereafter, Wilma and
is consistent with their respective national
Joseph returned and established
laws; and
permanent residence in the Philippines.
4. In mixed marriages involving a Filipino
and a foreigner, the former is allowed to
contract a subsequent marriage in case Is the divorce obtained by Wilma from
the absolute divorce is validly obtained Harry recognized in the Philippines?
abroad by the alien spouse capacitating Explain your answer.
him or her to remarry.
SUGGESTED ANSWER C. VOID MARRIAGES

Yes, the divorce obtained by Wilma is
recognized as valid in the Philippines. At the • Scattered provisions in the Family Code
time she got the divorce, she was already a • Articles 4, 35, 36, 37, 38, 40, 41, 44 and
foreign national having been naturalized as a 53 in relation to Article 52
citizen of that “small country in Europe.” • Tan-Andal v. Andal, G.R. No. 196359,
May 11, 2021
Based on precedents established by the
Supreme Court (Bayot vs. CA, 570 SCRA 472 ABSENCE OF ESSENTIAL OR FORMAL
[2008]), divorce obtained by a foreigner is REQUISITE
recognized in the Philippines if validly obtained Art. 4. The absence of any of the essential
in accordance with his or her national law or formal requisites shall render the
marriage void ab initio, except as stated in
BAR QUESTION (2012) Article 35 (2)
Cipriano and Lady Miros married each other.
Lady Miros then left for the US and there, she MARRIAGES CONSIDERED VOID FROM
obtained American citizenship. THE BEGINNING
Cipriano later learned all about this including Article 35.
the fact that Lady Miros has divorced him in 1. Those contracted minors
America, and that he had authority to remarry, 2. Lack of authority of solemnizing officer
invoking Par. 2, Art. 26 of the Family Code. (unless either or both parties believing in
good faith that the solemnizing officer
Is Cipriano capacitated to re-marry by virtue
had the legal authority to do so)
of the divorce decree obtained by his
Filipino spouse who was later naturalized
3. Absence of marriage license (unless
as an American citizen? Explain. exempted)
4. Bigamous or polygamous marriages
SUGGESTED ANSWER (except valid bigamous marriage under
Yes, Cipriano is capacitated to remarry. Article 41 on presumptive death)
Jurisprudence dictates that Art. 26 of the 5. Mistake of party as to the identity of the
Family Code equally applies to a Filipino who other.
married another Filipino at the time of the 6. Subsequent marriages that are void
marriage, but who was already a foreigner under Article 53 (failure to comply with
when the divorce was obtained. The reckoning requirements under Art. 52)
point is the citizenship of the parties at the time
a valid divorce is obtained. (Bayot vs. CA, G.R.
VOID SUBSEQUENT MARRIAGE DUE TO
No. 155635, November 7, 2008)
NON-COMPLIANCE WITH ART. 52
Article 52. The judgment of annulment or of
BAR QUESTION (2012) absolute nullity of the marriage, the partition
True or False: and distribution of the properties of the
Under Art. 26 of the Family Code, when a spouses and the delivery of the children's
foreign spouse divorces his/her Filipino presumptive legitimes shall be recorded in
spouse, the latter may re-marry by proving the appropriate civil registry and registries of
only that the foreign spouse has obtained a property; otherwise, the same shall not
divorce against her or him abroad. affect third persons.
SUGGESTED ANSWER Article 53. Either of the former spouses may

FALSE. In Garcia vs. Recio, 366 SCRA 437 marry again after compliance with the
(2001), the SC held that for a Filipino requirements of Article 52, otherwise, the
spouse to have capacity to contract a subsequent marriage shall be null and void.
subsequent marriage, it must also be
proven that the foreign divorce obtained BAR QUESTION (2010)
abroad by the foreigner spouse gives such State whether the following marital
foreigner spouse the capacity to remarry. union is valid, void, or voidable:
TRUE. Art. 26 (2) (FC), clearly provides David, who married Lina immediately the
that the decree of divorce obtained abroad day after obtaining a judicial decree
by the foreigner spouse is sufficient to annulling his prior marriage to Elsa.
capacitate the Filipino spouse to remarry.
SUGGESTED ANSWER • On December 18, 2001, Mario filed a

Petition for custody of Ma. Samantha
It shall be considered void even if it was
celebrated after David obtained a judicial before the Regional Trial Court. Mario
decree annulling his previous marriage to Elsa. argued that he and his wife had equal rights
The law requires that in case the marriage is to the custody of Ma. Samantha, thus
annulled, the parties to the dissolved marriage praying that he be allowed to exercise
must first comply with the requirements of parental authority over his daughter.
recording the judgement of annulment in the • On August 6, 2003, Rosanna filed a Petition
appropriate civil registry and undertake the for declaration of nullity of her marriage,
partition, liquidation, and distribution of the claiming that Mario was psychologically
presumptive legitimes of their common children incapacitated to comply with his essential
before contracting a subsequent marriage. The marital obligations to her.
partition, liquidation, and distribution of the
presumptive legitimes must likewise be Issue:
recorded in the appropriate registries of WoN the marriage between Mario and
property. The failure of the parties to comply Rosanna is void due to psychological
with these requirements would render their incapacity.
marriage void under Article 53 of the Family
Code. Ruling:
Psychological incapacity is neither a mental
PSYCHOLOGICAL INCAPACITY incapacity nor a personality disorder that must
Article 36: be proven through expert opinion. There
• Marriage contracted by any party who, must be proof, however, of the durable or
at the time of celebration, was enduring aspects of a person's personality,
psychologically incapacitated to comply called “personality structure,” which manifests
with the essential marital obligations of itself through clear acts of dysfunctionality that
marriage undermines the family. The spouse's
• Psychological incapacity is a legal personality structure must make it impossible
concept not medical for him or her to understand and, more
• Totality of evidence; Clear and important, to comply with his or her essential
convincing evidence. marital obligations.
• Juridical antecedence - Must be
existing at the time of celebration Proof of these aspects of personality need not
although overt manifestations may be given by an expert. Ordinary witnesses
emerge only after the marriage who have been present in the life of the
• Gravity - “Mild characterological spouses before the latter contracted marriage
peculiarities, mood changes, occasional may testify on behaviors that they have
emotional outbursts are excluded. The consistently observed from the supposedly
psychological incapacity cannot be incapacitated spouse. From there, the judge
mere “refusal, neglect, or difficulty, will decide if these behaviors are indicative of
much less ill-will.” a true and serious incapacity to assume the
• Incurable in the legal sense - essential marital obligations.
incapacity is so enduring and persistent
That drug addiction is a ground for legal
TAN-ANDAL V. ANDAL | G.R. No. 196359. separation will not prevent this Court from
May 11, 2021 voiding the marriage in this case. A decree of
Facts: legal separation entitles spouses to live
• Mario Victor M. Andal (Mario) and separately from each other without severing
Rosanna L. Tan (Rosanna) married on their marriage bond, but no legal conclusion is
December 16, 1995 at the Saints Peter made as to whether the marriage is valid.
and Paul Parish in Poblacion, Makati City. Therefore, it is possible that the marriage is
On July 27, 1996, Rosanna gave birth to attended by psychological incapacity of one or
both spouses, with the incapacity manifested
Ma. Samantha, the only child of the
in ways that can be considered as grounds for
parties. The family lived in a duplex in
legal separation. At any rate, so long as a
Parañaque City, with Rosanna's parents
party can demonstrate that the drug abuse is
living in the other half of the duplex.
a manifestation of psychological incapacity
• After four years of marriage, Mario and
existing at the time of the marriage, this
Rosanna separated in 2000. Rosanna has
should be enough to render the marriage void
since kept the sole custody of Ma. under Article 36 of the Family Code.
Samantha.
To summarize, psychological incapacity consists Issue:

of clear acts of dysfunctionality that show a lack WoN Hannamer proved Grant’s
of understanding and concomitant compliance psychological incapacity.
with one's essential marital obligations due to
psychic causes. It is not a medical illness that Ruling:
has to be medically or clinically identified; hence,
• In determining that Mario is
expert opinion is not required.
psychologically incapacitated, We used
As an explicit requirement of the law, the the following parameters (Tan-Andal
psychological incapacity must be shown to have guidelines):
been existing at the time of the celebration of the (1) The psychological incapacity must be
marriage, and is caused by a durable aspect of shown to have been existing at the
one's personality structure, one that was formed time of the celebration of marriage;
before the parties married. Furthermore, it must (2) Caused by a durable aspect of one's
be shown caused by a genuinely serious personality structure, one that was
psychic cause. To prove psychological formed prior to their marriage;
incapacity, a party must present clear and (3) Caused by a genuinely serious
convincing evidence of its existence.
psychic cause; and
Here, the totality of evidence presented by
(4) Proven by clear and convincing
Rosanna clearly and convincingly proved that evidence.
Mario's drug abuse was of sufficient durability
that antedates the marriage. Admittedly, part of • Tan-Andal further enunciates that
marriage is accepting a person for who they are, psychological incapacity is not a mental
including their addictions. However, in Mario's incapacity nor a personality disorder that
case, his persistent failure to have himself must be proven through an expert
rehabilitated, even bringing his child into a room witness. Ordinary witnesses who have
where he did drugs, indicates a level of been present in the life of the spouses
dysfunctionality that shows utter disregard of his before their marriage may testify on the
obligations not only to his wife, but to his child.
behaviors they have observed from the
PUGOY-SOLIDUM VS. REPUBLIC | G.R. No.
allegedly incapacitated spouse. Likewise,
213954, April 20, 2022 (Hernando) juridical antecedence of psychological
Facts: incapacity may also be proven by ordinary
• Hannamer and Grant were classmates and witnesses who can describe the
sweethearts during fourth year high school. incapacitated spouse's past experiences
After graduation, Hannamer worked and or environment growing up, which may
started living with Grant. Hannamer became have triggered one's particular behavior.
pregnant and had to stop working. After In any case, the gravity of psychological
Hannamer gave birth, her mother convinced incapacity must be shown to have been
her and Grant to get married. Thus, their caused by a genuinely serious psychic
marriage was solemnized on March 12, 2003.
cause. Thus, "mild characterological
Hannamer spent for their wedding and their
child’s baptismal expenses. On the other
peculiarities, mood changes, occasional
hand, Grant was unemployed and could not emotional outbursts" are still not accepted
contribute for their living expenses which grounds that would warrant a finding of
were all shouldered by Hannamer’s mother. psychological incapacity under Article 36
• Hannamer’s mother decided to move in with of the Family Code.
the couple which resulted to their relationship
turning sour, and Hannamer eventually • Tan-Andal also modified the requirement
leaving their house and staying with Grant’s on incurability — that psychological
relatives instead. Grant never visited nor sent incapacity under Article 36 of the Family
financial support for Hannamer and their Code must now be incurable, not in the
child. Eventually, they lost contact with each
medical, but in the legal sense. Thus, it
other when Hannamer moved to another town
with her mother and child. must be so enduring and persistent with
• On January 3, 2010, Hannamer filed a respect to a specific partner, that the only
petition for declaration of nullity of marriage result of the union would be the inevitable
under Article 36 of the Family Code alleging and irreparable breakdown of the
that Grant was psychologically incapacitated marriage. Ultimately, the totality of
to comply with all the essential marital evidence must support a finding of
obligations. psychological incapacity.
• Guided by the foregoing measures, this BAR QUESTION (2008)

Court finds that Hannamer failed to
sufficiently prove that Grant is Despite several relationships with different
psychologically incapacitated to comply women, Andrew remained unmarried. His
with one's essential marital obligations. first relationship with Brenda produced a
daughter, Amy, now 30 years old. His
xxx We agree with the CA in holding
second, with Carla, produced two sons: Jon
that the psychological report is bereft of and Ryan. His third, with Elena, bore him no
any factual basis proving Grant's children although Elena has a daughter Jane,
psychological incapacity. It fails to prove from a previous relationship. His last, with
the enduring aspects of Grant's Fe, produced no biological children but they
personality called "personality structure" informally adopted without court proceedings,
that manifest itself through clear acts of Sandy, now 13 years old, whom they
dysfunctionality that render him unable consider as their own. Sandy was orphaned
to discharge the essential marital as a baby and was entrusted to them by the
obligations. Notably, there is no midwife who attended to Sandy’s birth. All
evidence on record proving that Grant's the children, including Amy, now live with
Andrew in his house.
alleged psychological incapacity existed
prior to their marriage. Verily, Hannamer Can Jon and Jane legally marry?
also failed to provide any background
on Grant's past experiences or SUGGESTED ANSWER
environment growing up that could have Yes. Jon and Jane can marry each other;
triggered his behavior. Jon is an illegitimate child of Andrew while
Jane is a child of Elena from a previous
INCESTUOUS MARRIAGES relationship.
Article 37.
Marriages between: Thus, their marriage is not one of the
1. Ascendants and descendants of any prohibited marriages enumerated under Art.
degree; and 38 of the FC.
2. Between brothers and sisters,
BAR QUESTION (2012)
whether of full or half blood (whether
the relationship between the parties Write “TRUE” if the statement is true or
be legitimate or illegitimate) “FALSE” if the statement is false. If the
statement is FALSE, state the reason.
VOID MARRIAGES FOR REASONS OF Amor gave birth to Thelma when she was
PUBLIC POLICY (Article 38) 15 years old. Thereafter, Amor met David
Marriages between and they got married when she was 20
1. Collateral blood relatives, whether years old. David had a son, Julian, with his
ex-girlfriend Sandra.
legitimate or illegitimate, up to the
Julian and Thelma can get married.
fourth civil degree
2. Step-parents and step-children SUGGESTED ANSWER
3. Parents-in-law and children-in-law
TRUE.
4. Adopting parent and the adopted Julian and Thelma can get married.
child Marriage between stepbrothers and
5. Surviving spouse of the adopting stepsisters are not among the marriages
parent and the adopted child prohibited under the Family Code.
6. Surviving spouse of the adopted
child and the adopter ACTION OR DEFENSE FOR
7. Adopted child and a legitimate child DECLARATION OF NULLITY SHALL NOT
of the adopter PRESCRIBE
8. Adopted children of the same • No prescriptive period in asking for
adopter. declaration of nullity.
9. Parties where one, with the intent to • Heirs may attack the validity of marriage
marry the other killed that other in proceedings for settlement of estate to
person’s spouse or his or her own determine successional rights. (Heirs of
spouse. Aguas v. Calilung)
LUCILA DAVID AND THE HEIRS OF RENE F. HEIRS CAN COLLATERALLY ATTACK THE
AGUAS v. CHERRY S. CALILUNG | G.R. NO. MARRIAGE IN INTESTATE PROCEEDINGS
241036, JANUARY 26, 2021 While A.M. No. 02-11-10-SC declares that a
RULING: petition for declaration of absolute nullity of void
• The petitioners are not the real party-in- marriage may be filed solely by the husband or
interest to file the RTC petition the wife, it does not mean that the compulsory or
• The Court issued A.M. No. 02-11-10-SC intestate heirs are already without any recourse
which took effect on March 15, 2003, in order under the law. They can still protect their
to govern direct actions for declaration of successional right, for, as stated in the Rationale
nullity or annulment of marriage. As ruled in of the Rules on Annulment of Voidable Marriages
Enrico, Section 2(a) of A.M. No. 02-11-10-SC and Declaration of Absolute Nullity of Void
makes it the sole right of the husband or the Marriages, Legal Separation and Provisional
wife to file a petition for declaration of Orders (Rationale of the Rules), compulsory or
absolute nullity of void marriage. intestate heirs can still question the validity of the
• Only an aggrieved or injured spouse may file marriage of the spouses, not in a proceeding for
a petition for annulment of voidable marriages declaration of nullity, but upon the death of a
or declaration of absolute nullity of void spouse in a proceeding for the settlement of the
marriages. Such petition cannot be filed by estate of the deceased spouse filed in the regular
compulsory or intestate heirs of the spouses courts.
or by the State. The Committee is of the belief
that they do not have a legal right to file the LUCILA HAS NO STANDING IN THE
petition. Compulsory or intestate heirs have SETTLEMENT PROCEEDINGS, BUT MAY ASK
only inchoate rights prior to the death of their FOR PARTITION
predecessor, and hence can only question With regard to Lucila, xxx only mentioned
the validity of the marriage of the spouses compulsory or intestate heirs as the ones who
upon the death of a spouse in a proceeding could collaterally assail the validity of a marriage
in a proceeding for the settlement of the estate of
for the settlement of the estate of the
the deceased spouse filed in the regular courts in
deceased spouse filed in the regular courts.
order to protect their successional rights. This
On the other hand, the concern of the State is
would mean then that the said remedy or
to preserve marriage and not to seek its
recourse under the law is not available to Lucila
dissolution.
since she is not an heir of Rene, her marriage
• Lucila, on the other hand, is not the wife in the
with the deceased having been declared null and
marriage that she and her children sought to void from the very beginning on the ground of
annul. Be it noted that she is not a spouse of psychological incapacity in the 2005 Nullity
Rene, their marriage having been declared Decision. Lucila is, therefore, considered as a
null and void from the very beginning on the stranger in the estate proceedings with no right to
ground of psychological incapacity in the succeed as an heir of Rene, thus, she has no
2005 Nullity Decision. Accordingly, Lucila, standing to participate in the Settlement
could not be the aggrieved or injured spouse Proceeding.
referred to by A.M. No. 02-11-10-SC who has
the legal standing to file the complaint for The Court holds that Lucila, being a stranger to
nullity of marriage of the spouses Rene and the Settlement Proceeding, should file a separate
Cherry. civil action for partition before the regular courts
• Niñal v. Bayadog is not applicable in this against the administrator of Rene's estate. This
case. The petitioners insist on the application course of action is not only consistent with the
of Niñal v. Bayadog where the Court allowed aforesaid jurisprudential pronouncements, but is
the children by a previous marriage to file a likewise in accord with Section 1, Rule 87 of the
direct action to declare a subsequent Rules of Court, which provides that an action to
marriage void after the death of their father. recover real property or an interest therein from
The Court cannot agree with the petitioners. the estate may be commenced against
• The ruling in Niñal is not applicable in the administrator.
instant case as it involves a marriage under
the Civil Code while the instant case, like in STATUS OF CHILDREN UNDER A VOID
Enrico, concerns a marriage celebrated MARRIAGE
during the effectivity of the Family Code and General Rule: Under a void marriage, children
of A.M. No. 02-11-10-SC. are considered as Illegitimate.
• While it is true that Niñal in no uncertain terms Exceptions:
allowed therein petitioners to file a petition for 1. Children conceived or born before the
the declaration of nullity of their father's judgment of annulment or absolute nullity
marriage to therein respondent after the death under Article 36 has become final and
of their father, we cannot, however, apply its executory shall be considered legitimate.
ruling for the reason that the impugned 2. Children conceived or born of the subsequent
marriage under Article 53 shall likewise be
marriage therein was solemnized prior to the
legitimate. (Art. 54, FC)
effectivity of the Family Code.
PRESUMPTION OF VALIDITY • In 2009, the RTC convicted Pulido and

• Every marriage enjoys the presumption of acquitted Baleda. In 2015, the CA affirmed
validity. the conviction of Pulido. Hence, the petition
• Before contracting a second marriage, there for review before the SC.
must be a prior judgment declaring the • In May 2016, during the pendency of the
previous marriage void. case before the SC, a judicial declaration of
• If he/she contracts a subsequent marriage nullity of Pulido’s marriage with Arcon due to
without securing a judicial declaration of the absence of a valid marriage license was
nullity of the prior marriage, the subsequent issued by the RTC and has attained finality
marriage is itself void. in June 2016.
Issue:
INVOKING ABSOLUTE NULLITY FOR Whether an accused in a criminal case for
REMARRIAGE Bigamy may invoke the nullity of his first or
Art. 40. The absolute nullity of a previous second marriages as a defense?
marriage may be invoked for purposes of Ruling:
remarriage on the basis solely of a final
• After a careful scrutiny of the records and
judgment declaring such previous marriage void.
rigorous reexamination of the applicable law
and jurisprudence, we find that there is
LUISITO G. PULIDO v. People of the
enough basis to abandon our earlier
PHILIPPINES | G.R. No. 220149, JULY 27,
pronouncement and now hold that a void ab
2021 (BIGAMY - PROOF OF VOID AB INITIO
MARRIAGE WITHOUT NEED OF JUDICIAL
initio marriage is a valid defense in the
DECLARATION OF NULLITY ) prosecution for bigamy even without a
Facts: judicial declaration of absolute nullity.
• Records show that on September 5, 1983, Consequently, a judicial declaration of
then 16-year old petitioner married his absolute nullity of either the first and second
teacher, then 22-year old private complainant marriages obtained by the accused is
Nora S. Arcon (Arcon) in a civil ceremony at considered a valid defense in bigamy.
the Municipal Hall of Rosario, Cavite • Plainly, Article 40 of the Family Code does
solemnized by then Mayor Calixto D. not categorically withhold from the accused
Enriguez. Their marriage was blessed with a the right to invoke the defense of a void ab
child born in 1984. The couple lived together initio marriage even without a judicial
until 2007 when Pulido stopped going home decree of absolute nullity in criminal
to their conjugal dwelling. When confronted prosecution for bigamy. To adopt a contrary
by Arcon, Pulido admitted to his affair with stringent application would defy the principle
Baleda. Arcon likewise learned that Pulido that penal laws are strictly construed against
and Baleda entered into marriage on July 31, the State and liberally in favor of the
1995 which was solemnized by Reverend accused.
Conrado P. Ramos. Their Marriage • Nothing in Article 40 mentions the effect
Certificate indicated PuJido's civil status as thereof on the criminal liability of the
single. accused in bigamy cases. It would indeed be
• Hurt by the betrayal Arcon charged Pulido unfair to withhold from the accused in a
and Baleda with Bigamy on December 4, bigamy case the right and the opportunity to
2007. In his defense, Pulido insisted that he raise the defense of nullity of a void ab initio
could not be held criminally liable for bigamy marriage when the law does not explicitly
because both his Marriages were null and say so.
void. He claimed that his marriage with Arcon • All told, we hold that in a criminal
in 1983 is null and void for lack of a valid prosecution for bigamy, the accused can
marriage license while his marriage with validly interpose the defense of a void ab
Baleda is null and void for lack of a marriage initio marriage even without obtaining a
ceremony. judicial declaration of absolute nullity.
• Baleda, on the other hand, claimed that she • The said view is more in accord with the
only knew of Pulido's prior marriage with retroactive effects of a void ab initio
Arcon sometime in April 2007. She alleged
marriage, the purpose of and legislative
that even prior to the filing of the bigamy
intent behind Article 40 of the Family Code,
case, she already filed a Petition to Annul her
and the rule on statutory construction of
marriage with Pulido before the RTC of lmus,
penal laws. Therefore the absence of a
Cavite docketed as Civil Case No. 1586-07.
"prior valid marriage" and the subsequent
In a Decision dated October 25, 2007, the
RTC declared her marriage with Pulido as
judicial declaration absolute nullity of his first
null and void for being bigamous in nature. marriage, Pulido is hereby acquitted from the
This ruling attained finality, there being no crime of Bigamy as charged.
appeal filed thereto.
Summary: PERIOD OF DISAPPEARANCE

• The parties are not required to obtain a ✓ 4 YEARS
✓ 2 YEARS in case of danger of death under
Judicial declaration of nullity of a void ab
Art. 391 of the Civil Code:
initio first and subsequent marriages in
(1) A person on board a vessel lost during a sea
order to raise it as a defense in a bigamy voyage, or an aeroplane which is missing;
case. The same rule applies to all (2) A person in the armed forces who has taken
marriages celebrated under the Civil Code part in war;
and the Family Code. (3) A person who has been in danger of death
• Article 40 of the Family Code did not under other circumstances.
amend Article 349 of the RPC, and thus,
did not deny the accused the right to ABSENCE OR SEPARATION IN FACT
collaterally attack the validity of a void ab ‘Well-founded Belief’
initio marriage in the criminal prosecution - In determining the existence of a “well-
founded belief,” the belief of the present
for bigamy.
spouse must be the result of proper and
• However, if the first marriage is merely
honest to goodness inquiries and efforts to
voidable, the accused cannot interpose an ascertain the whereabouts of the absent
annulment decree as a defense in the spouse and whether the absent spouse is still
criminal prosecution for bigamy since the alive or is already dead.
voidable first marriage is considered valid - Active search not passive one
and subsisting when the second marriage
was contracted. The crime of bigamy, Failure to Secure Declaration of Presumptive
therefore, is consummated when the Death Under Art. 41, FC
second marriage was celebrated during ✓ If he/she contracts a subsequent marriage
the subsistence of the voidable first without such declaration:
i. The subsequent marriage is itself void; and
marriage. The same rule applies if the
ii. He/she may be prosecuted for the crime of
second marriage is merely considered as
bigamy
voidable.
ABSENCE OR SEPARATION IN FACT BAR QUESTION (2008)

• Mere absence of a spouse will not result Ana Rivera had a husband, a Filipino citizen
in dissolution. like her, who was among the passengers on
• Separation in fact will not also result in board a commercial jet plane which crashed
dissolution. in the Atlantic Ocean ten (10) years earlier
• Marriages can only be dissolved through and had never been heard of ever since.
a court action. Believing that her husband had died, Ana
married Adolf Cruz Staedtler, a divorced
Death – extinguishes marriage; the surviving German national born of a German father
spouse may marry again. and a Filipino mother residing in Stuttgart.
Missing – a court action is necessary to To avoid being required to submit the
declare missing spouse as presumptively required certificate of capacity to marry from
dead. the German embassy in Manila, Adolf stated
in the application for marriage license that he
VOID BIGAMOUS MARRIAGE, AND was a Filipino citizen. With the marriage
EXCEPTION ON ACCOUNT OF license stating that Adolf was a Filipino, the
PRESUMPTIVE DEATH couple got married in a ceremony officiated
Art. 41 by the Parish Priest of Calamba, Laguna in a
• Art 35 (4) all bigamous marriages are void beach in Nasugbu, Batangas, as the local
• Judicial Declaration of presumptive Death parish priest refused to solemnize marriages
except in his church.
1. Absence of 2 years or 4 years of missing
spouse
Is the marriage valid? Explain fully.
2. Spouse present wishes to remarry
3. Spouse present has a well-founded belief SUGGESTED ANSWER
that the absent spouse was already dead
No, the marriage is invalid. Article 41 of the
4. Spouse present must institute a Family Code allows the present spouse to
summary proceeding for the declaration contract a subsequent marriage during the
of presumptive death of the absentee, subsistence of his previous marriage
without prejudice to the effect of provided that:
reappearance of the absent spouse.
(a) that the spouse present has a well- REPUBLIC VS. PONCE-PILAPIL | G.R. No.
founded belief that the absent spouse 219185. November 25, 2020
was already dead, and J. Hernando
(b) present spouse instituted a summary Ruling:
proceeding for the declaration of the • Jurisprudence sets out four requisites for a
presumptive death of absent spouse. grant of a petition for declaration of
presumptive death under Article 41 of the
Otherwise, the second marriage shall be Family Code: first, the absent spouse has
null and void. In the instant case, the death been missing for four consecutive years, or
of Ana’s husband is not confirmed since no two consecutive years if the disappearance
dead body was found. Thus, following Art. occurred where there is danger of death
41, Ana should have first secured a judicial under the circumstances laid down in
declaration of his presumptive death before Article 391 of the Civil Code; second, the
she married Adolf. present spouse wishes to remarry; third,
the present spouse has a well-founded
The absence of the said judicial declaration belief that the absentee is dead; and
fourth, the present spouse files for a
incapacitated Ana from contracting her
summary proceeding for the declaration of
second marriage, making it void ab initio.
presumptive death of the absentee.
• The third requirement of a "well-founded
BAR QUESTION (2017) belief" proves most difficult to establish in
seeking to declare an absent spouse
State whether the following marital union presumptively dead. While this term enjoys
is valid, void, or voidable flexible meanings and depends heavily on
. the circumstances unique to each
Eli and Fely’s marriage solemnized seven particular case, the Court in Republic v.
years after the disappearance of Chona, Orcelino-Villanueva (Orcelino-Villanueva)
Eli’s previous spouse, after the plane she has highlighted the exercise of "diligent
had boarded crashed in the West efforts" in determining whether the present
Philippine Sea. spouse's belief that the absent spouse is
already dead was well-founded or not:
SUGGESTED ANSWER • The well-founded belief in the absentee's
The marriage between Eli and Fely which death requires the present spouse to prove
was solemnized seven years after the that his/her belief was the result of diligent
disappearance of Eli’s former wife, and reasonable efforts to locate the absent
Chona, is void unless Ely had secured a spouse and that based on these efforts
and inquiries, he/she believes that under
declaration of presumptive death of
the circumstances, the absent spouse is
Chona from a competent court prior to the
already dead. It necessitates exertion of
celebration of the subsequent marriage. active effort (not a mere passive one).
Mere absence of the spouse (even beyond
Article 41 of the Family Code considers the period required by law), lack of any
void a marriage contracted by any person news that the absentee spouse is still
during the subsistence of his/her previous alive, mere failure to communicate, or
marriage unless prior to the celebration of general presumption of absence under the
the subsequent marriage, the prior Civil Code would not suffice. The premise
spouse had been absent for four is that Article 41 of the Family Code places
consecutive years and the spouse upon the present spouse the burden of
present had a well-founded belief that the complying with the stringent requirement of
absent spouse is already dead. In case well-founded belief which can only be
the disappearance of the spouse discharged upon a showing of proper and
occurred under circumstances where honest-to-goodness inquiries and efforts to
there is danger of death under Article 391 ascertain not only the absent spouse's
whereabouts but, more importantly,
of the Civil Code, an absence of only two
whether the absent spouse is still alive or
years shall be sufficient for purposes of
is already dead.
filing the petition for declaration of • Josephine's pursuit of Agapito is evidently
presumptive death. lackadaisical based on the following
circumstances:
• First, her personal knowledge of a growing AUTOMATIC TERMINATION OF 2ND

cyst on Agapito's jaw does not produce an MARRIAGE
inevitable conclusion that the latter was ✓ By the recording of the affidavit of
already suffering from some terminal illness reappearance of the absent spouse.
prior to his disappearance. No medical ✓ At the civil registry of the residence of the
document or expert testimony on Agapito's parties to the subsequent marriage.
physical ailment was submitted by
✓ With due notice to the parties of the
Josephine for the courts' assessment to
prove such circumstance.
subsequent marriage.
• Second, while Josephine attempted to find ✓ Unless there is a judgment annulling the
Agapito, her supposed informers and their previous marriage or declaring it void ab
information were unreliable. The "friends" initio.
whom Josephine allegedly contacted were ✓ Without prejudice to fact of reappearance
unnamed. The letters written by Josephine being judicially determined if disputed.
and Agapito's sister, Lydia Bueno Pilapil
(Lydia), were never presented as evidence VOID SUBSEQUENT MARRIAGE WHICH
before the court. Lydia did not even take the WAS CONTRACTED AFTER
witness stand to testify to the veracity of the DECLARATION OF PRESUMPTIVE
contents of her purported letter as alleged by DEATH
Josephine. Marites Longakit Toong “If both spouses of the subsequent marriage
(Marites), Josephine's letter-courier to Lydia, acted in bad faith, said marriage shall be
did appear as a witness before the trial
void ab initio xxx”
court; however, the truth behind Marites'
statements that Lydia had told her of D. VOIDABLE MARRIAGES
Agapito's absence remain hearsay and
unconfirmed.
A marriage may be annulled for any of the
• Third, Josephine could have resorted to
police assistance in seeking out her following causes, existing at the time of the
husband. While the act of seeking marriage:
investigative aid from authorities will not (1) 18 years old but below 21 without
automatically secure a positive conclusion of parental consent
a "diligent search," official documents could (2) Insanity
still have been procured to attest that she (3) Vitiated consent due to Fraud
had assiduously investigated the (4) Vitiated consent due to Force,
disappearance of Agapito. Josephine never intimidation or undue influence
did so. This further weakened the (5) Impotency
seriousness of her efforts to find her missing (6) Sexually transmissible Disease
husband and blurred the possibility of the
latter's death. Four Circumstances of Fraud
• Withal, the pieces of evidence on record
(1) Non-disclosure of a previous conviction
were too bare and self-serving. Mere
by final judgment of the other party of a
allegation is not proof. Moreover,
Josephine's acts fail to convince the Court crime involving moral turpitude;
that she indeed went out of her way to locate (2) Concealment by the wife of the fact that
Agapito, and her search for Agapito's at the time of the marriage, she was
whereabouts cannot be said to have been pregnant by a man other than her
diligently and exhaustively conducted. In all, husband;
Josephine's efforts were just too flimsy to (3) Concealment of sexually transmissible
serve as concrete basis of a well-founded disease, regardless of its nature, existing
belief that Agapito is indeed dead. at the time of the marriage; or
• A declaration of presumptive death must be (4) Concealment of drug addiction, habitual
predicated upon a wellfounded fact of death. alcoholism or homosexuality or
The fact that the absent spouse is merely lesbianism existing at the time of the
missing, no matter how certain and marriage.
undisputed, will never yield a judicial
presumption of the absent spouse's death.
No other misrepresentation or deceit as to
Josephine in this case only successfully
established that the whereabouts of Agapito character, health, rank, fortune or chastity
are indeterminable. As circumstances that shall constitute such fraud as will give
definitely suggest Agapito's death remain to grounds for action for the annulment of
be seen, the Court cannot consider marriage.
Josephine's civil status as that of a widow.
ARTICLE 45 VS. ARTICLE 46 OF THE FC *UNLESS such party afterwards, with full
ON STD AS GROUND FOR ANNULMENT knowledge of the facts constituting the fraud,
freely cohabited with the other as husband
Article 45 Article 46 and wife
4) Force, Intimidation, Undue Influence - by
Affliction Concealment
the injured party, within five years from the
Ground of Annulment time the force, intimidation or undue
influence disappeared or ceased;
The fact of being The act of concealing *UNLESS the same having disappeared or
afflicted because it constitutes ceased, such party thereafter freely
fraud cohabited with the other as husband and
wife
Concealment 5) Impotency and STD - by the injured party,
within five years from the celebration of
Not Necessary Necessary
marriage.
Nature of the Disease
GROUNDS FOR DENIAL
Must be serious and Does not have to be • Article 45, Family Code: CONVALIDATION
incurable serious and incurable Note: Voidable marriages due to incurable
Impotency and STD cannot be convalidated,
BAR QUESTION (2017) but action may prescribe five years from
celebration of marriage.
State whether the following marital unions are • Article 47, Family Code: PRESCRIPTION
valid, void, or voidable. • Article 47, Family Code: NOT FILED BY
Ador and Becky’s marriage wherein Ador was PROPER PERSON
afflicted with AIDS prior to the marriage
BAR QUESTION (2007)
SUGGESTED ANSWER
Write “TRUE” if the statement is true or
The marriage of Ador and Becky is a voidable “FALSE” if the statement is false. If the
marriage under paragraph (6) of Article 45 of statement is FALSE, state the reason.
the Family Code which provides that a The day after John and Marsha got married,
marriage is voidable if either party was afflicted John told her that he was impotent. Marsha
with a sexually transmissible disease found to continued to live with John for 2 years. Marsha
be serious and appears incurable. Since Ador is now estopped from filing an annulment case
was afflicted with AIDS even prior to the against John.
marriage, which is a serious and incurable
sexually transmissible disease, his marriage to SUGGESTED ANSWER
Becky is considered voidable
FALSE. Marsha is not estopped from filing an
annulment case against John on the ground of
Grounds | Who may file the case & When
his impotence.
1) Lack of parental consent – spouse whose
Physical incapacity to consummate is a valid
parent or guardian did not give his or her
ground for the annulment of marriage if such
consent, within five years after attaining the
incapacity was existing at the time of the
age of twenty-one, or by the parent or
marriage, continues and appears to be
guardian or person having legal charge of
incurable. The marriage may be annulled on
the minor, at any time before such party has
this ground within five years from its
reached the age of twenty-one;
celebration, and cohabitation upon knowledge
**UNLESS after attaining the age of twenty-
of impotency will not result in convalidation.
one, such party freely cohabited with the
other and both lived together as husband
and wife. BAR QUESTION (2011)
2) Insanity - by the sane spouse, who had no
Baldo, a rejected suitor, intimidated Judy into
knowledge of the other's insanity; or by any
marrying him. While she wanted to question the
relative or guardian or person having legal
validity of their marriage two years after the
charge of the insane, at any time before the
intimidation ceased, Judy decided in the
death of either party, or by the insane
meantime to freely cohabit with Baldo. After
spouse during a lucid interval or after
more than 5 years following their wedding,
regaining sanity;
Judy wants to file a case for annulment of
**UNLESS such party after coming to
marriage against Baldo on ground of lack of
reason, freely cohabited with the other as
consent. Will her action prosper?
husband and wife
(A) Yes, the action for annulment is
3) Fraud - by the injured party, within five years
imprescriptible.
after the discovery of the fraud;
BAR QUESTION (2011) F. FOREIGN MARRIAGES

(B) No, since the marriage was merely voidable
and Judy ratified it by freely cohabiting with Marriages Celebrated Abroad
Baldo after the force and intimidation had General Rule: If the marriage is valid abroad, it is
ceased . also valid in the Philippines.
(C) No, since the action prescribed 5 years Exceptions:
1. Art 35 (1) -lack of legal capacity
from the date of the celebration of the marriage.
2. Art 35 (4) - bigamous or polygamous marriage
(D) Yes, because the marriage was celebrated
3. Art 35 (5) - mistake as to identity
without Judy's consent freely given.
4. Art 35 (6) – non-compliance with registration
SUGGESTED ANSWER 5. Art 36 – psychological incapacity
6. Art 37 – incestuous marriage
(B) No, since the marriage was merely voidable 7. Art 38 – void due to public policy
and Judy ratified it by freely cohabiting with
Baldo after the force and intimidation had G. LEGAL SEPARATION
ceased
• Legal separation is a legal remedy available to
PENDENCY OF CASE AND ROLE OF parties in a valid but failed marriage for the
PUBLIC PROSECUTORS purpose of obtaining a decree from the court
• In cases of annulment or declaration of entitling him or her certain reliefs such as the
absolute nullity of marriage, the court shall right to live separately from each other
order the prosecuting attorney or fiscal (without affecting the marital bond that exists
assigned to appear on behalf of the State to between them), the dissolution and liquidation
take steps to prevent collusion between the of their absolute community or conjugal
parties, and to take care that evidence is partnership property regime and the custody of
not fabricated or suppressed. their minor children.
• No judgment shall be based on stipulation • It is in the nature of bed and board separation.
of facts or confession of judgment.
GROUNDS FOR LEGAL SEPARATION
• During the pendency, in the absence of
a. Repeated physical violence or grossly
written agreement, Court shall provide for abusive conduct against petitioner, common
support of spouses and custody and child, or a child of the petitioner;
support of common children. (Arts. 48&49, b. Attempt to corrupt or induce petitioner, a
FC) common child or a child of the petitioner to
engage in prostitution, or connivance in such
E. EFFECT OF DEFECTIVE corruption or inducement;
MARRIAGES c. Attempt by respondent against the life of the
petitioner;
d. Final judgment sentencing respondent to
EFFECTS OF DECREE OF ANNULMENT imprisonment of more than 6 years, even if
1. Termination of the marital bond; pardoned;
2. Children conceived or born before the e. Drug addiction or habitual alcoholism of
judgment of annulment has become final respondent;
and executory are considered legitimate; f. Physical violence or moral pressure to
3. Absolute community property regime or compel petitioner to change religious or
the conjugal partnership property regime is political affiliation;
terminated or dissolved and the same shall g. Bigamous marriage subsequently contracted
by respondent in the Philippines or abroad;
be liquidated. Forfeiture of guilty spouse’s
h. Sexual infidelity or perversion;
share in net profits.
i. Lesbianism or homosexuality;
4. The innocent spouse may revoke the j. Abandonment of petitioner by respondent
designation of the other spouse who acted without justifiable cause for more than a year.
on bad faith as beneficiary in the insurance
policy whether or not the designation is DEFENSES
revocable. Condonation
5. The spouse who contracted the marriage • It is forgiveness of the offense by the innocent
in bad faith, shall be disqualified to inherit spouse, express or implied, subject to the
from the innocent spouse by testate or condition shall not be repeated.
intestate succession; • Having sex with the spouse after knowledge of
6. Donation Propter Nuptias – remains the other’s infidelity (Ginez vs. Bugayong)
Valid, except donee spouse acted in bad • Every adulterous act of the wife is a separate
ground for legal separation and condonation of
faith, it is revoked by operation of law.
one does not necessarily mean condonation of
the others (People vs. Zapata).
Consent SUGGESTED ANSWER

• It is where offended party agreed to the
commission of the offense. This is given in FALSE. The five-year prescriptive period for
advance or prior to commission. filing legal separation runs from the occurrence
of sexual infidelity committed in 2002 runs from
Connivance 2002, for the sexual infidelity committed in
• It implies an agreement, express or implied, 2003, the prescriptive period runs from 2003
by both spouses to the ground for legal and so on. The action for legal separation for
separation. the last act of sexual infidelity in 2005 will
prescribe in 2010.
Collusion
• It also implies an agreement of spouses PROCEDURE, EFFECTS OF FILING,
whereby one will commit or appear to commit, EFFECTS OF PENDENCY
or to be represented in court as having Immediately Entitled to Live Separately
committed, an offense which is a ground for • After the filing of petition for legal separation,
legal separation, or to suppress evidence of the spouses shall be entitled to live
valid defense, for the purpose of enabling the separately from each other.
other to obtain a legal separation. • The court, in the absence of agreement, shall
designate either of them or a third person to
Mutual recrimination (in pari delicto) administer the absolute community or
• When both parties have given ground for conjugal partnership property. (Art. 61, FC)
legal separation.
Cooling-Off Period
Prescription • An action for legal separation shall be in no
• When the action is not filed within the period case tried before 6 months shall have
fixed by law. elapsed since the filing of the petition. (Art.
• An action for legal separation shall be filed 58, FC).
within five (5) years from the time of the • To enable the contending spouses to settle
occurrence of the cause (Art. 57, FC). differences. In other words, it is for possible
reconciliation
BAR QUESTION (2012) • XPN: There is no cooling-off period if the
After they got married, Nikki discovered that grounds alleged are those under R.A. 9262.
Christian was having an affair with another
woman. But Nikki decided to give it a try and Steps Toward Reconciliation
lived with him for two (2) years. No legal separation may be decreed unless the
After two (2) years, Nikki filed an action for Court has taken steps toward the reconciliation
legal separation on the ground of Christian’s of the spouses and is fully satisfied, despite such
sexual infidelity. Will the action prosper? efforts, that reconciliation is highly improbable.
Explain. (Art. 59, FC).
SUGGESTED ANSWER Support and Custody

Although the action for legal separation has not • During the pendency of the action for legal
yet prescribed, the prescriptive period being 5 separation, the provisions of Article 49 shall
years, if Christian’s affair with another woman likewise apply to the support of the spouse
was ended when Nikki decided to live with him and the custody and support of common
again, Nikki’s action will not prosper on account children. (Art. 62, FC).
of condonation. However, if such affair is still • Court shall provide for support of spouses
continuing, Nikki’s action would prosper and custody and support of common children.
because the 5-year prescriptive period will be • Paramount consideration to the moral and
counted from the latest act of sexual infidelity. material welfare of children and their choice
Every act of sexual liaison is a ground for legal of parent with whom they wish to remain.
separation. • Shall also provide for visitation rights of the
other parent. (Art 49, FC)
BAR QUESTION (2012) Role of Fiscal

✓ No decree of legal separation shall be based
Write “TRUE” if the statement is true or
upon a stipulation of facts or a confession of
“FALSE” if the statement is false. If the
judgement.
statement is FALSE, state the reason.
✓ The court should order the prosecuting
If a man commits several acts of sexual
attorney or fiscal to take steps to prevent
infidelity, particularly in 2002, 2003, 2004,
2005, the prescriptive period to file for legal collusion between the parties and to take care
that the evidence is not fabricated or
separation runs from 2002.
suppressed. (Art 60, FC)
EFFECTS OF DECREE OF LEGAL H. PROPERTY RELATIONS

SEPARATION BETWEEN SPOUSES
1. The spouses are entitled to live separately
but the marriage bond is not severed. Marriage Settlement
2. ACP/GCP shall be dissolved and liquidated. • It is a contract entered into by a man and a
Offending spouse forfeits share in net profits. woman who intend or plan to get married
Regime of complete separation. fixing the property regime that will govern
3. Custody of minor children shall be awarded their present and future properties during
to innocent spouse, subject to Art. 213
their marriage.
FC.(Court will designate, take into account
• It is also called ante-nuptial or pre-nuptial
relevant considerations, especially the choice
agreement.
of the child over 7 years unless the parent
chose is unfit. Tender age presumption.)
4. Offending spouse is disqualified to inherit
Requisites of a valid marriage settlement
from innocent spouse by intestate a. In writing;
succession. b. Signed by the parties;
5. Provisions in the will of innocent spouse c. Executed before the celebration of
which favors offending spouse shall be marriage;
revoked by operation of law. (Art 63, FC) d. Signed by parent/guardian - If 18-21, civil
6. Innocent spouse may revoke the designation interdiction, disability (Arts 78 and 79, FC)
of the offending spouse as a beneficiary in • Registration (to bind 3rd persons).
any insurance policy, even when stipulated (Art. 77, FC)
as irrevocable. (Art 64, FC)
7. The innocent spouse may revoke donations Modification of the marriage settlement
she/he made in favor of the offending spouse. For any modification in the marriage settlement:
Action to revoke must be brought within 5 a. The requisites for valid marriage settlement
years from finality of decree of legal must be present;
separation. (Art 64, FC) b. There must be judicial approval; and
8. Obligation to give support ceases, but court c. Subject to provisions of Arts. 66, 67, 128,
may order the guilty spouse to give support to 135, and 136 of the FC.
the innocent spouse. (Art. 198, FC)
1. DONATION PROPTER NUPTIAS
Reconciliation - Also known as donation by reason of
✓ If the spouses should reconcile, a
marriage.
corresponding joint manifestation under oath duly
signed by them shall be filed with the court in the
Requisites:
same proceeding for legal separation.
1. Made before the celebration of the
✓ The legal separation proceedings, if still
pending, shall thereby be terminated at whatever marriage;
stage. Final decree shall be set aside. 2. Made in consideration of marriage; and
✓ Reconciliation does not automatically revive 3. Made in favor of one or both of the future
the former property regime. spouses.
✓ If the spouses want to revive the previous 4. Governed by ordinary donations.
property regime, they must execute an
agreement under oath to revive the former ✓ If agreed property regime is other than
property regime, which agreement shall be absolute community property, the donation in
submitted in court, together with a verified motion the marriage settlement should not be more
for its approval. (Arts. 66-67, FC) than 1/5 of the present property of the future
spouse
SY VS. EUFEMIO | G.R. No. L-30977, January ✓ Donation of future property is governed by
31, 1972 testamentary succession and formalities of will.
Effect of Death of One of the Parties
Abates the Action: Grounds for revocation of donations
✓ The death of one of the parties before final propter nuptias (Article 86)
decree in an action for legal separation abates 1. Non-celebration of marriage
the action. 2. Celebration of marriage without parental
✓ An action for legal separation which involves consent;
nothing more than the bed-and-board separation 3. Annulment of marriage with donee acting in
of the spouses (there being no absolute divorce bad faith;
in this jurisdiction) is purely personal. 4. Legal separation with donee as the guilty
✓ Being personal in character, it follows that the party;
death of one party to the action causes the death
5. Fulfillment of resolutory condition; and
of the action itself — actio personalis moritur cum
6. Acts of ingratitude (Article 765, FC).
persona.
2. VOID DONATIONS BY THE SPOUSE 3. Debts and obligations contracted by either

General Rule: Every donation or grant of spouse without the consent of the other to
gratuitous advantage, direct or indirect, between the extent that the family may have been
the spouses during marriage shall be VOID benefited;
XPN: moderate gifts which the spouses may 4. All taxes, liens, charges, and expenses,
give each other on the occasion of any family including major or minor repairs, upon the
rejoicing. The prohibition shall also apply to community property;
persons living together as husband and wife 5. All taxes and expenses for mere
without valid marriage. (Article 87, FC) preservation made during the marriage upon
the separate property of either spouse used
3. ABSOLUTE COMMUNITY OF by the family;
PROPERTY REGIME 6. Expenses to enable either spouse to
• A property regime wherein the spouses are commence or complete a professional or
considered co-owners of all property brought vocational course or other activity for self-
into the marriage as well as those acquired improvement;
during the marriage, which are not otherwise 7. Ante-nuptial debts of either spouse insofar
excluded from the community either by the as they have redounded to the benefit of the
provisions of the Family Code or by the family;
marriage settlement. 8. The value of what is donated or promised by
both spouses in favor of their common
Properties Excluded Under the Absolute legitimate children for the exclusive purpose
Community of commencing or completing a professional
1. Property acquired during the marriage by or vocational course or other activity for self-
gratuitous title and its fruits as well as improvement; (2007 BAR)
income thereof unless the grantor expressly 9. Payment, in case of absence or insufficiency
provided that they shall form part of the of the exclusive property of the debtor-
community property; spouse, of:
2. Property for personal and exclusive use of Note: The payment of which shall be
either spouses, except jewelry which shall considered as advances to be deducted from
form part of the absolute community because the share of the debtor-spouse upon
of their monetary value; liquidation of the community.
3. Property acquired before the marriage by 10. Expenses of litigation between the spouses.
one with legitimate descendants by former However, if the suit is found to be
marriage and its fruits and income, if any; groundless, it cannot be charged against the
4. Those excluded by the marriage settlement absolute community (Art. 94,FC).
(Art. 92, FC).
5. (2019 Bar asked for at least two exclusions) Administration of Community Property
General Rule: The administration of community
Properties Included in the Absolute property belongs to both spouses jointly.
Community Exceptions:
1. All the property owned by the spouses at the 1. Agreement that only one of the spouses
time of celebration of marriage or acquired shall administer the community property;
thereafter; 2. If one spouse is incapacitated or otherwise
2. Property acquired during the marriage by unable to participate in the administration of
gratuitous title, if expressly made to form part the common properties, capacitated or able
of the community property by the donor, spouse may assume sole powers of
testator or grantor; administration without the need of court
3. Jewelry or properties with monetary value; approval of authorization;
and 3. If a spouse without just cause abandons the
4. Winnings in gambling. other or fails to comply with his or her
obligations to the family, the aggrieved
CHARGES UPON AND OBLIGATIONS OF spouse may petition the court for sole
THE ABSOLUTE COMMUNITY PROPERTY administration;
1. Support of the spouses, their common 4. During the pendency of the legal separation
children, and legitimate children of either case, the court may designate either of the
spouses; spouses as sole administrator.
2. All debts and obligations contracted during
the marriage by: Note: Administration does not include:
a. the designated administrator-spouse for 1. Disposition;
the benefit of the community 2. Alienation; and
b. by both spouses; 3. Encumbrance of the conjugal or community
c. by one spouse with the consent of the property
other.
Disagreement in the administration of 4. CONJUGAL PARTNERSHIP OF

community property (Article 96, FC) GAINS REGIME
In case of disagreement, the decision of the
husband shall prevail but subject to recourse to
It is the property relation by the husband
the court by the wife for proper remedy.
and the wife by placing in a common fund:
Note: Prescriptive period for recourse is within 5 (FC, Art. 106)
years from the date of the contract implementing 1. Proceeds, product, fruits and income of
such decision. their separate properties;
2. Those acquired by either or both of
SPS. ANTONIO V. CA | G.R. No. 125172, June them through:
25, 1998
a. Effort;
Sale or Disposition of Community Property
Article 96 and 124 of the Family Code b. Chance.
Alienation or encumbrance of community
property must have the written consent of the Exclusive property of the spouses
other spouse or the authority of the court without (Article 109, FC)
which the disposition or encumbrance is VOID. 1. Those brought into the marriage as
However, the transaction shall be construed as a his/her own;
continuing offer on the part of the consenting
2. Those acquired during the marriage
spouse and the third person, and may be
perfected as binding contract upon the
by gratuitous title;
acceptance by the other spouse or authorization 3. Those acquire by right of redemption,
by the court before the offer is withdrawn by barter, or exchange with exclusive
either or both offerors. property;
4. That purchased with exclusive money
BAR QUESTION (2012) of either spouse.
Danny and Elsa were married in 2002. In • (2019 Bar asked for at least two
2012, Elsa left the conjugal home and her exclusions)
two minor children with Danny to live with
her paramour. Conjugal Partnership Property
In 2015, Danny sold without Elsa’s consent (1) Those acquired by onerous title
a parcel of land registered in his name that during the marriage with conjugal
he had purchased prior to the marriage. funds;
Danny used the proceeds of the sale to pay (2) Those obtained from the labor,
for his children’s tuition fees. industry, work or profession of
either or both of the spouses;
Is the sale valid, void, or voidable? (3) Fruits of conjugal property due or
Explain your answer. received during the marriage and
SUGGESTED ANSWER net fruits of separate property;
(4) Share of either spouse in hidden
The sale made by Danny is void. The treasure;
parties were married after the effectivity of (5) Those acquired through occupation
the Family Code where the default property
such as fishing or hunting;
regime is absolute community of property.
(6) Livestock in excess of the number
The facts did not mention that the parties
of each kind brought to the
executed a marriage settlement, hence, the
marriage; and
default property regime of absolute
community of property shall govern their (7) Those acquired by chance, such as
property relations. winnings from gambling or betting.
Under this property regime, all properties Alienation of exclusive properties of

which each of the spouses own at the time either spouse
of the celebration of the marriage as well as Either spouse may mortgage, encumber,
whatever they may acquire thereafter shall alienate or otherwise dispose of his or her
form part of the absolute community. And exclusive property. (FC, Art. 111 as
sale of a community property by one amended by R.A.10572)
spouse without consent of the other is void.
(Art. 96, Family Code).
RULES IN CASES OF IMPROVEMENT

CHARGES UPON AND OBLIGATIONS OF
OF EXCLUSIVE PROPERTY (ARTICLE THE CONJUGAL PARTNERSHIP OF GAINS
120) (1) Support of the spouses, their common
children, and the legitimate children of
Reverse accession either spouse;
• if the cost of the improvement and the (2) Debts and obligations contracted by one
resulting increase in value is more than without the consent of the other to the
the value of the principal property at the extent that the family benefited;
time of the improvement, the entire (3) Debts and obligations contracted during
property becomes conjugal. the marriage by an administrator-spouse
for the benefit of the family, or both
spouses or by one of them with the
Accession
consent of the other;
• if the cost of the improvement and the (4) Taxes, liens, charges, and expenses,
resulting increase in value is equal to or including major or minor repairs upon the
less than the value of the principal conjugal property;
property at the time of the improvement, (5) Taxes and expenses for mere preservation
the entire property becomes exclusive made during the marriage of separate
property of the respective spouse. property;
(6) Expenses for professional, vocational, or
Note: In either case, there shall be other activity for self-improvement of either
reimbursement upon the liquidation of the spouse;
conjugal partnership and ownership of (7) Ante-nuptial debts to the extent the family
entire property of the respective property has been benefited;
(8) Value of what is donated or promised to
shall be vested only upon reimbursement.
common legitimate children for
professional, vocation or self-improvement
Presumption of inclusion of property in courses; and
the Conjugal Partnership of Gains (9) Expenses of litigation between the
spouses unless the suit is found to
General Rule: All property acquired groundless.
during the marriage, whether the
acquisition appears to have been made, Note: If the conjugal partnership is insufficient
contracted or registered in the name of to cover the foregoing liabilities, spouses shall
one or both spouses, is presumed to be be solidarily liable for the unpaid balance with
conjugal. their separate properties.
Levy On Conjugal Property

XPN: Unless the contrary is proved.
- If levy was made on the conjugal property by
reason of the husband being the guarantor,
Property bought through the levy is improper.
INSTALLMENT (Article 118, FC)
General Rule: The payment of personal debts
1. If full ownership was vested before contracted by the husband or the wife before
the marriage – it shall belong to the or during the marriage shall not be charged to
buyer spouse. the conjugal partnership except as they
redounded to the benefit of the family (Article
2. If full ownership was vested during 122 FC).
the marriage – it shall belong to the
CHARGES AGAINST THE SEPARATE
conjugal partnership.
PROPERTY (CPG MAY ADVANCE
SUBJECT TO CHARGE DURING
LIQUIDATION, ARTICLE 122 FC):
Note: In either case, any amount 1. Personal debts of either spouse contracted
advanced by the partnership or by either before the marriage which did not redound
or both spouses shall be reimbursed by to the benefit of the family; and
the owner/s upon liquidation of the 2. Support of the illegitimate children of either
partnership. spouse;
3. Fines and indemnities arising from
delicts and quasi-delicts.
Administration of the Conjugal Exceptions:

Partnership of Gains (Article 124) 1. spouse who leaves the conjugal home
General Rule: The administration and or refuses to live therein, without just
enjoyment of the conjugal partnership shall cause, has no right to be supported;
belong to both spouses jointly. 2. When consent of one spouse to any
In case of disagreement, the decision of transaction of the other is required by
the husband shall prevail subject to law, judicial authorization must be
recourse to the court by the wife for proper obtained;
remedy. 3. If community property is insufficient, the
separate property of both spouses shall
Note: Prescriptive period for recourse is 5 be solidarily liable for the support of the
years from the date of the contract family.
implementing such decision. (2000, 2002
BAR) Complete Separation of Property
(CSOP)
Joint Administration of the Conjugal - The system of CSOP will govern the
Partnership of Gains (Article 124) property relations between the spouses
Exceptions: only in the following cases:
1. If one spouse is incapacitated or 1. When it is expressly provided for in the
otherwise unable to participate in the marriage settlement;
administration of the common 2. When it is so decreed by the court
properties – capacitated or able spouse (Legal Separation, Judicial Sep of
may assume sole powers of Property);
administration. 3. Mandatory regime of complete
2. If a spouse without just cause abandons separation of property -- By failure of
the other or fails to comply with his or the surviving spouse to liquidate the
her obligations to the family, the absolute community or conjugal
aggrieved spouse may petition the court partnership of gains of a previous
for sole administration. marriage which has been terminated by
3. During the pendency of a legal death within the one-year period
separation case, the court may required by law prior to contracting
designate either of the spouse as sole another marriage. The subsequent
administrator. marriage is mandatorily governed by a
regime of complete separation.
But administration does not include:
a. Disposition Rights of the spouses under the regime
b. Alienation; or of separation of property
c. Encumbrance of the conjugal or 1. Each spouse shall own, dispose of,
community property. possess, administer and enjoy his or
her own separate estate, without need
Dissolution of Conjugal Partnership of of the consent of the other.
Gains 2. Each spouse shall own all earnings
1. Death; from his or her profession, business or
2. Legal Separation; industry and all fruits, natural, industrial
3. Annulment or civil, due or received during the
4. Declaration of Nullity under Article 40; marriage from his or her separate
5. Judicial separation of property during property (Article 145, FC).
marriage (Article 135-136, FC).
Liabilities of the spouses for family
5. SEPARATION OF PROPERTY REGIME expenses under the regime of
separation of property (Article 145, FC)
Effect of Separation In Fact Between ✓ Both spouses shall bear the family
Husband and Wife expenses in proportion to their income.
General Rule: Such separation does not ✓ In case of insufficiency or default thereof,
affect the regime of absolute community or to the current market value of their
conjugal partnership or any agreed regime separate properties.
6. PROPERTY REGIME OF UNIONS WITHOUT MARRIAGE

BASIS ARTICLE 147 ARTICLE 148
Applicability 1. Parties without legal impediment With legal impediment caused by:
to marry; Adulterous relationships; Bigamous /
2. Void marriage on the ground of polygamous marriages; Incestuous void
psychological incapacity. marriages under Art. 37; Void marriages
by reason of public policy (FC, Art. 38)
As to requisites 1. The man and the woman must be 1. The man and the woman must be
capacitated to marry each other; incapacitated to marry each other; or
2. Lived exclusively with each other they do not live exclusively with each
as husband and wife; and other as husband and wife; and
3. Their union is without the benefit 2. Their union is without the benefit of
of marriage/void marriage. marriage/void marriage.
As to Salary/ Wages Owned in equal shares. Separately owned by the parties. If any
is married, his/her salary pertains to the
ACP/ CPG of the legitimate marriage.
Property exclusively Belongs to party upon proof of Belongs to such party upon proof of
acquired acquisition through exclusive funds. acquisition through exclusive funds.
Property acquired by both Governed by rules on co-ownership. Owned in common in proportion to their
through their work or respective contributions.
industry during
cohabitation
Share Efforts in the care and maintenance Actual joint contribution of money,
of family and household are property or industry shall be owned by
considered equal contribution them in common proportion.
Contributions are presumed equal in the
absence of proof to the contrary.
Forfeiture (If BF) If one is validly married to another –
1. Common children share accrue to the ACP/CPG of
2. Default/waiver by any or all of the existing in the marriage.
common children or their
descendants, each vacant share to If (BF) is not validly married to another
respective surviving descendants or both in (BF) – forfeited in the manner
3. Innocent party provided in the last par. of Art. 147.
Encumber of Sell Without Consent

General Rule: Neither may encumber of sell without consent.
✓ Share in the property acquired during cohabitation cannot be encumbered or sold without consent
of the other
✓ Encumbrance or sale without consent of one party is VOID.
BAR QUESTION (2012)

In December 2000, Michael and Anna, after obtaining a valid marriage license, went to the Office of
the Mayor of Urbano, Bulacan, to get married. The Mayor was not there, but the Mayor’s secretary
asked Michael and Anna and their witnesses to fill up and sign the required marriage contract forms.
The secretary then told them to wait, and went out to look for the Mayor who was attending a wedding
in a neighboring municipality. When the secretary caught up with the Mayor at the wedding reception,
she showed him the marriage contract forms and told him that the couple and their witnesses were
waiting in his office. The Mayor forthwith signed all the copies of the marriage contract, gave them to
the secretary who returned to the Mayor’s office. She then gave copies of the marriage contract to the
parties, and told Michael and Anna that they were already married. Thereafter, the couple lived
together as husband and wife, and had three sons.
(C). What property regime governs the properties acquired by the couple? Explain.
SUGGESTED ANSWER 7. JUDICIAL SEPARATION OF

The marriage being void, the property PROPERTY
relationship that governed their union is special • In the absence of an express declaration in the
marriage settlements, the separation of property
co-ownership under Article 147 of the Family
between spouses during the marriage shall not
Code. This is on the assumption that there was
take place except by judicial order.
no impediment for them to validity marry each • Such judicial separation of property may either
other. be voluntary or for sufficient cause. (FC, Art.
134).
BAR QUESTION (2016)
Sufficient causes for Judicial Separation of
Bernard and Dorothy lived together as
Property
common-law spouses although they are both (1) Civil interdiction;
capacitated to marry. After one year of (2) Judicially declaration of absence;
cohabitation, Dorothy went abroad to work in (3) Loss of parental authority as decreed by the
Dubai as a hair stylist and regularly sent court;
money to Bernard. (4) Abandonment or failure to comply with family
obligations;
With the money, Bernard bought a lot. For a (5) Administrator spouse has abused authority;
good price, Bernard sold the lot. Dorothy and
came to know about the acquisition and sale (6) Separation in fact for one year and
reconciliation is highly improbable (FC, Art.
of the lot and filed a suit to nullify the sale
135).
because she did not give her consent to the Note: In cases provided in 1, 2 and 3, the
sale. presentation of the final judgment against the guilty
or absent spouse shall be enough bases for the
Will Dorothy’s suit prosper? grant of the decree of judicial separation of
property.
SUGGESTED ANSWER
Yes, Dorothy’s suit will prosper. Under Article Effects of Judicial Separation of Property
147, if the parties who are capacitated to Between Spouses
marry each other live exclusively with each 1. The absolute community or conjugal
partnership is dissolved;
other as husband and wife without the benefit
2. The liability of the spouses to creditors shall be
of marriage or under a void marriage, their solidary with their separate properties;
wages and salaries shall be owned by them 3. Mutual obligation to support each other
in equal shares and the property acquired by continues except when there is legal
both of them through their work or industry separation;
shall be governed by the rules of co- 4. Rights previously acquired by creditors are not
ownership. prejudiced.
Clearly, Dorothy and Bernard’s union is Voluntary Separation of Property (Article 136)
covered by Article 147 and neither party can • In case of voluntary agreement for the
separation of property, the law does not require
encumber or dispose by acts inter vivos of
specific reasons to justify the Court in approving
his or her share in the property acquired
the same.
during cohabitation and owned in common • The law leaves the matter to the discretion of
without the consent of the other, until after the court. (2005 BAR)
the termination of the cohabitation. • It will take effect only once approved or decreed
by the court.
Suppose Dorothy was jobless and did not
contribute money to the acquisition of the Revival of previous property regime
lot and her efforts consisted mainly in the • If the spouses opted for voluntary separation of
care and maintenance of the family and property, the parties may agree to the revival
household, is her consent to the sale a even in the absence of a reason/ground.
prerequisite to its validity? • However, a subsequent voluntary separation of
Yes, even if Dorothy was not working and did property is no longer allowed.
not contribute money for the acquisition of • If the separation of property is for a sufficient
the lot, her consent would still be necessary cause, the revival of the previous property
because under Article 147, a party who did regime depends upon the cessation of the
ground which was the basis of the judicial
not contribute in the acquisition of the
order.
property acquired during cohabitation shall  A subsequent judicial separation of
still be deemed to have contributed jointly in property for a sufficient cause may be
its acquisition if his or her efforts consisted in allowed so long as there is a new ground
the care and maintenance of the household. to rely on.
I. THE FAMILY J. THE FAMILY HOME
1. GENERAL PRINCIPLES 1. GENERAL PRINCIPLES

‘Family’ defined The family home, constituted jointly by the
Art. 149. The family, being the foundation of husband and the wife or by an unmarried head
the nation, is a basic social institution which of a family, is the dwelling house where they and
public policy cherishes and protects. their family reside, and the land on which it is
Consequently, family relations are governed situated. (Art. 152 FC)
by law and no custom, practice or agreement
destructive of the family shall be recognized or How is a Family Home Established
given effect. • Art. 153. The family home is deemed
constituted on a house and lot from the time it
Family Relations is occupied as a family residence.
Family relations include: From the time of its constitution and so long
as any of its beneficiaries actually resides
1. Between husband and wife;
therein, the family home continues to be such
2. Between parents and children;
and is exempt from execution, forced sale or
3. Among other ascendants and
attachment except as hereinafter provided
descendants;
and to the extent of the value allowed by law.
4. Among brothers and sisters, whether of the • Art. 156. The family home must be part of the
full or half-blood (FC, Art.150) properties of the absolute community or the
✓ The law governs family relations. conjugal partnership, or of the exclusive
✓ No custom, practice or agreement which is properties of either spouse with the latter’s
destructive of the family shall be recognized or consent. It may also be constituted by an
given any effect. unmarried head of a family on his or her own
property.
Presumptions Nevertheless, property that is the subject of a
General Rule: In case of doubt, all conditional sale on installments where
presumptions favor the solidarity of the family. ownership is reserved by the vendor only to
Thus, every intendment of law or fact leans guarantee payment of the purchase price
toward the validity of marriage, the may be constituted as a family home.
indissolubility of the marriage bonds, the
legitimacy of children, the community of Art. 161. For purposes of availing of the benefits
property during marriage, the authority of of a family home as provided for in this Chapter,
parents over their children, and the validity of a person may constitute, or be the beneficiary of,
defense for any member of the family in case only one family home.
of unlawful aggression.
Beneficiaries of the Family Home
Can a Suit Be Filed Between Members of (1) The husband and wife, or an unmarried
the Same Family? person who is the head of a family; and
Art. 151. No suit between members of the (2) Their parents,
same family shall prosper unless it should (3) ascendants,
appear from the verified complaint or petition (4) Descendants
(5) brothers and sisters,
that earnest efforts toward a compromise have
whether the relationship be legitimate or
been made, but that the same have failed. If it
illegitimate, who are living in the family home
is shown that no such efforts were in fact
and who depend upon the head of the family for
made, the same case must be dismissed.
legal support. (Art 154 FC)
This rules shall not apply to cases which may Family Home Exempted
not be the subject of compromise under the Art. 155. The family home shall be exempt from
Civil Code. execution, forced sale or attachment except:
(1) For non-payment of taxes;
Article 2035. No compromise upon the (2) For debts incurred prior to the constitution of
following questions shall be valid: the family home;
(1) The civil status of persons; (3) For debts secured by mortgages on the
(2) The validity of a marriage or a legal premises before or after such constitution;
separation; and
(3) Any ground for legal separation; (4) For debts due to laborers, mechanics,
(4) Future support; architects, builders, materialmen and others
(5) The jurisdiction of courts; who have rendered service or furnished
(6) Future legitime. material for the construction of the building.
Value of Family Home that is Exempt K. PATERNITY AND FILIATION

Art. 157. The actual value of the family home
shall not exceed, at the time of its constitution, 1. CONCEPTS OF PATERNITY, FILIATION,
the amount of the three hundred thousand
AND LEGITIMACY
pesos in urban areas, and two hundred
thousand pesos in rural areas, or such
Paternity’ defined
amounts as may hereafter be fixed by law.
Paternity has been defined as the “civil status
• PHP 300,000 for URBAN AREAS.
of a father in relation to the child”
• PHP 200,000 for RURAL AREAS
‘Filiation’ defined
Remedy of Creditors
Art. 160. When a creditor whose claims is not • Filiation is defined as the “relationship or
among those mentioned in Article 155 obtains tie which exists between parents and their
a judgment in his favor, and he has children.”
reasonable grounds to believe that the family • Filiation may be by nature or adoption.
home is actually worth more than the
maximum amount fixed in Article 157, he may ‘Legitimacy’ defined
apply to the court which rendered the is the status of a child born to parents who
judgment for an order directing the sale of the are legally married to each other.
property under execution. The court shall so
order if it finds that the actual value of the 2. LEGITIMATE CHILDREN
family home exceeds the maximum amount
allowed by law as of the time of its a) Who are Legitimate Children
constitution. If the increased actual value • Children conceived or born during the
exceeds the maximum allowed in Article 157 marriage of the parents are legitimate.
and results from subsequent voluntary • Children conceived as a result of artificial
improvements introduced by the person or insemination of the wife with the sperm of
persons constituting the family home, by the the husband or that of a donor or both are
owner or owners of the property, or by any of likewise legitimate children of the husband
the beneficiaries, the same rule and procedure and his wife, provided, that both of them
shall apply. authorized or ratified such insemination in
a written instrument executed and signed
At the execution sale, no bid below the value by them before the birth of the child. The
allowed for a family home shall be considered. instrument shall be recorded in the civil
The proceeds shall be applied first to the registry together with the birth certificate of
amount mentioned in Article 157, and then to the child. (Art. 164 FC)
the liabilities under the judgment and the
costs. The excess, if any, shall be delivered to Exceptions: Born outside of a valid marriage
the judgment debtor. (void marriages) but considered as legitimate
child:
Disposal of Family Home a. Children of marriages which are declared
Art. 158. The family home may be sold, void under Art. 36; and
alienated, donated, assigned or encumbered b. Children of marriages which are declared
by the owner or owners thereof with the void under Art. 53.
written consent of the person constituting the
same, the latter’s spouse, and a majority of b) Proof of Filiation of Legitimate Children
the beneficiaries of legal age. In case of PRIMARY PROOFS
conflict, the court shall decide. (1) The record of birth appearing in the civil
register or a final judgment; or
Dissolution of Family Home (2) An admission of legitimate filiation in a
Art. 159. The family home shall continue public document or a private handwritten
despite the death of one or both spouses or of instrument and signed by the parent
the unmarried head of the family for a period concerned.
of ten years or for as long as there is a minor
beneficiary, and the heirs cannot partition the SECONDARY PROOFS
same unless the court finds compelling (1) The open and continuous possession of
reasons therefor. This rule shall apply the status of a legitimate child; or
regardless of whoever owns the property or (2) Any other means allowed by the Rules of
constituted the family home. Court and special laws. (FC, Art. 172)
c) Rights of Legitimate Children PRESCRIPTIVE PERIOD IN IMPUGNING

(1) To bear the surnames of the father and the LEGITIMACY
mother, in conformity with the provisions of Art. 170. The action to impugn the legitimacy
the Civil Code on Surnames; of the child shall be brought within one year
(2) To receive support from their parents, their from the knowledge of the birth or its recording
ascendants, and in proper cases, their in the civil register, if the husband or, in a
brothers and sisters, in conformity with the
proper case, any of his heirs, should reside in
provisions of this Code on Support; and
the city or municipality where the birth took
(3) To be entitled to the legitimate and other
successional rights granted to them by the place or was recorded.
Civil Code. (Art. 174 FC)
If the husband or, in his default, all of his heirs
d) Grounds to Impugn Legitimacy do not reside at the place of birth as defined in
1) That it was physically impossible for the the first paragraph or where it was recorded,
husband to have sexual intercourse with his the period shall be two years if they should
wife within the first 120 days of the 300 days reside in the Philippines; and three years if
which immediately preceded the birth of the abroad. If the birth of the child has been
child because of: concealed from or was unknown to the
(a) the physical incapacity of the husband to husband or his heirs, the period shall be
have sexual intercourse with his wife; counted from the discovery or knowledge of
(b) the fact that the husband and wife were the birth of the child or of the fact of
living separately in such a way that sexual registration of said birth, whichever is earlier.
intercourse was not possible; or
(c) serious illness of the husband, which
RULES WHEN A MOTHER CONTRACTED A
absolutely prevented sexual intercourse;
2) That it is proved that for biological or other
MARRIAGE WITHIN 300 DAYS FOLLOWING
scientific reasons, the child could not have TERMINATION OF FORMER MARRIAGE
been that of the husband, except in the Art. 168. If the marriage is terminated and the
instance provided in the second paragraph of mother contracted another marriage within
Article 164; or three hundred days after such termination of
3) That in case of children conceived through the former marriage, these rules shall govern
artificial insemination, the written in the absence of proof to the contrary:
authorization or ratification of either parent (1) A child born before one hundred eighty
was obtained through mistake, fraud, days after the solemnization of the
violence, intimidation, or undue influence. subsequent marriage is considered to have
been conceived during the former
BAR QUESTION (2012)
marriage, provided it be born within three
The husband may impugn the legitimacy of his hundred days after the termination of the
child but not on the ground that: former marriage;
a) the wife is suspected of infidelity. (2) A child born after one hundred eighty days
b) the husband had a serious illness that following the celebration of the subsequent
prevented him from engaging in sexual marriage is considered to have been
intercourse. conceived during such marriage, even
c) they were living apart. though it be born within the three hundred
d) he is physically incapable of sexual days after the termination of the former
intercourse. marriage.
SUGGESTED ANSWER
Art. 169. The legitimacy or illegitimacy of a
a) the wife is suspected of infidelity. child born after three hundred days following
WHO MAY IMPUGN LEGITIMACY the termination of the marriage shall be proved
General Rule: HUSBAND by whoever alleges such legitimacy or
Exception: illegitimacy.
Art. 171. The heirs of the husband may impugn
the filiation of the child within the period Presumption of Legitimacy
prescribed in the preceding article only in the Art. 167. The child shall be considered
following cases: legitimate although the mother may have
(1) If the husband should die before the declared against its legitimacy or may have
expiration of the period fixed for bringing his
been sentenced as an adulteress.
action;
(2) If he should die after the filing of the
complaint without having desisted therefrom; 3. ILLEGITIMATE CHILDREN
or Art. 165. Children conceived and born outside
(3) If the child was born after the death of the a valid marriage are illegitimate, unless
husband. (Art. 177 FC) otherwise provided in this Code.
a) Who are Illegitimate Children PRESCRIPTIVE PERIOD IN CLAIMING

1. Children conceived and born outside a valid ILLEGITIMATE FILIATION
marriage; • Art. 175. xxx The action must be brought
2. Children born of couples who are not legally within the same period specified in Article
married or of common law marriages; 173, except when the action is based on the
3. Children born of incestuous marriage; second paragraph of Article 172, in which
4. Children born of bigamous marriage; case the action may be brought during the
5. Children born of adulterous relations lifetime of the alleged parent.
between parents; • Art. 173. The action to claim legitimacy may
6. Children born of marriages which are void for be brought by the child during his or her
reasons of public policy under Art.38,FC; lifetime and shall be transmitted to the heirs
7. Children born of couples below 18; should the child die during minority or in a
8. Children born of void marriages under Art. state of insanity. In these cases, the heirs
35, except where the marriage is void for shall have a period of five years within which
lack of authority on the part of the to institute the action.
solemnizing officer, but the parties or either
of them believed in good faith that the BAR QUESTION (2012)
solemnizing officer had authority, in which An illegitimate child may use the surname
case the marriage will be considered valid of his father when his filiation is
and the children will be considered established in any of the following
legitimate. instances, except:
BAR QUESTION (2012) a) Filiation has been recognized by the father
through the record of birth appearing in the
Who are illegitimate children? civil register
a) Children conceived or born outside a valid b) Admission of filiation by the father in a
marriage. public document.
b) Children born under a valid marriage, which c) Private handwritten instrument is made by
was later declared void because of the the father acknowledging his filiation.
psychological incapacity of either or both of d) Affidavit by the mother stating the name of
the spouses. his true father.
c) Children conceived and born outside a valid
marriage. SUGGESTED ANSWER
d) Children born under a valid marriage, but d) Affidavit by the mother stating the name of
the parents later obtained a legal his true father.
separation.
c) Rights of Illegitimate Children
SUGGESTED ANSWER
1. Use the surname and shall be under the
c) Children conceived and born outside a valid parental authority of their mother;
marriage. 2. Entitled to support in conformity with this
Code.
b) Proof of Filiation of Illegitimate Children 3. The legitime of each illegitimate child shall
Art. 175. Illegitimate children may establish their consist of one-half of the legitime of a
illegitimate filiation in the same way and on the legitimate child. (Art. 176 FC)
same evidence as legitimate children.
The action must be brought within the same RA 9255 amended Art 176
period specified in Article 173, except when the This act provides that illegitimate children
action is based on the second paragraph of may optionally use the father’s surname
Article 172, in which case the action may be provided that Filiation has been recognized
brought during the lifetime of the alleged parent. by the father through :
a. Record of birth appearing in the civil
PRIMARY PROOFS
register;
(1) The record of birth appearing in the civil
b. Admission in public document; OR
register or a final judgment; or
(2) An admission of legitimate filiation in a public c. Private handwritten instrument is made by
document or a private handwritten the father.
instrument and signed by the parent
concerned. d) Grounds to Impugn Filiation
• The father has the right to institute an
SECONDARY PROOFS action before the regular courts to prove
(1) The open and continuous possession of the non-filiation during his lifetime.
status of a legitimate child; or • See grounds in impugning legitimacy in
(2) Any other means allowed by the Rules of Article 166 by analogy, whenever
Court and special laws. (FC, Art. 172) applicable
4. LEGITIMATED CHILDREN ORDOÑA VS. THE LOCAL CIVIL REGISTRAR

Children conceived and born outside of OF PASIG CITY | G.R. No. 215370, November
wedlock of parents without impediment to 09, 2021
marry at the time of conception or were so EN BANC
disqualified only because either or both of • Richelle Busque Ordoña (petitioner) was
them were below 18 years of age (FC, Art. married to a certain Ariel O. Libut (Ariel) on
177, RA 9858) October 10, 2000 in Las Piñas City.
• In December 2005, petitioner went to Qatar
a) Who may be legitimated? for work until 2008 when she discovered that
Ariel had an illicit relationship. This prompted
Only children conceived and born outside of
her to return to the Philippines and separate
wedlock of parents who, at the time of the
from him.
conception of the former, were not disqualified
• Despite their eventual separation, petitioner
by any impediment to marry each other or has not yet filed a petition for annulment of
were so disqualified only because either or her marriage to Ariel.
both of them were below 18 may be • Thereafter, in April 2008, petitioner applied for
legitimated. (Art. 177 amended by RA 9858) another work in Abu Dhabi, United Arab
Emirates (UAE) where she met Allan D.
b) How Legitimation Takes Place Fulgueras (Allan), her former colleague in
• Art. 178. Legitimation shall take place by a Qatar.
subsequent valid marriage between • She and Allan engaged in an intimate
parents. The annulment of a voidable relationship which resulted in petitioner's
marriage shall not affect the legitimation. pregnancy with Allan as the purported father.
• Art. 179. Legitimated children shall enjoy Thus, petitioner went back to the Philippines
the same rights as legitimate children. sometime in September 2009. On January
• Art. 180. The effects of legitimation shall 26, 2010, petitioner gave birth to a son in a
retroact to the time of the child’s birth. hospital in Pasig City. In the Certificate of Live
• Art. 181. The legitimation of children who Birth, the child was given the name "Alrich
died before the celebration of the marriage Paul Ordoña Fulgueras” with "Allan Demen
shall benefit their descendants. Fulgueras" as the purported father.
• In September 2011, petitioner filed before the
c) Grounds to Impugn Legitimacy RTC the Rule 108 petition seeking the
following corrections: (1) change of last name
Art. 182. Legitimation may be impugned only
of Alrich Paul in Item No. 1 from "Fulgueras"
by those who are prejudiced in their rights,
to "Ordoña," petitioner's maiden name; and
within five years from the time their cause of
(2) deletion of entries in the paternal
action accrues. information as provided in Item Nos. 13 to 17.
• In addition to absence of requisites of She alleged that it was not Allan who signed
legitimation, apply by analogy the grounds the Affidavit of Acknowledgment/Admission of
in impugning legitimacy in Article 166, Paternity attached to the Certificate of Live
whenever applicable. Birth (Affidavit of Acknowledgment)
considering that Allan was not in the
BAR QUESTION (2009)
Philippines when she gave birth to Alrich
TRUE or FALSE. Answer TRUE if the Paul.
statement is true, or FALSE if the • Article 164 of the Family Code provides that
statement "children conceived or born during the
is false. Explain your answer in not more marriage of the parties are legitimate." Here,
petitioner admitted to being in a valid and
than two (2) sentences. (5%)
subsisting marriage with Ariel when she
xxx
conceived and gave birth to Alrich Paul. Thus,
[e] A dead child can be legitimated. Alrich Paul is presumed to be a legitimate
SUGGESTED ANSWER child of petitioner and Ariel. However, looking
at the Rule 108 petition in this case,
TRUE. To be legitimated, the law does not petitioner, mother of Alrich Paul, in effect
require a child to be alive at the time of the declared against her child's legitimacy when
marriage of his/her parents (Article 177, she alleged that Alrich Paul was the child of
FC). Furthermore, Art. 181 of the Family Allan.
Code which states that “[Th]e legitimation • Following the pronouncement in Miller,
of children who died before the celebration petitioner's collateral attack of Alrich Paul's
filiation cannot be allowed in a Rule 108
of marriage will benefit their descendants,”
proceeding. Thus, on this ground alone, the
does not preclude instances where such RTC should have dismissed the Rule 108
legitimation will benefit no one but the petition.
child’s ascendants, or other relatives.
• Further, assuming arguendo that the Rule • Given the foregoing, the Court must ultimately
108 petition filed in the case is considered as dismiss the Rule 108 petition filed by petitioner
the direct action to impugn Alrich Paul's and need not discuss the sufficiency of her
presumed legitimacy, the Rule 108 petition evidence to justify the corrections sought in
must still fail. It must be emphasized that the Alrich Paul's birth certificate.
direct action to impugn the legitimacy of a • As a result, there is now an absurd and
child must be brought by the proper parties unremedied situation that Alrich Paul remains
and within the period limited by law. to be illegitimate in the birth certificate and will
• Here, as correctly opined by Associate use the surname of Allan while possessing, at
Justice Estela M. Perlas-Bernabe, petitioner the same time, a legitimate status, one that is
is barred from impugning Alrich Paul's conferred on him by law.
presumed legitimacy considering the • Giving clarity to Alrich Paul's situation is
prohibition under Article 167 of the Family attended by a scarcity of remedies.
Code. Article 167 provides that "[t]he child • First, the mother who was in a valid and
shall be considered legitimate although the subsisting marriage at the time of conception
or giving birth to her child is prohibited under
mother may have declared against its
Article 167 of the Family Code from impugning
legitimacy or may have been sentenced as
the legitimacy of her child. The proscription
an adulteress.”
remains even if the mother is an estranged
• To elucidate, the presumption of legitimacy
wife.
under Article 164 of the Family Code is not
• Second, the child who was conceived or born
conclusive. It may be disputed based on the during a valid and existing marriage has no
grounds and manner provided under Articles right to impugn his own legitimacy under the
166, 170, and 171 of the same law. Family Code. He cannot choose his own
• In Concepcion v. Court of Appeals, the Court filiation.
ruled that the presumption of legitimacy is • Third, it is only the father, or in exceptional
"quasi-conclusive" and may be rebutted or circumstances, his heirs, who may impugn the
overthrown. The Court ruled: child's legitimacy on grounds provided under
• The presumption of legitimacy proceeds from Article 166 of the Family Code within the
the sexual union in marriage, particularly periods provided under Article 170 in relation
during the period of conception. To overthrow to Article 171 of the Family Code. Upon the
this presumption on the basis of Article 166 expiration of the periods, the status conferred
(1)(b) of the Family Code, it must be shown by the presumption becomes fixed and can no
beyond reasonable doubt that there was no longer be questioned.
access that could have enabled the husband • The hands of the Court are tied as it may only
to father the child. Sexual intercourse is to be entertain the impugnation of a child's
presumed where personal access is not presumed legitimacy in a direct action filed by
disproved, unless such presumption is the proper party and within the prescribed
rebutted by evidence to the contrary. period under the law.
• The presumption is quasi-conclusive and • In light of these, the Court finds the present
may be refuted only by the evidence of case as an opportune moment to highlight the
physical impossibility of coitus between absence of a remedy in favor of a mother in
husband and wife within the first 120 days of establishing the true filiation of her child.
the 300 days which immediately preceded Ultimately, the Court's observations are
the birth of the child. directed to the Legislature inasmuch as the
• To rebut the presumption, the separation Court is careful not to tread on the realm of
between the spouses must be such as to judicial legislation.
make marital intimacy impossible. This may • Here, petitioner maintained that Ariel, her
take place, for instance, when they reside in husband, could not have been Alrich Paul's
different countries or provinces and they father considering that upon learning of the
were never together during the period of latter's illicit relationship, she separated from
conception. Or, the husband was in prison him and went to Abu Dhabi, UAE to work
sometime in April 2008, stayed there, and
during the period of conception, unless it
engaged in an intimate relationship with Allan.
appears that sexual union took place through
Thereafter, she became pregnant, went back
the violation of prison regulations.
to the Philippines sometime in September
• Still, the rule is that the mother is barred from
2009, and gave birth to Alrich Paul on January
impugning or declaring against the legitimacy
26, 2010.
of her child, and only the father, or in • However, there is no remedy under the law
exceptional instances, his heirs, can contest available to petitioner to dispute the
in an appropriate action the legitimacy of a presumption of legitimacy accorded to Alrich
child born to his wife based on any of the Paul—not in a Rule 108 petition which must be
grounds enumerated under Article 166 of the dismissed primarily for being a collateral attack
Family Code. and not in any other action by reason of her
being the mother of Alrich Paul.
BAR QUESTION (2010) BAR QUESTION (2010)

In 1997, B and G started living together (B). If B acquiesces to the use of his
without the benefit of marriage. The surname by G's daughter by another
relationship produced one offspring, Venus. man, what is/are the consequence/s?
The couple acquired a residential lot in Explain.
Parañaque. After four (4) years or in 2001,
G having completed her 4-year college SUGGESTED ANSWER
degree as a fulltime student, she and B (B) If B acquiesces and does not file the
contracted marriage without a license. The action to impugn the legitimacy of the child
marriage of B and G was, two years later, within the prescriptive period for doing so in
declared null and void due to the absence Article 170 of the Family Code, G's
of a marriage license. Is Venus legitimate, daughter by another man shall be
illegitimate, or legitimated? Explain briefly. conclusively presumed as the legitimate
SUGGESTED ANSWER daughter of B by G.
Venus is illegitimate. She was conceived BAR QUESTION

and born outside a valid marriage. Thus,
she is considered illegitimate (Art 165, X and Y are living together as husband and
Family Code). The subsequent marriage of wife without the benefit of a marriage. They
her parents did not result in legitimation begot a child Z who married A. Z and A has
a child named B. In 1989, Z died. In 1990,
because said marriage was later on
X and Y got married. In 1991, a son named
declared null and void due to absence of a
ZZ of X and Y was born. When X and Y
marriage license. Under Article 178 of the
died intestate, ZZ executed an Extrajudicial
Family Code, "legitimation shall take place
Settlement of Estate adjudicating to himself
by a subsequent valid marriage between
as the sole heir of X and Y. Is ZZ correct?
parents. The annulment of a voidable
marriage shall not affect the legitimation." SUGGESTED ANSWER
The Article's application is limited to
voidable marriages. It follows that when the No. Art. 181 of the Family Code provides,
subsequent marriage is null or void, the "The legitimation of children who died
legitimation must also be null and void. before the celebration of the marriage shall
benefit their descendants." In the instant
case, Z died before the marriage of X and
BAR QUESTION (2010) Y. The resulting Z's legitimation shall
Spouses B and G begot two offsprings. benefit B, his descendant. Thus, B can
Albeit they had serious personality represent his father Z in the inheritance of
differences, the spouses continued to live his grandparents. Since a legitimated child
under one roof. B begot a son by another has the same right as a legitimate child, B
woman. G also begot a daughter by has now the right to inherit by right of
another man. representation to ½ of the estate while the
(A). If G gives the surname of B to her other ½ of the estate will be ZZ's
daughter by another man, what can B inheritance.
do to protect their legitimate children's
interests? Explain. BAR QUESTION (2008)
SUGGESTED ANSWER Roderick and Faye were high school

sweethearts. When Roderick was 18 and Faye,
(A) B can impugn the status of G's 16 years old, they started to live together as
daughter by another man as his legitimate husband and wife without the benefit of
daughter on the ground that for biological marriage. When Faye reached 18 years of age,
reason he could not have been the father of her parents forcibly took her back and arranged
the child, a fact that may be proven by the for her marriage to Brad. Although Faye lived
with Brad after the marriage, Roderick
DNA test. Having been born during the
continued to regularly visit Faye while Brad
marriage between B and G, G's daughter
was away at work. During their marriage, Faye
by another man is presumed as the child of gave birth to a baby girl, Laica. When Faye was
B under Article 164 of the Family Code. In 25 years old, Brad discovered her continued
the same action to impugn, B can pray for liason with Roderick and in one of their heated
the correction of the status of the said arguments, Faye shot Brad to death.
daughter in her record of birth.
CONT. SUGGESTED ANSWER

She lost no time in marrying her true love No. Gianna cannot be legitimated by the
Roderick, without a marriage license, claiming subsequent marriage of Andy and Aimee.
that they have been continuously cohabiting for Art. 177 of the FC provides that "only
more than 5 years.
children conceived and born outside of
(A) What is the filiation status of Laica?
wedlock of parents who, at the time of the
(B) Can Laica bring an action to impugn her
own status on the ground that based on conception of the former, were not
DNA results, Roderick is her biological disqualified by any impediment to marry
father? each other may be legitimated." In the
(C) Can Laica be legitimated by the present case, a legal impediment was
marriage of her biological parents? existing at the time of the conception of
Gianna. Her mother, Aimee, was still in the
SUGGESTED ANSWER
process of securing judicial declaration of
(A) Laica is legitimate because children nullity of her marriage to her ex-husband.
conceived or born during the marriage of the
parents are presumed to be legitimate (Art. BAR QUESTION (2009)
164, FC). Laica is presumed the legitimate
child of Brad and Faye. Four children, namely: Alberto, Baldomero,
Caridad, and Dioscoro, were born to the
(B) No. Laica cannot bring an action to impugn spouses Conrado and Clarita de la Costa. The
her own status. In a case decided by the children’s birth certificates were duly signed
Supreme Court it was ruled that impugning the by Conrado, showing them to be the couple’s
legitimacy of the child is a strictly personal right legitimate children. Later, one Edilberto de la
of husband, except: (a) when the husband died Cruz executed a notarial document
before the expiration of the period fixed for acknowledging Alberto and Baldomero as his
bringing the action; (b) if he should die after the illegitimate children with Clarita. Edilberto died
filing of the complaint, without having desisted leaving substantial properties. In the
therefrom, or (c) if the child was born after the settlement of his estate, Alberto and
death of the husband. Laica's case does not Baldomero intervened claiming shares as the
fall under any of the exceptions. (Liyao Jr. v. deceased’s illegitimate children. The
Tanhoti-Liyao, G.R. No. 138961, 07 March legitimate family of Edilberto opposed the
2002) claim. Are Alberto and Baldomero entitled
to share in the estate of Edilberto? Explain.
(C) No. Laica cannot be legitimated by the
marriage of her biological parents because only SUGGESTED ANSWER
children conceived and born outside of wedlock No, Alberto and Baldomero are not entitled to
of parents who at the time of the conception of share in Edilberto’s estate. They are not
the former were not disqualified by any
related at all to Edilberto. They were born
impediment to marry each other may be
during the marriage of Conrado and Clarita,
legitimated (Art. 177, FC). In this case, there is
hence, are considered legitimate children of
an impediment and that is, Faye is married to
the said spouses. This status is conferred on
Brad at the time of the conception of Laica
them at birth by law. Under Philippine law, a
person cannot have more than one natural
BAR QUESTION (2008) filiation. The legitimate filiation of a person can
be changed only if the legitimate father will
Gianna was born to Andy and Aimee, who
successfully impugn such status. In the
at the time Gianna's birth were not married
problem, therefore, the filiation of Alberto and
to each other. While Andy was single at the Baldomero as the legitimate children of
time, Aimee was still in the process of Conrado cannot be changed by their
securing a judicial declaration of nullity on recognition by Edilberto as his illegitimate
her marriage to her ex-husband. Gianna's children. Before they can be conferred the
birth certificate, which was signed by both status of Edilberto’s illegitimate children,
Andy and Aimee, registered the status of Conrado must first impugn their legitimacy.
Gianna as "legitimate", her surname Since Conrado has not initiated any action to
carrying that of Andy's and that her parents impugn their legitimacy, they continue to be
were married to each other. Assuming that the legitimate children of Conrado. They
Aimee is successful in declaring her former cannot be the illegitimate children of Edilberto
marriage void, and Andy and Aimee at the same time. Not being the illegitimate
subsequently married each other, would children of Edilberto, they have no right to
Gianna be legitimated? inherit from him.
5. ADOPTED CHILDREN • The NACC shall also have the power to

impose penalties in case of any violation of RA
a) Domestic Administrative Adoption and 11642. (Section 6, RA 11642)
Alternative Child Care Act (RA 11642)
AN ACT STRENGTHENING ALTERNATIVE RA 11642 repealed/ amended the following:
CHILD CARE BY PROVIDING FOR AN  Repealed RA 8552 “Domestic Adoption Act”
ADMINISTRATIVE PROCESS OF DOMESTIC  Repealed RA 9523 “Act requiring DSWD
ADOPTION, REORGANIZING FOR THE certification to declare a child legally available
PURPOSE THE INTER-COUNTRY ADOPTION for adoption”
BOARD (ICAB) INTO THE NATIONAL  Amended RA 8043 “Inter-country Adoption
AUTHORITY FOR CHILD CARE (NACC), Act”
AMENDING FOR THE PURPOSE REPUBLIC  Amended RA 11222 “Rectification of
ACT NO. 8043, REPUBLIC ACT NO. 11222, Simulated Birth Act”
AND REPUBLIC ACT NO. 10165, REPEALING  Amended RA 10165 “Foster Care Act of 2012”
REPUBLIC ACT NO. 8552, AND REPUBLIC
ACT NO. 9523, AND APPROPRIATING FUNDS Adoption’ defined
THEREFOR. • Refers to the socio-legal process of providing
• Also known as the Domestic Administrative a permanent facility to a child whose parents
Adoption and Alternative Child Care Act, was had voluntarily given up their parental rights,
signed by Duterte on Jan. 6, 2022 permanently transferring all rights and
• RA 11642 removes the judicial process for responsibilities, along with filiation, making the
adoption, as this would now be handled child a legitimate child of the adoptive parents;
administratively by the National Authority for Provided, That adult adoption shall also be
Child Care (NACC). covered by benefits of this Act.
• The Inter-Country Adoption Board (ICAB) will • In the interest of clarity, adoption shall cease
be re-organized to a one-stop quasi-judicial to be part of alternative child care and
agency on alternative child care known as the becomes parental care as soon as the
National Authority for Child Care (NACC), process is completed.
attached to the Department of Social Welfare
and Development (DSWD). ‘Domestic Adoption’ defined
• The NACC will exercise all powers and Refers to an administrative adoption proceeding
functions relating to alternative child care, where the Order of Adoption is issued within the
including declaring a child legally available for Philippines and is undertaken between a Filipino
domestic administrative and intercountry child and eligible adoptive parents.
adoption, foster care, kinship care, family-like
‘Intercountry Adoption’ defined
care, or residential care.
Refers to the socio-legal process of adopting a
• "All duties, functions, and responsibilities of
child by a foreign national or a Filipino citizen
the ICAB, the DSWD, and those of other
habitually a resident outside Philippine territory
government agencies relating to alternative
which complies with the principles in the Hague
child care and adoption are hereby
Convention of 1993
transferred to the NACC,"
• "The best interest of the child shall be the
paramount consideration in the enactment of
alternative care, custody, and adoption b) Who may Adopt
policies” 1. Any Filipino citizen at least 25 years of age,
• Under RA 11642, The NACC is tasked to who is in possession of full civil capacity and
legal rights; has not been convicted of any
ensure that petitions and other matters
crime involving moral turpitude; is of good
involving alternative child care are “simple,
moral character and can model the same; is
expeditious and inexpensive, and will
emotionally and psychologically capable of
redound to the best interest of the child
caring for the children; at least 16 years older
involved.”
than the adoptee; and who is in a position to
support and care for the adopted children in
Jurisdiction of NACC
keeping with the means of the family;
• The NACC shall have the original and
Provided, That the requirement of 16-year
exclusive jurisdiction over all matters
difference between the age of the adopted
pertaining to alternative child care, including
and the adoptee may be waived when the
declaring a child legally available for
adopter is the biological parent of the
adoption; domestic administrative adoption;
adoptee, or is the spouse of the adoptee’s
adult adoption; foster care under RA No.
parent;
10165 (Foster Care Act of 2012); adoptions
2. The legal guardians with respect to their ward
under RA 11222 (Simulated Birth
after the termination of the guardianship and
Rectification Act); and, inter-country adoption
clearance of financial accountabilities;
under RA 8043 (Inter-country Adoption Act).
3. The foster parent with respect to the foster SUGGESTED ANSWER

child;
4. Philippine government officials and I will dismiss the petition for adoption. The
employees deployed or stationed abroad; rule is that the husband and wife must
Provided, That they are able to bring the jointly adopt and there are only three
child with them; and, recognized exceptions to joint adoption by
5. Foreign nationals who are permanent or the husband and wife: 1) if one spouse
habitual residents of the Philippines for at seeks to adopt the legitimate child of the
least 5 years possessing the same other; 2) if one spouse seeks to adopt his
qualifications as above stated for Filipino or her own illegitimate child; 3) if the
nationals prior to the filing of the petition.
spouses are legally separated.
Provided, That they come from a country
with diplomatic relations with the Republic of
the Philippines and that the laws of the The case of Maria and Daniel does not
adopter’s country will acknowledge the appear to fall under any of the recognized
Certificate of Adoption as valid, acknowledge exceptions, accordingly the petition filed by
the child as a legal child of the adopters, and the wife alone should be dismissed.
allow entry of the child into such country as
an adoptee; c) Who may be Adopted
Provided further, that the requirements of 5-year Section 22, RA 11642
residency may be waived for the following: 1. Any child who has been issued a
a. A former Filipino citizen, habitually residing Certificate Declaring the Child Legally
in the Philippines, who seeks to adopt a Available for Adoption (CDCLAA)
relative within the 4th civil degree of 2. The legitimate child one spouse by the
consanguinity or affinity;
other spouse;
b. One who seeks to adopt the legitimate child
3. An illegitimate child by a qualified adopter
of the Filipino spouse;
to improve status of legitimacy;
c. One who is married to a Filipino and seeks
4. A Filipino of legal age if, prior to the
to adopt jointly with the spouse a relative
within the 4th degree of consanguinity or
adoption, said person has been
affinity of the Filipino spouse; consistently considered and treated by the
adopters as their own child for a period of
Joint Adoption by Spouses at least three (3) years;
General Rule: Spouses shall jointly adopt 5. A foster child;
Exceptions: 6. A child whose adoption has been
a. If one spouse seeks to adopt the legitimate previously rescinded;
child of the other; or 7. A child whose biological or adoptive
b. If one spouse seeks to adopt own illegitimate parents have died. Provided, no
child; Provided, That the other spouse has proceedings shall be initiated within 6
signified consent thereto; or months from death of parents;
c. If the spouses are legally separated from 8. A relative of the adopter.
each other.
Consent Necessary to the Adoption
BAR QUESTION (2014) 1. The adoptee, if 10 years of age or over
2. The biological parents of the child, if
Spouses Esteban and Maria decided to known, or the legal guardian or the proper
raise their two (2) nieces, Faith and Hope, government instrumentality which has legal
both minors, as their own children after the custody of the child, except in case of a
parents of the minors died in a vehicular Filipino of legal age if, prior to the adoption,
accident. Ten (10) years after, Esteban said person has been consistently
died. Maria later on married her boss considered and treated as their own child
Daniel, a British national who had been by the adopter for at least 3 years.
living in the Philippines for two (2) years. 3. The legitimate or adopted children, 10
With the permission of Daniel, Maria filed a years of age or over of the adopters, if any;
petition for the adoption of Faith and Hope. 4. The illegitimate children, 10 years of age or
She did not include Daniel as her co- over, of the adopter if living with said
petitioner because for Maria, it was her adopter or over whom the adopter
former husband Esteban who raised the exercises parental authority and the latter’s
spouse, if any; and,
kids. If you are the judge, how will you
5. The spouse, if any, of the person adopting
resolve the petition?
or to be adopted. (Section 23)
BAR QUESTION (2010) Articles 189 -190 of the Family Code

(note: these effects of adoption under the
Spouses Rex and Lea bore two children now
Family Code are impliedly repealed by the
aged 14 and 8. During the subsistence
RA 11642 in so far as inconsistent with the
of their marriage, Rex begot a child by another
latter)
woman. He is now 10 years of age.
On Lea’s discovery of Rex’s fathering a child by
Art. 189. Adoption shall have the following
another woman, she filed a petition for legal
effects:
separation which was granted. Rex now wants
(1) For civil purposes, the adopted shall be
to adopt his illegitimate child. Whose consent
deemed to be a legitimate child of the
is needed for Rex’s adoption of his
adopters and both shall acquire the
illegitimate child?
reciprocal rights and obligations arising from
SUGGESTED ANSWER the relationship of parent and child, including
the right of the adopted to use the surname
The consent of the 14-year-old legitimate child, of the adopters;
of the 10-year-old illegitimate child, and of the (2) The parental authority of the parents by
biological mother of the illegitimate child are nature over the adopted shall terminate and
needed for the adoption. The consent of Lea is be vested in the adopters, except that if the
no longer required because there was already adopter is the spouse of the parent by nature
a final decree of legal separation. of the adopted, parental authority over the
adopted shall be exercised jointly by both
d) Effects of a Decree of Adoption spouses; and
1. Legitimacy (3) The adopted shall remain an intestate heir of
the adoptee shall be considered legitimate child his parents and other blood relatives.
of the adopter for all intents and purpose s and
such is entitled to all the rights and obligations Art. 190. Legal or intestate succession to the
provided by law to legitimate children born to estate of the adopted shall be governed by the
them without discrimination of any kind. To this following rules:
end, the adoptee is entitled to love, guidance, (1) Legitimate and illegitimate children and
and support in keeping with the means of the descendants and the surviving spouse of the
family. adopted shall inherit from the adopted, in
 The legitimate filiation that is created between accordance with the ordinary rules of legal or
the adopter and adoptee shall be extended to intestate succession;
the adopter’s parents, adopter’s legitimate (2) When the parents, legitimate or illegitimate,
siblings, and legitimate descendants. or the legitimate ascendants of the adopted
 The adopter is also given the right to choose concur with the adopter, they shall divide the
the name by which the child is to be known, entire estate, one-half to be inherited by the
consistent with the best interest of the child. parents or ascendants and the other half, by
(Section 41) the adopters;
(3) When the surviving spouse or the illegitimate
2. Parental Authority children of the adopted concur with the
upon the issuance of the Order of Adoption, adopters, they shall divide the entire estate
adoption shall cease as an alternative care and in equal shares, one-half to be inherited by
becomes parental care. Adoptive parents shall the spouse or the illegitimate children of the
now have full parental authority over the child. adopted and the other half, by the adopters.
Except in cases where the biological parent is (4) When the adopters concur with the
the spouse of the adopter, all legal ties between illegitimate children and the surviving spouse
the biological parents and the adoptee shall be of the adopted, they shall divide the entire
severed and the same shall then be vested on estate in equal shares, one-third to be
the adopters. inherited by the illegitimate children, one-
 In case spouses adopt jointly, or one spouse third by the surviving spouse, and one-third
adopts the legitimate child of the other, joint by the adopters;
parental authority shall be exercised by the (5) When only the adopters survive, they shall
spouse. (Section 42) inherit the entire estate; and
(6) When only collateral blood relatives of the
3. Succession adopted survive, then the ordinary rules of
 In testate and intestate succession, the legal or intestate succession shall apply.
adopters and the adoptee shall have
reciprocal rights of succession without Order of Adoption
distinction from legitimate filiations. However,  The Order of Adoption issued by the NACC
if the adoptees and their biological parents shall have the same effect as a Decree of
have left a will, the law on testamentary Adoption issued under the Domestic Adoption
succession shall govern. (Section 43) Act of 1998.
 A motion for reconsideration may be filed 3. SOURCE OF SUPPORT

within 15 calendar days from an order denying
the petition to NACC, through the Executive 1. ACP/CPG
Director. spouses and children. After nullity, annulment,
 Judicial Recourse – Order of Adoption may legal separation, separate properties of the
be appealed to the Court of Appeals within 10 parties.
calendar days from receipt, of from the denial
of motion for reconsideration. Rule 43 of the 2. Separate Property
Rules of Court shall apply suppletorily. ascendant, descendants, brothers and sisters.
Subsidiary ACP/CPG, but shall be deducted
Rescission from the share of the spouse.
Adoption may be rescinded only upon petition of
the adoptee with the NACC on any of the 3. Regime of Separation of property
following grounds: both spouses shall bear the family expenses in
• Repeated physical or verbal maltreatment by proportion to their income, in case of
the adopter despite having undergone insufficiency or default, the current market value
counseling; of the exclusive property.
• Sexual abuse or violence;
• Abandonment and failure to comply with
4. Order of Support
parental obligations
• Adoption being for the best interest of the
Order of liability to give support
child, shall not be subject to rescission by the
Whenever two or more persons are obliged to
adopter. The adopter may disinherit the
give support, the liability shall devolve in the
adoptee for cause under Art 919 of the Civil
following persons in the order herein provided:
Code.
a. Spouse;
L. SUPPORT b. Descendants in the nearest degree;
c. Ascendants in the nearest degree;
Support’ defined d. Brothers and sisters. (Art. 199, FC)
everything indispensable for the sustenance, When the obligation falls upon two or more
dwelling, clothing, medical attendance, persons, the payment shall be divided between
education and transportation, in keeping with the them in proportion to the resources of each.
financial capacity of the family. (Article 194 FC)
Order of Preference
1. WHAT COMPRISES SUPPORT When two or more recipients at the same time
• It comprises everything indispensable for claim support from one and the same person
sustenance, dwelling, clothing, medical legally obliged to give it, should the latter not
attendance, education and transportation, in have sufficient means to satisfy all claims, the
keeping with the financial capacity of the family order established in the preceding article shall
including the education of the person entitled be followed, unless the concurrent obligees
to be supported until he completes his should be the spouse and a child subject to
education or training for some profession, parental authority, in which case the child shall
trade or vocation, even beyond the age of be preferred. (Art. 200, FC)
majority.
• Transportation – includes expenses going to BAR QUESTION (2011)
and from school, or to from place of work.
(Article 194, FC). (2010 BAR) Illegitimate brothers and sisters, whether of full
or half-blood, are bound to support
2. WHO ARE OBLIGED TO GIVE SUPPORT each other, EXCEPT when:
(1) The spouses; (A) the brother or sister who needs support
(2) Legitimate ascendants and descendants; lives in another place.
(3) Parents and their legitimate children and the (B) such brothers and sisters are not
legitimate and illegitimate children of the recognized by their father.
latter; (C) the brother or sister in need stops schooling
(4) Parents and their illegitimate children and without valid reason.
the legitimate and illegitimate children of the (D) the need for support of a brother or sister,
latter; already of age, is due to the latter's fault.
(5) Legitimate brothers and sisters, whether of SUGGESTED ANSWER
full or half-blood; and
(6) Brothers and sisters not legitimately related, (D) the need for support of a brother or sister,
whether of the full or half-blood, except only already of age, is due to the latter's fault.
when the need for support of the brother or
sister, being of age, is due to a cause
imputable to the claimant’s fault or
M. PARENTAL AUTHORITY
negligence.
1. CONCEPT OF PARENTAL AUTHORITY Whenever the appointment of a judicial

‘Parental Authority’ defined guardian over the property of the child
• It is the natural right and duty of parents over becomes necessary, the same order of
the person and property of their unemancipated preference shall be observed.
children, parental authority and responsibility
shall include the caring for and rearing them for Foundlings, abandoned, neglected or
civic consciousness and efficiency and the abused children
development of their moral, mental and physical In case of foundlings, abandoned, neglected or
character and well-being (Article 209, FC).
abused children and other children similarly
• Parental authority and responsibility may not be
situated, parental authority shall be entrusted in
renounced or transferred except in the cases
authorized by law. (Article 210, FC).
summary judicial proceedings to heads of
children's homes, orphanages and similar
Joint Exercise of Parental Authority institutions duly accredited by the proper
• Father and mother shall jointly exercise government agency. (Article 217, FC)
parental authority
• In case of disagreement: 3. SPECIAL PARENTAL AUTHORITY
• General Rule: Father’s decision prevails  The school, its administrators and teachers,
• XPN: unless there is a judicial order to the or the individual, entity or institution engaged
contrary (Article 211, FC) in child care shall have special parental
• Absence/death of either parent – authority and responsibility over the minor
present/surviving parent shall exercise child while under their supervision,
parental authority. Remarriage will not affect instruction or custody.
parental authority unless the court appoints  Authority and responsibility shall apply to all
another person to be the guardian of the authorized activities whether inside or
person or property of the children. (Article 212, outside the premises of the school, entity or
FC) institution.
 The parents, judicial guardians or the
Separation of Parents persons exercising substitute parental
• Parent designated by the court authority over said minor shall be subsidiarily
• “Tender age presumption” - If child under 7 liable.
years old, the mother shall exercise parental  Defense: exercised the proper diligence
authority unless there is compelling reason to
required under the particular circumstances.
separate child from the mother
(Articles 218 and 219, FC)
• Maternal preference rule – based on
 Articles 218 and 219 refer to minor.
universally recognized rule that the mother is
the natural custodian of her young.
• Child over 7, consider child’s choice, unless Art. 2180. Teacher or heads of establishments
the parent chosen is unfit. of arts and trades shall be liable for damages
• Only the exercise of parental authority is given caused by their pupils and students or
when custody is awarded; other spouse still apprentices so long as they remain in their
retains parental authority, which may be custody.
exercised through visitorial rights.
4. EFFECTS OF PARENTAL AUTHORITY
Death, Absence, Unsuitability of Both Parents Rights and duties of parents/those with parental
Art. 214. In case of death, absence or authority:
unsuitability of the parents, substitute parental a. To keep them in their company, educate &
authority shall be exercised by the surviving provide for their upbringing
grandparent. b. To give them love, affection, advice,
• In case several survive, the one designated by companionship & understanding;
the court, taking into account the same c. Provide them with moral & spiritual
consideration mentioned in the preceding guidance;
article, shall exercise the authority d. To enhance, protect & preserve their
physical & mental health;
2. SUBSTITUTE PARENTAL AUTHORITY e. To furnish them with good educational
Art. 216. In default of parents or a judicially materials;
appointed guardian, the following person shall f. To represent them in all matters affecting
exercise substitute parental authority over the their interests;
child in the order indicated:
g. To demand from them respect and
(1) The surviving grandparent, as provided in Art.
obedience;
214;
h. To impose discipline on them as may be
(2) The oldest brother or sister, over twenty-one
required under circumstances;
years of age, unless unfit or disqualified; and
(3) The child's actual custodian, over twenty-one i. To perform such other duties as imposed by
years of age, unless unfit or disqualified. law upon parents & guardians.
Vicarious Liability or Doctrine of Imputed Art. 232. If the person exercising parental
Negligence authority has subjected the child or allowed him
 Parents and other persons exercising to be subjected to sexual abuse, such person
parental authority shall be civilly liable for shall be permanently deprived by the court of
the injuries and damages caused by acts or such authority.
omissions of their unemancipated children
living in their company and under their Art. 229. Unless subsequently revived by a final
parental authority subject to appropriate judgment, parental authority also terminates:
(1) Upon adoption of the child;
defenses provided by law.
(2) Upon appointment of a general guardian;
 Defense: show exercised the due diligence
(3) Upon judicial declaration of abandonment of
of a good father of a family.
the child in a case filed for the purpose;
 Liability is due to failure to supervise in (4) Upon final judgment of a competent court
order to prevent them from causing damage divesting the party concerned of parental
or injury. authority; or
(5) Upon judicial declaration of absence or
Effects of Parental Authority Upon the incapacity of the person exercising parental
property of the child authority.
Art. 225. The father and the mother shall
jointly exercise legal guardianship over the Suspension of Parental Authority
property of the unemancipated common child 1. Conviction of the parent or the person
without the necessity of a court appointment. exercising the same of a crime which carries
In case of disagreement, the father’s decision with it the penalty of civil interdiction. The
shall prevail, unless there is a judicial order to authority is automatically reinstated upon
the contrary. service of the penalty or upon pardon or
amnesty of the offender. (Art. 230, FC)
Where the market value of the property or the 2. The court in an action filed for the purpose in
annual income of the child exceeds P50,000, a related case may also suspend parental
the parent concerned shall be required to authority if the parent or the person
furnish a bond in such amount as the court exercising the same:
(a) Treats the child with excessive harshness
may determine, but not less than ten per
or cruelty;
centum (10%) of the value of the property or
(b) Gives the child corrupting orders, counsel
annual income, to guarantee the performance
or example;
of the obligations prescribed for general
(c) Compels the child to beg; or
guardians. (d) Subjects the child or allows him to be
subjected to acts of lasciviousness.
A verified petition for approval of the bond The grounds enumerated above are deemed to
shall be filed in the proper court of the place include cases which have resulted from culpable
where the child resides, or, if the child resides negligence of the parent or the person exercising
in a foreign country, in the proper court of the parental authority.
place where the property or any part thereof is
BAR QUESTION (2006)
situated.
Under Article 213 of the Family Code, no child
Art. 226. The property of the unemancipated under 7 years of age shall be separated
child earned or acquired with his work or from the mother unless the court finds
industry or by onerous or gratuitous title shall compelling reasons to order otherwise.
belong to the child in ownership and shall be (1) Explain the rationale of this provision.
devoted exclusively to the latter’s support and SUGGESTED ANSWER
education, unless the title or transfer provides
otherwise. (1)The rationale of the 2nd paragraph of Article
213 of the Family Code is to avoid the tragedy
The right of the parents over the fruits and of a mother who sees her baby torn away from
income of the child’s property shall be limited her. It is said that the maternal affection and
primarily to the child’s support and secondarily care during the early years of the child are
to the collective daily needs of the family. generally needed by the child more than
paternal care (Hontiveros v. IAC, G.R. No.
Termination of Parental Authority 64982, October 23, 1984; Tolentino,
Art. 228. Parental authority terminates Commentaries and Jurisprudence on the Civil
Code, Volume One, pp. 718-719). The general
permanently:
rule is that a child below 7 years old shall not
(1) Upon the death of the parents;
be separated from his mother due to his basic
(2) Upon the death of the child; or
need for her loving care (Espiritu v. C.A., G.R.
(3) Upon emancipation of the child
No. 115640, March 15,1995).
(CONT.) BAR QUESTION (2006) BAR QUESTION (2003)

(2) Give at least 3 examples of “compelling Distinguish briefly but clearly between:
reasons” which justify the taking away from Substitute parental authority and special
the mother’s custody of her child under 7 parental authority.
years of age.
SUGGESTED ANSWER
SUGGESTED ANSWER
In substitute parental authority, the parents
a. The mother is insane (Sempio-Diy, Hand lose their parental authority in favor of the
book on the Family Code of the Philippines, substitute who acquires it to the exclusion
pp. 296-297); of the parents. In special parental authority,
b. The mother is sick with a disease that is the parents or anyone exercising parental
communicable and might endanger the authority does not lose parental authority.
health and life of the child; Those who are charged with special
(c. The mother has been maltreating the parental authority exercise such authority
child; only during the time that the child is in their
d. The mother is a habitual drunkard or an custody or supervision. Substitute parental
alcoholic; authority displaces parental authority while
e. The mother is in jail or serving special parental authority concurs with
sentence.) parentsal authority. Substitute parental
authority may only be exercised in the
BAR QUESTION (2003) absence, death or incapacity of both
parents.
If during class hours, while the teacher
was chatting with other teachers in the
school corridor, a 7 year old male pupil
stabs the eye of another boy with a ball
pen during a fight, causing permanent
blindness to the victim, who could be
liable for damages for the boy’s injury: the
teacher, the school authorities, or the
guilty boy’s parents? Explain.
SUGGESTED ANSWER
The school, its administrators, and
teachers have special parental authority
and responsibility over the minor child
while under their supervision, instruction
or custody (Article 218, FC). They are
principally and solidarily liable for the
damages caused by the acts or omissions
of the unemancipated minor unless they
exercised the proper diligence required
under the circumstances (Article 219, FC).
In the problem, the teacher and the school
authorities are liable for the blindness of
the victim, because the student who
caused it was under their special parental
authority and they were negligent. They
were negligent because they were
chatting in the corridor during the class
period when the stabbing incident
occurred. The incident could have been
prevented had the teacher been inside the
classroom at that time. The guilty boy’s
parents are subsidiarily liable under Article
219 of the Family Code.
PROPERTY, OWNERSHIP, AND ITS

MODIFICATIONS
I. CLASSIFICATION OF PROPERTY
A. Immovables
B. Movables
PROPERTY A. IMMOVABLES
• All things which are or may be the object
of appropriation. (Art. 414,NCC) Categories of immovables under article
• It is an object or a right which is 415:
appropriated or susceptible of
appropriation by man, with capacity to 1. By Nature (1&8)
satisfy human wants and needs. Those that cannot be moved from place to
place.
PROPERTY vs. THING (1) Land, buildings, roads and constructions of
• Concept of THING is broader than the all kinds adhered to the soil;
concept of PROPERTY. (8) Mines, quarries, and slag dumps, while the
• PROPERTY refers only to those which matter thereof forms part of the bed, and
are or may be the object of appropriation. waters either running or stagnant;
• THING refers to all objects, including
2. By Incorporation (2, 3 & 7)
those which are not or may not be
Those which are attached to an immovable in
appropriated.
such a manner as to form an integral part
• THING is the genus while PROPERTY is
thereof.
the species. (2) Trees, plants, and growing fruits, while
• Civil Code uses the terms they are attached to the land or form an
interchangeably. integral part of an immovable;
(3) Everything attached to an immovable in a
What are the requisites for a thing to be fixed manner, in such a way that it cannot be
considered as a property? separated therefrom without breaking the
1. Utility – Capacity to satisfy human material or deterioration of the object;
wants. (7) Fertilizer actually used on a piece of land;
2. Substantivity / Individuality – It has a
separate and autonomous existence. It 3. By Destination (4, 5, 6, & 9)
can exist by itself and not merely as a Those which are placed in an immovable for
part of a whole. use, exploitation or perfection of such
3. Appropriability – Susceptibility to immovable.
ownership/possession, even if not yet (4) Statues, reliefs, paintings or other objects
actually appropriated. for use or ornamentation, placed in buildings
or on lands by the owner of the immovable in
BAR QUESTION such a manner that it reveals the intention to
attach them permanently to the tenements;
TRUE OR FALSE: (5) Machinery, receptacles, instruments or
All rights are considered as property implements intended by the owner of the
tenement for an industry or works which may
SUGGESTED ANSWER be carried on in a building or on a piece of
land, and which tend directly to meet the
FALSE - not all rights are considered needs of the said industry or works;
property. Strictly speaking, property is an (6) Animal houses, pigeon-houses, beehives,
economic concept which pertains to all fish ponds or breeding places of similar
things useful to human activity. There are nature, in case their owner has placed them or
however, rights belonging to an individual preserves them with the intention to have
which while protected by law, are not them permanently attached to the land, and
considered property like the right to life, forming a permanent part of it; the animals in
liberty and the pursuit of happiness. these places are included;
60
4. By Analogy (10)
QUESTION
Those which are considered immovables by
operation of law (contracts for public works and Anna and Hans entered into a contract of lease
servitudes and other real rights over immovable for the use of the lot owned by Hans. Anna
property) thereafter constructed a building on the property.
(10) Contracts for public works, and servitudes She placed inside the building machineries
and other real rights over immovable property. principally used for her wine business. In the
contract, Anna agreed to turn over to Hans all the
B. MOVABLES buildings and improvements upon the expiration
of the lease, except for the machineries. Are
Tests to determine whether a property is a machineries movable or immovable properties?
Explain.
movable property under art 416.
1. Test of Exclusion - It is everything that is SUGGESTED ANSWER
not included in Art. 415, The machineries are movables. They were not
2. By reason of a Special law - It is movable immobilized by destination because only the
for the purpose of the special Law lessee placed them into the building, and not by
the owner of the real property.
3. Test of Mobility - The property is capable
of being carried from place to place without QUESTION
injuring the real property to which it may in
Mark owns a painting. He wants to know if a
the meantime be attached
painting may be categorized as an immovable
1) Those movables susceptible of property under the Civil Code. Explain.
appropriation which are not included in
SUGGESTED ANSWER
the preceding article (Art 415);
2) Real property which by any special As a rule, a painting is movable because it can be
transported from one place to another without
provision of law is considered as
causing damage to the thing. Under the Civil Code,
personal property a painting can be immobilized by destination if it is
3) Forces of nature which are brought placed by the owner of the tenement in a building
under control by science with the intention of permanently attaching it thereto.
4) In general, all things which can be Q&A
transported from place to place without
BRIEFLY EXPLAIN IF THE FOLLOWING
impairment of the real property to which PROPERTIES ARE MOVABLES OR
they are fixed. IMMOVABLES:
1. Trees and plants attached to the soil
Important Doctrines: Answer: By express provision of law, trees and
plants adhered to soil are immovable property.
• A Building is an immovable even if not
erected by the owner of the land. The only 2. Vegetables in a hydroponics garden made
criterion is union or incorporation with the of plastic bottles filled with water.
soil. Answer: These are movables as they can be
• Parties to a contract may by agreement treat moved from one place to another.
as personal properties that which by nature
3. Steel pipe system used in transporting
would be real property; and it is a familiar petroleum products.
phenomenon to see things classified as real Answer: Based on jurisprudence, steel pipe
property for purposes of taxation which on system is considered immovable by
general principle might be considered incorporation, because they are attached to the
land in such a way that it cannot be separated
personal property. therefrom without dismantling the steel pipes
• The human body, whether alive or dead, is which were welded to form the pipeline.
neither real nor personal property, for it is not
even property at all, in that it generally cannot 4. Machineries used in a Bus terminal by a
Bus Company for maintenance of buses
be appropriated. Under certain conditions,
Answer: Movables, since they are not principally
the body of a person or parts thereof may be used for the industry carried out in a building or
subject matter of a transaction. (See RA No. on a piece of land.
349, RA No. 7170, RA No. 7719).
• A building that is to be sold or mortgaged and 5. Fertilizer for use on a piece of land.
Answer: Movables. They will become
which would be immediately demolished may
immovables if already placed on the soil.
be considered personal property, for the true
object of the contract would be the materials.
II. BUNDLE OF RIGHTS

A. Ownership D. Co-Ownership
B. Rights of Accession E. Possession
C. Actions to Recover Ownership F. Usufruct
and Possession of Property G. Easements
A. OWNERSHIP Limitations upon the Right of Ownership

1. General limitation imposed by the State
Kinds of Ownership in the exercise of its inherent powers –
1. Full ownership. This includes all the rights Police power, Taxation, Eminent domain
of an owner; Naked ownership + Usufruct 2. Limitations imposed by specific
3. Naked ownership. It is where the rights to provisions of the law - legal easement,
the use and to the fruits have been denied; zoning regulations, building code, rent
Full ownership – Usufruct control, urban and agrarian reform,
4. Sole ownership. It is where the ownership subdivision regulations, escheat.
is vested in only one person; 3. Limitations imposed by the transferor of
5. Co-ownership. It is where the ownership is the property – donation, usufruct, no
vested in 2 or more persons. There is the partition
unity of the property, and plurality of the 4. Limitations imposed by the owner
subjects. himself - voluntary servitudes, mortgages,
pledges, lease and deed of restrictions.
Attributes of Ownership 5. Limitations inherent in the property –
1. Right to enjoy (jus utendi) co-ownership
2. Right to the fruits (jus fruendi)
3. Right to abuse (jus abutendi) Principle of Self-Help, Art. 429, NCC
4. Right to dispose (jus dispodendi) This principle authorizes an owner or lawful
5. Right to recover (jus vindicandi) possessor of a property to use reasonable
6. Right to accessories (jus accessiones) counterforce to prevent or stop another person
7. Right to possess (jus possidendi) from taking the former’s property. There must be
no delay in the pursuit, otherwise, his recourse
1. Right to Enjoy: will be to go to the court for the recovery of
a. to possess (jus possidendi) property.
b. to use (jus utendi)
c. to the fruits (jus fruendi) and accessories (jus Requisites:
accessiones) 1. The force must be employed by the owner
d. to abuse (jus abutendi) or lawful possessor;
2. There must be an actual or threatened
2. Right to Dispose: physical invasion or usurpation of property;
a. to destroy 3. The invasion or usurpation must be
b. to alienate unlawful; and
c. to transform 4. The force employed must be reasonably
d. to encumber necessary to repel the invasion or
usurpation.
3. Right to Vindicate:
a. to recover State of Necessity Art. 432, NCC
• The owner of a thing has no right to
4. Right to Exclude: prohibit interference of another with the
a. to enclose, fence and delimit same if,
b. to repel intrusions even with force • The interference is necessary to avert an
imminent danger, and
Surface Rights • The threatened damage, compared to the
The owner of parcel of land is the owner of its surface damage arising to the owner from the
and everything under it. The economic utility which interference, is much greater.
such space or subsoil offers to the owner of the
The owner may demand compensation from
surface sets the limit of the owner’s right to the same.
the person benefited for the damage to him.
BAR QUESTION (2014) SUGGESTED ANSWER

Spouses Magtanggol manages and A.
operated a gasoline station on a 1,000 For damages suffered by the owner
sq.m. lot which they leased from resulting from the State’s exercise of police
Francisco Bigla-awa. The contract was power, the owner cannot recover
for a period of three (3) years. When the compensation because the power is
contract expired, Francisco asked the exercised for the promotion of the general
Spouses to peacefully vacate the welfare.
premises. The Spouses ignored the
B.
demand and continued with the operation
For damages suffered by the owner
of the gasoline station.
resulting from the State’s exercise of
eminent domain, the owner has the
One month after, Francisco, with the aid constitutional right to ask for compensation.
of a group of armed men, caused the This is consistent with the constitutional
closure of the gasoline station by provision that no property may be taken by
the State for public use without payment of
constructing fences around it.
just compensation.
Was the act of Francisco and his men B. RIGHTS OF ACCESSION

lawful? Why? (4%)
as SUGGESTED ANSWER 1. GENERAL PRINCIPLES
It may be defined as the right pertaining to the
No, the act of Francisco was not lawful. owner of a thing over everything which is
Even if the lessee’s right to occupy the produced thereby (accession discreta), or which
premises has expired, the lessor cannot is incorporated or attached thereto (accession
physically oust the lessee from the continua), either naturally or artificially (Art. 440,
leased premises if the latter refuses to NCC).
vacate. The lessor must go through the
proper channels by filing an appropriate Accession Discreta (produced by the
case for unlawful detainer or recovery of property)
possession. Every person has a right to - To the owner belong the Natural, Industrial and
be respected in his possession and Civil fruits
should he be disturbed therein, he shall • Natural Fruits – spontaneous product of the
be protected in or restored to said soil and young and other products of animals
possession by the means established by • Industrial Fruits – produced by lands of any
the laws and the Rules of Court (Article kind through cultivation or labor
539, Civil Code). The act of Francisco • Civil Fruits – rent of buildings, price of leases
and his men constitute an abuse of rights of land and other property and amount of
because even if he has the right to perpetual or life annuities or other similar
recover possession of his property, he income
must act with justice and give the lessees
their day in court and observe honesty EXCEPTIONS: If the thing is:
and good faith. (Article 19, Civil Code). a. in possession of a possessor in good faith;
Owner must resort to legal process to b. subject to a usufruct;
recover possession. c. leased; or
d. in possession of an antichretic creditor
BAR QUESTION (2014)
Can a property owner demand just Art. 680. If the branches of any tree should
extend over a neighboring estate, tenement,
compensation from the government for garden or yard, the owner of the latter shall have
damages suffered in the State’s exercise the right to demand that they be cut off insofar as
of: they may spread over his property, and, if it be
A. Police power? Explain. the roots of a neighboring tree which should
penetrate into the land of another, the latter may
B. Power of eminent domain? Explain. cut them off himself within his property.
Rules regarding intrusions or extensions of • Made by Chance; and

branches and roots • He is not a Trespasser or Agent of the
1. Branches — adjacent owner has the right to landowner (Art. 438(2), NCC).
demand that they be cut off.
2. Roots — he may cut them off himself “By Chance”
• The finder had no intention to search for the
Art. 681. Fruits naturally falling upon adjacent treasure.
land belong to the owner of said land. • There is no agreement between the owner of
the property and the finder for the search of
Rules as to Fruits the treasure.
1. If the fruits still hang on the tree, they are still
owned by the tree owner. 2. ACCESSION INDUSTRIAL
2. It is only after they have naturally fallen that Accession brought about by human industry and
they belong to the owner of the invaded land may take the form of building, planting or sowing.
Accession Continua (incorporated or Art. 448. The owner of the land on which
attached to the property) anything has been built, sown or planted in good
The right pertaining to the owner of a thing over faith, shall have the right to appropriate as his
everything that is incorporated or attached own the works, sowing or planting, after payment
thereto either naturally or artificially; by external of the indemnity provided for in Articles 546 and
forces. 548, or to oblige the one who built or planted to
Reasons: Economic convenience is better pay the price of the land, and the one who
sowed, the proper rent. However, the builder or
attained in a state of single ownership than in a
planter cannot be obliged to buy the land if its
co-ownership, and natural justice demands that
value is considerably more than that of the
the owner of the principal should also own the
building or trees. In such case, he shall pay
accessory
reasonable rent, if the owner of the land does not
choose to appropriate the building or trees after
Accession continua with respect to
proper indemnity. The parties shall agree upon
Immovables
the terms of the lease and in case of
1. Accession Industrial – building, planting,
disagreement, the court shall fix the terms
sowing
thereof.
2. Accession Natural – alluvium, avulsion,
change of river beds and formation of islands Art. 546. Necessary expenses shall be refunded
to every possessor; but only the possessor in
Accession continua with respect to Movables good faith may retain the thing until he has been
1. Adjunction or conjunction reimbursed therefor. Useful expenses shall be
2. Mixture refunded only to the possessor in good faith with
3. Specification the same right of retention, the person who has
defeated him in the possession having the option
Right to Hidden Treasure of refunding the amount of the expenses or of
It is any hidden and unknown deposit of money, paying the increase in value which the thing may
jewelry or other precious objects, the lawful have acquired by reason thereof.
ownership of which does not appear (Art 439,
NCC). Art. 548. Expenses for pure luxury or mere
pleasure shall not be refunded to the possessor
Rules regarding discovery of hidden treasure in good faith; but he may remove the ornaments
• GR: If the finder is the owner of the land, with which he has embellished the principal thing
building, or other property where it is found, if it suffers no injury thereby, and if his successor
the entire hidden treasure belongs to him. in the possession does not prefer to refund the
• EXCEPTION: If the finder is not the owner or amount expended.
is a stranger who is not a trespasser (includes
the lessee or usufructuary), he is entitled to ½ Art. 447. The owner of the land who makes
thereof (Art 566, NCC). thereon, personally or through another, plantings,
• If found to be of interest to science or the arts, constructions or works with the materials of
the State may acquire them at their just price, another, shall pay their value; and, if he acted in
which shall be divided in conformity with the bad faith, he shall also be obliged to the
above-stated rule reparation of damages. The owner of the
materials shall have the right to remove them
Requisites in order that the finder be entitled only in case he can do so without injury to the
to any share in the hidden treasure: work constructed, or without the plantings,
• Discovery was made on the property of constructions or works being destroyed.
Another, or of the State or any of its political However, if the landowner acted in bad faith, the
subdivisions; owner of the materials may remove them in any
event, with a right to be indemnified for damages.
Art. 449. He who builds, plants or sows in bad Tests to determine the principal?
faith on the land of another, loses what is built, 1. Rule of Importance and Purpose - That to
planted or sown without right to indemnity. which the other has been united as an
ornament, or for its use or perfection. (Art.
Art. 450. The owner of the land on which 467)
anything has been built, planted or sown in bad 2. If it cannot be determined in Art 467 -
faith may demand the demolition of the work, or
that of greater VALUE - (Art. 468, NCC)
that the planting or sowing be removed, in order
3. If two things are of EQUAL VALUE - That
to replace things in their former condition at the
of greater VOLUME.
expense of the person who built, planted or
sowed; or he may compel the builder or planter to
pay the price of the land, and the sower the COMMIXTION OR CONFUSION
proper rent. Takes place when two or more things
belonging to different owners are mixed or
Art. 451. In the cases of the two preceding combined with the respective identities of the
articles, the landowner is entitled to damages component parts destroyed or lost.
from the builder, planter or sower.
Kinds: The mixture may be voluntary or by
Art. 452. The builder, planter or sower in bad chance.
faith is entitled to reimbursement for the (1) Commixtion or the mixture of solid things
necessary expenses of preservation of the land. belonging to different owners.
(2) Confusion or the mixture of liquid things
Art. 454. When the landowner acted in bad faith belonging to different owners.
and the builder, planter or sower proceeded in
good faith, the provisions of article 447 shall 1. Mixture by will of both the owners, both in
apply. good faith or by chance:
a. Their rights shall first be governed by their
Rules of Accession continua in movable stipulations.
property (industrial) b. If the things mixed are of the same kind and
quality, there is no conflict of rights, and the
Adjunction or conjunction
mixture can easily be divided between the 2
Process by virtue of which 2 movable things
owners.
belonging to different owners are united in such a
way that they form a single object. c. If the things mixed are of different kind and
quality, in the absence of a stipulation, each
Different kinds of adjunction owner acquires a right or interest in the
a. Inclusion/engraftment mixture in proportion to the value of his
b. Soldadura/ soldering material as in co-ownership.
c. Escritura/ writing
d. Pintura/ painting 2. Mixture caused by an owner in bad faith:
e. Weaving/ tejido The owner in bad faith not only forfeits the thing
belonging to him but also becomes liable to pay
Requisites: indemnity for the damages caused to the other
(1) 2 movables; owner.
(2) Belonging to different owners;
(3) United forming a single object; SPECIFICATION
(4) Separation would impair their nature or • Takes place whenever the work of a person
result in substantial injury to either thing. is done on the material of another, and such
material, as a consequence of the work
Rules in Adjunction: itself, undergoes a transformation.
1. If separation is possible – separate (no • It is the giving of new form to another’s
accession)
material through application of labor. The
2. If separation not possible
material undergoes a transformation or
a) Good faith – Accessory follows the
change of identity. The labor is the
principal, with reimbursement.
principal and the materials used is the
*** If accessory is more precious than
principal, owner of accessory may accessory.
demand separation even though the other
will suffer injury Rules:
b) Bad faith (accessory) – owner loses 1. Worker and owner of the materials in
accessory with liability to pay damages good faith:
c) Bad faith (principal) – owner of - The worker becomes the owner of the
accessory may choose between (1) work/transformed thing but he must indemnify
reimbursement plus damages or (2) the owner of the material for its value.
separation plus damages.
Exception: If the material is more precious or Forms of accession natural

of more value than the work/transformed thing, • Alluvium
the owner of the material may choose: • Avulsion
a. To appropriate the new thing to himself but • Change of course of rivers
must pay for the value of the work or labor, • Formation of islands
OR
b. To demand indemnity for the material. 1. ALLUVIUM
The soil deposited or added to the lands
2. Worker in bad faith but the owner of the adjoining the banks of rivers, and gradually
materials in good faith: received as an effect of the current of the
- The owner of the material has the option waters.
either:
a. To appropriate the work to himself without Accretion
paying the maker, plus damages OR • Process by which the soil is deposited.
b. To demand the value of the material, plus • A broader term than alluvium
damages.
Requisites:
Limitation: The first option is not available in 1. The deposit should be gradual and
case the value of the work, for artistic or imperceptible
scientific reasons, is considerably more than 2. Cause is the current of river
that of the material, to prevent unjust 3. Cannot be done artificially or man-made
enrichment. Only the second option is causes
available. 4. That the land where accretion takes place is
adjacent to the bank of the river.
3. Owner of the materials in bad faith but the
worker is in good faith: There can be no acquisition of soil deposited
- The owner of the material is in bad faith when on the shores of the sea
he does not object to the employment of his • it belongs to the State as property of public
materials. Accordingly, he shall lose his domain
materials and shall have the obligation to • 4 bodies of water – rivers, lakes, creeks or
indemnify the worker for the damages he may torrents
have suffered. • Laguna de Bay is a lake
• Manila Bay is a sea (Heirs of Navarro vs
4. Both owners are in bad faith: IAC, G.R. No. 68166 February 12, 1997)
- Their rights shall be determined as though
both acted in good faith. HEIRS OF NAVARRO vs. IAC | G.R. NO.
68166, FEBRUARY 12, 1997
Basic principles in accession continua Accretion as a mode of acquiring property
1. He who is in Bad faith is liable for damages. under said Article 457, requires the
2. Accessory follows the principal concurrence of the following requisites: (1) that
3. Union or incorporation must generally be the accumulation of soil or sediment be gradual
effected in such a manner that to separate and imperceptible; (2) that it be the result of the
the principal from the accessory would action of the waters of the river; and (3) that the
result in substantial Damage to either or land where the accretion takes place is
diminish its value. adjacent to the bank of the river. Accretion is
4. To the Owner of the thing belongs the the process whereby the soil is deposited, while
extension or increases to such thing. alluvium is the soil deposited on the estate
5. Bad faith of one party Neutralizes the bad fronting the river bank; the owner of such estate
faith of the other so that they shall be is called the riparian owner. Xxx
considered in good faith.
6. He who is in Good faith may be held The alluvium, by mandate of Article 457 of the
responsible but not penalized. Civil Code, is automatically owned by the
7. No one shall unjustly Enrich himself at the riparian owner from the moment the soil deposit
expense of another. can be seen but is not automatically registered
property, hence, subject to acquisition through
3. ACCESSION NATURAL prescription by third persons.
accession that occurs by operation of nature
2. AVULSION
Art. 457. To the owners of lands adjoining A known portion of land is segregated from one
the banks of rivers belong the accretion which estate by the forceful current of a river, creek or
they gradually receive from the effects of the torrent and transferred to another.
current of the waters.
Requisites: BAR QUESTION (2013)

1. Segregation and transfer of land is sudden
and abrupt; Ciriaco Realty Corporation (CRC) sold to the
2. Caused by the current of the water; and spouses Dela Cruz a 500-square meter land
3. The portion of land transported must be (Lot A) in Paranaque. The land now has a fair
known and identifiable. market value of P1,200,000. CRC likewise sold
*** owner of segregated portion land retains to the spouses Rodriguez , a 700-square meter
ownership provided he removes within 2 years
land (Lot B) which is adjacent to Lot A. Lot B
Art. 460. Trees uprooted and carried away has a present fair market value of P1,500,000.
by the current of the waters belong to the The spouses Dela Cruz constructed a house
owner of the land upon which they may be on Lot B, relying on the representation of the
cast, if the owners do not claim them CRC sales agent that it is the property they
within six months. If such owners claim purchased. Only upon the completion of their
them, they shall pay the expenses incurred house did the spouses Dela Cruz discover that
in gathering them or putting them in a safe they had built on Lot B owned by the spouses
place.
Rodriguez, not on Lot A that they purchased.
3. CHANGE OF COURSE OF RIVER They spent 1,000,000 for the house.
Requisites: As their lawyer advise the spouses Dela
(1) Change in the natural course of the waters Cruz on their rights and obligations under
of the river; and the given circumstances, and the recourses
(2) Such change causes the abandonment of and options open to them to protect their
the river beds. interests.
• abandoned river bed ipso facto belong to
the owners whose lands are occupied by SUGGESTED ANSWER
the new course in proportion to the area I will advise spouses dela Cruz that they have
lost. the right to retain possession of the premises
• owners of the land adjoining the until spouses Rodriguez exercise any of the
abandoned bed shall have the right to options under Article 448 of the Civil Code
acquire the same by paying the value (Technogas Manufacturing vs. CA, G.R. No.
thereof, which value shall not exceed the 108894, February 10, 1997). Spouses Dela
value of the area occupied by the new Cruz are builders in good faith because before
bed. constructing their house, they exercised due
• new bed becomes property of public diligence by asking the agent of CRC the
dominion. location of Lot A. They relied on the information
given by the agent who is presumed to know
4. FORMATION OF ISLANDS the identity of the lot they purchased
They belong to the State if [NCC 464]: (Pleasantville vs. CA, G.R. No. 79688,
(1) Formed on the seas within the jurisdiction February 1, 1996 (253 SCRA10).
of the Philippines. The owner of the land on which anything has
(2) Formed on lakes, or been built in good faith by another has the right
(3) Formed on navigable or floatable rivers: to appropriate as his own the works, sowing or
a) Capable of affording a channel or planting, after payment of the indemnity or to
passage for ships and vessels; oblige the builder to pay the price of the land if
b) Must be sufficient not only to float its value is not considerably higher than the
bancas and light boats, but also bigger building or trees, or to ask the sower to pay
watercraft; proper rent. I will also advise my clients that
c) Deep enough to allow unobstructed Rodriguez may not compel them to remove the
movements of ships and vessels. improvements because it is not one of the
options granted to the land owner if the builder
is in good faith.
• They belong to the nearest riparian owner if
[NCC 465]:
• Formed through successive accumulation of C. ACTIONS TO RECOVER
alluvial deposits in non-navigable and non- OWNERSHIP AND POSSESSION
floatable rivers OF PROPERTY
• Islands belong to owners of margins of
banks nearest to each of them 1. Accion Reivindicatoria
• single island, owner of nearer margin shall 2. Accion Publiciana
be the sole owner 3. Accion Interdictal
• If in the middle, to be divided longitudinally in 4. Quieting of Title
halves
1. ACCION REIVINDICATORIA • Accion publiciana is a plenary action to

 It is an action to recover real property based recover the better right of possession
on ownership. Here, the object is the recovery (possession de jure), which should be brought
of the dominion over the property as owner. in the proper inferior court or Regional Trial
This action has a prescription period of 30 Court (depending upon the assessed value of
years. the property) when the dispossession has
 Accion reivindicatoria or accion de lasted for more than one year. The issue in an
reivindicacion or reivindicatory action, which is accion publiciana is the "better right of
an action for recovery of ownership which possession" of real property independently of
must be brought in the proper inferior court or title. This "better right of possession" may or
Regional Trial Court (depending upon the may not proceed from a Torrens title. Thus, a
assessed value of the property). lessee, by virtue of a registered lease contract
 In an accion reivindicatoria, the cause of or an unregistered lease contract with a term
action of the plaintiff is to recover possession longer than one year may file, as against the
by virtue of his ownership of the land subject owner or usurper, an accion publiciana if he
of the dispute. (Heirs of Cullado vs. Gutierrez, has been dispossessed for more than one
G.R. No. 212938, July 30, 2019) year. In the same manner, a registered owner
or one with a Torrens title can likewise file an
BAR QUESTION (2017) accion publiciana to recover possession if the
Jacob has owned a farm land in Ramos, Tarlac. one-year prescriptive period for forcible entry
In 2012, Liz surreptitiously entered and cultivated and unlawful detainer has already lapsed.
the property. In 2014, Jacob discovered Liz’s (Miranda vs. Mallari, G.R. No. 218343,
presence in and cultivation of the property. Due November 28, 2018)
to his being busy attending to his business in
Cebu, he tolerated Liz’s cultivation of the 3. ACCION INTERDICTAL
property. Subsequently, December 2016, Jacob • It is a summary action to recover physical or
wanted to regain possession of the property; material possession and is cognizable by the
hence, he sent a letter to Liz demanding that she proper municipal trial court or metropolitan trial
vacate the property. Liz did not vacate despite court. It must be brought within one year from
the demand. the time the cause of action arises.
Jacob comes to enlist your legal assistance to • It comprises two distinct causes of action,
bring an action against Liz to recover the namely, forcible entry (detentacion) and
possession of the property. unlawful detainer (desahuico).
What remedies are available to Jacob to
recover possession of his property under the (1) Forcible Entry:
circumstance? Explain your answer (4%) • Lawful possessor deprived through (Force,
SUGGESTED ANSWER Intimidation, Strategy, Threats, Stealth). Prior
physical possession must be alleged.
There are three remedies for recovery of • Prescription: 1 year from dispossession
possession of immovable, to wit: accion (force, intimidation, threats) or from knowledge
interdictal, accion publiciana and accion of dispossession (strategy, stealth).
reivindicatoria. • In forcible entry, one is deprived of the
physical possession of real property by means
I will advise Jacob to file an accion publiciana of force, intimidation, strategy, threats, or
against Liz. It is an ordinary civil proceeding to stealth, whereas in unlawful detainer, one
determine the better right of possession of realty illegally withholds possession after the
independently of the title. Since the possession
expiration or termination of his right to hold
of Liz was illegal from the start, the proper
possession under any contract, express or
remedy should have been a forcible entry case
implied.
(Zacarias vs. Anacay G.R. No. 201354,
September 24, 2014). However, because the
(2) Unlawful Detainer:
action is to be filed more than one year from
discovery of unlawful possession by stealth,
Jurisdictional facts of unlawful detainer:
Jacob can no longer avail of the remedy of (i) initially, possession of property by the
forcible entry but he could still recover defendant was by contract with or by
possession by an accion publiciana. tolerance of the plaintiff;
(ii) eventually, such possession became illegal
upon notice by plaintiff to defendant of the
2. ACCION PUBLICIANA termination of the latter's right of possession;
• It is an ordinary civil proceeding to (iii) thereafter, the defendant remained in
recover the better right of possession, possession of the property and deprived the
except in cases of forcible entry and plaintiff of the enjoyment thereof; and
unlawful detainer. What is involved here is (iv) within one year from the last demand on
not possession de facto but possession defendant to vacate the property, the plaintiff
de jure. instituted the complaint for ejectment
Distinctions between forcible entry and • It is not necessary that the person seeking to
unlawful detainer quiet his title be the registered owner of the
• An action for forcible entry is distinguished property. He need not be in possession of
from an unlawful detainer case, such that in said property.
the former, the possession of the defendant is • “Title” is not limited to the certificate of
illegal from the very beginning, whereas in the registration under the Torrens System (i.e.
latter action, the possession of the defendant OCT or TCT). It was held that title to real
is originally legal but became illegal due to property refers to that upon which ownership
the expiration or termination of the right to is based. It is the evidence of the right of the
possess. owner or the extent of his interest, by which
means he can maintain control and, as a
4. QUIETING OF TITLE rule, assert a right to exclusive possession
• Quieting of title is a common law remedy for and enjoyment of the property. It can
the removal of any cloud upon or doubt or connote acquisitive prescription by
uncertainty with respect to title to real possession in the concept of an owner.
property. (Evangelista, et al. v. Santiago, G.R. No.
• Its purpose is to secure an adjudication that a 157447, April 29, 2005)
claim of title to or an interest in property,
adverse to that of the complainant, is invalid,
Cloud on Title
so that the complainant and those claiming
• A “cloud on title” is an outstanding
under him may be forever afterward free from
instrument, record, claim, encumbrance or
any danger of hostile claim. (Heirs of Tappa
proceeding which is actually invalid or
v. Heirs of Bacud, G.R. No. 187633, April 4,
inoperative, but which may nevertheless
2016)
impair or affect injuriously the title to that
Article 476. Whenever there is a cloud on title to property.
real property or any interest therein, by reason of • The matter complained of must have prima
any instrument, record, claim, or encumbrance facie appearance of validity or legal efficacy.
or proceeding which is apparently valid or The cloud on title is a semblance of title
effective but is in truth and in fact invalid, which appears in some legal form but which
ineffective, voidable, or unenforceable, and may is in fact unfounded. The invalidity or
be prejudicial to said title, an action may be inoperativeness of the instrument is not
brought to remove such cloud or to quiet the apparent on the face of such instrument, and
title. it has to be proved by extrinsic evidence.
(Evangelista, et al. v. Santiago, G.R. No.
An action may also be brought to prevent a 157447, April 29, 2005)
cloud from being cast upon title to real property
or any interest therein. A cloud on a title exists when
a. There is an instrument (deed or contract) or
Article 478. There may also be an action to record or claim or encumbrance or
quiet title or remove a cloud therefrom when the proceeding;
contract, instrument or other obligation has been b. Which is apparently valid or effective;
extinguished or has terminated, or has been c. But is, in truth and in fact, invalid,
barred by extinctive prescription. ineffective, voidable, or unenforceable, or
extinguished (or terminated) or barred by
Requisite: extinctive prescription; and
a. The plaintiff has a legal or an equitable title to d. May be prejudicial to the title. (Heirs of
or interest in the real property subject of the Tappa v. Heirs of Bacud, G.R. No. 187633,
action; and April 4, 2016)
b. The deed, claim, encumbrance or proceeding
claimed to be casting cloud on his title must PRESCRIPTIVE PERIOD
be shown to be in fact invalid or inoperative If the plaintiff is not in possession of the
despite its prima facie appearance of validity property.
or legal efficacy. • The action prescribes after 30 years. This is
pursuant to Article 1141 of the Civil Code
Legal or Equitable Title which provides that real actions over
• Pursuant to Article 477, the plaintiff must
immovables prescribe after 30 years.
have legal or equitable title to, or interest in,
• Nevertheless, the 30-year prescriptive
the real property subject of the action for
period is without prejudice to what is
quieting of title. In the absence of such legal
established for the acquisition of ownership
or equitable title, or interest, there is no cloud
and other real rights by prescription.
to be prevented or removed.
• In the case of ownership and other real rights replevin has the burden of proving his
over immovable property, they are acquired ownership and/or right of possession over the
by ordinary prescription through possession property in question. Wrongful detention by
in good faith and with just title for a period of the defendant of the property sought in the
10 years. action must be satisfactorily established.
• On the other hand, ownership and other real • Replevin is both a form of principal remedy
rights over immovable also prescribe through (i.e., to regain possession) and of a
uninterrupted adverse possession thereof for provisional remedy that would allow the
30 years, without need of title or of good faith plaintiff to retain the thing wrongfully detained
(extraordinary acquisitive prescription). by another pendente lite.
• The action shall prescribe four or eight years
2. If the plaintiff is in possession of the from the time the possession thereof is lost, in
property, the action is imprescriptible. accordance with Article 1132.
Rationale: A person in actual possession of a • A property that is validly in custodia legis
piece of land under claim of ownership may wait cannot be the subject of a replevin suit.
until his possession is disturbed or his title is (Calub v. Court of Appeals, 331 SCRA 55
attacked before taking steps to vindicate his [2000].)
right, and his undisturbed possession gives him
the continuing right to seek the aid of a court of D. CO-OWNERSHIP
equity to ascertain and determine the nature of • Ownership of an undivided thing or right
the adverse claim of a third party and its effect belongs to different persons
on his title. (Rumarate v. Hernandez, 487 SCRA • Right of common dominion which two or more
317 (2006)) persons have in a spiritual part of a thing
which is not materially or physically divided.
Reconveyance vs. Quieting
• An action for reconveyance is one that seeks Characteristics of Co-Ownership
to transfer property, wrongfully registered by • There must be more than one subject or
another, to its rightful and legal owner. owner
• Reconveyance is an action distinct from an • There is one physical whole divided into ideal
action for quieting of title, which is filed shares
whenever there is a cloud on title to real • Each ideal share is definite in amount but is
property or any interest therein, by reason of not physically segregated from the rest
any instrument, record, claim, encumbrance
or proceeding which is apparently valid or Sources of Co-Ownership
effective but is in truth and in fact, invalid, 1. By law
ineffective, voidable, or unenforceable, and 2. By contract
may be prejudicial to said title for purposes of 3. By chance
removing such cloud or to quiet title (Ney v. 4. By occupation or occupancy
Quijano. G.R. No. 178609, August 4, 2010). 5. By succession or will
REPLEVIN Rights of Co-Ownership

• is defined as an action or provisional remedy 1. Right to Share in the Benefits as well as
where the complainant prays for the recovery the Charges
of the possession of personal property. (Sec. • Proportional to their interests; Stipulation to
1, Rule 60, Rules of Court). the contrary is void;
• Recovery of possession of a personal • Portion belonging to the co-owners is
property. presumed equal.
• Manual delivery of personal property which is
governed by Rule 60 of the Rules of Court. 2. Right to use the thing owned in common
• Section 2 thereof requires the plaintiff to state • Use the thing in accordance with the purpose
in an affidavit that he is the owner of the for which it is intended.
property claimed, particularly describing it, or • Use it in such a way as to not injure the
that he is entitled to the possession thereof interest of the co-ownership or prevent the
and that it is “wrongfully detained by the other co-owners from using it according to
adverse party.’’ The applicant for the writ of their right.
• If co-owner exclusively uses property owned Modes of Extinguishment of Co-Ownership

in common, he is liable to pay rentals for 1. Consolidation or merger in one co-owner;
other co-owners’ share 2. Acquisitive prescription in favor of a third
person or a co-owner who repudiates;
Decisions affecting co-ownership 3. Loss or destruction of thing co-owned;
4. Sale of thing co-owned;
1. Acts of preservation, maintenance, 5. Termination of period agreed upon;
necessary repairs 6. Expropriation;
7. Judicial or extra-judicial Partition.
Any co-owner may decide, but he must, if
practicable, first notify the other co-owners;
2. CONTRIBUTION FOR EXPENSES
Anyone may exempt himself from contribution
• The share of the co-owners, in the benefits as
by renouncing his interest unless waiver is
well as in the charges, shall be proportional to
prejudicial to co-ownership
their respective interests. Any stipulation in a
contract to the contrary shall be void.
2. Acts of administration or management
• The portions belonging to the co-owners in the
Majority of the co-owners; majority of interest co-ownership shall be presumed equal, unless
(controlling); the contrary is proved. (Art. 485)
• Each co-owner shall have a right to compel
3. Acts of alterations, encumbrance or the other co-owners to contribute to the
alienations expenses of preservation of the thing or right
Unanimous consent of all owned in common and to the taxes. Any one
of the latter may exempt himself from this
Alteration is an act by virtue of which a co- obligation by renouncing so much of his
owner changes the thing from the state in undivided interest as may be equivalent to his
which the others believe it should remain, or share of the expenses and taxes. No such
withdraws it from the use to which they desire it waiver shall be made if it is prejudicial to the
to be intended. co-ownership. (Article 488)
• Repairs for preservation may be made at the
Effects of alteration without the express or will of one of the co-owners, but he must, if
implied consent of co-owners practicable, first notify his co-owners of the
A co-owner who makes an alteration without necessity for such repairs. (Article 489)
the express or implied consent of the others • Expenses to improve or embellish the thing
shall be decided upon by a majority.
shall:
1. Lose what he has spent;
3. REDEMPTION
2. Obliged to Demolish the improvements
Art. 1620. A co-owner of a thing may exercise
done; and
the right of redemption in case the shares of all
3. Pay for the loss and damages the
the other co-owners or of any of them, are sold to
community property or other co-owners may
a third person. If the price of the alienation is
have suffered.
grossly excessive, the redemptioner shall pay
only a reasonable one.
1. DISTINCTIONS BETWEEN RIGHT TO
Should two or more co-owners desire to exercise
PROPERTY OWNED IN COMMON AND
the right of redemption, they may only do so in
FULL OWNERSHIP OVER THE IDEAL proportion to the share they may respectively
SHARE have in the thing owned in common.
 A co-owner has full ownership of his share
(undivided interest) and the fruits and Art. 1623. The right of legal pre-emption or
benefits arising therefrom. redemption shall not be exercised except within
 Being the full owner thereof he may alienate, thirty days from the notice in writing by the
assign or mortgage it; he can also substitute prospective vendor, or by the vendor, as the case
another person in the enjoyment of his may be. The deed of sale shall not be recorded in
share, except only when personal rights are the Registry of Property, unless accompanied by
involved. an affidavit of the vendor that he has given
 Others may seek for partition at anytime, the written notice thereof to all possible
same is imprescriptible redemptioners.
Art. 1088. Should any of the heirs sell his 4. PARTITION

hereditary rights to a stranger before the
Rule:
partition, any or all of the co-heirs may be
• Every co-owner has the right to demand
subrogated to the rights of the purchaser by partition.
reimbursing him for the price of the sale, • No co-owner shall be obliged to remain in the
provided they do so within the period of one co-ownership. Action to demand partition is
imprescriptible.
month from the time they were notified in
writing of the sale by the vendor. Exception:
1. When partition would render the thing
PAZ GALVEZ vs. HON. COURT OF Unserviceable; or
APPEALS | G.R. No. 157954, March 24, 2. When the thing is essentially Indivisible;
3. When partition is prohibited by Law by reason
2006 of their origin or juridical nature- ex. party
• The purpose of Article 1067 (of the old walls and fences;
Civil Code, now Article 1088 of the present 4. When the co-owners Agree to keep the
Civil Code) is to keep strangers to the property undivided for a period of time but not
more than 10 yrs;
family out of a joint ownership, if, as is
5. When partition is Prohibited by the transferor
often the case, the presence of outsiders (donor / testator) but not more than 20 yrs;
be undesirable and the other heir or heirs 6. When a co-owner possessed the property as
be willing and in a position to repurchase an Exclusive owner for a period sufficient to
acquire it through prescription. (Acquisitive
the share sold (De Jesus vs. Manlapus, 81
Prescription)
Phil. 144). While there should be no 7. When Co-owners may agree that it be
question that an heir may dispose his right Allotted to one of them reimbursing the
before partition (Rivero vs. Serrano [CA] others;
46 O.G. 642; Wenceslao vs. Calimon, 46 8. If they cannot agree, they may Sell the thing
and distribute the proceeds.
Phil. 906; Hernaez vs. Hernaez, 32 Phil.
214), a co-heir would have had to pay only
the price for which the vendee acquired it BAR QUESTION (2014)
(Hernaez vs. Hernaez, Ibid.). X, Y, Z are siblings who inherited a 10-storey
• It is a one-way street. It is always in favor building from their parents. They agreed in
of the redemptioner since he can compel writing to maintain it as a co-owned property for
the vendee to sell to him but he cannot be leasing out and to divide the net profits among
themselves equally for a period of 20 years.
compelled by the vendee to buy the
On the 8th year, X wanted to get out of the co-
alienated property. ownership so he could get his 1/3 share in the
• In another case, this Court reiterated that: property. Y and Z refused, saying X is bound
Legal redemption is in the nature of a by their agreement to keep the co-ownership
for 20 years.
privilege created by law partly for reasons
of public policy and partly for the benefit Are Y and Z correct?
and convenience of the redemptioner, to
SUGGESTED ANSWER
afford him a way out of what might be a
disagreeable or [an] inconvenient Y and Z are partly correct. The law provides
that none of the co-owners shall be obliged to
association into which he has been thrust.
remain in the co-ownership and it is the right of
(10 Manresa, 4th Ed., 317.) It is intended a co-owner to ask for partition of the co-
to minimize co-ownership. The law grants ownership anytime. One exception to the rule is
a co-owner the exercise of the said right of if the co-owners agree to keep the thing
undivided which period shall not exceed ten
redemption when the shares of the other
years.
owners are sold to a "third person."
• The rule on redemption is liberally In this case, the agreement to keep the thing
construed in favor of the original owner of undivided shall be valid for ten years. Hence,
the property and the policy of the law is to X must wait for said period to lapse before he
can demand for partition. (Article 494, Civil
aid rather than defeat him in the exercise Code)
of his right of redemption.
E. POSSESSION The general rule is that the possession and

cultivation of a portion (e.g., 1/4) of a tract of
Is the holding of a thing or the enjoyment of a land under claim of ownership of all is
right constructive possession of all.
Requisites of Possession The doctrine does not apply where the

1. CORPUS or the possession in fact or possession is wrongful or the part allegedly
holding or control of a thing or right; constructively possessed is in the adverse
2. ANIMUS POSSIDENDI or the deliberate possession of another. (Rosales v. Director of
intention to possess the thing or right. Lands, 51 Phil. 302 [1927]; Ramos v. Director of
Lands, supra.; Sarmiento v. Lesaca, 108 Phil.
Possession v. Ownership 900 [1960].)
• OWNERSHIP confers certain rights to the
owner, among which are the right to enjoy Effects of Possession
Art. 539. Every possessor has a right to be
the thing owned and the right to exclude
respected in his possession; and should he be
other persons from possession thereof while
disturbed therein he shall be protected in or
POSSESSION is defined as the holding of a
restored to said possession by the means
thing or the enjoyment of a right. Literally, to
established by the laws and the Rules of Court.
possess means to actually and physically
occupy a thing with or without right.
A possessor deprived of his possession through
• A person may be declared owner but he
forcible entry may within ten days from the filing
may not be entitled to possession.
of the complaint present a motion to secure from
• A judgment for ownership, therefore, does the competent court, in the action for forcible
not necessarily include possession as a entry, a writ of preliminary mandatory injunction
necessary incident. (Heirs of R. Soriano v. to restore him in his possession. The court shall
Court of Appeals, 153 SCAD 86, 363 SCRA decide the motion within thirty (30) days from the
87 [2001].) filing thereof
• Just as possession is a definite proof of
ownership, neither is non-possession 1. POSSESSION IN THE CONCEPT OF A
inconsistent with ownership. (Medina vs. HOLDER
Greenfield Dev. Corp., 443 SCRA 150  possessor holds it merely to keep or enjoy it,
[2004].) the ownership pertaining to another person;
possessor acknowledges in another a
Presumptions in favor of Possessor: superior right which he believes to be
1. Of good faith ownership
2. Of continuity of initial good faith  A possessor merely in the concept of holder
3. Of enjoyment in the same character in which cannot acquire property by acquisitive
possession was acquired until the contrary is prescription—one cannot recognize the right
proved of another and at the same time claim
4. Of non-interruption in favor of the present adverse possession.
possessor
5. Of continuous possession by the one who Examples:
recovers possession of which he was 1. Lessees
wrongfully deprived 2. Trustees
6. Of extension of possession of real property 3. Antichrectic creditors
4. Agents
to all movables contained therein
5. Depositaries
Doctrine of Constructive Possession
Possession in the eyes of the law does not 2. POSSESSION IN THE CONCEPT OF AN
mean that a man has to have his feet on every OWNER
square meter of ground before it can be said • possessor of the thing or right, by his actions,
that he is in possession. (Ramos v. Director of is considered or is believed by other people
Lands, supra.) as the owner, regardless of the good or bad
faith of the possessor
• If a person possesses in the concept of  Possessor in bad faith is entitled only to

owner—he may eventually become the owner reimbursement of necessary expenses.
by prescription  For ornamental expenses, a possessor in bad
faith may remove them if it can be done without
3. RELEVANCE OF GOOD FAITH AND damage to the principal thing UNLESS the one
who recovers possession opted to appropriate
BAD FAITH
the same by paying their value at the time he
enters into possession. (Art. 549)
Possessor in Good Faith
 Possessor in bad faith shall be liable for
• One who is not aware that there exists in his
deterioration or loss of the thing in every case,
title or mode of acquisition any flaw which even if due to fortuitous event (Art 552)
invalidates it. (Art. 526, NCC)
• Mistake upon a doubtful or difficult question of 4. RULES FOR MOVABLES
law may be the basis of good faith (Art. 525)
 A possessor in the concept of owner has in General Rule: Possession of Movables in good
his favor the legal presumption that he faith is equivalent to TITLE.
possesses with a just title and he cannot be
obliged to show or prove it. (Art. 541) Requisites:
 A possessor in good faith is entitled to the a. possession is in good faith
fruits received before possession is legally b. the owner has voluntarily parted with the
interrupted. (Art. 544) possession of the thing
o Natural and industrial fruits are considered c. possessor is in the concept of owner
received from the time they are gathered or
severed One who has lost or has been unlawfully
o Civil fruits are deemed to accrue deprived of it, may recover it from whomsoever
 Necessary expenses shall be refunded to possesses it, ordinarily, without reimbursement.
every possessor BUT only a possessor in (reimburse the price paid if possessor acquired
good faith may RETAIN the thing until he has the thing in good faith and at a public sale).
been reimbursed therefor.
 Useful expenses shall be refunded only to a Summary of Recovery or Non-recovery of
possessor in good faith with the same right of possession
retention. (Art. 546) 1. Owner may recover without reimbursement
o Refund either amount of expenses or a. From possessor in bad faith
the increase in value that the thing may b. From possessor in good faith — if owner has
have acquired by reason thereof lost or has been unlawfully deprived
 Possessor in good faith may remove the
useful improvements if it can be done without 2. Owner may recover but should reimburse
damage to the principal thing UNLESS the a. If the possessor acquired the object in good
faith at a public sale or auction
one who recovers possession opted to
appropriate the same by paying
3. Owner cannot recover, even if he offers to
reimbursement in Art 546. (Art. 547)
reimburse
 Expenses for pure luxury or mere pleasure
a. If the possessor acquired it in good faith and
shall not be refunded to a possessor in good
for value by purchase from a merchant’s store,
faith, but the latter may remove them if it can
fairs, or markets in accordance with the Code
be done without damage to the principal thing
of Commerce
UNLESS the one who recovers possession
b. If owner by his own conduct is precluded form
opted to appropriate the same by paying
denying the seller’s authority to sell
reimbursement. c. If possessor had obtained the goods because
 Possessor in good faith shall not be liable for he was an innocent purchaser for value and
the deterioration or loss of the thing EXCEPT holder of a negotiable document of title.
if he is guilty of fraud or negligence d. If recovery is no longer possible because of
prescription.
Possessor in Bad Faith e. If the possessor is now the owner of the thing
• One who is not in good faith, or one who is in accordance with the principle of finder-
aware that there exists in his title or mode of keepers recognized in Art. 719 of the Civil
acquisition any flaw which invalidates it. Code.
F. USUFRUCT 5. To Set-off the improvements he may have

made on the property against any damage to
Usufruct is a temporary real right which gives a the same (Art. 580, NCC)
right to enjoy the property of another, as well as 6. To Collect reimbursements from the owner for
its fruits, with the obligation of preserving its form indispensable extraordinary repairs, taxes on
and substance, unless the title constituting it or
the capital he advanced, and damages
the law otherwise provides. (Art. 562)
caused to him.
BAR QUESTION (2017) 7. To Retain the thing until he is reimbursed for
advances for extraordinary expenses and
Distinguish Antichresis from Usufruct
taxes on the capital (Art. 612, NCC)
SUGGESTED ANSWER 8. To Remove improvements made by him
Antichresis is a contract which gives the provided the same will not injure the property
creditor the right to receive the fruits of an (Art 579, NCC)
immovable of his debtor, with the obligation to
apply them to the payment of the interest, if Rights of the Usufructuary as to the Usufruct
owing, and thereafter to the principal of his
itself
credit (Article 2132, Civil Code). While usufruct
gives the right to enjoy the property of another 1. To Alienate or mortgage the right of usufruct
with the obligation of preserving its form and (Art. 572, NCC) Except: parental usufruct
substance, unless the title constituting it or the (Arts. 225, 226 FC), purely personal, caucion
law otherwise provides (Article 562, Civil juratoria (Art 577, NCC)
Code). 2. In a usufruct to Recover property/real right, to
Antichresis is an accessory contract, while bring the action and to oblige the owner
usufruct is a principal contract. In antichresis, thereof to give him the proper authority and
there is no obligation on the part of the creditor the necessary proof to bring the action (Art.
to file a bond upon entering into the possession 578, NCC)
of the property; whereas, in usufruct, the 3. In a usufruct of part of a Common property, to
general rule is that the usufructuary must file a exercise all the rights pertaining to the co-
bond (Article 583, Civil Code). In antichresis, ‐owner with respect to the administration and
the creditor does not have the right to introduce collection of fruits or interests (Art. 582)
improvements on the property, while a
usufructuary may make on the property held in Transmissibility. The usufructuary may convey
usufruct useful improvements or expenses for his right to usufruct by way of mortgage or may
mere pleasure provided he does not alter its alienate, lease, or transfer his right as such.
form and substance (Article 579, Civil Code).
Liability. A usufructuary who alienates or leases
1. RIGHTS AND OBLIGATIONS OF his right of usufruct shall answer for any damage
USUFRUCTUARY which the things in usufruct may suffer through
the fault or negligence of the person who
Rights of the Usufructuary substitutes him. (Article 590, Civil Code)
1. To Receive the fruits of the property in
usufruct and half of the hidden treasure he OBLIGATIONS OF THE USUFRUCTUARY
accidentally finds on the property (Arts. 566, BEFORE EXERCISING THE USUFRUCT
438, NCC) 1. To make an inventory of the property,
2. To enjoy any Increase which the thing in which shall contain an appraisal of the
usufruct may acquire through accession (Art. movables and a description of the
571, NCC) condition of the immovables.
3. To personally Enjoy the thing or lease it to 2. To give a security/ bond, binding himself to
another (Arts. 572-‐577, NCC) generally for fulfill the obligations imposed upon him (Art
the same or shorter period as the usufruct 583, NCC),
4. To make such Improvements or expenses on
the property as he may deem proper and to EXCEPT:
remove the improvements provided no a. when no one will be injured thereby
damage is caused to the property (Art. 579, b. when the usufruct is reserved by the donor
NCC), and he shall not alter its form or (usufructuary is the donor)
substance. c. in cases of caucion juratoria
Caucion Juratoria 3. To indemnify the owner for any losses due

Refers to the case contemplated by Art 587 to his negligence or of his transferees
NCC whereby a usufructuary, being unable to
file the required bond or security, files a verified SUMMARY OF RIGHTS WITH REGARD TO
petition in the proper court asking for the delivery
IMPROVEMENTS
of the house furniture for himself and his family
1. Necessary Expenses – Right of
without any bond or security. Same rule applies
reimbursement plus right of retention (Arts.
to instruments or tools necessary for an industry
546, 612 – extraordinary expenses, taxes
or vocation in which the usufructuary is
on capital)
engaged.
2. Useful and Ornamental – No right of
Failure to give bond reimbursement, but he may remove the
• Owner may demand the immovable be improvement, provided there is no damage
placed under administration, movables be to the property (Art 579, NCC) or set-off the
sold, instruments of credit be converted into improvement against any damage to the
registered certificates or be deposited in property (Art 580, NCC)
banks.
• Interest on the proceeds of the sale of SUMMARY OF RIGHTS WITH NATURAL,
movables, or on public securities and bonds, INDUSTRIAL & CIVIL FRUITS
and proceeds of the immovable placed under 1. Growing at the start of Usufruct – Belong
administration shall belong to the to the Usufructuary, without obligation to
usufructuary. refund the owner of expenses incurred.
• Owner may also RETAIN in his possession 2. Growing at the end of Usufruct – Belong
the property subject to the obligation to to the owner, but with obligation to
deliver to the usufructuary the net proceeds reimburse the usufructuary for ordinary
thereof. expenses of cultivation, seed and other
similar expenses from the proceeds of the
OBLIGATIONS OF THE USUFRUCTUARY
growing fruits.
DURING THE USUFRUCT
3. Rents are civil fruits. As they are deemed
1. To take care of the property
to accrue from day to day, they belong to
2. To make ordinary repairs
the usufructuary in proportion to the time
3. To notify the owner of urgent extra-ordinary
the usufruct may last.
repairs
4. To permit works and improvements by the
naked owner not prejudicial to the usufruct REPAIRS & TAXES
5. To pay annual taxes and charges on the • Repairs – Usufructuary for ordinary repairs,
fruits Naked owner for extraordinary repairs.
6. To pay interest on taxes on capital paid by (Arts. 592, 593)
the naked owner • Taxes – Usufructuary on fruits, Naked
7. To pay debts when the usufruct is owner on capital. (Arts. 596, 597)
constituted on the whole patrimony
8. To secure the naked owner’s or court’s BAR QUESTION (2019)
approval to collect credits in certain cases
Ms. U is a usufructuary of a piece of land
9. To notify the owner of any prejudicial act
owned by Mr. L. During the existence of the
committed by third persons
10. To pay for court expenses and costs
usufruct, Ms. U introduced various useful
regarding usufruct. improvements on the land. Upon
termination of the usufruct, Mr. L requested
OBLIGATIONS OF THE USUFRUCTUARY AT Ms. U to remove the said improvements,
THE TERMINATION OF THE USUFRUCT but Ms. U refused, demanding instead that
1. To return the thing in usufruct to the owner Mr. L reimburse her the value of the same.
unless there is a right of retention a. What is a usufruct? (2%)
2. To pay legal interest on the amount spent by b. Is Ms. U’s demand proper? Explain.
the owner for extraordinary repairs or taxes (3%)
on the capital
SUGGESTED ANSWER Normal Usufruct

When the usufructuary shall preserve the
a. A usufruct gives a right to enjoy the property of
property and return it intact in the same condition.
another with the obligation of preserving its form
and substance, unless the title constituting it or
Abnormal Usufruct
the law otherwise provides (Article 562, Civil
• Abnormal or irregular: when the usufruct
Code). The Court has further declared that a
includes things which cannot be used in a
usufruct, in essence, is nothing else but simply
manner appropriate to its nature without being
allowing one to enjoy another’s property. It is also
consumed.
defined as the right to enjoy the property of
• The usufructuary has right to make use of them
another temporarily, including both the jus utendi
and the jus fruendi, (plus, impliedly, the jus under the obligation of paying their appraised
possidendi) with the owner retaining the jus value at the termination of the usufruct, if they
disponendi or the power to alienate the same were appraised when delivered.
(Moralidad v. Sps. Pernes, G.R. No. 152809, • If they were not appraised, he has the right to
August 3, 2006). return the same quantity and quality, or pay
their current price at the time the usufruct
b. No, the demand is not proper. The Civil Code ceases. [NCC 574]
provides that the usufructuary may make on the
property held in usufruct any useful 3. EXTINGUISHMENT OF THE USUFRUCT
improvements, or expenses for mere pleasure, 1. By the death of the usufructuary, unless a
which he may deem proper, provided he does not contrary intention clearly appears;
alter its form or substance; but he shall have no 2. By the expiration of the period for which it was
right to be indemnified therefor. He may, constituted, or by the fulfillment of any
however, remove such improvements should it resolutory condition provided in the title
be possible to do so without injury to the property creating the usufruct;
(Article 579, Civil Code). Ms. U, thus, has no 3. By merger of the usufruct and ownership in the
right to be indemnified for any improvements same person;
which she might have made on the land held in 4. By renunciation of the usufructuary;
usufruct. She may only remove them should it be 5. By the total loss of the thing in usufruct;
possible to do so without injury to the property, or 6. By the termination of the right of the person
set-off its value against the damages caused to constituting the usufruct;
the property due to his fault or negligence. 7. By prescription.
2. CLASSES OF USUFRUCT Death of Usufructuary

AS TO NUMBERS OF Constituted in favor of several persons living at
ACCORDING TO
PERSONS ENJOYING the time of its constitution shall not be
QUANTITY/ EXTENT
THE RIGHT extinguished until the death of the last survivor
 As to fruits — (Art 611, NCC), unless the title constituting it
 Simple
total or partial otherwise provides.
 Multiple
 As to object —
a. Simultaneous
universal or Fulfillment of resolutory condition
b. Successive • A resolutory condition (condition subsequent)
particular
AS TO MANNER OF extinguishes the obligation upon its fulfillment.
CONDITION/PERIOD CONSTITUTION The obligation is demandable at once, without
prejudice to the effects of the happening of the
 Pure  Conventional event.
 Conditional  Legal • The expiration of the period for which the
 With a term  Prescription usufruct was constituted or the fulfillment of the
resolutory condition imposed on the usufruct by
Usufruct may be constituted on the whole or a the person constituting it shall likewise result in
part of the fruits of the thing, in favor or one or the extinguishment of the usufruct. However,
even prior to the arrival of the period or prior to
more persons, simultaneously or successively,
the fulfillment of the resolutory condition, the
and in every case from or to a certain day,
usufruct is already extinguished upon the death
purely or conditionally. It may also be
of the usufructuary unless there is an express
constituted on a right, provided it is not strictly
agreement that the usufruct shall continue even
personal or intransmissible. (Art. 5464)
after such death.
Expiration of the period PARTIAL LOSS - If the thing given in usufruct

A usufruct granted for the time that may should be lost in part, the right shall continue
elapse before a third person attains a certain on the remaining part (Art 604, NCC)
age, shall subsist for the number of years • If the usufruct is constituted on immovable
specified, even if the third person should die property of which a building forms part, and
before the period expires, unless such
the latter should be destroyed in any manner
usufruct has been expressly granted only in
consideration of the existence of such person. whatsoever, the usufructuary shall have a
(Art 606, NCC) right to make use of the land and the
materials.
BAR QUESTION (1997) • This rule shall also apply if the usufruct is
On 1 January 1980, Minerva, the owner of a constituted on a building only and the same
building, granted Petronila a usufruct over the should be destroyed. But in such case, if the
property until 01 June 1998 when Manuel, a owner should wish to construct another
son of Petronila, would have reached his 30th building, he shall have the right to occupy
birthday. Manuel, however, died on 1 June the land and make use of the materials,
1990 when he was only 26 years old. Minerva being obliged to pay the usufructuary
notified Petronila that the usufruct had been during the continuance of the usufruct,
extinguished by the death of Manuel and the interest upon the sum equivalent to
demanded that the latter vacate the premises the value of the land and of the materials.
and deliver the same to the former. Petronila (Art 607, NCC, Lopez v Constantino, 74 Phil
refused to vacate the place on the ground that 160, Albar v Carandang, 106 Phil 855)
the usufruct in her favor would expire only on 1
June 1998, when Manuel would have reached Usufructuary is juridical person
his 30th birthday and that the death of Manuel • Usufruct cannot be constituted in favor of a
before his 30th birthday did not extinguish the town, corporation or association for more
usufruct. than 50 years.
• In case before the expiration of the period
Whose contention should be accepted? the town is abandoned, or the corporation or
SUGGESTED ANSWER association dissolved, the usufruct shall be
extinguished by reason thereof. (Art 605,
Petronila’s contention is correct. Under Article
606 of the Civil Code, a usufruct granted for the NCC)
time that may elapse before a third person
reaches a certain age shall subsist for the Expropriation
number of years specified even if the third Should the thing in usufruct be expropriated for
person should die unless there is an express public use, the owner shall be obliged either to
stipulation in the contract that states otherwise. replace it with another thing of the same value
and of similar conditions, or to pay the
In the case at bar, there is no express usufructuary the legal interest on the amount of
stipulation that the consideration for the the indemnity for the whole period of the
usufruct is the existence of Petronila’s son. usufruct. If the owner choose the latter
Thus, the general rule and not the exception alternative, he shall give security for the
should apply in this case payment of interest.
By the total loss of the thing in usufruct Bad Use

Building was razed by fire. Is there A usufruct is not extinguished by bad use of the
extinguishment of usufruct? thing in usufruct; but if the abuse should cause
considerable injury to the owner, the latter may
Answer: No, there is no extinguishment demand that the thing delivered to him, binding
because there is no total loss of the thing. himself to pay annually to the usufructuary the
Usufruct is constituted on both building and net proceeds of the same, after deducting the
land because the building cannot exist without expenses and the compensation which may be
the land. Usufructuary can use the materials allowed him for its administration. (Art 610,
and the land for the period of usufruct. NCC)
G. EASEMENTS d) An easement contemplates two (2)

estates belonging to two (2) different
EASTMENT OR SERVITUDE owners; a usufruct contemplates only
Although the terms servitude and easement one property (real or personal)
are sometimes used as synonyms, the two whereby the usufructuary uses and
concepts differ. A SERVITUDE relates to the enjoys the property as well as its fruits,
servient estate or the burdened land, while another owns the naked title
whereas an EASEMENT refers to the during the period of the usufruct.
dominant estate, which is the land benefited e) A usufruct may be alienated
by the right. separately from the property to which
it attaches, while an easement cannot
It is an encumbrance imposed upon an be alienated separately from the
immovable for the benefit of: property to which it attaches.
1. Another immovable belonging to a Parties to an Easement
different owner; or 1. Dominant estate – Refers to the immovable
2. A community or one or more persons to for which the easement was established.
whom the encumbered estate does not 2. Servient estate – The estate which provides
belong by virtue of which the owner is the service or benefit.
obliged to abstain from doing or to permit
a certain thing to be done on his estate 1. CHARACTERISTICS
(Arts. 613- 614, NCC) 1. It is a real right but will affect third persons
only when duly registered
BAR QUESTION (1995) 2. It is enjoyed over another immovable, never
What is Easement? Distinguish easement on one’s own property
from usufruct 3. It involves two neighboring estates (in case
of real easements)
SUGGESTED ANSWER
4. It is inseparable from the estate to which it is
• An EASEMENT or servitude is an attached, and, therefore, cannot be alienated
encumbrance imposed upon an independently of the estate
immovable for the benefit of another 5. It is indivisible for it is not affected by the
immovable belonging to a different owner. division of the estate between two or more
(Art. 613, NCC). persons
• USUFRUCT gives a right to enjoy the 6. It is a right limited by the needs of the
property of another with the obligation of dominant owner or estate, without
preserving its form and substance, unless possession
the title constituting it or the law otherwise
7. It cannot consist in the doing of an act
provides (Art. 562, NCC).
unless the act is accessory in relation to a
The distinctions between usufruct and real easement
easement are: 8. It is a limitation on the servient owner’s rights
a) Usufruct includes all uses of the of ownership for the benefit of the dominant
property and for all purposes, including owner; and, therefore, it is not presumed
jus fruendi. Easement is limited to a
specific use. 2. KINDS OF EASEMENTS
b) Usufruct may be constituted on 1. Beneficiary:
immovable or movable property. • Real – in favor of another immovable
Easement may be constituted only on • Personal – in favor of community or
an immovable property. persons to whom the encumbered estate
c) Easement is not extinguished by the do not belong.
death of the owner of the dominant 2. Source:
estate while usufruct is extinguished by • Legal – by law (either public use or
the death of the usufructuary unless a benefit of private persons)
contrary intention appears. • Voluntary – by agreement
DUTY TO 11. Intermediate distances [NCC 677-681]

EXISTENC
EXERCISE SERVIENT
E 12. Nuisance [NCC 682-683]
OWNER
CONTINUOUS APPARENT POSITIVE
use is incessant, those which impose upon Legal Easement Of Aqueduct
not dependent on are made the owner of This refers to easement regulated by Arts. 642
act of man known and the servient to 646 of the Civil Code. Any person who may
are estate the wish to use upon his estate any water of which
continually obligation of he can dispose shall have the right to make it
kept in view allowing flow through the intervening estates, but he must
by external something to
comply with the following requisites:
signs that be done or of
reveal the doing it 1. He must prove that he can dispose of the
use and himself. water and that it is sufficient for the use
enjoyment which it is intended
of the same. 2. He must show that the proposed right of way
DISCONTINUOUS NON NEGATIVE is the most convenient and least onerous to
those which are APPARENT prohibits the third persons;
used at intervals no external owner of the
3. He must indemnify the owner of the servient
and depend upon indication of servient estate
the acts of man existence from doing estate in the manner determined by laws and
something regulations;
which he could 4. He must secure a water right in accordance
lawfully do if with the formalities required by the Water
easement Code of the Philippines.
does not exist.
Legal easement Legal Easement of Drainage of Buildings

It is an easement established by law for public The easement of drainage of buildings refers to
use or for the interest of private persons. the legal easement regulated by Art 676 NCC
which declares that whenever the yard or a court
Voluntary easement of a house is surrounded by other houses, and it
• An easement is voluntary when it is is not possible to give an outlet though the
established by the will of the owners house itself to the rainwater collected thereon,
• Voluntary easements may be constituted by the establishment of an easement of drainage
the owner possessing capacity to encumber can be demanded, giving an outlet to the water
property. If there are various owners, all must at the point of the contiguous lands or tenements
consent; but consent once given is not where its egress may be easiest, and
revocable. establishing a conduit for the drainage in such
manner as to cause the least damage to the
How created: servient estate, after payment of proper
1. If created by title (contract, will, etc.), the title indemnity.
governs.
2. If acquired by prescription, it is governed by Distance in Planting Trees
the manner or form of possession The distances to be observed under Art 679 are:
• At least two meters from the dividing line of
Kinds of Legal Easements the estates if tall trees are planted
1. Natural drainage of water [NCC 637] • At least 50 cms if shrubs or small trees are
2. Riparian banks [NCC 638] planted.
3. Dam [NCC 639]
4. Drawing water and watering animals [NCC RIGHTS of adjacent owner in case of
640-641] violation
5. Aqueduct [NCC 642-646] • Demand that tree be uprooted.
6. Stop lock or sluice gate [NCC 647] • Branches extending even with distance
7. Right of way [NCC 649-657] complied, demand that they be cut off insofar
8. Party wall [NCC 658-666] as they spread over his estate
9. Light and view [NCC 667-681] • Cut-off himself the roots which penetrate into
10. Drainage of buildings [NCC 674] his land.
Right of Way a. Deed of recognition/ contract

b. By final judgment
• Who may demand the right of way? c. By apparent sign established by the
1. The owner of the dominant estate; or owner of two adjoining estates
2. Any person with the real right to
cultivate or use the dominant estate
e.g. a usufructuary, a de jure How Easement is acquired:
possessor. 1. If continuous and apparent
a. By title
• Rules for establishing right of way: b. By prescription—ten years
1. Estate is surrounded by other 2. If discontinuous and apparent—only by title
immovables without adequate access If continuous and non-apparent—only by
to public highway; title
2. Isolation is not due to the proprietor’s
3. If discontinuous and non-apparent—only by
own act;
3. Payment of proper indemnity; title
4. Must be established at the point least
prejudicial to the servient estate. Reckoning period prescription
Insofar as consistent with the first rule, a. Positive easement - The period is
where the distance from the dominant counted from the day when the owner of
estate to a public highway is shortest. the dominant estate begins to exercise it
b. Negative easement- From the day a
Extinguishment as Legal Easement of
notarial prohibition is made on the
Right of Way
servient estate
1. The owner has joined the dominant estate
to another abutting the public road.
2. A new road is opened giving access to the Easement of Light (Jus Luminum)
isolated estate. is the right to admit light from neighboring
*Extinguishment is not automatic. The owner estate by virtue of the opening of a window or
of the servient estate must ask for such the making of certain openings.
extinguishment.
Easement of View (Jus Prospectus)
Legal Easement of Drainage of Waters
is the right to make openings or windows to
Sometimes known as the natural easement of
water, is the legal easement regulated by Art. enjoy the view thru the estate of another and
637 of the Civil Code which declares that the power to prevent all constructions or works
lower estates are obliged to receive the waters which could obstruct such view or make the
which naturally and without intervention of same difficult.
man descend from the higher estates, as well
as the owner of the lower estate cannot Restrictions as to easement of views:
construct works which will impede the 1. Direct Views: the distance of 2 meters
easement; neither can the owner of the higher
between the wall and the boundary must be
estate make works which will increase the
observed.
burden.
2. Oblique Views: (walls perpendicular or at
Legal Easement of Lateral and Subjacent an angle to the boundary line) must not be
Support 60 cm to the nearest edge of the window.
the legal easement regulated by Art. 684-687
of the Civil Code which declares that no Prescription:
proprietor shall make excavations upon his Non-observance of the distances does not give
land as to deprive any adjacent land or
rise to prescription. (Art 670)
building of sufficient lateral or subjacent
support. Support is lateral when the
supported and the supporting land are divided Easement of Light & View:
by a vertical plane. It is subjacent when the 1. Opening if through dominant estate must
supported land is above and the supporting comply with required distance. 10 years from
land is beneath. service of notarial prohibition.
2. 10 years from opening if party wall, or 10
3. MODES OF ACQUIRING EASEMENT years from notarial prohibition if through wall
1. By Prescription of 10 years of dominant estate.
2. By title
Doctrine of Apparent sign 4. By the expiration of the term or the fulfillment

This refers to easement by presumption. The of the condition, if the easement is temporary
existence of apparent sign under Art. 624 is or conditional;
equivalent to a title. 5. By the renunciation of the owner of the
1. There must be apparent sign of easement dominant estate;
between two estates. 6. By the redemption agreed upon between the
2. Placed by the original owner of the two owners of the dominant and servient estates.
estates.
4. EFFECTS OF EASEMENTS
Upon the establishment of an easement, all the
rights necessary for its use are considered
granted (Art. 625, NCC)
1. Owner of the dominant estate may make, at
his own expense, on the servient estate any
works necessary for the use and
preservayion of the servitude but without
altering it or rendering it more burdensome.
(Art. 627) - for this purpose he shall notify the
owner of the servient estate and choose the
most convenient time and manner so as to
cause least inconvenience
2. Owner of the dominant estate cannot use the
easement except for the benefit of the
immovable originally contemplated; neither
can he exercise the easement in any manner
than that previously established (Art 626)
3. Owner of servient estate retains ownership
of the portion on which the easement is
established and he may use the same in
such a manner as not to affect the exercise
of the easement (Ar. 630)
4. Should there be several dominant estates,
the owners of all of them shall be obliged to
contribute to the expenses in proportion to
the benefits which each may derive from the
work. Anyone who does not wish to
contribute may exempt himself by
renouncing the easement for the benefit of
the others.
5. If the owner of the servient estate should
make use of the easement in any manner
whatsoever, he shall also be obliged to
contribute to the expenses in the proportion
stated, saving an agreement to the contrary.
(Art. 628)
5. EXTINGUISHMENT OF EASEMENTS
1. By merger in the same person of the
ownership of the dominant and servient
estates;
2. By non-user for ten years; with respect to
discontinuous easements, this period shall
be computed from the day on which they
ceased to be used; and, with respect to
continuous easements, from the day on
which an act contrary to the same took
place;
3. When either or both of the estates fall into
such condition that the easement cannot be
used;
III. DIFFERENT MODES OF ACQUIRING OWNERSHIP

A. Occupation D. Donation
B. Tradition E. Prescription
Art. 712. Ownership is acquired by occupation Things Susceptible of Occupation

and by intellectual creation. 1. Things that are without an owner – res nullius;
Ownership and other real rights over property abandoned (Art 719)
are acquired and transmitted by law, by NOTE: Stolen property cannot be subject of
donation, by estate and intestate succession, occupation
2. Animals that are the object of hunting and
and in consequence of certain contracts, by
fishing (Arts 715-717)
tradition. They may also be acquired by means
3. Hidden treasures (Art 718)
of prescription.
Specific Examples
Modes of Acquiring Ownership (OLD TIPS) 1. hunting and fishing
 O ccupation 2. finding of movables which do not have an
 L aw owner
 D onation 3. finding of abandoned movables
 T radition 4. finding of hidden treasure
 I ntellectual creation 5. catching of swarm of bees that has escaped
 P rescription from its owner, under certain conditions
 S uccession 6. catching of domesticated animals that have
escaped from their owners, under certain
A. OCCUPATION conditions
7. catching of pigeons without fraud or artifice
• is the acquisition of ownership by seizing 8. transfer of fish to another breeding place
corporeal thing that have no owner, made without fraud or artifice
with the intention of acquiring them, and
accomplished according to legal rules. Real property cannot be acquired by occupation
• “a mode of acquiring dominion by the Art. 714. The ownership of a piece of land cannot
seizure of corporeal things which have no be acquired by occupation
owner, with the intention of acquiring them,  Reason is that when the land is without an
owner, it pertains to the State.
and according to the rules laid down by
 It can be implied that by virtue of this
law.’’ (3 Sanchez Roman 210.)
provision, lands whether originally with an
• “the seizure of things corporeal which have
owner, belong to the State.
no owner with the intention of acquiring the
 An abandoned land (on with an owner before)
ownership thereof.’’ (1 De la Serna 589.) becomes patrimonial land of the State
susceptible of acquisition thru acquisitive
Art. 713. Things appropriable by nature which prescription.
are without an owner, such as animals that are
the object of hunting and fishing, hidden treasure BAR QUESTION (2007)
and abandoned movables, are acquired by
Occupation v. possession. (5%)
occupation.
SUGGESTED ANSWER
Requisites of Occupation • Occupation is a mode of acquiring ownership
1. There must be seizure of a thing, which involves some form of holding (Articles 712
2. Which must be a corporeal personal & 713, New Civil Code). Possession is the
property, holding of a thing or the enjoyment of a right.
3. Which must be susceptible of (Article 532, NCC).
appropriation by nature, • Occupation can take place only with respect to
property without an owner, while possession can
4. The thing must be without an owner, and
refer to all kinds of property, whether with or
5. There must be an intention to appropriate.
without an owner.
6. The requisites or conditions laid down by
• Occupation in itself, when proper, confers
law must be complied with. ownership; but possession does not by itself give
The rules for the acquisition of ownership by rise to ownership. (II Tolentino, Civil Code, 1992
occupation are contained in Articles 713 to 720 ed., p. 489).
B. TRADITION 3) Traditio longa manu which is made by

the grantor pointing out to the grantee
Tradition or Delivery
the thing to be delivered which must
• This mode transfers ownership as a
be within his sight (Art. 1499.);
consequence of certain contracts (like the
contract of sale, barter, assignment, simple
4) Tradition brevi manu which takes
loan or mutuum). place when the grantee is already in
• A perfected sale does not transmit ownership. possession of the thing under another
It is the delivery or tradition which conveys title as when a lessee buys the thing
ownership. leased to him (Ibid.); and
5) Tradition constitutum possessorium
Concept — Tradition is a derivative mode of which is similar to tradition brevi manu
acquiring ownership and other real rights by but in the opposite sense and that is
virtue of which, there being intention and when the owner alienates a thing but
capacity on the part of the grantor and grantee remains in possession in another
and the pre-existence of said rights in the estate concept as a lessee or depositary
of the grantor, they are transmitted to the (Art.1500.)
grantee through a just title. (3 Sanchez Roman c) Quasi tradition or delivery of incorporeal
238.) things or rights by the use by the grantee
of his rights with the grantor’s consent (Art.
Requisites of Tradition: 1501.); and
(a) Pre-existence in the estate of the grantor of d) Tradition by operation of law or delivery
the right to be transmitted;
which is not included in the foregoing
(b) Just cause or title for the transmission;
modes of delivery and where the delivery
(c) Intention on the part of the grantor to grant
is effected solely by virtue of an express
and on the part of the grantee to acquire;
provision of law. (see 2 Castan 208-209; 3
(d) Capacity to transmit and to acquire;
Sanchez Roman 209-210.)
(e) An act which gives it outward form,
physically, symbolically or legally. (Ibid. C. DONATION
234-235.)
Art. 725. Donation is an act of liberality whereby
Kinds of Tradition [De Leon]: a person disposes gratuitously of a thing or right
a) Real tradition or physical delivery which
in favor of another, who accepts it.
takes place when the thing is physically
delivered or transferred from hand to hand if 1. FEATURE OF DONATION
it is a movable, and if it is an immovable, by
certain acts also material, performed by the Requisites of Donation:
grantee in the presence of and with the
1. Donor must have Capacity to make the
consent of the grantor which acts are donation
generally called taking possession (see Art. 2. He must have donative Intent (animus
1497.) donandi)
b) Constructive tradition or when the delivery 3. There must be Delivery in certain cases
of the thing is not real or material but 4. Donee must Accept or consent to the
consists merely in certain facts indicative of donation during the lifetime of the donor
the same. This may take place in any of the
and of the donee in case of donation inter
following cases: vivos (Art. 746, NCC); whereas in case of
1) Symbolical tradition which is done
donation mortis causa, acceptance is
through the delivery of signs or things made after donor’s death because they
which represent that which is being partake of a will (Art. 728, NCC)
transmitted as, for Example, the keys or
the title itself (see Art. 1498.); Necessity of Acceptance
2) Tradition by public instrument which
Acceptance by the donee is required because
consists in the substitution of real
no one can be compelled to accept the
delivery of possession by a public
generosity of another.
writing with the delivery of a document
which evidences the transaction (Ibid.);
Who may be a donor Art. 739. The following donations shall be

• To be a donor, the law requires that a person void:
must be in possession of the capacity to (1) Those made between persons who were
contract and the capacity to dispose of his guilty of adultery or concubinage at the
property and is not specifically prohibited to
time of the donation;
make a donation.
(2) Those made between persons found
• Donations inter vivos are to a certain extent
guilty of the same criminal offense, in
contractual in nature, and are a mode by
consideration thereof;
which property is alienated or disposed of.
(3) Those made to a public officer or his
Hence, those who cannot give consent to a
contract cannot be donors; and donation
wife, descendants and ascendants, by
made by one who does not have the free reason of his office.
disposal of the thing donated and to alienate it In the case referred to in No. 1, the action for
shall not be valid. declaration of nullity may be brought by the
spouse of the donor or donee; and the guilt of
Who may be a donee the donor and donee may be proved by
• Generally, all persons, whether natural or preponderance of evidence in the same
artificial, may be donees. A donee need not action.
be sui juris, with complete legal capacity to
bind himself by contract. (see Arts. 38, 39.) As Art. 740. Incapacity to succeed by will shall be
long as he is “not specially disqualified by applicable to donations inter vivos.
law,’’ he may accept donations. Thus,
donations may be made to Incapacitated Art. 1027. The following are incapable of
persons such as minors and others who succeeding:
cannot enter into a contract (Art. 741.); so 1. The priest who heard the confession of
also to conceived and unborn children. (Art.
the testator during his last illness, or the
742.)
minister of the gospel who extended
• The law does not require that the donee must
spiritual aid to him during the same
possess capacity to act, which is defined as
period;
“the power to do acts with legal effect,” it
2. The relatives of such priest or minister of
being sufficient that he must possesses
juridical capacity or “the fitness to be the the gospel within the fourth degree, the
subject of legal relations.” So long as the church, order, chapter, community,
donee possesses juridical capacity and not organization, or institution to which such
specially disqualified by law, he may accept priest or minister may belong;
donations. 3. A guardian with respect to testamentary
dispositions given by a ward in his favor
Determination of Capacity before the final accounts of the
• Capacity of both donor and donee is guardianship have been approved, even
determined at the time of perfection of the if the testator should die after the
donation approval thereof; nevertheless, any
• Under this view, if the donor is capacitated at provision made by the ward in favor of
the time he makes the donation, his the guardian when the latter is his
subsequent incapacity does not affect the ascendant, descendant, brother, sister,
validity of the donation and, it will be perfected or spouse, shall be valid;
even though he is incapacitated at the time of 4. Any attesting witness to the execution of
acceptance
a will, the spouse, parents, or children,
or any one claiming under such witness,
Family Code – Art. 87. Every donation or grant
spouse, parents, or children;
of gratuitous advantage, direct or indirect,
5. Any physician, surgeon, nurse, health
between the spouses during the marriage shall
officer or druggist who took care of the
be void, except moderate gifts which the
spouses may give each other on the occasion of testator during his last illness;
any family rejoicing. The prohibition shall also 6. Individuals, associations and
apply to persons living together as husband and corporations not permitted by law to
wife without a valid marriage. inherit.
2. CLASSIFICATIONS INTER VIVOS MORTIS CAUSA
takes effect during the takes effect after the

From the viewpoint of motive, purpose, or
lifetime of the donor death of the donor
cause:
(1) simple — the cause is pure liberality (no must follow the
must follow the
strings attached) formalities of wills or
formalities of donations
• Example: A donates a parcel of land to B. codicils (holographic or
(if ordinary and simple)
notarial)
(FORM: that of donations).
(2) remuneratory (of the first kind) — can be revoked at any
time and for any
purpose: to reward past services, with no
reason while the donor
strings attached. (The services here do not is still alive (just as a
constitute recoverable debts.). will is essentially
• Ex. A donates a parcel of land to B, who cannot be revoked revocable). In other
had previously helped him review for the except for grounds words, this donation is
provided for by law revocable ad mutuum,
bar examinations. (This is the
i.e., at the discretion of
remuneratory donation referred to in Art. the grantor or the so-
726, “on account of the services rendered called “donor” simply
by him to the donor, provided they do not because he has
constitute a demandable debt’’). changed his mind.
• Ex. a donation to one who saved the In case the legitime is
donor’s life or to the heirs of a deceased impaired, donations
corporation manager who in life was in case of impairment of mortis causa (since
the legitime, donations they partake of the
greatly responsible for the corporation’s
inter vivos are preferred nature of, or are really,
success. to donations mortis legacies or devises)
• FORM: The form of donation should be causa (priority in time is are reduced ahead of
followed regardless of the true value of priority in right) donations inter vivos,
the past services compared to the value the latter being
of the donation.). preferred.
(3) remuneratory (of the second kind) (or the right of disposition is
the right of disposition
compensatory or in a sense, conditional) — completely transferred to
is not transferred to the
purpose: to reward future services or because the donee (although
donee while the donor
certain reservations as
of certain future charges or burdens, when the is still alive.
to usufruct, for example,
value of said services, burdens, or charges is may be made)
less than the value of the donation.
acceptance by donee
• Ex. A donates to B a parcel of land worth
mortis causa can only
P700,000 but B should give A a ring worth be done after the
P150,000 or teach him certain things, the acceptance by donee
donor’s death; any
must be during lifetime
value of the instruction being P90,000. prior acceptance is
of donor.
immaterial or void.
(There can as a rule be
3. DISTINCTIONS BETWEEN MORTIS
no contract relating to
CAUSA AND INTER VIVOS DONATIONS future inheritance.)
‘Mortis Causa Donation’ SOME INTER VIVOS DONATIONS

• Donations which are to take effect upon The following donations have been held to be
the death of the donor partake of the inter vivos:
nature of testamentary provisions a) A donation where the causes of revocation
have been specified. (Zapanta v. Posadas,
‘Inter Vivos Donations’ 52 Phil. 557).
• When the donor intends that the donation b) A donation where the donor reserved for
shall take effect during the lifetime of the himself a lifetime usufruct of the property,
donor, though the property shall not be for if he were still the owner, there would
delivered till after the donor’s death. (Art. be no need of said reservation. (Balaqui v.
729, NCC) Dongso, 53 Phil. 653).
c) A donation where the donor warrants the title General Rule: The fixing of an event or the
to the thing which he is donating (Balaqui v. imposition of a suspensive condition, which may
Dongso, 53 Phil. 653) — there would be no take place beyond the natural expectation of life
need of warranty were he not be transferring of the donor, does not destroy the nature of the
the title. act as a donation inter vivos.
d) Where the donor immediately transferred the XPN: unless a contrary intention appears. (Art.
ownership, possession and administration of 730, NCC)
the property to the donee, but stipulated that
BAR QUESTION (2011)
the right of the donee to harvest and alienate
the fruits would begin only after the donor’s X and Y were to marry in 3 months. Meantime,
death. (Guzman v. Ibea, O.G. June 16, 1941, to express his affection, X donated a house
p. 1834). (But if what had been transferred in and lot to Y, which donation X wrote in a letter
the meantime was only the administration of to Y. Y wrote back, accepting the donation and
the property, the donation is mortis causa.) took possession of the property. Before the
(Cariño v. Abaya, 70 Phil. 182). wedding however, Y suddenly died of heart
e) Where the donor stated that while he is alive attack.
he would not dispose of the property or take Can Y’s heirs get the property?
away the land “because I am reserving it to SUGGESTED ANSWER
him (the donee) upon my death.” (The Court
held this to be inter vivos because in effect, No. Since the donation and its acceptance are
he had already renounced the right to not in a public instrument.
dispose of his property). (See Cuevas v.
4. FORM
Cuevas, 51 O.G. 12, p. 6163).
Formalities for Donations of Real Property
f) A donation where the donees “should not as
(a) If the deed of donation and the acceptance
yet get the possession until our demise,” the
are in the same instrument:
administration remaining with the donor
1. The instrument must be a public
spouses, or either one surviving. (Guarin, et
document
al. v. De Vera, et al., L-8577, Feb. 28, 1957).
(b) If the deed of donation and the acceptance
are NOT in the same instrument:
SOME MORTIS CAUSA DONATIONS
1. The donation must be in a public
The following have been held to be mortis
instrument or document.
causa:
2. The document must specify the property
1) Where the donor has reserved (expressly
donated and the charges, if any.
or impliedly) the option to revoke the
Note: A donation which does not identify
donation at any time before death, even
the land donated is of no effect and is
without the consent of the donee. (Bautista
therefore void for absence of object.
v. Sabiniano, L-4236, Nov. 18, 1952).
3. The acceptance in a separate instrument
2) Where the donation will be void if the
must be in a public instrument.
transferee dies ahead of the transferor.
4. The donor shall be notified in authentic
(Heirs of Bonsato v. Court of Appeals, L-
form of the fact that acceptance is being
6600, July 30, 1954, 50 O.G. 3568).
made or has been made in a separate
3) If before the donor’s death, it is revocable
public instrument.
at his will. (Heirs of Bonsato v. Court of
5. The fact that there has been a
Appeals, supra).
notification must be noted in both
4) If the donor retains full or naked ownership
instruments.
and control over the property while he is
still alive. (Heirs of Bonsato v. Court of
Formalities for donation of personal property
Appeals, supra).
• Maybe made orally or in writing.
5) If what was in the meantime transferred to
• If value exceeds Php5,000, the donation &
the donee was merely the administration of
acceptance must be in writing
the property. (Cariño v. Abaya, 70 Phil.
• If value does not exceed Php5,000, the
182).
donation may be done orally provided there is
6) If title will pass only after donor’s death.
simultaneous delivery of the thing to the
(Howard v. Padilla, L-7064, 7098, Apr. 22,
donee who accepted the same. (Art 748)
1955).
5. LIMITATIONS SUGGESTED ANSWER

• As a mode of acquiring ownership, donation I will advise Jennifer that the deed of donation
results in an effective transfer of title over the executed in her favor by Josefa is a donation
property from the donor to the donee and is inter vivos. A donation mortis causa is
perfected from the moment the donor is made revocable during the lifetime of the donor. On
aware of the acceptance by the donee (Art. the other hand, an inter vivos donation once
accepted, is generally irrevocable. The law
734.), provided that the donee is not
further requires that if it involves immovable
disqualified or prohibited by law from property, it must be in a public document and
accepting the donation. (Art. 738.) there must be a deed of acceptance which
• Once the donation is accepted, it is generally must be in the same deed of donation. If the
considered irrevocable, and the donee acceptance is in a separate instrument, it has
becomes owner of the property, except on to be noted in both instruments (Article 749).
account of officiousness, failure of the donee
In the case presented, the deed of acceptance
to comply with the charge imposed on the
clearly signifies that it is a donation inter vivos
donation, or ingratitude. (Heirs of R. Florencio because a donation mortis causa need not be
v. Heirs T. De Leon, 425 SCRA 447 [2004].) accepted by the donee during the lifetime of the
• The effect of donation is to reduce the donor, in fact, it would be premature to accept
patrimony or asset of the donor and to a donation mortis causa if the donor is still
increase that of the donee. Hence, the giving alive.
of a mortgage or any other security does not
The fact that the donation made by Josefa was
constitute a donation.
irrevocable and that there is an acceptance
clause indicate that it is a donation inter vivos.
Limitations Imposed By Law in making Also, the prohibition on alienation during
Donations Inter Vivos Josefa’s lifetime all the more indicates that the
1. Donor must Reserve sufficient means for his donation is inter vivos because the fact that
support and for his relatives who are entitled Josefa reserved the lifetime usufruct of the land
shows that her intent is to transfer the
to be supported by him (Art. 750, NCC).
ownership of the donated property to Jennifer
2. Donation cannot comprehend Future or else there would have been no need for her
property except donations between future to reserve the lifetime usufruct if it were a
husband and wife (See Art. 84 FC). donation mortis causa.(Reyes vs. Mosqueda,
3. No person may give by way of donation 187 SCRA 661, 671 (1990); Concepcion vs.
More than he may give by will Concepcion, 91 Phil 823, 827 (1952)

Josefa executed a Deed of Donation covering a B donated to M a parcel of land in 1980. B
one hectare rice land in favor of her daughter, made the deed of donation, entitled “Donation
Jennifer. The deed specifically provides that: Inter Vivos,” in a public instrument and M
“For and in consideration of the love and accepted the donation in the same document.
It was provided in the deed that the land
service Jennifer has shown and given to me, I
donated shall be immediately delivered to M
hereby freely, voluntarily, and irrevocably and that M shall have the right to enjoy the
donate to her my one hectare rice land covered fruits fully. The deed also provided that B was
by TCT No. 11550, located in San Fernando, reserving the right to dispose of said land
Pampanga. This donation shall take effect during his (B’s) lifetime, and that M shall not
upon my death.” The deed also contained register the deed of donation until after B’s
Jennifer’s signed acceptance, and an attached death.
notarized declaration by Josefa and Jennifer
Upon B’s death, W, B’s widow and sole heir,
that the land will remain in Josefa’s possession filed an action for the recovery of the donated
and cannot be alienated, encumbered, sold or land, contending that the donation made by B
disposed of while Josefa is still alive. is a donation mortis causa and not a donation
inter vivos.
Advise Jennifer on whether the deed is a
donation inter vivos or mortis causa and Will said action prosper? Explain your
answer.
explain the reasons supporting your advice.
SUGGESTED ANSWER BAR QUESTION (1993)

Yes, the action will prosper. The donation is a On January 21, 1986, A executed a deed of
donation mortis causa because the reservation donation inter vivos of a parcel of land to
is to dispose of all the property donated and, Dr. B who had earlier constructed thereon
therefore, the donation is revocable at will. a building in which researches on the
Accordingly, the donation requires the dreaded disease AIDS were being
execution of a valid will, either notarial or conducted. The deed, acknowledged before
holographic (Arts 755, 728 NCC). a notary public, was handed over by A to Dr.
B who received it. A few days after, A flew to
BAR QUESTION (1990) Davao City. Unfortunately, the airplane he
Ernesto donated in a public instrument a parcel was riding crashed on landing killing him.
of land to Demetrio, who accepted it in the same Two days after the unfortunate accident. Dr.
document. It is there declared that the B, upon advice of a lawyer, executed a deed
donation shall take effect immediately, with acknowledged before a notary public
the donee having the right to take possession of accepting the donation.
the land and receive its fruits but not to dispose Is the donation effective? Explain your
of the land while Ernesto is alive as well as for answer.
ten years following his death. Moreover, Ernesto
also reserved in the same deed his right to sell SUGGESTED ANSWER
the property should he decide to dispose of it at No, the donation is not effective. The law
any time – a right which he did not exercise at requires that the separate acceptance of the
all. After his death, Ernesto’s heirs seasonably donee of an immovable must be done in a
brought an action to recover the property,
public document during the lifetime of the
alleging that the donation was void as it did not
donor (Art. 746 & 749, Civil Code) In this
comply with the formalities of a will. Will the
suit prosper?
case, B executed the deed of acceptance
before a notary public after the donor had
SUGGESTED ANSWER already died.
Yes, the suit will prosper as the donation did not
comply with the formalities of a will. In this 6. REDUCTION AND REVOCATION
instance, the fact that the donor did not
intend to transfer ownership or possession REVOCATION - This affects the whole
of the donated property to the donee until the donation and is allowed during the lifetime of
donor’s death, would result in a donation mortis the donor.
causa and in this kind of disposition, the
formalities of a will should be complied with,
otherwise, the donation is void. In this
INOFFICIOUS DONATION - A donation is
Instance, donation mortis causa embodied only inofficious or excessive when its amount
in a public instrument without the formalities of a impairs the legitimes of the compulsory
will could not have transferred ownership of heirs. Donations must be charged only
disputed property to another. against the disposable free portion. If its
amount exceeds the same, the excess is
One of the essential distinctions between a void for being inofficious.
donation inter vivos and a donation mortis causa
is that while the former is irrevocable, the latter
LEGITIME - is that part of the testator’s
is revocable. In the problem given, all the
clauses or conditions mentioned in the deed
property which he cannot dispose of
of donation, except one, are consistent with the because the law has reserved it for certain
rule of irrevocability and would have sustained heirs who are called compulsory heirs (Art
the view that the donation is inter vivos and 886)
therefore valid. The lone exception is the clause
which reserves the donor’s right to sell the COMPULSORY HEIRS – are those for
property at any time before his death. Such a whom the law has reserved a portion of the
reservation has been held to render the testator’s estate which is known as the
donation revocable and, therefore, becomes a
legitime.
donation mortis causa (Puig vs. Penqflorida, 15
SCRA 276, at p.286).That the right was not
• Primary – Legitimate children and legit
exercised is immaterial; its reservation was an descendants, surviving spouse,
implied recognition of the donor’s power to illegitimate children & descendants
nullify the donation anytime he wished to do so. • Secondary – Legitimate parents & other
Consequently, it should have been embodied in legitimate ascendants, Illegitimate
a last will and testament. The suit for nullity will parents
thus prosper.
REVOCATION REDUCTION SUGGESTED ANSWER
Failure of the donor to (a) No, it is a void donation. This is an ordinary

Birth, donation inter vivos, not a donation proper
reserve sufficient
appearance, or nuptias. The Civil Code provides that if the
means for support of value of the personal property donated
adoption of a
himself or dependent exceeds five thousand pesos, the donation and
child (Art. 760); the acceptance shall be made in writing;
relatives (Art. 750.);
otherwise, the donation shall be void. A piece
Non-fulfillment Failure of the donor to of jewelry like the family heirloom here which is
of condition reserve sufficient a gold ring, valued at P250,000.00, is a
personal property. Here, the acceptance was
imposed by the property to pay off his
made orally; therefore, the donation is void
donor (Art. existing debts (Art. (Article 748).
764.); 759.);
(b) No, because it is an ordinary donation, not
Inofficiousness, that is, a donation propter nuptias. The ground that the
Ingratitude of the donation exceeds marriage did not push through may only be
the donee. (Art. that which the donor raised to revoke donations by reason of
marriage which is defined by Article 126 of the
765) can give by will (Arts.
Family Code, as those which are made before
752, 771.); and its celebration, in consideration of the same
and in favor of one or both of the future
Birth, appearance, or
spouses (Art. 83, FC). Here, the donation was
adoption of a child. (Art. not made in favor of one or both of the future
760.) spouses, but in favor of their child. X’s parents,
therefore, cannot revoke the donation on the
Art. 765. The donation may also be revoked ground that the marriage of X with Y did not
at the instance of the donor, by reason of push through.
ingratitude in the following cases:
(1) If the donee should commit some offense D. PRESCRIPTION
against the person, the honor or the
property of the donor, or of his wife or By PRESCRIPTION one acquires ownership
and other real rights through the lapse of time in
children under his parental authority;
the manner and under the conditions laid down
(2) If the donee imputes to the donor any by law. In the same way, right and actions are
criminal offense, or any act involving moral lost by prescription. (Art. 1106, NCC)
turpitude, even though he should prove it,
unless the crime or the act has been Kinds of prescription:
committed against the donee himself, his 1. Acquisitive prescription - one acquires
wife or children under his authority; ownership and other real rights through the
lapse of time in the manner and under the
(3) If he unduly refuses him support when the
conditions laid down by law.
donee is legally or morally bound to give a. Ordinary acquisitive prescription:
support to the donor. requires possession of things in good faith
BAR QUESTION (2019) and with just title for the time fixed by law
b. Extraordinary acquisitive prescription:
X and Y were in a live-in relationship for the acquisition of ownership and other real
longest time, and were already blessed with a rights without need of title or of good faith
child, Z. They finally decided to get married on or any other condition.
March 15, 2020, When X’s parents found about
the news, they were thrilled and thus, donated 2. Extinctive prescription - rights and actions
in favor of Z, the family heirloom, particularly, a are lost through the lapse of time in the manner
gold ring valued at P250,000.00 which X and Y and under the conditions laid down by law.
orally accepted on behalf of their minor child.
One day, X and Y got into a serious quarrel, REQUISITES OF ORDINARY ACQUISITIVE
which resulted in them setting aside their PRESCRIPTION:
marriage plans. 1. Capacity to acquire by prescription
(a) Is the donation to Z valid? Explain. (3%) 2. The object must be susceptible of
(b) Assuming that the donation to Z is valid, prescription
may X’s parents revoke the donation on 3. The possession must be in the concept of
the ground that the marriage of X with Y the owner, public, peaceful, continuous,
did not push through? Explain. (3%) and uninterrupted.
4. The possession must be in good faith. Prescription of Ownership and other Real
5. The possession must be by virtue of a just Rights
title; and Article 1126. Against a title recorded in the
6. The period of possession must be four Registry of Property, ordinary prescription of
years if object is movable, or 10 years if it ownership or real rights shall not take place to
is immovable. the prejudice of a third person, except in virtue of
another title also recorded; and the time shall
REQUISITES OF EXTRAORDINARY begin to run from the recording of the latter.
ACQUISITIVE PRESCRIPTION:
1. Capacity to acquire by prescription. As to lands registered under the Land
2. The object must be susceptible of Registration Act, the provisions of that special
prescription. law shall govern.
3. The possession must be in the concept of
the owner, public, peaceful, continuous, A title once registered under the torrens
and uninterrupted; and, system cannot be defeated even by adverse,
4. The period of possession must be 8 years open and notorious possession; neither can
if object is movable, or 30 years if it is it be defeated by prescription. It is notice to
immovable. the whole world and as such all persons are
bound by it and no one can plead ignorance
1. DISTINCTION BETWEEN ACQUISITIVE of the registration. [Doronio vs. Heirs of
AND EXTINCTIVE PRESCRIPTION Fortunato Doronio, G.R. No. 169454;
December 27, 2007]
ACQUISITIVE EXTINCTIVE
PRESCRIPTION PRESCRIPTION Prescription of Actions
CONCEPT – Prescription of action/ limitation of
relationship between one does not look to action is the time within which an action may be
the occupant and the act of the brought or some act done to preserve the right.
the land in terms of possessor but to the HOW ACTIONS PRESCRIBE - As provided in
possession is neglect of the owner Article 1139, actions prescribe by mere lapse of
capable of time fixed by law. This is extinctive prescription
producing legal referred to in the second paragraph of Article
consequences; it is 1106
the possessor who
is the actor Period of Prescription
Movables
requires possession requires inaction of • Good Faith - 4 years
by a claimant who is the owner or neglect • Bad Faith - 8 years
not the owner of one with a right to
bring his action Immovables
• Good Faith - 10 years
applicable to applies to all kinds of • Bad Faith - 30 years
ownership and other rights, whether real or
real rights personal Life time
1. Action for annulment of marriage based on
vests ownership or produces the insanity (Art 47 FC)
other real rights in extinction of rights or 2. Action to claim legitimacy (Art 173 FC)
the occupant bars a right of action 3. Action to compel acknowledgement of
illegitimate child (Art 175 FC)
results in the results in the loss of a
acquisition of real or personal right, 30 years
ownership or other or bars the cause of - action for recovery of immovables from time
real rights in a action to enforce said possession is lost if possessor is in bad faith (Art
person as well as right 1141 NCC)
the loss of said
ownership or real 10 years
rights in another 1. action for recovery of immovables from time
possession is lost if possessor is in good
can be proven under should be
faith (Art 1141 NCC)
the general issue affirmatively pleaded
2. action upon a mortgage contract
without its being and proved to bar the
3. action upon a written contract
affirmatively pleaded action or claim of the 4. action upon an obligation created by law
adverse party 5. action upon a judgement
8 years 6 months
action to recover movables from time possession 1. Action for reduction of price or for rescission in
is lost if possessor is in bad faith (Arts 1132, 1140 case of breach of sale of real estate either with
NCC)
a statement of its area at a certain price for a
6 years unit of measure or number (Arts 1543, 1539
1. action upon an oral contract (Art 1145 NCC) NCC) or for lump sum (Arts 1543, 1542 NCC)
2. action upon a quasi-contract (Art 1146 NCC) 2. Action for warranty against hidden defects of
thing sold (Art 1571 NCC)
5 years
1. Action to claim legitimacy if child should die 40 days
during minority or insanity (Art 173 FC)
- Redhibitory action based on defects of animals
2. Action for declaration of incapacity of heir (Art
1040 NCC) (Art 1577 NCC)
3. Action for warranty of solvency of debtor if
credit is assigned to a co-heir during partition Interruption of Prescription of Actions
(Art 1095 NCC) Art. 1154. The period during which the obligee
4. All other actions where periods are not fixed was prevented by a fortuitous event from
by law (Art 1149 NCC)
enforcing his right is not reckoned against him.
5. Action for annulment of marriage based on
lack of parental consent, fraud, force or The prescription of actions is interrupted
intimidation, impotency, sexually 1. When they are filed before the court;
transmissible disease (Art 47 FC) 2. When there is a written extrajudicial demand
6. Action for legal separation (Art 55 FC) by the creditors;
7. Action to claim acknowledgement if 3. When there is any written acknowledgement of
illegitimate child died during minority or the debt by the debtor (Art 1155 NCC)
insanity (Art 175 FC)
4 years Persons against whom Prescription does not

1. Action for revocation or reduction of donation run:
based on supervening birth, appearance or 1. Against minors and other incapacitated
adoption of child (Art 763 NCC) persons who have no parents, guardians or
2. Action for revocation of donation based on other legal representatives
nonfulfillment of condition (Art 764 NCC) 2. Against absentees who have no
3. Action for recovery of movable if possessor is
administrators
in good faith (Art 1132)
4. Action upon a quasi-delict (Art 1146 NCC) 3. Against persons living abroad who have no
5. Action for rescission of rescissible contracts managers or administrators
(Art 1389 NCC) 4. Against the State and its subdivision except
6. Action for annulment of voidable contracts as regards patrimonial property
(Art 1391 NCC) 5. Between husband and wife, even though
there be separation of property agreed upon
3 years
- Action to impugn legitimacy if husband is in the marriage settlements or by judicial
abroad (Art 170 FC) decree.
6. Between parents and children, during the
2 years minority or insanity of the latter
- Action to impugn legitimacy if husband is in the 7. Between guardian and ward during the
Philippines but not residing in the same place of continuance of the guardianship
birth or registration (Art 170 FC)
8. Between co-owners/ co-heirs (Art 494)
1 year BAR QUESTION (2011)
1. Action by husband to impugn child’s
legitimacy if he is residing in the same place In 1955, Ramon and his sister Rosario inherited a
parcel of land in Albay from their parents. Since
where birth took place or is recorded (Art 170
Rosario was gainfully employed in Manila, she
FC)
left Ramon alone to possess and cultivate the
2. Action for revocation of donation for acts of
land. However, Ramon never shared the
ingratitude (Art 769 NCC)
harvest with Rosario and was even able to sell
3. Action for forcible entry and unlawful detainer
one-half of the land in 1985 by claiming to be the
(Art 1147 NCC) sole heir of his parents. Having reached
4. Action for defamation (Art 1147 NCC) retirement age in 1990 Rosario returned to the
5. Action for rescission or damages if province and upon learning what had transpired,
immovable sold is encumbered with demanded that the remaining half of the land be
nonapparent burden or servitude (Art 1560 given to her as her share.
NCC)
CONT. 2. DISTINCTIONS BETWEEN EXTINCTIVE

Ramon opposed, asserting that he has already PRESCRIPTION AND LACHES
acquired ownership of the land by prescription,
and that Rosario is barred by laches from Laches
demanding partition and reconveyance. "There is laches when a party was negligent or
Decide the conflicting claims. has failed "to assert a right within a reasonable
time," thus giving rise to the presumption that he
SUGGESTED ANSWER or she has abandoned it. Laches has set in
when it is already inequitable or unfair to allow
Ramon is wrong on both counts: prescription
the party to assert the right (Sps. Aboitiz v. Sps.
and laches. His possession as co-owner did
Po (G.R. No. 208450 and 208497, June 5, 2017)
not give rise to acquisitive prescription.
Possession by a co-owner is deemed not
Elements of Laches
adverse to the other co-owners but is, on the
(1) the conduct of the defendant or one under
contrary, deemed beneficial to them (Pongon v.
whom he claims, gave rise to the situation
GA, 166 SCRA 375). Ramon’s possession will
complained of;
become adverse only when he has repudiated
(2) here was delay in asserting a right after
the co-ownership and such repudiation was
knowledge of the defendant's conduct and
made known to Rosario. Assuming that the
after an opportunity to sue;
sale in 1985 where Ramon claimed he was the
(3) defendant had no knowledge or notice that
sole heir of his parents amounted to a
the complainant would assert his right;
repudiation of the co-ownership, the
(4) here is injury or prejudice to the defendant in
prescriptive period began to run only from that
the event relief is accorded to the
time. Not more than 30 years having lapsed
complainant.
since then, the claim of Rosario has not as yet
prescribed. The claim of laches is not also
Defense of Laches
meritorious. Until the repudiation of the co-
• based on equity.
ownership was made known to the other co-
• It is not based on the title of the party invoking
owners, no right has been violated for the said
it, but on the right holder's "long inaction or
co-owners to vindicate. Mere delay in
inexcusable neglect" to assert his claim.
vindicating the right, standing alone, does not
constitute laches.
Laches v. Prescription
Laches is different from the statute of limitations.
BAR QUESTION (2011)
Prescription is concerned with the fact of delay,
Senen and Peter are brothers. Senen migrated whereas laches is concerned with the effect of
to Canada early while still a teenager. Peter delay. Prescription is a matter of time; laches is
stayed in Bulacan to take care of their widowed principally a question of inequity of permitting a
mother and continued to work on the Family claim to be enforced, this inequity being founded
farm even after her death. Returning to the on some change in the condition of the property
country some thirty years after he had left, or the relation of the parties. Prescription is
Senen seeks a partition of the farm to get his statutory; laches is not. Laches applies in equity,
share as the only co-heir of Peter. Peter whereas prescription applies at law. Prescription
interposes his opposition, contending that is based on fixed time laches is not. (Simeon
acquisitive prescription has already set in and Miguel et al v. Catalino, G.R. No. L-23072
that estoppel lies to bar the action for partition, November 29, 1968)
citing his continuous possession of the property
for at least 10 years, for almost 30 years in fact. HEIRS BAGAYGAY v. HEIRS PACIENTE
It is undisputed that Peter has never openly G.R. No. 212126, August 04, 2021
claimed sole ownership of the property. If he J. Hernando
ever had the intention to do so, Senen was Ruling:
completely ignorant of it. • Laches does not apply to void ab initio
Will Senen’s action prosper? Explain. contracts.
• Likewise without merit petitioners' defense of
SUGGESTED ANSWER laches. In the Heirs of Alido v. Campano, the
Senen’s action will prosper. Article 494 of the Court made it clear that laches do not apply to
New Civil Code provides that “no prescription void ab initio contracts. It explained –
shall run in favor of a co-owner or co-heir • Laches, however, do not apply if the assailed
against his co-owners or co-heirs so long as he contract is void ab initio. In Heirs of Ingjug-
expressly or impliedly recognizes the co- Tiro v. Spouses Casals, the Court expounded
ownership. Peter has never openly claimed that laches cannot prevail over the law that
sole ownership of the property nor had he actions to assail a void contract are
notified Senen of his having repudiated the co- imprescriptible it being based on equity, to
ownership.. wit:
• In actions for reconveyance of property

predicated on the fact that the conveyance
complained of was null and void ab initio, a
claim of prescription of action would be
unavailing. "The action or defense for the
declaration of the inexistence of a contract
does not prescribe." Neither could laches be
invoked in the case at bar. Laches is a
doctrine in equity and our courts are basically
courts of law and not courts of equity. Equity,
which has been aptly described as "justice
outside legality," should be applied only in the
absence of, and never against, statutory law.
IV. LAND TITLES AND DEEDS

A. Torrens System
B. Regalian Doctrine F. Certificate of Title
C. Nationality Restrictions on Land Ownership G. Subsequent Registration
D. Original Registratiion (PD 1529) H. Non-Registrable Properties
E. An Act Improving the Confirmation Process I. Dealings With Unregistered Lands
for Imperfect Land Titles (RA 11573), J. Assurance Fund
amending CA 141 and PD 1529 [See K. Reconstitution of Title
Republic v. Pasig Rizal Co., Inc., G.R. No.
213207, February 15, 2022]
A. TORRENS SYSTEM 1. GENERAL PRINCIPLES
 Is a system for registration of land under ‘Register’ Defined

which, upon the landowner’s application, It may refer to:
the court may, after appropriate (a) the act of recording or annotating
proceedings, direct the issuance of a (b) the book of registry
certificate of title. It is a system of (c) the office concerned
registration by which title recorded become (d) the official concerned
absolute, indefeasible and imprescriptible.
Rights acquired under this system are Purposes of Registration and Publicity
guaranteed by the government which (a) to give true notice of the true status of real
provides an assurance fund to answer for property and real rights thereto;
damages to be suffered by persons thru (b) to prejudice third persons (unless they have
the operation of this system. actual knowledge of the transaction
 The primary and fundamental purpose of concerned) (Art. 709; Tuason v. Reyes, 48
the torrens system is to quiet title. If the Phil. 844);
holder of a certificate cannot rest secure in (c) to record acts or contracts (transmissions
this registered title then the purpose of the and modifications of ownership and other
law is defeated. If those dealing with real rights over real properties) (Art. 708);
registered land cannot rely upon the (d) to prevent the commission of frauds, thus
certificate, then nothing has been gained insuring the effectivity of real rights over real
by the registration and the expense property.
incurred thereby has been in vain. If the
holder may lose a strip of his registered Note: Registration is not a mode of acquiring
land by the method adopted in the present ownership.
case, he may lose it all. (Legarda vs.
Saleeby , G.R. No. L-8936 | October 2, Effect of Non-Registrations
1915) The titles of ownership, or other rights over
immovable property, which are not duly
Nature of the Torrens System inscribed or annotated in the Registry of
• The Torrens system in the Philippines is Property shall not prejudice third persons. (Art.
judicial in character and not merely 709, NCC)
administrative in nature. “Judicial
proceedings for the registration of land Effect of Non-Registration on the Immediate
throughout the Philippines shall be in rem Parties to a Transaction
and shall be based on the generally • As between the parties to a sale,
accepted principles underlying the Torrens registration is not necessary to make it
system (Sec. 2, P.D. 1529) valid and effective, for such notice is
equivalent to registration.
Protection given to the Torrens Certificate of • To hold otherwise would make the Torrens
Title to Land System a shield for the commission of
Holders are entitled to protections under: fraud by the vendor or his heirs who would
(1) The Property Registration Decree; and/ or then be able to reconvey the property to
(2) The Civil Code of the Philippines. other persons.
• Indeed, registration is intended to protect • The Regalian doctrine extends not only
the buyer against claims of third persons to land but also to all natural wealth that
arising from subsequent alienations by the
may be found in the bowels of the earth.
vendor, and is certainly not necessary to
give effect as between the parties to the
contract. (Manuel v. PNB, L-9664, July 31, Regalian Doctrine Enshrine In
1957; Monge v. Angeles, L-9558, May 24, Philippine Laws and Constitution (Sec
1957; Galanza v. Nuesa, 50 O.G. 4213). 2, 1987 Constitution)
“All lands of the public domain, waters,
‘Public’ Nature of the Books (Art. 710, NCC) minerals, coal, petroleum, and other
• Public is a comprehensive, all-inclusive mineral oils, all forces of potential energy,
term, and properly construed, it may
fisheries, forests or timber, wildlife, flora
embrace every person (even those without
and fauna, and other natural resources are
a pecuniary or financial interest) as long as
it is clear that the purpose of the owned by the State. With the exception of
examination is not unlawful or arises from agricultural lands, all other natural
sheer, idle curiosity. resources shall not be alienated. The
• Thus, an editor of a newspaper may exploration, development, and utilization of
examine the records of the Registry for the natural resources shall be under the full
purpose of ascertaining the real estates control and supervision of the State. The
that have been sold to aliens. (Subido v.
State may directly undertake such
Ozaeta and Villanueva, supra).
activities, or it may enter into co-
B. REGALIAN DOCTRINE production, joint venture, or production-
sharing agreements with Filipino citizens,
• Private title to land must be traced to some
or corporations or associations at least
grant, express or implied, from the Spanish
sixty per centum of whose capital is owned
Crown or its successors, the American
Colonial Government, and thereafter, the by such citizens. Such agreements may be
Philippine Republic for a period not exceeding twenty-five
• In a broad sense, the term refers to royal years, renewable for not more than twenty-
rights, or those rights to which the King has five years, and under such terms and
by virtue of his prerogatives conditions as may be provided by law. In
• In Spanish law, it refers to a right which the cases of water rights for irrigation, water
sovereign has over anything in which a
supply fisheries, or industrial uses other
subject has a right of property or propriedad.
These were rights enjoyed during feudal
than the development of water power,
times by the King as the sovereign. beneficial use may be the measure and
• The theory of jure regalia was therefore limit of the grant.”
nothing more than a natural fruit of conquest
• All lands of the public domain belong to the Except
State, which is the source of any asserted The agricultural lands of public domain
right to ownership of land.
which alone may be alienated, forest or
• All lands not appearing to be clearly within
timber, and mineral lands, as well as all
private ownership are presumed to belong to
the State.
other natural resources must remain with
the State, the exploration, development
General Rule: it remains part of the inalienable and utilization of which shall be subject to
public domain. its full control and supervision albeit
XPN: Unless public land is shown to have been allowing it to enter into co-production, joint
reclassified or alienated to a private person by venture or production-sharing agreements,
the State
or into agreements with foreign-owned
• To overcome this presumption,
corporations involving technical or financial
incontrovertible evidence must be established
that the land subject of the application is assistance for large-scale exploration,
alienable or disposable. development, and utilization.
What is needed to declassify a forest land XPN:

into alienable or disposable land for  Condominiums: Foreigners are allowed
agricultural or other purposes? to own condominium units, provided
A positive act of the government is needed to
that the foreign ownership does not
declassify a forest land into alienable or
exceed 40% of the total units in the
disposable land for agricultural or other
condominium project.
purposes. Absent any positive act of the
 Long-term Lease: Foreigners can enter
government to classify a land of public domain
into long-term lease agreements for
into alienable or disposable land for
residential or commercial properties for
agricultural or other purposes, it remains with
the State. (FCBPFAI v. DENR and DAR | G.R. an initial period of up to 50 years,
No. 247866 | September 15, 2020) renewable for another 25 years.
 Foreigners cannot acquire lands except
Explanation on Classification of Land through hereditary succession
classification of land which may be classified (intestate not by will);
as alienable and disposable under the 1987 - i.e. the default laws on inheritance
Philippine Constitution, may still be reserved which are not transfers of ownership by
for public or quasi-public purposes which way of a last will and testament.
would prohibit the alienation or disposition of  Former Filipino Citizens: Foreigners
such land. xxx Thus, to be alienable and who were former Filipino citizens can
disposable, lands of the public domain must acquire land up to a maximum area of
be expressly declared as alienable and 5,000 square meters for residential
disposable by executive or administrative purposes and 3 hectares for business
proclamation pursuant to law or by an Act of or commercial purposes.
Congress. (In Re: Application for Land
Registration, Dumo vs. Republic, G.R. No. Simundac-Keppel vs. Keppel | G.R. No.
218269, June 06, 2018) 202039, August 14, 2019
Ruling:
Bureau of Forestry v. CA
• Section 7, Article XII of the 1987
153 SCRA 351 (1987)
Constitution states that: "Save in cases of
As provided for under Sec. 6 of CA 141, which
hereditary succession, no private lands
was lifted from Act 2874, the classification or
shall be transferred or conveyed except to
reclassification of public lands into alienable or
individuals, corporations, or associations
disposable, mineral, or forest lands is now a
prerogative of the Executive Department of qualified to acquire or hold lands of the
the government and not the courts. With these public domain." It seems clear, however,
rules, there should be no more room for doubt that the lower courts were too quick to
that it is not the court which determines the pronounce that Georg, being a German
classification of lands of the public domain into citizen, was automatically disqualified
agricultural, forest or mineral but the Executive from owning lands in the Philippines.
Branch of the government, through the Office • At best, an alien could have enjoyed a
of the President. limited right to own lands. Section 8,
Article XII of the Constitution provides:
C. NATIONALITY RESTRICTION
"Notwithstanding the provisions of Section
GR: 7 of this Article, a natural-born citizen of
 Filipino citizens, whether residing in the the Philippines who has lost his Philippine
Philippines or abroad, are generally Citizenship may be a transferee of private
entitled to own land in the country. lands, subject to limitations provided by
 Corporations or Associations at least
law." Section 5 of Republic Act No. 8179
60% Filipino-Owned: Corporations or
associations at least 60% owned by (An Act Amending the Foreign
Filipino citizens are also eligible to Investments Act of 1991) also states:
acquire and hold land, subject to
certain limitations.
• Sec. 10. Other Rights of Natural Born Citizen 6. Service of notice upon contiguous owners,
Pursuant to the Provisions of Article XII, occupants and those known to have
Section 8 of the Constitution. - Any natural interests in the property by the sheriff.
born citizen who has lost his Philippine 7. Filing of answer to the application by any
citizenship and who has the legal capacity to person whether named in the notice or not;
enter into a contract under Philippine laws 8. Hearing of the case by the Court;
may be a transferee of a private land up to a 9. Promulgation of judgment by the Court;
maximum area of five thousand (5,000) 10. Issuance of the decree by the Court
square meters in the case of urban land or declaring the decision final and instructing
three (3) hectares in the case of rural land to the Land Registration Authority to issue a
be used by him for business or other decree of confirmation and registration;
purposes. 11. Entry of the decree of registration in the
• In the case of married couples, one of them Land Registration Authority;
may avail of the privilege herein granted: 12. Sending of copy of the decree of
Provided, That if both shall avail of the same, registration to the corresponding Register of
the total area acquired shall not exceed the Deeds; and
maximum herein fixed. 13. Transcription of the decree of registration in
• In case the transferee already owns urban or the registration book and issuance of the
rural land for business or other purposes, he owner’s duplicate original certificate of title
shall still be entitled to be a transferee of to the applicant by the Register of Deeds,
additional urban or rural land for business or upon payment of the prescribed fees.
other purposes which when added to those
already owned by him shall not exceed the 1. WHO MAY APPLY
maximum areas herein authorized. RA 11573. Sec. 6 amending Sec. 14 of PD
• A transferee under this Act may acquire not 1529
more than two (2) lots which should be The following persons may file in the proper
situated in different municipalities or cities Court of First Instance an application for
anywhere in the Philippines: Provided, That registration of title to land, whether personally or
the total land area thereof shall not exceed through their duly authorized representatives:
five thousand (5,000) square meters in the 1) Those who by themselves or through their
case of urban land or three (3) hectares in the predecessors-in-interest have been in
case of rural land for use by him for business open, continuous, exclusive and notorious
or other purposes. A transferee who has possession and occupation of alienable
already acquired urban land shall be and disposable lands of the public domain
disqualified from acquiring rural land area and not covered by existing certificates of title
vice versa. or patents under a bona fide claim of
D. ORIGINAL REGISTRATION ownership for at least twenty (20) years
immediately preceding the filing of the
(PD 1529)
application for confirmation of title except
Requisites in ordinary land registration when prevented by war or force majeure.
proceedings: They shall be conclusively presumed to
1. Survey of land by the Bureau of Lands or a have performed all the conditions
duly licensed private surveyor; essential to a Government grant and
2. Filing of application for registration by the shall be entitled to a certificate of title
applicant; under this section.
3. Setting of the date for the initial hearing of the Note: Possession must be:
application by the Court;  Open – apparent
4. Transmittal of the application and the date of  Continuous – uninterrupted and not
initial hearing with all the documents or other occasional
evidences attached thereto by the Clerk of  Exclusive – dominion over the land
Court to the Land Registration Commission  Notorious – must be generally known
(now Land Registration Authority); 2) Those who have acquired ownership of
5. Publication of a notice of the filing of the private lands or abandoned riverbeds by
application and date and place of the hearing right of accession or accretion under the
in the Official Gazette; provisions of existing laws.
General Rule: River beds which are 3. PREVIEW OF DECREE OF

abandoned through the natural change in REGISTRATION; INNOCENT
the course of waters ipso facto belong to PURCHASER FOR VALUE (IPV); RIGHTS
the owners whose lands are occupied by OF IPV
the new course in proportion to the area
lost. General Rule: After the expiration of one (1)
Exception: The owners of the adjoining year from the issuance of the decree of
lands shall have the right to acquire the registration, the certificate of title serves as
same by paying the value thereof, evidence of an indefeasible title to the
otherwise, the alluvial property may be property in favor if the person whose name
subject to acquisition through prescription appears thereon.
by third persons.
3) Those who have acquired ownership of Innocent Purchaser for Value
land in any other manner provided for by • One who buys property and pays a full
law. and fair price for it, at the time of the
• Where the land is owned in common, all the purchase or before any notice of some
co-owners shall file the application jointly.
other person’s claim on interest to it.
• Where the land has been sold under pacto
(Francisco H. Lu v. Sps Manipon | G.R.
de retro, the vendor a retro may file an
No. 147072 | May 7, 2002)
application for the original registration of the
• An “innocent purchaser for value’’ is
land: Provided, however, That should the
deemed, under the Torrens system, to
period for redemption expire during the
include an innocent lessee, mortgagee or
pendency of the registration proceedings
other encumbrances for value.
and ownership to the property consolidated
in the vendee a retro, the latter shall be
Elements of an innocent purchaser for
substituted for the applicant and may
value:
continue the proceedings.
1. One who buys property and pays a full and
• A trustee on behalf of his principal may
fair price for it; and
apply for original registration of any land held
• A purchaser who acquires real property
in trust by him, unless prohibited by the
at less than the fair market value should
instrument creating the trust.
be wary of any defect in title. While
generally, purchase at less than the fair
2. DECREE OF REGISTRATION
market value is allowed by law, if
Secs. 39-42 of PD 1529
circumstances exist that call for the
1. The Court shall issue an order directing the
cancellation of the sale due to the void
Commissioner to issue the corresponding
nature of the transaction; then the sale
decree of registration and certificate of title.
may be nullified. (Sps. Cusi v. Domingo |
2. The Commissioner shall cause to be
prepared the decree of registration as well
G.R. No. 195825 | February 27, 2013)
as the original and duplicate of the
corresponding original certificate of title. 2. Purchases property before any notice of
3. The Original Certificate of Title shall be sent, some other person’s interest.
together with the owner’s duplicate • A purchaser cannot close his eyes to
certificate, to the Register of Deeds of the facts which should put a reasonable man
city or province where the property is upon his guard, and then claim that he
situated for entry in his registration book. acted in good faith under the belief that
4. The Original Certificate if Title shall be there was no defect in the title of the
entered in the record book and shall be vendor. He must further show that he
numbered, dated, signed and sealed by the exercised reasonable precaution by
Register of Deeds with the seal of his office. inquiring beyond the certificates of title.
5. The owner’s duplicate Certificate of Title Failure to exercise such, rendered him a
shall be delivered to the registered owner or buyer in bad faith. (Uy v. Fule | G.R. No.
to his duly authorized representative. 164961 | June 30, 2014)
E. AN ACT IMPROVING THE Should there be no available copy of the

CONFIRMATION PROCESS FOR Forestry Administrative Order, Executive
IMPERFECT LAND TITLES (RA Order or Proclamation, it is sufficient that the
11573), AMENDING CA 141 AND Lad Classification (LC) Map Number, Project
PD 1529 Number, and date of release indicated in the
[SEE REPUBLIC V. PASIG RIZAL land classification map be stated in the
CO., INC., G.R. NO. 213207, sworn statement declaring that said land
FEBRUARY 15, 2022] classification map is existing in the inventory
of LC Map records of the National Mapping
What's new in RA 11573? and Resource Information Authority
• It simplifies the procedure and (NAMRIA) and is being used by the DENR
requirements in granting land titles. as land classification map.
• The deadline for agricultural free patent
applications has been removed; and REPUBLIC V. PASIG RIZAL CO., INC.
shortened the required period of (PRCI)| G.R. NO. 213207, FEBRUARY 15,
possession for confirmation of imperfect 2022
titles to 20 years.  The requirements for original
• The Community or the Provincial registration of land acquired through
Environment and Natural Resources prescription
(CENRO/PENRO) is directed to process  The evidence sufficient to prove the
the application for agricultural free patents alienable and disposable status of
within 120 days. land for purposes of registration
under PD 1529.
Purpose of RA 11573
• to simplify, update and harmonize similar Summary
and related provisions of land laws in • In 1958, Manuel Dee Ham had the
order to simplify and remove ambiguity in Subject Property surveyed and declared
its interpretation and implementation. It is in his name for tax purposes. After
also the policy of the State to provide land Manuel's death, the property was inherited
tenure security by continuing judicial and by his wife and children, who transferred
administrative titling processes.
ownership to the Dee Ham family
corporation, PRCI. PRCI began paying the
Section 7. Proof that the Land is Alienable
property taxes, and in 2009, Esperanza
and Disposable. For purposes of judicial
executed an Affidavit formalizing the
confirmation of imperfect titles filed under
transfer. In 2010, Esperanza, as President
Presidential Decree No. 1529, a duly signed
certification by a duly designated DENR of PRCI, filed an application for original
geodetic engineer that the land is part of registration of title over the Subject
alienable and disposable agricultural lands of Property. The RTC rendered a judgment
the public domain is sufficient proof that the confirming and affirming PRCI's title to the
land is alienable. Said certification shall be property under PD 1529, also known as
imprinted in the approved survey plan the Property Registration Decree. CA
submitted by the applicant in the land affirmed the RTC Decision and denied
registration court. The imprinted certification in Republic’s Motion for Reconsideration.
the plan shall contain a sworn statement by the Thus, this instant case.
geodetic engineer that the land is within the • The SC remanded the case to the CA for
alienable and disposable lands of the public reception of evidence on the Subject
domain and shall state the applicable Forestry Property's land classification status in
Administrative Order, DENR Administrative accordance with Section 7 of RA 11573.
Order, Executive Order, Proclamations and the Thereafter, the CA is directed to resolve
Land Classification Project Map Number
PRCI's application for land registration
covering the subject land.
with utmost dispatch following the
guidelines set forth in this Decision.
Important points discussed in Republic v. PRCI  In Malabanan, the requirements for original
case: registration under then Section 14(2) were: (i) a
 While lands of the public domain under the declaration that the land subject of the
Constitution pertain to all lands owned or held application is alienable and disposable; (ii) an
by the State both in its public and private express government manifestation that said
capacity, lands forming part of the public land constitutes patrimonial property, or is "no
dominion under the Civil Code pertain only to longer retained" by the State for public use,
those which are intended for public use, public public service, or the development of national
service, or the development of national wealth, wealth; and (iii) proof of possession for the
and excludes patrimonial property. Therefore, period and in the manner prescribed by the Civil
property of public dominion and patrimonial Code for acquisitive prescription, reckoned from
property, as defined by the Civil Code, both fall the moment the property subject of the
within the scope of public domain contemplated application becomes patrimonial property of the
under the 1987 Constitution. Excepted from the State.
scope of public domain are lands subject of a  The second Malabanan requirement, that is, the
claim of ownership based on native title as express government manifestation that the land
explicitly recognized in Cariño v. Insular constitutes patrimonial property, was anchored
Government on the premise that "all lands owned by the
 The proper interpretation of Article 422 in State, although declared alienable or
relation to Articles 420 and 421 is that disposable, remain as [property of public
"converted" patrimonial property can only come dominion] and ought to be used only by the
from property of public dominion under Article Government." However, this premise was not
420. Hence, "converted" patrimonial property meant to be adopted in absolute terms.
should not be understood as a subset of  Once property of public dominion is classified
patrimonial property "by nature" under Article by the State as alienable and disposable land of
421. the public domain, it immediately becomes
 In effect, the classification of agricultural land as open to private acquisition, since "[a]lienable
alienable and disposable serves as unequivocal lands of the public domain x x x [form] part of
proof of the withdrawal by the State of the said the patrimonial [property] of the State." The
land from the public dominion, and its operative act which converts property of public
"conversion" to patrimonial property. The clear dominion to patrimonial property is its
intention of such conversion is to open the land classification as alienable and disposable land
to private acquisition or ownership. Again, as of the public domain, as this classification
keenly observed by Justice Gaerlan, such precisely serves as the manifestation of the
converted patrimonial property remains within State's lack of intent to retain the same for
the broader constitutional concept of public some public use or purpose.
domain precisely as alienable and disposable  Consequently, those who seek registration on
land of the public domain the basis of title over land forming part of the
 Clearly, any specific property of the State may public domain must overcome the presumption
either be outside or within the commerce of of State ownership. To do so, the applicant
man; it cannot be both. Prior to the classification must establish that the land subject of the
of such property to alienable and disposable, application is alienable or disposable and thus
agricultural lands (being property of public susceptible of acquisition and subsequent
dominion) are beyond the commerce of man. It registration. However, once the presumption of
is the classification of agricultural lands as State ownership is discharged by the applicant,
alienable and disposable which places them the burden to refute the applicant's claim that
within the commerce of man, and renders them the land in question is patrimonial in nature
capable of being the subject matter of contracts necessarily falls on the State. For while the
(such as a patent, the latter being a contract burden to prove that the land subject of the
between the State and the grantee). In turn, the application is alienable and disposable is
power to classify (and re-classify) land is vested placed on the applicant, the burden to prove
solely in the Executive Department. Once a that such land is retained for public service or
parcel of land forming part of public dominion is for the development of the national wealth,
classified as alienable and disposable, they notwithstanding its previous classification as
become subject to private acquisition but only alienable and disposable, rests, as it should,
through the prescribed modes of acquisition of with the State.
ownership.
 Where the property subject of the  However, and to be clear, where the property
application had not been utilized by the subject of the application had been previously
State, and the latter had not manifested any utilized by the State for some public purpose,
intention to utilize the same, proof of proof of conversion requires the
conversion into patrimonial property establishment of a positive fact — the
requires the establishment of a negative abandonment by the State of its use and the
fact — the lack of intent on the part of the consequent withdrawal of the property from
State to retain the property and utilize the the public dominion. To establish this positive
fact, it becomes incumbent upon the applicant
same for some public purpose. In such
to present an express government
situations, what precludes the conversion of
manifestation that the land subject of his
property of public dominion to patrimonial
application already constitutes patrimonial
property is an existing intention to use the
property, or is no longer retained for some
same for public purpose, and not one that
public purpose. It is within this context that
is merely forthcoming. the second requirement espoused in
 In other words, placing on the applicant the Malabanan was crafted. This second
burden to prove the State's lack of intent to requirement covered "converted" patrimonial
retain the property would be unreasonable, property of the State, or those falling within
and totally beyond the text and purpose of the scope of Article 422 of the Civil Code.
PD 1529. Further, this renders illusory the  Notably, Section 6 of RA 11573 shortens the
legal provisions in the Civil Code for the period of possession required under the old
acquisition of property. After all, it is the Section 14(1). Instead of requiring applicants
State which has the capacity to prove its to establish their possession from "June 12,
own intent to use such property for some 1945, or earlier", the new Section 14(1) only
public purpose in the absence of any overt requires proof of possession "at least twenty
manifestation thereof through prior use, (20) years immediately preceding the filing of
occupation, or express declaration. the application for confirmation of title except
 Jurisprudence instructs that when the when prevented by war or force majeure."
plaintiff's case depends upon the  Equally notable is the final proviso of the new
establishment of a negative fact, and the Section 14(1) which expressly states that
means of proving the fact are equally within upon proof of possession of alienable and
disposable lands of the public domain for the
the control of each party, the burden of
period and in the manner required under said
proof is placed upon the party averring the
provision, the applicant/s "shall be
negative fact. Conversely, if the means to
conclusively presumed to have performed all
prove the negative fact rests easily, if not
the conditions essential to a Government
only, upon the defendant, the plaintiff
grant and shall be entitled to a certificate of
should not be made to bear the burden of title under this section." This final proviso
proving it. unequivocally confirms that the classification
 In cases where land held by the State has of land as alienable and disposable
not been previously utilized for some public immediately places it within the commerce of
purpose, the State has no prior use to man, and renders it susceptible to private
abandon or withdraw the land from. It would acquisition through adverse possession.
therefore be unreasonable to require the
applicant to present a law or executive Guidelines on the application of RA 11573 as
proclamation expressing such discussed in Republic v. PRCI case:
abandonment for there never will be one. 1. RA 11573 shall apply retroactively to all
The imposition of this additional applications for judicial confirmation of title
requirement in cases where the land so which remain pending as of September 1,
possessed had never been utilized by the 2021, or the date when RA 11573 took
State has dire consequences for those who effect. These include all applications
have occupied and cultivated the land in the pending resolution at the first instance
concept of owners for periods beyond what before all Regional Trial Courts, and
is required by law. applications pending appeal before the
Court of Appeals.
2. Applications for judicial confirmation of title F. CERTIFICATE OF TITLE

filed on the basis of the old Section 14(1)
DEFINITION
and 14(2) of PD 1529 and which remain
pending before the Regional Trial Court or
• A certificate of title is the transcript of the
Court of Appeals as of September 1, 2021 decree of registration made by the Registrar
shall be resolved following the period and of Deeds in the registry. (Philippine National
manner of possession required under the Bank vs. Tan Ong Zse | G.R. No. L-27991 |
new Section 14(1). Thus, beginning December 24, 1927)
September 1, 2021, proof of "open, • The certificate of registration accumulates in
continuous, exclusive and notorious open document a precise and correct
possession and occupation of alienable statement of the exact status of the fee held
and disposable lands of the public domain by its owner. The certificate, in the absence
not covered by existing certificates of title of fraud, is the evidence of title and shows
or patents under a bona fide claim of exactly the real interest of its owner. The
ownership for at least twenty (20) years title once registered, with very few
immediately preceding the filing of the exceptions, should not thereafter be
application for confirmation" shall be impugned, altered, changed, modified,
sufficient for purposes of judicial enlarged, or diminished, except in some
confirmation of title, and shall entitle the direct proceeding permitted by law.
applicant to a decree of registration. Otherwise all security in registered titles
3. In the interest of substantial justice, the would be lost. (Legarda v. Saleeby | G.R.
Regional Trial Courts and Court of Appeals No. L-8936 | October 2, 1915).
are hereby directed, upon proper motion or
motu proprio, to permit the presentation of Kinds of Certificate of Title:
additional evidence on land classification
1. Original Certificate of Title (OCT)
status based on the parameters set forth in
2. Transfer Certificate of Title (TCT)
Section 7 of RA 11573.
3. Condominium Certificate of Title (CCT)
a. Such additional evidence shall consist
of a certification issued by the DENR
Duplicate Certificate of Title
geodetic engineer which (i) states that
The following are entitled to a duplicate
the land subject of the application for
certificate of title:
registration has been classified as
alienable and disposable land of the 1. Registered Owner
public domain; (ii) bears reference to 2. Co-owner
the applicable Forestry Administrative
Order, DENR Administrative Order, Original Certificate of Title Distinguished
Executive Order, or proclamation from Transfer Certificate of Title
classifying the land as such; and (iii)
OCT TCT
indicates the number of the LC Map
covering the land. Issued for the first
b. In the absence of a copy of the time after the land Issued after the
relevant issuance classifying the land has been cancellation of
as alienable and disposable, the adjudicated and the original
certification must additionally state (i) decreed in the certificate of
As to issuance
the release date of the LC Map; and name of its owner title when the
(ii) the Project Number. Further, the
in original or initial land is
certification must confirm that the LC
registration transferred by
Map forms part of the records of
NAMRIA and is precisely being used
proceedings by the registered
by the DENR as a land classification the Registrar of owner by
map. Deeds where the reason of sale
c. The DENR geodetic engineer must be land lies pursuant or otherwise or
presented as witness for proper to the decree of subsequently.
authentication of the certification in registration.
accordance with the Rules of Court.
OCT TCT XPN: burdens on the land registered which

continue to exist and remain in force although not
noted in the title
To convey the
To place the land 1. liens, claims or rights arising or existing
land already under
for the first time under the laws and Constitution of the
As to Legal Effect
the operation of Philippines which are not by law required to

under the
the Torrens appear of record in the Registry of Deeds in
operation of the
system from one order to be valid against subsequent
Torrens system
person to another purchasers or encumbrances of record.
(Section 45, Act
(Sec. 50, Act 496, 2. unpaid real estate taxes levied and
496)
now Sec. 51, P.D. assessed within two years immediately
1529). preceding the acquisition of any right over
the land by an innocent purchaser for value,
without prejudice to the right of the
Holds the land government to collect taxes payable before
free of all that period from the delinquent taxpayer
encumbrances May hold the alone.
except those same subject to 3. any public highway or private way
Effect to person receiving
noted on said more established or recognized by law, or any

certificate, and encumbrances, government irrigation canal or lateral
any of the such as prior thereof, if the certificate of title does not
encumbrances interests which state that the boundaries of such highway or
specifically though irrigation canal or lateral thereof have been
enumerated in unregistered, he determined.
Sec. 39, Act 496 had knowledge of 4. any disposition of the property or limitation
on the use thereof by virtue of, or pursuant
(now Sec. 44, P.D. at the time of the
to, Presidential Decree No. 27 or any other
1529) which may purchase.
law or regulation on agrarian reform (these
be subsisting
are all provided for under Sec. 44 of P.D.
1529), e) rights incident to the relation of
husband and wife, landlord and tenant, or
Enforceability of Certificate of Title: from liability to attachment or levy on
• valid and enforceable against the whole execution, or from liability to any lien of any
world by the fact that it was issued description established by law on the land
pursuant to a decree of registration and the buildings thereon, or on the interest
of the owner in such land or buildings, or to
based upon final judgment promulgated
change the laws of descent, or the rights of
by a court of competent jurisdiction after
partition between co-owners, or the right to
due publication, notice and hearing, take the same by eminent domain, or to
provided that the said decree has not relieve such land from liability to be
been reopened within one year from the recovered by an assignee in insolvency or
date of its issuance on the ground of trustee in bankruptcy under the laws relative
actual fraud. to preferences, or to change or affect in any
• Once registered, cannot be defeated, way other rights or liabilities created by law
and applicable to unregistered land, except
even by adverse, open, and notorious
as otherwise provided by this Decree
possession.
(Section 46, P.D. 1529).
• Once registered, cannot be defeated by
prescription. Remedy For a Lost Duplicate Certificate of Title
• A conclusive evidence of the ownership • If a duplicate certificate is lost or destroyed,
of the land referred to therein. or cannot be produced by a person applying
• After the expiration of the one (1) year for the entry of a new certificate to him, or
for the registration of any instrument, a
period from the issuance of the decree of
sworn statement of the fact of such loss or
registration upon which it is based, it
destruction may be filed by the registered
becomes incontrovertible. owner or other person in interest and
registered (Sec. 109, P.D. 1529).
G. SUBSEQUENT XPN:
REGISTRATIION 1. Where the purchaser or mortgagee is a
bank/financing institution, the general rule that
a purchaser or mortgagee of the land is not
Conveyance and other dealings by
required to look further than what appears on
registered owner.
the face of the title does not apply (Dela
An owner of registered land may: Merced v. GSIS, 365 SCRA 1 [2001]).
1) convey, 2. Where the owner still holds a valid and existing
2) mortgage, certificate of title covering the same property
3) lease, because the law protects the lawful holder of a
4) charge or otherwise deal with the registered title over the transfer of a vendor
same in accordance with existing bereft of any transmissible right (Tomas v.
laws. Tomas, 98 SCRA 280 [1980]).
3. Purchaser in bad faith (Egeo v. CA, 174 SCRA
General Rule: It shall operate only as a contract 484 [1989])
between the parties and as evidence of authority 4. Sufficiently strong indications to impel closer
to the Register of Deeds to make registration inquiry into the location, boundaries, and
(Sec. 51) condition of the lot (Francisco v. CA, 153
SCRA 330 [1987]).
XPN: In order to bind the land, such 5. Where a person buys land not from the
conveyance, mortgage, lease, lien, attachment, registered owner but from one whose rights to
order, judgment, instrument or entry affecting the land has been merely annotated on the
certificate of title (Quiniano v. CA, 39 SCRA
registered land must be registered, filed or
221 [1971]).
entered in the office of the Register of Deeds for
6. Purchases land with a certificate of title
the province or city where the land to which it
containing a notice of lis pendens.
relates lies, thereafter, it shall be constructive
7. Purchaser had full knowledge of flaws and
notice to all persons from the time of such
defects in the title (Bernales v. IAC, 166 SCRA
Registering, filing or entering. (Sec. 52) 519, [1988]).
1. VOLUNTARY DEALINGS 2. INVOLUNTARY DEALINGS

• It is intended to create or preserve any lien,
General Rule: A voluntary instrument can be status, right, or attachment upon registered
registered only when the owner’s duplicate land.
certificate is presented with such instrument. • Transactions affecting land in which
cooperation of registered owner is not needed,
XPN: In cases provided by law, and upon order or even against his will.
of the court, for causes shown, the same may be
registered even without a showing of such. a. ADVERSE CLAIMS
• Is a notice to third persons that someone is
Consequence of showing the owner’s claiming an interest on the property or has a
duplicate certificate with the voluntary better right than the registered owner thereof.
instrument: The disputed land is subject to the outcome of
• There is vested a conclusive authority from the dispute.
the registered owner to the Register of • The annotation of an adverse claim is a
Deeds to enter a new certificate or to make measure designed to protect the interest of a
memorandum of registration in accordance person over a piece of real property where the
of such instrument. registration of such interest or right is not
otherwise provided for by the Land Registration
Act, and serves as a notice and warning to third
Forged or Fraudulent Deed
parties dealing with said property that someone
General Rule: Although generally a forged or
is claiming an interest on the same or a better
fraudulent deed is a nullity and conveys no title,
right than the registered owner thereof. (Lucio
however, there are instances where such a
C. Sanchez, Jr., vs. Hon. Court of Appeals and
fraudulent document may become the root of a Rural Bank of Ormoc City, Inc. | G.R. No. L-
valid title. 40177 | February 12 1976)
• An adverse claim arises whenever a person Period of Effectivity; When Cancelled

claims any part or interest averse to the • The adverse claim shall be effective for a
registered owner's interest; arising period of 30 days from the date of registration
subsequent to registration. and it may be cancelled after the lapse of 30
days, upon the filing by the party in-interest of
Claim is adverse when: a verified petition for such purpose
1. A claimant’s right or interest in registered • Before the lapse of said 30 days, upon the
land is adverse to the registered owner; filing by the claimant of a sworn petition
2. Such right arose subsequent to date of withdrawing his adverse claim
original registration • Before the lapse of the 30-day period, when a
3. No other provision is made in the Decree for party-in-interest files a petition in the proper
the registration of such right or claim (Sec. RTC for the cancellation of the adverse claim
70, PD 1529, Sanchez v. CA, 69 SCRA 327 and, after notice and hearing, the court finds
(1976) that the claim is invalid. If the court also finds
• A mere money claim cannot be registered the claim to be frivolous, it may fine the
as an adverse claim claimant the amount of not less than 1,000
• Actual knowledge is equivalent to pesos nor more than 5,000 pesos, in its
registration of adverse claim. discretion.
• No 2nd adverse claim based on the same • Diaz-Duarte v. Ong, 298 SCRA 388 (1998) -
ground may be registered by the same For this purpose, the interested party must file
claimant. with the proper court a petition for
cancellation of adverse claim, and a hearing
How annotated must also first be conducted. The Register of
• The adverse claimant shall execute an Deeds cannot on its own automatically cancel
affidavit which shall state his claim to any the adverse claim.
part or interest in the registered land
adverse to the registered owner. b. NOTICE OF LIS PENDENS
• The affidavit shall be filed with the Register
of Deeds; who, after examination of the Lis Pendens
claim may annotate the adverse claim on • Lis pendens literally means a pending suit
the registered land. • Doctrine that refers to the jurisdiction, power
or control which a court acquires over a
Requisites property involved in a suit, pending the
1. The adverse claimant must state the continuance of the action, until final judgment
following in writing:
1. his alleged right or interest; Purpose of Lis Pendens
2. how and under whom such alleged • To constructively advise, or warn all people
right or interest is acquired; who deal with the property that they so deal
3. the description of the land in which with it at their own risk, and whatever rights
the right or interest is claimed; and they may acquire in the property in any
4. the number of the certificate of title; voluntary transaction are subject to the results
2. The statement must be signed and sworn of the action, and may well be inferior and
to before a notary public or other officer subordinate to those which may be finally
authorized to administer oath; and determined and laid down therein. [Heirs of
3. The claimant should state his residence or Marasigan v. IAC, 152 SCRA 253 (1987)]
the place to which all notices may be • It merely creates a contingency and not a lien.
served upon him. Non-compliance with the • To protect the rights of the party causing the
above requisites renders the adverse claim registration of the lis pendens
non-registrable and ineffective. • To advise third persons who purchase or
contract on the subject property that they do
Effects so at their peril and subject to the result of the
Any potential buyer of land shall be considered pending litigation
to have been alerted of any defect in the title • May involve actions that deal not only with
The individual shall be considered in bad faith if title or possession of a property but also with
he purchases land despite the annotation. the use and occupation of a property
• The litigation must directly involve a specific How registered:

property which is necessarily affected by Registration shall be effected through a
the judgment memorandum or notice stating:
• The notice of lis pendens is a notice to the (a) the institution of such action or
whole world that a particular real property is proceeding and the court wherein the
in litigation. The inscription serves as a same is pending,
warning that one who acquires interest over (b) the date of the institution thereof,
litigated property does so at his own risk, or (c) a reference to the number of the
that he gambles on the result of the
certificate of title,
litigation over the property
(d) an adequate description of the land
• A purchaser who buys registered land with
affected and the registered owner
full notice of the fact that it is in litigation
thereof, shall have been filed and
between the vendor and third party stands
registered. (Sec. 76, P.D. No. 1529)
in the shoes of his vendor and his title is
subject to the incidents and results of the
How cancelled
pending litigation
• The cancellation of the notice of lis
Section 76 of the Presidential Decree 1529 pendens under the first paragraph of
“Notice of lis pendens. No action to recover Section 77 involves the filing of a motion
possession of real estate, or to quiet title in the court where the action (Which is the
thereto, or to remove clouds upon the title source of the lis pendens) is pending·
thereof, or for partition, or other proceedings Thus, the court may order the removal of
of any kind in court directly affecting the title to the annotation even while the case is
land or the use or occupation thereof or the pending.
buildings thereon, and no judgment, and no • A notice of lis pendens may be cancelled
proceeding to vacate or reverse any judgment, when the annotation is:
shall have any effect upon registered land as 1. only for purpose of molesting an
against persons other than the parties thereto, adverse party;
unless a memorandum or notice stating the 2. not necessary to protect the title of the
institution of such action or proceeding and party who caused it to be recorded;
the court wherein the same is pending, as well 3. When the consequences of the trial are
as the date of the institution thereof, together unnecessarily delaying the
with a reference to the number of the determination of the case to the
certificate of title, and an adequate description
prejudice of the other party.
of the land affected and the registered owner
• Register of Deeds may also cancel by
thereof, shall have been filed and registered.”
verified petition of party who caused such
registration
What must be registered?
• Deemed cancelled when certificate is
1. Action to recover possession of real
issued by clerk of court stating manner of
estate·
2. To quiet title thereto. disposal of proceeding that is registered
3. To remove clouds upon the title thereof.
4. Partition; Lis Pendens has no Application To The
5. Other proceedings of any kind in court Following:
directly affecting the title to land or the • Preliminary attachment;
use or occupation thereof or the • Proceedings for the probate of wills;
buildings thereon; and • Levies on execution;
6. No judgment, and no proceeding to • Proceedings for administration of estate
vacate or reverse any judgment, shall of deceased persons; and
have any effect upon registered land as • Proceedings in which the only object is
against persons other than the parties the recovery of a money judgment.
thereto.
H. NON-REGISTRABLE 2. Ensure that the recording of the deed and

PROPERTIES other instruments relating to unregistered lands
shall be effected by any of annotation on the
1. Property of Public Dominion space provided therefor in the Registration
• Properties of public dominion have been Book, after the same shall have been entered in
described as those which, under existing the Primary Entry Book.
legislation, are not the subject of private
ownership and are reserved for public 3. If, on the face of the instrument, it appears
purposes (Republic vs. Court of Appeals, 131 that it is sufficient in law, the Register of Deeds
SCRA 532, 537 (1984) shall forthwith record the instrument in the
• According to the Civil Code, the following manner provided herein.
things are property of public dominion:
1. Land intended for public use or service 4. In case the Register of Deeds refuses its
not available for private appropriation; administration to record, said official shall advise
2. Those which belong to the State, without the party in interest in writing of the ground or
being for public use, and are intended for grounds for his refusal, and the latter may
some public service or for the appeal the matter to the Commissioner of Land
development of the national wealth. Registration in accordance with the provisions of
Section 117 of this Decree, without prejudice to
2. Specific kinds of non-registrable a third party with a better right.
properties:
1. Forest or timberland, public forest, forest 5. After recording on the Record Book, endorse
reserves among other things, upon the original of the
2. Mangrove swamps recorded instruments, the file number and the
3. Mineral lands date as well as the hour and minute when the
4. Foreshore land and Seashore document was received for recording as shown
5. Navigable rivers, streams and creeks in the Primary Entry Book, returning to the
6. Lakes registrant or person in interest the duplicate of
7. Military Reservations the instrument, with appropriate annotation,
8. Other kinds of Reservations certifying that he has recorded the instrument
9. Watershed after reserving one copy thereof to be furnished
10. Grazing lands the provincial or city assessor as required by
11. Previously titled land existing law.
12. Alluvial deposit along river when manmade
6. In case the Register of Deeds refuses its
I. DEALINGS WITH administration to record, said official shall advise
UNREGISTERED LANDS the party in interest in writing of the ground or
grounds for his refusal, and the latter may
General Rule: No deed, conveyance, mortgage,
appeal the matter to the Commissioner of Land
lease, or other voluntary instrument affecting
Registration in accordance with the provisions of
land not registered under the Torrens system
Section 117 of this Decree, without prejudice to
shall be valid, except as between the parties
a third party with a better right.
thereto.
XPN: Unless such instrument shall have been
7. After recording on the Record Book, endorse
recorded in the manner herein prescribed in the
among other things, upon the original of the
office of the Register of Deeds for the province
recorded instruments, the file number and the
or city where the land lies. (Sec. 113)
date as well as the hour and minute when the
document was received for recording as shown
Duty of Register of Deeds: (Sec. 113)
in the Primary Entry Book, returning to the
1. Keep a Primary Entry Book and a Registration
registrant or person in interest the duplicate of
Book containing the following particulars:
the instrument, with appropriate annotation,
1. Entry Number
certifying that he has recorded the instrument
2. Names of the parties
after reserving one copy thereof to be furnished
3. The nature of the document
the provincial or city assessor as required by
4. The date, hour and minute it was
existing law.
presented and received
J. ASSURANCE FUND How judgment satisfied: (Secs. 97-99)

• If there are defendants other than the
1. NATURE OF ASSURANCE FUND National Treasurer and the Register of Deeds
It is the special fund which is created under the and judgment is entered for the plaintiff and
Torrens system for the compensation of certain against the National Treasury, the Register of
persons for losses sustained by operations Deeds and any of the other defendants,
under the system. execution shall first issue against such
defendants other than the National Treasurer
2. CONDITIONS FOR COMPENSATION and the Register of Deeds. (Sec. 97)
FROM ASSURANCE FUND • If at any time the Assurance Fund is not
Action of Compensation From Funds sufficient to satisfy such judgment, the
This action is civil in character and may be in the National Treasurer shall make up for the
form of the ordinary complaint for damages. The deficiency from any funds available in the
action for recovery of damages from the treasury not otherwise appropriated. (Sec. 98)
Assurance Fund may be availed of in case of • If the execution is returned unsatisfied, wholly
insolvency of the party who procured the or partly, and the officer returning the same
wrongful registration. certifies that the amount cannot be collected
from the land or personal property of such
Requisites other defendant, the remaining amount
1. That a person sustains loss or damage, or is unpaid is to be paid by the National Treasurer
deprived of any estate or interest in land out of the Assurance Fund. In the latter case,
2. On account of the bringing of land under the the Government of the Republic of the
operation of the Torrens system arising after Philippines is subrogated to the rights of the
original registration, plaintiff against any other parties or entities
3. Through fraud, error, omission, mistake or (Sec. 99)
misdescription in a certificate of title or entry
or memorandum in the registration book, Measure of Damages
4. Without negligence on his part, and The maximum amount of damages recoverable
5. He is barred or precluded from bringing an as compensation from the Assurance Fund is
action for the recovery of such land or estate not the assessed value nor the actual value at
or interest therein. the time of recovery but an amount not more
6. The action has not prescribed. than the fair market value of the land at the time
he suffered the loss, damage or deprivation
Jurisdiction thereof (Sec. 97)
• The Regional Trial Court of the place
where the land is located shall be vested 3. PRESCRIPTIVE PERIOD
with jurisdiction over the claims of an The plaintiff has a period of six years from the
individual for recovery against the time the right of action accrues within which to
Assurance Fund. (Sec. 95) bring the action against the Assurance Fund. In
a case, a complaint filed more than ten years
Period to File after the property had been registered was
• 6 years from the time the right to bring ordered dismissed
such action first accrued: (Sec. 102)
Sps. Stilianopoulos vs. Register of Deeds
Filed Against G.R. No. 224678, July 03, 2018
1. Registrar of Deeds “The constructive notice rule on registration
2. the National Treasurer and should not be made to apply to title holders who
have been unjustly deprived of their land without
3. other persons as co-defendants when:
their negligence. The actual title holder cannot
• “such action is brought to recover for loss be deprived of his or her rights twice – first, by
or damage or for deprivation of land or fraudulent registration of the title in the name of
any interest therein arising through fraud, the usurper and second, by operation of the
negligence, mistake or misfeasance of constructive notice rule upon registration of the
persons other than court personnel, the title in the name of the innocent purchaser for
value. As such, prescription, for purposes of
Registrar of Deeds, his deputy or other
determining the right to bring an action against
employees of the registry’’ (Sec. 96)
the Assurance Fund, should be reckoned from 4. An authenticated copy of the decree of
the moment the innocent purchaser for value registration or patent, as the case may be,
registers his or her title and upon actual pursuant to which the original certificate of
knowledge thereof of the original title title was issued;
holder/claimant. As above-discussed, the 5. A document, on file in the registry of
registration of the innocent purchaser for value's deeds, by which the property, the
title is a prerequisite for a claim against the description of which is given in said
Assurance Fund on the ground of fraud to document, is mortgaged, leased or
proceed, while actual knowledge of the encumbered, or an authenticated copy of
registration is tantamount to the discovery of the said document showing that its original
fraud. More significantly, this interpretation had been registered; and
preserves and actualizes the intent of the law, 6. Any other document which, in the
and provides some form of justice to innocent judgment of the court, is sufficient and
original title holders.” proper basis for reconstituting the lost or
destroyed certificate of title.
K. RECONSTITUTION OF TITLE
• Reconstitution is the restoration of the 2. For transfer certificates of title: (Section 3 of

instrument or title allegedly lost or RA No. 26)
destroyed in its original form and condition 1. The owner’s duplicate of the certificate of
(Anciano v. Caballes | G.R. No L-5040 | title;
September 29, 1953) 2. The co-owner’s, mortgagee’s, or lessee’s
• Reconstitution of certificates of title literally duplicate of the certificate of title;
and within the meaning of Republic Act No. 3. A certified copy of the certificate of title,
26, denotes restoration of the instrument previously issued by the register of deeds
which is supposed to have been lost or or by a legal custodian thereof;
destroyed in its original form and condition. 4. The deed of transfer or other document,
on file in the registry of deeds, containing
Jurisdictional requirements: the description of the property, or an
a. publication authenticated copy thereof, showing that
b. posting, and its original had been registered, and
c. service of notice pursuant to which the lost or destroyed
• The jurisdictional requirements are transfer certificate of title was issued;
mandatory. They provide constructive 5. A document, on file in the registry of
notice to the whole world of the in rem deeds, by which the property, the
reconstitution proceedings description of which is given in said
document, is mortgaged, leased or
Elements: encumbered, or an authenticated copy of
1. That the certificate of title has been lost or said document showing that its original
destroyed; had been registered; and
2. That the petitioner is the registered owner 6. Any other document which, in the
or has an interest therein; and judgment of the court, is sufficient and
3. That the certificate of title was in force at proper basis for reconstituting the lost or
the time it was lost or destroyed.
destroyed certificate of title.
Sources of Reconstitution:
3. For liens and encumbrances: (Section 4 of
1. For original certificates of title: (Section 2 of
RA No. 26)
RA No. 26)
1. Annotations or memoranda appearing on
1. The owner’s duplicate of the certificate of
the owner’s co-owner’s mortgagee’s or
title;
lessee’s duplicate;
2. The co-owner’s, mortgagee’s, or lessee’s
2. Registered documents on file in the
duplicate of the certificate of title;
registry of deeds, or authenticated copies
3. A certified copy of the certificate of title,
thereof showing that the originals thereof
previously issued by the register of deeds
or by a legal custodian thereof; had been registered; and
3. Any other document which, in the • the owner’s duplicate certificate or co-
judgment of the court, is sufficient and owner’s duplicate is in due form without
proper basis for reconstituting the liens or any apparent intentional alterations or
encumbrances affecting the property erasures;
covered by the lost or destroyed certificate • the certificate of title is not the subject of
of title. litigation or investigation, administrative or
• Where to file: Under Section 12, RA judicial, regarding its genuineness or due
No. 26, the petition for reconstitution execution or issuance;
which shall be filed by the registered • the certificate of title was in full force and
owner, his assigns, or any person effect at the time it was lost or destroyed;
having an interest in the property with • the certificate of title is covered by a
the proper Regional Trial Court where declaration regularly issued by the
the same is based on sources Assessor’s Office; and
enumerated in Sections 2(c), 2(d), • real estate taxes have been fully paid up to
2(e), 2(f), 3(c), 3(d), 3(e) and/or 3(f) of at least two years prior to the filing of said
the Act. petition.
Ways to Reconstitute Title If the petition were based on the co-owner’s or

(1) Administrative Reconstitution mortgagee’s duplicate of the certificate of title,
(2) Judicial Reconstitution the petitioner shall state, in addition to the
above-mentioned contents, that:
‘Administrative Reconstitution’ defined • the owner’s duplicate has been lost or
Administrative Reconstitution of title may be destroyed and the circumstances under
based on the owner’s duplicate of the certificate which it was lost or destroyed.
of title; and the co-owner’s, mortgagee’s, or
lessee’s duplicate of said certificate. Where to file Petition for Administrative
Reconstitution
Content of Petition for Administrative • may be filed with the Register of Deeds
Reconstitution concerned by the registered owner, his
Petition for administrative reconstitution of title assigns, or other persons, both natural and
shall state, among others: juridical, having an interest in the
(a) petitioner’s full name, address and other property.
personal circumstances; • Thereafter, the Register of Deeds shall
(b) the nature of his interest in the property; forward the petition and its accompanying
and documents, together with its comments, if
(c) the title number of the certificate of title any, to the Reconstituting Officer, whose
sought to be reconstituted. (In its Circular order of reconstitution, however, may be
No. 13 dated July 26, 1989, the LRA reviewed, revised, reversed, or modified
requires that the) by the LRA upon appeal.
Requirements for Petition for Administrative ‘Judicial Reconstitution’ defined

Reconstitution It is a court case which shall be filed in the
The petition shall be accompanied with three proper Regional Trial Court by the registered
clear and legible photocopies of the owner’s or owner, his assigns, or any person having an
co-owner’s duplicate of the certificate of title and interest in the property.
the registered owner’s affidavit, stating that:
• No deed or other instrument affecting the Content of a Petition for Judicial
property had been presented for Reconstitution
registration or, if there be any, the nature Said petition shall allege the following:
thereof, the date of its presentation, as 1. that the owner’s duplicate of the certificate
well as the names of the parties, and of title had been lost or destroyed;
whether the registration of such deed or 2. that no co-owner’s, mortgagee’s or
instrument is still pending lessee’s duplicate had been issued or, if
accomplishment; any had been issued, the same had been
lost or destroyed;
3. the location, area and boundaries of the Thus, the bases for the reconstitution of the title
property; were not only the plans and technical
4. the nature and description of the building descriptions but also the legible duplicate copies
or improvements, if any, which do not of the titles and a host of other official
belong to the owner of the land, and the documents. In sum, the Court finds that there
names and addresses of the owners of was sufficient basis for the RTC to grant the
such buildings or improvements; petition for reconstitution.
5. the names and addresses of the
occupants or persons in possession of the Republic Vs. Heirs of Eduardo Booc
property, of the owners of the adjoining G.R. No. 207159, February 28, 2022
properties and of all persons who may J. Hernando
have interest in the property; Ruling:
6. a detailed description of the All told, the RTC did not acquire jurisdiction over
encumbrances, if any, affecting the the case. Respondents failed to comply with the
property; and legal requirements under RA 26 for the petition
for reconstitution to be given due course.
7. a statement that no deeds or other
Furthermore, respondents did not adduce
instruments affecting the property have
competent evidence that the OCTs of the
been presented for registration, or if there
subject lots existed and were indeed issued in
be any, the registration thereof has not
the name of the Boocs. To stress, the purpose of
been accomplished, as yet.
the reconstitution of a certificate of title under RA
26 is to have the same reproduced, after proper
Republic of the Philippines Vs. Abellanosa, proceedings in the same form it was when the
G.R. No. 205817, October 06, 2021 loss or destruction occurred.
J. Hernando
Ruling: Thus, before any reconstitution may be made,
The reconstitution of title is an action in rem, there should be sufficient and competent proof
which means it is one directed not only against that the title sought to be reconstituted had
particular persons, but against the thing itself. actually existed. There is insufficient evidence
The essence of posting and publication is to showing that OCTs of the subject lots in the
give notice to the whole world that such petition name of the Boocs exist. Section 109 of
has been filed and that interested parties may Presidential Decree No. 152984 mandates that
intervene or oppose in the case. This purpose the owner must file with the proper Registry of
was achieved in this case when notices on the Deeds a notice of loss executed under oath.
first and second amendments were duly served Here, as early as 1976, respondents knew that
upon the parties in interest of the case and the duplicate certificates of title were already
proper posting and publication was made to the lost. Yet, they did not execute an affidavit of loss
original petition for reconstitution. In view of or had submitted the same as evidence if there
this, We find that the court validly acquired is one giving rise to serious doubts if the
jurisdiction over the case. purported certificates of title indeed existed;
Petitioner's assertion that the bases of the Respondents did not also submit any tax
second amendment, such as plans and declarations relative to the subject lots.
technical descriptions, are not grounds for filing
the petition for reconstitution, is just as While a tax declaration does not prove
unacceptable. ownership, payment of realty tax is an exercise
of ownership over the said lots and is the payor's
For the judicial reconstitution of an existing and unbroken chain of claim of ownership over it.
valid original certificate of Torrens title, Section Moreover, respondents are guilty of laches.
2 of RA 26 has expressly listed the acceptable Laches is negligence or omission to assert a
bases: right within a reasonable time, warranting the
(a) The owner's duplicate of the certificate of presumption that the party entitled to assert it
title; either has abandoned or declined to assert it.
(f) Any other document which, in the judgment Here, respondents only filed the petition for
reconstitution 12 years after they first discovered
of the court, is sufficient and proper basis for
that the titles were allegedly lost or destroyed..
reconstituting the lost or destroyed certificate of
title.
In the instant case, the contents of the second
amendment and the original petition for
reconstitution, along with their respective
supporting documents, were considered
collectively by the RTC.
V. WILLS AND SUCCESSION

C. Intestate Succession
D. Provisions Common to Testate and
B. Testamentary Succession
Intestate Succession
A. GENERAL PROVISIONS c. Mixed Succession

 partly by will and partly by operation of law.
‘Succession’ defined
Mode of acquisition by virtue of which property, B. TESTAMENTARY
rights and obligations to the extent of the value SUCCESSION
of the inheritance of a person are transmitted
through his death to another or others either by 1. GENERAL PROVISIONS
his will or by operation of law. (Art 774 NCC) ‘Wills’ defined
A will is an act whereby a person is
‘Inheritance’ defined
permitted, with the formalities prescribed by
includes all the property, rights and obligations
law, to control to a certain degree the
of a person which are not extinguished by his
disposition of his estate, to take effect after
death. (Art 776 NCC) The inheritance of a his death.
person includes not only the property and the
transmissible rights and obligations existing at 2. CHARACTERISTICS OF A WILL
the time of his death, but also those which have
1. Strictly personal
accrued thereto since the opening of the
2. Unilateral and individual act
succession. (Art 781 NCC) 3. Formal and solemn
4. Mortis causa
‘Decedent’ defined 5. Ambulatory and revocable
person whose property is transmitted through
succession; if he left a will, he is also called ‘Strictly Personal’ defined
testator. (Art 775 NCC) a. Execution cannot be left in whole or in
part to the discretion of third person
‘Heir’ defined b. Duration or efficacy of institution of heirs
a person called to succession either by the or portions to be given cannot be left to
provision of a will or by operation of law. the discretion of third person
Devisees are persons to whom gift of real
property is given in a will, while legatees are Note:
persons given the gift of personal property in a Testator may entrust to a third person the
will. (Art 782 NCC) distribution of specific property or sums of
money left to a specified class or cause and
the designation of persons, institutions and
Succession occurs at the moment of death
establishments to which property or money
• Article 440. The possession of hereditary
is to be given (Art 786 NCC)
property is deemed to be transmitted to the
heir without interruption from the instant of the Kinds of Wills:
death of the decedent, in case the inheritance 1. Notarial will – Articles 804-806, & 807-
be accepted.” 808 in special cases
• Article 777. The rights to the succession are 2. Holographic – Articles 804 & 810
transmitted from the moment of the death of
the decedent.
3. NON-DELEGABILITY OF A
Kinds of Succession TESTAMENTARY POWER
a. Testate or Testamentary Succession
 refers to a situation where the person dies General Rule: The duration or efficacy of
leaving a last will. the designation of heirs, devisees or
b. Intestate or Legal Succession legatees, or the determination of the portions
 refers to a situation where the person died which they are to take, when referred to by
without a last will; the share in the name, cannot be left to the discretion of a
inheritance is called “intestate share. third person. (Art. 785 NCC)
XPN: The testator may entrust to a third person 6. FORM OF NOTARIAL AND
the distribution of specific property or sums of HOLOGRAPHIC WILLS
money that he may leave in general to specified
classes or causes, and also the designation of Formal Requisites of Notarial Wills
the persons, institutions or establishments to 1. The will must be in writing (Article 804);
which such property or sums are to be given or 2. It must be in the language or dialect
applied. (Art. 786, NCC) known to the testator;
3. The will must be signed by the testator or
4. APPLICABLE LAW AS TO FORM AND
by another person in his presence
SUBSTANCE OF A WILL
or under his express direction (Article
 As to FORM or extrinsic validity – the law
805);
in force at the time of execution of the will.
(Art. 795) 4. That the signing by the testator or
 As to SUBSTANCE or intrinsic validity – by the person under his express
governed by the law in force at the time of direction and in his presence must
decedent’s death. be done in the presence of at
least 3 instrumental witnesses;
5. TESTAMENTARY CAPACITY
5. That the will is attested and subscribed by
‘Testamentary capacity’ defined at least 3 credible witnesses in the
Refers to the ability as well as the power to presence of the testator and of each and
make a will. every one of them;
1. All persons not expressly prohibited by law 6. That the will must be signed by the
2. 18 years old and above
testator and by at least 3 credible
3. Sound mind
witnesses on the left hand margin on
each and every page;
‘Sound mind’ defined
7. That the will must be numbered
• To be of sound mind, it is not necessary that
correlatively in letters;
the testator be in full possession of all his
8. That the signing by the 3
reasoning faculties, or that his mind be wholly
unbroken, unimpaired, or unshattered by witnesses must be done in the
disease, injury or other cause. [Article 799 presence of the testator and each and
NCC] every one of them;
• It shall be sufficient if the testator was able at 9. There must be an Attestation
the time of making the will to know the nature clause stating therein the number of
of the estate to be disposed of, the proper pages upon which the will is written, a
objects of his bounty, and the character of the statement that the testator signed the
testamentary act. will or another person signed the
will under the express direction of the
‘Presumption of Sanity’ defined testator;
• A testator is presumed to be of sound mind at 10. The will is signed at the left
the time of the execution of the will in the margin by the testator and the 3
absence of proof to the contrary. [Art 800 instrumental witnesses in the
NCC] presence of the testator and of one
• The burden of proof that the testator was not another;
of sound mind at the time of making his 11. The will must be acknowledged before a
dispositions is on the person who opposes
notary public (Article 806);
the probate of the will.
12. The will must be read twice by 2
persons designated by the testator if the
‘Presumed Insane’ defined
testator is deaf or deaf-mute (Article 807);
if the testator, one month, or less, before making
13. If the testator is blind the will must be
his will was publicly known to be insane, the
read to him once, by one of the
person who maintains the validity of the will
must prove that the testator made it during a subscribing witnesses, and again, by the
lucid interval. notary public (Article 808); and
14. There must be substantial compliance
with all the requirements of the law
(Article 809).
Common Requirements laid down by ‘Attestation Clause’ defined

Article 804 of the Civil Code for both Constitutes a certification by the witnesses that
notarial and holographic wills requirements of law have been complied with. It
(1) In Writing must state:
(2) In a language or dialect is known to the a. the number of pages used upon which the will
is written
testator.
b. the fact that the testator signed the will and
 Oral wills (the testamentum
every page thereof, or caused some other
nuncupativum of the Institutes) are not
person to write his name, under his express
recognized in the Civil Code.
direction, in the presence of the instrumental
 The provisions of Art. 804 are witnesses.
mandatory. Thus, failure to comply c. that the latter witnessed and signed the will
with the two requirements nullifies the and all the pages thereof in the presence of
will. the testator and of one another. If the
attestation clause is in a language not known
Art. 805. Every will, other than a holographic to the witnesses, it shall be interpreted to
will, must be subscribed at the end thereof by them. Xxx
the testator himself or by the testator's name
written by some other person in his presence, ‘SUBSTANTIAL COMPLIANCE RULE’
and by his express direction, and attested • In the absence of bad faith, forgery, or fraud,
and subscribed by three or more credible or undue and improper pressure and
influence, defects and imperfections in the
witnesses in the presence of the testator and
form of attestation or in the language used
of one another.
therein shall not render the will invalid if it is
proved that the will was in fact executed and
The testator or the person requested by him attested in substantial compliance with all the
to write his name and the instrumental requirements of Article 805. (Art. 809)
witnesses of the will, shall also sign, as • What is imperative for the allowance of a will
aforesaid, each and every page thereof, despite the existence of omissions is that
except the last, on the left margin, and all the such omissions must be supplied by an
pages shall be numbered correlatively in examination of the will itself, without the need
letters placed on the upper part of each page. of resorting to extrinsic evidence. "However,
those omissions which cannot be supplied
The attestation shall state the number of except by evidence aliunde would result in
pages used upon which the will is written, the invalidation of the attestation clause and
and the fact that the testator signed the will ultimately, of the will itself.”
• An examination of the will in question reveals
and every page thereof, or caused some
that the attestation clause indeed failed to
other person to write his name, under his
state the number of pages comprising the will.
express direction, in the presence of the
• However, as was the situation in Taboada,
instrumental witnesses, and that the latter
this omission was supplied in the
witnessed and signed the will and all the Acknowledgment. It was specified therein that
pages thereof in the presence of the testator the will is composed of four pages, the
and of one another. Acknowledgment included. (MARGIE
SANTOS MITRA VS. PERPETUA L.
If the attestation clause is in a language not SABLAN--GUEVARRA, REMEGIO L.
known to the witnesses, it shall be interpreted SABLAN, ET AL. [G.R. No. 213994, April 18,
to them. (n) 2018 ])
Art. 806. Every will must be acknowledged Additional Requirements

before a notary public by the testator and the If deaf or deaf-mute, must either:
witnesses. The notary public shall not be 1. Read will personally, if able to do so;
2. Otherwise, he shall designate 2 persons to
required to retain a copy of the will, or file
read it & communicate to him the contents.
another with the Office of the Clerk of Court.
(Art 807 NCC)
If blind, will shall be read to him twice: 8. CONFLICT RULES

Once by one of the subscribing witnesses, and
 Please see also Articles 15, 16, 17 NCC
Again by the notary public before whom it is
and Renvoi under Persons and Family
acknowledged. (Art 808 NCC)
Relations
 If the error or ambiguity appears from the
In The Matter of the Petition for the Probate
context of the will or from extrinsic
of the Last Will and Testament of Cecilia
Esquerra Cosico, Thelma Esquerra Guia v evidence (intrinsic), mistakes and
Jose M. Cosico, Jr., Manuel M. Cosico, omissions must be corrected. This is
Minerva M. Cosico and Elanor M. Cosico- excluding the oral declarations of the
Chavez testator as to his intention.
G.R. No. 246997, MAY 5, 2021  If the ambiguity arises upon the face of
While the law imposes the requirement only the will (extrinsic), as to the application of
when the testator is blind, the Court has its provisions, the testator’s intention is to
expanded its coverage to those who are be ascertained from the words of the will,
illiterate. The case of Alvarado elucidates: “The taking into consideration the
rationale behind the requirement of reading the circumstances under which it was made.
will to the testator if he is blind or incapable of This also excludes the oral declarations
reading the will himself (as when he is illiterate), of the testator.
is to make the provisions thereof known to him,
so that he may be able to object if they are not in Art. 789. When there is an imperfect
accordance with his wishes. Clear from the description, or when no person or property
foregoing is that Art. 808 applies not only to blind exactly answers the description, mistakes and
testators but also to those who, for one reason omissions must be corrected, if the error
or another, are "incapable of reading their wills." appears from the context of the will or from
extrinsic evidence (intrinsic), excluding the
‘Holographic Will’ oral declarations of the testator as to his
• a will that is entirely written, dated and intention; and when an uncertainty arises upon
signed by the hand of the testator the face of the will (extrinsic), as to the
himself. application of any of its provisions, the
• It is important to know the date of execution
testator’s intention is to be ascertained from
because after the effectivity of the
the words of the will, taking into consideration
Spanish Civil Code, which was
the circumstances under which it was made,
overtaken by the Code of Civil
excluding such oral declarations.
Procedure August 7, 1901 – August
1950 – holographic wills, during that
period, were not allowed. Art. 788. If a testamentary disposition admits
• Strictly speaking, in notarial wills, of different interpretations, in case of doubt,
attestation clause is not part of the will that interpretation by which the disposition is to
because it contains no dispositions. The fact be operative shall be preferred.
that the attestation clause is typewritten will
not invalidate the will. Testacy is preferred to intestacy.
Requisites of valid holographic will Can oral declarations be used in

1. In writing; interpretation of wills?
2. Executed in a language or dialect known to No. It is expressly provided in the law that oral
the testator; declarations are excluded to be used in
3. Entirely written, dated & signed by the hand interpreting wills.
of the testator himself.
Because to do so would result in fraud, as the
words of a dead man can be distorted or
7. WITNESSES TO A NOTARIAL WILL perjured.
(QUALIFICATION AND
DISQUALIFICATIONS) The admission of oral declarations of the
Credible Witnesses testator as to his intention is expressly
1. Of sound mind; prohibited by law.
2. 18 years or more;
3. Not blind, deaf or dumb; This is to prevent prevarication by the
4. Able to read and write; witnesses whose testimony as to the oral
5. Domiciled in the Philippines; declarations of the testator may no longer be
6. Has not been convicted of falsification, disputed by the latter whose lips have been
perjury or false testimony. sealed by death.
GR: When the words of the will are clear, they b) Theory of Dependent Relative
shall be taken in their ordinary or grammatical Revocation
sense.
De Molo v Modo, et al. | GR No. L-2538,
XPN: It appears that the testator intended to
Sep. 21, 1951
give another meaning to them.
The revocation by destruction or overt act is
good only if the condition is fulfilled, namely,
GR: Words which are technical shall be
interpreted in their technical sense. the revoking will is valid. If, the condition not
fulfilled, the revocation by overt act did not
XPN: materialize.
a. When it indicates a contrary intention on
the part of the testator; or c) Revocation Based on a False Cause
b. It (satisfactorily) appears that the will was General Rule: A revocation of a will based
solely drafted by the testator, and he was on a false cause or an illegal cause is null
unacquainted with the technical sense of and void. (Art. 833, NCC)
the language used therein.
10. HEIRS
9. MODES OF REVOCATION OF WILLS
AND TESTAMENTARY DISPOSITIONS a) Compulsory Heirs
‘Compulsory Heirs’ defined
‘Revocation’ defined are persons who are not deprived of
an act of the mind terminating the potential their inheritance unless there are
capacity of a will to operate at the causes to disinherit them and the
death of the testator manifested by some causes are provided by law.
outward and visible act or sign symbolic
thereof. General Rule: If a compulsory heir
predeceases, is incapacitated or
Revocation
renounces or repudiates the inheritance,
1. By implication or operation of law
he transmits nothing to his own heirs.
• legal separation, annulment of marriage,
preterition, unworthiness
2. By overt act (burning, tearing, obliterating) XPN: Right of Representation
• Animus revocandi and corpus
3. By a revoking will or codicil b) Institution of Heirs
• new will must be valid ‘Institution of Heirs’ defined
• Institution of heirs is an act by virtue of
a) Effect on the Recognition of a Non- which a testator designates in his will the
Marital Child person or persons who are to succeed
Article 834. The recognition of an illegitimate him in his property and transmissible
child does not lose its legal effect, even rights and obligations
though the will wherein it was made should be • If designated without designation of
revoked. (741) shares, they shall inherit in equal parts
Under the Family Code, admission of Note:

illegitimate filiation in a will would constitute legitime must first be satisfied. Voluntary
proof of illegitimate filiation. Basically, the heirs can only receive the disposable free
principle laid down in Article 834 remains portion.
unaltered regarding these admissions
contained in wills. (1) Limitations on the Institution of Heirs
Will not containing an Institution of Heir
Rationale [Mison]: A will shall be valid even though it should not
The recognition does not lose its legal effect contain an institution of an heir, or such
even if the will is revoked, because the
institution should not comprise the entire
recognition is not a testamentary disposition, it
estate, and even though the person so
takes effect upon the execution of the will and
instituted should not accept the inheritance
not upon the death of the testator. Thus the
recognized natural child can demand his rights or should be incapacitated to succeed.
even if the will is revoked.
Rule for Testamentary Dispositions Article 959 of the Civil Code

In case a Will does not contain an Institution of “A disposition made in general terms in
Heir, the testamentary dispositions made in favor of the testator's relatives shall be understood
accordance with law shall be complied with and to be in favor of those nearest in degree.”
the remainder of the estate shall pass to the
legal heirs. (764) (3) Proscription Against Successive
Institution
Designation of Heir Effect When Testator Calls To Succession
a. The testator shall designate the heir by his • When the testator calls to the succession a
name and surname, and when there are two person and his children they are all deemed to
persons having the same names, have been instituted simultaneously and not
b. he shall indicate some circumstance by successively. (Art. 849, NCC)
which the instituted heir may be known.
c. Even though the testator may have omitted (4) Institution Based on a False Cause
the name of the heir, should he designate Article 833 of the Civil Code
him in such manner that there can be no “A revocation of a will based on false cause or an
doubt as to who has been instituted, the illegal cause is null and void.”
institution shall be valid. (Art. 843, NCC)
c) Substitution of Heirs
Effect of Error in Name (Art. 844, NCC) • Substitution of heirs is the appointment of
General Rule: An error in the name, surname, another heir, so that he may enter into the
or circumstances of the heir shall not vitiate the inheritance in default of the heir originally
institution when it is possible, in any other instituted.
manner, to know with certainty the person
instituted. Kinds
1. Simple or common;
Effect of Similarities in Name (Art. 844, NCC) 2. Brief or compendious;
General Rule: If among persons having the 3. Reciprocal;
same names and surnames, there is a similarity 4. Fideicommissary.
of circumstances in such a way that, even with
the use of other proof, the person instituted Appointment of Substitute Heirs
cannot be identified, none of them shall be an The testator may appoint one or more substitute
heir. heir or heirs instituted in case of:
a. Predecease
b. Renunciation
Effect of Institution Without Designation
c. Incapacity
Heirs instituted without designation of shares
shall inherit in equal parts (Art. 846, NCC)
(1) Causes of Substitution
Institution of Brothers and Sisters Purposes of Substitution
1.To avoid intestate succession;
General Rule: If the testator should institute his
2.To prevent the descent of the estate of the
brothers and sisters, and he has some of full
testator to whom the testator does not
blood and others of half blood, the inheritance
want to succeed him in his property whether by
shall be distributed equally right of representation, or by right of accretion or
XPN: a different intention appears. (Art. 848, by right of intestate succession;
NCC) 3.To allow the testator greater freedom to help
or reward those who by reasons of
Statement of a False Cause services rendered are more worthy of his
General Rule: shall be considered as not affection and deserving of his bounty
written; than intestate heirs;
XPN: it appears from the will that the testator 4.To enable the testator to make
would not have made such institution if he had arrangements for his succession in the
known the falsity of such cause. (Art. 850, NCC) manner most convenient for him;
5.To realize some honorable purpose of the
(2) Collective Institution testator like the maintenance of the property
• there is a disposition made in general within his property because in substitution,
terms in favor of the testator’s relatives the testator to some extent may preserve
• When the testator institutes some heirs the property within the confines of his
individually and others collectively. own immediate family and prevent the
estate from descending to the other legal
heirs like the brothers or sisters.
General Rule: Those collectively designated
• You can have a substitute for a
shall be considered as individually instituted.
legatee or devisee because Article 857
XPN: unless it clearly appears that the intention
applies to the free portion and not to the
of the testator was otherwise (Article 847, NCC) legitime
(2) Fideicommissary Substitution 11. LEGITIME

(Compared With Testamentary Trusts)
‘Legitime’ defined
Fideicommissary Substitution is that part of the testator’s property which he
A fideicommisary substitution is one by virture of cannot dispose of because the law has
which the fiduciary or first heirs is entrusted with reserved it for certain heirs who are called
the obligation to preserve and transmit to a compulsory heirs (Art 886)
second heir called the fideicommissary the
whole a part of the inheritance. The power to ‘Compulsory Heirs’ defined
appoint a fideicommissary substitute is also part are those for whom the law has reserved a
of the testator’s freedom of disposition. portion of the testator’s estate which is known
as the legitime.
Requisites of Fideicommissary Substitution 1. Legitimate children and descendants;
a. First heir (fiduciary) called to enjoy that 2. Surviving spouse;
estate and entrusted with the obligation to 3. Illegitimate children & descendants;
preserve and to transmit to a second heir 4. Legitimate parents & other legitimate
(fideicommissary) the whole or part of the ascendants;
inheritance. 5. Illegitimate parents
b. Second heir must not go beyond one
degree from the 1st heir How to Compute the Exact Amount of
c. Both must be living when testator died Legitime
d. Cannot burden the legitime. Article 908 of the Civil Code
“To determine the legitime, the value of the
The nullity of the fideicommissary substitution
property left at the death of the testator shall be
does not prejudice the validity of the institution of
considered, deducting all debts and charges,
the heirs first designated; the fideicommissary
which shall not include those imposed in the
clause shall simply be considered as not written.
will. To the net value of the hereditary estate,
[Article 868, NCC]
shall be added the value of all donations by the
Testamentary Trust testator that are subject to collation, at the time
A trust agreement created by will to take effect he made them.”
upon the death of the trustor. It involves the
management of properties and/or funds upon Steps in distribution of hereditary estate
death of testator, pending full distribution to 1. Gross value of the estate
beneficiaries subject to conditions set forth in the 2. Deduct debts and charges
trust. 3. Add to the net estate value of donation
inter vivos (collation)
A testamentary trust involves three parties. The 4. Determine legitime based on rules
grantor (testator) is the person who creates the 5. Impute donation inter vivos (collation),
trust in order to transfer his or her assets to the against the legitime if donee is a
beneficiary. The beneficiary is the person or compulsory heir, against the free portion
entity who is the recipient of the assets. The if stranger
trustee is the person appointed by the testator to 6. Distribute remaining after satisfaction of
handle the trust and manage the assets until the legitime based on will.
beneficiary takes over. Testamentary trust
expires once the beneficiary receives the assets Rules on Legitime
in accordance with the terms and conditions • Legitimate children always get ½ of estate
setforth by the grantor in the will. • Legitimate parents always get ½ (if not
excluded by legit child)
Fideicommissary Substitution as compared • No representation in the ascending line
to Testamentary Trusts • Legitime of spouse is same as 1 legit
Fideicommissary Substitution involves a two- child, except when there is only one child,
step inheritance process where assets are give ¼ taken from free portion
transferred first to a fiduciary heir (who acquired • Get legitime of illegitimate children from
usufruct over the property during his lifetime or free portion after surviving spouse is paid
during the period provided by the testator) and • NEVER REDUCE the legitime of
subsequently to a fideicommissary heir (who legitimate children and surviving spouse
acquired ownership thereof), while because they are the preferred
Testamentary Trusts involve the establishment compulsory heirs.
of a trust through a will to manage and distribute
• Legitime of illegitimate children will be
assets for the benefit of designated
reduced pro-rata and without preference
beneficiaries.
among them if the estate is insufficient
a) Collation in Connection With the Legitimate parents alone ½ remaining half is free
Computation of Legitime portion (Arts. 889, 890,
a. Adding NCC)
• Mathematical process of addition the value of
thing donated to the net value of the
Illegitimate parents ½
hereditary estate
alone
b. Charging
• Imputation of value of donation inter vivos
against either the legitim or disposable free Surviving spouse alone ½; ⅓; ½ (remaining half
portion depending on who is the done is free portion; Art.900,
c. Return NCC); reduced to ⅓ if
• The act of restoring to the common mass of marriage is in articulo
the hereditary estate, either actually or
mortis, and spouse who
fictitiously, any property or right, received by
gratuitous title (advance of legitime if was in articulo mortis
compulsory/ officious or inofficious donation) dies within 3 months
d. Not Collationable from marriage.
• Legacy or devise in favor of compulsory Unless, they have been
heir - charge to free portion not legitime living as husband and
• Donation inter vivos stated not wife for more than 5
collationable -charge to free portion not
years, spouse will still
legitime
• Expenses for support, education, medical get ½ legitime.
attendance - not to be considered in
computation of estate Legitimate children ½ (Divided by number of
alone legitimate children)
b) Table of Legitime Remainder is free
Legitime of Compulsory Heirs portion
One legitimate child ½
SURVIVING HEIR LEGITIME
(descendant)
Illegitimate children ⅓
Surviving spouse ¼
Surviving spouse ⅓ (Remaining ⅓ is free Remaining ¼ is free
portion; Art. 894, NCC) portion (Art. 892, NCC)
Illegitimate children ¼ Two or more legitimate ½ (Divided by number of

children (or their children)
Surviving spouse ⅛
descendants)
Legitimate parents ½
Surviving spouse Equal to the share of one
(Art. 899 NCC; testator
child remainder is free
may freely dispose of the
portion (Art. 892, NCC)
remaining ⅛ of the estate)
Illegitimate children ¼ Legitimate child ½
Legitimate parents ½ Illegitimate child ½ of each legitimate

child (Art.176, Family
Legitimate parents ½ Code)
Remainder is free
Surviving spouse ¼ (taken from the free portion (Art.892, NCC)
portion; Art. 893, NCC)
Illegitimate parents ¼ Brothers and sisters Not entitled to anything

Surviving spouse ¼ (nephews and nieces, in since they are not
case of deceased compulsory heirs;
Illegitimate children alone ½ (Divided by illegitimate siblings) Testator may choose to
children) give them something out
Remainder is a free of the free portion.
portion (Art. 901, NCC)
LEGITIME V. INTESTATE SHARE
SURVIVING HEIR LEGITIME INTESTATE SHARE

Illegitimate children 1/3 1/2
Surviving spouse 1/3 1/2
(Remaining 1/3 is free portion; Art.
894, NCC)
Legitimate parents 1/2 1/2
(Art. 899, NCC; testator may freely
dispose of the remaining 1/8 of the
estate.)
Surviving spouse 1/4 (taken from the free portion) 1/2
(Art. 893, NCC)
Illegitimate parents 1/4 1/2
Illegitimate children alone 1/2 (divided by number of All
illegitimate children)
Remainder is free portion (Art. 901,
NCC)
Legitimate parents alone 1/2; remaining half is free portion All
(Arts. 889 and 890, NCC)
Illegitimate parents alone 1/2 All
Surviving spouse alone 1/2; 1/3; 1/2 All
Legitimate children alone 1/2 (divided by number of legitimate All
children)
NCC)
One legitimate child (or 1/2 1/2
descendant) 1/4 1/2
Surviving spouse Remaining 1/4 is free portion (Art.
892, NCC)
Two or more legitimate children 1/2 (divided by the number of Consider spouse as one legitimate
(or their descendants) children) child and divide estate by total
Surviving spouse number
Equal to the share of one child
NCC)
Legitimate child 1/2 1 is to ½ or 2:1 or 10:5
Illegitimate child 1/2 of each legitimate child (Art.
176, Family Code)
NCC)
Surviving spouse 1/2 (remaining half is free portion; 1/2
Art. 900, NCC) 1/2 (divided by the number of
Brothers and sisters (nephews Not entitled to anything since they brothers and sisters; nephews and
and nieces, in case of deceased are not compulsory heirs; testator nieces of deceased siblings divide
siblings) may choose to give them among themselves the share that
something out of the free portion pertains to their parents)
Art. 1001, NCC
c) Impairment of the Legitime a) Requisites

 Heir is entitled for completion of legitime; Requisites of Preterition
 Legitime passes by operation of law. 1. The omission from the inheritance must be
 System of legitime is a limitation on a total or complete.
testator's power to dispose his estate in a No preterition in the following situations:
will. Legitime can never be impaired. a. If the compulsory heir is given a
 Compulsory heir may be denied of legitime devise or a legacy, he is not
only through a valid disinheritance. considered preterited even if the legacy
or devise is worth less than the
Article 907. Testamentary dispositions that legitime of the compulsory heirs.
impair or diminish the legitime of the compulsory b. If the estate is worth P100T but the testator
heirs shall be reduced on petition of the same, says, “I hereby institute my heir to one-half
insofar as they may be inofficious or excessive. of my estate.” That is the only provision
in the will.
Remedies in case of impairment of legitime • Ex. A is a son, an heir. There is no
[Mison]: Only compulsory heirs may resort to preterition even if A is not
these remedies precisely because these mentioned because something is
provisions are remedies in case of impairment of being left for A in the inheritance.
legitimes. c. As long as there is still a balance after all
1. Impairment by testamentary the provisions in the will have been
dispositions: If the impairment is total, given effect, there are still undisposed
then there may be preterition if the properties which the omitted compulsory
compulsory heir preterited is either an heir may partake so there is no preterition.
ascendant or descendant. Article 854
annuls the institution and, if inofficious as 2. The omitted heir must be a compulsory heir
when they impair legitime, legacies and in the direct line
devises are also reduced. If the impairment
is partial, then the compulsory heir is Compulsory heirs:
entitled to completion under Article 906 1. The children whether legitimate or
and reduction of testamentary dispositions illegitimate
under Article 907. 2. The parents in the absence of the children.
2. Impairment by donations: If the testator • A spouse is a compulsory heir but NOT in
has dissipated the estate through the the direct line
giving of donations inter vivos, then Article • By fiction of law, an adopted child is a
1061 shall be applicable where all compulsory heir in the direct line
donations inter vivos or dispositions made 3. The omitted compulsory heir must
during the testator’s lifetime shall be survive the testator.
collated back to the estate. • If the omitted heir died ahead of
the testator, there is no preterition
d) Presumptive Legitime because by reason of his early death, he is
‘An advance on the legitime given to the children deemed not to have inherited from the
upon the termination of their parents’ marriage testator. However, the omitted compulsory
by annulment or declaration of void marriages heir dies ahead and he has children
under Articles 50 and 51, in relation to Articles who can represent him.
40, and 45. • There is representation wherein the
• The delivery of presumptive Legitime shall be representative is exalted to the
without prejudice to the ultimate successional position of the one they are
rights of the children accruing upon death of representing. In this case, there is
the parents. preterition.
• If there was a donation given to the
12. PRETERITION compulsory heir during the lifetime of the
• Omission in the testator’s will of one, some or testator, and such heir is omitted from
all of the compulsory heirs in the direct line, the will, there is no preterition
whether living at the time of the execution of because he is not omitted from the
the will or born after the death of the testator. inheritance.
• Omitted heir is compulsory heir in the direct • There must be omission from the
line. inheritance, not merely from the will. The
• Omission must be total and complete in donations made to compulsory heirs during
character the lifetime of the testator, upon the death
• Annuls the institution of an heir of the testator, the values of these
• Does not affect devise and legacy if not donations are brought back to the value
inofficious. of the estate through collation.
b) Governing Law If the disposition is subject to a:

Article 854 of the Civil Code 1. Suspensive term – The legal heirs can
enjoy possession of the property until the
The preterition or omission of one, some, or
expiration of the period but they must put up
all of the compulsory heirs in the direct line, a bond (caucion muciana) in order to
whether living at the time of the execution of protect the right of the instituted heir.
the will or born after the death of the 2. Resolutory term – The legal heirs can
testator, shall annul the institution of heir; enjoy possession of the property but when
but the devises and legacies shall be valid the term arrives, he must give it to the legal
insofar as they are not inofficious. heirs. The instituted heir does not have to
file a bond.
Article 855 of the Civil Code
The share of a child or descendant omitted Effect of Condition to Disposition
in a will must first be taken from the part of • Conditions to affect the disposition must
the estate not disposed of by the will, if any; appear in the language of the will, and
if that is not sufficient, so much as may be cannot be presumed.
necessary must be taken proportionally • Parole evidence to prove the existence of
oral or other conditions cannot be allowed.
from the shares of the other compulsory
However, if the condition appeared in a
heirs. document incorporated by reference into the
will, it is proper to consider said condition.
13. CONDITIONAL DISPOSITIONS AND
DISPOSITIONS General Rule: No Charge, Condition or
Substitution on Legitimes (Art 872 & 905)
Effect of Impossible or Illegal Conditions XPN: The testator can validly impose a
Article 873 of the Civil Code prohibition against the partition of the legitime
Impossible conditions and those contrary to for a period not exceeding 20 years. (Art 1083)
law or good customs shall be considered • Art 1083 provides: Every co-heir has a right
to demand the division of the estate, unless
AS NOT IMPOSED and shall in no manner
the testator should have expressly forbidden
prejudice the heir, even if the testator
its partition, in which case the priod of
should otherwise provide. indivision shall not exceed 20 years as
provided in Art 494.
Explanation of Article 873 • This power of prohibition applies to legitime.
• Condition is void and unwritten BUT the • Even though forbidden by the testator, the
institution and testamentary disposition is co ownership terminates when any of the
valid Reason: in testamentary cause for which partnership is dissolved
disposition, the condition is not as takes place, or when the court finds for a
important as the generosity and liberality compelling reasons that division should be
of the testator. ordered, upon petition of one of the co-heirs.
• The impossible condition will just be
disregarded. Art 1183. a) Condition Not to Marry
• In obligations, when the condition is to do The Condition Not to Marry:
an impossible thing, both the condition (a) Absolute Prohibition
and the obligation are void. (1) To contract a 1st marriage Absolute void
and may be disregarded or considered
Effect of Vague Wording of Conditions not imposed Reason: contrary to good
• If a condition is so vaguely worded that morality and public policy
even after applying rules on construction (2) To remarry
• General Rule: It shall be void if it is
and interpretation, it is still meaningless,
contrary to morality and public policy
contradictory, or cannot be understood,
• XPN: valid
the conditions will be regarded as an When imposed on the widow or
impossible condition and should therefore widower by the deceased spouse
be disregarded. When imposed on the widow or
widower by the ascendants or
When is the time to be considered on descendants of the deceased spouse
whether a condition is impossible or (not the ascendants or descendant of
illegal? the widow or widower)
Time when the condition is supposed to be • Rationale: justified because of
fulfilled. sentimental and economic reasons.
(b) Relative Prohibition 3. “Modo” also signifies every onerous

(1) To contract a 1st marriage disposition by which the obligor imposed
(2) To remarry upon another and thus limited his
• Valid: relative prohibition to marry promise, such as demanding a loan in
a particular girl or at a particular exchange for what the other person
receives. The condition can be imposed
time or for a number of years
only on the free portion, never on the
• XPN: unless impossible or illegal
legitime (Art 904, CC)
• Invalid: when condition becomes
onerous or burdensome like don’t Occurrence of Modal Institution
marry for 60 years or don’t marry in This occurs when any or all of the following
Asia (the prohibition is actually an are stated:
absolute) (a) Object of the Institution
• Ex. I institute A as my heir to give him
(c) A stopping of a usufruct, allowance, enough money to obtain a legal
or personal prestation the moment the education.
heir, legatee, or devisee marries or
remarries – JUSTIFIED since the law (b) Application of the property left by the
allow their giving for the time during which testator
the person remains unmarried or in • Ex. I institute B as my heir. He will apply
widowhood the properties of the estate to the
erection of College of Law in Ortigas
b) Disposicion Captatoria Avenue.
(c) The charge imposed by the testator
Any disposition made upon the condition
• Ex. I institute A as my heir. He will
that the heir shall make some provision in devote 10% of the annual income from
his will in favor of the testator or of any my buildings for the establishment of
other person shall be void. professorial chain in Civil Law at the
University of Metropolis.
Note: Both the condition and disposition
are VOID. 14. VOID TESTAMENTARY
DISPOSITIONS
Rationale: This is also called legacy-
hunting disposition. It tends to make the 1) Every disposition in favor of an unknown
execution of a will a contractual act, hence, person
void. • XPN: by some event or circumstance his
identity becomes certain (Art. 845, NCC)
c) Modal Institution
‘Modal Institution’ defined 2) Any disposition made upon the condition
• Also called Institution Modal or that the heir shall make some provision in his
Institucion SubModo will in favor of the testator or of any other
person (Art. 875, NCC)
• Is not a condition but when and if it is
violated, the instituted heir is supposed
15. DISINHERITANCE
to forfeit the inheritance; to return indeed
‘Disinheritance’ defined
anything he may have received together • A compulsory heir may, in consequence of
with its fruits and interest, if he should disinheritance, be deprived of his legitime,
disregard this obligation. (Art. 882, NCC) for causes expressly stated by law.
Disinheritance can only be effected
Modal Institution through a will wherein the legal cause
1. When the institution of an heir is made, therefor shall be specified. (Arts. 913 & 916
for a certain purpose or cause (Art 871) NCC)
2. The statement of the object of the
institution or the application of the a) Grounds for Disinheritance
property left by the testator or the 1. Article 919 – children and other
charge imposed upon him (Art 882) – descendants
such statement shall not be considered 2. Article 920 – parents and other
a condition unless it appears that such ascendants
was the intention. 3. Article 921 – Spouse
[Sempio-Dy]
Of children, legitimate or Of parents, legitimate or Of Spouses (Art. 921) (6
illegitimate (Art. 919) (8 illegitimate (Art. 920) (8 grounds)
grounds) grounds, with 2,3,4,5 & 7 same
with Art. 919)
1. Conviction of attempt against - Same, Art. 920 (2)- - Same, Art. 921 (1) -
life of testator, his spouse,
descendant or ascendant.
2. Has accused testator of a - Same, Art. 920 (3)- - Same, Art. 921 (2) -
crime punishable by 6 yrs. or
more if found to be groundless.
3. Conviction of adultery or - Same, Art. 920 (4)- Art. 921 (4) - When he/she has
concubinage with testator's given ground for legal separation
spouse. (even if no case is filed).
4. Caused the testator to make a - Same, Art. 920 (5)- -Same, Art. 921 (3) -
will or change one already made
by fraud, violence, intimidation or
undue influence.
5. Refusal to support the testator Art. 920 (7) - Refusal to support Art. 921 (6) – Unjustified refusal
w/o justifiable cause. children and descendants w/o to support the children or other
justifiable cause spouse
6. Maltreatment of testator by Art. 920 (8) - Attempt against life
word or deed (conviction not of other parent, unless there is
necessary) reconciliation.
7. Leading dishonorable or Art. 920 (6) Loss of parental Art. 921 (5) - When spouse has
disgraceful life. authority for causes specified by given ground for loss of parental
law authority
8. Conviction of crime punishable Art. 920 (1) Abandonment of
by civil interdiction. children and descendants and
inducing daughters to live corrupt
or immoral lives or attempted
against their virtue
b) Requisites for the Various Grounds for

• But reconciliation extinguishes
Disinheritance
unworthiness as an incapacity, because
Requisites: incapacity is only the presumed will of the
1. Valid will; testator.
2. Compulsory heir is clearly identified;
• Revocation of will renders disinheritance
3. Based on cause/s sanctioned by law;
ineffectual.
4. Total; If partial, disinheritance is not valid,,
and the heir gets his or her legitime;
5. Unconditional; and 16. LEGACIES AND DEVISES
6. Cause is true & existing. Legacy and Devise Distinguished
• Legacy is a gift or bequest by will of
c) Effects of Reconciliation personal property, whereas a devise is a
• Subsequent reconciliation deprives the testator
of the right to disinherit, and any disinheritance testamentary disposition of real estate
already made becomes ineffectual. (Black’s Law Dictionary, 5th Ed.)
• Reconciliation needs no special form. It can be • A person who receives by will a gift of a
express or implied. In UNWORTHINESS (Art.
1033), condonation must be in writing.
specified item of personal property is a
• If ground for disinheritance is also a ground for legatee, while a devisee is one who
unworthiness, like abandonment of children or receives by will an individualized item of
an attempt against the life of the testator, the
real property. (Paguirigan)
heir cannot also inherit.
Who Has the Duty of Giving the Legacies ‘Alternative Legacies or Devises’ defined
and Devises? • One which provides that, among several
It depends. things mentioned, only one is to be given.
a. As a general rule, if no one is charged with [Article 940, NCC]
this duty, it is the estate which must give • The choice is with the heir, or the executor or
the legacies and devises. The estate is of administrator.
course represented by the executor, or the • If the heir, legatee, or devisee who is bound
administrator with a will annexed. to give the gift dies, the right passes to their
Note: heirs.
Under the Rules of Court, this officer is • The choice, once made, is irrevocable.
bound to discharge the devises and • Apply rules on obligations in general.
legacies. (Rule 81, Sec. 1{b}). As a matter
Legacy of generic property (Art. 941 NCC)
of fact, for this purpose of discharging, he
• Legacy of generic personal property is valid
may even be authorized by the court to
even if there are no things of the same kind in
alienate personal and real properties, in
the estate. The estate will simply have to
order to obtain the money or things acquire what is given by legacy.
needed. (See Secs. 1 and 2, Rule 81, • But devise of indeterminate real property is
Rules of Court). valid only if there is an immovable property of
the same kind in the estate at the time of
b. If the testator gives this duty to the testator’s death.
compulsory heirs, or to the legatees and • The right to choose the legacy belongs to the
devisees, they must comply with their executor or administrator who shall deliver a
duties, subject to the limitations imposed thing which is neither of inferior or superior
by law. quality.
Note: • If the choice is given to the heir, legatee, or
The testator is allowed to charge them with devisee, he may choose whatever he prefers
this duty because the right to dispose (need not be of medium quality) (Art. 942).
presumes the right. • If the heir, legatee, or devisee cannot make
the choice, the right passes to his heirs (Art.
Legacy or Devise of Encumbered Property 943)
Art. 934. If the testator should bequeath or • Finality of choice – irrevocable, once made.
devise something pledged or mortgaged to
secure a recoverable debt before the Legacy for Education (Article 944 NCC)
execution of the will, the estate is obliged to • Lasts until the legatee is of age, or beyond
pay the debt, unless the contrary intention the age of majority in order that he may finish
appears. The same rule applies when the thing some professional, vocational, or general
is pledged or mortgaged after the execution of course, provided he pursues his course
the will. Any other charge, perpetual or diligently.
temporary, with which the thing bequeathed is
Amount
burdened, passes with it to the legatee or
• that fixed by the testator; If the testator did not
devisee. If the thing bequeathed should be
fix the amount, it is fixed in accordance with
subject to a usufruct, the legatee or devisee
the social standing and circumstances of the
shall respect such until it is legally
legatee and the value of the estate.
extinguished. (Art 946 NCC)
Legacy of support (Article 944 NCC)
Legacy of Credit • It lasts during the lifetime of the legatee.
Art. 935. The legacy of a credit against a third • If the testator used to give the legatee a sum
person or of the remission or release of a debt of money for support, give same amount,
of the legatee shall be effective only as unless it is markedly disproportionate to the
regards that part of the credit or debt existing estate.
at the time of the death of the testator. • If the testator did not fix the amount, consider
the social standing and circumstances of the
In the first case, the estate shall comply with legatee and the value of the estate.
the legacy by assigning to the legatee all rights
of action it may have against the debtor. In the Order of Payment of Legacies and Devises if
second case, by giving the legatee an estate is not sufficient
acquittance, should he request one. 1. Remuneratory
• Those which testator gives because of his
In both cases, the legacy shall comprise all moral obligation to compensate certain
interests on the credit or debt which may be persons for services which do not
due the testator at the time of his death. constitute recoverable debts, like legacy to
one who saved the life of the testator.
• Entitled to preference because they are c) Ineffective Legacies/Devises

moral obligations of the testator. Legacy or Devise shall be without effect:
2. Those declared by the testator as (1) Transformation - If the testator transforms
preferential. the thing such that it does not retain its
3. For support original form or denomination;
4. For education. (2) Alienation - If the testator alienates the
5. Legacy or devise of specific, determinate thing by any title or for any cause.
thing in the estate. Reacquisition of the thing by the testator
6. Others, pro rata. (Art 950 NCC) does not make the legacy or devise valid,
• Mistake as to name of thing given is of no unless it is effected by right of repurchase
consequence, if thing can be identified. (Art. (pacto de retro) OR reversion is caused by
958 NCC)
the annulment was vitiation of consent on
the grantor’s part, either by reason of
Acceptance or Repudiation of legacy or
incapacity or of duress.
devise:
(3) Total loss - If the thing is totally lost during
General Rule: Acceptance may be total or
the lifetime or after the death of the
partial.
testator.
XPN: If the legacy/devise is partly onerous and
partly gratuitous, the recipient can not accept the
gratuitous part and renounce the onerous part. C. INTESTATE SUCCESSION
Any other combination however is permitted.
• Heirs of legatee or devisee can accept the gift ‘Legal Succession’ defined
if the legatee or devisee dies after the death of That kind of succession prescribed by law (and
the testator, not before. presumed by it to be the desire of the deceased)
• Legacy or devise not accepted shall be which takes place when the expressed will of the
merged into the mass of the estate (intestacy), decedent has not been set down in a will.
except in substitution or accretion (Art 956
NCC). It takes place when:
• If a compulsory heir is also a legatee or • When a person dies without a will or a void
devisee, he can accept either or both the will, or a will that has lost its efficacy (like a
legacy/devise and the legitime, or waive both revoked will);
(Art. 955 NCC). • When the will does not institute an heir or
does not dispose of all the properties of the
a) Requisites for Validity testator (partial intestacy). In such case, legal
1. The will must be valid succession shall take place only with respect
2. The thing must be within the commerce of to the property of which the testator has not
man. (Art. 924) disposed;
3. The thing must be owned by the testator, • If a suspensive condition attached to the
and not by another person (Art. 930) institution of heir in a will does not happen or
XPN: Thing owned by the stranger is still is not fulfilled, or if the heir dies before the
valid if there is an order to acquire the testator, or repudiates the inheritance, there
same (Art. 930-931) being no substitution, and no right of
accretion takes place;
b) Property Not Owned by the Testator • If the heir predeceases the testator, or is
General Rule: The legacy or devise of a thing incapacitated to inherit, or repudiates the
belonging to another person is void, if the testator inheritance, and there is no substitution or
erroneously believed that the thing pertained to accretion;
him. • When the heir instituted is incapable of
XPN: If the thing bequeathed, though not succeeding;
belonging to the testator when he made the will, • Upon the expiration of a resolutory term
afterwards becomes his, by whatever title, the attached to the institution of heir;
disposition shall take effect. (Art. 930, NCC) • Upon fulfillment of a resolutory condition
attached to the institution of heir, rendering
Acquisition of Thing Belonging to Another the will ineffective.
General Rule: If the testator orders that a thing • Preterition
belonging to another be acquired in order that it
be given to a legatee or devisee, the heir upon 1. RELATIONSHIP
whom the obligation is imposed or the estate Who are intestate heirs?
must acquire it and give the same to the legatee Direct and Collateral relatives
or devisee; 1. Legitimate children or descendants
XPN: If the owner of the thing refuses to alienate 2. Illegitimate children or descendants
the same, or demands an excessive price 3. Legitimate parents or ascendants
therefor, the heir or the estate shall only be 4. Illegitimate parents
obliged to give the just value of the thing. (Art. 5. Surviving spouse
931, NCC)
c. In the collateral line, representation takes

6. Brothers and sisters, nephews and nieces
7. Other collateral relatives up to the 5th place only in favor of children of brothers and
sisters, whether full or half blood (Art. 972,
degree
8. The State. second par.). Hence, grandnephews and
grandnieces do not represent.
Degrees of Relationship d. There is representation in favor of the
Article 963 of the Civil Code adopted (see Sections 41 and 43 of new law
“Proximity of relationship is determined by the RA 11642)
number of generations. Each generation forms a • Section 43 In testate and Intestate
degree.” succession, the adopters and the adoptee
shall have reciprocal rights of succession
‘Full or Half Blood Relationship’ defined without distinction from legitimate filiations.
Full blood relationship is that existing between However, if the adoptees and their
persons who have the same father and the biological parents have left a will, the law
on testamentary succession shall govern.
same mother. Half blood relationship is that
existing between persons who have the same • Section 41 Legitimacy. – The adoptee shall
be considered the legitimate child of the
father, but not the same mother, or the same
adopter for all intents and purposes and as
mother, but not the same father. [Article 967,
such is entitled to all the rights and
NCC]
obligations provided by law to legitimate
children born to them without
Right of Representation
discrimination of any kind. To this end, the
It is “a right created by fiction of law, by virtue of
adoptee is entitled to love, guidance, and
which the representative is raised to the place
support in keeping with the means of the
and degree of the person represented, and
family. The legitimate filiation that is
acquires the rights which the latter would have if
created between the adopter and the
he were living or if he could have inherited.”
adoptee shall be extended to the adopter’s
(Article 970, NCC)
parents, adopter’s legitimate siblings, and
legitimate descendants. The adopter is
When does representation exist
also given the right to choose the name by
a) In testate succession:
which the child is to be known, consistent
• Exists in predecease, incapacity, and
with the best interest of the child.
disinheritance.
e. The representative must himself be capable
• Covers only the legitime, which goes to the
of succeeding the decedent (Art. 973).
representative by operation of law.
f. The representative must at least be
• There is no right to represent a voluntary
conceived at the time succession opens.
heir.
g. When there is representation, the heirs inherit
b) In intestate succession:
per stirpes, not per capita (Art. 974). That is,
• Exists also in predecease and incapacity.
all those in a group inherit in equal shares,
• Covers all that the person represented
because per stirpes means inheritance by
could have inherited.
group.
h. A renouncer may not be represented but he
Lines where representation obtain
can represent the person whose inheritance
• With respect to the legitime
he has renounced.
 in the direct descending line only (Article
i. Illegitimate children may represent their
972, NCC)
legitimate parents (Art. 922), as exception to
the iron-curtain rule – see G.R. Nos. 208912
• With respect to intestacy –
and 209018, Aquino v. Aquino, December 7,
1. in the direct descending line (Article 972,
2021
NCC)
j. When nephews and nieces survive with
2. in one instance in the collateral line; i.e.
brothers or sisters, they inherit by
nephews and nieces representing
representation. If they alone survive, they
brothers and sisters of the deceased.
inherit in equal portions or per capita.
(Article 975, NCC)
Rules to remember 2. CAUSES OF INTESTACY

a. The representative succeeds not the person Legal or intestate succession takes place:
represented but the one whom the person 1. If a person dies without a will, or with a void
represented would have succeeded (Art. will, or one which has subsequently lost its
971). validity;
b. The right of representation takes place only in 2. When the will does not institute an heir to, or
the direct descending line: never in the dispose of all the property belonging to the
ascending line (Art. 972). testator. In such case, legal succession shall
take place only with respect to the property
of which the testator has not disposed.
3. If the suspensive condition attached to the (m) Surviving spouse and illegitimate parents –
institution of heir does not happen or is not 1/2, 1/2
fulfilled, or if the heir dies before the testator,
or repudiates the inheritance, there being no (n) Illegitimate parents alone – All.
substitution, and no right of accretion takes
place; (o) Surviving spouse, brothers and sisters – 1/2,
4. When the heir instituted is incapable of 1/2
succeeding, except in cases provided in this
Code. (Art. 960, NCC) (p) Brothers and sisters, nephews and nieces –
All.
3. ORDER OF INTESTATE SUCCESSION
I. Legitimate Children/Descendants (q) Other collaterals – All.
II. Illegitimate Children/Descendants Nearer excludes the farther.
III. Legitimate Parents/Ascendants Does not extend beyond 5th degree.
IV. Illegitimate Parents A half-sister excludes all other relatives.
V. Surviving Spouse
VI. Brothers, sisters, nephews, nieces (r) State – All
VII. Other Collaterals – to the 5th degree
VIII. State Important Rules in Legal Succession
Intestacy
Sharing in Intestate Succession [Sempio-Dy] Exclusion and Concurrence
Intestacy operates on the same principles as
(a) Legitimate children alone – All succession to the legitime. There are two
principles, operating sometimes simultaneously,
(b) Legitimate children – Surviving spouse – SS sometimes singly: exclusion and concurrence.
gets the same share as one legitimate child. If
there is only one child, they divide 1/2, 1/2. I. Legitimate children:
1. Exclude parents, collaterals & State
(c) Legitimate children and illegitimate children – 2. Concur with surviving spouse and illegitimate
Proportion of 10-5, provided the legitimes of the children
legitimate children are not impaired. 3. Are excluded by no one
(d) Legitimate children – illegitimate children – II. Illegitimate children:

surviving spouse: 1. Exclude illegitimate parents, collaterals &
Legitimate children and illegitimate children – State
Proportion of 10-5 2. Concur with surviving spouse, legitimate
Surviving spouse – Same share as one children, & legitimate parents
legitimate child 3. Are excluded by no one
(e) One legitimate child – surviving spouse – III. Legitimate parents

illegitimate children: 1. Exclude collaterals & State
One legitimate child - 1/2 2. Concur with illegitimate children & surviving
Surviving spouse - 1/4 spouse
Illegitimate children - 1/4 3. are excluded by legitimate children
(f) Illegitimate child alone – All. IV. Illegitimate parents

1. Exclude collaterals & State
(g) Illegitimate children and surviving spouse – 2. Concur with surviving spouse
1/2, 1/2 3. Are excluded by legitimate children &
illegitimate children
(h) Surviving spouse alone – All.
VI. Brothers and Sisters, Nephews and
(i) Legitimate parents alone – All. Nieces
1. Exclude all other collaterals & the State
(j) Legitimate parents, surviving spouse, 2. Concur with surviving spouse
illegitimate children – 1/2, 1/4, 1/4. 3. Are excluded by legitimate children,
***Remember that when there are legitimate illegitimate children, legitimate parents, and
children, ascendants are excluded. illegitimate parents
(k) Legitimate parents and illegitimate children – VII. Other Collaterals

1/2, 1/2 1. Exclude collaterals in remoter degrees & the
state
(l) Legitimate parents and surviving spouse – 2. Concur with collaterals in the same degree.
1/2, 1/2
3. Are excluded by legitimate parents, • In partial intestacy, legacies and devisees

illegitimate parents, surviving spouse, are charged to the free portion
brothers & sisters, and nephews & nieces. proportionately against the heirs who are
given more than their legitimes, but in no
VIII. State case shall the legitimes be impaired.
1. Excludes no one • Grandchildren always inherit by
2. Concurs with no one representation whether they concur with
3. Is excluded by every one the children or not. They inherit in their
own right only when all the children
4. RULE OF PROXIMITY AND RULE OF renounce, and they share equally or per
EQUALITY capita (Art. 982).
The Rule of Proximity of Degree
Relatives nearer or nearest in degree exclude 5. DETERMINATION OF HEIRS
the more distant ones, saving the right of Intestate Heirs, just like compulsory heirs, are
representation when proper (Article 962, NCC). determined by law.
The Rule of Preference of Lines – The three Treyes v Larlar

lines of relationship are: G.R. No. 232579, September 08, 2020
1) the descending;
2) the ascending; and Facts:
3) the collateral. • Dr. Nixon Treyes's (Dr. Nixon) wife Rosie
The law lays down an order of preference Larlar Treyes passed away without having
among these lines, such that the descending any children and without leaving a will.
excludes the ascending and the collateral, and Antonio, Emilio, Heddy, Rene, Celeste, Judy,
the ascending excludes and collateral. and seven siblings whom Rosie left behind
(Larlar, et al.). Rosie had 14 real estate
The Rule of Equality among Relatives of the properties under marital ownership with Dr.
same Degree - Relatives in the same degree Nixon at the time of her passing. Afterwards,
inherit in equal shares. Except: Dr. Nixon signed two affidavits of self-
1) the rule of preference of lines, supra; adjudication in which he claimed to be the
2) the distinction between legitimate and only heir and transferred Rosie's inheritance
illegitimate filiation (the ratio is 2:1) to himself. Larlar, et al. thus filed a complaint
3) the rule of division by line in the ascending with the RTC seeking the nullification of the
line (Article 987, par. 2) affidavits, the cancellation of TCTs, the
4) the distinction between full or half-blood reconveyance of ownership and possession,
relationship among brothers and sisters, as the partition, and damages.
well as nephews and nieces (Arts. 1006 and • Meanwhile, Dr. Nixon submitted a motion to
1008) dismiss the case on a number of grounds,
5) Representation including lack of subject-matter jurisdiction
and consequently a lack of real parties in
a) Exceptions to the Rule of Proximity interest since there is no court declaration of
and Rule of Equality heirship yet in favor of Larlar et al.
1. The rule of preference of lines, supra; • After the RTC rejected the Omnibus Motion,
2. The distinction between legitimate and Treyes petitioned the Court of Appeals (CA)
illegitimate filiation (the ratio is 2:1) for certiorari in accordance with Rule 65.
3. The rule of division by line in the ascending However, the CA rejected this. Thus, the
line (Article 987, par. 2) current petition.
4. The distinction between full or half-blood
relationship among brothers and sisters, as Issue:
well as nephews and nieces (Arts. 1006 and Whether a prior determination of the status as a
1008) legal or compulsory heir in a separate special
5. Representation proceeding is a prerequisite to an ordinary civil
• An intestate heir is not necessarily a action seeking for the protection and
compulsory heir (like a brother or sister). enforcement of ownership rights given by the
• Illegitimate children do not inherit ab law of succession.
intestato from the legitimate children and
relatives of his father or mother; nor do said Ruling:
legitimate children and relatives inherit from No. In the instant case, it is readily apparent
the illegitimate child (Art. 992). from the allegations in the Complaint filed by the
• There is also reserva troncal in legal private respondents that the action was not
succession, because legal succession is by instituted for the determination of their status as
operation of law. heirs, as it was their position that their status as
• A renouncer can represent but cannot be heirs was already established ipso jure without
represented (Arts. 976, 977). the need of any judicial confirmation.
Instead, what the Complaint alleges is that Before one can file an ordinary civil action to
the private respondents' rights over the enforce ownership rights acquired by virtue of
subject properties, by virtue of their being succession, is abandoned.
siblings of the deceased, must be enforced
Henceforth, the rule is: unless there is a pending
by annulling the Affidavits of Self-
special proceeding for the settlement of the
Adjudication and ordering the reconveyance
decedent's estate or for the determination of
of the subject properties. heirship, the compulsory or intestate heirs may
commence an ordinary civil action to declare the
The private respondents do not really seek nullity of a deed or instrument, and for recovery
in their Complaint the establishment of their of property, or any other action in the
rights enforcement of their ownership rights acquired
as intestate heirs but, rather, the by virtue of succession, without the necessity of
enforcement of their rights already granted a prior and separate judicial declaration of their
by law as intestate heirs finds basis in Article status as such. The ruling of the trial court shall
777 of the Civil Code, which states that the only be in relation to the cause of action of the
ordinary civil action, i.e., the nullification of a
rights of succession are transmitted from the
deed or instrument, and recovery or
moment of the death of the decedent.
reconveyance of property, which ruling is
binding only between and among the parties.
Hence, subject to the required proof, without
any need of prior judicial determination, the 6. SUCCESSIONAL BARRIER (THE “IRON
private respondents siblings of Rosie, by CURTAIN RULE”) (SEE AQUINO V.
operation of law, are entitled to one-half of AQUINO, G.R. NOS. 208912 AND 209018,
the inheritance of the decedent. Thus, in DECEMBER 7, 2021)
filing their Complaint, they do not seek to Iron Curtain Rule
have their right as intestate heirs • embodied in Article 992 of the Civil Code,
established, for the simple reason that it is creates an absolute bar that operates
the law that already establishes that right. bilaterally.
What they seek is the enforcement and • It prohibits an illegitimate child to succeed
protection of the right granted to them under intestate from the legitimate descendants,
Article 1001 in relation to Article 777 of the and collateral relative of his legitimate parent,
and vice versa.
Civil Code by asking for the nullification of
the Affidavits of Self-Adjudication that
AQUINO V. AQUINO | G.R. Nos. 208912
disregard and violate their right as intestate
and 209018, December 7, 2021
heirs.
Whether or not a nonmarital grandchild may
inherit ab intestato from his or her marital
Given the clear dictates of the Civil Code grandparent by right of representation.
that the rights of the heirs to the inheritance
vest immediately at the precise moment of Ruling
the decedent's death even without judicial Yes, a nonmarital grandchild may inherit ab
declaration of heirship, and the various intestato from his or her marital grandparents by
Court En Banc and Division decisions right of representation.
holding that no prior judicial declaration of
heirship is necessary before an heir can file In In re Grey, this Court cited the commentaries
of the Spanish civilist Manresa in explaining the
an ordinary civil action to enforce ownership
philosophy behind the prohibition in Article 992:
rights acquired by virtue of succession
through the nullification of deeds divesting Between the natural child and the legitimate
property or properties forming part of the relatives of the father or mother who
estate and reconveyance thereof to the acknowledged it, the Code denies any right of
estate or for the common benefit of the heirs succession. They cannot be called relatives and
of the decedent, the Court hereby resolves they have no right to inherit. Of course, there is a
to clarify the prevailing doctrine. blood tie, but the law does not recognize it. It is
based upon the reality of the facts and upon the
Accordingly, the rule laid down in Ypon, presumptive will of the interested parties; the
Yaptinchay, Portugal, Reyes, Heirs of natural child is disgracefully looked down upon
by the legitimate family; the legitimate family is,
Gabatan v. Court of Appeals, and other
in turn, hated by the natural child; the latter
similar cases, which requires a prior
considers the privileged condition of the former
determination of heirship in a separate and the resources of which it is thereby
special proceeding as a prerequisite. deprived; the former, in turn, sees in the natural
child nothing but the product of sin, a palpable This Court abandons the presumption in In re
evidence of a blemish upon the family. Every Grey, Corpus, Diaz, and In re Suntay, among
relation is ordinarily broken in life; the law does no others, that nonmarital children are products of
more than recognize this truth, by avoiding further illicit relationships or that they are automatically
grounds of resentment. placed in a hostile environment perpetrated by
the marital family. We are not duty bound to
Article 992 carves out an exception to the general
uncritically parrot archaic prejudices and
rule that persons, by operation of law, inherit
cruelties, to mirror and amplify oppressive and
intestate from their blood relatives up to a certain
degree. It does so through a classification of
regressive ideas about the status of children
persons based on their birth status. The and family life. The best interest of the child
classification created in Article 992 is made upon should prevail.
persons at their conception and birth—when they
are children. This Court has recognized that the alleged
resentment and hostility presumed by Article
Intestate succession is based on the decedent's 992 can be proven by evidence to be non-
presumed will. Article 992 then assumes that the existent. Particular facts of a case may show
decedent's disposition of their property would not that the decedent's will does not distinguish
have included any nonmarital children, due to a between marital and nonmarital relatives,
supposed hostility between the marital family and precluding a rigid application of Article 992.
the nonmarital child because the latter was the
outcome of an extramarital affair. This Court abandons the presumption in In re
Grey, Corpus, Diaz, and In re Suntay, among
However, a nonmarital child is not defined that
others, that nonmarital children are products of
way. Nonmarital children, or "illegitimate
children" as used under Article 165 of the
illicit relationships or that they are automatically
Family Code, are "children conceived and placed in a hostile environment perpetrated by
born outside a valid marriage”. the marital family. We are not duty bound to
uncritically parrot archaic prejudices and
The phrase "outside a valid marriage" does not cruelties, to mirror and amplify oppressive and
necessarily mean an extramarital affair. regressive ideas about the status of children
and family life. The best interest of the child
Parents may choose not to get married despite should prevail.
having no legal impediment to marry.
Applying Article 982 in situations where the
If there is a legal impediment, it does not grandchild's right to inherit from their
necessarily follow that the impediment is that grandparent is in issue is more in accord with
either or both parents are married to another our State policy of protecting children's best
person. It is entirely possible that one or both of
interests and our responsibility of complying
them are below marriageable age.
with the United Nations Convention on the
Another reason why a child could have been born
Rights of the Child.
"outside a valid marriage" is because their mother
was a victim of sexual assault who did not marry To emphasize, this ruling will only apply when
the perpetrator. the nonmarital child has a right of
representation to their parent's share in her
There are also times when the father of an unborn grandparent's legitime. It is silent on
child may have died before being able to marry collateral relatives where the nonmarital
the child's mother, as what has been alleged in child may inherit by themself. We are not
Angela's case. now ruling on the extent of the right of a
nonmarital child to inherit in their own right.
Children born from these circumstances are also Those will be the subject of a proper case and,
considered "illegitimate." Yet, there may be no if so minded, may also be the subject of more
"antagonism or incompatibility," "hate," or enlightened and informed future legislation.
"disgraceful looks" to speak of. If Article 992
merely recognizes existing conditions, then it
should be construed to account for other
circumstances of birth and family dynamics.
“Both marital and nonmarital children, whether
born from a marital or nonmarital child, are
This Court has recognized that the alleged blood relatives of their parents and other
resentment and hostility presumed by Article 992 ascendants.” Thus, a nonmarital child’s right of
can be proven by evidence to be non-existent. representation should be governed by Article
Particular facts of a case may show that the 982 of the Civil Code, which does not
decedent's will does not distinguish between differentiate based on the birth status of
marital and nonmarital relatives, precluding a rigid grandchildren and other direct descendants.
application of Article 992.
7. SUCCESSIONAL RIGHTS OF ADOPTED 10. SUCCESSIONAL RIGHTS OF THE

CHILDREN SURVIVING SPOUSE
& Surviving Spouse
8. SUCCESSIONAL RIGHTS OF ADOPTING 1. Excludes collaterals other than brothers,
PARENTS sisters, nephews & nieces, and the State
2. Concurs with legitimate parents, illegitimate
REPUBLIC ACT NO. 11642, January 06, 2022 parents, bothers, sisters, nephews & nieces
(R.A. 11642) 3. Is excluded by no one
Section 41. Legitimacy. – the adoptee shall 11. SUCCESSIONAL RIGHTS OF

be considered the legitimate child of the COLLATERAL RELATIVES
adopter for all intents and purposes and as Other Collaterals
such in entitled to all the rights and obligations Up to 5th Civil Degree
provided by law to legitimate children born to 1. Exclude collaterals in remoter degrees & the
them without discrimination of any kind. To this State
end, the adoptee is entitled to love, guidance, 2. Concur with collaterals in the same degree
and support in keeping with the means of the 3. Are excluded by legitimate children,
family. The legitimate filiation that is created illegitimate children,. Legitimate parents,
between the adopter and adoptee shall be illegitimate parents, surviving spouse,
extended to the adopter’s parents, adopter’s brothers & sisters, and nephews & nieces.
legitimate siblings, and legitimate descendants.
D. PROVISIONS COMMON TO
The adopter is also given the right to choose TESTATE AND INTESTATE
the name by which the child is to be known, SUCCESSION
consistent with the best interest of the child.
1. CAPACITY TO SUCCEED
Section 43. Succession. – In testate and
intestate succession, the adopters and the In order that a person can inherit either by will or
adoptee shall have reciprocal rights of by intestacy, the following requisites must
succession without distinction from legitimate concur:
filiations. However, if the adoptees and their A. Heir, legatee or devisee must be living or in
biological parents have left a will, the law on existence at the moment succession opens;
testamentary succession shall govern. B. That such heir, legatee or devisee must not
be incapacitated or disqualified by law to
succeed.
9. SUCCESSIONAL RIGHTS OF MARITAL
AND NON-MARITAL CHILDREN
Kinds of Incapacity
• Non Marital child (illegitimate) when
concuring with a marital (legitimate child)
A) Incapacity by Reason of Unworthiness
will receive half of the legitime/intestate
and Effects of Condonation
share of a marital child.
Article 1032. The following are incapable of
Article 982 of the Civil Code succeeding by reason of unworthiness:
“The grandchildren and other descendants 1. Parents who have abandoned their children
shall inherit by right of representation, and if or induced their daughters to lead a corrupt
any one of them should have died, leaving or immoral life, or attempted against their
several heirs, the portion pertaining to him virtue;
shall be divided among the latter in equal 2. Any person who has been convicted of an
portions.” attempt against the life of the testator, his or
her spouse, descendants, or ascendants;
Explanation of Article 982 3. Any person who has accused the testator of
• It does not make any distinctions or a crime for which the law prescribes
qualifications as to the birth status of the imprisonment for six years or more, if the
"grandchildren and other descendants" accusation has been found groundless;
granted the right of representation. 4. Any heir of full age who, having knowledge
• To allow grandchildren and other of the violent death of the testator, should fail
descendants, regardless of their birth to report it to an officer of the law within a
status, to inherit by right of representation month, unless the authorities have already
will protect the legitime of the compulsory taken action; this prohibition shall not apply
heir they represent; otherwise, the legitime to cases wherein, according to law, there is
no obligation to make an accusation;
will be impaired, contrary to protections
5. Any person convicted of adultery or
granted to this legitime in other areas of our
concubinage with the spouse of the testator;
law on succession. (Aquino v Aquino)
6. Any person who by fraud, violence, c. A guardian with respect to testamentary

intimidation, or undue influence should dispositions given by a ward in his
cause the testator to make a will or to favor before approval of guardian’s final
change one already made; accounts
7. Any person who by the same means • XPN: when the guardian is the compulsory
heir of the ward, in which case the disposition
prevents another from making a will, or
is VALID
from revoking one already made, or who
• XPN: Relatives of the guardian.
supplants, conceals, or alters the latter’s
will; d. Any attesting witness to the
8. Any person who falsifies or forges a decedent’s will, and his/her spouse,
supposed will of the decedent. (756, 673, children, and parents.
674a) • XPN: brother, sister, grandchildren, and
other descendants of the attesting witness
Cause of unworthiness is without effect if
there is condonation (Art. 1033): e. Any physician, surgeon, nurse, health
• Implied condonation: officer or druggist who took care of the
- If, having knowledge of the act of testator during his last illness
• Care should be continuing or regular,
unworthiness, the testator gave the
not isolated service
person concerned an inheritance,
• XPN: Relatives of the health workers.
legacy or devise.
• Express condonation: f. Individuals, associations, and
- If, not knowing of the act of corporations not permitted by law to
unworthiness at the time of the inherit.
execution of the will, but having known
of the same subsequently, the testator This incapacity does not include the legitime or
condones it in writing, public or private. intestacy, because heirs inherit by law.
b) Incapacity by Reason of Morality 2. RIGHT OF REPRESENTATION IN

1. Spouse who committed adultery or TESTACY AND INTESTACY
concubinage ‘Right of Representation’ defined
• there need no criminal conviction It is “a right created by fiction of law, by virtue of
• as long as you can prove which the representative is raised to the place
and degree of the person represented, and
2. Concubine
acquires the rights which the latter would have if
3. Those made between persons who he were living or if he could have inherited.”
committed the same criminal offense, in (Art. 970, NCC)
consideration thereto [Arts. 739 and
1028, NCC) When Does Representation Exist
a) In testate succession:
c) Incapacity by Reason of Possible • Exists in predecease, incapacity, and
Undue Influence disinheritance.
a. The priest who heard the last • Covers only the legitime, which goes to the
confession of the testator during his representative by operation of law.
last illness, or the minister of the gospel • There is no right to represent a voluntary
who extended spiritual aid to him during heir.
b) In intestate succession:
the same period;
• Exists in predecease and incapacity.
 referring only to the free portion and not • Covers all that the person represented could
the legitime of the heir have inherited.
 XPN: if the priest is a compulsory
heir of the decedent, we cannot Lines where representation obtain
take away their legitime. Only his • With respect to the legitime:
share from free portion will be taken in - in the direct descending line only (Art. 972)
case of undue influence. • With respect to intestacy:
1. in the direct descending line (Art. 972)
b. The relatives of such priest or minister 2. in one instance in the collateral line; i.e.
of the gospel within the fourth degree, nephews and nieces representing brothers
the church, order, chapter, community, and sisters of the deceased. (Art. 975)
organization, or institution to which such
priest or minister may belong.
a) Requisites and Limitations 3. RIGHT OF ACCRETION IN

Rules to Remember TESTAMENTARY SUCCESSION AND IN
a. The representative succeeds not the person INTESTACY
represented but the one whom the person ‘Accretion’ defined
represented would have succeeded (Art. It is a right by virtue of which, when two or more
971). persons are called to the same inheritance,
b. The right of representation takes place only devise or legacy, the part assigned to one who
in the direct descending line: never in the renounces or cannot receive his share or who
ascending line (Art. 972). died before the testator is added or incorporated
c. In the collateral line, representation takes to that of his co-heirs, co-devisees, or co-
place only in favor of children of brothers legatees.
and sisters, whether full or half blood (Art.
972, second par.). Hence, grandnephews Basis
and grandnieces do not represent. The right of accretion is based upon the
d. There is representation in favor of the presumed will of the decedent. Thus, the testator
adopted (see Sections 41 and 43 of new can expressly provide that there shall be no
law RA 11642) accretion among persons who would otherwise
• Section 43. In testate and Intestate be entitled thereto. Conversely, the testator may
succession, the adopters and the validly provide for accretion in a case where no
adoptee shall have reciprocal rights of accretion would take place under the provisions
succession without distinction from of the law. [Tolentino]
legitimate filiations. However, if the
adoptees and their biological parents a) Requisites and Limitations
have left a will, the law on testamentary Requisites for Accretion
succession shall govern. 1. Unity of object
• Section 41 Legitimacy. – The adoptee 2. Plurality of subject
shall be considered the legitimate child • two or more persons are called to the
of the adopter for all intents and same inheritance or same portion
purposes and as such is entitled to all 3. Vacant portion
the rights and obligations provided by • one of persons thus called die
law to legitimate children born to them before the testator, or renounce the
without discrimination of any kind. To inheritance, or be incapacitated to
this end, the adoptee is entitled to love, receive it-
guidance, and support in keeping with • Happens when:
the means of the family. The legitimate a.repudiation.
filiation that is created between the b.predeceased.
adopter and the adoptee shall be c.incapacity.
extended to the adopter’s parents, d.non-fulfillment of suspensive condition.
adopter’s legitimate siblings, and e.particular heir cannot be identified
legitimate descendants. The adopter is
also given the right to choose the name Priority of Distribution
by which the child is to be known, 1. Compulsory heir – legitime
consistent with the best interest of the 2. Share of instituted heir – institution
child. 3. Substitution (predecease, incapacity)
e. The representative must himself be capable 4. Representation
of succeeding the decedent (Art. 973). 5. Accretion- only in instances where our
f. The representative must at least be compulsory heirs are instituted or for
conceived at the time succession opens. voluntary heirs, devises and legacies -
g. When there is representation, the heirs compulsory heirs always inherit in their own
inherit per stirpes, not per capita (Art. 974). right6. Intestate succession- accretion may
That is, all those in a group inherit in equal be applied in intestate succession only in
shares, because per stirpes means cases of REPUDIATION [Art. 1018, CC]
inheritance by group. h. A renouncer may
not be represented but he can represent the Rules of Accretion
person whose inheritance he has 1. The heirs to whom the portion goes by the
renounced. right of accretion take it in the same
h. Illegitimate children may represent their proportion that they inherit. [Art. 1019, CC]
legitimate parents (Art. 922), as an exception 2. The heirs to whom the inheritance
to the iron-curtain rule. accrues shall succeed to all the rights and
i. When nephews and nieces survive with obligations which the heir who renounced
brothers or sisters, they inherit by or could not receive it would have had.
representation. If they alone survive, they [Art. 1020, CC]
inherit in equal portions or per capita.
4. ACCEPTANCE AND REPUDIATION OF a) Form of Repudiation

INHERITANCE Form of repudiation
‘Acceptance’ defined Repudiation must always be EXPRESS.
The act by which the person called to succeed by
universal title either by the testator or by law This can be done by means of a:
manifests his will of making his own the (i) public instrument;
universality of the rights and obligations (ii) authentic instrument;
which are transmitted to him. [Tolentino] (iii) petition in court.
‘Repudiation’ defined b) Effects of Repudiation Compared to

The manifestation by an heir of his desire not to
Predecease and Incapacity
succeed to the rights and obligations transmitted
to him. [Tolentino]
Descendants of the heirs who predeceased or
are incapacitated may represent the latter in
Characteristics [Arts. 1041–1042, 1056, CC]
succession, but Heirs who repudiates their share
(1) Acceptance and repudiation must be
may not be represented (Art. 977)
voluntary and free [Art. 1041, CC]
(2) They are irrevocable except if there is
vitiation of consent or an unknown will Key points:
appears [Art. 1056, CC]  Repudiation of inheritance is a voluntary act
(3) They have a retroactive effect [Art. 1042, CC] by the individual, while predecease and
incapacity are circumstances that affect the
REQUISITES: [Art. 1043, CC] person involuntarily.
(a) Certainty of death of the decedent  The effects of repudiation primarily impact the
(b) Certainty of the right to the inheritance repudiating individual and the redistribution of
assets, while predecease and incapacity
‘Acceptance or Repudiation Of The primarily affect the succession of assets and
Inheritance’ defined the legal representation of the individual.
An act which is purely voluntary and free (Art  Creditors may accept the inheritance in case
1041, NCC), the effects of which shall always repudiation prejudices them (Art 1052), while
retroact to the moment of the death of the in predecease and incapacity, only the heirs
decedent (Art 1042 NCC). in the descending line of those who
predeceased or incapacitated may accept the
Effect if Acceptance or Repudiation inheritance. (Art. 972)
Once made, is irrevocable and cannot be  Heirs in Two Capacities: [Art. 1055, CC]
impugned except for causes that vitiate consent, (1) If a person is called to the same
or when an unknown will appears (Art 1056 inheritance as an heir by will and by law
NCC). and he repudiates the inheritance in his
capacity as a testamentary heir, he
Forms of Acceptance will be considered to have also
Acceptance of an inheritance, legacy or devise repudiated the inheritance as a legal heir.
may be: (2) If he repudiates it as a legal heir, without
1. Express; knowledge of his being a testamentary
2. Must be made in a public or private document heir, he may still accept it in the latter
OR tacit; capacity.
3. One resulting from acts by which the intention
to accept is necessarily implied, or which one
would have no right to do except in the
capacity of an heir.
Examples of implied acceptance (Art. 1050):

1. If heir sells, donates, or assigns right to a
stranger, or to his co-heirs or any of them.
2. If heir renounces right, even gratuitously, for
the benefit of one or more of his co-heirs.
3. If heir renounces right for a price in favor of
co-heirs indiscriminately; but if renunciation is
gratuitous and co-heirs in whose favor
renunciation is made would get right by
accretion, inheritance is not deemed
acceptance. Acceptance is also presumed if
heir fails to accept or repudiate within 30 days
after issuance of order of distribution of
estate, he is deemed to have accepted.
OBLIGATIONS AND CONTRACTS

I. OBLIGATIONS
A. General Provisions C. Different Kinds of Obligations
B. Nature and Effects of Obligations D. Extinguishment of Obligations
A. GENERAL PROVISIONS 1. Law

• When they are imposed by the law itself.
1. DEFINITION • Obligations derived from law are NOT
• It is a juridical relation whereby a person PRESUMED.
(creditor) may demand from another (debtor) • Only those expressly determined by the New
the observance of a determinate conduct Civil Code or in special laws are demandable.
(prestation). • Example: The mutual obligation of spouses
• Art. 1156 provides that an obligation is the to support each other pursuant to the
juridical necessity to give, to do or not to do. provisions of the Family Code.
Article 1156 is Incomplete 2. Contracts

Our law merely stresses the duty of the debtor or • Arises from the stipulation of the parties.
obligor when it speaks of obligation as a juridical [Article 1306]
necessity. [De Leon, The Law on Obligations • Obligations arising from contract have the
and Contracts] force of law between the contracting parties
 Definition is NOT comprehensive and should be complied with in good faith.
 Does not say WHO should DO WHAT [Article 1159]
 Does not say WHO should DO the • Example: The obligation to repay a loan by
giving/receiving virtue of an agreement.
 No names/parties of obligation • NOTE: Obligations arising from CONTRACT
need NOT always be EXPRESS (like those
“Juridical Necessity” from LAW). They may be IMPLIED.
Obligation is a juridical necessity because in
case of non-compliance, the courts of justice 3. Quasi-Contracts
may be called upon to enforce its fulfillment or, • Certain LAWFUL, VOLUNTARY and
in default thereof, the economic value that it UNILATERAL acts give rise to the juridical
represents. relation of quasi-contract to the end that no
one shall be unjustly enriched or benefited at
the expense of another. [Article 2142]
2. ESSENTIAL ELEMENTS
• Obligations derived from quasi-contracts
1. Active Subject (Obligee or Creditor)
based on the presumed will of the parties are
• the person who can demand the fulfillment
demandable.
of the obligation;
• Subject to the provisions of Chapter 1, Title
2. Passive Subject (Obligor or Debtor)
XVII of the Civil Code. [Article 1160]
• the person from whom the obligation is
• Example: The obligation to return money paid
juridically demandable;
by mistake or which is not due. [Article 2154]
3. Object
• the prestation or the particular conduct
Kinds of Quasi-Contract
required to be observed by the debtor (to
• Negotorium Gestio
give, to do or not to do);
• Solutio Indebiti
4. Juridical Tie or Vinculum Juris
• Other Cases
• the efficient cause established by the
various sources of obligations (law,
Negotorium Gestio
contracts, quasi-contracts, delicts and
• voluntary management of the property or
quasi-delicts);
affairs of another without the knowledge or
consent of the latter. [Articles 2144-2153]
3. SOURCES OF OBLIGATION
• Whoever voluntarily takes charge of the
OBLIGATIONS ARISE FROM:
agency or management of the business or
(1) Law;
property of another, without any power from
(2) Contracts;
the latter, is obliged to continue the same until
(3) Quasi-contracts;
the termination of the affair and its incidents,
(4) Acts or omissions punished by law; and
or to require the person concerned to
(5) Quasi-delicts. [Article 1157]
substitute him, if the owner is in the position
to do so.
137
Requisites
BAR QUESTION (2015)
1. There must be voluntary assume agency
or management by the gestor; Sara borrowed P50,000.00 from Julia ang
2. Business or property must be neglected or orally promised to pay it within six months.
abandoned; When Sara tried to pay her debt on the 8th
3. Agency/management must not be
month, Julia demanded the payment of interest
authorized by owner either expressly or
impliedly; of 12% per annum because of Sara’s delay in
4. Assumption of agency/management must payment. Sara paid her debt and the interest
be made in good faith. claimed by Julia. After rethinking, Sara
demanded back from Julia the amount she had
Solutio Indebiti paid as interest. Julia claims she has no
• juridical relation which is created when obligation to return the interest paid by Sara
something is received when there is no right
because it was a natural obligation which Sara
to demand it and it was unduly delivered by
mistake. voluntarily performed and can no longer
• If something is received when there is no right recover.
to demand it, and it was unduly delivered Do you agree? Explain.
through mistake, the obligation to return it
SUGGESTED ANSWER
arises.
• Mistake in payment No, the case is not one of a natural obligation
• [Articles 2154 – 2163] but a case of solutio indebiti. This is so
because in a contract of loan, any stipulation
BAR QUESTION (2012) with respect to the payment of interest must be
Siga-an granted a loan to Villanueva in the in writing in order for it to be valid and
demandable (Article 1956, Civil Code).
amount of P 540, 000.00. Such agreement
was not reduced to writing. Siga-an The loan agreement between Sara and Julia
demanded interest which was paid by was not reduced into writing and Sara could not
Villanueva in cash and checks. The total be made liable to pay interest even if she did
not pay the obligation within the 6 month
amount Villanueva paid accumulated to P 1,
stipulated period, unless there has been a
200, 000.00. Upon advice of her lawyer, previous demand by Julia. When Sara paid
Villanueva demanded for the return of the interest to Julia, she did not do so voluntarily
excess amount of P 660, 000.00 which was but under the mistaken belief that interest was
due. Hence, this is not a case of a natural
ignored by Siga-an.
obligation.
1) Is the payment of interest valid?
Explain. 4. DELICT
2) Is solutio indebiti applicable? Explain. • Every person criminally liable is also civilly
liable [Article 100, RPC]
SUGGESTED ANSWER • Instances where acquittal does not
1) No, the payment of interest in invalid. extinguish civil liability:
The law states that no interest shall be due A. The acquittal is based on reasonable
unless it has been expressly stipulated in doubt
writing (Art. 1956, New Civil Code) Hence, B. The court declares that the liability of
Villanueva is entitled to recover the interests the accused is only civil.
paid since it cannot legally be demanded by C. The civil liability of the accused does
Siga-an under an oral contract of loan not arise from or is not based upon
(Siga-an v. Villanueva, G.R. No. 173227, the crime which the accused is
January 20, 2009). acquitted.
2) Yes, solutio indebiti is applicable Effect of the death of the accused

because the overpaid interest of P660,000 pending appeal of his conviction:
is not due. The law provides when If death of the accused occurred DURING
something is received when there is no right the pendency of his appeal but BEFORE the
to demand it, and it was unduly delivered finality of judgment:
through mistake, the obligation to return it 1. Criminal liability is extinguished.
arises. (Article 2154, Civil Code) Since the 2. Civil liability ex delicto is extinguished.
interest was not validly reduced into writing, 3. Civil liability from other sources of
Siga-an had no right to receive it. obligation survives and may be
recovered only through a civil action.
5. QUASI-DELICT (CULPA ACQUILIANA) BAR QUESTION (1977)

• Art. 2176. Whoever by act or omission causes
damage to another, there being fault or Taxi driver D, driving recklessly, killed
negligence, is obliged to pay for the damage pedestrian P and his passenger Y. Discuss the
done. Such fault or negligence, if there is no
source of the obligation of D and of his
pre-existing contractual relations between the
parties is called quasi-delict. employer to P and to Y, and the defense
• Obligations derived from quasi-delicts shall be available to the employer.
governed by the provisions of Chapter 2, Title
SUGGESTED ANSWER
XVII of this Book, and by special laws. [Article
1162] There are three overlapping sources of the
obligation of D and of his employer. They are:
Example:
Motor vehicle recklessly driven by Arnel suddenly (1) Under the Revised Penal Code:
hit a pedestrian, Mike, who was then crossing the The heirs of P and Y may proceed against D
street. Mike suffered injuries requiring medical and his employer under the Penal Code. In this
attention. Arnel is liable for damages caused to case, the source of the liability of D and of his
Mike based on quasi-delict, there being fault which
employer is the crime committed by D (culpa
is the proximate cause of injuries and there is no
criminal). The liability of D is direct and primary
pre-existing contract between them.
(Art. 100, RPC); the liability of his employer is
VDM TRADING, INC. V. CARUNGCONG, subsidiary (Art. 103, RPC). The latter cannot
G.R. NO. 206709, FEBRUARY 06, 2019 relieve himself of liability by proving due
A quasi-delict has the following elements: diligence of a good father of a family. This is so
a) the damage suffered by the plaintiff; because of the very nature of his obligation.
b) the act or omission of the defendant
supposedly constituting fault or negligence; (2) Under the Civil Code:
and (a) Heirs of P: The heirs of pedestrian P may
c) the causal connection between the act and the proceed against both D and his employer,
damage sustained by the plaintiff, or proximate or against the latter only. In this case, the
cause. source of the liability of D and his employer
is the quasi-delict (culpa aquiliana)
BAR QUESTION (2019)
committed by D (Arts. 2176, 2180, CC).
In January 2018, Mrs. A, a married woman on her (b) The liability of both is direct and primary.
sixth (6th) month of pregnancy, was crossing a D’s employer can relieve himself of liability
street when she was suddenly hit by a car being by proving due diligence of a good father of
recklessly driven by Mr. X. As a result, Mrs. A a family in the selection and supervision of
his drivers (Art. 2180, CC).
sustained serious injuries and further, suffered an
(c) Heirs of Y: On the other hand, the heirs of Y
unintentional abortion. Mrs. A was hospitalized
may proceed against D’s employer only.
for two (2) months, during which she incurred The source of the liability of D’s employer,
₱400,000.00 in medical fees. Her expenses were in this case, is the breach of his contract of
all duly substantiated by official receipts. During carriage with Y (culpa contractual). His
the two (2)-month period of her confinement, she liability is direct and primary. He cannot
was unable to report for work and earn any relieve himself of liability by proving due
salary, which was established at the rate of diligence of a good father of a family (Art.
₱50,000.00 per month. Mrs. A then filed a civil 1759, CC). This is so because under our
case for damages against Mr. X. law on common carriers, we do not adhere
to the principle of respondent superior; we
(a) Based on the case filed by Mrs. A, what is
adhere to the principle that there is always
the source of Mr. X's obligation to her as a
an implied duty of a common carrier to
result of his acts? Explain. carry the passenger safely to his place of
SUGGESTED ANSWER destination. However, although not
available as a defense, such proof of due
The source of Mr. X’s liability is quasi-delict. diligence may serve to mitigate the
Under the Civil Code, whoever by act or omission employer’s liability.
causes damage to another, there being fault or
negligence, is obliged to pay for the damages.
Such fault or negligence, if there is no pre- B. NATURE AND EFFECTS OF
existing contractual relations between the parties OBLIGATIONS
is called a quasi-delict.
CIVIL OBLIGATIONS
Here, there is no pre-existing contractual Those that are based on positive law and give a
relations between Mrs. A and Mr. X who are
right of action to compel their performance.
strangers, and the damage was caused by Mr.
X’s negligence
NATURAL OBLIGATIONS Article 1178. Subject to the laws, all rights

Those that are not based on positive law but on acquired in virtue of an obligation are
equity and natural law, do not grant a right of transmissible, if there has been no stipulation to
action to enforce their performance, but after the contrary.
voluntary fulfillment by the obligor, they
authorize the retention of what has been PERFORMANCE OF OBLIGATIONS
delivered or rendered by reason thereof. [Article ‘Standard Norm’ defined
1423] • An accepted standard or a way of behaving or
doing things that most people agree with.
REAL OBLIGATIONS • Found under Article 19 of the New Civil Code.
The obligation to give or deliver:
• Obligations to deliver a determinate or Article 19. Every person must, in the exercise of
specific thing his rights and in the performance of his duties, act
• Obligations to deliver an indeterminate or with justice, give everyone his due, and observe
generic thing honesty and good faith.
PERSONAL OBLIGATIONS IN OBLIGATIONS TO GIVE DETERMINATE

This involves the obligation to do or not to do: THING
• Positive Personal Obligation 1) Obligee may compel the delivery of the thing,
• Negative Personal Obligation that itself which was promised.
General Rule: Obligor cannot substitute it.
BAR QUESTION (2015) XPN: Unless the obligee agrees OR the right
has been reserve such as in alternative
Distinguish civil and natural obligations.
obligations [Article 1244, Art 1165]
SUGGESTED ANSWER 2) Obligor must take care of the thing with the
proper diligence of a good father of a family.
A civil obligation is based on positive law which Unless the law or stipulation of the parties
gives a right of action to compel their requires another standard of care [Article
performance in case of breach. A natural 1163]
obligation is based on equity and natural law and 3) Obligation to deliver a determinate thing
cannot be enforced by court action but after includes that of delivering all its accessions
voluntary fulfillment by the obligor, they authorize
and accessories, even though they may not
the retention of what may have been delivered or
have been mentioned [Article 1166]
rendered by reason thereof (Article 1423, Civil
4) The creditor has the right to the fruits of the
Code).
thing from the time the obligation to deliver
DETERMINATE THING v. GENERIC THING arises. However, he shall have no real right
over it until the same has been delivered to
DETERMINATE him. [Article 1164]
GENERIC THING
THING
IN OBLIGATIONS TO GIVE INDETERMINATE/
A thing is considered A thing is generic if it GENERIC THING
determinate when it has been designated 1) Obligor must deliver a thing of the quality
has been particularly merely by its class. specified.
designated or • If none is fixed, he must deliver one of
physically segregated average quality.
from all others of the • Neither can the obligor deliver a thing of
same class or species. inferior quality nor the obligee demand one
of superior quality.
A concrete, One whose 2) The creditor may ask that the obligation be
particularized object, determination is complied with at the expense of the debtor.
indicated by its own confined to that of its [Article 1246, Article 1165]
individuality. nature, to the genus to
which it pertains. IN OBLIGATIONS TO DO
• If a person is obliged to do something, it must
Example: Honda Civic Example: be done as promised.
with plate No. WRX a horse; • It cannot be substituted by another act or
204 and engine No. a chair; forbearance against the obligee’s will [Article
223456 a gadget. 1244]
• If obligor fails to do it, it shall be executed at his
TRANSMISSIBILITY OF OBLIGATIONS cost;
General Rule: All rights acquired by virtue of an • Obligor may not be compelled to do it
obligation are transmissible. [Article 1178] personally or by himself (Constitutional right
XPN: against involuntary servitude);
(a) prohibited by law; • Same rule if he does it in contravention of the
(b) prohibited by stipulations; and tenor of the obligation (COTOTO)
(c) purely personal. • Poorly done be UNDONE [Article 1167]
IN OBLIGATIONS NOT TO DO Rules in Voluntary Breach of Obligation

Article 1168. When the obligation consists in not • General Rule: Responsibility arising from
doing, and the obligor does what has been fraud is demandable in all obligations.
forbidden him, it shall be undone at his expense. • XPN: Any waiver of an action for future fraud
is void. [Article 1171]
1. BREACHES OF OBLIGATIONS
• Subject to such exceptions or qualifications Article 1172. Responsibility arising from
as the law or the parties themselves may negligence in the performance of every kind of
provide, obligations must be complied with obligation is also demandable, but such liability
PRECISELY (“identity of the obligations”) and may be regulated by the courts, according to the
COMPLETELY (“integrity of obligations”) as circumstances.
promised or required.
• Those who in the performance of their 2) NEGLIGENCE
obligations are guilty of fraud, negligence, or • The fault or negligence of the obligor consists
delay, and those who in any manner in the omission of that diligence which is
contravene the tenor thereof, are liable for required by the nature of the obligation and
damages. [Article 1170] corresponds with the circumstances of the
persons, of the time and of the place.
Voluntary Breach of Obligation • When negligence shows bad faith, the
1. Fraud provisions of Art 1171 (on fraud) shall apply.
2. Negligence
3. Default R. TRANSPORT CO. V. LUISITO YU
4. Contravention of tenor of the obligation G.R. NO. 174161 FEBRUARY 18, 2015
It is the failure to observe for the protection of
1) FRAUD the interests of another person that degree of
• It is the deliberate and intentional evasion of care, precaution, and vigilance which the
the normal fulfillment of obligations. circumstances justly demand, whereby such
• Malice or bad faith in the performance of other person suffers injury." Verily,
obligation (distinguished from fraud in the foreseeability is the fundamental test of
celebration of contracts – deceit negligence. It is the omission to do something
• Responsibility arising from fraud is which a reasonable man, guided by those
demandable in all obligations. considerations which ordinarily regulate the
• Any waiver of an action for future fraud is conduct of human affairs, would do, or the doing
void. [Article 1171] of something which a prudent and reasonable
man would not do.
CIVIL FRAUDS DISTINGUISHED
FORTUITOUS EVENT
Fraud/ Dolo in the • Extraordinary events not foreseeable or
Causal Fraud
Performance avoidable.
• It is any extraordinary event which cannot be
Present only during the Present only during the foreseen, or which, though foreseen, is
performance of a pre- time of birth or inevitable. In other words, it is an event which
existing obligation. perfection of the is either impossible to foresee or impossible
obligation. to avoid.
• The essence of a fortuitous event consists of
Purpose is to evade the Purpose is to secure being a happening independent of the will of
normal fulfillment of the the consent of the other the obligor and which happening, makes the
obligation. to enter into a contract. normal fulfillment of the obligation impossible.
Results in the non- Results in the vitiation Liability in case off Fortuitous Event
fulfillment or breach of of consent. General Rule: No person shall be responsible
the obligation. for those events which could not be foreseen
(accident), or which, though foreseen, were
Gives rise to a right of Gives rise to a right of inevitable (force majeure). [Article 1174]
the obligee to recover an innocent party to XPN: Except in cases:
damages from the annul the contract. • Expressly specified by law (i.e. delay) [Article
552 (2), 1165 (3), 1268, 1942, 2147, 2148
debtor and not a cause
and 2159];
of annulment of • When it is otherwise declared by stipulation,
contract. or
• When the nature of the obligation requires
Valid obligation. Voidable obligation.
the assumption of risk. [Article 1174]
• When the object of the prestation is generic.
Some Exceptions Expressly Specified by Ruling:

Law The elements of a "fortuitous event" are as
• Article 552 – The obligor is a possessor in follows: (a) the cause of the unforeseen and
bad faith; unexpected occurrence must be independent of
• Article 1165 – The obligor delays or has human will; (b) it must be impossible to foresee
promised to deliver the same thing to two or the event which constitutes the caso fortuito, or if
more persons who do not have the same it can be foreseen, it must be impossible to
interest; avoid; (c) the occurrence must be such as to
• Article 2147 – The negotiorum gestor or render it impossible for the debtor to fulfill his
officious manager who undertakes risky obligation in a normal manner; and (d) the
transactions, prefers his interest to that of the obligor must be free from any participation in the
owner, fails to return the property upon aggravation of the injury resulting to the creditor.
demand by the owner, or assumes Article 1174 of the Civil Code provides that no
management in bad faith; person shall be responsible for a fortuitous event
• Article 1979 – The depositary who uses the which could not be foreseen, or which, though
thing without the depositor’s permission, foreseen, was inevitable. In other words, there
delays its return, or allows others to use it. must be an entire exclusion of human agency
• Article 1268 – When the obligation to deliver from the cause of injury or loss.
a determinate thing proceeds from a criminal
offense, unless prior to its loss the person It is established that the fire originated from
who should receive it refused acceptance leaking fumes from the LPG stove and tank
without justification. installed at petitioner's fastfood stall and her
employees failed to prevent the fire from
Requisites of a Fortuitous Event spreading and destroying the other fastfood
Whether an act of man or an act of God, to stalls, including respondent's fastfood stall. Such
constitute a fortuitous event, it is essential that: circumstances do not support petitioner's theory
a. The event must be independent of the will of of fortuitous event. Petitioner not only failed to
the debtor; show that she submitted proof that the LPG
b. The event must be either unforeseeable or stove and tank in her fastfood stall were
inevitable; maintained in good condition and periodically
c. The event must have prevented the debtor checked for defects but she also failed to submit
from complying with his obligation in a proof that she exercised the diligence of a good
normal manner; father of a family in the selection and supervision
d. The debtor must be free from any of her employees. For failing to prove care and
participation in the aggravation of the injury diligence in the maintenance of her cooking
resulting to the creditor. equipment and in the selection and supervision
of her employees, the necessary inference was
REAL v. BELO that petitioner had been negligent.
G.R. NO. 146224, JANUARY 26, 2007
Facts: PERLA CAMPANIA DE SEGUROS , INC VS
Petitioner owned and operated the Wasabe SARANGAYA III
Fastfood stall located at the Food Center of the G.R. NO. 147746, OCTOBER 25, 2005
Philippine Women's University (PWU) along Taft In a vehicular accident, a mechanical defect will
Avenue, Malate, Manila. Sisenando H. Belo not release the defendant from liability if it is
(respondent) owned and operated the BS shown that the accident could have been
Masters fastfood stall, also located at the Food prevented had he properly maintained and taken
Center of PWU. Around 7:00 o'clock in the care of the vehicle.
morning of January 25, 1996, a fire broke out at
petitioner's Wasabe Fastfood stall. The fire ILLUSTRATION
spread and gutted other fastfood stalls in the Tire Blow Out
area, including respondent's stall. An The explosion of the new tire may not be
investigation on the cause of the fire by Fire considered a fortuitous event. There are human
Investigator SFO1 Arnel C. Pinca (Pinca) factors involved in the situation. The fact that the
revealed that the fire broke out due to the tire was new did not imply that it was entirely
leaking fumes coming from the Liquefied free from manufacturing defects or that it was
Petroleum Gas (LPG) stove and tank installed at properly mounted on the vehicle. Neither may
petitioner's stall. For the loss of his fastfood stall the tire bought is of a brand name noted for
due to the fire, respondent demanded quality, that it could not explode within five days’
compensation from petitioner. However, use. It is settled that an accident caused either
petitioner refused to accede to respondent's by defects or through the negligence of its driver
demand. is not a caso fortuito that would exempt the
Issue: carrier from liability for damages. (Yobido vs.
WoN the fire was a fortuitous event. CA, Oct. 17, 1997; Juntilla vs. Fontanar, May 31,
1985)
JIMMY CO VS CA SSS VS. MOONWALK DEVELOPMENT AND

G.R. NO. 124922, JUNE 22, 1998 HOUSING CORPORATION
Carnapping per se cannot be considered as G.R. NO. 73345, APRIL 7, 1993
a fortuitous event. xxx It must be proved and This case does not fall within any of the
instances when demand is not necessary to
established that the event was an act of God
render the obligor in default. SSS is not excused
or was done solely by third parties and that
from making a demand. It has been established
neither the claimant nor the person alleged that at the time of payment of the full obligation,
to be negligent has any participation. Moonwalk has long been delinquent in meeting
It must likewise be emphasized that its monthly arrears and in paying the full amount
pursuant to Articles 1174 and 1262 of the of the loan itself as the obligation matured
New Civil Code, liability attaches even if the sometime in January, 1977. But mere
loss was due to a fortuitous event if "the delinquency in payment does not necessarily
nature of the obligation requires the mean delay in the legal concept.
assumption of risk". Carnapping is a normal In order that the debtor may be in default
business risk for those engaged in the repair it is necessary that the following requisites be
present:
of motor vehicles. For just as the owner is
(1) that the obligation be demandable and
exposed to that risk so is the repair shop
already liquidated;
since the car was entrusted to it. (2) that the debtor delays performance; and
(3) that the creditor requires the performance
SICAM V. JORGE judicially and extrajudicially.
529 SCRA 443 (4) Default generally begins from the moment
Robbery per se, just like carnapping, is not a the creditor demands the performance of
fortuitous event. It does not foreclose the the obligation.
possibility of negligence on the part of the
obligor. The unforeseen event, the robbery, Kinds of Default
must take place without the concurrent fault 1) Mora solvendi - Delay on the part of the
debtor to perform his obligation.
of the debtor to be appreciated as a
2) Mora accipiendi - Delay of the creditor in
fortuitous event.
accepting delivery of the thing which is the
object of the obligation.
3) DEFAULT 3) Compensatio morae - Delay of the parties
• Breach of obligation based on time of or obligors in reciprocal obligation.
performance.
• Those obliged to deliver or to do Rules on Default
something incur in delay (”mora”) from the
time the obligee judicially or extrajudicially Unilateral Obligation
demands from them the fulfillment of their • Demand is necessary.
obligation. [Article 1169] • No demand = No delay.
General Rule: Mere expiration of the period
• Mere non-performance of the obligation
fixed by the parties will not cause delay.
on the time fixed does not necessarily put
XPN:
the obligor in default. (a) Express stipulation that demand is not
• No demand – No delay necessary;
• A demand before maturity date is (b) The law EXPRESSLY so declares (i.e.,
ineffective. taxes);
(c) Time is of the essence of the contract – the
Instances When Demand Is Not designation of time when the thing is to be
Necessary To Render the Obligor In delivered or the service is to be rendered
Default: was a controlling motive for the
• When the obligation or the law expressly establishment of the contract;
(d) Demand would be useless as when the
so declares;
obligor has rendered it beyond his power to
• When from the nature and the
perform.
circumstances of the obligation it appears
that the designation of the time when the Reciprocal Obligation
thing is to be delivered or the service is to • Fulfillment by both parties should be
be rendered was a controlling motive for simultaneous;
the establishment of the contract; or • Neither party incurs in delay if the other does
• When the demand would be useless, as not comply or is not ready to comply in a
when the obligor has rendered it beyond proper manner with what is incumbent upon
his power to perform. him.
General Rule: From the moment one of the On performance and rescission
parties fulfills his obligation, delay by the other (resolution)
begins (Art. 1169) • The remedies are not cumulative but
XPN: When different dates for the performance alternative.
of obligation is fixed by the parties; Demand is • If fulfillment becomes impossible, the
necessary in such cases. injured party may still seek rescission after
BAR QUESTION (2015) he has chosen fulfillment.
• The court shall likewise decree rescission
X, a dressmaker, accepted clothing materials where fulfillment is prohibited by lawful
from Karla to make two dresses for her. On authority.
the day X was supposed to deliver Karla's • The right to rescind is NOT ABSOLUTE. If
dresses, X called up Karla to tell her that she the court finds that the breach is slight and
had an urgent matter to attend to and will casual and not so substantial and
deliver them the next day. That night, fundamental as to defeat the object of the
however, a robber broke into her shop and parties, it may instead grant a period.
took everything including Karla's two • Without a just cause, there would be no
dresses. X claims she is not liable to deliver reason to fix a period. [Article 1191]
Karla's dresses or to pay for the clothing
materials considering she herself was a B) SUBSIDIARY REMEDIES
victim of the robbery which was a fortuitous • Where principal remedies are unavailable
event and over which she had no control. Do or ineffective.
you agree? Why?
SUGGESTED ANSWER 1) Accion subrogatoria/ Subrogatory
Action [Article 1171]
No, I do not agree with the contention of X. • An action against the debtor’s debtor.
The law provides that except when it is
otherwise declared by stipulation, or when Requisites:
the law provides, or the nature of the 1) Creditor must have right of return against
obligation requires the assumption of risk, no
debtor;
person shall be liable for those events which
2) The debt is due and demandable;
could not be foreseen or which though
3) There is a failure of the debtor to collect
foreseen were inevitable (Article 1174, Civil
his own debt from 3rd persons, either
Code). Based on the facts, X was supposed
through malice or negligence;
to deliver the dress the day immediately
4) Debtor's assets are insufficient;
before the robbery. Demand is dispensed
5) The right of action is not purely personal.
with in this case, since demand would be
useless because X already stated that she
cannot perform the obligation on the agreed
2) Accion Pauliana/ Rescissory Action
time. Thus, X cannot invoke fortuitous event [Article 1171, Article 1381]
as a defense because she had already • An action to rescind contracts entered into
incurred in delay at the time of the by the debtor in fraud of creditors.
occurrence of the loss.
Requisites:
Yes, I agree that X is not liable since the loss 1) There is a credit in favor of plaintiff;
was due to a fortuitous cause. The rule is 2) The debtor has performed an act
that before the debtor may be put in default, subsequent to the contract, giving
there must first be a judicial or extrajudicial advantage to other persons;
demand by the creditor. (Article 1169, Civil 3) The creditor is prejudiced by the debtor's
Code}. This is true even if a period may have act which are in favor of 3rd parties and
been stipulated for the performance of the rescission will benefit the creditor;
obligation unless by stipulation of the parties, 4) The creditor has no other legal remedy;
demand has been waived by them. The facts 5) The debtor's acts are fraudulent.
are silent as to whether Karla has made any
demand upon X to fulfill her obligation to Damages
deliver the dresses and, the mere arrival of • Those in the performance of their
the period does not necessarily put the obligation are guilty of fraud, negligence or
debtor in actionable delay without proof that delay and those who in any manner
demand was dispensed with based on their contravene the tenor thereof are liable for
agreement. Hence, at the time of the damages.
fortuitous loss, the debtor X was not yet in
default. Thus, X is not liable for damages.
C) OTHER REMEDIES SUSPENSIVE V. RESOLUTORY CONDITION

• Attach and execute debtor's property which
is not exempt [Article 2236] SUSPENSIVE RESOLUTORY
• Accion directa [Article 1729, Article 1652] CONDITION CONDITION
• Replevin, garnishment, receivership, etc.
when the acquisition of when the obligation is
C. DIFFERENT KINDS OF rights or demandability at once due and
OBLIGATIONS of the obligation must demandable, but the
await the occurrence of right is extinguished or
1) PURE OBLIGATIONS
the condition. lost upon the fulfillment
• It is one whose performance does not
depend upon a condition or period. of the condition.
• It is one which is not subject to any condition
and no specific date is mentioned for its 'Condition' defined
fulfillment and is, therefore, immediately • It is a future and uncertain event, upon the
demandable. happening of which, the effectivity or
• Condition – is a future or uncertain event or extinguishment of an obligation (or rights)
upon a past event unknown to the parties. subject to it depends.
• relates on the payment, not the constitution of
• Period – or term is a day certain – that which
an obligation – construe it as an obligation
must necessarily come – although it may not
with a period and ask the court to fix the
be known when (Art 1173, Art 1193)
period.
• When the period of payment in an obligation
2) CONDITIONAL OBLIGATIONS
is left to the exclusive will of the debtor, said
• It is one whose consequences are subject in
condition should be void. But such will not
one way or another to the fulfillment of a convert the obligation into a pure obligation.
condition.
• The acquisition of rights (SUSPENSIVE), as JAVIER AND JAVIER V. CA
well as the extinguishment or loss of those G.R. NO. L-48194. MARCH 15, 1990
already acquired (RESOLUTORY), shall When a contract is subject to a suspensive
depend upon the happening of the event condition, its birth or effectivity can take place
which constitutes the condition. [Article only if and when the event which constitutes the
1181] condition happens or is fulfilled. If the
• When the debtor binds himself to pay when suspensive condition does not take place, the
his means permit him to do so, the obligation parties would stand as if the conditional
shall be deemed to be one with period. obligation had never existed.
[Article 1181]
FULFILLMENT OF SUSPENSIVE CONDITION
BAR QUESTION (1975) • The condition that some event will happen at
a determinate time shall extinguish the
A owed B a certain sum of money. C wrote
obligation as soon as the time expires or it
B a letter stating that he would be the one
has become indubitable that the event will not
to take care of A's debt as soon as A had take place [Article 1184]
made a shipment of logs to Japan. A never • The condition that some event will not happen
made such shipment, C did not pay B. Is C at a determinate time shall render the
liable to B? Explain. obligation effective from the moment the time
indicated has elapsed, or if it has become
SUGGESTED ANSWER evident that the event cannot occur.
No, C is not liable to B. C did not assume • If no time has been fixed, the condition shall
the obligation of A. C merely stated that he be deemed fulfilled at such time as may have
will “take care” of A’s debt. Moreover, even probably been contemplated, bearing in mind
the nature of the obligation [Article 1185]
if C assumed liability, the suspensive
condition—namely, the shipment by A of DOCTRINE OF CONSTRUCTIVE
logs to Japan, was never fulfilled. C’s FULFILLMENT OF SUSPENSIVE CONDITION
obligation never arose. Under Article 1181 • The condition shall be deemed fulfilled when
of the Civil Code, in conditional obligations, the obligor voluntarily prevents its fulfillment.
the acquisition of rights, as well as the [Article 1186]
extinguishment or loss of those already
acquired, shall depend upon the happening ‘Constructive Fulfillment’ defined
of the event which constitutes the • Refers to an obligation prevented by the
condition. (Villanueva v. Girged, 110 Phil. obligor from happening.
478)
INTERNATIONAL HOTEL CORPORATION BAR QUESTION (1997)

V. FRANCISCO B. JOAQUIN, JR. AND
RAFAEL SUAREZ In two separate documents signed by him,
G.R. NO. 158361, APRIL 10, 2013 Juan Valentino “obligated” himself each to
Constructive fulfillment of a suspensive Maria and to Perla, thus – ‘To Maria, my
condition, whose application calls for two true love, I obligate myself to give you my
requisites, namely: (a) the intent of the one and only horse when I feel like It.’ –
obligor to prevent the fulfillment of the and – ‘To Perla, my true sweetheart, I
condition, and (b) the actual prevention of obligate myself to pay you the P500.00 I
the fulfillment. owe you when I feel like it.’ Months passed
Mere intention of the debtor to prevent the but Juan never bothered to make good his
happening of the condition, or to place promises. Maria and Perla came to consult
ineffective obstacles to its compliance, you on whether or not they could recover
without actually preventing the fulfillment, is on the basis of the foregoing settings. What
insufficient. would your legal advice be?
SUGGESTED ANSWER
KINDS OF CONDITION
• Potestative - fulfillment of the condition I would advise Maria not to bother running
depends on the will of a party to the after Juan for the latter to make good his
obligation promise. Under the Civil Code, Juan’s
• Casual - fulfillment of the condition promise to Maria is void because it is a
depends on chance and/or the will of a conditional obligation which depends upon
third person/stranger the sole will of the obligor. (Art. 1182)
• Mixed - partly potestative and partly
casual. As regards Perla, the document is an
express acknowledgment of a debt, and the
Obligation with Potestative Condition promise to pay what he owes her when he
1. When it depends exclusively to the will of feels like it is equivalent to a promise to pay
the Creditor— VALID. when his means permits him to do so. It is
2. When it depends exclusively upon the deemed to be one with an indefinite period,
will of the Debtor in case of a suspensive hence, the amount is recoverable after
condition— VOID. Perla asks the court to fix the period. (Arts.
3. When it depends exclusively upon the 1180, 1197[2]).
will of the Debtor in case of a resolutory
IMPOSSIBLE CONDITIONS
condition— VALID. • Impossible conditions, those contrary to good
4. When it is imposed not on the birth of the customs or public policy and those prohibited
obligation but on its fulfillment—the by law shall annul the obligation which
condition is VOID but not the pre-existing depends upon them.
obligation. • If the obligation is divisible, the part thereof
which is not affected by the impossible
BAR QUESTION (2000) condition or unlawful condition shall be valid.
• The condition not to do an impossible thing
Pedro promised to give his grandson a car shall be considered as not having been
if the latter will pass the bar examinations. agreed upon.
When his grandson passed the said • In law on donations and in testamentary
examinations, Pedro refused to give the car succession, such conditions are simply
on the ground that the condition was a disregarded.
purely potestative one. Is he correct or • Obligations which are made to depend on
not? casual or mixed conditions are VALID.
SUGGESTED ANSWER Effects of Impossible Conditions

1) Conditional obligation is void – both
No, he is not correct. First of all, the
obligation and condition are void
condition is not purely potestative, because 2) Conditional obligation is valid – if condition is
it does not depend on the sole will of one of negative, it is disregarded and obligation is
the parties. Secondly, even if it were, it rendered pure and valid
would be valid because it depends on the 3) Only the affected obligation is void – if the
sole will of the creditor (obligee) and not of obligation is divisible, the part not affected by
the debtor (obligor). the impossible condition shall be valid
4) Only the condition is void – if obligation is EFFECT OF LOSS, DETERIORATION, AND

pre-existing, not depending on fulfillment of IMPROVEMENT IN REAL OBLIGATION
the condition which is impossible for its 1. Loss
existence, only the condition is void • Without Debtor’s Fault—the obligation shall
5) Condition considered not imposed – if be extinguished.
impossible/unlawful condition is attached for • With Debtor’s Fault—he shall be obliged to
a simple or remuneratory donation as well as pay damages
to a testamentary disposition, condition is
considered not imposed while the obligation 'Lost' defined
is valid. A thing is LOST when it perishes, or goes out of
commerce, or disappears in such a way that its
BAR QUESTION (2003) existence is UNKNOWN or it cannot be
Are the following obligations valid, why, recovered.
and if they are valid, when is the
2. Deterioration
obligation demandable in each case?
• Without debtor’s fault—the impairment is to
a) If the debtor promises to pay as soon
be borne by the creditor
as he has the means to pay; • With debtor’s fault—the creditor may choose
b) If the debtor promises to pay when he between the rescission of the obligation and it
likes; fulfillment, with indemnity for damages in
c) If the debtor promises to pay when he either case.
becomes a lawyer;
d) If the debtor promises to pay if his son, 3. Improvement
who is sick with cancer, does not die within • By it’s nature or by time—the improvement
one year. shall inure to the benefit of the creditor.
• At the expense of the debtor—he shall have
SUGGESTED ANSWER no other right than that granted to the
usufructuary.
a) The obligation is valid. It is an obligation
subject to an indefinite period because the Hence: the debtor can only ask reimbursement
debtor binds himself to pay when his for necessary expenses [Article 546], remove
means permit him to do so. (Article 1180, the improvements without injuring the principal
NCC).The creditor must file an action in property, or off-set the value against damage
court to fix the period, and when the sustained by the property.
definite period as set by the court arrives,
the obligation to pay becomes demandable RESCISSION OF RECIPROCAL
(Article 1197, NCC). OBLIGATIONS
General Rule: The power to rescind obligations
is implied in reciprocal ones, in case one of the
b) The obligation “to pay when he likes” is
obligors should not comply with what is
an obligation with a suspensive condition. incumbent upon him. [Article 1191]
Considering that the fulfillment of the
suspensive condition is subject to the sole Remedy of Injured Party
will of the debtor, the conditional obligation a. Fulfillment of the obligation with the payment
is void. (Article 1182, NCC). of damages.
b. Rescission of the obligation with the
c) The obligation is valid. It is subject to a payment of damages.
suspensive condition, i.e. the future and c. Rescission after fulfillment if the latter should
uncertain event of his becoming a lawyer. become impossible.
The performance of this obligation does not
General Rule: The court shall decree the
depend solely on the will of the debtor but
rescission claimed.
also on other factors outside the debtor’s XPN: Unless there be just cause authorizing the
control. fixing of period.
d) The obligation is valid. The death of the When Rescission Is Not Permitted
son of cancer within one year is made a Rescission will not be permitted for slight or
negative suspensive condition to his casual breach of the contract, but only for such
making the payment. The obligation is breaches as are so substantial and fundamental
demandable if the son does not die within as to defeat the object of the parties in making
one year. (Article 1185, NCC). the agreement.
.
Art. 1191 does NOT apply to the BAR QUESTION (2013)

following: Gary is a tobacco trader and also a lending
• Contracts of partnership where a partner investor. He sold tobacco leaves to Homer
fails to pay the whole amount which he for delivery within a month, although the
has bound to contribute to the common period for delivery was not guaranteed.
fund [Article 1786 and 1788] Despite Gary's efforts to deliver on time,
• Sales of real or personal property by transportation problems and government
installments. (governed by Recto Law and red tape hindered his effort, and he could
Maceda Law) only deliver after 30 days. Homer refused
• Action for rescission is not required upon to accept the late delivery and to pay on
breach of compromise agreement; Art. the ground that the agreed term had not
2041 confers upon the party concerned been complied with.
the authority to regard it as rescinded and As lending investor, Gary granted a
to insist upon the original demand. P1,000,000 loan to Isaac to be paid within
two years from execution of the contract.
3) OBLIGATION WITH A TERM OR As security for the loan, Isaac promised to
PERIOD deliver to Gary his Toyota Innova within
• Obligations whose demandability or seven (7) days, but Isaac failed to do so.
extinguishment are subject to the Gary was thus compelled to demand
expiration of a term or period. payment for the loan before the end of the
• A term or period is an interval of time, agreed two-year term.
which, exerting an influence on an (1) Was Homer justified in refusing to
obligation as a consequence of a juridical accept the tobacco leaves?
act, either suspends its demandability or (2) Can Gary compel Isaac to pay his
produces extinguishment. It is an event loan even before the end of the two-year
which must necessarily happen. (Future period?
and Certain)
SUGGESTED ANSWER
Article 1180. When the debtor binds himself 1) No. Homer was not justified in refusing
to pay when his means permit him to do so, to accept the delivery. It is clear that the
the obligation shall be deemed to be one period for delivery was not guaranteed.
with a period. Obligations arising from contracts have the
force of law between the contracting parties
Benefit of Term or Period and must be complied with in good faith.
Whenever in an obligation a period is There is nothing stated in the facts which
designated, it is presumed to have been would indicate that Gary acted in bad faith
established for the benefit of both the or deliberately delayed the delivery.
creditor and the debtor. [Article 1196]
2) Yes, Gary can compel Isaac to
Instances When Debtor Loses The immediately pay the loan. Isaac lost his
Benefit Of The Term or Period right to make use of the period because he
• When after the obligation has been failed to furnish the guaranty or security in
contracted, he becomes insolvent. consideration of which Gary agreed to the
XPN: Unless he gives a guaranty or period. As a result, the obligation which
security for the debt was originally with a period became
• Whenever he does not furnish to the immediately demandable
creditor the guaranties or securities which
he has promised. BAR QUESTION (1973)
• When by his own acts he has impaired
D borrowed P2, 000.00 from C in 1958. The
said guarantees or securities after their
debt is evidenced by a promissory note
establishment and when through a executed by D wherein he promised to pay as
fortuitous event they disappear. soon as he has money or as soon as possible.
XPN: Unless he immediately gives new C has made repeated demands upon D for
ones equally satisfactory. payment, but up to now no payment has been
• When the debtor violates any undertaking made. Suppose that C will bring an action
in consideration of which the creditor against D for payment of the debt, will the
agreed to the period. action prosper?
• When the debtor attempts to abscond.
SUGGESTED ANSWER SUGGESTED ANSWER

No, the action will not prosper. In similar “M” must bring an action against “N’’ for the
cases decided by the Supreme Court purpose of asking the court to fix the
(Gonzales vs. Jose, 66 Phil. 369; Patente duration of the term or period for payment.
vs. Omega, 49 OG 4846) it was held, that According to the Civil Code, when the
where the debtor promises to pay his debtor binds himself to pay when his
obligation as soon as he has money or as means permit him to do so, the obligation
soon as possible, the duration of the term shall be deemed to be one with a period.
or period depends exclusively upon the will (Arts. 1180 and 1197)
of the debtor; consequently, the only
remedy of the creditor is to bring an action Normally, before an action for collection
against the debtor in accordance with Art. may be maintained by “M” against “N,’’ the
1197 of the Civil Code for the purpose of former must first bring an action asking the
asking the court to fix the duration of the court to fix the period of payment. However,
term or period. It is only after the duration a case combining such action with that of
of the term or period has been fixed by the an action for collection may be allowed if it
court that any other action involving the can be shown that a separate action for
fulfilment or performance of the obligation collection would be a mere formality
can be maintained. This has always been because no additional proofs other than the
the consistent doctrine in this jurisdiction admitted facts will be presented and would
serve no purpose other than to delay. Here,
When Court may Fix Period there is no legal obstacle to such course of
a. If the obligation does not fix a period, action. (Borromeo vs. Court of Appeals, 47
but from its nature and circumstances it SCRA 65)
can be inferred that a period was
intended; In a deed of sale of a realty, it was
b. If the duration of the period depends stipulated that the buyer would construct a
upon the will of the debtor; and commercial building on the lot while the
c. If the debtor binds himself to pay when seller would construct a private
his means permit him to do so (Art passageway bordering the lot. The building
1180 was eventually finished but the seller failed
d. If fixing the period is justified. [Article to complete the passageway as some of
1191] the squatters, who were already known to
be there at the time they entered into the
Note: contract, refused to vacate the premises. In
When obligation is demandable at once: fact, prior to its execution, the seller filed
• Pure obligations (Art. 1179, par. 1) ejectment cases against the squatters.
• Obligations with a resolutory condition
(Art. 1179, par. 2) The buyer now sues the seller for specific
• Obligations with a resolutory term (Art. performance with damages. The defense is
1193, par. 2) that the obligation to construct the
• Obligations with a condition not to do an passageway should be with a period which,
impossible thing (Art. 1183, par. 2) incidentally, had not been fixed by them,
hence, the need for fixing a judicial period.
BAR QUESTION (1991) Will the action for specific performance of
the buyer against the seller prosper?
M and N were very good friends. N
borrowed P10, 000.00 from M. Because of
No. the action for specific performance filed
their close relationship, the promissory note
by the buyer is premature under Art. 1197
executed by N provided that he would pay
of the Civil Code. If a period has not been
the loan “whenever his means permit.”
fixed although contemplated by the parties,
Subsequently, M and N quarreled. M now
the parties themselves should fix that
asks you to collect the loan because he is
period, failing in which, the Court maybe
in dire need of money. What legal action,
asked to fix it taking into consideration the
if any, would you take in behalf of M?
probable contemplation of the parties.
Before the period is fixed, an action for
specific performance is premature.
When choice belongs to creditor

Alternative Answer:
Borromeo v. CA 1) Due to fortuitous event
a. All are lost – obligation is extinguished.
4) ALTERNATIVE OR FACULTATIVE b. Some but not all are lost – the creditor
shall choose from among the remainder.
Simple Obligation - If there is only one c. Only one remains – deliver that which
prestation. remains. Obligation becomes simple.
If there are several prestations, it could be
Conjunctive or Distributive. 2) Due to debtor’s fault
a. All are lost – creditor may claim the
For Distributive, it could be Alternative or value of any of the prestations lost, with
Facultative. indemnity for damages.
b. Some but not all are lost – creditor may
Alternative Obligation claim any of those subsisting without a
• A person alternatively bound by different right to damages OR value of the thing
prestations shall completely perform one lost with right to damages.
of them. [Article 1199]
• The creditor cannot be compelled to Facultative Obligation
receive part of one or part of the other • When only one prestation has been
undertaking. agreed upon, but the obligor may render
another in substitution, the obligation is
Right of Choice called facultative. [Article 1206]
• The right of choice belongs to the debtor. • Substitution becomes effective only from
• The creditor may exercise the right only the time it has been communicated to the
when the same has been expressly creditor.
granted to him. • Choice belongs to the debtor.
Effect of Loss Effect of Loss of Substitute

The loss or deterioration of the thing
When choice belongs to the debtor: intended as a substitute, through the
negligence of the obligor, does not render
1) Loss by reason of fortuitous event him liable. But once the substitution has
a. All are lost – obligation is extinguished. been made, the obligor is liable for the loss
b. Some but not all are lost – debtor shall of the substitute on account of his delay,
choose from among the remainder negligence or fraud.
c. Only one remains – deliver that which
remains. Obligation becomes simple. 5) JOINT AND SOLIDARY OBLIGATIONS
2) Loss due to debtor’s fault Joint Obligations

a. All are lost – creditor shall have a right • Obligacion Mancomunada
to recover value of the last thing which • Each of the debtors liable only for their
disappeared or service which become proportionate share of the debt
impossible, with indemnity for damages. • Each of the creditors entitled only for their
b. Some but not all are lost – debtor shall proportionate part of the credit from each
choose from among the remainder debtor
without damages. • The whole obligation is to be paid or
c. Only one remains – deliver that which fulfilled proportionately by different
remains debtors or demanded proportionately by
different creditors.
3) Loss due to creditor’s fault
a. Some but not all are lost – debtor may Solidary Obligations
perform any from those that remains OR • Obligacion Solidaria
ask for rescission of contract with • Each one of the debtors is bound to
damages. render and/or each one of the creditors
b. All are lost – obligation is extinguished. has a right to demand entire compliance
with the prestation.
• Each one of the debtors answers not only for NATURE OF A COLLECTIVE OBLIGATION
the portion affecting him, but also for the General Rule: Obligation is presumed joint if
portion pertaining to others. there is concurrence of several creditors OR of
• Payment made by one of the solidary debtors several debtors OR of several creditors and
extinguishes the obligation. debtors in one and the same obligation.
Exceptions:
ART 1211. Solidarity may exist although the 1) The obligation expressly states that there is
creditors and the debtors may not be bound in solidarity:
the same manner and by the same period and • Jointly and severally
conditions. • Individually and collectively
• “I promise to pay” followed by the
ART 1212. Each one of the solidary creditors signatures of two or more persons
may do whatever may be useful to the others, 2) The law requires solidarity.
but not anything which may be prejudicial to the • tort, quasi-contracts, liability of principals,
latter. accomplices and accessories of a felony,
• Mere extension of time for payment given by obligations of devisees and legatees,
the creditor to a solidary debtor, does not bailees in commodatum
release others from the obligation. 3) Nature of the obligation requires solidarity.
• If prejudicial, the solidary creditor who 4) When a charge or condition is imposed upon
effected the novation shall reimburse the heirs of legatees, and the testament
others for damages incurred by them; expressly makes the charge or condition in
• If beneficial and the creditor who effected the solidum.
novation is able to secure performance shall 5) When a solidary responsibility is imputed by
be liable to the others for the share; a final judgment upon several defendants.
NOVATION in SOLIDARY OBLIGATIONS Article 1211. Solidarity may exist although the
• If effected by substituting another person in creditors and the debtors may not be bound in
place of the debtor, the solidary creditor who the same manner and by the same period and
effected the novation is liable for the acts of conditions.
the new debtor;
• In novation by subrogation, when a third
person is subrogated to the rights of the other BAR QUESTION (1971)
creditors, the creditor effecting the novation is X, Y and Z owe A and B P12,000 in a joint
liable for their share in the credit. But if the obligation. How many obligations exist in this case,
creditor subrogates a third person in his place who are the parties in each obligation and for how
such amounts to an assignment of his rights much? Why?
which he cannot do without the consent of SUGGESTED ANSWER
other creditors.
There are six obligations in the above case. The
REMISSION in SOLIDARY OBLIGATIONS parties and the amount of each obligation are:
‘Remission of entire obligation’ defined (1) X as debtor for P2,000 in favor of A as creditor;
• obligation is totally extinguished but the (2) X as debtor for P2,000 in favor of B as creditor;
(3) Y as debtor for P2,000 in favor of A as creditor;
solidary debtor who obtained it does not
(4) Y as debtor for P2,000 in favor of B as creditor;
entitle him to reimbursement from his co-
(5) Z as debtor for P2,000 in favor of A as creditor;
debtors. (6) Z as debtor for P2,000 in favor of B as creditor.
The answer is based on Art. 1208 of the Civil Code
For the benefit of one of the debtors and it which declares that if the obligation is joint, the
covers only part of his share credit or debt shall be presumed to be divided into
• his character as a solidary debtor is not as many equal shares as there are creditors or
affected. debtors, the credits or debts being considered as
distinct from one another, subject to the Rules of
‘Total or partial remission’ defined Court governing the multiplicity of suits. Take the
• creditor/s responsible for the remission are credit of P12, 000 for instance. Since there are two
liable to reimburse others for the share in the creditors there will also be two credits of P6, 000
obligation corresponding to them for each creditor. In the case of the debt of P12,
000, since there are three debtors there will also be
three debts of P4,000 against each debtor. Now,
DEFENSES in SOLIDARY OBLIGATIONS as far as A, the first creditor, is concerned, if he
1. Defenses which arise from the nature of the wants to collect his credit of P6,000, he must
obligation. proceed against all the debtors. Thus he will be
2. Defenses personal to the debtor being sued able to collect P2, 000.00 from X, P2, 000 from Y,
or pertaining only to his share. another P2, 000 from Z. The same is true in the
3. Defenses which belong to another debtor. case of B, the second creditor
BAR QUESTION (2001) 2. Jojo can be compelled by Joey to contribute

P50,000. The Civil Code provides that when
Four foreign medical students rented the one of the solidary debtors cannot, because of
apartment of Thelma for a period of one year. his insolvency, reimburse his share to the
After one semester, three of them returned to debtor paying the obligation, such share shall
their home country and the fourth transferred to be borne by all his co-debtors, in proportion to
a boarding house. the debt of each.
Thelma discovered that they left unpaid Since the insolvent debtor’s share which Joey
telephone bills in the total amount of paid was P100,000, and there are only two
P80,000.00. The lease contract provided that remaining debtors– namely Joey and Jojo –
the lessees shall pay for the telephone services these two shall share equally the burden of
in the leased premises. reimbursement. Jojo may thus be compelled by
Thelma demanded that the fourth student pay Joey to contribute P50,000.00. (Art. 1217. par.
the entire amount of the unpaid telephone bills, 3)
but the latter is willing to pay only one fourth of
it. BAR QUESTION (2012)
Who is correct? Why?
Buko, Fermin and Toti bound themselves
SUGGESTED ANSWER solidarily to pay Ayee the sum of P10,000.00.
The fourth student is correct. When the obligation became due and
His liability is only joint, hence, pro rata. demandable, Ayee sued Buko for the payment
There is solidary liability only when the of the P 10,000.00.
obligation expressly so states or when the law Buko moved to dismiss on the ground that
or nature of the obligation requires solidarity there was failure to implead Fermin and Toti
(Art. 1207, CC). The contract of lease in the who are indispensable parties. Will the motion
problem does not, in any way, stipulate to dismiss prosper? Why?
solidarity. SUGGESTED ANSWER
BAR QUESTION (2012) No, because the creditor may proceed against
anyone of the solidary debtors or some or all of
Buko, Fermin and Toti are solidary debtors them simultaneously.
under a loan obligation of P 300,000.00 which
has fallen due. The creditor has, however,
SAMPLE QUESTION
condoned Fermin’s entire share in the debt.
Since Toti has become insolvent, the creditor AA, BB, CC and DD are solidary debtors of
makes a demand on Buko to pay the debt. How creditor EE for P200,000 payable on January
much, if any, may Buko be compelled to pay? 15, 2020. Last January 15, 2020, EE
a) P 200.000.00 demanded payment of the entire loan from
b) P 300,000.00 DD. DD only paid P50,000. Can EE demand
c) P 100,000.00 from AA the payment of the remaining
d) P 150,000.00 P150,000 unpaid obligation? Explain.
a- P 200.000.00
Yes, EE can demand from AA the payment
of the remaining P150,000 unpaid obligation.
BAR QUESTION (1998) In a solidary obligation, the creditor may
Joey, Jovy and Jojo are solidary debtors under proceed against any one of the solidary
a loan obligation of P300,000.00 which has debtors or some or all of them
fallen due. The creditor has, however, simultaneously. The demand made against
condoned Jojo’s entire share in the debt. Since one of them shall not be an obstacle to those
Jovy has become insolvent, the creditor makes which may subsequently be directed against
a demand on Joey to pay the debt. the others, so long as the debt has not been
1) How much, if any, may Joey be fully collected.
compelled to pay?
2) To what extent, if at all, can Jojo be Here, AA, BB, CC and DD are solidary
compelled by Joey to contribute to such debtors of creditor EE who are liable for the
payment? entire obligation, and creditor EE is entitled to
SUGGESTED ANSWER demand the satisfaction of the whole
obligation from AA or any of the debtors for
1. Joey can be compelled to pay only the the payment of the remaining balance of
remaining balance of P200,000, in view of the P150,000. (Article 1216 of the New Civil
remission of Jojo’s share by the creditor. (Art. Code).
1219, Civil Code)
SAMPLE QUESTION BAR QUESTION (2003)
AA, BB, CC and DD are joint debtors of A,B,C,D, and E made themselves solidarily
indebted to X for the amount of P50,000.00.
creditor EE for P200,000 payable on
When X demanded payment from A, the latter
January 15, 2020. Last January 15, refused to pay on the following grounds.
2020, EE demanded payment of the a) B is only 16 years old.
entire loan from DD. DD only paid b) C has already been condoned by X
P50,000. Can EE demand from AA the c) D is insolvent.
payment of the remaining P150,000 d) E was given by X an extension of 6 months
unpaid obligation? Explain. without the consent of the other four co-
debtors.
SUGGESTED ANSWER State the effect of each of the above defenses
put up by A on his obligation to pay X, if such
No, EE cannot demand from AA the defenses are found to be true.
payment of the remaining P150,000
unpaid obligation because the obligation SUGGESTED ANSWER
is joint. (a) A may avail the minority of B as a defense,
In a joint obligation, each of the debtors but only for B’s share of P 10,000.00. A
is liable only for a proportionate part of solidary debtor may avail himself of any
the debt. Since AA is a joint debtor, he is defense which personally belongs to a solidary
co-debtor, but only as to the share of that co-
liable only for his proportionate part of
debtor.
debt, and creditor EE is entitled to
demand only a proportionate part of the (b) A may avail of the condonation by X of C’s
credit. There being four debtors, EE can share of P 10, 000.00. A solidary debtor may,
only demand P50,000 from AA, in actions filed by the creditor, avail himself of
representing his proportionate share in all defenses which are derived from the nature
the debt. (Article 1207 of the New Civil of the obligation and of those which are
personal to him or pertain to his own share.
Code)
With respect to those which personally belong
to others, he may avail himself thereof only as
SAMPLE QUESTION regards that part of the debt for which the latter
are responsible. (Article 1222, NCC).
AA, BB, CC and DD are joint creditors of
debtor EE for P200,000 payable on (c) A may not interpose the defense of
January 15, 2020. Last January 15, insolvency of D as a defense. Applying the
2020, AA demanded payment of the principle of mutual guaranty among solidary
entire loan from EE. EE only paid debtors, A guaranteed the payment of D’s
share and of all the other co-debtors. Hence, A
P50,000. cannot avail of the defense of D’s insolvency.
Can BB demand from EE the payment
of the remaining P150,000 unpaid (d) The extension of six (6) months given by X
obligation? Explain. to E may be availed of by A as a partial
defense but only for the share of E, there is no
SUGGESTED ANSWER novation of the obligation but only an act of
No, BB cannot demand from EE the liberality granted to E alone
payment of the remaining P150,000
DIVISIBLE & INDIVISIBLE OBLIGATIONS
unpaid obligation. • Obligations to give definite things and those
Under the law, the share of each of the which are not susceptible of partial
joint creditors in the credit is considered performance shall be deemed to be
distinct from one another. Each of the indivisible.
joint creditor is only entitled to collect his • When the obligation has for its object the
proportionate share of the credit. Since execution of a certain number of days of
there are four joint creditors for P200,000 work, the accomplishment of work by metrical
units, or analogous things which by their
debt, BB as a joint creditor is entitled only
nature are susceptible of partial performance,
to demand for the payment of his it shall be divisible.
proportionate share of the credit, which is • However, even though the object or service
P50,000 from EE. (Article 1208 of the may be physically divisible, an obligation is
New Civil Code) indivisible if so provided by law or intended by
the parties.
• In obligations not to do, divisibility or • However, even though the object or service
indivisibility shall be determined by the may be physically divisible, an obligation is
character of the prestation in each particular indivisible if so provided by law or intended
case. by the parties. (Emphasis supplied)
• In Nazareno v. Court of Appeals, the
SPS. LAM V KODAK PHILIPPINES, LTD. indivisibility of an obligation is tested against
G.R. NO. 167615, JANUARY 11, 2016 whether it can be the subject of partial
Facts: performance: An obligation is indivisible
• On January 8, 1992, Sps. Lam and Kodak when it cannot be validly performed in parts,
Philippines, Ltd. entered into a Letter whatever may be the nature of the thing
Agreement for the sale of three units of the which is the object thereof. The indivisibility
Kodak Minilab System 22XL6 (Minilab refers to the prestation and not to the object
Equipment) in the amount of ₱1,796,000.00 thereof. In the present case, the Deed of Sale
per unit.
of January 29, 1970 supposedly conveyed
• On January 15, 1992, Kodak delivered one (1)
the six lots to Natividad. The obligation is
unit of the Minilab Equipment in Tagum,
clearly indivisible because the performance of
Davao Province. The delivered unit was
the contract cannot be done in parts,
installed by Noritsu representatives on March
otherwise the value of what is transferred is
9, 1992. Sps. Lam issued postdated checks
diminished. Petitioners are therefore
amounting to ₱35,000.00 each for 12 months
as payment for the first delivered unit, with the mistaken in basing the indivisibility of a
first check due on March 31, 1992. contract on the number of obligors. There is
• Sps. Lam requested that Kodak not negotiate no indication in the Letter Agreement that the
the check dated March 31, 1992 allegedly due units petitioners ordered were covered by
to insufficiency of funds. The same request three (3) separate transactions.
was made for the check due on April 30. • The factors considered by the Court of
However, both checks were negotiated by Appeals are mere incidents of the execution
Kodak and were honored by the depository of the obligation, which is to deliver three
bank. The other checks were subsequently units of the Minilab Equipment on the part of
dishonored after the Sps. Lam ordered the respondent and payment for all three on the
depository bank to stop payment. part of petitioners. The intention to create an
• Kodak canceled the sale and demanded that indivisible contract is apparent from the
Sps. Lam return the unit it delivered together benefits that the Letter Agreement afforded to
with its accessories. Sps. Lam ignored the both parties. Petitioners were given the 19%
demand but also rescinded the contract discount on account of a multiple order, with
through the letter dated November 18, 1992 the discount being equally applicable to all
on account of Kodak Philippines, Ltd.’s failure units that they sought to acquire. The
to deliver the two remaining Minilab Equipment provision on "no downpayment" was also
units. applicable to all units. Respondent, in turn,
Issue: was entitled to payment of all three Minilab
WoN the contract between the parties pertained Equipment units, payable by installments.
to obligations which are divisible, suceptible of
partial performance under Article 1225 of the PARTIAL PERFORMANCE
New Civil Code. General Rule: Creditor cannot be compelled
Ruling: partially to receive the prestation; neither may
• The Letter Agreement contained an indivisible the debtor be required to make partial
obligation. Through the specified terms and payments.
conditions, the tenor of the Letter Agreement XPN:
indicated an intention for a single transaction. • When the obligation expressly stipulates the
This intent must prevail even though the contrary;
articles involved are physically separable and
• When the different prestations constituting
capable of being paid for and delivered
the objects of the obligation are subject to
individually, consistent with the New Civil
different terms and conditions;
Code:
• When the obligation is in part liquidated and
• Article 1225. For the purposes of the
in part unliquidated
preceding articles, obligations to give definite
things and those which are not susceptible of
partial performance shall be deemed to be Joint Indivisible Obligation [Article 1209]
indivisible. • The obligation is joint as to parties but
• When the obligation has for its object the indivisible as to compliance.
execution of a certain number of days of work, • Obligation preserves its character of being
the accomplishment of work by metrical units, joint in case of plurality of subjects
or analogous things which by their nature are notwithstanding its indivisibility of the object
susceptible of partial performance, it shall be or prestation.
divisible.
Consequences of Joint Indivisible Obligation XPN:

• Can be enforced only by proceeding against • When there is express stipulation to the
all debtors. contrary;
• Collective action of all creditors is necessary • When the obligor refuses to pay the penalty,
to enforce the credit. in which case the creditor is entitled to
• In case one of the debtors refused – interest in the amount of penalty;
converted into indemnity to pay the value of • When the obligor is guilty of fraud
the thing or service due, where each debtors
will pay their proportionate share, and General Rule: The penalty is not a substitute for
damages to be shouldered by the debtor at the performance of the obligation.
fault. XPN: When expressly reserved for the debtor.
SAMPLE QUESTION General Rule: The creditor cannot demand the

AA, BB, CC and DD are joint debtors of creditor fulfillment of the obligation and the satisfaction of
EE for the delivery on January 15, 2020 of a the penalty at the same time.
determinate horse that won the 2019 racing XPN: The creditor may only be entitled to both
competition. Last January 15, 2020, EE rights if the same has been clearly granted to
demanded the delivery of the horse upon all of him.
the joint debtors. While AA, BB, and CC were
ready to deliver, DD however refused to comply When court may reduce the penalty
with the obligation. Judge may reduce penalty:
What is/are the legal implication/s of DD’s • Principal obligation has been partly/
refusal. Explain. irregularly complied;
• Even if no performance, the penalty may also
SUGGESTED ANSWER be reduced if iniquitous/ unconscionable.
If anyone of the debtors in a joint indivisible [Article 1229]
obligation should fail to comply with his
undertaking, the obligation is converted into SSS VS. MOONWALK DEVELOPMENT AND
one of indemnity for damages. HOUSING CORPORATION
However, debtors AA, BB and CC who were G.R. NO. 73345, APRIL 7, 1993
ready to comply with what is incumbent upon • A penal clause is an accessory undertaking to
them shall not contribute to the indemnity assume greater liability in case of breach. It
beyond the corresponding portion of the price has a double function: (1) to provide for
of the thing or of the value of the service in liquidated damages, and (2) to strengthen the
which the obligation consists. coercive force of the obligation by the threat
On the other hand, debtor DD who failed or of greater responsibility in the event of
refused to comply with his undertaking shall breach.
pay not only his share of such price or value, • From the foregoing, it is clear that a penal
but also all of the damages suffered by the clause is intended to prevent the obligor from
creditor EE as a result of the nonfulfillment of defaulting in the performance of his
the obligation. (Article 1224, New Civil Code). obligation. Thus, if there should be default,
the penalty may be enforced.
6) OBLIGATIONS WITH A PENAL CLAUSE D. EXTINGUISHMENT OF

It is one with an accessory undertaking by virtue
of which the obligor assumes a greater liability in
OBLIGATIONS
case of breach of obligation.
Modes of Extinguishment of Obligations:
‘Penal Clause’ defined 1. Payment/performance
• It is an accessory undertaking to assume 2. Loss of the thing due
greater liability in case of breach. It has a 3. Condonation or remission of debt
double function: 4. Confusion or merger
• to provide for liquidated damages, and; 5. Compensation
• to strengthen the coercive force of the 6. Novation
obligation by the threat of greater 7. Annulment, Rescission, Fulfillment of a
responsibility in the event of breach. resolutory condition, Prescription.
• intended to prevent the obligor from defaulting
in the performance of his obligation. Thus, if 1. PAYMENT
there should be default, the penalty may be
enforced. a) CONCEPT OF PAYMENT
‘Payment’ defined
General Rule: The penalty shall substitute the • Payment means not only the delivery of
indemnity for damages and payment of interest money but also the performance, in any other
manner, of an obligation. [Article 1232]
Requisites of Payment: 3) If payor does not intend to be reimbursed,

1. Integrity (Must be complete and regular); it is deemed to be a donation which
2. Tendered by the proper party; requires the debtor’s consent; the
3. Paid to proper person; payment, however, is in any case valid as
4. Party must have capacity to pay; to the creditor who has accepted. [Article
5. Capacity of recipient; 1238]
6. Identity of prestation must be preserved;
7. Tendered in the proper place.
Incapacitated Payor
• In obligations to give, payment made by one
1. INTEGRITY (Must be complete and regular)
who does not have the free disposal of the
• A debt shall not be understood to have been
thing due and capacity to alienate it shall not
paid unless the thing or service in which the
be valid, without prejudice to the provisions
obligation consists has been completely
delivered or rendered, as the case may be. of article 1427 under the Title on "Natural
(1233) Obligations.” (Article 1239)
General Rule: Partial performance is breach, an • 1427 – Article 1427. When a minor between
offer of partial performance can be refused by eighteen and twenty-one years of age, who
the creditor. Debtor cannot be also demanded has entered into a contract without the
to make partial payments. consent of the parent or guardian, voluntarily
XPN: Partly liquidated (1248) pays a sum of money or delivers a fungible
thing in fulfillment of the obligation, there
Exceptions to the rule of integrity: shall be no right to recover the same from
1. Substantial performance in good faith - If the the obligee who has spent or consumed it in
obligation has been substantially performed in good faith.
good faith, the obligor may recover as though • Dead letter since age of majority now is 18.
there had been a strict and complete • In either case the debtor may later ratify or
fulfillment, less damages suffered by the validate the payment previously made. This
obligee. (1234) right belongs to the debtor not the creditor.
2. Waiver by creditor - When the obligee
accepts the performance, knowing its 3. PAID TO PROPER PERSON
incompleteness or irregularity, and without Payment shall be made to the person in whose
expressing any protest or objection, the favor the obligation has been constituted, or his
obligation is deemed fully complied with. successor in interest, or any person authorized
(1235) to receive it. (1240)
3. Application of Payment (1254)
Effect of Payment to Unauthorized Persons
2. TENDERED BY THE PROPER PARTY in Obligation to Give
• The creditor is not bound to accept payment General Rule: It shall NOT be valid, even
or performance by a third person who has no though made in good faith.
interest in the fulfillment of the obligation, XPN:
unless there is a stipulation to the contrary. • Payment redounded to the benefit of the
(1236) creditor.
• From the debtor himself or from his duly • Payment to the possessor of the credit,
authorized representative; made in good faith
• From a third person who has been authorized
• Debtor pays previous creditor without notice
by the parties to make payment;
of the assignment of credit made by the
• From a third person who has an interest in the
latter.
fulfillment of the obligation (guarantor, surety,
creditor paying a preferred creditor)
Presumption of Benefit to the Creditor
Effect of Payment by a Third Person not
• If after the payment, the third person
interested in the fulfillment acquires the creditor’s rights;
1) The creditor is not bound to accept • If the creditor ratifies the payment to the third
payment, unless there is a stipulation to person;
the contrary • If by the creditor’s conduct, the debtor has
2) If creditor accepted the payment: been led to believe that the third person had
• Without knowledge or against the will authority to receive the payment.
of the debtor – the payor may demand
reimbursement only up to the amount Incapacitated Creditor
beneficial to the debtor; payor has no Payment to a person who is incapacitated to
right of subrogation administer his property shall be valid if he has
• With knowledge or consent of debtor kept the thing delivered, or insofar as the
– payor has rights of full reimbursement payment has been beneficial to him. (Article
and subrogation (Art 1236) 1241)
Payment by debtor after judicial order to 5. TENDERED IN THE PROPER PLACE

retain the debt • Place stipulated by the parties
● Payment made to the creditor by the • If there is no stipulation, obligation is to deliver
debtor after the latter has been judicially a determinate thing, payment shall be made at
ordered to retain the debt shall not be the place where the thing might be at the time
valid. (Article 1243) the obligation was constituted.
• In any other case, the payment shall be made
at the domicile of the debtor.
4. IDENTITY OF PAYMENT
• The debtor of a thing cannot compel the
Application of Payment
creditor to receive a different one, although Designation of the debt to which the payment
the latter may be of the same value as, or must be applied when the debtor has several
more valuable than that which is due. obligations of the same kind in favor of the same
• In obligations to do or not to do, an act or creditor.
forbearance cannot be substituted by
another act or forbearance against the Requisites of Application of Payment
obligee's will. (1244) • There must be only one debtor and only one
• When the obligation consists in the delivery creditor;
of an indeterminate or generic thing, whose • There must be two or more debts of the same
quality and circumstances have not been kind;
stated, the creditor cannot demand a thing of • All the debts must be due, except if there is
superior quality. Neither can the debtor stipulation to the contrary OR application of
deliver a thing of inferior quality. The payment is made by the party for whose
purpose of the obligation and other benefit the term has been constituted
circumstances shall be taken into • Amount paid by the debtor is insufficient to
cover the total amount of all the debts.
consideration. (1246)
• Cathay Pacific Airways, Ltd. vs. Sps.
Rules on Application of Payment
Vazquez 399 SCRA 207 – business class to
• Debtor has the right to select which of his
first class debts he is paying. He must indicate at the
time of making payment, and not afterwards,
Exceptions: which particular debt is being paid;
1. Dacion en pago • The right to make the application once
2. Novation exercised is irrevocable unless the creditor
consents to the change;
DEBTS IN MONEY • If not, the creditor makes the application, by so
• The payment of debts in money shall be stating in the receipt that he issues, unless
made in the currency stipulated, and if it is there is cause for invalidating the contract;
not possible to deliver such currency, then in • If the creditor has not also made the
the currency which is legal tender in the application, or the application is not valid, the
Philippines. application is made by operation of law;
• The delivery of promissory notes payable to • If debt produces interest, the payment is not to
order, or bills of exchange or other be applied to the principal unless the interests
mercantile documents shall produce the are covered;
• When no application can be inferred from the
effect of payment only when they have been
circumstances of payment, it is applied: (a) to
cashed, or when through the fault of the
the most onerous debt of the debtor; or (b) if
creditor they have been impaired. (1249)
debts due are of the same nature and burden,
• In case an extraordinary inflation or deflation to all the debts in proportion.
of the currency stipulated should supervene,
the value of the currency at the time of the Limitations on Application of Payment
establishment of the obligation shall be the • In Article 1248, the creditor has the right to
basis of payment, unless there is an refuse partial payment - the creditor cannot be
agreement to the contrary. (1250) compelled partially to receive the prestations in
• Extraordinary inflation or deflation exists which the obligation consists. Neither may the
when there is a decrease or increase in debtor be required to make partial payments.
purchasing power of the currency which is • Article 1253 - If the debt produces interest,
unusual or beyond the common fluctuation in payment of the principal shall not be deemed
value of said currency, not reasonable to have been made until the interests have
foreseen or was beyond the contemplation been covered.
of the parties. This requires an official • Also, debtor cannot apply payment to a debt
pronouncement or declaration by competent which is not yet liquidated. He cannot choose
authorities. (Telengtan Bros. vs US Lines, a debt with a period (established for the
creditor’s benefit) before the period has
483 SCRA 458)
arrived.
b) PAYMENT BY CESSION VS. DATION IN • STRICT COMPLIANCE is required

PAYMENT • Prior to acceptance by creditor or declaration
PAYMENT BY by court, debtor may withdraw the thing or
DATION IN PAYMENT sum deposited allowing the debt to remain
CESSION
Consists in the It requires delivery and • If creditor allowed withdrawal, he will lose
abandonment of the transmission of preference over the thing or sum deposited.
totality of the property ownership of a thing • If valid, expenses are chargeable against the
of the debtor in favor owned by the debtor to creditor. If invalid, expenses shall be against
of the creditors in the creditor as an the debtor, and accrual of interest continues.
order that the same accepted equivalent of
may be applied for the the performance of the B.E. SAN DIEGO, INC. V AZUL
satisfaction of their obligation. G.R. NO. 169501, JUNE 8, 2007
credits. It must be borne in mind however that a mere
Governed by the law on tender of payment is not enough to extinguish
Unless there is a sales. Obligation is an obligation. In Meat Packing Corporation of
stipulation to the extinguished up to the the Philippines v. Sandiganbayan, we
contrary, cession shall value of the property distinguished consignation from tender of
only release the conveyed, unless payment and reiterated the rule that both must
debtor from stipulation that be validly done in order to effect the
responsibility for the conveyance shall extinguishment of the obligation, thus:
net proceeds of the extinguish entire
thing assigned. obligation. Consignation is the act of depositing the thing
due with the court or judicial authorities
c) TENDER OF PAYMENT AND
CONSIGNATION
whenever the creditor cannot accept or refuses
‘Consignation’ defined to accept payment, and it generally requires a
It is the act of depositing the thing due with the prior tender of payment. It should be
court or judicial authorities whenever the creditor distinguished from tender of payment. Tender
cannot accept or refuses to accept without just is the antecedent of consignation, that is, an act
cause payment and it generally requires a prior preparatory to the consignation, which is the
tender of payment. principal, and from which are derived the
immediate consequences which the debtor
‘Tender of payment’ defined desires or seeks to obtain. Tender of payment
It is the act of offering to the creditor what is due may be extrajudicial, while consignation is
him, together with the demand for the creditor to necessarily judicial, and the priority of the first
accept it. To be valid, the tender of payment is the attempt to make a private settlement
must be a "fusion of intent, ability, and capability before proceeding to the solemnities of
to make good such offer, which must be consignation. Tender and consignation, where
absolute and must cover the amount due.“ validly made, produces the effect of payment
and extinguishes the obligation. There is no
When Consignation alone is sufficient dispute that a valid tender of payment had been
• When the creditor is absent or unknown, or made by respondent. Absent however a valid
does not appear at the place of payment; consignation, mere tender will not suffice to
• When he is incapacitated to receive the extinguish her obligation and consummate the
payment at the time it is due; acquisition of the subject properties.
• When, without just cause, he refuses to give a
receipt; 2.) LOSS OF THE THING DUE
• When two or more persons claim the same
right to collect; a) CONCEPT OF LOSS
• When the title of the obligation has been lost. ‘Thing Lost’ defined
• A thing is lost “when it perishes, or goes out
Requisites of effective consignation
of commerce, or disappears in such a way
• There is a debt due.
that its existence is unknown or (even if
• Creditor to whom tender of payment was
known) it cannot be recovered”. [Article
made refused to accept it without justifiable
1189]
cause, or he was absent, incapacitated of
• In obligations to do, the equivalent term of
because several persons are claiming or title
to obligation has been lost.
loss is “impossibility”.
• (1st Notice) Previous notice of consignation
has been given to person interested in the ART 1262. An obligation which consists in the
performance of obligation. delivery of a determinate thing shall be
• Amount is placed at the disposal of court. extinguished if it should be lost or destroyed
• (2nd Notice) After consignation, person without the fault of the debtor, and before he
interested was notified of the action. has incurred in delay.
When Loss of Thing Will Not Extinguish Explanation of Article 1265

Liability • This article establishes a disputable
There are cases, however, when the loss of the presumption of fault whenever the thing to be
specific thing even in the absence of fault and delivered is lost in the possession of the
delay will not exempt the debtor from liability. debtor.
They are: • This presumption is reasonable because the
1) when the law so provides [Articles 1170, debtor who has the custody and care of the
1165 [par. 3], 1263]; thing can easily explain the circumstances of
2) when the stipulation so provides; the loss. The creditor has no duty to show
3) when the nature of the obligation requires that the debtor was at fault. It is the debtor
the assumption of risk [par. 2; Article who must prove that he was not at fault.
1174]; and
4) when the obligation to deliver a specific CO V COURT OF APPEALS
thing arises from a crime. [Article 1268] G.R. NO. 124922 JUNE 22, 1998
Facts:
Effect of Loss of a Generic Thing • On July 18, 1990, petitioner entrusted his
In an obligation to deliver a generic thing, the Nissan pick-up car 1988 model to private
loss or destruction of anything of the same kind respondent — which is engaged in the sale,
does not extinguish the obligation. [Article 1263] distribution and repair of motor vehicles — for
job repair services and supply of parts.
General Rule: The debtor can still be compelled Private respondent undertook to return the
to deliver a thing of the same kind. The creditor, vehicle on July 21, 1990 fully serviced and
however, cannot demand a thing of superior supplied in accordance with the job contract.
quality and neither can the debtor deliver a thing After petitioner paid in full the repair bill in the
of inferior quality. [Article 1246] amount of P1,397.00 private respondent
issued to him a gate pass for the release of
Effect of Partial Loss of a Specific Thing the vehicle on said date. But came July 21,
‘Partial loss’ defined 1990, the latter could not release the vehicle
• Courts may determine whether, under the as its battery was weak and was not yet
given circumstances, such loss is so replaced. Left with no option, petitioner
important as to extinguish the obligation. himself bought a new battery nearby and
[Article 1264] delivered it to private respondent for
• Neither partial loss of the thing nor extreme installation on the same day. However, the
difficulty in an obligation to do authorize the battery was not installed and the delivery of
courts to remake or revise the contract; the car was rescheduled to July 24, 1990 or
circumstances may only serve to release the three (3) days later.
debtor from his obligation in whole or in part. • When petitioner sought to reclaim his car in
• In contracts, where the impossibility of things the afternoon of July 24, 1990, he was told
and services occur prior to perfection, no that it was carnapped earlier that morning
obligation is deemed constituted and loss while being road-tested by private
prevents the contract from acquiring respondent's employee along Pedro Gil and
obligatory force. [Article 1348 & 1409] Perez Streets in Paco, Manila. Private
respondent said that the incident was
Presumption of Fault In Case of Loss of reported to the police.
Thing in Possession of the Debtor • Having failed to recover his car and its
General Rule: Whenever the thing is lost in the accessories or the value thereof, petitioner
possession of the debtor, it shall be presumed filed a suit for damages against private
that the loss was due to his fault. respondent anchoring his claim on the latter's
XPN: Unless there is proof to the contrary, and alleged negligence. For its part, private
without prejudice to the provisions of Article respondent contended that it has no liability
1165. [Article 1265] because the car was lost as result of a
fortuitous event — the carnapping.
When Presumption of Fault In Case of Loss Issue:
of Thing in Possession of the Debtor Does WoN the repair shop is answerable for the loss.
Not Apply Ruling:
This presumption does not apply in case of: Assuming further that there was no delay, still
• Earthquake; working against private respondent is the legal
• Flood; presumption under Article 1265 that its
• Storm; or possession of the thing at the time it was lost
• Other natural calamity. was due to its fault. This presumption is
reasonable since he who has the custody and
Rationale: Lack of fault on the part of the debtor care of the thing can easily explain the
is more likely. So it is unjust to presume circumstances of the loss. The vehicle owner
negligence on his part. has no duty to show that the repair shop was at
fault. All that petitioner needs to prove, as Effect if Obligation is Impossible From the
claimant, is the simple fact that private Very Beginning
respondent was in possession of the vehicle at If the obligation is impossible from the very
the time it was lost. In this case, private beginning, the obligation is void. [Article 1183
respondent's possession at the time of the loss and 1348] In such a case, there is no obligation
is undisputed. to be extinguished.
Consequently, the burden shifts to the Note: Article 1266 makes express reference to
possessor who needs to present controverting obligations to do or personal obligations. In
evidence sufficient enough to overcome that obligations not to do, impossibility of
presumption. Moreover, the exempting performance can hardly take place.
circumstances — earthquake, flood, storm or
other natural calamity — when the Effect of Difficulty of Performance
presumption of fault is not applicable do not When the service has become so difficult as to
concur in this case. Accordingly, having failed be manifestly beyond the contemplation of the
to rebut the presumption and since the case parties, the obligor may also be released
does not fall under the exceptions, private therefrom, in whole or in part. [Article 1267]
respondent is answerable for the loss. Xxx
Doctrine of Unforeseen Events/ Rebus Sic
It must likewise be emphasized that pursuant Stantibus
to Articles 1174 and 1262 of the New Civil • performance of the prestation, though not
Code, liability attaches even if the loss was impossible, has become so manifestly and
due to a fortuitous event if "the nature of the extremely difficult as to be beyond the
contemplation of the parties.
obligation requires the assumption of risk".
• When the performance of the service has
Carnapping is a normal business risk for those
become so difficult as to be manifestly
engaged in the repair of motor vehicles. For
beyond the contemplation of both parties,
just as the owner is exposed to that risk so is
the court is authorized to release the obligor
the repair shop since the car was entrusted to
in whole or in part. It would be doing
it.
violence to the intention of the parties to hold
the obligor still responsible. (see Report of
Impossibility of Performance
the Code Commission, p. 133.)
The debtor in obligations to do shall also be
released when prestation becomes legally or PHILIPPINE NATIONAL CONSTRUCTION
physically impossible without the fault of the CORPORATION V COURT OF APPEALS
obligor. (1266) G.R. NO. 116896, MAY 5, 1997
Ruling:
Effect of Impossibility of Performance • It is a fundamental rule that contracts, once
General Rule: Obligations arising from perfected, bind both contracting parties, and
contracts have the force of law between the obligations arising therefrom have the force
contracting parties and should be complied of law between the parties and should be
with in good faith. [Article 1159] complied with in good faith. But the law
XPN: The debtor in obligations to do shall also recognizes exceptions to the principle of the
be released when the prestation becomes obligatory force of contracts. One exception
legally or physically impossible without the is laid down in Article 1266 of the Civil Code.
fault of the obligor. [Article 1266] Petitioner cannot, however, successfully
take refuge in the said article, since it is
if Obligor Has No Fault applicable only to obligations "to do," and not
An obligation to do so becomes legally or to obligations "to give."
physically impossible which will result in the • The obligation to pay rentals or deliver the
extinction of the debtor’s obligation after thing in a contract of lease falls within the
restitution of what he may have received, if prestation "to give"; hence, it is not covered
any, in advance from the other contracting within the scope of Article 1266.
party. • At any rate, the unforeseen event and
causes mentioned by petitioner are not the
Liability Of The Debtor For Impossibility Of legal or physical impossibilities contemplated
Performance in the said article. Besides, petitioner failed
The debtor incurs no liability for his inability to to state specifically the circumstances
perform. brought about by "the abrupt change in the
political climate in the country" except the
When Must Impossibility Take Place alleged prevailing uncertainties in
This impossibility must take place after the government policies on infrastructure
constitution of the obligation. projects.
• The principle of rebus sic stantibus neither fits • Loss of the thing is partly due to the fault of
in with the facts of the case. Under this the debtor;
theory, the parties stipulate in the light of • Loss of the thing occurs after the debtor
certain prevailing conditions, and once these incurred in delay;
conditions cease to exist, the contract also • When the debtor promised to deliver the
ceases to exist. same thing to two persons who do not have
• This theory is said to be the basis of Article the same interest;
1267 of the Civil Code, which provides: • When the obligation to deliver arises from a
• Art. 1267. When the service has become so criminal offense; and
difficult as to be manifestly beyond the • When the object of the obligation is generic.
contemplation of the parties, the obligor may
also be released therefrom, in whole or in
c) FORCE MAJEURE
part.
• A fortuitous event may either be an "act of
• This article, which enunciates the doctrine of
God," or natural occurrences such as floods
unforeseen events, is not, however, an
or typhoons, or an "act of man," such as riots,
absolute application of the principle of rebus
strikes or wars.
sic stantibus, which would endanger the
• The terms caso fortuito and force majeure
security of contractual relations. The parties
are identical in so far as they exempt an
to the contract must be presumed to have
obligor from liability. Both terms refer to
assumed the risks of unfavorable
causes independent of the will of the obligor.
developments. It is therefore only in
absolutely exceptional changes of
• They refer to extraordinary events not
circumstances that equity demands
foreseeable or avoidable, "events that could
assistance for the debtor. not be foreseen, or which, though foreseen,
were inevitable" (Art. 1174 NCC)
Right of Creditor To Proceed Against Third • Caso fortuito is a fortuitous event
Persons independent of the will of the obligor but not
• The creditor is given the right to proceed of other human wills. example of this are war,
against the third person responsible for the fire, robbery, and murder.
loss. • Force majeure are events which are totally
• There is no need for an assignment by the independent of the will of every human being.
debtor. The rights of action of the debtor are The term generally applies to a natural
transferred to the creditor from the moment accident. example of this are earthquake,
the obligation is extinguished, by operation of flood, lightning, and volcano eruption.
law to protect the interest of the latter by • The event must be such as to render it
reason of the loss. [Article 1269] impossible for the debtor to fulfill his
obligation in a normal manner; and, The party
Rule if Obligation Arises from a Criminal claiming did not participate in, nor aggravate,
Offense the injury to the other party.
General Rule: When the debt of a thing certain
and determinate proceeds from a criminal Article 1174 of the Civil Code of the
offense, the debtor shall not be exempted from Philippines
the payment of its price, whatever may be the General Rule: No person shall be responsible
cause of loss. for those events which could not be foreseen, or
XPN: Unless the thing having been offered by which, though foreseen, were inevitable
him to the person who should receive it, the XPN:
latter refused without justification to accept it. (a) it is specified by law;
[Article 1268] (b) it is otherwise declared by stipulation; and
(c) the obligation requires the assumption of
b) REQUISITES risk.
In order that an obligation to give may be
extinguished by the loss of the thing, the To exempt the obligor from liability for a breach
following requisites must be present: of an obligation due to force majeure, the
• The obligation is to deliver a specific or following requisites must likewise concur:
determinate thing; • the cause of the breach of the obligation
• The loss of the thing occurs without the fault must be independent of the will of the debtor;
of the debtor; and • the event must be either unforeseeable or
• The debtor is not guilty of delay. [Article 1262] unavoidable;
XPN: • the event must be such as to render it
• When the law so provides; impossible for the debtor to fulfill his
• When the stipulation so provides; obligation in a normal manner; and
• When the nature of the obligation requires an • the debtor must be free from any participation
assumption of risk; in, or aggravation of the injury to the creditor.
3) CONDONATION 5) COMPENSATION
‘Condonation’ defined ‘Compensation’ defined
• An act of liberality of the obligee, without • It is the extinguishment to the concurrent
receiving any price or equivalent, renounces amount of the debts of two persons who, in
the enforcement of the obligation, is their own right, are reciprocally principal
extinguished in its entirety or part. debtors and creditors of each other.
• May be made expressly or impliedly. • It involves the simultaneous balancing of
two obligations in order to totally extinguish
Requisites of Condonation them if they are of the same amount or to
• It must be gratuitous; the extent in which the amount of one is
• It must be accepted by the obligor; covered by that of the other, if of different
• The obligation must be demandable at the amounts.
time of remission;
• Parties must have the capacity; When Shall Compensation Take Place
• Not inofficious; and Compensation shall take place when two
• If it is made expressly, must comply with the persons, in their own right, are creditors and
forms of donation debtors of each other. [Article 1278]
Effect of Renunciation to Principal Debt Amount of Compensation

Renunciation of principal debt shall extinguish a) Total Compensation - Compensation may
the accessory obligations. The waiver of the be total if two debts are of the same
accessory shall leave the principal in force. amount.
[Article 1273] b) Partial Compensation - Partial if two
debts vary in amounts
Effect of Delivery Of Private Document Compensation shall only be to the extent of
Evidencing a Credit the concurrent amount.
Implies the renunciation of the action which the
former had against the latter [Article 1271] Kinds of Compensation
a) Legal – by operation of law
Note: Delivery of a private document b) Conventional – by agreement, mutual set-
evidencing a credit must be made voluntarily by off of obligations
the creditor to the debtor. c) Judicial – by judgment of court
Presumption of Voluntary Delivery a) REQUISITES OF LEGAL

Whenever a private document in which the debt COMPENSATION
appears is found in possession of the debtor, it 1) The parties must be creditors and
shall be presumed that the creditor delivered it
debtors of each other in their own right.
voluntarily unless the contrary is proved.
2) The parties must be bound principally.
[Article 1272]
3) Both debts consist of a sum of money, or
if the things due are consumable, they be
Note: Possession of the instrument of credit by
of the same kind, and also the same
the creditor is prima facie proof of non-
quality if the latter has been stated.
payment.
4) Both debts must be due, liquidated and
demandable.
4) CONFUSION
5) Over neither of them there be retention or
‘Confusion’ defined
controversy, commenced by third
It is the merger of the characters of the creditor
persons and communicated in due time
and the debtor in one and the same person by
to the debtor.
virtue of which the obligation is extinguished.
Effect When All Requisites of Legal
Requisites of Confusion
Compensation Occur
a. It must take place in the person of the
• Compensation takes place by operation of
principal creditor and principal debtor.
law
b. It must be complete and definite because
• Extinguishes both debts to the concurrent
if not complete the obligation still subsists.
amount, even though the creditors and
debtors are not aware of compensation and
General Rule: Confusion does not extinguish a
even though the debts may be payable at
joint obligation.
different places, but there shall be indemnity
XPN: Except as regards the share
for expenses of exchange or transportation
corresponding to the creditor or debtor in whom
to the place of payment. (Arts 1290 & 1286
the two characters concur. [Article 1277]
NCC)
b) COMPENSATION OF RESCISSIBLE 6. NOVATION

AND VOIDABLE DEBTS ‘Novation’ defined
General Rule: When one or both debts are • It is a change in the elements of an obligation.
rescissible or voidable, they may be • It is the total or partial extinction of an
compensated against each other. obligation through the creation of a new one
which substitutes it.
• before the debts are judicially rescinded
• It is the substitution or change of an obligation
or avoided. [Article 1284]
by another, which extinguishes or modifies
the first, either by changing its object or
Example: principal conditions, by or substituting another
Q: A owes B 10,000 pesos. B owes A 5,000, in place of the debtor, or by subrogating a
but this loan was obtained when B was still third person in the rights of the creditor.
16 years old.
A: The debt of A is valid but that of B is a) CONCEPT OF NOVATION
voidable. Before the debt of B is annulled, It is the extinguishment of an obligation by the
both debts may be compensated against substitution or change of:
each other up to the concurrent amount of • An obligation by a subsequent one which
5,000 if all the requisites for legal extinguishes or modifies the first either by
changing the object or principal conditions;
compensation are present.
• By substituting another in the place of the
debtor;
c) NON-COMPENSABLE DEBTS • By subrogating a third person in the rights of
Obligations Which Cannot Be the creditor (Art 1291 NCC)
Compensated
Expressed in Articles 1287 and 1288 of the Nature of Novation
Civil Code. • Extinctive Novation - It is EXTINCTIVE
• Article 1287. Compensation shall not be when the old obligation is extinguished by the
proper when one of the debts arises from creation of a new one that takes place of the
a depositum or from the obligations of a former;
depositary or of a bailee in commodatum. • Modificatory Novation - It is
MODIFICATORY when the old obligation
Neither can compensation be set up
subsists, as amended, to the extent it remains
against a creditor who has a claim for
compatible with the novatory agreement.
support due by gratuitous title, without
prejudice to the provisions of paragraph 2 Kinds of Novation According to Subject
of Article 301. • Real or Objective Novation — occurs when
• Article 1288. Neither shall there be there is a change of the object or principal
compensation if one of the debts consists conditions of an existing obligation;
in civil liability arising from a penal • Personal or Subjective Novation — occurs
offense. when there is a change of either the person of
the debtor or of the creditor in an existing
The obligations which cannot be obligation;
• Mixed — occurs when the object or principal
compensated are as follows:
condition of the obligation and the debtor or
1) Contract of depositum;
the creditor or both the parties, are changed.
• A special real contract whereby the It is a combination of real and personal
depositor entrusts to the depository novations.
something for safe keeping.
2) Contract of commodatum; Effect of Novation
• A gratuitous contract whereby one • Mere extension of time for payment given by
of the parties delivers to another the creditor to a solidary debtor, does not
something not consumable so that release others from the obligation.
the latter may use the same for a • If prejudicial, the solidary creditor who
certain time and return it. effected the novation shall reimburse the
others for damages incurred by them;
3) Future support due by gratuitous title;
• If beneficial and the creditor who effected the
• The right to receive support cannot
novation is able to secure performance, he
be waived nor transferred because shall be liable to the others for their shares;
support is necessary for • If effected by substituting another person in
subsistence and the right is purely place of the debtor, the solidary creditor who
personal to the recipient. effected the novation is liable for the acts of
4) Civil liability arising from a penal clause the new debtor;
cannot be compensated.
Novation of an Obligation by Substituting the • CCCIC failed to discharge the burden of

Person of the Debtor proving novation of the Consortium
Entails the replacement of the debtor by a third Agreement by the Agreement dated August
person. 24, 1989. The Court failed to see the
presence of the essential requisites for a
Effect of a Valid Substitution novation of contract, specifically, the
When validly made, it releases the debtor from irreconcilable incompatibility between the old
the obligation which is then assumed by the third and new contracts.
person as the new debtor.
(1) Requisites
How To Effect of a Valid Substitution Essential Requisites of Novation
It is not enough for the debtor to merely assign
a. The existence of a previous valid
his debt to a third person, or for the latter to
obligation;
assume the debt of the former; the consent of the
b. The intention or agreement and capacity of
creditor to the substitution of the debtor is
the parties to extinguish or modify the
essential and must be had.
obligation;
c. The extinguishment or modification of the
b) EXPRESSED AND IMPLIED NOVATION
obligation; and
‘Express Novation’ defined
d. The creation or birth of a valid new
• When the new obligation declares in
obligation.
unequivocal terms that the old obligation is
extinguished
General Rule: There can be no novation unless
‘Implied Novation’ defined two distinct and successive binding contracts
• When the new obligation is on every point take place, between the same parties with the
incompatible with the old one. second designed to replace the preceding
• When not expressed, incompatibility is convention.
required so as to ensure that the parties did
really intend such novation despite their failure c) EXPROMISION AND DELEGACION
to express it in categorical terms. DISTINGUISHED
Two Forms of Novation by Substitution of
CCC INSURANCE CORPORATION V the Debtor
KAWASAKI STEEL CORPORATION 1) Expromission
G.R. NO. 156162, JUNE 22, 2015 • The initiative does NOT come from the
Issue: original debtor.
WoN there was novation of the Consortium • It may be made WITHOUT original
Agreement. debtor’s knowledge or against his will
Ruling: • Consent of the creditor and the third
• It is well-settled that novation is never person is required
presumed - novatio non praesumitur. As the • Insolvency of the new debtor in
party alleging novation, the onus of showing expromission
clearly and unequivocally that novation had • If substitution is without the knowledge or
indeed taken place rests on CCCIC. against the will of the original debtor, the
• There are two ways which could indicate, in new debtor’s insolvency or non-fulfillment
fine, the presence of novation and thereby of the obligation shall not give rise to any
produce the effect of extinguishing an
liability on the part of the original debtor.
obligation by another which substitutes the
[Article 1294]
same. The first is when novation has been
2) Delegacion
explicitly stated and declared in unequivocal
• The debtor initiates and offers the
terms. The second is when the old and the
substitution of a new debtor.
new obligations are incompatible on every
• The creditor accepts.
point.
• The test of incompatibility is whether or not the • A third person consents to the substitution
two obligations can stand together, each one and assumes the obligation.
having its independent existence. If they • Insolvency of the new debtor in
cannot, they are incompatible and the latter delegacion:
obligation novates the first. Corollarily, • The insolvency of the new debtor, who has
changes that breed incompatibility must be been proposed by the original debtor and
essential in nature and not merely accidental. accepted by the creditor, shall not revive
• The incompatibility must take place in any of the action of the latter against the original
the essential elements of the obligation, such obligor, except when said insolvency was
as its object, cause or principal conditions already existing and of public knowledge,
thereof; otherwise, the change would be or known to the debtor, when he delegated
merely modificatory in nature and insufficient his debt. (Article 1295 NCC)
to extinguish the original obligation.
Right of New Debtor Who Pays c. Creditor has right to refuse payment by
• In expromision, payment by the new debtor third person without interest in obligation.
gives him the right to beneficial • It is also consistent with the rule that a
reimbursement under the second paragraph creditor cannot be compelled to accept
of Article 1236. payment or performance by a third person
• If the payment was made with the consent of who has no interest in the fulfillment of the
the original debtor or on his own initiative obligation. [Article 1236, par. 2]
(delegacion), the new debtor is entitled to • The creditor, however, may accept, if he so
reimbursement and subrogation under Article wishes, payment from a third party. But mere
1237. acceptance of payments for the benefit of a
debtor, whose obligation the third party has
BAR QUESTION (1975)
assumed, in the absence of facts
A borrowed from B the sum of P3, 000.00. Three unmistakably showing an intention to make
days after, A in a letter authorized the Philippine the third party alone liable, does not constitute
National Bank to pay his debt to B out of whatever a novation consisting in the substitution of a
crop loan might be granted to him by said Bank. On new debtor in lieu of the old one.
the same day, the Bank agreed but the Bank paid B
only P2, 000.00. On the date of maturity, B sued the
Bank and A for the remaining P1, 000.00. Is the (2) Effect of Insolvency Of New Debtor
Bank liable to B? General Rule: Insolvency of the new debtor,
who has been proposed by the original debtor
SUGGESTED ANSWER and accepted by the creditor, shall not revive the
The Bank is not liable to B for the remaining action of the latter against the original obligor.
P1,000.00. Even assuming that B gave his consent [Article 1295]
to A’s proposal that the Bank shall pay his XPN: Original debtor shall be held liable when
indebtedness of P3,000.00, in reality, there was no insolvency was already existing and of public
substitution of debtor by delegacion within the knowledge, or known to the original debtor at the
meaning of Arts. 1291, No. 2, and 1293 of the Civil time of substitution. [Article 1295]
Code resulting in a novation of the obligation. The
Bank never assumed payment of the obligation.
There was merely an authorization, which was d) LEGAL AND CONVENTIONAL
accepted by the Bank, that the latter shall pay A’s SUBROGATION
debt out of whatever crop loan would be granted to ‘Novation by Subrogation’ defined
him by the Bank. As it turned out, the Bank agreed • It is the transfer of all rights of the creditor to a
to lend A only P2, 000.00, and said amount was third person, who substitutes him in all his
paid directly to B in accordance with the Bank’s rights.
promise. Beyond that amount, the Bank cannot be • When a third person is subrogated to the
held liable. (Hodges vs. Rey, 111 Phil. 219.
rights of the other creditors, the creditor
(1) Consent Required effecting the novation is liable for their share
Consent of Creditor Necessary to in the credit. But if the creditor subrogates a
Substitution. third person in his place, such amounts to an
In both the two modes of substitution, the assignment of his rights which he cannot do
consent of the creditor is an indispensable without the consent of other creditors.
requirement.
Legal Subrogation — Takes place without
a. Substitution implies waiver by creditor of agreement but by operation of law as a result of
his credit. certain acts performed by the parties.
• Since novation of a contract by substitution of Conventional Subrogation — that which takes
a new debtor extinguishes the personality of place by agreement of the parties.
the first debtor, it implies on the part of the
creditor a waiver of the right he had before Legal Subrogation is Presumed
the novation. a. When a creditor pays another creditor who
• Hence, the creditor’s consent is necessary to is preferred, even without the debtor’s
the substitution of a new debtor. knowledge;
b. When a third person, not interested in the
b. Substitution may be prejudicial to the obligation, pays with the express or tacit
creditor. approval of the debtor;
The requirement is based on simple c. When even without the knowledge of the
consideration of justice since the consequence debtor, a person interested in the fulfillment
of the substitution may be prejudicial to the of the obligation pays, without prejudice to
creditor and such prejudice may take the form of the effects of confusion as to the latter’s
delay in the fulfillment of the obligation, or share. [Article 1302]
contravention of its tenor, or non-performance
thereof by the new debtor, by reason of his
financial inability or insolvency.
II. CONTRACTS
A. General Provisions C. Essential Requisites of a Contract
B. Basic Principles of Contracts D. Defective Contracts
A. GENERAL PROVISIONS • In real contracts, it is perfected upon

delivery of thing which is the object thereof.
• In solemn contracts, required formality is an
1. DEFINITION OF A CONTRACT
essential element for validity, hence, the
‘Contract’ defined
• A contract is a meeting of minds between two
same must be observed.
persons whereby one binds himself, with • Acceptance of the offer must be absolute.
respect to the other, to give something or to • A qualified acceptance constitutes a
render some service. [Article 1305] counter-offer, and has the effect of rejecting
• One or more persons bind himself or the offer.
themselves with respect to another or others, • Acceptance may be express of implied.
or reciprocally, to the fulfillment of a prestation • If the offer fixes the time, place and manner
to give, to do, or not to do. of acceptance, all such conditions must be
complied with.
Stages of Contracts • An offer made through an agent is accepted
1. Negotiation from the time acceptance is communicated
2. Perfection to him.
3. Consummation • An offer becomes ineffective upon the
death, civil interdiction, insanity, or
1. Negotiation insolvency of either party before
• Covers the period from the time the acceptance is conveyed.
prospective contracting parties indicate
interest in the contract to the time the contract 3. Consummation
is concluded (perfected). Stage of consummation of contract begins
• Initiated by an offer
when the parties perform their respective
• Public advertisements or solicitacions and the
commitments under the contract culminating
like are generally construed as mere
in the death of extinguishment of the contract.
invitations to make offers or proposals.
• At any time prior to perfection of the contract,
either negotiating party may stop the Classification of Contracts
negotiation. A. According to perfection
1. Consensual – perfected by mere
Rules when period is given to the offeree to consent, such as sale and barter.
accept the offer 2. Real – perfected by the delivery of the
• If the period is not itself founded upon or object of the contract, such as pledge,
supported by a consideration, the offeror is loan and deposit.
still free and has the right to withdraw the
offer before its acceptance, by communicating B. According to degree of importance
the withdrawal to the offeree. 1. Principal - can stand alone, such as
• If period has a separate consideration, a sale, barter, deposit and loan.
contract of “option” is deemed perfected, and 2. Accessory – its existence and validity is
it would be a breach of that contract to dependent upon another contract, such
withdraw the offer during the agreed period. as pledge , mortgage and guaranty.
• The OPTION should be distinguished from
the main contract which is yet to be C. According to name
concluded. 1. Nominate - with a special name, such as
• If the optioner withdraws the offer before its pledge, barter and lease.
acceptance by the optionee, the latter may
2. Innominate - without any name.
not sue for specific performance since the
main contract has failed from being perfected.
D. According to cause
The optioner-offeror however renders himself
liable for breach of option.
1. Onerous - there is an exchange of
consideration, such sale, barter and
2. Perfection lease.
• The contract is perfected (birth of contract) in 2. Gratuitous - there is no consideration,
consensual contracts at the moment there is received in exchange for what has been
meeting of minds upon the object and the given, such as donation, remission and
cause thereof. commodatum.
2. ELEMENTS OF A CONTRACT stipulations, but also the consequences which,

a) Essential elements according to their nature, may be in keeping with
• Essential – those without which there can be good faith, usage, and law.
no contract (Art. 1318)
• Common elements – present in all contracts 2. FREEDOM TO STIPULATE
• Consent (AUTONOMY OF THE WILL) AND ITS
• Object or subject matter LIMITATIONS
• Cause or consideration Principle of Autonomy of Contracts [Article
• Special elements – only in certain contracts 1306]
(delivery in real contracts, form in solemn • Contracting parties may establish such
ones) stipulations, clauses, terms, conditions as they
• Extraordinary elements – peculiar to specific may deem convenient, provided they are not
contract (price in a contact of sale) contrary to law, morals, good customs, public
order or public policy. [Article 1306]
b) Natural Elements • 2 aspects: (1) freedom to decide whether or
those which are derived from the nature of the not one should enter into contractual
contract and ordinarily accompany the same; relationship at all; (2) freedom to stipulate
they are presumed by law (i.e warranty against upon whatever terms the parties wish and
eviction in sale, although the contracting parties agree.
may increase, diminish or even suppress it.)
Exceptions on freedom to contract or not to
contract:
B. BASIC PRINCIPLES OF • Art 448 accession
CONTRACTS • Eminent domain
1. OBLIGATORY FORCE OF A Limitation on freedom to stipulate on specific

CONTRACT terms:
Principle of Obligatory Force Stipulations should not be contrary to law,
Articles 1159 & 1315 of the Civil Code morals, good customs, public order, or public
• Article 1159. Obligations arising from policy.
contracts have the force of law between the
contracting parties and should be complied The following agreements have been held to
with in good faith. contravene the principle of autonomy of
• Article 1315. Contracts are perfected by contracts:
mere consent, and from that moment the • Sale of land covered by a homestead patent
parties are bound not only to the fulfillment of within the 5-year prohibitory period, as being
what has been expressly stipulated but also contrary to law.
to all the consequences which, according to • A promise of marriage where carnal
their nature, may be in keeping with good knowledge is the consideration of the promise
faith, usage and law. as being contrary to morals.
• A contract, once perfected, has the force • Employment contract providing that within 5
of law between the parties, with which years from termination, the employee cannot
they are bound to comply in good faith, work with another company without the written
and neither one may, without consent of permission of the employer as being an
the other, renege therefrom. unreasonable restraint and contrary to public
• Contracts are the law and, as a result, policy
courts must enforce them between the • Waiver of right to transfer to another school in
contracting parties. a scholarship grant as being contrary to public
• Courts cannot make a contract or a order and public policy.
stipulation if there is none.
3. BINDING EFFECT OF A CONTRACT
IP E-GAME VENTURES, INC. V TAN Mutuality (Art. 1308)
G.R. NO. 239576, JUNE 30, 2021 Article 1308. The contract must bind both
Ruling: contracting parties; its validity or compliance
It is well-established that a contract is the law cannot be left to the will of one of them.
between the parties. Obligations arising from • Principle flows from legal tie (vinculum juris)
contracts have the force of law between the • Reason why a suspensive condition whose
contracting parties and should be complied with fulfillment depends solely on the will of the
in good faith. "Unless the stipulations in a debtor is void (Article 1182)
contract are contrary to law, morals, good • Validity or fulfillment may be left to (1) the will
customs, public order, or public policy, the same of a third person, whose decision shall not be
are binding as between the parties." From the binding until made known to both the
contracting parties (Art. 1309) or (2) chance.
moment the contract is perfected, the parties are
bound not only to the fulfillment of its
• Determination of third person shall not be

binding until it has been made known to the By virtue of such proviso, over the objections of
parties. Samuel, the bank increased the interest rate
• It shall not be obligatory if it is evidently periodically until it reached 48% per annum.
inequitable – the courts may decide what is Finally, Samuel filed an action questioning the
equitable under the circumstances. right of the bank to increase the interest rate up
Example: Loan contract provides that lender to 48%. The bank raised the defense that the
can increase or decrease the interest every Central Bank of the Philippines had already
year as it may deem necessary. suspended the Usury Law. Will the action
• Escalation clauses are not invalid per se for as prosper or not? Why?
long as they are not solely potestative but SUGGESTED ANSWER
based on reasonable and valid standards.
Yes, the action will prosper rendering such
Article 1308 of the Civil Code expresses what is escalation clause void. The Civil code provides
known in law as the principle of mutuality of for the principle of mutuality of contracts, which
contracts. It provides that "the contract must bind states that a contract cannot be left to the will of
both the contracting parties; its validity or one of the parties. An escalation clause is a
compliance cannot be left to the will of one of stipulation in a contract that allows for an
them." This binding effect of a contract on both increase or decrease in price or wage. In a
parties is based on the principle that the similar case decided by the Supreme Court, it
obligations arising from the contracts have the was ruled that a party cannot unilaterally
force of law between the contracting parties, and increase the rate of interest, and that an
there must be mutuality between them based increase of interest of 18% to 68% is
essentially on their equality under which it is considered as unconscionable. [Sps. Almeda V
repugnant to have one party bound by the CA 326 Phil. 309 (1996)] In this case, while the
contract while leaving the other free therefrom. interest ceiling by the Usury Law is no longer in
The ultimate purpose is to render void a contract force, such drastic unilateral increase of
containing a condition which makes its fulfillment interest would go against the mutuality of
dependent solely upon the uncontrolled will of contracts thus, rendering the interest void.
one of the contracting parties. (Allied Banking
Corp. v. CA, G.R. No. 124290, January 16, 1998) Contract of Adhesion
A contract of adhesion is one wherein one party
BAR QUESTION (2016)
imposes a ready-made form of contract on the
B Bank, a large universal bank, regularly extends other in which almost all of the provisions are
revolving credit lines to business establishments drafted by one party, thereby reducing the
under what it terms as socially responsible participation of the other to affixing its signature
banking and private business partnership or to adhering to the contract. However, the
relations. All loans that are extended to clients contract of adhesion is not invalid per se but is
have a common "Escalation Clause”, to wit: “B as binding as any other contract. The Court only
Bank hereby reserves its right to make struck down contracts of adhesion as void when
successive increases in interest rates in the weaker party has been imposed upon in
accordance with the bank’s adopted policies as dealing with the dominant bargaining party as to
approved by the Monetary Board; Provided that
be reduced to the alternative of taking it or
each successive increase shall be with the
leaving it, being completely deprived of the
written assent of the depositor.”
opportunity to bargain on equal footing. (Villa
X, a regular client of the bank, contends that the
"Escalation Clause" is unfair, unconscionable and
Crista Monte Realty & Development Corporation
contrary to law, morals, public policy and Vs. Equitable Pci, And The Ex-officio Sheriff Of
customs. Rule on the issue and explain. Quezon City And/Or His Deputy Or Authorized
Representatives G.R. No. 208336, November
SUGGESTED ANSWER 21, 2018)
The ”escalation clause” is valid because each BAR QUESTION (2018)
successive increase shall be with the written
assent of the depositor. This stipulation does not Newlyweds Sam and Sienna had contracted
violate the principle of mutuality of contracts and with Sangria Hotel for their wedding reception.
it would only have been void if the supposed The couple was so unhappy with the service,
consent is given prior to the increase in interest claiming, among other things, that there was an
rate.. unreasonable delay in the service of dinner and
that certain items promised were unavailable.
BAR QUESTION (2001) The hotel claims that, while there was a delay
in the service of the meals, the same was
Samuel borrowed P300,000.00 housing loan
occasioned by the sudden increase of guests
from the bank at 18% per annum interest.
to 450 from the guaranteed expected number
However, the promissory note contained a
proviso that the bank "reserves the right to of 350, as stated in the Banquet and Meeting
increase interest within the limits allowed by law." Services Contract.
ASIAN TERMINAL, INC. VS. PADOSON

In the action for damages for breach of contract
instituted by the couple, they claimed that the
STAINLESS STEEL CORPORATION
Banquet and Meeting Services Contract was a G.R. NO. 211876, JUNE 25, 2018
contract of adhesion since they only provided The basic principle of relativity of contracts is
the number of guests and chose the menu. On that contracts can only bind the parties who
the other hand, the hotel's defense was that the entered into it, and cannot favor or prejudice a
proximate cause of the complainant's injury was third person, even if he is aware of such contract
the unexpected increase in their guests, and this and has acted with knowledge thereof.
was what set the chain of events that resulted in Indeed, "where there is no privity of contract,
the alleged inconveniences. there is likewise no obligation or liability to speak
Was the Banquet and Meeting Services about."
Contract a contract of adhesion? If yes, is
the contract void? b) EXCEPTIONS TO THE RULE ON
PRIVITY OF CONTRACTS
SUGGESTED ANSWER
Yes, it is a contract of adhesion. It is one Exceptions to the rule of relativity:
wherein one party imposes a ready-made form 1) Beneficial stipulation/stipulation pour autrui –
of contract on the other in which almost all of the A beneficial stipulation in favour of a third
provisions are drafted by one party, thereby person.
reducing the participation of the other to affixing 2) When the third person comes into
its signature or to adhering to the contract. possession of the object of a contract
No, a contract of adhesion is not invalid per se creating real rights; (Art. 1312)
as they are binding as ordinary contracts. While 3) Where the contract is entered into in order to
the Court has occasionally struck down defraud a creditor; (Art. 1313) Here, the
contracts of adhesion as void, it did so only creditor may ask for its rescission.
when the weaker party has been imposed upon 4) Where the third person induces a contracting
in dealing with the dominant bargaining party party to violate his contract (Art. 1314). Such
and reduced to the alternative of taking it or third person can be held liable for damages.
leaving it, completely deprived of the opportunity 5) Accion Directa – Art 1652 when lessor may
to bargain on equal footing. There is no sue sub-lessee for rent due from lessee
showing in the given facts that the couple had
been deprived of opportunity to bargain on Requisites in Stipulation Pour Autrui:
equal footing with the hotel (1) there is a stipulation in favor of a third
person;
4. PRIVITY OF CONTRACT (2) the stipulation is a part, not the whole, of the
contract;
a) CONCEPT
(3) the contracting parties clearly and
Principle of Relativity of Contracts (Art. 1311) deliberately conferred a favor to the third
General Rule: Contracts take effect only person — the favor is not an incidental
between parties, their assigns and heirs. benefit;
• Transmissible/ transferrable (4) the favor is unconditional and
uncompensated;
(5) the third person communicated his or her
acceptance of the favor before its revocation;
and
(6) the contracting parties do not represent, or
are not authorized by, the third party.
BAR QUESTION (1980)
O, a very popular movie star, was under
contract with P Movie Productions to star
Note: When rights under a contract are exclusively in the latter’s films for two years. O
assignable and assigned as such, the was prohibited by the contract to star in any
assignee may be harmed or affected. The film produced by another producer. X Film Co.
same goes for heirs of a contracting party who induced O to break her contract with P Movie
has died. Productions by giving her twice her salary. P
Movie Productions sued X Film Co. for
Exception to rule of transferability of damages. X Film Co. contended that it had a
obligations to heirs and assigns right to compete for the services of O and that
Not transmissible by: her contract with P Movie Productions was in
1. law, restraint of trade and a restriction on her
2. by stipulation, freedom of contract. Whose contention would
3. or by nature (purely personal). you sustain?.
The contention of P Movie Productions Roland is bound by the contract he entered

should be sustained. According to the Civil into with Lady Love and he cannot
Code, any third person who induces disregard the same, under the principle of
another to violate his contract shall be obligatoriness of contracts. Obligations
liable for damages to the other contracting arising from contracts have the force of law
party. In the law of torts, we call this between the parties.
“interference with contractual relation.’’
However, in order that it will be actionable, Yes, Roland is liable under the contract as
it is necessary that the following requisites far as Lady Love is concerned. He is liable
must concur: (a) the existence of a valid for damages under Article 1170 of the Civil
contract; (b) knowledge on the part of the Code since he contravened the tenor of his
third person of the existence of such obligation. Not being a contracting party,
contract; and (c) interference by the third Sweet Taste is not bound by the contract
person without legal justification or excuse. but It can be held liable under Art. 1314.
All of these requisites are present in the The basis of its liability Is not prescribed by
contract but is founded on quasi-delict,
case at bar
assuming that Sweet Taste knew of the
BAR QUESTION (1991) contract. Article 1314 of the Civil Code
provides that any third person who induces
Roland, a basketball star, was under contract another to violate his contract shall be liable
for one year to play-for-play exclusively for
for damages to the other contracting party.
Lady Love, Inc. However, even before the
basketball season could open, he was offered
a more attractive pay plus fringes benefits by BAR QUESTION (2002)
Sweet Taste, Inc. Roland accepted the offer Printado is engaged in the printing business.
and transferred to Sweet Taste. Lady Love Suplico supplies printing paper to Printado
sues Roland and Sweet Taste for breach of pursuant to an order agreement under which
contract. Defendants claim that the restriction Suplico binds himself to deliver the same
to play for Lady Love alone is void, hence, volume of paper every month for a period of
unenforceable, as it constitutes an undue 18 months, with Printado in turn agreeing to
interference with the right of Roland to enter pay within 60 days after each delivery. Suplico
into contracts and the impairment of his has been faithfully delivering under the order
freedom to play and enjoy basketball. agreement for 10 months but thereafter
Can Roland be bound by the contract he
stopped doing so, because Printado has not
entered Into with Lady Love or can he
made any payment at all.
disregard the same? Is he liable at all? How
about Sweet Taste? Is it liable to Lady
Printado has also a standing contract with
Love?
publisher Publico for a printing of 10,000
SUGGESTED ANSWER volumes of school textbooks. Suplico was
aware of said printing contract. After printing
Roland is bound by the contract he entered into
1,000 volumes, Printado fails to perform under
with Lady Love and he cannot disregard the
its printing contract with Publico. Suplico sues
same, under the principle of obligatoriness of
Printado for the value of unpaid deliveries
contracts. Obligations arising from contracts
have the force of law between the parties.
under their order agreement. At the same
time, Publico sues Printado for damages for
Yes, Roland is liable under the contract as far breach of contract with respect to their own
as Lady Love is concerned. He is liable for printing agreement.
damages under Article 1170 of the Civil Code
since he contravened the tenor of his In the suit filed by Suplico, Printado counters
obligation. Not being a contracting party, Sweet that: A) Suplico cannot demand payment for
Taste is not bound by the contract but It can be deliveries made under their order agreement
held liable under Art. 1314. The basis of its until Suplico has completed performance
liability Is not prescribed by contract but is under said contract; B) Suplico should pay
founded on quasi-delict, assuming that Sweet damages for breach of contract; and C)
Taste knew of the contract. Article 1314 of the Sulpico should be liable for Printado’s breach
Civil Code provides that any third person who of his contract with Publico because the order
induces another to violate his contract shall be agreement between Suplico and Printado was
liable for damages to the other contracting for the benefit of Publico.
party. Are the contentions of Printado tenable?
SUGGESTED ANSWER b) EXCEPTIONS

1. Real Contracts
No, the contentions of Printado are Example: Deposit, Commodatum
untenable. Printado having failed to pay for 2. Formal Contracts
the printing papers covered by the delivery 3. Contracts covered under the Statute of
invoices on time, Suplico has the right to Frauds.
cease making further delivery. It is clear
that Suplico did not violate the order c) REFORMATION OF INSTRUMENTS
agreement (Integrated Packaging • Article 1359. When, there having been a
Corporation v. Court of Appeals, (333 meeting of the minds of the parties to a
SCRA 170, F.R. No. 115117, June 8, 2000). contract, their true intention is not
Suplico cannot be held liable for damages, expressed in the instrument purporting to
for breach of contract, as it was not he who embody the agreement, by reason of
violated the order agreement, but Printado. mistake, fraud, inequitable conduct or
accident, one of the parties may ask for
Suplico cannot be held liable for Printado’s the reformation of the instrument to the
breach of contract with Publico. He is not end that such true intention may be
party to the agreement entered into by and expressed.
between Printado and Publico. Theirs is not • If mistake, fraud, inequitable conduct, or
a stipulation pour autrui. Such contracts do accident has prevented a meeting of the
not affect third persons like Suplico minds of the parties, the proper remedy is
because of the basic civil law principle of not reformation of the instrument but
relativity of contracts which provides that annulment of the contract.
contracts can only bind the parties who • Remedy by means of which a written
entered it, and it cannot favor or prejudice a instrument is reformed so as to express or
third person, even if he is aware of such conform to the real intention of the parties
contract and has acted with the knowledge when some error or mistake has been
thereof. committed.
5. CONSENSUALITY OF CONTRACTS Requisites of Reformation of Instruments

1. Meeting of the minds of the parties;
a) CONCEPT AND COVERAGE 2. Their true intention is not expressed in
General Rule: Contracts are perfected by the instrument;
the meeting of the minds of the contracting 3. Failure to express true intention is due
parties. They are obligatory in any form (oral to mistake, fraud, inequitable conduct
or written) as long as parties have agreed to or accident; and
undertake their obligations under the 4. Clear and convincing proof of mistake,
contract. It is indispensable in any contract accident, relative simulation, fraud, or
that the parties thereto give their consent inequitable conduct.
Article 1305. A contract is a meeting of REFORMATION V. ANNULMENT

minds between two persons whereby one REFORMATION ANNULMENT
binds himself, with respect to the other, to
give something or to render some service. Presupposes that The contract was
there is a valid not validly entered
Article 1315. Contracts are perfected by contract but the into as when their
mere consent, and from that moment the document/instrume minds did not meet
parties are bound not only to the fulfillment nt executed does or if the consent
of what has been expressly stipulated but not express their was vitiated
also to all the consequences which, true intention
according to their nature, may be in keeping Gives life to the Involves a complete
with good faith, usage and law. contract by making nullification of the
the instrument contract
Article 1316. Real contracts, such as conform to the true
deposit, pledge and commodatum, are not intention of the
perfected until the delivery of the object of parties
the obligation.
When Parties May Ask For Reformation Lydia convinced Ulysses to buy an additional
a. When there has been meeting of the minds of 400-square meter portion of Lot No. 199 that
the parties to a contract; is adjacent to the flat terrain for P160,000.00
b. When their true intention is not expressed in on installment basis. Ulysses agreed on the
the instrument purporting to embody the condition that Lydia will amend the deed of
agreement; sale reflecting the correct location, area and
c. When by reason of fraud, mistake, inequitable consideration.
conduct or accident. • On October 19, 1992, the parties entered into
a contract to sell over the 400-square meter
Rule In Case Mistake lot. Ulysses gave initial payment and Lydia
a. Must be mutual and refer not to the issued the corresponding receipt. Meantime,
agreement itself but to the manner the true Ulysses began constructing the resort and
agreement is reflected or expressed in the paid the remaining amount. In 1997, Ulysses
instrument. (1361) asked Lydia to prepare the amended deed of
b. May be ordered at the instance of either sale but she refused because he still has an
parties or his successors in interest, unpaid balance of P12,000.00. Yet, Ulysses
otherwise it may only be brought by the maintained that he already paid Lydia more
petition of the injured party or his heirs and than P160,000.00.
assigns. [1368] Issue:
WoN the Deed of Absolute Sale between Lydia
Instances When There Can Be No and Ulysses failed to reflect the true intention of
Reformation: the parties allowing reformation of the
• Simple donations inter vivos wherein no instrument.
condition is imposed; Ruling:
• Wills; • All the requisites for an action for reformation
• When the real agreement is void. [Article of instruments to prosper are present.
1366] • First, there was a meeting of minds between
the contracting parties. In executing the Deed
Other Instances When Reformation Is Not of Absolute Sale dated February 8, 1992,
The Remedy Lydia conveyed the 800-sq m portion of Lot
• If mistake, fraud, inequitable conduct or No. 199 to Ulysses who accepted it in
accident has prevented a meeting of the consideration of P350,000.00.
minds of the parties, the proper remedy is the • Second, the written instrument did not
annulment of the contract. [Article 1359] express the true intention of the parties. It
• When one of the parties brought an action to bears emphasis that Ulysses bought an area
enforce the instrument [Article 1367] - no suitable for building a beach resort. Upon
subsequent reformation can be asked by him payment of the purchase price, Ulysses
based on the Principle of Estoppel. occupied the flat terrain, surveyed it and
began constructing the resort. Verily, Ulysses
RUDI V STAGER would not possess the flat terrain if it was not
G.R. NO. 232825, SEPTEMBER 16, 2020 the lot sold to him. Besides, the flat terrain is
Facts: a proper location for building the resort and
• Lydia Stager owns a 6,100-square meter (sq not the elevated rocky northern part. At any
m) real property identified as Lot No. 199 and rate, Lydia should have objected when
situated in Barangay Manoc-Manoc, Boracay Ulysses occupied the flat terrain if it were true
Island. The land adjoins the sea on its that she was still the owner of such area.
eastern part and is generally flat at the center • Quite the contrary, Lydia promised to rectify
but has an elevated rocky northern part. In the erroneous description of the lot in the
1991, Lydia offered to sell the entire lot to deed of sale. She did not protest the
Ulysses Rudi Banico but he only agreed to construction of the resort and instead, offered
buy an area suitable for building a beach Ulysses an additional 400-sq m portion of Lot
resort. Accordingly, Ulysses' lawyer drafted a No. 199 that is adjacent to the flat terrain.
Deed of Absolute Sale over the 800-sq m Moreover, Lydia acknowledged the
portion of the land for P350,000.00. On transaction over the 800-sq m lot before the
February 8, 1992, Lydia and Ulysses signed barangay and presented a notarized Deed of
the contract. Absolute Sale dated December 6, 2001,
• Upon payment of the purchase price, Ulysses containing the accurate description of the flat
took possession of the flat terrain and hired a terrain. At this juncture, we stress that Lydia
surveyor. However, Ulysses discovered that never rebutted these acts and even admitted
the land described in the deed of sale refers them in her answer.
to the elevated and rocky portion and not the • Third, there is a mistake in identifying the
flat area which he bought and occupied. exact location of the lot which caused the
Ulysses confronted Lydia who promised to failure of the instrument to disclose the
make necessary corrections. At that time, parties' real agreement.
• In Quiros v. Arjona, this Court held that the ‘Acceptance’ defined

inability to identify the exact location of the It is the manifestation by the offeree of his
inherited property did not negate the principal assent to the terms of the offer. Without
object of the contract. This is an error acceptance, there can be no meeting of the
occasioned by the failure of the parties to minds between the parties. [Article 1305]
describe the subject property, which is A mere offer produces no obligation.
correctible by reformation and does not
indicate the absence of the principal object as Acceptance of Offer Must be Absolute
to render the contract void. In that case, the The acceptance of an offer must be absolute,
object is determinable as to its kind and can unconditional or unqualified, that is, it must be
be determined without need of a new identical in all respects with that of the offer so
contract. as to produce the consent or meeting of the
minds necessary to perfect a contract.
C. ESSENTIAL REQUISITES OF Qualified Acceptance

A CONTRACT • Merely constitutes a counter-offer or a new
proposal which, in law, is considered a
Article 1318. There is no contract unless the rejection of the original offer and an attempt
following requisites concur: by the parties to enter into a contract on a
(1) Consent of the contracting parties; different ba sis.
(2) Object certain which is the subject matter • A qualified acceptance must, in turn, be
of the contract; accepted absolutely in order that there will be
(3) Cause of the obligation which is a contract.
established.
Acceptance Made By Letter Or Telegram
1. CONSENT General Rule: Acceptance made by letter or
‘Consent’ defined telegram does not bind the offeror.
It is the conformity of wills and with respect to XPN: Except from the time it came to his
contracts, it is the agreement of the will of one knowledge. The contract, in such a case, is
contracting party with that of another or others, presumed to have been entered into in the place
upon the object and terms of the contract. where the offer was made.
Consent is manifested by: Form of acceptance of offer

The meeting of the offer and the acceptance An acceptance may be:
upon the thing and the cause which are to 1. Express - may be oral or written;
2. Implied - one that is inferred from act or
constitute the contract. [Article 1319]
conduct. [Article 1320]
Requisites
Acceptance By Silence or Inaction.
1. Must be manifested by the concurrence
General Rule: Silence cannot be construed as
of the offer and acceptance; [Articles acceptance. The acceptance must be
1319-1326] affirmatively and clearly made and evidenced by
2. Parties must possess the necessary legal words or some acts or conduct communicated to
capacity; [Articles 1327-1329] and the offeror.
3. Must be intelligent, free, spontaneous, XPN:
and real. [Articles 1330-1346] (a) where the parties agree expressly or
impliedly, that it shall amount to acceptance;
‘Offer’ defined (b) where specific provisions of law so declare;
It is a proposal made by one party (offerer) to and
another to enter into a contract. It is more than (c) where under the circumstances such silence
an expression of desire or hope. It is really a constitutes estoppel. [Article 1431]
promise to act or to refrain from acting on
condition that the terms thereof are accepted Matters That May Be Fixed By The Offeror
by the person (offeree) to whom it is made. • Time
• When the offeror has not fixed a period for the
Offer Must Be Certain offeree to accept the offer, and the offer is
The offer must be certain or definite and clear, made to a person present, the acceptance
and not vague or speculative so that the must be made immediately; hence, the
liability (or the rights) of the parties may be offeree cannot complain that he was not given
exactly fixed because it is necessary that the a reasonable period within which to accept or
acceptance be identical with the offer to create reject the offer of the offeror.
a contract without any further act on the part of • Place
the offeror. • Manner of acceptance [Article 1321]
General Rule: All matters fixed must be The following cannot give consent to a contract:
complied with otherwise the offer shall be 1) Unemancipated minors
deemed terminated. • They refer to those persons who have
XPN: An acceptance departing from the terms of not yet reached the age of majority (18
the offer constitutes a counter-offer. years) and are still subject to parental
authority.
Offer Made Through An Agent 2) Insane or demented persons, and
• It is accepted from the time acceptance is • Insane during lucid interval – valid
communicated to him. [Article 1322] • Under state of drunkenness or hypnotic
spell – voidable (1328)
General Rule: Article 1322 applies only if the 3) Deaf-mutes who do not know how to
offer is made through the agent and the write.
acceptance is communicated through him. • They are persons who are deaf and
dumb.
When Offer Becomes Ineffective • Deaf-mutes who do not know how to
a. Upon the death of either party before
write cannot give consent to a contract;
acceptance is conveyed;
If the deaf-mute knows how to write,
b. Civil interdiction of either party before
the contract is valid for then he is
acceptance is conveyed;
capable of giving intelligent consent.
c. Insanity, of either party before acceptance
is conveyed; or
d. Insolvency of either party before
Rule When Incapable Parties Enter Into a
acceptance is conveyed. Contract
1) If one of the parties is incapable of giving
Business Advertisements Of Things For Sale consent: Voidable.
• Business advertisements of things for sale 2) If both parties are incapable of giving
are not definite offers, acceptance of which consent: Unenforceable unless ratified.
will not perfect a contract but are merely
invitations to the reader to make an offer or Vices of Consent
only as proposals. (1325) a. Violence
• Advertisement for bidders is mere invitation to b. Intimidation
submit proposals. Advertiser is not bound to c. Mistake
accept the highest or lowest bidder unless the d. Fraud
contrary appears. (1326) e. Undue Influence [Article 1330]
BAR QUESTION (1991) FRAUD

"K" & Co. published in the newspaper an • There is fraud when, through insidious words
"Invitation To Bid" inviting proposals to supply or machinations of one of the contracting
labor and materials for a construction project parties, the other is induced to enter into a
described in the invitation. "L", "M", and "N" contract which, without them, he would not
submitted bids. When the bids were opened, it have agreed to. (1338)
appeared that "L" submitted the lowest bid. • It must have been serious;
However, "K" & Co. awarded the contract "N", • It induced the other party to enter into a
the highest bidder, on the ground that he was contract;
the most experienced and responsible bidder. • It must be made in bad faith, i.e. with
"L" brought an action against "K" & Co, to knowledge of its falsify
compel the award to him and to recover • Should not have been employed by both
damages. Is "L's" position meritorious? contracting parties (1344)
SUGGESTED ANSWER Article 1339. Failure to disclose facts, when

"L's” position is not meritorious. According to there is a duty to reveal them, as when the
the Civil Code, advertisements for bidders are parties are bound by confidential relations,
simply invitations to make proposals, and the constitutes fraud.
advertiser is not bound to accept the highest
or lowest bidder, unless the contrary appears Article 1340. The usual exaggerations in trade,
(Art. 1326). It is clear that the general rule when the other party had an opportunity to
applies in the instant case. In its know the facts, are not in themselves
advertisements, "K" & Co., for instance, did fraudulent.
not state that it will award the contract to the
lowest bidder. Therefore, in awarding the Article 1341. A mere expression of an opinion
contract to “N", the defendant company acted does not signify fraud, unless made by an
in accordance with its rights. expert and the other party has relied on the
former's special knowledge.
Article 1342. Misrepresentation by a third Issue/s:

person does not vitiate consent, unless such • WoN the subject contract is valid in view of the
misrepresentation has created substantial spouses Genotiva's claim of vitiated consent;
mistake and the same is mutual. and
• WoN BDO has the right to retain the
Article 1343. Misrepresentation made in good P500,000.00 under the Deed of Suretyship.
faith is not fraudulent but may constitute error. Ruling:
The Subject Contract is valid:
‘Mistake’ defined
• Refer to substance of the thing which is the For intimidation to vitiate consent, the following
object of the contract or to those conditions requisites must be present:
that principally moved one or both parties to (1) that the intimidation must be the determining
enter into contract. cause of the contract, or must have caused the
• Mistake as to identity or qualifications will consent to be given; (2) that the threatened act
vitiate consent only when such have been the be unjust or unlawful; (3) that the threat be real
principal cause of the contract and serious, there being an evident disproportion
• Simple mistake if account shall give rise to between the evil and the resistance which all men
correction (1331) can offer, leading to the choice of the contract as
• There is no mistake if the party knew the the lesser evil; and (4) that it produces
doubt, contingency or risk affecting the object reasonable and well-grounded fear from the fact
of the contract (1333) that the person from whom it comes has the
• Mutual error as to legal effect of the necessary means or ability to inflict the
threatened injury.
agreement when the real purpose of the
parties is frustrated may vitiate consent.
Applying the foregoing to this case, it is obvious
(1334)
that BDO's supposed "threat", i.e., its withholding
of Violet's retirement benefits, is not the
BURDEN OF PROOF
intimidation referred to by law. The records show
Article 1332. When one of the parties is unable
that the bank was unable to release Violet's
to read, or if the contract is in a language not
clearance for the release of her retirement
understood by him, and mistake or fraud is
benefits for the simple reason that she had an
alleged, the person enforcing the contract must
existing liability to the bank arising from the Deed
show that the terms thereof have been fully of Suretyship that she executed with her husband
explained to the former. and other stockholders of Goldland. Clearly, such
act is neither unjust nor unlawful.
SPOUSES GENOTIVA v. EQUITABLE-PCI
BANK, G.R. No. 213796, June 28, 2021 It is important to differentiate consent that is
J. Hernando reluctantly but freely given, on one hand from
Facts: consent that was obtained through duress or any
On February 13, 2003, the spouses Genotiva other vice of consent, on the other. Contracts
filed a Complaint against BDO, seeking entered into with reluctance are not necessarily
nullification of a contract, reconveyance, voidable. We explained in Martinez v. Hongkong
damages, and preliminary injunction. The & Shanghai Banking Corp. that:
complaint alleged that BDO granted a loan to
Goldland Equity, Inc., a company owned by It is necessary to distinguish between real duress
Calvin Genotiva and his business colleagues, and the motive which is present when one gives
with the Genotivas acting as sureties. When his consent reluctantly. A contract is valid even
Violet Genotiva retired, she requested her though one of the parties entered into it against
retirement benefits and the release of a property his wishes and desires or even against his better
title held by BDO, but the bank refused unless a judgment. Contracts are also valid even though
real estate mortgage was executed on the they are entered into by one of the parties without
subject property. The Genotivas complied under hope of advantage or profit. x x x
financial pressure. Later, when they offered to
redeem the collateral, BDO applied the payment Here, We fully agree with the appellate court's
to interest instead of the redemption. When observation that the Genotivas, in executing the
Goldland defaulted on the loan, BDO wrongfully subject contract in exchange for the release of
foreclosed the subject property. BDO argued that Violet's retirement benefits, agreed to accept
the Genotivas had an existing obligation to the what they thought was a better option. Being
bank through a previous deed of suretyship. The competent persons with experience in business
Regional Trial Court (RTC) declared the and banking, they negotiated for the release of
mortgage voidable and invalidated the application Violet's retirement benefits which was
of Php500,000 to interest. However, the Court of unfortunately impeded by her existing liability to
Appeals (CA) reversed the decision, stating that the bank. They cannot simply change their minds
BDO acted legally as a creditor against the and assail the validity of the subject contract after
Genotivas as sureties of Goldland's debt. they have received the benefits therefrom.
Similarly, there was no undue influence. There is What appears is that BDO took a shortcut in
undue influence "when a person takes improper collecting from the Genotivas. It unilaterally set-
advantage of his power over the will of another, off the amount of P500,000.00 to answer for
depriving the latter of a reasonable freedom of Goldland's due interest because the Genotiva
choice." We have held that "[f]or undue influence couple were solidarily liable for Goldland's loan
to be present, the influence exerted must have anyway. However, BDO may not set off the
so overpowered or subjugated the mind of a amounts without the consent of the spouses
contracting party as to destroy [their] free Genotiva because consent is required for
agency, making [them] express the will of conventional compensation.
another rather than [their] own." There is no
evidence of such degree of influence exerted by Neither can BDO invoke legal compensation
BDO on the spouses Genotiva in this case. The because the same requires each of the debtors
latter may have desperately needed Violet's to be bound principally, and in this case, while
retirement benefits, but there was no showing to the souses Genotiva are directly liable for
any degree that they were deprived of free Goldland's loan, their liability stems not from a
agency when they signed the subject contract. principal contract, but a secondary one, i.e. the
Deed of Suretyship. Thus, BDO's claim that its
The Genotivas had an option: they could have retention of the P500,000.00 is allowed under
desisted from offering to mortgage the subject the Deed of Suretyship lacks basis. Accordingly,
property and resorted to other means, such as said amount must be returned to the spouses
through judicial action, to obtain or process the Genotiva as prayed for and as adjudged by the
release of Violet's retirement benefits. Instead, RTC.
they "willing[ly]" mortgaged the subject property In fine, We find the subject contract to be valid
to sway BDO to release Violet's retirement as it was a product of the spouses Genotiva's
benefits. The bank could not be blamed for free will. However, BDO must return the amount
accepting what appeared to it as a reasonable of P500,000.00 to the Genotivas since it was
offer. The fact that the couple felt compelled, improperly applied to Goldland’s due interest.
under the circumstances, to mortgage the
subject property did not negate the voluntariness 2. OBJECT
of their act. ‘Object’ defined
‘The thing, right or service which is the subject
Courts cannot extricate competent persons from matter of the obligation arising from the
the consequences of contracts which are the contract.
product of their voluntary acts.
Requisites
Here, while We agree that the bank is entitled to a. Must be within the commerce of man;
collect from the spouses Genotiva, they being b. Should be real or possible;
solidarily liable under the Deed of Suretyship,
c. Should be licit; and
BDO may not precipitously deprive them of their
d. Should be determinate, or at least possible
property without due process of the law. The
of determination as to its kind.
manner by which it enforced the surety contract
violates the basic principle of due process. BDO
Things Which Cannot Be the Object of
claims that it rejected the offer for redemption.
Contracts
xxx What is apparent is that after the Genotivas
General Rule: All things or services may be the
made the offer, BDO responded through its
object of contracts.
January 31, 2001 Letter simply stating that "[t]he
XPN:
amount of [P]500,000.00 remitted to [BDO] has
• Things outside the commerce of men;
been applied to past due interest.“
• Intransmissible rights;
• Future inheritance except in cases expressly
If BDO indeed rejected the offer, the proper
authorized by law.
course of action for the bank was to return the
• Services contrary to law, morals, good
amount to the spouses Genotiva or inquire if the
customs, public order or public policy;
latter would be interested in applying the
• Impossible things or services;
payment to Goldland's due interest. BDO may
• Objects not possible of determination as to
not simply retain the money and apply it to
another account under the excuse that it was
their kind. [Articles 1347-1349]
exercising its right as a creditor to collect from
the sureties. Again, while the bank indeed has 3. CAUSE OR CONSIDERATION
the right to proceed against the spouses ‘Cause’ or ‘Consideration’ defined
Genotiva, it must do so through lawful means, It is the immediate, direct or most proximate
i.e., through the institution of proceedings for reason which explains and justifies the creation
collection or enforcement of the surety contract. of an obligation through the will of the
contracting parties.
Essential Requisites of Cause There is total lack of evidence which would

a. Existing at the time of the celebration of establish that Natividad expressly agreed to the
the contract; arrangement that the financial aid extended to
b. Licit or lawful; and her would be treated as consideration for the
c. True sale of the subject property.
• Cause or consideration is the WHY of
the contract. It is the essential Determinate Subject Matter and Price
reason which moves the contracting Certain in Money.
parties to enter into the contract. The object of the supposed sale in the instant
case is ambiguous. It is well settled that the
Article 1350. In onerous contracts the cause object of every contract must be determinate.
is understood to be, for each contracting "The requisite that a thing be determinate is
party, the prestation or promise of a thing or satisfied if at the time the contract is entered
service by the other; in remuneratory ones, into, the thing is capable of being made
the service or benefit which is remunerated; determinate without the necessity of a new or
and in contracts of pure beneficence, the further agreement between the parties.“
mere liberality of the benefactor.
Petitioner relied on the October 22, 1990 and
Article 1351. The particular motives of the January 23, 1991 receipts to prove that
parties in entering into a contract are different Natividad transferred and conveyed to
from the cause thereof. petitioner the former's 771-square meter
portion of Lot 512-C. But as mentioned above,
Article 1352. Contracts without cause, or with said receipts are null and void, and thus, should
not be given evidentiary weight and credence.
unlawful cause, produce no effect whatever.
The cause is unlawful if it is contrary to law,
Notably, even if we consider the receipts
morals, good customs, public order or public
presented by petitioner, the exact portion of Lot
policy.
512-C allegedly sold to petitioner was not
specified. The phrase "[t]his amount is payment
Article 1353. The statement of a false cause
only for two lots" renders the object of the sale
in contracts shall render them void, if it should
ambiguous as it does not even define the
not be proved that they were founded upon
metes and bounds of the lots which are
another cause which is true and lawful.
supposedly the subject of the sale.
Article 1354. Although the cause is not stated The price for the sale of the subject property is
in the contract, it is presumed that it exists and also uncertain. Other than her bare testimonies,
is lawful, unless the debtor proves the petitioner's claim that she extended financial
contrary. aid to Natividad was not supported by
corroborating evidence. Although the litigation
Article 1355. Except in cases specified by expenses spent by petitioner form part of the
law, lesion or inadequacy of cause shall not purchase price of the subject property, no
invalidate a contract, unless there has been receipt of expenses was presented by
fraud, mistake or undue influence. petitioner which would aid this Court to
determine the exact amount thereof. This
Seming v. Alamag undetermined amount of expenses all the more
G.R. No. 202284, March 17, 2021 renders the price or consideration of the sale
J. Hernando ambiguous.
Ruling:
There is no contract of sale between petitioner ARAKOR CONSTRUCTION AND DEVT.
and Natividad. CORP. V STA. MARIA
G.R. No. 215006, January 11, 2021
Natividad did not consent to enter into any J. Hernando
contract of sale involving her half portion of Facts:
Lot 512-C, completely belying petitioner's • The Sps. Gaddi owned the five parcels of
testimony and the contents of the October 22, land located in Hermosa, Bataan. Felicidad
1990 and January 23, 1991 receipts. Simply died intestate and was survived by Fernando
put, there was in reality no meeting of the Sr. and her eight children, the Gaddis.
minds with respect to the alleged sale of the Felicidad's heirs inventoried her properties
subject property. There is no clear and but they did not initiate its partition; thus, the
convincing evidence that Natividad definitely parcels of land remained in the name of the
sold the subject property to petitioner. Sps. Gaddi.
• Fernando Sr. passed away, followed by one • More importantly, "if any one party to a
of the Gaddis, Efren. After their deaths, supposed contract was already dead at
Atty. Legaspi, the president of petitioner the time of its execution, such contract is
Arakor, informed the Gaddis that their undoubtedly simulated and false and,
parents had already sold the contested five therefore, null and void by reason of its
parcels of land to Arakor for P400,000.00
having been made after the death of the
as evidenced by two undated Deeds of
party who appears as one of the
Absolute Sale and that the titles to the
contracting parties therein." The
properties have already been transferred to
Arakor's name.
Certification pertaining to Ambrosio should
• Thus, the Gaddis filed a Complaint for be considered as proof that he was
Annulment of Deed[s] of Absolute Sale and already deceased long before the
Transfer Certificates of Title against Arakor. execution of the Deed of Absolute Sale.
They alleged that the two contracts of sale As stated by the City Civil Registrar in the
were forged and the conveyance of the Certification, the office has a record of
properties was fraudulent since Felicidad Ambrosio's death. As long as one
could not have signed the documents and contracting party to the contract is proven
given her consent thereon since she has with evidence to be dead at the time of
been dead for seven years before the the execution of the contract - in this
alleged execution of the said contracts. case, Ambrosio - the Deed of Absolute
Issue: Sale should be considered as definitely
WoN the Deeds of Absolute Sale are null and simulated. Thus, it produced no legal
void for being forged and fictitious. effect.
Ruling: • Considering that the Gonzagas could not
• Case law provides that "forgery cannot be have signed the Deed of Absolute Sale,
presumed and must be proved by clear, the said contract is null and void. In the
positive and convincing evidence by the same manner, the deed did not convey
party alleging the same." In this case, the any legal title to the petitioner.
Gaddis satisfactorily discharged this burden Consequently, TCT T-42198, which was
by submitting in evidence the Certificate of
issued in the name of the City of Tanauan
Death of Felicidad to prove that her demise
"by virtue of the said spurious and forged
preceded the execution of the contracts of
document is also null and void."
sale. This is in addition to Arakor's
admission that Felicidad's death occurred
Furthermore, "all the transactions, [if any],
before the sale transpired. Obviously, she subsequent to the alleged sale are
could not have signed any document which likewise void.“
leads to no other conclusion than that her
signatures in the deeds were forged. D. DEFECTIVE CONTRACTS
• More importantly, "if any one party to a 1. Rescissible Contracts
supposed contract was already dead at the 2. Voidable Contracts
time of Its execution, such contract is
3. Unenforceable Contracts
undoubtedly simulated and false, and,
4. Void Contracts
therefore, null and void by reason of its
having been made after the death of the
party who appears as one of the contracting 1. RESCISSIBLE CONTRACTS (Arts 1380-
parties therein." Indeed, "no one can give 1389)
what one does not have; nemo dat quod ‘Rescissible Contracts’ defined
non habet. One can sell only what one Contracts which are valid but defective
owns or is authorized to sell, and the buyer because of injury or damage to either of the
can acquire no more right than what the contracting parties or to third persons, as a
seller can transfer legally." Considering that consequence of which it may be rescinded
Felicidad's signatures were forged, the by means of a proper action for rescission.
Deeds of Absolute Sale are null and void
and convey no title to Arakor. Thus, the Article 1381. The following contracts are
TCTs which were issued in favor of Arakor rescissible:
"by virtue of the said spurious and forged 1) Those which are entered into by
document are also null and void." In fact, guardians whenever the wards whom
"all the transactions subsequent to the they represent suffer lesion by more than
alleged sale are likewise void." one-fourth of the value of the things
which are the object thereof;
2) Those agreed upon in representation of Note: A guardian is authorized only to

absentees, if the latter suffer the lesion manage the estate of the ward; should he
stated in the preceding number; dispose a portion thereof without authority
3) Those undertaken in fraud of creditors from the court by way of a contract, the
when the latter cannot in any other manner
same is unenforceable under Art. 1403 (1),
collect the claims due them;
irrespective of whether there is lesion or
4) Those which refer to things under litigation
if they have been entered into by the not.
defendant without the knowledge and
approval of the litigants or of competent Requisites before a contract entered
judicial authority; into in FRAUD OF CREDITORS may be
5) All other contracts specially declared by law rescinded:
to be subject to rescission. 1. There is a credit existing prior to the
celebration contract;
Article 1382. Payments made in a state of 2. There is fraud, or at least, the intent to
insolvency for obligations to whose fulfillment commit fraud to the prejudice of the
the debtor could not be compelled at the time creditor seeking rescission;
they were effected, are also rescissible.
3. Creditor cannot in any legal manner
Contracts that are rescissible (Arts. 1381-
collect his credit; and
1382) 4. Object of the contract must not be
legally in the possession of a third
A. Lesion person who did not act in bad faith.
1. Those entered into by guardians where The action to rescind contracts in fraud of
the ward suffers lesion of more than ¼ of creditors is known as accion pauliana.
the value of the things which are objects
thereof. Effect If Contract Entered Into By
2. Those agreed upon in representation of Guardian
absentees, if the latter suffer lesion by • If contract was entered into by guardian
more than ¼ of the value of the things
upon securing court approval, the
which are subject thereof.
contract is not rescissible
B. Fraud notwithstanding alleged lesion.
1. Those undertaken in fraud of creditors • If the guardian entered into a contract
when the latter cannot in any manner that requires court approval and the
claim what are due them. (accion same was not secured, the contract is
pauliana) unenforceable under Art. 1403 (1),
2. Those which refer to things under irrespective of whether there is lesion or
litigation if they have been entered into by not because it was entered into in the
the defendant without the knowledge and name of another without authority.
approval of the litigants and the court.
3. Payments made in a state of insolvency
Requisites of rescission:
for obligations whose fulfillment the debtor
1. Contract must be rescissible under
could not be compelled at the time they
were effected. Arts. 1381 and 1382.
2. Party asking for rescission must have
Requisites before a contract entered into in no other legal means to obtain
behalf of wards or absentees may be reparation for the damages suffered
rescinded on the ground of LESION: by him. [Article 1383]
• Those which are derived from the nature of 3. Person demanding rescission must be
the contract and ordinarily accompany the able to return whatever he may be
same; they are presumed by law (i.e obliged to restore if rescission is
warranty against eviction in sale, although granted. [Article 1385]
the contracting parties may increase, 4. Things which are the object of the
diminish or even suppress it.)
contract must not have passed legally
• If contract was entered into by guardian
upon securing court approval, the contract is
to the possession of a third person
not rescissible notwithstanding alleged acting in good faith [Article 1385]; and
lesion. 5. Action must be brought within four
• The lesion must be known or could have years. [Article 1389]
been known at the time of making of the
contract.
PRESUMED IN FRAUD OF CREDITORS 2. VOIDABLE CONTRACTS

Article 1387. All contracts by virtue of which
the debtor alienates property by gratuitous title Those which possess all the essential
are presumed to have been entered into in elements for validity but the consent is
fraud of creditors, when the donor did not vitiated either by lack of legal capacity of one
reserve sufficient property to pay all debts of the contracting parties or by mistake
contracted before the donation.
violence, intimidation, undue influence or
• Alienations by onerous title are also
fraud even though there may have been no
presumed fraudulent when made by persons
damage to the contracting parties.
against whom some judgment has been
rendered in any instance or some writ of
attachment has been issued. The decision or Cause - The following contracts are voidable
attachment need not refer to the property or annullable:
alienated, and need not have been obtained 1. Those where ONE of the parties is
by the party seeking the rescission. incapable of giving consent to a
• In addition to these presumptions, the design contract;
to defraud creditors may be proved in any 2. Those where the consent is vitiated by
other manner recognized by the law of mistake, violence, intimidation, undue
evidence. influence of fraud (Art. 1390)
SIGUAN V LIM Fraud has been defined to include an

G.R. NO. 134685, NOVEMBER 19, 1999 inducement through insidious machination.
Ruling: Insidious machination refers to a deceitful
• The action to rescind contracts in fraud of
scheme or plot with an evil or devious
creditors is known as accion pauliana. For
purpose. Deceit exists where the party, with
this action to prosper, the following
intent to deceive, conceals or omits to state
requisites must be present: (1) the plaintiff
asking for rescission has a credit prior to the material facts and, by reason of such
alienation, although demandable later; (2) omission or concealment, the other party
the debtor has made a subsequent contract was induced to give consent that would not
conveying a patrimonial benefit to a third otherwise have been given. (R.S. Tomas v.
person; (3) the creditor has no other legal Rizal Cement Comp. G.R.No.173155)
remedy to satisfy his claim; (4) the act being
impugned is fraudulent; (5) the third person Prescriptive Period for Action for
who received the property conveyed, if it is Annulment
by onerous title, has been an accomplice in ● Contracts entered into by incapacitated
the fraud. person – within 4 years from the time
• The general rule is that rescission requires guardianship ceases;
the existence of creditors at the time of the ● Where consent is vitiated by violence,
alleged fraudulent alienation, and this must intimidation or undue influence – within
be proved as one of the bases of the judicial 4 years from the time such violence,
pronouncement setting aside the contract.
intimidation or undue influence ceases;
Without any prior existing debt, there can
● Where consent is vitiated by mistake or
neither be injury nor fraud. While it is
necessary that the credit of the plaintiff in the fraud – within 4 years from the time of
accion pauliana must exist prior to the the discovery of such mistake or fraud.
fraudulent alienation, the date of the [Article 1391]
judgment enforcing it is immaterial. Even if
the judgment be subsequent to the Who May Institute Action For Annulment
alienation, it is merely declaratory, with General Rule: Action for annulment may be
retroactive effect to the date when the credit instituted by all who are thereby obliged
was constituted. principally or subsidiarily. A stranger to the
• For this presumption of fraud to apply, it contract cannot institute an action for
must be established that the donor did not annulment. [Article 1397]
leave adequate properties which creditors
might have recourse for the collection of Requisites For Action For Annulment:
their credits existing before the execution of a. Plaintiff must have interest in the
the donation. Petitioner's alleged credit contract;
existed only a year after the deed of
b. Plaintiff is the victim and not the party
donation was executed. She cannot,
responsible for the vice or defect.
therefore, be said to have been prejudiced or
defrauded by such alienation.
Ratification d) An agreement for the sale of goods, chattels

• May be effected expressly or tacitly. or things in action, at a price not less than
• It is understood that there is tacit ratification if, five hundred pesos;
with knowledge of the reason which renders e) An agreement for the leasing for a longer
the contract voidable and such reason having period than one year, or for the sale of real
ceased, the person who has a right to invoke property or of an interest therein;
it should execute an act which necessarily f) A representation as to the credit of a third
implies and intention to waive his right. person.
• It does not require conformity of the party who
has no right to bring the action. Application of Statute of Frauds
• It cleanses the contract from all its defect from Applies to:
the moment it was constituted. • Executory Contracts
Does not apply to:
Effects of Annulment • Contracts that are partially or completely
• In contract has not yet been consummated fulfilled;
parties shall be released from the obligations • Actions which are neither for specific
arising therefrom; performance of the contract nor for the
• If the contract has already been violation thereof.
consummated, rules provided in Articles
1398-1402 shall govern. Note: The provision mentions “unenforceable by
• Arts. 1398-1399 – Obligation of mutual action.” The prohibition, thus, applies on actions
restitution. which spring from the enforcement of the
• Arts. 1400-1402 – Effect of failure to make contract.
restitution.
Ratification of Contracts Infringing the
3. UNENFORCEABLE CONTRACTS Statute of Frauds
Those which cannot be enforced by proper Such contracts may be ratified by:
action unless they are ratified, because, either: • Failure to object to the presentation of oral
1. They are entered into without or in excess of evidence to prove such contracts; or
authority (Art 1403 (1); Art. 1317); • Acceptance of benefits under these contracts.
2. They do not comply with the Statute of frauds [Article 1405]
(Art. 1403 (2), see supra under Forms of
Contracts ; Note: The unenforceability of a contract can only
3. Both contracting parties do not possess the be assailed by parties thereto (Art. 1408). This
required legal capacity. defense is personal to the party to the
Note: agreement.
• The Statute of frauds applies only to
EXECUTORY CONTRACTS, not to those THE HEIRS OF ANSELMA GODINES V
that are partially or completely fulfilled. DEMAYMAY
• Further, the statute does not apply to actions G.R. No. 230573, June 28, 2021
which are neither for specific performance of J. Hernando
the contract nor for the violation thereof. Take Ruling:
note that the provision mentions The oral sale between Anselma and the
“unenforceable by action.” The prohibition, spouses Demaymay is valid, petitioners, being
thus, applies on actions which spring from the the heirs of Anselma, are legally bound by the
enforcement of the contract. said oral sale.
Indeed, contracts that have all the essential
Reason Contracts Become Unenforceable requisites for their validity are obligatory
1. They are entered into without or in excess of regardless of the form they are entered into,
authority [Article 1403 (1); Article 1317]; except when the law requires that a contract be
2. They do not comply with the Statute of in some form to be valid or enforceable. Article
frauds [Article 1403 (2)]; 1358 of the Civil Code provides that the
3. Both contracting parties do not possess the following must appear in a public instrument:
required legal capacity.
Acts and contracts which have for their object
STATUTE OF FRAUDS the creation, transmission, modification or
a) An agreement that by its terms is not to be extinguishment of real rights over immovable
performed within a year from the making property; sales of real property or of an interest
thereof; therein are governed by articles 1403, No.2, and
b) A special promise to answer for the debt, 1405;
default, or miscarriage of another;
c) An agreement made in consideration of The cession, repudiation or renunciation of
marriage, other than a mutual promise to hereditary rights or of those of the conjugal
marry; partnership of gains;
The power to administer property, or any other 4. VOID CONTRACTS

power which has for its object an act appearing In general, they are those which lack
or which should appear in a public document, absolutely either in fact or in law one or some
or should prejudice a third person; of the elements essential for its validity.
The cession of actions or rights proceeding Note: The defense of illegality of contract is
from an act appearing in a public document. not available to third persons whose interests
Article 1403(2) of the Civil Code, otherwise are not directly affected (Art. 1421)
known as the Statute of Frauds, requires that A contract which is the direct result of a
covered transactions must be reduced into previous illegal contract, is also void and
writing; otherwise, the same would be inexistent (Art. 1422)
unenforceable by action. In other words, a sale
of real property must be evidenced by a written Contracts which are INEXISTENT and VOID
document as an oral sale of immovable AB INITIO
property is unenforceable.
1) Those whose cause, object or purpose is
contrary to law, morals, good customs,
However, this does not necessarily mean that
public order or public policy;
oral contracts of sale of real property are void
2) Those which are absolutely simulated or
or invalid. We have held that failure to observe
fictitious;
the prescribed form of contracts does not
invalidate the transaction.
3) Those whose cause or object did not
exist at the time of the transaction;
The form prescribed by law is for evidentiary 4) Those whose object is outside the
purposes, non-compliance of which does not commerce of men;
make the contract void or voidable, but only 5) Those which contemplate an impossible
renders the contract unenforceable by any service;
action. 6) Those where the intention of the parties
relative to the principal object of the
In fact contracts which do not comply with the contract cannot be ascertained; and
Statute of Frauds are ratified by the failure of 7) Those expressly prohibited or declared
the parties to object to the presentation of oral void by law. [Article 1409]
evidence to prove the same, or by an
acceptance of benefits under them. Other Contracts Which Are Deemed Void
A contract which is the direct result of a
Further, the Statute of Frauds is confined to previous illegal contract [Article 1422]
executory contracts where there is a wide field
for fraud as there is no palpable evidence of the Illegality of Contract
intention of the contracting parties. It has no The defense of illegality of contract is not
application to executed contracts because the available to third persons whose interests are
exclusion of parol evidence would promote not directly affected. [Article 1421]
fraud or bad faith as it would allow parties to
keep the benefits derived from the transaction Summary of the Civil Effects of a Void
and at the same time evade the obligations Contract
imposed therefrom. • Neither party may seek to enforce a void
contract, irrespective of the reason that
The Court agrees with the observations of the made it void.
CA that the Statute of Frauds is inapplicable in • Neither party may seek the aid of the law or
the present case as the verbal sale between the courts, and both parties shall be
Anselma and the spouses Demaymay had deemed in pari delicto.
already been partially consummated when the
former received the initial payment of Pl,010.00 Principle of In Pari Delicto [Articles 1411-
from the latter. In fact, the said sale was 1417]
already totally executed upon receipt of the
General Rule: When the defect of a void
balance of P450.00.
contract consists in the illegality of the cause
or object of the contract, and both of the
Considering that the oral sale between
parties are at fault or in pari delicto, the law
Anselma and the spouses Demaymay is valid
refuses them any remedy and leaves them
(and is actually enforceable by virtue of the
partial, if not total consummation of the
where they are.
contract), petitioners, being the heirs of XPN:
Anselma, are legally bound by the said oral 1. Payment of usurious interest.
sale.
2. Payment of money or delivery of property Issue/s:

for an illegal purpose, where the party who i. WoN the sale is void.
paid or delivered repudiates the contract ii. WoN the property should be returned to
before the purpose has been the Heirs of Anastacio.
accomplished, or before any damage has iii. WoN the action is barred by laches.
been caused to a third person Ruling:
3. Payment of money or delivery of property Having been executed within the five-year
made by an incapacitated person prohibitory period, the Deed of Sale, as correctly
4. Agreement or contract is not illegal per se ruled by the CA, is void ab initio. And under
but merely prohibited by law, and the prevailing jurisprudence, the property should
prohibition is designed for the plaintiff’s rightly be returned to respondents considering
protection that the government has not yet filed an action
5. Payment of any amount in excess of the for reversion. As the Court has consistently
maximum price of any article or commodity ruled, reversion under Section 101 of the Public
fixed by law Land Act is not automatic as the Office of the
6. Contract whereby a laborer undertakes to Solicitor General must first file an action for
work longer than the maximum number of reversion.
hours fixed by law
7. Contract whereby a laborer accepts a wage The CA likewise correctly ordered respondents
lower than the minimum wage fixed by law to reimburse petitioners the purchase price of
8. In case of divisible contracts, the legal the sale since the Deed of Sale is void ab initio.
terms may be enforced separately from the As to the improvements made on the land and
illegal terms the interests on the purchase price, these are
compensated by the fruits petitioners had
HEIRS BAGAYGAY v. HEIRS PACIENTE received from their long possession of the
G.R. No. 212126, August 04, 2021 homestead pursuant to the ruling of the Court in
Facts: the case of Sps. Maltos v. Heirs of Eusebio
• On October 8, 1953, Anastacio Paciente, Sr. Borromeo, which reads:
(Anastacio) was granted a homestead patent
over a parcel of land in the Province of In Arsenal, the property covered by a homestead
Cotabato. Accordingly, Original Certificate of patent had been sold to Suralta in 1957, while
Title (OCT) No. V-2423 was issued in his the Complaint was filed before the trial court in
name. Thereafter, by virtue of a Deed of Sale 1974. The case was decided by this court in
allegedly executed by Anastacio in favor of his 1986. Thus, Suralta had been in possession of
brother-in-law, Eliseo Bagaygay (Eliseo), the the property for approximately 17 years before a
latter took possession of the subject land, Complaint was filed. This court held that:
transferred the title under his name, and later
caused the subdivision of the entire land into The value of any improvements made on the
three (3) lots. land and the interests on the purchase price are
• On March 7, 1989, Anastacio died. Two years compensated by the fruits the respondent
later, on March 18, 1991, Eliseo likewise Suralta and his heirs received from their long
passed away. The Heirs of Eliseo took possession of the homestead. Angeles and
possession of the subject land upon his death. Arsenal both involved the sale of a parcel of land
• On December 21, 1999, the heirs of Anastacio covered by a homestead patent within the five-
filed before the RTC an action for Declaration year prohibitory period. These cases also
of Nullity of the Deed of Sale and the titles,
involved the introduction of improvements on the
Recovery of Ownership.
parcel of land by the buyer. Restating the
• Respondents alleged that sometime in 1956,
rulings in Angeles and Arsenal, this court finds
Eliseo, taking advantage of the financial
that while the rule on in pari delicto does not
distress of Anastacio, was able to obtain the
apply if its effect is to violate public policy, it is
latter's title and take possession of his land;
applicable with regard to the value of the
that despite repeated demands by Anastacio,
improvements introduced by petitioner Eliseo
Eliseo refused to return the title and
Maltos. Petitioners had been in possession of
possession of the land; that Eliseo caused the
the land for 20 years before the heirs of
cancellation of Anastacio's title through a
Borromeo filed a Complaint. The expenses
fictitious Deed of Sale; that Anastacio never
incurred by petitioners in introducing
sold the subject land; and that the said Deed
improvements on the land for which they seek
of Sale was likewise void as it was executed
reimbursement should already be compensated
during the five (5)-year period of prohibition
by the fruits they received from the
under Section 118 of the Public Land Act.
improvements. xxx
• The RTC dismissed the complaint. The CA
reversed the RTC and ruled that the sale is
Laches does not apply to void ab initio contracts.
void for violation of the 5-year prohibition.
Likewise without merit petitioners' defense of The positive mandate of Art. 1410 of the
laches. In the Heirs of Alido v. Campano, the New Civil Code conferring imprescriptibility
Court made it clear that laches do not apply to void to actions for declaration of the inexistence
ab initio contracts. It explained –
of a contract should pre-empt and prevail
Laches, however, do not apply if the assailed over all abstract arguments based only on
contract is void ab initio. In Heirs of Ingjug-Tiro v. equity.
Spouses Casals, the Court expounded that laches Certainly, laches cannot set up to resist the
cannot prevail over the law that actions to assail a enforcement of an imprescriptible legal right,
void contract are imprescriptible it being based on and petitioners can validly vindicate their
equity, to wit: inheritance despite the lapse of time.
In actions for reconveyance of property predicated
on the fact that the conveyance complained of was As above-mentioned, a sale of a parcel of
null and void ab initio, a claim of prescription of land is in violation of the five year prohibition
action would be unavailing. "The action or defense on the alienation of land acquired via patent
for the declaration of the inexistence of a contract application is void and produces no legal
does not prescribe." Neither could laches be effect. As successors-in-interest of Alido,
invoked in the case at bar. Laches is a doctrine in petitioners' right to challenge the sale
equity and our courts are basically courts of law
and not courts of equity. Equity, which has been
between Alido and respondent cannot be
aptly described as "justice outside legality," should barred by laches as it was in violation of the
be applied only in the absence of, and never restriction on the sale of land acquired
against, statutory law. through free patent.
Void Voidable Rescissible Unenforceable
As to cause of defect
Defect is caused by excess
Defect is caused by lacking Defect is caused by Defect is caused by or lack of authority, does
absolutely either in fact or vitiation of consent or in the injury/damage either to one not comply with the Statute
in law one or some of the legal capacity of one of the of the parties or to a third of Frauds, or both
elements of validity. contracting parties. person. contracting parties are
legally incapacitated.
As to effect
Valid and enforceable until Valid and enforceable until
GR: does not produce any Cannot be enforced by a
annulled by a competent rescinded by a competent
legal effect. proper action in court.
court. court.
As to prescription
Corresponding action for
Action/defense for the
Action for annulment or recovery if there was total
declaration of nullity or Action for rescission may
defense of annullability or partial performance
inexistence does not prescribe.
may prescribe. under No. 1 or 3 of Art.
prescribe.
1403 may prescribe.
As to curability
Not cured by prescription Cured by prescription Cured by prescription Not cured by prescription
As to ratification
Cannot be ratified Can be ratified Need not be ratified Can be ratified
Can be ratified
Assailed by a contracting
Assailed by a contracting
Assailed only by a party or a third party who is Assailed only by a
party or a third party whose
contracting party. prejudiced or damaged by contracting party.
rights are directly affected.
the contract.
Direct or collateral attack
Direct or collateral Direct Direct Direct or collateral
III. NATURAL OBLIGATIONS

‘Natural Obligations’ defined Requisites
• Natural obligations are those based on 1. a debt;
equity and natural law, which are not 2. the right of action over the debt having
enforceable by means of a court action, prescribed;
but which, after voluntary fulfillment by the 3. payment made by a third person;
obligor, authorize the retention by the 4. such payment being against the will or
obligee of what has been delivered or without the knowledge of the debtor; and
rendered by reason thereof. 5. debtor's act of reimbursing the third person
• There refer to obligations without a for the payment made. In this case, the
debtor can no longer recover what he has
sanction, susceptible of voluntary
paid; this is a natural obligation.
performance, but not through compulsion
by legal means.
Voluntary performance despite failed
action
Distinguished from civil obligations When, after an action to enforce a civil
• Civil obligations are based on positive law obligation has failed, the defendant voluntarily
 Natural obligations are based on performs the obligation, he cannot demand
equity and natural law the return of what he has delivered or the
• Civil obligations are enforceable by court payment of the value of the service he has
action rendered. (Article 1428)
 Natural obligations are not
enforceable by court action Payment by heir
When a testate or intestate heir voluntarily
Prescribed civil action pays a debt of the decedent exceeding the
When a right to sue upon a civil obligation value of the property which he received by will
has lapsed by extinctive prescription, the or by the law of intestacy from the estate of
obligor who voluntarily performs the contract the deceased, the payment is valid and cannot
cannot recover what he has delivered or the be rescinded by the payer. (Article 1429)
value of the service he has rendered. (Article
1424) Requisites
• The voluntary performance or payment by 1. the decedent incurred a debt;
the obligor despite prescription thereof 2. his heir voluntary pays the debt; and
converts it to a natural obligation. 3. the debt exceeds the value of the heir's
share.
Requisites
Payment of legacy by intestate heir
1. a civil obligation;
When a will is declared void because it has
2. the right of action over such civil
not been executed in accordance with the
obligation having lapsed; formalities required by law, but one of the
3. the lapse being due to extinctive intestate heirs, after the settlement of the
prescriptive; and debts of the deceased, pays a legacy in
4. performance or payment done compliance with a clause in the defective will,
voluntarily. The effect of this is that the the payment is effective and irrevocable.
obligor can no longer recover what he (Article 1430)
has delivered or the value of the service
he rendered. Requisites
1. there is a will;
Reimbursement for payment by third 2. the will provides a legacy;
person for a prescribed civil obligation 3. the will is declared void due to
2. When without the knowledge or against formalities; and
the will of the debtor, a third person pays a 4. an intestate heir nevertheless pays the
debt which the obligor is not legally bound to legacy.
pay because the action thereon has
prescribed, but the debtor later voluntarily
reimburses the third person, the obligor
cannot recover what he has paid. (Article
1425)
SPECIAL CONTRACTS
I. SALES
A. Definition and Essential Requisites F. Breach of Contract of Sale
B. Contract of Sale G. Extinguishment of the Sale
C. Earnest Money H. Equitable Mortgage
D. Double Sales I. Pacto de Retro Sales
E. Risk of Loss
A. DEFINITION & ESSENTIAL The buyer and the seller must agree on the
following:
REQUISITES
(a) the purchase price; and
(b) the thing to be sold and paid for.
‘Contract of Sale’ defined
By the contract of sale one of the contracting
PALATTAO V. COURT OF APPEALS
parties obligates himself to transfer the
G.R. No. 131726, May 7, 2002
ownership and to deliver a determinate thing,
Contracts that are consensual in nature, like a
and the other to pay therefor a price certain in
contract of sale, are perfected upon mere
money or its equivalent. A contract of sale may
meeting of the minds. Once there is
be absolute or conditional. (Art. 1458 NCC)
concurrence between the offer and the
acceptance upon the subject matter,
Characteristics
consideration, and terms of payment, a contract
• Consensual – perfected by mere consent.
is produced. The offer must be certain. To
• Bilateral – seller will deliver/transfer a
convert the offer into a contract, the acceptance
determinate thing and the buyer will pay an
must be absolute and must not qualify the
ascertained price or its equivalent.
• Principal – existence does not depend upon terms of the offer; it must be plain, unequivocal,
unconditional, and without variance of any sort
the validity of another contract
• Onerous – the thing is conveyed in from the proposal. A qualified acceptance, or
consideration of the purchase price, and vice one that involves a new proposal, constitutes a
versa. counter-offer and is a rejection of the original
• Nominate – has a specific name given by offer. Consequently, when something is desired
law which is not exactly what is proposed in the
offer, such acceptance is not sufficient to
ESSENTIAL REQUISITES generate consent because any modification or
The essential elements of a contract of sale are variation from the terms of the offer annuls the
the following: offer.
1. Consent or meeting of the minds - consent
to transfer ownership in exchange for the CAPACITY TO BUY AND SELL
price; General Rule: All persons who are authorized
2. Determinate subject matter; and to obligate themselves, may enter into a
3. Price certain in money or its equivalent. contract of sale.
Disqualifications:
1. CONSENT 1. Husband and wife cannot sell property to
‘Consent’ defined each other; Except: Separation of
• meeting of the minds to transfer the property
ownership in exchange for the price. 2. The following cannot acquire by
• the seller must agree to receive a purchase purchase, even at public or judicial
price certain from the buyer to whom he auction, either in person or through
shall deliver the thing purchased and, another:
• the buyer must agree to pay a purchase a. Guardian, the property of the person or
price certain to the seller who binds himself persons who may be under his
to deliver to the buyer the thing purchased. guardianship
b. Agents, the property whose
Article 1319. Consent is manifested by the administration or sale may have been
meeting of the offer and the acceptance upon entrusted to them, unless the consent
the thing and the cause which are to constitute of the principal has been given;
the contract. The offer must be certain and the c. Executors and administrators, the
acceptance absolute. A qualified acceptance property of the estate under
constitutes a counter-offer. xxx administration.
186
d. Public officers and employees, the

Note:
property of the State or of any
Such prohibition shall likewise apply to common
subdivision thereof, or of any
law spouses;
government-owned or controlled
If already sold to a third person who relied on the
corporation, or institution, the
title of his immediate seller, reconveyance to the
administration of which has been
seller spouse is no longer available
intrusted to them; this provision shall
apply to judges and government
Effect of Relative Incapacity – Void
experts who, in any manner
whatsoever, take part in the sale
Effect of Specific Incapacity
e. Justices, judges, prosecuting attorneys,
GR: Contracts expressly prohibited by law are
clerks of superior and inferior courts,
void and cannot be ratified.
and other officers and employees
Except: Sales entered into by guardians,
connected with the administration of
administrators, and agents may be ratified by
justice, the property and rights in
means of and in the form of a new contract when
litigation or levied upon an execution
the cause of nullity has ceased to exist.
before the court within whose
Note: This is actually not ratification of a void
jurisdiction or territory they exercise their
contract, but the execution of a new contract
respective functions; this prohibition
which is valid and effective only upon date
includes the act of acquiring by
execution.
assignment and shall apply to lawyers,
with respect to the property and rights
2. SUBJECT MATTER
which may be the object of any litigation
‘Subject Matter’ defined
in which they may take part by virtue of
• determinate thing which is the object of the
their profession.
contract.
f. Any others specially disqualified by law.
• The seller and the buyer must agree to sell
(Arts 1490-1491)
and buy a thing certain.
• If they cannot agree as to which thing is to be
Kinds of Incapacity
sold and bought, there is no meeting of the
• Absolute – in case of persons who cannot
minds.
bind themselves
• Relative – when certain persons, under
Requisites for a Valid Subject Matter
certain circumstances, cannot buy certain
• Within the commerce of men
property (Wolfson v. Estate of Martinez, G.R.
• Must be licit
No. L-5970, October 13, 1911)
• Existing, Future, Contingent
• Special Disqualification – Art 1491-1492,
• Determinate or Determinable
NCC
Article 1460. NCC states that the "requisite that
Absolute Incapacity
the thing be determinate is satisfied if at the time
• Minors
the contract is entered into, the thing is
• Insane or Demented
capable of being made determinate without
• Deaf-mutes who do not know how to write
the necessity of a new or further agreement
• Civil Interdiction
between the parties"
• Judicially declared incompetent
EMPTIO REI SPERATAE V. EMPTIO SPEI
In case of Necessaries referred to in Art 290
Where necessaries are those sold and delivered EMPTIO REI EMPTIO SPEI
to a minor or other person without capacity to SPERATAE
act, he must pay a reasonable price therefor.
(Art 1489, NCC) Sale of a thing Sale of mere hope or
having potential expectancy.
Effect of Absolute Incapacity existence.
• Both parties are incapacitated –
unenforceable Uncertainty is with Uncertainty is with
• One party is incapacitated – voidable regard to the quantity regard to the existence
and quality of the of the thing
Relative Incapacity thing and not the
GR: Husband and wife cannot sell property to existence of the
each other thing.
Except:
• When a separation of property was agreed Object is a future Object is a present
upon in the marriage settlements thing, which must be thing, which is the hope
• When there has been a judicial separation of determinate or or expectancy.
property specific.
Sale is subject to a Sale is effective even if SEMING V. ALAMAG

suspensive condition the thing does not G.R. No. 202284, March 17, 2021
– that the thing will come into existence, J. Hernando
exist. Such that if it since the subject matter Ruling:
does not exist, there is the hope itself, • There is no contract of sale between
is no contract for lack unless it is a vain hope. petitioner and Natividad.
of an object. • There is total lack of evidence which would
establish that Natividad expressly agreed to
3. PRICE CERTAIN IN MONEY OR ITS the arrangement that the financial aid
EQUIVALENT extended to her would be treated as
Requisites for a Valid Consideration consideration for the sale of the subject
property.
• Certain or ascertainable at the time of
• The object of the supposed sale in the instant
perfection
case is ambiguous. It is well settled that the
• In money or its equivalent object of every contract must be determinate.
• Real "The requisite that a thing be determinate is
satisfied if at the time the contract is entered
Payment of the Price into, the thing is capable of being made
The vendor shall not be bound to deliver the determinate without the necessity of a new or
thing sold, if the vendee has not paid him the further agreement between the parties."
price, or if no period for the payment has • Notably, even if we consider the receipts
been fixed in the contract. presented by petitioner, the exact portion of
Lot 512-C allegedly sold to petitioner was not
General Rule: Delivery must be specified. The phrase "[t]his amount is
simultaneous with the payment of the price payment only for two lots" renders the object
of the sale ambiguous as it does not even
XPN: Even without payment, delivery must
define the metes and bounds of the lots
be made if a period for payment has been which are supposedly the subject of the sale.
fixed by the parties. • The price for the sale of the subject property
is also uncertain. Other than her bare
Effect of non-payment of price testimonies, petitioner's claim that she
Non-payment of price does not cancel or extended financial aid to Natividad was not
avoid the sale, as the sale is still considered supported by corroborating evidence.
perfected. But it is a cause for either: Although the litigation expenses spent by
a. Specific performance or petitioner form part of the purchase price of
b. Rescission. the subject property, no receipt of expenses
was presented by petitioner which would aid
Effect of Inadequacy of Price this Court to determine the exact amount
thereof. This undetermined amount of
General Rule: Mere inadequacy of the price
expenses all the more renders the price or
does not affect the validity of the sale.
consideration of the sale ambiguous.
XPN:
1. Fraud, mistake, or undue influence ARAKOR CONSTRUCTION AND DEVT.
indicative of a defect in consent CORP. V. STA. MARIA
2. Parties really intended a donation or G.R. No. 215006, January 11, 2021
some other act or contract J. Hernando
3. In Judicial Sale, where the inadequacy Facts:
is shocking to the conscience of man. Ruling:
• Case law provides that "forgery cannot be
Effect where price is simulated presumed and must be proved by clear,
• Absolutely simulated – the sale is void positive and convincing evidence by the party
alleging the same." In this case, the Gaddis
• False Price – the ostensible contract
satisfactorily discharged this burden by
• Where the deed of sale states that the
submitting in evidence the Certificate of
purchase price has been paid but in fact Death of Felicidad to prove that her demise
has never been paid, the deed of sale is preceded the execution of the contracts of
null and void ab initio for lack of sale. This is in addition to Arakor's admission
consideration. Moreover, Art. 1471 of the that Felicidad's death occurred before the
Civil Code, provides that “if the price is sale transpired. Obviously, she could not
simulated, the sale is void” (Catindig v. have signed any document which leads to no
Vda. De Meneses, Roxas v. CA, G.R. No. other conclusion than that her signatures in
165851, February 2, 2011) the deeds were forged.
• More importantly, "if any one party to a 3. When sales are effected through electronic
supposed contract was already dead at the commerce .
time of its execution, such contract is
undoubtedly simulated and false, and, Public instrument is not required for validity
therefore, null and void by reason of its of Sale of a piece of land
having been made after the death of the party The provision of Article 1358 of the Civil Code on
who appears as one of the contracting parties the necessity of a public document is only for
therein." Indeed, "no one can give what one convenience, not for validity or enforceability. It is
does not have; nemo dat quod non habet. not a requirement for the validity of the contract of
One can sell only what one owns or is sale of a parcel of land that this be embodied in a
authorized to sell, and the buyer can acquire public instrument. Thus, the non-appearance of
no more right than what the seller can transfer the parties before the notary public who notarized
legally." Considering that Felicidad's the deed does not necessarily nullify nor render
signatures were forged, the Deeds of the parties’ transaction void ab initio. (Penalosa
Absolute Sale are null and void and convey vs. Santos, 363 SCRA 545)
no title to Arakor. Thus, the TCTs which were
issued in favor of Arakor "by virtue of the said Note: Statute of Frauds that requires the sale of
spurious and forged document are also null land or any interest therein to be in writing for
and void." In fact, "all the transactions enforceability.
subsequent to the alleged sale are likewise • If sale is already enforceable due to doctrine of
void.“ part performance (Statute of Frauds only
applies to executory contracts), the remedy is
under Article 1357 of the Civil Code;
THREE STAGES
• right to compel the other to execute the proper
1. Negotiation – covers the period when
public instrument so that a valid contract can
parties indicate their interest but no
be registered; this applies to cases where
concurrence of offer and acceptance.
contract is valid and enforceable, but specific
2. Perfection – meeting of the minds upon the
form (public instrument) is required for
object and price.
convenience (registration).
3. Consummation – parties perform their
respective undertakings. BAR QUESTION (1988)
One-half of a parcel of land belonging to A and B
STATUTE OF FRAUDS | ART. 1403 (2)
was sold by X to Y for the amount of P1,500.00.
While contract of sale is consensual, the Statute
The sale was executed verbally. One year later,
of Frauds requires certain sales transaction to
A and B sold the entire land to X. Is the sale
be in writing or evidenced by some note or executed verbally by X to Y valid and binding?
memorandum, and subscribed by the party Reasons
charged, or by his agent to be enforceable:
a) An agreement that by its terms is not to be SUGGESTED ANSWER
performed within a year from the making The sale, although not contained in a public
thereof; instrument or formal writing, is nevertheless valid
b) An agreement for the sale of goods, chattels and binding for the time-honored rule is that even
or things in action, at a price not less than five a verbal contract of sale of real estate produces
hundred pesos, unless the buyer accept and legal effects between the parties. In the premises,
receive part of such goods and chattels, or Art. 1434 of the Civil Code, which declares that
the evidences, or some of them, of such when a person who is not the owner of a thing
things in action or pay at the time some part sells or alienates and delivers it, and later the
of the purchase money; but when a sale is seller or grantor acquires title thereto, such title
made by auction and entry is made by the passes by operation of law to the buyer or
auctioneer in his sales book, at the time of the grantee, is applicable, (Bucton vs. Gabar, 55
sale, of the amount and kind of property sold, SCRA 499.)
terms of sale, price, names of the purchasers
and person on whose account the sale is B. CONTRACT OF SALE
made, it is a sufficient memorandum; and,
c) An agreement for the sale of real property or
of an interest therein. 1. CONTRACT TO SELL
A contract to sell may be defined as a bilateral
XPN: contract whereby the prospective seller, while
1. There has been partial expressly reserving the ownership of the subject
performance/execution property despite delivery thereof to the
2. There has been failure to object to prospective buyer, binds himself to sell the said
presentation of evidence aliunde as to the property exclusively to the prospective buyer
existence of a contract without being in upon fulfillment of the condition agreed upon,
writing and which is covered by the Statute that is, full payment of the purchase price.
of Fraud.
CORONEL VS. COURT OF APPEALS 2. OPTION CONTRACT

263 SCRA 15, October 07, 1996 An accepted unilateral promise to buy or to sell
• A contract to sell may not be considered as a a determinate thing for a price certain is binding
contract of sale because the first essential upon the promisor if the promise is supported
element (Consent or meeting of the minds, by a consideration distinct from the price. (Art.
that is, consent to transfer ownership in 1479, NCC)
exchange for the price) is lacking.
• In a contract to sell, the prospective seller SPS. LITONJUA VS. L&R CORPORATION
explicitly reserves the transfer of title to the G.R. No. 130722, March 27, 2000
prospective buyer, meaning, the prospective An accepted unilateral promise which specifies
seller does not as yet agree or consent to the thing to be sold and the price to be paid,
transfer ownership of the property subject of when coupled with a valuable consideration
the contract to sell until the happening of an distinct and separate from the price, is what
event, which for present purposes we shall may properly be termed a perfected contract of
take as the full payment of the purchase option. This contract is legally binding, and in
price.
sales, it conforms with the second paragraph of
• What the seller agrees or obliges himself to
Article 1479.
do is to fulfill his promise to sell the subject
property when the entire amount of the
Observe, however, that the option is not the
purchase price is delivered to him. In other
contract of sale itself. The optionee has the
words, the full payment of the purchase price
partakes of a suspensive condition, the non-
right, but not the obligation, to buy. Once the
fulfillment of which prevents the obligation to option is exercised timely, i.e., the offer is
sell from arising and thus, ownership is accepted before a breach of the option, a
retained by the prospective seller without bilateral promise to sell and to buy ensues and
further remedies by the prospective buyer. both parties are then reciprocally bound to
comply with their respective undertakings.
CONTRACT TO SELL v. CONTRACT OF
SALE A negotiation is formally initiated by an offer. An
imperfect promise (policitacion) is merely an
CONTRACT TO SELL CONTRACT OF SALE offer. Public advertisements or solicitations and
the like are ordinarily, construed as mere
The ownership is The title passes to the invitations to make offers or only as proposals.
reserved to the seller buyer upon the delivery These relations, until a contract is perfected,
and is not to pass until of the thing sold. are not considered binding commitments. Thus,
full payment of the at any time prior to the perfection of the
price. contract, either negotiating party may stop the
negotiation. The offer, at this stage, may be
The title remains in the The vendor has lost withdrawn; the withdrawal is effective
vendor if the vendee and cannot recover the immediately after its manifestation, such as by
does not comply with ownership of the thing its mailing and not necessarily when the offeree
the condition precedent sold until and unless learns of the withdrawal.
of making payment at the contract of sale
Where a PERIOD is given to the offeree within
the time specified in the itself is resolved and
which to accept the offer, the following rules
contract. set aside. generally govern.
In case of non-payment In case of non-payment 1) If the period is not itself founded upon or
supported by a consideration, the offeror is
of price, there can be of price, an action for
still free and has the right to withdraw the
no action for specific specific performance or offer before its acceptance, or, if an
performance but only for rescission can be acceptance has been made, before the
for damages. filed by injured party. offeror's coming to know of such fact, by
communicating that withdrawal to the
Failure to fully pay the offeree. The right to withdraw, however,
price is not a breach must not be exercised whimsically or
but an event that arbitrarily; otherwise, it could give rise to a
prevents the obligation damage claim under Article 19 of the Civil
of the vendor to convey Code which ordains that "every person
title from becoming must, in the exercise of his rights and in the
effective. performance of his duties, act with justice,
give everyone his due, and observe
honesty and good faith.
2) If the period has a separate consideration, BAR QUESTION (1996)

a contract of "option" is deemed
perfected, and it would be a breach of that Ubaldo is the owner of a building which has
contract to withdraw the offer during the been leased by Remigio for the past 20 years.
agreed period. The option, however, is an Ubaldo has repeatedly assured Remigio that if
independent contract by itself, and it is to he should decide to sell the building, he will
be distinguished from the projected main give Remigio the right of first refusal. On June
30, 1994, Ubaldo informed Remigio that he
agreement (subject matter of the option)
was willing to sell the building for P5 Million.
which is obviously yet to be concluded. If,
The following day, Remigio sent a letter to
in fact, the optioner-offeror withdraws the
Ubaldo offering to buy the building at P4.5
offer before its acceptance (exercise of Million. Ubaldo did not reply. One week later,
the option) by the optionee-offeree, the Remigio received a letter from Santos
latter may not sue for specific informing him that the building has been sold to
performance on the proposed contract him by Ubaldo for P5 Million, and that he will
("object" of the option) since it has failed not renew Remigio's lease when it expires.
to reach its own stage of perfection. The Remigio filed an action against Ubaldo and
optioner-offeror, however, renders himself Santos for cancellation of the sale, and to
liable for damages for breach of the compel Ubaldo to execute a deed of absolute
option. sale in his favor, based on his right of first
refusal.
3. RIGHT OF FIRST REFUSAL Will the action prosper? Explain.
• It is a contractual grant, not for the sale of If Ubaldo had given Remigio an option to
a property, but for the first priority to buy purchase the building instead of a right of first
the property in the event the owner decides refusal, will your answer be the same? Explain.
to sell the same. SUGGESTED ANSWER
• It is based on the current offer to sell of the
seller or offer to purchase of any (a) No, the action to compel Ubaldo to execute
the deed of absolute sale will not prosper. The
prospective buyer. Only after the optionee
right of first refusal implies that the offer of the
fails to exercise its right of first priority
person in whose favor that right was given
under the same terms and within the
must conform with the same terms and
period contemplated could the owner conditions as those given to the offeree. In this
validly offer to sell the property to a third case, however, Remigio was offering only P4.5
person, again, under the same terms as Million instead of P5 Million.
offered to the optionee (Paranaque Kings
Enterprises, Inc. v. CA, G.R. No. 111538, (b) Yes, the answer will be the same. The
February 26, 1997). action will not prosper because an option must
be supported by a consideration separate and
RIVIERA FILIPINA, INC. vs. CA distinct from the purchase price. In this case
G.R. No. 117355 - April 5, 2002 there is no separate consideration. Therefore,
• In order to have full compliance with the the option may be withdrawn by Ubaldo at any
contractual right granting petitioner the first time. (Art. 1324, NCC)
option to purchase, the sale of the
properties for the price for which they were C. EARNEST MONEY
finally sold to a third person should have
likewise been first offered to the former.
‘Earnest Money’ defined
Further, there should be identity of terms
• Earnest money is something of value
and conditions to be offered to the buyer
holding a right of first refusal if such right is
given by the buyer to the seller to show
not to be rendered illusory. Lastly, the that the buyer is really in earnest, and to
basis of the right of first refusal must be the bind the bargain.
current offer to sell of the seller or offer to • It is actually a partial payment of the
purchase of any prospective buyer. purchase price and is considered as proof
• Thus, the prevailing doctrine is that a right of the perfection of the contract.
of first refusal means identity of terms and
conditions to be offered to the lessee and Art. 1482. Whenever earnest money is
all other prospective buyers and a contract given in a contract of sale, it shall be
of sale entered into in violation of a right of considered as part of the price and as proof
first refusal of another person, while valid, of the perfection of the contract.
is rescissible.
RIZALINO V. PARAISO DEVELOPMENT

CORPORATION OPTION MONEY EARNEST MONEY
G.R. No. 157493, February 5, 2007 - Separate and - Partial payment
Earnest Money and Option Money distinct and part of the
Distinguished From Each Other consideration purchase price
"Earnest money" and "option money" are not from the
the same but distinguished thus: purchase price - Given only when
(a) earnest money is part of the purchase there is a
price, while option money is the money - Sale is not yet perfected sale
given as a distinct consideration for an perfected
option contract; - Buyer is bound
(b) earnest money is given only where there - The would-be- to pay the
is already a sale, while option money buyer is not balance of the
applies to a sale not yet perfected; and, required to buy price
(c) when earnest money is given, the buyer is
bound to pay the balance, while when the D. DOUBLE SALES
would-be buyer gives option money, he is
not required to buy, but may even forfeit it ‘Double Sales’ defined
depending on the terms of the option. • When the same object of the sale is sold to
• Earnest money, under Article 1482 of the different vendees.
Civil Code, is ordinarily given in a perfected • Governed by Article 1544 of the Civil Code.
contract of sale. However, earnest money
may also be given in a contract to sell. Art. 1544. If the same thing should have been
• In a contract to sell, earnest money is sold to different vendees, the ownership shall be
generally intended to compensate the seller transferred to the person who may have first
for the opportunity cost of not looking for any taken possession thereof in good faith, if it should
other buyers. It is a show of commitment on be movable property.
the part of the party who intimates his or her
willingness to go through with the sale after Should it be immovable property, the ownership
a specified period or upon compliance with shall belong to the person acquiring it who in
the conditions stated in the contract to sell. good faith first recorded it in the Registry of
• Opportunity cost is defined as "the cost of Property.
the foregone alternative." In a potential sale,
Should there be no inscription, the ownership
the seller reserves the property for a
shall pertain to the person who in good faith was
potential buyer and foregoes the alternative
first in the possession; and, in the absence
of searching for other offers.
thereof, to the person who presents the oldest
• This Court, in Philippine National Bank v. title, provided there is good faith.
Court of Appeals, construed earnest money
given in a contract to sell as "consideration Requisites:
for [seller's] promise to reserve the subject a. 2 or more sales transactions must constitute
property for [the buyer]." The seller, "in valid sales transactions;
excluding all other prospective buyers from b. 2 or more sales transactions must pertain to
bidding for the subject property ... [has exactly the same subject matter;
given] up what may have been more c. 2 or more buyers at odds over the rightful
lucrative offers or better deals.” ownership of the subject matter must each
• Earnest money, therefore, is paid for the represent conflicting interests; and
seller's benefit. It is part of the purchase d. 2 or more buyers at odds over the rightful
price while at the same time proof of ownership of the subject matter must have
commitment by the potential buyer. Absent bought from the very same seller.
proof of a clear agreement to the contrary, it
is intended to be forfeited if the sale does not CHENG V. GENATO
happen without the seller's fault. For this G.R. No. 129760, December 29, 1998
reason, the Court, in Racelis v. Javier, ruled Requisites of Double Sale
that "[t]here is no unjust enrichment on the • The two (or more) sales transactions in the
part of the seller should the initial payment issue must pertain to exactly the same subject
matter, and must be valid sales transactions.
be deemed forfeited. After all, the owner
• The two (or more) buyers at odds over the
could have found other offers or a better
rightful ownership of the subject matter must
deal. The earnest money given by
each represent conflicting interests; and
respondents is the cost of holding this
• The two (or more) buyers at odds over the
search in abeyance." rightful ownership of the subject matter must
each have bought from the very same seller.
EFFECT OF DOUBLE SALE E. RISK OF LOSS

1. Movable – Owner who is first to possess in
good faith shall be preferred
RES PERIT DOMINO
2. Immovable
• The owner bears the loss
a.First to register in good faith
• When the loss occurred before perfection of
b.No registration – first to possess in good
sale, the thing perishes with the owner – Res
faith
perit domino (NCC, Art. 1504)
c. No registration & no possession in good
• When the loss occurred after perfection but
faith – person who presents oldest title in
before delivery, the risk of loss is borne by
good faith
Note: Art. 1544 of the Civil Code has no the seller because it is delivery that transfers
application to lands not registered with the ownership except contrary stipulation in the
Torrens system. If the sale is not registered, it is contract.
binding only as between the seller and the • When the loss occurred after delivery, the
buyer, it does not affect innocent third persons. buyer bears the risk of the loss (Res perit
Further, this does not also apply to contract to domino)
sell.
Article 1504. Unless otherwise agreed, the
’Purchaser in Good Faith’ defined goods remain at the seller’s risk until the
• One who buys the property without notice that ownership therein is transferred to the buyer.
some other person has a right to, or interest But when ownership therein is transferred to
in such property; and pays a full and fair price the buyer, the goods are at the buyer’s risk
for the same at the time of such purchase, or whether actual delivery has been made or not,
before he has notice of the claim or interest of except that:
some other person in the property (1) Where delivery of the goods has been
made to the buyer or to a bailee for the
Note: PRIOR TEMPORE, POTIOR JURE - This buyer, in pursuance of the contract and
principle applies in a situation where Art. 1544 is the ownership in the goods has been
inapplicable due to absence of requisite/s. retained by the seller merely to secure
performance by the buyer of his
Requisite: obligations under the contract, the goods
The only requisite of this rule is priority in time. are at the buyer's risk from the time of
The only one who can invoke this is the first such delivery;
vendee. (2) Where actual delivery has been delayed
through the fault of either the buyer or
BAR QUESTION (2001)
seller the goods are at the risk of the party
On June 15, 1995, Jesus sold a parcel of in fault.
registered land to Jaime. On June 30, 1995, he
sold the same land to Jose. Who has a better GAISANO CAGAYAN, INC. V. INSURANCE
right if: COMPANY OF NORTH AMERICA
a. the first sale is registered ahead of the G.R. No. 147839, June 8, 2006
second sale, with knowledge of the latter. Facts:
Why?; • Intercapitol Marketing Corporation (IMC) is
b. the second sale is registered ahead of the the maker of Wrangler Blue Jeans. Levi
first sale, with knowledge of the latter? Why?
Strauss (Phils.) Inc. (LSPI) is the local
SUGGESTED ANSWER distributor of products bearing trademarks
owned by Levi Strauss & Co.. IMC and LSPI
(a) The first buyer has the better right if his sale
separately obtained from respondent fire
was first to be registered, even though the first
buyer knew of the second sale. The fact that he
insurance policies with book debt
knew of the second sale at the time of his endorsements.
registration does not make him as acting in bad • Petitioner is a customer and dealer of the
faith because the sale to him was ahead in time, products of IMC and LSPI.
hence, has a priority in right. What creates bad • On February 25, 1991, the Gaisano
faith in the case of double sale of land is Superstore Complex in Cagayan de Oro
knowledge of a previous sale. City, owned by petitioner, was consumed by
fire. Included in the items lost or destroyed in
b) The first buyer is still to be preferred, where the fire were stocks of ready-made clothing
the second sale is registered ahead of the first materials sold and delivered by IMC and
sale but with knowledge of the latter. This is LSPI.
because the second buyer, who at the time he
registered his sale knew that the property had Issue:
already been sold to someone else, acted in bad
WoN Petitioner bears the risk of loss.
faith. (Article 1544, NCC)
Ruling:
BAR QUESTION (1999)
Petitioner argues that IMC bears the risk of loss
because it expressly reserved ownership of the A granted B the exclusive right to sell his
goods by stipulating in the sales invoices that brand of Maong pants in Isabela, the price
"[i]t is further agreed that merely for purpose of for his merchandise payable within 60 days
securing the payment of the purchase price the from delivery, and promising B a commission
above described merchandise remains the of 20% on all sales. After the delivery of the
property of the vendor until the purchase price merchandise to B but before he could sell
thereof is fully paid.” any of them, B’s store in Isabela was
completely burned without his fault, together
The present case clearly falls under paragraph
with all of A's pants.
(1), Article 1504 of the Civil Code. xxx Thus,
Must B pay A for his lost pants? Why?
when the seller retains ownership only to insure
that the buyer will pay its debt, the risk of loss is SUGGESTED ANSWER
borne by the buyer. Accordingly, petitioner bears
the risk of loss of the goods delivered. The contract between A and B is a sale not
an agency to sell because the price is
The rationale for this is that the rule that an payable by B upon 60 days from delivery
obligor should be held exempt from liability when even if B is unable to resell it.
the loss occurs thru a fortuitous event only holds As a buyer, ownership passed to B upon
true when the obligation consists in the delivery delivery and, under Art. 1504 of the Civil
of a determinate thing and there is no stipulation Code, the thing perishes for the owner.
holding him liable even in case of fortuitous Hence, B must still pay the price.
event. It does not apply when the obligation is
pecuniary in nature. BAR QUESTION (1981)
Under Article 1263 of the Civil Code, "[i]n an "S", an American resident of Manila, about to
obligation to deliver a generic thing, the loss or leave on a vacation, sold his car to "B" for
destruction of anything of the same kind does U.S. $2,000.00, the payment to be made ten
not extinguish the obligation." If the obligation is days after delivery to "X", a third party
generic in the sense that the object thereof is depositary agreed upon, who shall deliver the
designated merely by its class or genus without car to "B" upon receipt by "X" of the
any particular designation or physical purchase price. It was stipulated that
segregation from all others of the same class, ownership is retained by "S" until delivery of
the loss or destruction of anything of the same the car to "X".
kind even without the debtor's fault and before Five days after delivery of the car to "X", it
he has incurred in delay will not have the effect was destroyed in a fire which gutted the
of extinguishing the obligation. This rule is based house of "X", without the fault of either "X" or
on the principle that the genus of a thing can "B". Is buyer "B" still legally obligated to pay
never perish. Genus nunquan perit. An the purchase price? Explain.
obligation to pay money is generic; therefore, it
is not excused by fortuitous loss of any specific SUGGESTED ANSWER
property of the debtor.
"B" is still legally obligated to pay the
Lost in part only
purchase price. It must be observed that "S"
The vendee may choose between withdrawing had already delivered the car to "X", the third
from the contract and demanding the remaining party depositary or bailee. It was agreed that
part, paying its price in proportion to the total ownership is retained by "S" until delivery to
sum agreed upon "X". Therefore, in effect, there was already a
transfer of the right of ownership over the car
Specific Goods to "B". Consequently, "B" shall assume the
Where the parties purport a sale of specific fortuitous loss of the car. As a matter of fact,
goods, and the goods without the knowledge of even if it was agreed that "S" shall retain the
the seller have perished in part or have wholly or ownership of the car until the purchase price
in a material part so deteriorated in quality as to has been paid by "B", the end result will still
be substantially changed in character, the buyer be the same. Since eventually, the purpose
may at his option treat the sale: is to secure performance by the buyer of his
1. As avoided; or obligation to pay the purchase price, by
2. As valid in all of the existing goods or in so express mandate of the law, the fortuitous
much thereof as have not deteriorated, and loss of the car shall be assumed by "B".
as binding the buyer to pay the agreed (Note: The above answer is based on Art.
price for the goods in which the ownership 1504 of the Civil Code.)
will pass, if the sale was divisible.
F. BREACH OF CONTRACT OF Instance when the Seller may maintain an

Action for Damages
SALE
The buyer wrongfully neglects or refuses to
accept and pay for the goods
Who is Liable in Breach of Contracts?
Those who are guilty of fraud, negligence, or
delay, and those who in any manner contravene UNPAID SELLER
the tenor in the performance of their obligations, The seller of goods is deemed to be an unpaid
are liable for damages. [Article 1170] seller when:
1. The whole of the price has not been paid or
The vendor has the obligation to: tendered.
1. Transfer ownership of the thing sold 2. A bill of exchange or other negotiable
2. Deliver the thing including accessions and instrument has been received as
accessories conditional payment, and the condition on
3. Warrant the thing against eviction and hidden which it was received has been broken by
defects reason of the dishonor of the instrument,
4. Take care of the thing pending delivery the insolvency of the buyer, or otherwise.
5. Pay for the expenses, unless otherwise
stipulated REMEDIES OF UNPAID SELLER
a. Possessory lien
The vendee has the obligation to: • Seller not bound to deliver object of the
1. Accept the delivery contract of sale if buyer has not paid him the
2. Pay the price price.
3. To take care of the goods, where the goods • This is a lien on the goods, or the right to
are delivered to the buyer and he rightfully retain them for the price while he is in
refuses to accept (NCC, Art. 1587) possession of them.
4. To be liable as a depositary if he voluntarily • Instances:
constituted himself as such (NCC, Art. 1587)  When the goods sold without
5. To pay interest for the period between stipulation as to credit.
delivery of the thing and the payment of the  Goods sold on credit, but term of credit
price in the following cases (NCC, Art. 1589): has expired.
a. Should it had been stipulated  Buyer becomes insolvent. (Art 1527)
b. Should the thing sold and delivered
produces fruits or income; or b. Stoppage in Transitu
c. Should he be in default from the time of • It is a right which the seller of goods on
judicial or extra-judicial demand for the credit has to recall them or retake them
payment of the price. while they are in the possession of a carrier
or other middleman who received them for
Remedies from the nature of the contract of
delivery to the buyer, on discovery of
sale
insolvency of the buyer. (Art 1530)
• Specific performance
• Requisites:
• Rescission
a. Unpaid seller
• Damages
b. Title of goods must have passed to the
Prescriptive periods buyer;
• Oral: 6 years c. Goods must be in transit
• Written: 10 years d. Insolvent buyer
e. Seller must either actually take
Instances when the Seller may maintain an possession of the goods sold or give
Action for the Price notice of his claim to the carrier or other
• The ownership of the goods has passed to person in possession;
the buyer and he wrongfully neglects or
refuses to pay for the goods according to the c. Special right of resale
terms of the contract of sale • Unpaid seller may exercise this right if he
• The price is payable on a certain day, has a right of lien or he has stopped the
irrespective of delivery or of transfer of title goods in transitu in the following authorized
and the buyer wrongfully neglects or refuses causes:
to pay such price a. Goods are perishable;
• The goods cannot readily be resold for a b. Stipulated the right of resale in case of
reasonable price, and the buyer wrongfully default, or
refuses to accept the goods, whether or not c. Buyer in default for unreasonable time.
ownership has passed. (Art 1533)
d. Special right to rescind ATIENZA V. GOLDEN RAM ENGINEERING

• Unpaid seller may exercise having the right SUPPLIES & EQUIPMENT CORP.
of lien or he has stopped the goods in G.R. No. 205405, June 28, 2021
transitu may rescind the transfer of title and J. Hernando
resume ownership in the following cases: Facts:
a. Seller expressly reserved right to • Eduardo Atienza was engaged in the
rescind in case of buyer’s default; business of operating MV Ace I, a
b. Buyer’s default for an unreasonable passenger vessel plying the Batangas-
length of time (Art 1597) Mindoro route. Golden Ram Engineering
Supplies and Equipment Corporation
REMEDIES OF BUYER IN CONTRACT OF
[GRESEC] is a dealer and distributor of
SALE
engines and heavy equipment, while
1. Failure of seller to deliver – Action for
Bartolome Torres is its President.
specific performance; Rescission.
2. Breach of seller’s warranty – buyer • On 24 August 1993, Atienza bought the
may avail of the ff remedies: two vessel engines from GRESEC with
i. Accept goods & set breach of the warranty period of 12 months. The
warranty by recoupment in diminution warranty period is further limited to 2000
of price; hours of operation. Atienza forthwith paid
ii. Accept goods & maintain action on the amount of P2.5 Million Pesos.
damages; • On 26 September 1994, the engine on the
iii. Rescind contract of sale & maintain right side of MV Ace I suffered a major
action on damages. dysfunction. Atienza immediately reported
3. Disturbed in possession or with the incident to GRESEC which sent
reasonable grounds to fear Engineer Torres to inspect and determine
disturbance – Suspend payment. the extent of the damage. Engr. Torres
4. See Maceda and Recto Laws for sales confirmed that the "defect was inherent
with price payable in installment being attributable to factory defect". This
was reported to MAN B&W Diesel,
WARRANTY Singapore Pte. Ltd., the foreign supplier.
Warranties deemed included in all In turn, the latter promised that the engine
contracts of sale by operation of law (NCC, which suffered the malfunction would be
Art. 1547) replaced in accordance with the warranty.
• Warranty that seller has right to sell
• Thereafter, Atienza made pleas for the
• Warranty against eviction
replacement of the engine but his
• Warranty against non-apparent burden or
entreaties fell on deaf ears. Inevitably, he
servitude
suffered losses for failure to operate since
• Warranty against hidden defects
26 September 1994.
Article 1547, NCC. In a contract of sale, • On 28 October 1994, Atienza wrote a
unless a contrary intention appears, there is Demand Letter to either replace the
an implied warranty on the part of the seller engine or reimburse him for the losses he
that he has the right to sell the thing at the had incurred, or retrieve the two engines
time when the ownership is to pass, and that and refund the cost with interest plus
the buyer shall from that time have and enjoy payment for losses. However, GRESEC
the legal and peaceful possession of the thing. paid no heed to his demand.
• In GRESEC’s Answer, they admitted the
One which is unknown or could not have breakdown of the engine but confuted
been known to the buyer Atienza's assertion that Engr. Torres had
The seller shall be responsible for warranty confirmed that "defect was inherent being
only when: attributable to factory defect".
1. The nature of the hidden defect is such Contrariwise, they claimed that the cause
that it should render the subject matter of the damage to the engine was
unfit for the use for which intended; or improper maintenance on the part of
2. Should diminish its fitness for such use Atienza.
to such extent that had the buyer been
aware thereof, he would not have Issue:
acquired it or would have given a lower
WoN Bartolome and GRESEC are solidarity
price for it.
liable for damages?
Ruling: Consistent with the foregoing principles, we

A warranty is a statement or representation disagree with the CA's pronouncement
made by the seller of goods, contemporaneously absolving respondent Bartolome from liability to
and as part of the contract of sale, having the damages incurred by Atienza. Atienza
reference to the character, quality or title of the established sufficient and specific evidence to
goods, and by which he promises to insure that show that Bartolome had acted in bad faith or
certain facts are or shall be as he represents gross negligence in the sale of the defective
them to be. vessel engine and the delivery and installation of
demo units instead of a new engine which
xxxIn the absence of an express stipulation Atienza paid for.
between the parties, the applicable provision is
paragraph 2, Article 1547 of the Civil Code REMEDY OF RESCISSION IN CONTRACT OF
which states that in a contract of sale there is an SALE
implied warranty that the thing shall be free from 1. Art. 1591. Should the vendor have
hidden defects. A hidden defect is one which is
reasonable grounds to fear the loss of
unknown or could not have been known to the
vendee. immovable property sold and its price, he
may immediately sue for the rescission of
Corollarily, Articles 1561 and 1566 of the same the sale. Should such ground not exist, the
Code set forth the responsibility of the vendor provisions of Article 1191 shall be observed.
against hidden defects: 2. Art. 1592. In the sale of immovable
property, even though it may have been
Art. 1561. The vendor shall be responsible for
stipulated that upon failure to pay the price at
warranty against the hidden defects which the
thing sold may have, should they render it unfit the time agreed upon the rescission of the
for the use for which it is intended, or should contract shall of right take place, the vendee
they diminish its fitness for such use to such an may pay, even after the expiration of the
extent that, had the vendee been aware thereof, period, as long as no demand for
he would not have acquired it or would have rescission of the contract has been made
given a lower price for it; but said vendor shall upon him either judicially or by a notarial
not be answerable for patent defects or those
act. After the demand, the court may not
which may be visible, or for those which are not
visible if the vendee Is an expert who, by reason grant him a new term.
of his trade or profession, should have known 3. Art. 1593. With respect to movable property,
them. the rescission of the sale shall of right take
place in the interest of the vendor, if the
Art. 1566. The vendor is responsible to the vendee, upon the expiration of the period
vendee for any hidden faults or defects in the
fixed for the delivery of the thing, should not
thing sold, even though he was not aware
thereof. This provision shall not apply if the have appeared to receive it, or, having
contrary has been stipulated, and the vendor appeared, he should not have tendered the
was not aware of the hidden faults or defects in price at the same time, unless a longer
the thing sold. xxx period has been stipulated for its payment.
In Tramat Mercantile v. Court of Appeals, we BAR QUESTION (2003)

ruled that personal liability of a corporate
director, trustee or officer along (although not X sold a parcel of land to Y on 01
necessarily) with the corporation may so validly January 2002, payment and delivery
attach, as a rule, only when:
1. He assents (a) to a patently unlawful act of to be made on 01 February 2002. It
the corporation, or (b) for bad faith or gross was stipulated that if payment were
negligence in directing its affairs, or (c) for not to be made by Y on 01 February
conflict of interest, resulting in damages to
the corporation, its stockholders or other
2002, the sale between the parties
persons; would automatically be rescinded. Y
2. He consents to the issuance of watered failed to pay on 01 February 2002,
stocks or who, having knowledge thereof, but offered to pay three days later,
does not forthwith file with the corporate
secretary his written objection thereto; which payment X refused to accept,
3. He agrees to hold himself personally and claiming that their contract of sale
solidarity liable with the corporation; or had already been rescinded. Is X’s
4. He is made, by a specific provision of law, to contention correct? Why?
personally answer for his corporate action.
SUGGESTED ANSWER 2. MACEDA LAW

Republic Act No. 6552 or also known as
No, X is not correct. In the sale of immovable Realty Installment Buyer Act.
property, even though it may have been Legislation written by Ernesto Maceda and was
stipulated, as in this case, that upon failure to approved on August 26, 1972.
pay the price at the time agreed upon the
rescission of the contract shall of right take Purpose of the Law
place, the vendee may pay, even after the To protect property owners from unfavorable
expiration of the period, as long as no demand terms that may occur from sale transactions
for rescission of the contract has been made funded by an installment agreement by
upon him either judicially or by a notarial act describing the rights of the buyers regarding
(Article 1592, New Civil code). Since no refund entitlement and grace periods.
demand for rescission was made on Y, either
judicially or by a notarial act, X cannot refuse to Transactions Covered
accept the payment offered by Y three (3) days • All transactions or contracts involving the sale
after the expiration of the period. or financing of real estate on installment
payments, including residential condominium
1. RECTO LAW apartments [Sec. 3, Maceda Law]
Recto Law (Sale of Personal Property in
Installment) Exclusions to Coverage
This covers contracts of sale of personal • Industrial Lots
property by installment (Act No. 4122). It is also • Commercial Buildings
applied to contracts purporting to be leases of • Sales to tenants under R.A. No. 3844, as
personal property with option to buy, when the amended by R.A. No. 6389.
lessor has deprived the lessee of the possession
Features of Maceda Law
or enjoyment of the thing (PCI Leasing and
1. After paying installment for at least 2 years,
Finance Inc. v. Giraffe- X Creative Imaging, Inc.
buyer is entitled to a mandatory grace period
G.R. No. 142618, July 12, 2007)
of 1 month for every year of installment to
• Note: Recto law applies only to sale payable
pay unpaid installment without interest
in installments and not to sale where there is
2. In case installments paid were less than 2
an initial payment and the balance is payable
years, seller shall give buyer a grace period
in the future, because such is a straight sale,
of not less than 60 days.
not a sale by installments.
3. If buyer fails to pay at expiration of grace
period, seller may cancel contract after 30
Alternative remedies of the Seller:
days from notice of cancellation through
• Specific performance – Exact fulfillment
Notarial Notice of Cancellation. (Rillo v. CA,
should the buyer fail to pay. If availed, the
G.R. No. 125347, June 19, 1997).
unpaid seller cannot anymore choose other
4. After the lapse of the grace period, seller may
remedies.
cancel the contract provided he pays the
• Rescission – Cancel the sale if buyer fails to
buyer the CASH SURRENDER VALUE
pay 2 or more installments.
which is equivalent to 50% of all payments,
• Foreclosure on chattel mortgage if buyer fails
and after five years of installment an
to pay 2 or more installments. He shall have additional 5% for every year but not to
no further action against the purchaser to exceed 90% of total payments made.
recover any unpaid balance of the price. Any 5. The cancellation of the contract takes effect
agreement to the contrary shall be void. 30 days from service of notarial notice of
cancellation and upon payment of the cash
Effect of filing a case for specific surrender value
performance
• The seller can collect from the buyer for the General Rule: Stipulation in any contract which
sum of money the buyer failed to pay. In case is contrary to the provisions of Maceda Law shall
the sum collected is insufficient, the court can be declared null and void. [Sec. 7, Maceda Law]
still order for the levy of the property subject
of the sale transaction to cover the balance. Other Rights of Buyer
• Moreover, if the action instituted is for specific 1. The buyer shall have the right to sell his rights
performance and the mortgaged property is or assign the same to another person. [Sec. 5,
subsequently attached and sold, the sale Maceda Law]
thereof does not amount to a foreclosure of 2. The buyer shall have the right to reinstate the
the mortgage; the seller-creditor is entitled to contract by updating the account during the
a deficiency judgment (Industrial Finance grace period and before actual cancellation of
Corp v. Ramirez, G.R. No. L-43821, May 26, the contract. [Sec. 5, Maceda Law]. The deed
1977) of sale or assignment shall be done by notarial
act.
3. The buyer shall have the right to pay in Basic remedies of a defaulting buyer under
advance any installment or the full unpaid Section 6 of RA 6552: Claim refund or pay in
balance of the purchase price any time advance or in full.
without interest and to have such full • It has been held that in the absence of a
payment of the purchase price annotated in lawful rescission of a contract governed by
the certificate of title covering the property. RA 6552, the same remains valid and
[Sec. 6, Maceda Law] subsisting.
• We affirm the courts below in directing the
PRYCE PROPERTIES CORP. V. NOLASCO refund of the deposit payments made by
G.R. No. 203990, August 24, 2020 Nolasco to Pryce. While this buyer's option to
J. Hernando claim refund is not explicitly mentioned in RA
Issues: 6552, equity considerations have already
• WoN the contract between Pryce and filled up this legal vacuum as declared in
Nolasco was rescinded in accordance with Orbe. In the said case, the buyer therein
RA 6552 failed to make at least two years of
• WoN petitioner Pryce should refund installment payments in consideration of a
respondent Nolasco. purchase of a lot. The seller, however, failed
Ruling: to cancel their contract through a valid
Pryce's Answer with Counterclaims cannot be notarial act and sold the lot in issue to a third
deemed as a notarial rescission under RA person. The Court, finding the provisions of
6552. A notarial rescission contemplated under RA 6552 applicable to the transaction,
RA 6552 is a unilateral cancellation by a seller of ordered the refund of the amounts actually
a perfected contract thereunder acknowledged paid by the buyer, justifying the same with
by a notary public and accompanied by equitable reasons as laid out by relevant
competent evidence of identity. This notarial jurisprudence.
notice of rescission has peculiar technical
requirements. We find that Pryce violated all of G. EXTINGUISHMENT OF SALE
them.
In General, sales are extinguished by the same
An act or a deed of rescission is distinct and causes as all other obligations:
separate from an allegation of rescission, an 1. Payment/performance
allegation being an assertion, declaration, or 2. Prescription
statement of a party to an action, contained 3. Loss of thing due
generally in an affidavit or a legal pleading, 4. Condonation/remission
setting out what is yet to be proven. Under 5. Confusion/merger
notarial rules, acknowledgments cover written 6. Compensation
deeds and acts, whereas jurats confirm affidavits 7. Rescission
and pleadings. 8. Annulment
9. Novation
The foregoing thus defined, a deed of rescission 10. Fulfillment of the Resolutory condition
notarized via acknowledgment is already a piece 11. Redemption (Conventional or Legal)
of evidence all on its own. On the other hand, an
allegation of rescission contained in an affidavit 1. CONVENTIONAL REDEMPTION
or a pleading and confirmed by a notarial jurat Conventional redemption shall take place when
still remains to be proved; it merely implies that the vendor reserves the right to repurchase the
the signatory thereof sets out to prove the fact of thing sold, with the obligation to comply with the
the rescission before a notary public. provisions of article 1616 and other stipulations
which may have been agreed upon. (Art 1601,
Here, Pryce only alleged the fact of rescission in NCC)
its Answer with Counterclaims without further
evidence that would adequately determine its Requisites for a Vendor to Avail the Right of
truth. It is not the independent notarial rescission Repurchase
contemplated by RA 6552. Vendor must return to the vendee:
a. The price of the sale
Even if We deem the Answer with b. The expenses of the contract, and any other
Counterclaims as a deed of rescission, jurats will legitimate payments made by reason of the
not suffice for its conversion into a notarial act of sale;
rescission under RA 6552. Having secured a c. The necessary and useful expenses made on
mere jurat to notarize the supposed "notice of the thing sold. [Article 1616]
rescission" as embodied in its Answer with
Counterclaims and verifying the same upon an Period of redemption
incompetent proof of identity, Pryce executed a • When there is a period agreed upon: not to
fatally infirm notarial rescission. exceed 10 years
• No period agreed upon: 4 years.
• Period to redeem expired (+there is a suit on Requisites for Presumption of Equitable

the nature of the contract: 30 Days from final Mortgage to Arise
judgment (Art 1606) a. The parties entered into a contract
denominated as a contract of sale.
Effect if no redemption was made b. The intention of the parties was to secure
Art. 1607. In case of real property, the an existing debt by way of mortgage.
consolidation of ownership in the vendee by
virtue of the failure of the vendor to comply with REPUELA V. ESTATE OF THE SPS.
the provisions of article 1616 shall not be LARAWAN
recorded in the Registry of Property without a G.R. No. 219638. December 07, 2016
judicial order, after the vendor has been duly • There is no single conclusive test to
heard determine whether a deed of sale, absolute
on its face, is really a simple loan
2. LEGAL REDEMPTION accommodation secured by a mortgage.
‘Legal Redemption’ defined • Article 1602, in relation to Article 1604 of the
It is the right to be subrogated, upon the same Civil Code, however, enumerates several
terms and conditions stipulated in the contract, instances when a contract, purporting to be,
in the place of one who acquires a thing by and in fact styled as, an absolute sale, is
purchase or dation in payment, or by any other presumed to be an equitable mortgage.
transaction whereby ownership is transmitted by
onerous title. Cases Wherein The Contract Shall Be
Presumed To Be An Equitable Mortgage
INSTANCES OF LEGAL REDEMPTION 1. When the price of a sale with right to
1. Sale of a co-owner of his share to a stranger repurchase is unusually inadequate;
(NCC, Art. 1620; 2. When the vendor remains in possession as
2. When a credit or other incorporeal right in lessee or otherwise;
litigation is sold (NCC, Art. 1634) 3. When upon or after the expiration of the right
3. Sale of an heir of his hereditary rights to a to repurchase another instrument extending
stranger (NCC, Art. 1088) the period of redemption or granting a new
4. Sale of adjacent rural lands not exceeding 1 period is executed;
hectare (NCC, Art. 1621) 4. When the purchaser retains for himself a part
5. Sale of adjacent small urban lands bought of the purchase price;
merely for speculation (NCC, Art. 1622) 5. When the vendor binds himself to pay the
taxes on the thing sold;
NOTICE REQUIREMENT 6. In any other case where it may be fairly
Art. 1623. The right of legal pre-emption or inferred that the real intention of the parties
redemption shall not be exercised except within is that the transaction shall secure the
thirty days from the notice in writing by the payment of a debt or the performance of any
prospective vendor, or by the vendor, as the other obligation. [Article 1602]
case may be. The deed of sale shall not be
recorded in the Registry of Property, unless Note: In case of doubt, a contract purporting to
accompanied by an affidavit of the vendor that be a sale with right to repurchase and absolute
he has given written notice thereof to all possible sale shall be construed as an equitable
redemptioners. mortgage.
"The right of redemption of co-owners excludes

that of adjoining owners." I. PACTO DE RETRO SALES
Note: Knowledge is insufficient – the mere fact • The title and ownership of the property sold
that the redemptioner is already aware of the is immediately vested in the vendee a retro,
existence of the sale will not excuse the written subject to the restrictive condition of
notice. (Barcellano v. Banas et. al. G.R. No. repurchase by the vendor a retro within the
165287, September 14, 2011) period provided.
H. EQUITABLE MORTGAGE • The payment of the repurchase price does
not merely render the document null and
Equitable Mortgage’ defined void but there is the obligation on the part of
One which, although lacking in some formality, the vendee to sell back the property.
or form, or words, or other requisites demanded • A sale with pacto de retro transfers the
by a statute, reveals the intention of the parties legal title to the vendee and this, in the
to charge real property as security for a debt, absence of an agreement to the contrary,
carries with it the right of possession.
and contains nothing impossible or contrary to
law.
Pacto de retro vs. Equitable mortgage

The action of CD will not prosper. Whether
 In pacto de retro – ownership is
we look at the deed of sale as a true
immediately transferred to the vendee,
contract of sale with right of repurchase or
subject only to the right of the vendor to
a mere contract of equitable mortgage, the
repurchase within a stipulated period.
effect in the instant case will be the same.
 In equitable mortgage – although
If it is a true contract of sale with right of
lacking in the required formality of
repurchase, according to the Civil Code,
mortgage reveals the intention to burden
the vendor may still exercise the right to
a property as security for a debt. Non-
repurchase within thirty days from the time
payment gives right to the creditor to
final judgment was rendered in a civil action
foreclose.
on the basis that the contract was a true
• Nomenclature is not controlling, even
sale with right to repurchase. If it is a mere
if denominated as pacto de retro,
equitable mortgage because of the gross
decisive factor is the intention of the
inadequacy of the purchase, the fact that
parties.
the vendor is still in possession of the
• Pactum Commissorium - A
property, and the fact that AB was in great
stipulation for automatic vesting of title
need of money, the vendor (mortgagor)
over the security in the creditor in case
may still exercise his right to redeem the
of debtor’s default. This is void. The property by paying the mortgage loan plus
proper remedy is foreclosure of the interest prior to foreclosure.
mortgage. If there is no foreclosure,
the debtors retain ownership (Vasquez
v. CA, G.R. No. 144882, February 5,
2005)
BAR QUESTION (1979)

In a document dated June 10, 1960 and
expressly denominated "Deed of Sale with
Right to Repurchase," AB sold his land to
CD. Substantially, the document provided
among others: "I, AB, being in great need
of money, hereby sell my 10- hectare
coconut land to CD for P2,000.00. It is
agreed that I have the right to repurchase
this land in 10 years. If I fail to buy back the
property, I shall deliver possession thereof
to CD." Upon failure of AB to repurchase
the property, CD, in 1971, consolidated his
title and files an action to recover
possession. AB files an answer offering to
return the P2,000.00 plus interest at the
legal rate. Will the action of CD prosper?
Why
SUGGESTED ANSWER
The action of CD will not prosper. The
contract in the instant case is not a true
contract of sale with right of repurchase.
The purchase price is unusually
inadequate and the vendor is still in
possession of the property. There is now a
presumption that the real covenant or
agreement is an equitable mortgage. This
is strengthened by the fact that AB, the
vendor, was in dire straights: he was in
great need of money. The land, therefore,
is merely the security for the loan.
II. LEASE
A. Kinds of Lease
B. Rights and Obligations of Lessor
C. Rights and Obligations of Lessee
‘Contract of Lease’ defined FORM OF LEASE CONTRACT

• It is a contract by which the owner General Rule: Lease may be made orally
temporarily grants the use of his property or XPN: If the lease of real property is made for
the rendering of some service to another more than one year, it must be in writing, in
who undertakes to pay some rent, compliance with the Statute of Frauds [NCC, Art.
compensation or price. 1403 (2)(e)]
Characteristics A. KINDS OF LEASE

a. Principal Contract
1. Lease of things – one of the parties binds
b. Consensual
himself to give to another the enjoyment or
c. Nominate
use of a thing for a price certain, and for a
d. Onerous period which may be definite or indefinite. No
e. Purpose is to allow enjoyment or use of a lease for a for more than 99 years shall be
thing and should not be immoral valid;
f. Lessor need not be the owner 2. Lease of service, or piece of work – one of
g. Subject matter must be within the the parties binds himself to execute a piece of
commerce of man work or to render to the other some service
h. Period may be definite or indefinite and for a price certain, but the relationship of
is temporary principal and agent does not exist between
them.
ESSENTIAL ELEMENTS OF LEASE
LEASE OF CONSUMABLE GOODS
1. CONSENT General Rule: Consumable Goods cannot be
• On part of owner the subject matter of a contract of lease of things
• On part of lessee (NCC, Art. 1648, 1st part)
Reason: To use or enjoy them, they will have to
General Rule: No person can be be consumed. This cannot be done by the
compelled to become a lessee against his lessee since ownership over them is NOT
will. transferred to the lessee by the contract of
lease.
XPN: In industrial accession where both
XPN:
the landowner and the builder, planter or
1. If they are merely to be exhibited as for
sower acted in good faith. The builder or
display purposes; or,
planter can be compelled to pay 2. If they are accessory to an industrial
reasonable rent if they cannot be obliged establishment (e.g. oil in an industrial firm)
by the landowner to buy the land because
its value is considerably more than that of PERSONS DISQUALIFIED TO BE LESSEES
the building or trees. In case of sower, he 1. Husband and wife
can also he compelled to pay proper rent General Rule: Husband and wife cannot lease
by the landowner (NCC, Art. 448). to each other their separate properties
XPN:
2. OBJECT OF SUBJECT MATTER • If a separation of property was agreed upon in
the marriage settlement.
3. CAUSE • If there has been a judicial separation under
• Rent Art. 135 of the Family Code; (NCC art. 1490)
CONSIDERATION OF LEASE Note: The prohibition applies even to common

‘Cause’ or ‘Consideration’ defined law spouses. For otherwise said spouses would
• The cause or consideration in lease be placed in a better position than legitimate
contracts refers to rentals (for things), spouses.
royalties (for rights), or compensation (for
services). 2. Persons referred to under Art. 1491 of NCC
- because of fiduciary relationships.
• Money, fruits or some other useful thing,
a) The guardian, the property of the person or
The important thing is that what is given by
persons who may be under his
the lessee has value.
guardianship;
b) Agents, the property whose administration B. RIGHTS AND OBLIGATIONS

or sale may have been intrusted to them,
unless the consent of the principal has OF LESSOR
been given;
c) Executors and administrators, the property OBLIGATIONS OF THE LESSOR
of the estate under administration; 1. Delivery of the property in such condition as
d) Public officers and employees, the to render it fit for the use intended
property of the State or of any subdivision 2. Maintain the lessee in peaceful and adequate
thereof, or of any government-owned or enjoyment of the lease for the duration of the
controlled corporation, or institution, the contract
administration of which has been intrusted 3. Making of necessary repairs to keep the thing
to them; this provision shall apply to judges suitable for use, unless there is contrary
and government experts who, in any stipulation
manner whatsoever, take part in the sale;
e) Justices, judges, prosecuting attorneys, WARRANTY OF THE LESSOR
clerks of superior and inferior courts, and 1. That he has a right to lease the thing
other officers and employees connected 2. That the lessee shall enjoy the legal and
with the administration of justice, the peaceful possession of the thing
property and rights in litigation or levied
3. That the thing is fit for the use for which it
upon an execution before the court within
whose jurisdiction or territory they exercise is intended
their respective functions; this prohibition 4. That the thing is free from any hidden fault
includes the act of acquiring by assignment or defect
and shall apply to lawyers, with respect to
the property and rights which may be the RULES IF URGENT REPAIRS ARE
object of any litigation in which they may NECESSARY (NCC, ART. 1662)
take part by virtue of their profession;
1. If repairs last for NOT MORE THAN 40
f) Any others specially disqualified by law.
days, Lessee is obligated to tolerate the
PURPOSE IN RECORDING A LEASE work.
• A lease DOES NOT have to be recorded in 2. If repairs last for 40 DAYS OR MORE
the Registry of Property to be binding Lessee can ask for reduction of the rent in
between the parties. Registration is useful proportion to the time (including the 1st 40
only for the purposes of notifying strangers
days he was deprived of possession/use)
to the transaction (NCC, Art. 1648).
• Registration is not essential for the validity of Note: In either case, rescission may he availed
the contract but is needed to make it in case of dwelling place, and the property
effective regarding third persons. becomes uninhabitable.
EFFECTS IF THE LEASE OF REAL EFFECTS IF THE LESSOR FAIL TO MAKE

PROPERTY IS NOT REGISTERED URGENT REPAIRS
1. The lease is not binding on innocent third
The lessee may:
persons such as a purchaser (Salonga, et al.
v- Acuña, C.A., 54 0.G. 2943); 1. 0rder repairs at the lessor's cost
2. Naturally, such an innocent third person is 2. Sue for damages
allowed to terminate the lease in case he 3. Suspend the payment of the rent; or
buys the property from the owner-lessor. 4. Ask for rescission, in case of substantial
(NCC, Art 1676) (2009 BAR); damage to him
3. When a third person already knows of the
existence and duration of the lease, he is C. RIGHTS AND OBLIGATIONS
bound by such lease even if it has not been OF LESSEE
recorded. The reason is simple: actual
knowledge is, for this purpose, equivalent to
registration (Quimson v. Suarez, G.R. No. L- OBLIGATIONS OF THE LESSEE
21381, April 5 1924; and Gustilo v. Maravilla, 1. To pay the price of the lease
G.R. No. L-2338 December 12, 1925); and 2. Use the thing leased as a diligent father
Note: But if the sale is fictitious and was only of the family
resorted to for the purpose of extinguishing the
lease, the supposed vendee cannot terminate 3. Pay expenses for the deed of lease
the lease. The sale is presumed fictitious if at • In case of violation, lessor may ask for
that time the supposed vendee demands the rescission and damages, or allow the
termination of the lease, the sale is not recorded contract to remain in force but ask for
in the Registry of Property (Art. 1676, 3rd damage
paragraph, NCC).
ASSIGNMENT OF THE LEASE Payments of rent in advance by the sublessee

● Lessee cannot assign the lease contract shall be deemed not to have been made, so far
without the consent of the lessor, unless as the lessor's claim is concerned, unless said
there is a stipulation to the contrary payments were effected in virtue of the custom
of the place.
NATURE OF SUB-LEASE
● It is a separate and distinct contract of TERM OF LEASE CONTRACT
lease wherein the original lessee becomes General Rule: The law does not allow perpetual
a sub-lessor to a sub-lessee lease. There must be a period which may either
be definite or indefinite. No lease for more than
RIGHT OF LESSEE TO SUBLEASE 99 years shall be valid.
● A lessee may generally sublease the
property in the absence of express When no period is fixed:
prohibition because the lessee remains a a. In case of lease of rural lands (NCC, Art
party to the lease even if he has already 1682) - all the time necessary for the
created a sublease thereon. gathering of the fruits which the whole
 e.g. He still must pay rent to the lessor estate leased may yield in one year, or
● Two leases and two distinct judicial which it may yield once, although two or
relations: more years have to elapse for the purpose.
 between the lessor and the lessee b. In case of lease of urban lands (NCC art.
 between the sublessor (lessee) and the 1687); - from year to year, if the rent
sublessee agreed upon is annual; from month to
month, if it is monthly; from week to week,
SUBLEASE VS. ASSIGNMENT if the rent is weekly; and from day to day, if
1. Sublease the rent is to be paid daily; or
• the lessee retains an interest in the lease; c. Lease during the lifetime of one of the
he remains a party to the contract. parties - A lease of things during the
• the sub-lessee does not have any direct lifetime of one of the parties is valid, which
action against the lessor. is considered one for life, ending upon the
• can be done even without the permission death of the party who could have
of the lessor unless there be an express terminated the contract.
prohibition.
2. Assignment DURATION AND TERMINATION OF LEASE
• the lessee makes an absolute transfer of ‘Tacit renewal of lease (Tacita reconduccion)’
his interest as lessee, he dissociates defined
himself from the original contract of lease. If the lessee continues in possession of the thing
• the assignee has a direct action against leased for 15 days with the acquiescence of the
the lessor. lessor, notwithstanding the expiration of the
• cannot be done unless the lessor contract of lease, it is understood that there is an
consents. implied new lease, not for the period of the
original contract, but for the time established by
LIABILITY OF SUBLESSEE TOWARD Article 1682 and 1687. The other terms of the
LESSOR contract shall be revived.
Although the sublessee is not the party to the
contract of lease, the sublessee is still directly Art. 1682. The lease of a piece of rural land,
liable to the lessor for acts appertaining to the when its duration has not been fixed, is
use and preservation of the property. understood to have been for all the time
necessary for the gathering of the fruits which
DIRECT ACTION BY THE LESSOR the whole estate leased may yield in one year,
The lessor may bring an action directly against or which it may yield once, although two or more
the sublessee if he does not use and preserve years have to elapse for the purpose.
the thing leased in accordance with the
agreement between the lessor and the lessee or Art. 1687. If the period for the lease has not
with the nature of the property. been fixed, it is understood to be from year to
year, if the rent agreed upon is annual; from
SUBSIDIARY LIABILITY OF SUBLESSEE TO month to month, if it is monthly; from week to
LESSOR (1999 BAR) week, if the rent is weekly; and from day to day,
Sublessee is subsidiarily liable to the lessor for if the rent is to be paid daily. However, even
any rent due from the lessee. However, the though a monthly rent is paid, and no period for
sublessee shall not be responsible beyond the the lease has been set, the courts may fix a
amount of rent due from him, in accordance with longer term for the lease after the lessee has
the terms of the sublease, at the time of the occupied the premises for over one year. If the
extra-judicial demand by the lessor. rent is weekly, the courts may likewise (CONT>>
determine a longer period after the lessee has d. Lessee devotes the thing leased to any use
been in possession for over six months. In case or service not stipulated, or he fails to
of daily rent, the courts may also fix a longer observe diligence of a good father of a family
period after the lessee has stayed in the place in the use thereof.
for over one month.
RIGHTS TO IMPROVEMENT
MAÑAS V. NICOLASORA 1. If Lessee in good faith makes USEFUL
G.R. No. 208845, February 03, 2020 improvements
• lessor shall pay ½ of the value; if Lessor
Article 1643 of the Civil Code provides: refuses, Lessee may remove even
Article 1643. In the lease of things, one of the though it will cause damage to the
parties binds himself to give to another the principal thing. He shall not cause any
enjoyment of use of a thing for a price certain, more impairment than necessary.
and for a period which may be definite or 2. Ornamental expenses
indefinite. However, no lease for more than • Lessee not entitled to reimbursement;
ninety-nine years shall be valid. he may remove provided no damage is
caused to the principal thing, and if
Based on Article 1643, the lessor's main Lessor does not chose to retain by
obligation is to allow the lessee to enjoy the use paying their value at the time the lease
of the thing leased. Other contract stipulations is extinguished.
unrelated to this— for instance, the right of first
refusal—cannot be presumed included in the BAR QUESTION (2014)
implied contract renewal. The law itself limits the Isaac leased the apartment of Dorotea for two
terms that are included in implied renewals. One (2) years. Six (6) months after, Isaac subleased
cannot simply presume that all conditions in the a portion of the apartment due to financial
original contract are also revived; after all, a difficulty.
contract is based on the meeting of the minds Is the sublease contract valid?
between parties. a. Yes, it is valid for as long as all the
elements of a valid sublease contract are
CJH DEVELOPMENT CORPORATION V. present.
ANICETO b. Yes, it is valid if there is no express
G.R. No. 224006, July 06, 2020 prohibition for subleasing in the lease
• Clearly, there was an implied lease between contract.
the parties. When the lease expired on May c. No, it is void if there is no written consent
17, 2007, CJH Development acquiesced to on the part of the lessor.
Aniceto's continued occupancy. It did not
d. No, it is void because of breach of the lease
send a notice to vacate and even accepted contract.
Aniceto's monthly payments until February
28, 2008. As it was paid monthly, the implied SUGGESTED ANSWER
lease ran on a month-to-month renewal, in
b. Yes, it is valid if there is no express
accordance with Article 1687 of the Civil
prohibition for subleasing in the lease contract.
Code. It follows that the lease would be
terminated by the end of each month, and
CJH Development may choose not to renew BAR QUESTION (2013)
the lease and demand repossession of the Anselmo is the registered owner of a land and
premises. a house that his friend Boboy occupied for a
• In sending the notice to vacate on January nominal rental and on the condition that Boboy
30, 2008, CJH Development signified that it would vacate the property on demand. With
no longer wished to continue the lease. By Anselmo's knowledge, Boboy introduced
then, the month- to-month implied lease was renovations consisting of an additional
terminated. The lessee can no longer insist bedroom, a covered veranda, and a concrete
on staying in the premises against the block fence, at his own expense. Subsequently,
lessor's will because there is no longer a Anselmo needed the property as his residence
contract of lease to speak of. and thus asked Boboy to vacate and turn it
over to him. Boboy, despite an extension, failed
GROUNDS FOR EJECTMENT to vacate the property, forcing Anselmo to send
The Lessor may judicially eject the lessee for him a written demand to vacate. In his own
any of the following causes: written reply, Boboy signified that he was ready
a. When period agreed upon, or period in to leave but Anselmo must first reimburse him
Articles 1682 and 1687 has expired; the value of the improvements he introduced
b. Lack of payment of price stipulated; on the property as he is a builder in good faith.
c. Violation of any conditions agreed upon in the Anselmo refused, insisting that Boboy cannot
contract; ask for reimbursement as he is a mere lessee.
Boboy responded by removing the SUGGESTED ANSWER

improvements and leaving the building in its
Yes, Simon can compel Shannon to reduce the
original state.
agreement into writing. While an agreement for
• Resolve Boboy's claim that as a builder
the leasing of real property for a longer period
in good faith, he should be reimbursed
than one year is covered by the Statute of
the value of the improvements he
Frauds, thus, requiring a written memorandum
introduced.
of its essential provisions under Article 1403,
• Can Boboy be held liable for damages for Civil Code, the contract was taken out of the
removing the improvements over operation of the Statute of Frauds under the
Anselmo's objection? Doctrine of Part Performance. The statute of
SUGGESTED ANSWER frauds applies only to executory contracts, and
not to contracts that are already executed
Boboy's claim that he is a builder in good faith partially or fully. Under Article 1357 of the Civil
has no basis. A builder in good faith is Code, the contracting parties may compel each
someone who occupies the property in the other to observe the form of contract required by
concept of an owner. The provisions on builder- law if the contract is valid and enforceable.
planter-sower under the Civil Code cover cases
in which the builder, planter and sower believe No, it does not constitute a ground for
themselves to be owners of the land, or at terminating the lease. In the contract of lease of
least, to have a claim of title thereto. things, if there is no express prohibition, the
As Boboy is a lessee of the property, even if he lessee may sublet the thing leased (Article
was paying nominal rental, Article 1678 is 1650, Civil Code).
applicable. Under this provision, if the lessee In this contract, there appears to be no
makes, in good faith, useful improvements prohibition regarding subleasing; thus, there is
no violation of the contract which can be used
which are suitable to the use for which the
as a ground for terminating the contract. The act
lease is intended, without altering the form or
of a lessee in subleasing the thing without
substance of the property leased, the lessor
notifying the lessor leased is not one of the
upon the termination of the lease shall pay the
causes for which the lessor may terminate the
lessee one-half of the value of improvements at
lease and judicially eject the lessee (Article
that time. Should the lessor refuse to reimburse
1673, Civil Code).
said amount, the lessee may remove the
improvements, even though the principal thing
BAR QUESTION (2001)
may suffer damage thereby.
On January 1, 1980, Nestor leased the fishpond
No. Boboy cannot be held liable for damages.
of Mario for a period of three years at a monthly
The lessor, Anselmo, refused to reimburse
rental of P1,000.00, with an option to purchase
one-half of the value of the improvements, so
the same during the period of the lease for the
the lessee, Boboy, may remove the same,
price of P500,000.00. After the expiration of the
even though the principal thing may suffer three-year period, Mario allowed Nestor to
damage thereby. If in removing the useful remain in the leased premises at the same
improvements Boboy caused more impairment rental rate. On June 15, 1983, Nestor tendered
in the property leased than is necessary, he will the amount of P500,000.00 to Mario and
be liable for damages (Art. 1678). demanded that the latter execute a deed of
absolute sale of the fishpond in his favor. Mario
BAR QUESTION (2018) refused, on the ground that Nestor no longer
had an option to buy the fishpond.
Simon owned a townhouse that he rented out Nestor filed an action for specific performance.
to Shannon, a flight attendant with Soleil Will the action prosper or not? Why?
Philippine Airlines (SPA). They had no written
contract but merely agreed on a three (3)-year SUGGESTED ANSWER
lease. Shannon had been using the townhouse No, the action will not prosper.
as her base in Manila and had been paying The implied renewal of the lease on a month-to-
rentals for more than a year when she month basis did not have the effect of extending
accepted a better job offer from Sing Airlines. the life of the option to purchase which expired
This meant that Singapore was going to be her at the end of the original lease period. The
new base and so she decided, without lessor is correct in refusing to sell on the
informing Simon, to sublease the townhouse to ground that the option had expired since
Sylvia, an office clerk in SPA. implied new lease only renewed the obligation
• Can Simon compel Shannon to reduce of the lessor to allow the lessee the use and
the lease agreement into writing? possession of the property and not the other
• Does the sublease without Simon’s terms of the original contract of lease
knowledge and consent constitute a extraneous thereto.
ground for terminating the lease?
III. AGENCY
Contract of Agency’ defined APPOINTMENT OF AN AGENT
By the contract of agency, one person binds General Rule: There are no formal
himself to render some service or to do requirements governing the appointment of an
something in representation or on behalf of agent
another, with the consent or authority of the XPN: when the law requires a specific form.
latter (NCC, Art 1868) ● Example: when sale of land or any interest
therein is through an agent, the authority of
Note: The essence of agency is representation. the latter must be in writing; otherwise, the
For a Contract of Agency to exist, it is essential sale shall be void. (Art. 1874)
that the principal consents that the agent shall
act on the former’s behalf and the agent NATURE OF THE RELATIONSHIP BETWEEN
consents so as to act. PRINCIPAL AND AGENT
It is fiduciary in nature that is based on trust and
Characteristics of Agency confidence. The agent is estopped from
1. Bilateral – if it is for compensation, it gives asserting or acquiring an interest adverse to that
rise to reciprocal rights and obligations. of his principal
2. Unilateral – if gratuitous, it creates
obligations for only one of the parties. QUALIFICATION OF A PRINCIPAL
3. Nominate – it has its own name 1. Natural or juridical persons; and
4. Consensual – it is perfected by mere 2. He must have capacity to act
consent.
5. Principal – it can stand by itself without Note: if a person is capacitated to act for himself
or his own right, he can act through an agent.
need of another contract
6. Preparatory and progressive – it is entered
JOINT PRINCIPALS
into means for other purposes that deal with
‘Joint Principal’ defined
the public in particular manner for the agent
Two or more persons appoint an agent for a
to enter into juridical acts with the public in
common transaction or undertaking. The liability
the name of the principal. (Villanueva and
of the joint principals is solidary.
Villanueva vs Tiansay, 2015)
7. Generally onerous Requisites for solidary liability of joint
8. Representative relation – the agent acts for principals
and on behalf of the principal on the matters a. There are two or more principals;
within the scope of his authority and said b. They have all concurred in the appointment
acts have the same legal effect as if they of the same agent;
were personally executed by the principal. c. Agent is appointed for a common transaction
9. Fiduciary and revocable – for the creation of or undertaking.
legal relationship of representation by the
agent on behalf of the principal, the powers RESPONSIBILITY OF TWO OR MORE
of the former are essentially derived from AGENTS
the latter. Neither the principal nor the agent General Rule: the agents are jointly liable.
can be legally made to remain in the XPN: solidarity has been expressly stipulated.
relationship when they choose to have it Each of the agents becomes solidarily liable for.
remained 1. the non fulfillment of the agency
2. negligence of his fellow agent.
Presumption
Agency is never presumed. The relation RULE WITH THE EXECUTION OF AGENCY
between principal and agent must exist as a General Rule: the agent is bound by his
fact with the burden of proof resting upon the acceptance to carry out the agency, in
person alleging the agency. accordance with the instruction of the principal
and is liable for damages which, through his
PARTIES TO A CONTRACT OF AGENCY non-performance, the principal may suffer
1. Principal (Mandante) XPN: if its execution could manifestly result in
One whom the agent represents and from loss or damage to the principal.
whom he derives his authority; he is the
person represented. INSTANCES WHEN THE AGENT MAY INCUR
2. Agent (Mandatario) PERSONAL LIABILITY
One who acts for and represents another; 1. Agent exceeds his authority
he is the person acting in a representative 2. Acts of the agent prevented the performance
capacity on the part of the principal; and
3. When a person acts as agent without EFFECTS OF THE ACTS OF AN AGENT

authority or without a principal; and 1. With authority
4. A person who acts as an agent of an a. In principal’s name – valid
incapacitated principal unless the third b. In his own name – not binding on the
person was aware of the incapacity at the principal; agent and stranger are the
time of the making of the contract. only parties, except regarding things
belonging to the principal or when the
AGENCY BY NECESSITY principal ratifies the contract or derives
• Agency cannot be created by necessity. benefit there from.
2. Without authority
• What is created instead is additional
a. In principal’s name – unenforceable
authority in an agent appointed and
but may be ratified, in which case,
authorized before the emergency arose.
may be validated retroactively from
By virtue of the existence of an the beginning.
emergency, the authority of an agent is b. In his own name – valid on the
correspondingly enlarged in order to cope agent, but not on the principal.
with the exigencies or the necessities of
the moment. RULES AS TO WHEN THE PRINCIPAL IS
NOT BOUND BY THE ACT OF THE AGENT
REQUISITES FOR THE ADDITIONAL General Rule: when the act is without or beyond
AUTHORITY OF AGENT IN CASES OF the scope of his authority in the principal’s name.
NECESSITY XPN: Where the acts of the principal have
1. Real existence of emergency; contributed to deceive a 3rd person in good
2. Inability of the agent to communicate faith.
with the principal; a. Where the limitation upon the power
3. Exercise of additional authority is for the created by the principal could not have
principal’s protection; and been known by the 3rd person.
4. Adoption of fairly reasonable means, b. Where the principal has placed in the
premises duly considered. hands of the agent instruments signed by
him in blank.
RULE REGARDING DOUBLE AGENCY c. Where the principal has ratified the acts of
General Rule: it is disapproved by law for the agent.
being against public policy and sound morality.
General Rule: when the act is within the scope
XPN: where the agent acted with full
of the agent’s authority but in his own name.
knowledge and consent of the principals.
XPN: when the transaction involves things
belonging to the principal.
ACTS THAT A PRINCIPAL MAY DELEGATE
TO HIS AGENT Note: The limits of the agent’s authority shall not
General Rule: what a man may do in person, be considered exceeded should it have been
he may do through another. performed in a manner more advantageous to
XPN: the principal than that specified by him.
1. Personal acts;
2. Acts not allowed by law RIGHTS OF THE AGENT
3. Not allowed by stipulations Instances when the agent may retain in
pledge the object of the agency (Legal
INSTANCES WHEN THE ACT OF AN Pledge)
AGENT IS BINDING TO THE PRINCIPAL 1. If the principal fails to reimburse the agent
1. When the agent acts as such without the necessary sums, including interest,
expressly binding himself or does not which the latter advanced for the execution
exceed the limits of his authority. of the agency
2. If principal ratifies the act of the agent 2. If the principal fails to indemnify the agent
which exceeded his authority. for all damages which the execution of the
3. Circumstances where the principal agency may have caused the latter,
himself was, or ought to have been without fault or negligence on his part
aware
Rule when two persons deal separately with
4. If such act is within the terms of the
the agent and the principal
power of attorney, as written
If the two contracts are incompatible with each
5. Principal has ratified, or has signified his other, the one of prior date shall be preferred.
willingness to ratify the agent’s act. This is subject however to the rule on double
sales.
RESPONSIBILITIES AND OBLIGATIONS OF Exceptions to the theory of imputed

AGENT knowledge
Specific obligations of an agent to the principal:
1. The agent’s interests are adverse to those
1. Carry out agency.
of the principal.
2. Answer for the damages which through
his non-performance the principal may 2. The agent’s duty is not to disclose the
suffer. information, as where he is informed by
3. Finish the business already begun on the way of confidential information.
death of the principal should delay entail 3. The person claiming the benefit of the rule
danger. colludes with the agent to defraud the
4. Observe the diligence of a good father of principal.
a family in the custody and preservation
of the goods forwarded to him by the
OBLIGATIONS OF A PERSON WHO
owner in case he declines an agency,
until an agent is appointed. DECLINES AN AGENCY
5. Advance the necessary funds should • A person who declines an agency is still
there be a stipulation to do so except bound to observe the diligence of a good
when the principal is insolvent. father of the family in the custody and
6. Act in accordance with the instructions of preservation of goods forwarded to him by the
the principal. owner. This is based on equity.
7. Not to carry out the agency if its execution
would manifestly result in loss or damage
BREACH OF LOYALTY OF THE AGENT
to the principal.
8. Answer for the damages if there being a • In case of breach of loyalty, the agent is NOT
conflict between his interests and those of entitled to commission.
the principal, he should prefer his own. • The forfeiture of the commission will take
9. Not to loan himself if he has been place regardless of whether the principal
authorized to lend money at interests suffers any injury by reason of such breach of
10. Render an account of his transactions loyalty. It does not even matter if the agency
and to deliver to the principal whatever he is for gratuitous one, or that the principal
may have received by virtue of the
obtained better results, or that usage and
agency, even though it may not be owing
customs allow a receipt of such a bonus.
to the principal.
11. Distinguish goods by countermarks and
designate the merchandise respectively OBLIGATION TO RENDER ACCOUNTING
belonging to each principal, in the case of • Every agent is bound to render an account of
a commission agent who handles goods his transaction and to deliver to the principal
of the same kind and mark, which belong whatever he may have received by virtue of
to different owners. the agency, even though it may not be owing
12. Be responsible in certain cases for the to the principal.
acts of the substitute appointed by him.
• Stipulation exempting the agent is void (Art.
13. Pay interest on funds he has applied to
his own use. 1891)
14. Inform the principal, where an authorized
sale on credit has been made of such AGENCY BY ESTOPPEL
sale. ‘Agent by Estoppel’ defined
15. Bear the risk of collection and pay the It is when one leads another to believe that
principal the proceeds of the sale on the certain person is his agent, when as a matter of
same terms agreed upon with the fact such is not true, and the latter acts on such
purchaser should he receive also on sale,
misrepresentation, the former cannot disclaim
a guarantee commission.
16. Indemnify the principal at the time that liability, for he has created an agency by
they become due. estoppel.
THEORY OF IMPUTED KNOWLEDGE Rules regarding estoppel in agency

The importance of the duty to give information 1. Estoppel of agent - one professing to act
of material facts becomes readily apparent as agent for another may be estopped to
when it is borne in mind that knowledge of the deny his agency both as against his
agent is imputed to the principal even though
asserted principal and the third persons
the agent never communicated such
interested in the transaction in which he
knowledge to the principal.
engaged.
2. Estoppel of principal In this case, Conchita has impliedly ratified her

a. As to agent mother's assent to the partition on her behalf by
b. As to sub agent failing to assail the RTC's April 13, 2007 Order
c. As to third person and the conduct of the raffle for distribution of
the property even after she had obtained a
DOCTRINE OF APPARENT AUTHORITY copy of the Order and the Minutes of Raffle.
The principal is liable only as to third persons
who have been led reasonably to believe by CLASSIFICATION OF AGENCY AS TO
the conduct of the principal that such actual AUTHORITY CONFERRED
authority exists, although none has been Agency Couched In General or Specific
given. Terms
Couched in General Terms
SILVA V. LO • Comprises only acts of administration, even
G.R. No. 206667, June 23, 2021 if the principal should state that he withholds
J. Hernando no power or that the agent may execute
Law and jurisprudence recognize actual such acts as he may consider appropriate,
authority and apparent authority. Apparent or even though the agency should authorize
authority is based on the principle of estoppel. a general and unlimited management.
The Civil Code provides: [Article 1877]
Article 1431. Through estoppel an admission • Examples Of Acts Of Administration
or representation is rendered conclusive upon  To lease real property to another person
the person making it, and cannot be denied or for one year or less, provided the lease is
disproved as against the person relying not registered. [Article 1878, No. 8 by
implication]
thereon.
 To make customary gifts for charity or to
xxx
employees in the business managed by
the agent. [Article 1878, No. 6]
Article 1869. Agency may be express, or
 To borrow money if it is urgent and
implied from the acts of the principal, from his
indispensable for the preservation of the
silence or lack of action, or his failure to
things under administration. [Article
repudiate the agency, knowing that another
1878, No. 7]
person is acting on his behalf without authority.
Couched in Specific Terms
Agency may be oral, unless the law • ‘Special Power of Attorney (SPA)’
requires a specific form. • This refers to a clear mandate (express or
Conchita failed to give her mother notice of the implied) specifically authorizing the
revocation and belatedly repudiated her assent performance of the act, and must therefore
to the 2006 Kasunduan which was signed by be distinguished from an agency couched in
her mother on her behalf despite her full and general terms.
complete knowledge that Civil Case No. Q-89-
3137 was ongoing and that the partition of her CLASSIFICATION OF AGENCY AS TO
father's estate's properties was underway. AUTHORITY CONFERRED
Conchita could not feign ignorance of the Cases Wherein Special Power Of Attorney Is
action for partition and what it sought, and the Necessary:
consequence of failing to inform her mother 1. To make such payments as are not usually
that she had revoked the SPA which she had considered as acts of administration;
previously given her. 2. To effect novations which put an end to
obligations already in existence at the time
The various Orders of the RTC partitioning the agency was constituted;
different properties of the estate clearly show 3. To compromise, to submit questions to
that Concepcion or Atty. Tuason repeatedly arbitration, to renounce the right to appeal
and consistently drew the lot on Conchita's from a judgment, to waive objections to the
behalf in the numerous raffles conducted by venue of an action or to abandon a
the trial court to determine which portion of the prescription already acquired;
property to be divided will go to which heir. 4. To waive any obligation gratuitously;
5. To enter into any contract by which the
The second paragraph of Article 1317 of the ownership of an immovable is transmitted
Civil Code provides that "a contract entered or acquired either gratuitously or for a
into in the name of another by one who has no valuable consideration;
authority x x x shall be unenforceable, unless it 6. To make gifts, except customary ones for
is ratified, expressly or impliedly, by the person charity or those made to employees in the
on whose behalf it has been executed x x x.“ business managed by the agent;
7. To loan or borrow money, unless the latter 4. When it was stipulated that the expenses
act be urgent and indispensable for the would be borne by the agent, or that the
preservation of the things which are under latter would be allowed only a certain sum.
administration;
8. To lease any real property to another person LIABILITY FOR TORT COMMITTED BY THE
for more than one year; AGENT
9. To bind the principal to render some service General Rule: where the fault or crime
without compensation; committed by the agent who is not in the
10. To bind the principal in a contract of performance of an obligation of the principal, the
partnership; latter is not bound by the illicit acts of the agent,
11. To obligate the principal as a guarantor or even if it is done in connection with the agency.
surety; XPN:
12. To create or convey real rights over 1. Where the tort was committed by the agent
immovable property; because of defective instructions from the
13. To accept or repudiate an inheritance; principal or due to lack of necessary
14. To ratify or recognize obligations contracted vigilance or supervision on his part; or
before the agency; 2. When the tort consists in the performance
15. Any other act of strict dominion. [Article of an act which is within the powers of an
1878] agent but becomes criminal only because
of the manner in which the agent has
LIMITATIONS ON SPA performed it; the principal is civilly liable to
1. A special power to sell excludes the power to 3rd persons who acted in good faith.
mortgage.
2. A special power to mortgage does not IRREVOCABLE AGENCY
include the power to sell. General Rule: agency is revocable at will by the
3. A special power to compromise does not principal.
authorize submission to arbitration. XPN: an agency is irrevocable.
1. If a bilateral contract depends upon it.
RIGHTS AND OBLIGATIONS OF THE 2. If it is the means of fulfilling an obligation
PRINCIPAL already contracted.
Obligations of the principal to the agent 3. If partner is appointed manager and his
1. Comply with all obligations which the agent removal from the management is
may have contracted within the scope of his unjustifiable.
authority. 4. If it has been constituted in the common
2. Advance fund to the agent should the latter interest of the principal and the agent, or in
so request the sums necessary for the the interest of a third person who has
execution of the agency. accepted the stipulation in his favor.
3. Reimburse the agent for all advances made 5. Stipulation pour atrui.
by him even if the business or undertaking XPN to the XPN: When the agent acts to
was not successful provided the agent is free defraud the principal.
from fault.
4. Indemnify the agent for all damages which MODES OF EXTINGUISHMENT
the execution of the agency may have 1. By agreement to extinguish
caused the latter without fault or negligence 2. By its revocation
on his part 3. By the withdrawal of the agent;
5. Pay the agent the compensation agreed 4. By the death, civil interdiction, insanity or
upon, or if no compensation was specified, insolvency of the principal or of the agent.
the reasonable value of the agent’s services. 5. By the dissolution of the firm or corporation
which entrusted or accepted the agency;
LIABILITY FOR THE EXPENSES INCURRED 6. By the accomplishment of the object or
BY THE AGENT purpose of the agency.
General Rule: principal is liable for the 7. By the expiration of the period for which
expenses incurred by the agents. the agency was constituted.
XPN:
1. If the agent acted in contravention of the Note: the list is not exclusive: may also be
principal’s instructions, unless principal extinguished by the modes of extinguishment of
should wish to avail himself of the benefits obligations in general whenever they are
derived from the contract. applicable, like loss of the thing and novation.
2. When the expenses were due to the fault of
the agent. KINDS OF REVOCATION
3. When the agent incurred them with Revocation may either be:
knowledge that an unfavorable result would a. express or
ensue, if the principal was not aware thereof; b. implied.
or
A contract of agency is impliedly revoked when 2. The agent must continue to act until the
the principal: principal has had reasonable opportunity
1. Appoints a new agent for the same to take the necessary steps to meet the
business or transaction. situation even if he should withdraw from
2. Directly manages the business entrusted to the agency.
the agent
3. After granting the general power of attorney KINDS OF WITHDRAWAL BY THE AGENT
to an agent, which results in the revocation 1. Without just cause – the law imposes
of the former as regards the special matter upon the agent the duty to give due notice
involved in the latter. to the principal and to indemnify the
principal should the latter suffer damage
EFFECT OF DIRECT MANAGEMENT BY THE by reason of such withdrawal.
PRINCIPAL 2. With just cause – if the agent withdraws
General Rule: the agency is revoked for there from the agency for a valid reason as
would no longer be any basis for the when the withdrawal is based on the
representation previously conferred. But the impossibility of continuing with the agency
principal must act in good faith and not merely to without grave detriment to himself or is
avoid his obligation to the agent. due to a fortuitous event, the agent cannot
XPN: the only desire of the principal is for him be held liable.
and the agent to manage the business together.
DEATH OF PRINCIPAL TO THE CONTRACT
REVOCATION OF AGENCY WHEN THE OF AGENCY
AGENT IS APPOINTED BY TWO OR MORE
• The agency shall remain in full force and
PRINCIPALS
effect even after the death of the principal, if
When two or more principals have granted a
it has been constituted in the common
power of attorney for a common transaction, any
interest of the latter and of the agent, or in
one of them may revoke the same without the
the interest of a third person who has
consent of the others.
accepted the stipulation in his favor. (Art
1930)
NECESSITY OF NOTICE OF REVOCATION
• Anything done by the agent, without
1. As to the agent – express notice is not
knowledge of the death of the principal or of
always necessary; sufficient notice if the
party to be notified actually knows, or has any other cause which extinguishes the
reason to know, a fact indicating that his agency, is valid and shall be fully effective
authority has been terminated/suspended; with respect to third persons who may have
revocation without notice to the agent will contracted with him in good faith. (Art 1931)
not render invalid an act done in pursuance
of the authority. LOPEZ V. HON. COURT OF APPEALS
2. As to 3rd persons – express notice is G.R. No. 163959, August 1, 2018
necessary. One of the modes of extinguishing a contract of
a. As to former customers – actual agency is by the death of either the principal or
notice must be given to them because the agent. In Rallos v. Felix Go Chan & Sons
they always assume the continuance Realty Corporation, the Court declared that
of the agency relationship because death of the principal extinguished the
b. As to other persons- notice by agency, it should follow a fortiori that any act of
publication is enough. the agent after the death of his principal should
be held void ab initio unless the act fell under
WHEN THE AGENT CAN WITHDRAW FROM the exceptions established under Article 1930
THE AGENCY and Article 1931 of the Civil Code. The
The agent may renounce or withdraw from the exceptions should be strictly construed. In other
agency at any time, without the consent of the words, the general rule is that the death of the
principal, even in violation of the latter’s principal or, by analogy, the agent extinguishes
contractual rights; subject to liability for breach of the contract of agency, unless any of the
contract or for tort. circumstances provided for under Article 1930
or Article 1931 obtains; in which case,
Note: The duties and responsibilities of the notwithstanding the death of either principal or
withdrawing agent. agent, the contract of agency continues to exist.
1. If the principal should suffer damage by
reason of the withdrawal by the agent, the DEATH OF AGENT
latter must indemnify the principal therefor, if the agents dies, his heirs must notify the
unless the agent should base his principal thereof, and in the meantime adopt
withdrawal upon the impossibility of such measure as the circumstances may
continuing the performance of the agency demand in interest of the latter.
without grave detriment to himself.

Joe Miguel, a well-known treasure hunter in As an agent, AL was given a guarantee
Mindanao, executed a Special Power of commission, in addition to his regular
Attorney (SPA) appointing his nephew, John commission, after he sold 20 units of
Paul, as his attorney-in-fact. John Paul was
refrigerators to a customer, HT Hotel. The
given the power to deal with treasure-hunting
customer, however, failed to pay for the
activities on Joe Miguel's land and to file
charges against those who may enter it without units sold. AL’s principal, DRBI,
the latter's authority. Joe Miguel agreed to give demanded from AL payment for the
John Paul forty percent (40%) of the treasure customer’s accountability. AL objected, on
that may be found on the land. Thereafter, the ground that his job was only to sell and
John Paul filed a case for damages and not to collect payment for units bought by
injunction against Lilo for illegally entering Joe the customer.
Miguel's land. Subsequently, he hired the legal
services of Atty. Audrey agreeing to give the Is AL’s objection valid? Can DRBI
latter thirty percent (30%) of Joe Miguel's share collect from him or not? Reason.
in whatever treasure that may be found in the
land. Dissatisfied however with the strategies SUGGESTED ANSWER
implemented by John Paul, Joe Miguel
unilaterally revoked the SPA granted to John No, AL’s objection is not valid and DRBI
Paul. Is the revocation proper? can collect from AL. Since AL accepted a
guarantee commission, in addition to his
SUGGESTED ANSWER regular commission, he agreed to bear the
No, the revocation was not proper. As a rule, a risk of collection and to pay the principal
contract of agency may be revoked by the the proceeds of the sale on the same terms
principal at will. However, an agency ceases to agreed upon with the purchaser (Article
be revocable at will if it is coupled with an 1907, Civil Code)
interest or if it is a means of fulfilling an
obligation already contracted (Art. 1927). In the
BAR QUESTION (2001)
case at bar, the agency may be deemed an
agency coupled with an interest not only Richard sold a large parcel of land in Cebu
because of the fact that John Paul expects to to Leo for P100 million payable in annual
receive 40% of whatever treasure may be installments over a period of ten years, but
found but also because he also contracted the
title will remain with Richard until the
services of a lawyer pursuant to his mandate
purchase price is fully paid. To enable Leo
under the contract of agency, and he therefore
stands to be liable to the lawyer whose to pay the price, Richard gave him a power-
services he has contracted. (Sevilla v. Tourist of-attorney authorizing him to subdivide the
World Service, G.R. No. L-41182-3 April 16, land, sell the individual lots, and deliver the
1988) proceeds to Richard, to be applied to the
purchase price.
BAR QUESTION (2013)
Five years later, Richard revoked the power
Jo-Ann asked her close friend, Aissa, to buy
of attorney and took over the sale of the
some groceries for her in the supermarket.
Was there a nominate contract entered into subdivision lots himself.
between Jo-Ann and Aissa? In the affirmative,
what was it? Explain. Is the revocation valid or not? Why?
Yes, there was a nominate contract. On the The revocation is not valid. The power of
assumption that Aissa accepted the request of attorney given to the buyer is irrevocable
her close friend Jo-Ann to buy some groceries because it is coupled with an interest:
for her in the supermarket, what they entered the agency is the means of fulfilling the
into was a nominate contract of Agency. obligation of the buyer to pay the price of
Article 1868 of the New Civil Code provides
the land (Article 1927, CC). In other words,
that by the contract of agency a person binds
a bilateral contract (contract to buy and sell
himself to render some service or to do
something in representation or on behalf of the land) is dependent on the agency.
another, with the consent or authority of the
latter.
BAR QUESTION (2004)

CX executed a special power of attorney
authorizing DY to secure a loan from any bank
and to mortgage his property covered by the
owner’s certificate of title. In securing a loan
from MBank, DY did not specify that he was
acting for CX in the transaction with said bank.
Is CX liable for the bank loan? Why or why
not? Justify your answer.
SUGGESTED ANSWER
CX is liable for the bank loan because he
authorized the mortgage on his property to
secure the loan contracted by DY.
If DY later defaults and fails to pay the loan, CX

is liable to pay. However, his liability is limited
to the extent of the value of the said property
CX is not personally liable to the bank loan
because it was contracted by DY in his
personal capacity. Only the property of CX is
liable. Hence, while CX has authorized the
mortgage on his property to secure the loan of
DY, the bank cannot sue CX to collect the loan
in case DY defaults thereon. The bank can only
foreclose the property of CX. And if the
proceeds of the foreclosure are not sufficient to
pay the loan in full, the bank cannot run after
CX for the deficiency.
IV. CREDIT TRANSACTIONS

A. Loans D. Real Estate Mortgage
B. Deposit E. Antichresis
C. Guaranty and Suretyship
A. LOANS MUTUUM OR SIMPLE LOAN

‘Mutuum’ or ‘Simple Loan’ defined
Article 1933. By the contract of loan, one Where the lender delivers to the borrower
of the parties delivers to another, either money or other consumable thing upon the
something not consumable so that the condition that the latter will pay the same
latter may use the same for a certain amount of the same kind and quality
time and return it, in which case the
contract is called a commodatum; or Article 1934. An accepted promise to deliver
money or other consumable thing, upon something by way of commodatum or simple
loan is binding upon parties, but the
the condition that the same amount of the
commodatum or simple loan itself shall not be
same kind and quality shall be paid, in
perfected until the delivery of the object of the
which case the contract is simply called a
contract.
loan or mutuum.
• Mutuum and Commodatum are REAL
Commodatum is essentially gratuitous. CONTRACTS which require delivery for
perfection
Simple loan may be gratuitous or with a • Delivery is necessary in view of the purpose
stipulation to pay interest. of the contract which is to TRANSFER either
the use or ownership of the thing loaned.
In commodatum the bailor retains the
ownership of the thing loaned, while in COMMODATUM
simple loan, ownership passes to the Kinds of Commodatum:
borrower. 1. Ordinary Commodatum - Use by the
bailee of the thing is for a certain period of
Characteristics of the Contract of Loan time (Art. 1933)
1. Real contract – delivery is essential for 2. Precarium - One whereby the bailor may
perfection of the loan BUT a promise to demand the thing loaned at will;
lend, being consensual, is binding upon
the parties It exists in cases where:
2. Unilateral contract – once the subject a. neither the duration of the contract nor the
matter has been delivered, only the use to which the thing loaned should be
devoted has been stipulated.
borrower has the obligation
b. if the use of the thing is merely tolerated by
the owner. (Art. 1947)
Considerations of the Contract of Loan
As to borrower – the acquisition of the thing NATURE OF COMMODATUM
As to lender – the right to demand its return 1. Cause
or its equivalent • essentially gratuitous (otherwise, if there Is
compensation, it might be lease)
WHEN IS A THING CONSIDERED • commodatum is similar to donation in that it
CONSUMABLE? confers a benefit to the recipient; the
● It is consumable when used in a presumption is that the bailor has loaned the
manner appropriate for its purpose or thing for having no need therefore (Art. 1946)
nature, like gasoline, rice, money, fruit,
firewood, etc. 2. Purpose
• temporary use of the thing loaned but not its
1. KINDS OF LOANS fruits, unless stipulated or is incidental
- Commodatum (otherwise, if the bailee is not entitled to the
- Mutuum use of the thing, it might be deposit)
COMMODATUM 3. Subject matter

‘Commodatum’ defined • generally non-consumable goods but if the
Where the bailor (lender) delivers to the bailee consumable goods are noT for consumption,
such may be the subject of the commodatum,
(borrower) a non-consumable thing so that the
as when merely for exhibition (Art. 1936)
latter may use it for a certain time and return
the identical thing
4. Bailor need not be the owner of the thing Reasons:

loaned (Art 1938) a. Ownership remains in bailor – the bailee
• it is sufficient that he has a possessory acquires only the use of thing, the
interest ownership of which remains w/ the bailor;
• a mere lessee or usufructuary may lend but b. Only temporary use given to bailee – the
the borrower or bailee himself may not lend bailee would be violating the bailor’s trust
nor lease the thing loaned to him to a third in him to return the thing as soon as the
person (Art. 1932[2]) period stipulated expires or the purpose
has been accomplished.
5. Purely personal XPN to Right of Retention: Claim for
a. Death of either party terminates the damages suffered because the bailor did
not advise bailee of the flaws known to
contract UNLESS there is stipulation to
him (Arts. 1951; 1944)
the contrary
6. A bailee doesn’t answer for the Deterioration
b. Generally, bailee can neither lend nor
of the thing loaned due only to the use
lease the object to a 3rd person in the
thereof and without his fault;
absence of some agreement to that 7. Liability when there are 2 or more bailees:
effect The presumption is that they are solidarily
c. Use of the thing loaned may extend to liable (Art. 1945)
the bailee’s household (who are not Reason for the presumption: to safeguard
considered 3rd persons) except: effectively the right of the bailor. The law
1. when there is a contrary stipulation presumes that the bailor takes into account
2. nature of the thing forbids such use the personal integrity and responsibility of all
the bailees and that, therefore, he would not
6. Enjoyment of fruits have constituted the commodatum if there
a stipulation to make use of fruits is valid, but it were only one bailee.
is never presumed. The enjoyment of the fruits
must only be incidental to the use of the thing BAILEE’S LIABILITY FOR LOSS EVEN DUE
itself, for if it is the main cause, the contract TO FORTUITOUS EVENT
may be one of usufruct. General Rule: the bailee is not liable for loss or
damage due to a fortuitous event (Art. 1174)
OBLIGATIONS OF THE BAILEE (Arts 1941- Rationale: the bailor retains the ownership of
1945) the thing loaned.
1. To pay for the Ordinary expenses for the
use and preservation of the thing loaned XPN: (Art. 1942 – punishes the bailee for his
(Art. 1941) improper acts although they may not be the
2. To pay for all Other expenses proximate cause of the loss)
• XPN: Other than those referred to in Art. a. Bad faith – if the bailee devotes the thing
1941 and 1949 (refund of extraordinary to any purpose different from that for which
expenses in full, or in half (if incurred it has been loaned
b. Has been delivered with Appraisal - the
while bailee in actual use) (Art. 1950)
thing loaned has been delivered with
• Reason: Bailee makes use of the thing.
appraisal of its value, UNLESS there is a
Expenses for ostentation are to borne by
stipulation exempting the bailee from
the bailee because they are not
responsibility in case of a fortuitous event
necessary for the preservation of the c. Ingratitude - being able to save the thing
thing. borrowed or his own thing, he chose to
• For Extraordinary expenses for save the latter
preservation, bailor must reimburse the d. Lends the subject matter to a 3rd
bailee, since he is the one who profits person – he lends or leases the thing to a
from said expenses. third person who is not a member of his
3. To take good Care of the thing with the household
diligence of a good father of a family (Art. e. Delay - he keeps it longer than the period
1163) stipulated or after the accomplishment of
4. To be liable for Loss, except due to a the use for which the commodatum has
fortuitous event UNLESS under been constituted
exceptional circumstances (Art 1942)
5. The bailee has NO RIGHT to Retain the OBLIGATIONS OF THE BAILOR
thing loaned as security for claims he has 1. Primary obligation of the bailor:
against the bailor, even though they may General Rule: To allow the bailee the use of the
be by reason of extraordinary expenses thing loaned for the duration of the period
(Art. 1944) stipulated or until the accomplishment of the
purpose for w/c the commodatum was
constituted
XPN: the bailor may demand the return or its XPN: Stipulation to the contrary that provide for
temporary use upon: a different apportionment of such expenses or
a. bailor has an URGENT NEED FOR THE that they shall be borne by the bailee or bailor
THING (Art. 1946) – the contract is alone
suspended
• Reason: the right of the bailor is based 6. The depreciation caused by the
on the fact that commodatum is reasonable and natural use of the thing is
essentially gratuitous borne by the bailor (Art.1943)
b. bailee commits AN ACT OF Reason: The parties to the contract know that
INGRATITUDE (Art. 1948) the thing borrowed cannot be used without
• if the bailee should commit an offense deterioration due to ordinary wear and tear.
against the person, the honor or the XPN:
property of the bailor, or of the wife or a. when there is a stipulation to the
children under his parental authority contrary;\
• if the bailee imputes to the bailor any b. when the bailee is guilty of fault or
criminal offense, or any act involving
negligence;
moral turpitude, even though he should
c. if he devotes the thing to any purpose
prove it, unless the crime or the act has
different from that for which has been
been committed against the
loaned
bailee himself, his wife, or
children under his authority; and
• if the bailee unduly refuses the bailor
7. To pay damages for known hidden flaws
support when the bailee is legally or (Art. 1951)
morally bound to give support to the Requisites: (the following must concur)
bailor a. there is a flaw or defect in the thing
• Reason: the person who commits any loaned
of the acts of ingratitude makes himself b. the flaw or defect is hidden
unworthy of the trust reposed upon him c. the bailor is aware thereof
by the bailor. d. he does not advise the bailee of the same
e. the bailee suffers damages by reason of
2. May demand the thing at will when the the flaw or defect
contract is precarium XPN: when the defect is not known to the
bailor, he is not liable because commodatum is
‘Precarium’ defined gratuitous.
a kind of commodatum where the bailor may
demand the thing at will. It has been defined as 8. The bailor has no right of abandonment
a contract by which the owner of a thing, at the for expenses and damages (Art. 1952)
request of another person, gives the latter the Reason: The expense and/or damages may
thing for use as long as the owner shall please. exceed the value of the thing loaned.
3. To refund the extraordinary expenses (Art. MUTUUM

1949) ‘Mutuum’ defined
General Rule on reimbursement: Notice Contract whereby one of the parties delivers to
should be given by the bailee to the bailor another money or other fungible thing w/ the
regarding such extraordinary expenses understanding that the same amount of the
Rationale: notice is required because it is same kind and quality shall be paid. (Art. 1933)
possible that the bailor may not want to incur the
extraordinary expense at all. NATURE OF MUTUUM
XPN: where the extraordinary expenses are so a. bilateral - borrower’s promise to pay is
urgent that the reply to the notification cannot be the consideration for the lender’s
awaited w/o danger. obligation to furnish the loan
b. no criminal liability upon failure to pay
4. If the extraordinary expenses arise from
the actual use of the thing and even though
SUBJECT MATTER
bailee acted w/o fault, the expenses will be
a. fungible or consumable-depending on the
borne equally by both the bailor and the
intent of the parties, that the return of the
bailee (50-50) (Art. 1949)
thing is equivalent only and not the
Reasons:
identical thing
a. the bailee pays ½ because of the benefit
derived from the use of the thing loaned to
b. Money
him; c. if the transfer of ownership is on a non-
b. the bailor pays the other ½ because he is fungible thing (irreplaceable), with the
the owner and the thing will be returned to obligation of the other to give other thing
him by agreement, it is a barter
2. INTEREST IV. Prospective Application

• The 6% per annum rate of legal interest shall
PAYMENT OF LOAN INTEREST be applied prospectively:
General Rule: No interest shall be due unless • Final and executory judgments awarding
it has been expressly stipulated in writing (Art. damages prior to July 1, 2013 shall apply the
1956) 12% rate;
XPN: Indemnity for damages – the debtor in • Final and executory judgments awarding
delay is liable to pay legal interest as indemnity damages on or after July 1, 2013 shall apply
for damages even in the absence of a the 12% rate for unpaid obligations until June
stipulation for the payment of interest. 30, 2013; unpaid obligations with respect to
● Interest as indemnity for damages is said judgments on or after July 1, 2013 shall
payable only in case of default or non- still incur the 6% rate.
performance of contract (Art. 2209).
B. DEPOSIT
Basis for computation for indemnity:
● Eastern Shipping Lines vs. Court of ‘Deposit’ defined
Appeals, as modified by Nacar vs. Gallery • A deposit is constituted from the moment a
Frames based on BSP-MB Circular No. person receives a thing belonging to
799 dated June 21, 2013 which lowered another, with the obligation of safely keeping
the legal rate of interest from 12% to 6%. it and of returning the same. (Art. 1962)
• If the safekeeping of the thing delivered is
not the principal purpose of the contract,
Rules on Interest
there is no deposit but some other contract.
I. When obligation breached is Monetary
Obligation, ex. Loans of forbearance of
Note: it is essential that the depositary is not
money:
the owner of the thing deposited
a. Interest due shall be that stipulated in
writing;
CHARACTERISTICS
• Interest due shall earn legal interest of
1. real - because it is perfected only by the
6% from date of judicial demand (filing
delivery of the subject matter BUT an
of the case)
agreement to constitute a deposit is
a. If no stipulation in writing, interest shall be
binding and enforceable, since it is merely
6% per annum to be computed from
consensual
default (either failure to pay upon extra-
2. unilateral - if gratuitous, because only the
judicial demand or upon judicial demand
depositary has the obligation
whichever is appropriate and subject to
3. bilateral - if with compensation, because
the provisions of Article 1169 of the Civil
it gives rise to obligations on the part of
Code)
both depositary and depositor
II. When obligation breached is Non-
CREATION OF DEPOSIT (Art. 1964)
Monetary Obligation
• may be constituted judicially or extrajudicially
a. If already liquidated, rate of interest shall
1. By virtue of a court order; or
be 6% per annum, demandable from date
2. By law
of judicial or extra-judicial demand (Art.
3. By the will of the parties
1169, Civil Code)
• It is essential that the depositary is not the
b. If unliquidated, no interest
owner of the property deposited (Art. 1962)
XPN: When later on established with
certainty. Interest shall still be 6% per
KINDS OF DEPOSIT
annum demandable from the date of
1. Judicial - when an attachment or seizure of
judgment because on such date, it is
property in litigation is order
already deemed that the amount of
2. Extrajudicial (Art. 1967)
damages is already ascertained.
a. voluntary- delivery is made by the
will of the depositor or by two or
III. Compounded Interest
more persons each of whom
• This is applicable to both monetary and non-
believes himself entitled to the thing
monetary obligations
deposited;
• 6% per annum computed against award of
b. necessary- made in compliance with
damages (interest) granted by the court. To
a legal obligation, or on the occasion
be computed from the date when the court’s
of any calamity, or by travelers in
decision becomes final and executory until
hotels and inns (Arts 1996-2004) or
the award is fully satisfied by the losing
by travelers with common carriers
party.
(Arts 1734-1735)
DEPOSIT IS GENERALLY GRATUITOUS: • The depositary cannot excuse himself

(Art. 1965) from liability in the event of loss by
General Rule: A deposit is generally claiming that he exercised the same
gratuitous. amount of care toward the thing
XPN: deposited as he would towards his own
a. when there is a contrary stipulation if such care is less than that required by
b. where depositary is engaged in the the circumstances.
business of storing goods
c. Property is saved from destruction 2. Obligation not to transfer deposit (Art.
without knowledge of the owner 1973)
d. Judicial deposit • General Rule: the depositary is not allowed
to deposit the thing with a third person.
• Reason: A deposit is founded on trust and
DEPOSITOR IS THE OWNER OF THE
confidence and it can be supposed that the
THING
depositor, in choosing the depositary, has
General Rule: The depositor must be the
taken into consideration the latter’s
owner of the thing deposited (not required to qualification.
prove ownership). • XPN: The depositary is authorized by express
XPN: It may belong to another person than the stipulation.
depositor. • Liabilities: Depositary is liable for loss of the
a. when two or more persons claiming to be thing deposited when:
entitled to a thing may deposit the same a. He transfers the deposit with a third
with a third person. In such case, the person without authority although
third person assumes the obligation to there is no negligence on his part and
deliver to the one to whom it belongs. the third person;
b. Interpleader – the action to compel the b. He deposits the thing with a third
depositors to settle their conflicting person who is manifestly careless or
claims. Here one of the depositors is not unfit although authorized, even in the
the owner. absence of negligence; or
c. The thing is lost through the
SUBJECT MATTER OF DEPOSIT (Art. 1966) negligence of his employees whether
General Rule: only movable or personal the latter are manifestly careless or
property may be the object of deposit, whether not.
voluntary or necessary. • Exemption from liability: The thing is lost
XPN: In judicial deposit, it may cover both without the negligence of the third person with
movable and immovable property. whom he was allowed to deposit the thing if
such third person is not “manifestly careless
FORM OF CONTRACT OF DEPOSIT: or unfit.
• A contract of deposit may be entered into
orally or in writing. (Art. 1969) 3. Obligation not to change the way of
deposit (Art. 1974)
• BUT Delivery of the thing deposited is
• General Rule: Depositary may not change
required for perfection. (It is a real contract,
the way of the deposit
hence, delivery is required for perfection.)
• XPN: If there are circumstances indicating
that the depositor would consent to the
OBLIGATIONS OF THE DEPOSITARY change. This is a situation wherein the
1. Two primary obligations (Art. 1972) depositary would reasonably presume that
a. Safekeeping of the object; the depositor would agree to the change if he
b. Return of the thing when required – even knows of the facts of the situation.
though a specified term or time for such • Requisites
may have been stipulated in the contract. a. The depositary must notify the
• Degree of Care – same diligence as depositor of such change and
he would exercise over his property. b. Must wait for the reply of the
• Reasons: depositor to such change.
i. Essential requisite of judicial • XPN: If the delay of the reply would cause
relation which involves the danger.
depositor’s confidence in his good
faith and trustworthiness; 4. Obligation to collect on the choses in
ii. The presumption that the depositor action deposited (Art. 1975)
took into account the diligence • If the thing deposited should earn interest, the
which the depositary is depositary is under the obligation to:
accustomed with respect to his a. Collect the interest as it becomes
own property. due;
b. Take such steps as may be 7. Liability for loss through fortuitous event
necessary to preserve its value and (Art. 1979)
the right corresponding to it. General Rule: The depositary is not liable for
• The depositary is bound to collect the capital, loss through fortuitous event without his fault.
as well as the interest, when due. XPN:
a. If it is so stipulated;
Contract of rent of safety deposit boxes (Art. b. If he uses the thing without the depositor’s
1975) permission
A contract for the rent of safety deposit boxes is c. If he delays in its return;
not an ordinary contract of lease of things , but a d. If he allows others to use it, even though
special kind of deposit; hence, it is not to be he himself may have been authorized to
strictly governed by the provisions on deposit. use the same.
The prevailing rule in the US is that the relation
between a bank renting out safety deposit boxes Note: Liability for loss without fortuitous event:
and its customer with respect to the contents of Depositary
the box is that of bailor and bailee. • presumed at fault (Art. 1265)
• in possession
5. Obligation not to commingle things if so
stipulated (Art. 1976) 8. Relation between bank and depositor (Art.
• General Rule: The depositary is permitted to 1980)
commingle grain or other articles of the same • Fixed, savings, and current deposits of money
kind and quality. in banks and similar institutions shall be
• Effects: governed by the provisions concerning simple
a. The various depositors of the mingled loan.
goods shall own the entire mass in a. Contract of loan – deposits in banks are
common. really loans because the bank can use the
b. Each depositor shall be entitled to such same for its ordinary
portion of the entire as the amount transactions
deposited by him bears the whole. b. Relation of creditor and debtor – the
• XPN: When there is a stipulation to the relation between a depositor and a bank is
contrary. that of a creditor and a debtor.
6. Obligation not to make use of the things 9. Obligation when the thing deposited is
deposited (Art. 1977) closed and sealed (Art. 1981)
• General Rule: Deposit is for safekeeping of The depositary has the obligation to:
the subject matter and not for its use. a. return the thing deposited when delivered
• XPN: closed and sealed in the same condition;
a. Expressly authorized by the depositor; b. pay for damages should the seal or lock be
b. Such use is necessary for its broken through his fault, which is
preservation but limited for the purpose presumed unless proven
only. otherwise;
• Effect of unauthorized use: Liability for c. Keep the secret of the deposit when the
damages seal or lock is broken, with or without his
• Effects of authorized use: (Art. 1978) fault.
a. If the thing deposited is non-
consumable: 10. When depositary justified in opening
• General Rule: The contract loses closed and sealed subject matter (Art. 1982)
the character of a deposit and a. The depositary is presumed authorized to
acquires that of a commodatum do so if the key has been delivered to him;
despite the fact that the parties may b. When the instructions of the depositor as
have denominated it as a deposit. regards the deposit cannot be executed
• XPN: Safekeeping is still the without opening the box or receptacle.
principal purpose of the contract. (Necessity)
b. If the thing deposited is money or other
consumable thing: 11. Obligation to return products,
• General Rule: Converts the accessories and accessions (Art. 1983)
contract into a simple loan or
mutuum. 12. Obligation to pay interest on sums
• XPN: Safekeeping is still the converted for personal use (Art. 1983)
principal purpose of the contract, but
it becomes an irregular deposit. 13. The depositary who receives the thing in
Bank deposits are in the nature of deposit cannot require that the depositor
irregular deposits but they are really prove his ownership over the thing (Art.
loans governed by the law on loans. 1984)
14. Where third person appears to be the 18. Obligation to return upon the time of
owner (Art. 1984) return. (Art. 1988)
The depositary may be relieved from liability • General Rule: The thing deposited must be
when: returned to the depositor UPON DEMAND,
a. He advised the true owner of the thing of even though a specified period or time for
the deposit. such return may have been fixed.
b. If the owner, inspite of such information, • XPN:
does not claim it within the period of one a. When the thing is judicially attached
month (30 days) while in the depositary’s possession
b. When notified of the opposition of a third
15. Obligation of the depositary when there person to the return or the removal of the
are two or more depositors. (Art. 1985) thing deposited.
a. Divisible thing and joint depositors – each
one of the depositors can demand only his 19. Right of the depositary to return the thing
share proportionate thereto. deposited. (Art. 1989)
b. Indivisible thing and solidary depositors – • Note: in this case, it is the depositary who is
rules on active solidarity returning the deposit WITH OR WITHOUT
General Rule: The depositary may return THE DEMAND of the depositor
the thing to any one of the solidary • General Rule: The depositary may return the
depositors thing deposited notwithstanding that a period
XPN: When a demand, judicial or has been fixed for the deposit if:
extrajudicial, for its return has been made a. The deposit is gratuitous;
by one of them in which case delivery b. The reason is justifiable.
should be made to him.
c. Return to one of the depositors stipulated - Remedy if depositor refuses to receive the
if by stipulation, the thing should be thing
returned to one of the depositors, the The depositary may deposit the thing at the
depositary is bound to return it only to the disposal of the judicial authority.
person designated although he has not
made any demand for its return. XPN: When the deposit is for a valuable
consideration, the depositary has no right to
16. Obligation to return to the person to return the thing before the expiration of the time
whom return must be made. (Art. 1986) designated even if he should suffer
a. The depositary is obliged to return the inconvenience as a consequence.
thing deposited, when required, to:
• The depositor; 20. Depositary’s liability in case of loss by
• To his heirs or successors; or force majeure or government order. (Art.
• To the person who may have been 1990)
designated in the contract. • Depositary is not liable in cases of loss by
b. If the depositor was incapacitated at the force majeure or by government order.
time of making the deposit, the property However, he has the duty to deliver to the
must be returned to: depositor money or another thing he receives
• His guardian or administrator; in place of the thing.
• To the depositor himself should he
acquire capacity. 21. Liability in case of alienation of the
depositary’s heir. (Art. 1991)
c. Even if the depositor had capacity at the
time of making the deposit but he
When alienation is done in GOOD FAITH:
subsequently loses his capacity
a. Return the value of the thing deposited
during the deposit, the thing must be
b. Assign the right to collect from the buyer.
returned to his legal representative.
• The heir does not need to pay the
actual price of the thing deposited.
17. Obligation to return at the place of return
When alienation is done in BAD FAITH:
(Art. 1987) – same as the general rule of law
a. Liable for damages;
regarding the place of payment. (Art. 1251)
b. Pay the actual price of the thing deposited.
• General Rule: At the place agreed upon by
the parties, transportation expenses shall be
22. Depositary may retain the thing in pledge
borne by the depositor.
until the full payment of what may be due
• XPN: In the absence of stipulation, at the
him by reason of the deposit. (Art. 1994)
place where the thing deposited might be
The thing retained serves as security for the
even if it should not be the same place where
payment of what may be due to the depositary
the original deposit was made.
by reason of the deposit. (see Art. 1965, 1992,
1993).
OBLIGATIONS OF THE DEPOSITOR 2. It takes place on the occasion of any

1. Obligation to pay expenses of preservation. calamity, such as fire, storm, flood,
(Art. 1992) pillage, shipwreck, or other similar
2. Obligation to pay losses incurred due to events. (deposito miserable)
character of thing deposited. (Art. 1993) • There must be a causal relation
• General Rule: The depositary must be between the calamity and the
reimbursed for loss suffered by him constitution of the deposit.
because of the character of the thing • Possession of movables passes from
deposited. one person to another by accident or
• XPN: fortuitously through force of
a. Depositor was not aware of the circumstance, and which law imposes
danger; upon the recipient the obligations of a
b. Depositor was not expected to know bailee
the dangerous character of the • Article 2168 – quasi-contract, owner of
thing; property saved bound to pay just
c. Depositor notified the depositary of compensation
such dangerous character;
d. Depositary was aware of the danger 3. Made by passengers with common
without advice from the depositor. carriers. (Art. 1754)
3. Effect of death of depositor or depositary. as to those baggage the passengers or their
(Art. 1995) agents carry
a. Deposit gratuitous – death of either of
the depositor or depositary 4. Made by travelers in hotels or inns. (Art.
1998)
extinguishes the deposit (personal in
Before keepers of hotels or inns may be held
nature). By the word “extinguished,”
responsible as depositaries with regard to the
the law really means that the
effects of their guests, the following must
depositary is not obliged to
concur:
continue with the contract of deposit.
b. Deposit for compensation – not
Elements
extinguished by the death of either
a. They have been previously informed about
party.
the effects brought by the guests; and
b. The latter have taken the precautions
RIGHT OF RETENTION (Art. 1994) prescribed regarding their safekeeping.
• Depositary has a right to retain the thing in
pledge until full payment of what may be due Extent of liability
him by reason of the deposit a. Liability in hotel rooms which come under
• This is an example of pledge created by the term “baggage” or articles such as
operation of law (Art. 2121) clothing as are ordinarily used
• RULE is different in Commodatum, bailee by travelers
has no right of retention except Art 1951 b. Include those lost or damages in hotel
(bailor knows flaws in the thing did not annexes such as vehicles in the hotel’s
advise bailee of such, Art 1944 gives bailee garage.
right to retain the thing until he is
compensated for damages suffered. When hotel-keeper liable: (Art. 2000 – 2002)
Note: Hotelkeeper is liable REGARDLESS of
NECESSARY DEPOSIT vs. VOLUNTARY the amount of care exercised in the following
DEPOSIT cases:
• Voluntary deposit is made by the free will a. The loss or injury to personal property is
of the depositor; caused by his servants or employees as
• In Necessary deposit, this freedom of well as by strangers (Art.
choice is absent; 2000).
b. The loss is caused by the act of a thief or
NECESSARY DEPOSIT (Art. 1996) robber done without the use of arms and
A deposit is necessary when: irresistible force. (Art. 2001)
1. It is made in compliance with a legal Reason: Hotel-keeper is apparently negligent.
obligation;
• Example: Art 586 – deposit with bank When hotel-keeper not liable:
or public institution of bonds or a. The loss or injury is caused by force
instruments of credit payable to order majeure, like flood, fire, theft or robbery by
or bearer given in usufruct when the a stranger (not the hotel-keeper’s servant
usufructuary does not give proper or employee) with the use of firearms or
security for their conservation irresistible force.
XPN: Unless the hotel-keeper is guilty of C. GUARANTY AND

fault or negligence in failing to provide SURETYSHIP
against the loss or injury from this cause.
b. The loss is due to the acts of the guests, GUARANTY
his family, servants, visitors. An accessory contract whereby a person
c. The loss arises from the character of the called the guarantor binds himself to the
things brought into the hotel. creditor to fulfill the obligation of the principal
debtor in case the latter should fail to do
Exemption or Diminution of Liability
The hotel-keeper cannot free himself from Guaranty not presumed (2055)
responsibility by posting notices to the effect Guaranty requires the expression of consent
that he is not liable for the articles brought by on the part of the guarantor to be bound. It
the guest. (Art. 2003) cannot be presumed because of the existence
of a contract or principal obligation.
Limited Liability Stipulation is VOID Guaranty covered by the Statute of Frauds
Any stipulation between the hotel-keeper and (Art. 1403)
the guest whereby the responsibility of the • Guaranty must not only be expressed but
former (as set forth in Art. 1998-2001) is must so be reduced into writing.
suppressed or diminished shall be VOID. (Art. • Hence, it shall be unenforceable by action,
2003) unless the same or some note or
memorandum thereof be in writing, and
Hotel-keeper’s right to retain subscribed by the party charged, or by his
The hotel-keeper has a right to retain the agent; evidence, therefore, of the
things brought into the hotel by the guest, as a agreement cannot be received without the
security for credits on account of: writing, or a secondary evidence of its
a. Lodging; contents.
b. supplies usually furnished to hotel • It need not appear in a public document.
guests.
Obligation
Reason: It is given to hotel-keepers to 1. of the Guarantor – pay or perform the
compensate them for the liabilities imposed obligation if the debtor fails to do.
upon them by law. The right of retention 2. of the Creditor – pay the guarantor the
recognized in this article is in the nature of a compensation stipulated.
pledge created by operation of law.
THE GUARANTOR
Qualifications of a Guarantor
SEQUESTRATION OR JUDICIAL DEPOSIT i. Possesses integrity
When judicial deposit takes place: ii. Has the capacity to bind himself
● Judicial deposit takes place when an iii. Has sufficient property to answer for the
attachment or seizure of property in obligation which he guarantees
litigation is ordered by a court. (Art. 2005) iv. Subject to the jurisdiction of the court of
Nature: Auxiliary to a case pending in court. the place where the obligation is to be
Purpose: To maintain the status quo during complied with
the pendency of the litigation or to insure the
right of the parties to the property in case of a Privileges given to the guarantor
favorable judgment. i. Benefit of excussion
ii. Benefit of division
Depositary of sequestered property:
person appointed by the court. (Art. 2007) Excussion
Obligations: Right of the guarantor to have the properties of
a. To take care of the property with the the debtpr exhausted first before the guarantor
diligence of a good father of the family. can be made liable to the creditor
(Art. 2008)
b. He may not be relieved of his For the benefit of Excussion, the guarantor
responsibility until the litigation is ended must:
or the court so orders. (Art. 2007) i. Set it up against the creditor upon the
latter’s demand for payment from him
Applicable law: The Rules of Court are ii. Point out to the creditor the available
applicable since law on judicial deposit is properties of the debtor in the Philippines
remedial or procedural in nature. (Art. 2009) sufficient to cover the amount of debt.
The guarantor is not entitled to excussion 3. Negligence of the creditor

when: 4. Failure to send notice of default
i. Guarantor has expressly renounced the 5. Death
benefit of excussion 6. Creditor voluntarily accepts immovable or
ii. Guarantor solidarily binds himself with the other property in payment of the debt, even if
principal debtor the creditor should afterwards lose the same
iii. If the debtor is insolvent through eviction.
iv. Principal debtor has absconded or cannot
be sued within the Philippines GUARANTY VS. WARRANTY
v. When it may be presumed that execution
will not result in the satisfaction of the GUARANTY WARRANTY
judgment credit
Contract by which a An undertaking that the
vi. Guarantor failed to point out leviable person is bound to title, quality, or quantity
properties of the debtor
another for the of the subject matter of
fulfillment of a promise a contract is what it has
Benefit of division
or engagement of a been represented to
Requisites:
third Party. be, and relates to some
i. There are several guarantors
agreement made
ii. They guaranteed only one debtor
ordinarily by the party
iii. One debt who makes the
warranty.
Division is not available when:
i. Waived by the guarantor
ii. Guarantor solidarily binds himself with the SURETYSHIP
principal debtor Suretyship is a contract where a person binds
iii. the debtor is insolvent himself solidarily with the principal debtor. (Art.
iv. Principal debtor has absconded 2047 par. 2)
v. When it may be presumed that execution
will not result in the satisfaction of the Nature and extent of suretyship
judgment credit i. Primarily and absolutely liable
ii. Pays if debtor does not pay
Continuing guaranty iii. Insurer of the debt
i. Not limited to a single transaction
ii. Contemplates a future course of dealing Nature of surety’s undertaking
covering a series of transactions 1. Liability is contractual and accessory but
iii. Prospective in application. direct:
2. Liability is limited by terms of contract
Rights of Guarantor 3. Liability arises only if principal debtor is
1. before payment held liable
a. to receive compensation a. In the absence of collusion, the surety is
b. to demand relief from the guaranty against bound by a judgment against the
creditor’s action principal event though he was not a party
c. to demand security against debtor’s to the proceedings;
insolvency b. The creditor may sue, separately or
2. after payment together, the principal debtor and the
a. to seek reimbursement surety;
b. to be subrogated to the rights of the c. A demand or notice of default is not
creditor required to fix the surety’s liability
Exception: Where required by the
Debtor must indemnify guarantor for: provisions of the contract of suretyship
i. Total amount of debt NOTE: Surety is not entitled to
ii. Legal interests exhaustion unlike guarantors
iii. Expenses incurred after notifying the 4. Undertaking is to creditor, not to debtor
debtor that payment had been demanded The surety makes no covenant or
from him agreement with the principal that it will
iv. Damages fulfill the obligation guaranteed for the
benefit of the principal. The surety’s
EXTINGUISHMENT OF GUARANTY undertaking is that the principal shall fulfill
1. Same grounds as the modes of his obligation and that the surety shall be
extinguishment for ordinary obligation relieved of liability when the obligation
(Payment, Loss, Condonation, Merger, secured is performed.
Compensation, Novation Exception: Unless otherwise expressly
2. Extension of payment provided.
NOTE: Surety is not entitled to notice of

Only binds himself to Undertakes to pay if the
principal’s default
pay if the principal principal does not pay,
5. Prior demand by the creditor upon principal
cannot or unable to without regard to his
not required Surety is not exonerated by
pay. ability to do so.
neglect of creditor to sue principal.
Insurer of the solvency Insurer of the debt.
SPS. ONG vs. PCIB | of the debtor.
G.R. No. 160466, January 17, 2005
• There is a sea of difference in the rights and Does not contract that Pay the creditor without
liabilities of a guarantor and a surety. the principal will pay, qualification if the
A guarantor insures the solvency of the but simply that he is principal debtor does
debtor while a surety is an insurer of the debt able to do so. not pay. Hence, the
itself. A contract of guaranty gives rise to responsibility or
a subsidiary obligation on the part of the obligation assumed by
guarantor. It is only after the creditor has the surety is greater or
proceeded against the properties of the more onerous than that
principal debtor and the debt remains of a guarantor.
unsatisfied that a guarantor can be held liable
to answer for any unpaid amount. This is the
D. REAL ESTATE MORTGAGE
principle of excussion
• In suretyship contract, however, the benefit of (Arts. 2124-2131)
excussion is not available to the surety as he ‘Contract of Mortgage’ defined
is principally liable for the payment of the It is a contract whereby the debtor secures to
debt. As the surety insures the debt itself, he the creditor the fulfillment of a principal
obligates himself to pay the debt if the obligation, specially subjecting to such security
principal debtor will not pay, regardless of immovable property or real rights over
whether or not the latter is financially capable immovable property in case the principal
to fulfill his obligation. Thus, a creditor can obligation is not complied with at the time
go directly against the surety although the stipulated.
principal debtor is solvent and is able to pay
or no prior demand is made on the principal OBJECTS OF REAL MORTGAGE
debtor. A surety is directly, equally and 1. Immovables
absolutely bound with the principal debtor for 2. Alienable real rights in accordance with the
the payment of the debt and is deemed as an laws, imposed upon immovables
original promissor and debtor from the • future property cannot be object of
beginning. mortgage
IMPORTANT POINTS
GUARANTY VS. SURETYSHIP • As a general rule, the mortgagor retains
possession of the property, because by the
GUARANTY SURETYSHIP
mortgage, the debtor merely subjects the
Liability depends upon Assumes liability as a property to a LIEN but ownership thereof is
an independent regular party to the not parted with.
agreement to pay the Undertaking. • Mortgagor may deliver said property to the
obligation if the primary mortgagee without altering the nature of the
debtor fails to do so. contract of mortgage.
• It is not an essential requisite that the
Engagement is a Charged as an original principal of the credit bears interest, or that
collateral undertaking. Promisor. the interest as compensation for the use of
the principal and the enjoyment of its fruits be
Secondarily liable – he Primarily liable – in the form of a certain percent thereof.
contracts to pay if, by undertakes directly for • The interest may be in the form of fruits of the
the use of due the payment without mortgaged property, without the contract’s
diligence, the debt reference to the losing its nature of a contract of mortgage.
cannot be paid. solvency
of the principal, and is KINDS OF MORTGAGE
so responsible at once 1. Voluntary – one which is agreed to
the latter makes between the parties or constituted by the
default, without any will of the owner of the property on which it
demand by is created.
the creditor upon the 2. Legal – one required by law to be
principal whatsoever or executed in favor of certain persons (Arts.
any notice of default. 2125, 2083)
3. Equitable – one which, although it lacks FEBTC clearly establishes PDCP' s intent to
the proper formalities of a mortgage shows mortgage all of the four properties in favor of
the intention of the parties to make the FEBTC to secure Sengkon's obligation under
property as a security for a debt (provisions the Credit Line. The Court notes that the
governing equitable mortgage - arts 1365, principal debtor, Sengkon, has several
1450, 1454, 1602, 1603, 1604 and 1607) obligations under its Omnibus Line
corresponding to the several credit sub-
ESSENTIAL REQUISITES OF MORTGAGE facilities made available to it by FEBTC. As
1. constituted to secure the fulfillment of a found by the trial court, PDCP intended to be
principal obligation bound only for Sengkon' s availments under
2. mortgagor is the absolute owner of the the Credit Line sub-facility and not for just any
thing mortgaged
of Sengkon's availments. Hence, it is in this
3. the persons constituting mortgage have
sense that the phrase "partial security" should
free disposal of their property, and in the
be logically understood.
absence thereof, that they be legally
authorized for the purpose
4. cannot exist without a valid obligation
COCA-COLA BOTTLERS PHILS., INC v.
5. when the principal obligation becomes SPOUSES EFREN AND LOLITA SORIANO |
due, the thing in which the mortgage G.R. No. 211232. April 11, 2018
consists may be alienated for the payment We stress that the registration of a REM deed
to the creditor. is not essential to its validity. The law is clear
6. appears in a public document duly on the requisites for the validity of a mortgage,
recorded in the Registry of Property to be to wit:
validly constituted Art. 2085. The following requisites are
essential to the contracts of pledge and
PUBLIC INSTRUMENT AND RECORDING mortgage:
• It is indispensable in order that a mortgage (1) That they be constituted to secure the
may be validly constituted that it appears in a fulfillment of a principal obligation;
public instrument duly recorded in the (2) That the pledgor or mortgagor be the
Registry of Property absolute owner of the thing pledged or
• If in private instrument – no valid mortgage is mortgaged;
constituted, but it is still binding upon the (3) That the persons constituting the pledge or
parties. mortgage have the free disposal of their
property, and in the absence thereof, that
Article 2125. In addition to the requisites stated they be legally authorized for the purpose.
in article 2085, it is indispensable, in order that a
mortgage may be validly constituted, that the Third persons who are not parties to the
document in which it appears be recorded in the principal obligation may secure the latter by
Registry of Property. If the instrument is not pledging or mortgaging their own property.
recorded, the mortgage is nevertheless binding
between the parties. The persons in whose favor
In relation thereto, Article 2125 provides:
the law establishes a mortgage have no other
Article 2125. In addition to the requisites stated
right than to demand the execution and the
in Article 2085, it is indispensable, in order that
recording of the document in which the
a mortgage may be validly constituted, that the
mortgage is formalized.
document in which it appears be recorded in
PARADIGM DEVELOPMENT CORPORATION the Registry of Property. If the instrument is
OF THE PHILIPPINES v. BANK OF THE not recorded, the mortgage is nevertheless
PHILIPPINE ISLANDS | G.R. No. 191174. June binding between the parties
7, 2017
The registration of the REMs, even if contrary to Thus, as between the parties to a mortgage,
the supposed intent of the parties, did not affect the non-registration of a REM deed is
the validity of the mortgage contracts immaterial to its validity. In the case of
Even assuming that the parties indeed agreed to Paradigm Development Corporation of the
register only one of the two REMs, the Philippines, v. Bank of the Philippine Islands,
subsequent registration of both REMs did not the mortgagee allegedly represented that it will
affect an already validly executed REM if there not register one of the REMs signed by the
was no other basis for the declaration of its mortgagor. In upholding the validity of the
nullity. That the REMs were intended merely as questioned REM between the said parties, the
"partial security" does not make PDCP's Court ruled that "with or without the registration
argument more plausible because as aptly of the REMs, as between the parties thereto,
observed by the CA, the PDCP's act of the same is valid and [the mortgagor] is bound
surrendering all the titles to the properties to thereby."
In order to constitute a legal mortgage, it must EXTENT OF MORTGAGE

be executed in a public document, besides • Not limited to the property itself but also
being recorded. A provision in a private extends to all its accessions, improvements,
growing fruits and rents or income (Art. 2102)
document, although denominating the
as well as to proceeds of insurance should
agreement as one of mortgage, cannot be the property be destroyed, or expropriation
considered as it is not susceptible of inscription value of the property should it be
in the property registry. A mortgage in legal form expropriated.
is not constituted by a private document, even if • TO EXCLUDE accessions, accessories and
such mortgage be accompanied with delivery of improvements subsequently introduced, there
must be a stipulation to that effect
possession of the mortgage property. Besides,
by express provisions of Section 127 of Act No. STIPULATION FORBIDDING ALIENATION IS
496, a mortgage affecting land, whether VOID
registered under said Act or not registered at all, ARTICLE 2130 – ANY STIPULATION
is not deemed to be sufficient in law nor may it PROHIBITING THE OWNER FROM
be effective to encumber or bind the land unless ALIENATING THE MORTGAGED PROPERTY
SHALL BE VOID
made substantially in the form therein
• Mortgagee can simply withhold consent
prescribed. It is required, among other things, • If alienated, transferee is bound to respect the
that the document be signed by the mortgagor encumbrance which is a lien on the property
executing the same, in the presence of two
witnesses, and acknowledged as his free act FORECLOSURE OF MORTGAGE
and deed before a notary public. A mortgage ‘Foreclosure’ defined
• it is the remedy available to the mortgagee by
constituted by means of a private document
which he subjects the mortgaged property to
obviously does not comply with such legal the satisfaction of the obligation to secure
requirements. which the mortgage was given.
The defective notarization of the REM KINDS OF FORECLOSURE

agreement merely strips it of its public 1. Judicial – governed by Rule 68 of the
character and reduces it to a private Rules of Court
2. Extrajudicial – governed by Act No. 3135
document.
Thus, in order to determine the validity of the JUDICIAL FORECLOSURE
REM in this case, the REM agreement shall be • There is court intervention;
subject to the requirement of proof under • Decisions are appealable;
Section 20, Rule 132, viz: • Order of the court cuts off all rights of the
parties impleaded;
• There is equity of redemption except on
Section 20. Proof of private document. - Before
banks which provides for a right of
any private document offered as authentic is redemption;
received in evidence its due execution and • Period of redemption starts from the finality of
authenticity must be proved either: the judgment until order of confirmation;
a) By anyone who saw the document executed • No need for a special power of attorney in the
or written; or contract of mortgage.
b) By evidence of the genuineness of the
EXTRAJUDICIAL FORECLOSURE
signature or handwriting of the maker. • No court intervention;
• Not appealable, it is immediately executory;
EFFECT OF MORTGAGE • Foreclosure does not cut off right of all parties
1. creates real rights, a lien inseparable from involved;
the property mortgaged, enforceable against • There is right of redemption;
• Period to redeem starts from date of
the whole world
registration of certificate of sale;
2. creates merely an encumbrance – mortgage • Special power of attorney in favor of
does not involve a transfer, cession or mortgagee is needed in the contract.
conveyance of property but only constitutes
a lien thereon. NATURE OF JUDICIAL FORECLOSURE
A mere mortgagee cannot eject an occupant of PROCEEDINGS
the property mortgaged 1. quasi in rem action
2. foreclosure is only the result or incident of
the failure to pay debt
3. survives death of mortgagor
NATURE OF POWER OF FORECLOSURE BY What is clearly provided, however, is that a

EXTRAJUDICIAL SALE mortgage debtor is given the opportunity to
1. conferred for mortgagee’s protection redeem the foreclosed property within the term
2. an ancillary stipulation of one year from and after the date of sale. In
3. a prerogative of the mortgagee the case at bar, other than the mere inadequacy
of the bid price at the foreclosure sale,
Note: Stipulation of upset price in mortgage respondent did not allege any irregularity in the
contract is void. foreclosure proceedings nor did she prove that a
better price could be had for her property under
RIGHT OF MORTGAGEE TO RECOVER the circumstances.
DEFICIENCY
1. Mortgagee is entitled to recover deficiency Thus, even if we assume that the valuation of
2. If the deficiency is embodied in a the property at issue is correct, we still hold that
judgment, it is referred to as deficiency the inadequacy of the price at which it was sold
judgment. at public auction does not invalidate the
3. Action for recovery of deficiency may be foreclosure sale.
filed even during redemption period.
4. Action to recover prescribes after 10 years Moreover, we fail to see any unjust enrichment
from the time the right of action accrues resulting from upholding the validity of the
foreclosure sale and of the right of the petitioner
EFFECT OF INADEQUACY OF PRICE IN to collect any deficiency from respondent.
FORECLOSURE SALE Unjust enrichment exists when a person unjustly
1. Where there is right to redeem retains a benefit to the loss of another, or when
General Rule: Inadequacy of price is a person retains money or property of another
immaterial because the judgment debtor against the fundamental principles of justice,
may redeem the property equity and good governance. As discussed
XPN: the price is so inadequate as to shock above, there is a strong legal basis for
the conscience of the court taking into petitioners claim against respondent for the
consideration the peculiar circumstances balance of her loan obligation.
2. Property may be sold for less than its fair
market value upon the theory that the lesser REDEMPTION
the price the easier for the owner to redeem ‘Redemption’ defined
3. The value of the mortgaged property has no it is a transaction by which the mortgagor
bearing on the bid price at the public auction, reacquires or buys back the property which may
provided that the public auction was have passed under the mortgage or divests the
regularly and honestly conducted property of the lien which the mortgage may
have created.
WAIVER OF SECURITY BY CREDITOR
1. Mortgagee may waive right to foreclose his KINDS OF REDEMPTION
mortgage and maintain a personal action 1. EQUITY OF REDEMPTION
for recovery of the indebtedness ‘Equity of Redemption’ defined
2. Mortgagee cannot have both remedies right of the mortgagor to redeem the mortgaged
property after his default in the performance of
Note: Foreclosure retroacts to the date of the conditions of the mortgage but before the
registration of mortgage sale of the mortgaged property or confirmation of
sale; *****applies to judicial foreclosure of real
STIPULATION OF UPSET PRICE OR “TIPO” mortgage
A stipulation of minimum price at which the
property shall be sold to become operative in the 2. RIGHT OF REDEMPTION
event of a foreclosure sale at public auction is “Right of Redemption’ defined
NULL and VOID. right of the mortgagor to redeem the property
within a certain period after it was sold for the
BPI VS. REYES, G.R. No. 182769, February 1, satisfaction of the debt; applies only to
2012 extrajudicial foreclosure of real mortgage
It bears also to stress that the mode of forced
sale utilized by petitioner was an extrajudicial Note: the right of redemption, as long as within
foreclosure of real estate mortgage which is the period prescribed, may be exercised
governed by Act No. 3135, as amended. An irrespective of whether or not the mortgagee has
examination of the said law reveals nothing to subsequently conveyed the property to some
the effect that there should be a minimum bid other party (Sta. Ignacia Rural Bank, Inc v. CA,
price or that the winning bid should be equal to 230 SCRA 513 [1994])
the appraised value of the foreclosed property or
to the amount owed by the mortgage debtor.
PERIOD OF REDEMPTION
1. Extra-judicial (Act No. 3135) QUESTION
a. natural person – 1 year from registration of A borrowed from B money. As security, he
the certificate of sale with Registry of Deeds
delivered the property so that B may use
b. juridical person – same rule as natural
person, 1 year the fruits. But no interest was mentioned
and it was not stated that the fruits would
If Mortgagee is PNB, a bank or banking institution: be applied to the interest first and then to
a. Natural Person – 1 year from registration of the principal. What kind of contract is this?
the certificate of sale with Registry of Deeds
b. Juridical Person – 3 months (90 days) after SUGGESTED ANSWER
foreclosure or before registration of
A real mortgage and not an antichresis
certificate of foreclosure whichever is earlier
(Sec. 117 of General Banking Law) because it was not written in the contract
that the creditor acquires the right to
2. Judicial receive the fruits of the property with the
before confirmation of the sale by the court (only obligation to apply them to the payment of
equity of redemption) interest, if any is due, and then to the
XPN: Mortgagee is PNB, a bank or banking principal of his credit.
institution.
Act Nos. 2247 or 2938 and General Banking Antichretic Creditor cannot acquire
Law property by Prescription
confer right of the mortgagor to redeem the An antichretic creditor cannot acquire the
property sold on foreclosure after confirmation by property by prescription as he is not a
the court of the foreclosure sale – which right possessor in the concept of an owner but a
may be exercised by the following: mere holder placed in possession of the land
a. Natural Person - within a period of one by the owner, hence, their possession cannot
year, counted from the date of registration serve as a title for acquiring dominion over the
of the certificate of sale in the Registry of property. (Ramirez vs. CA)
Property.
b. Juridical Person – within a period of 3 Measurement of Application to Interest and
months after the foreclosure sale or until Principal
the registration of the certificate of sale,
The actual market value of the fruits at the
which ever comes first.
time of the application thereof
E. ANTICHRESIS General Rule: the amount of the principal and
of the interest shall be specified in writing;
Contract of Antichresis’ defined
otherwise, the contract of antichresis shall be
The creditor acquires the right to receive the
void.
fruits of an immovable of his debtor, with the
obligation to apply them to the payment if the
interest, if owing, and thereafter to the principal Effect of a void antichresis to a principal
of his credit. obligation
• generally, it will have no effect as it is only
Kinds of Fruits an accessory contract
1. Natural fruits - the spontaneous products • even if antichresis is void, the principal
of the soil, and the young and other obligation may still be valid
products of animals.
2. Industrial fruits - those produced by Obligation of the Creditor
lands of any kind through cultivation or General Rule:
labor. The creditor is obliged:
3. Civil fruits - rents of buildings, the price of 1) to pay the taxes the charges upon the
leases of lands and other property and the estate
amount of perpetual or life annuities or ○ XPN: unless there is a stipulation
other similar income. to the contrary
2) to bear the expenses necessary for the
Characteristics of an Antichresis preservation and repair
1. Accessory Contract
2. Gives a real right
Note: the sums spent to pay taxes and
3. Formal Contract
expenses for the preservation and repair of
the property shall be deducted from the fruits.
General Rule: A contract of antichresis must be
in writing. Otherwise, it is void.
Effect if Creditor does not pay the proper

taxes
the debtor will be prejudiced and creditor shall
be liable for damages to the debtor
Insufficient Fruits
creditor shall pay for the taxes and charges for
the use of fruits even if the fruits are insufficient
Debtor’s reacquisition of the enjoyment of

the property
when the debtor has paid totally what he owes to
the creditor
Creditor to be exempted from payment of

taxes and necessary repairs (obligations)
General Rule: Creditor may compel the debtor

to enter again upon the enjoyment of the
property to be exempt from payment of taxes
and necessary repairs
XPN: when there is a stipulation to the contrary
Creditor entitled to reimbursement

the antichretic creditor is entitled to be
reimbursed for:
a. his expenses for machinery
b. other improvements on the land
c. for sums paid as land taxes
Kinds of reimbursement to the creditor

a. money
b. may come from fruits
Article 2137. The creditor does not acquire the

ownership of the real estate for non-payment of
the debt within the period agreed 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. (1884a)
Note: Art. 2137 prohibits Pactum Commissorium
Pactum Commissorium defined

• Automatic appropriation by the creditor of the
thing pledged or mortgaged upon the failure
of the debtor to pay the principal obligation.
• The essence of pactum commissorium is that
ownership of the security will pass to the
creditor by the mere default of the debtor.
V. COMPROMISE
‘Compromises’ defined What Governs The Duration And Terms Of
It is a contract whereby the parties, by making The Suspension
reciprocal concessions, avoid a litigation or It shall be governed by such provisions of the
put an end to one already commenced. rules of court as the Supreme Court shall
[Article 2028] promulgate. Said rules of court shall likewise
provide for the appointment and duties of
Characteristics of a Compromise amicable compounders. [Article 2030]
a. Consensual
b. Reciprocal Mitigation of Damages
c. Nominate The courts may mitigate the damages to be paid
by the losing party who has shown a sincere
d. Onerous
desire for compromise. [Article 2031]
e. Accessory (in the sense that a prior
conflict is presupposed)
When Court Approval is Essential
f. Once accepted, it is binding on the The court’s approval is necessary in
parties, provided there is no vitiated compromises entered into by:
consent. a. Guardians
g. It is the settlement of a controversy b. Parents
principally, and is, but merely c. Absentee’s representatives or
incidentally, the settlement of a claim. Administrators
d. Executors of decedents’ estates. [Article
Kinds of Compromises 2032]
1. Judicial - to end a pending litigation
2. Extrajudicial - to prevent a litigation from Rule for Compromise Entered Into by
arising Juridical Persons
The form and the requisites for alienation of
Duty of the Court to Persuade Litigants to property must be observed. [Article 2033].
Compromise
The court shall endeavor to persuade the Compromise Upon Civil Liability Arising
litigants in a civil case to agree upon some fair From An Offense
compromise. [Article 2029] There may be a compromise upon the civil
liability arising from an offense, but such
Rationale: Litigation must, if possible, be compromise shall not extinguish the public
action for the imposition of the legal penalty.
avoided or minimized.
[Article 2034]
Right of Attorney to Compromise for His
General Rule: If a crime has been committed,
Client
there can be a compromise on the civil liability
A “special authority” is required before an but not generally on the criminal liability.
attorney can compromise in behalf of his Rationale: Because the social and public
client. interest demands the punishment of the
offender.
Forms of Authority
1. Writing When Compromise is Allowed
2. Oral - This must be duly established by If it arises under the Internal Revenue Code or
evidence other than the self-serving any other law administered by the Bureau of
assertion of counsel himself that such Internal Revenue.
authority had been given to him orally.
Questions on Which There Can Be No Valid
Suspension of Civil Action or Proceeding Compromise
Every civil action or proceeding shall be 1. The civil status of persons;
suspended: 2. The validity of a marriage or a legal
1. If willingness to discuss a possible separation;
compromise is expressed by one or both 3. Any ground for legal separation;
parties; 4. Future support;
2. If it appears that one of the parties, 5. The jurisdiction of courts;
6. Future legitime. [Article 2035]
before the commencement of the action
or proceeding, offered to discuss a
General Rule: Such questions will render the
possible compromise but the other party
compromise void.
refused the offer.
What a Compromise Can Deal With Ignorance of a judgment which may be revoked
a. those objects definitely stated therein or set aside is not a valid ground for attacking a
b. those included implicitly — according to compromise. [Article 2040]
the terms stated [Article 2036]
Remedy if Compromise Agreement Is Not
General Renunciation Of Rights Fulfilled
Refer only to those that are connected with the If one of the parties fails or refuses to abide by
dispute which was the subject of the the compromise, the other party may either:
compromise. a. Enforce the compromise; or
b. Regard the compromise as rescinded and
Res Judicata Effect of a Compromise insist upon his original demand. [Article
General Rule: A compromise has upon the 2041]
parties the effect and authority of res judicata.
XPN: There shall be no execution except in Recovery of Damages
compliance with a judicial compromise. [Article In either case, damages may be recovered if
2037] there should be additional injury caused by
failure to abide by the terms of the compromise.
Judgment On Compromise Generally Not
Appealable No Necessity for Judicial Rescission
General Rule: A judgment on compromise is not There is no necessity for a judicial declaration of
generally appealable and may therefore be rescission, for the party aggrieved may “regard”
immediately executory. the compromise agreement as already
XPN: Unless a motion is filed to set aside the “rescinded.”
error on the ground of vitiated consent, in which
case an appeal may be taken from a court order
denying the motion to set aside the compromise.
Effect of A Compromise In Which There is

Mistake, Fraud, Violence, Intimidation, Undue
Influence, or Falsity of Documents
Will be subject to the provisions of Article 1330
of the Civil Code:
Article 1330. A contract where consent is given
through mistake, violence, intimidation, undue
influence, or fraud is voidable.
Rule In Setting Up A Mistake Of Fact

One of the parties cannot set up a mistake of
fact as against the other if the latter, by virtue of
the compromise has withdrawn from a litigation
already commenced. [Article 2038]
Discovery of Documents Referring to Matters

Compromised Upon
General Rule: The discovery of documents
referring to one or more but not to all of the
questions settled shall not itself be a cause for
annulment or rescission of the compromise.
XPN: Unless said documents have been
concealed by one of the parties. [Article 2039]
When May A Compromise Be Annulled or

Rescinded
If it refers only to one thing to which one of the
parties has no right, as shown by the newly-
discovered documents.
Final Judgment Prevails Compromise

If after a litigation has been decided by a final
judgment, a compromise should be agreed
upon, either or both parties being unaware of the
existence of the final judgment, the compromise
may be rescinded.
VI. QUASI-CONTRACTS
A. Negotiorum Gestio
B. Solutio Indebiti
Article 2142. Certain lawful, voluntary and A. NEGOTIORUM GESTIO

unilateral acts give rise to the juridical relation
of quasi-contract to the end that no one shall ‘Negotiorum gestio’ defined
be unjustly enriched or benefited at the • It is the voluntary administration of the
expense of another. property, business or affairs of another,
without his consent or authority, that creates
Article 2143. The provisions for quasi- an obligation for reimbursement for the
contracts in this Chapter do not exclude other necessary expenses the gestor had spent.
quasi-contracts which may come within the • Whoever voluntarily takes charge of the
purview of the preceding article. agency or management of the business or
property of another, without any power from
‘Quasi-Contracts’ defined the latter, is obliged to continue the same until
• Are lawful, voluntary, and unilateral acts the termination of the affair and its incidents,
which generally require a person to or to require the person concerned to
reimburse or compensate another in substitute him, if the owner is in the position
to do so.
accordance with the principle that no one
• (Arts. 2144 - 2153 NCC)
shall be unjustly enriched or benefited at
the expense of another. [Article 2142]
Requisites
• Quasi-contract may be described as a a. There must be voluntary assumption of
juridical relation that the law creates on the agency or management by the gestor;
basis of certain VOLUNTARY and b. Business or property must be neglected or
UNILATERAL, but LAWFUL, acts of a abandoned;
person, in the interest of equity and justice c. Agency/management must not be
such as the avoidance of what could authorized by owner either expressly or
otherwise be a situation of unjust impliedly;
enrichment. d. Assumption of agency/management must
• Quasi-contracts are either nominate be made in good faith.
(negotiorum gestio and solution indebiti) or • Ratification of the management by the
innominate (Articles 2164-2175 NCC) owner of the business produces the
effects of an express agency, even if the
Bases for Quasi-Contracts business may not have been
1. No one must unjustly enrich himself at successful.
another’s expense; • Responsibilities of the Officious
2. If one benefits, he must reimburse; Manager – see Arts 2144, 2145, 2147,
3. Justice and equity. 2148, 2152, 2146)
• Responsibilities of the Owner – see Arts
Kinds of Quasi-Contracts 2150, 2151, 2152
1. Negotiorum Gestio – voluntary
Article 2145. The officious manager shall
management of the property or affairs of
perform his duties with all the diligence of a
another without the knowledge or
good father of a family, and pay the damages
consent of the latter. (Art. 2144-2153) which through his fault or negligence may be
2. Solutio Indebiti – juridical relation which suffered by the owner of the property or
is created when something is received business under management. The courts may,
when there is no right to demand it and it however, increase or moderate the indemnity
was unduly delivered by mistake. (Art. according to the circumstances of each case.
2154-2163)
3. Other cases (Art. 2164-2175) Article 2146. If the officious manager delegates
to another person all or some of his duties, he
MC ENGINEERING VS. COURT OF shall be liable for the acts of the delegate,
APPEALS without prejudice to the direct obligation of the
G.R. No. 104047, April 3, 2002 latter toward the owner of the business. The
Conditions for Unjust Enrichment: responsibility of two or more officious managers
1. A person is unjustly benefited; and shall be solidary, unless the management was
2. Such benefit is derived at another’s assumed to save the thing or business from
expense or damage. imminent danger.
Article 2147. The officious manager shall be

BAR QUESTION
liable for any fortuitous event:
(1) If he undertakes risky operations which the
owner was not accustomed to embark upon;
(2) If he has preferred his own interest to that of In fear of reprisals from lawless elements
the owner; besieging his barangay, X abandoned his
(3) If he fails to return the property or business fishpond, fled to Manila and left for Europe.
after demand by the owner; Seeking that the fish in the fishpond were
(4) If he assumed the management in bad faith. ready for harvest, Y, who is in the business
of managing fishponds on a commission
Article 2148. Except when the management basis, took possession of the property,
was assumed to save property or business from harvested the fish and sold the entire
imminent danger, the officious manager shall be
harvest to Z.
liable for fortuitous events:
(1) If he is manifestly unfit to carry on the Thereafter, Y borrowed money from W and
management; used the money to buy new supplies of fish
(2) If by his intervention he prevented a more fry and to prepare the fishpond for the next
competent person from taking up the crop.
management.
a) What is the Juridical relation between X
Article 2150. Although the officious and Y during X's absence?
management may not have been expressly
ratified, the owner of the property or business b) Upon the return of X to the barangay,
who enjoys the advantages of the same shall be what are the obligations of Y to X as
liable for obligations incurred in his interest, and
regards the contract with Z?
shall reimburse the officious manager for the
necessary and useful expenses and for the
damages which the latter may have suffered in c) Upon X's return, what are the obligations
the performance of his duties. The same of X as regards Y's contract with W?
obligation shall be incumbent upon him when
the management had for its purpose the d) What legal effects will result if X
prevention of an imminent and manifest loss, expressly ratifies Y's management? What
although no benefit may have been derived. would be the obligations of X in favor of Y?
Explain all your answers.
Article 2151. Even though the owner did not
derive any benefit and there has been no
imminent and manifest danger to the property or
SUGGESTED ANSWER
business, the owner is liable as under the first
paragraph of the preceding article, provided:
(1) The officious manager has acted in good (a) The juridical relation is that of the quasi-
faith, and contract of "negotiorum gestio". Y is the
(2) The property or business is intact, ready to
"gestor" or "officious manager" and X is the
be returned to the owner.
"owner" (Art. 2144, Civil Code).
Article 2152. The officious manager is
personally liable for contracts which he has (b) Y must render an account of his
entered into with third persons, even though he operations and deliver to X the price he
acted in the name of the owner, and there shall received for the sale of the harvested fish
be no right of action between the owner and (Art. 2145, Civil Code).
third persons. These provisions shall not apply:
(1) If the owner has expressly or tacitly ratified (c) X must pay the loan obtained by Y from
the management, or W because X must answer for obligations
(2) When the contract refers to things pertaining
contracted with third persons in the interest
to the owner of the business.
of the owner (Art. 2150, Civil Code)
Article 2153. The management is extinguished:
(1) When the owner repudiates it or puts an end (d) Express ratification by X provides the
thereto; effects of an express agency, and X is
(2) When the officious manager withdraws from liable to pay the commissions habitually
the management, subject to the provisions of received by the gestor as manager (Art.
article 2144; 2149, Civil Code)
(3) By the death, civil interdiction, insanity or
insolvency of the owner or the officious
manager
BAR QUESTION BAR QUESTION

While A was abroad, the manager of his factory "C", a Filipino resident of the U.S., sent to his
suddenly died and B and C, A's friends, took father "D' in Manila $500.00 through "X" Bank
over its management, without his knowledge. which had a branch in Manila. Due to mistake
However, since they were businessmen of the employees of the Bank, "D" was paid
themselves, they had to entrust most of their $5,000.00 instead of $500.00. Upon discovery
duties to X and as a result, the factory suffered of the mistake, the Bank demanded from "D"
considerable loss. the return of the $4,500.00. "D" refused and the
Are they liable for said losses? Bank sued him
If they are, why and what is the nature of their Is the Bank entitled to recover from "D"?
liability?
SUGGESTED ANSWER
SUGGESTED ANSWER
Yes, the Bank is entitled to recover the $4,500
Here, B and C are liable for the acts of their from "D". We have in this case an example of a
delegate. Under the law, if the officious quasi-contract of solutio indebiti which arises
manager delegates to another person all or whenever a person unduly delivers a thing
some of his duties, he shall be liable for the through mistake to another who has no right to
acts of the delegate, without prejudice to the demand it (Art 2154, Civil Code). Its requisites
direct obligation of the latter toward the owner are:
of the business. (1) There must be a payment or delivery made
As to the nature of liability, it is only joint by one person to another;
because the management of the business was (2) The person who made the payment or
assumed to avoid an imminent danger. Under delivery was under no obligation to do so;
the law, the responsibility of two or more and
officious managers shall be solidary, unless the (3) The payment or delivery was made by
management was assumed to save the thing or reason of mistake.
business from imminent danger. All of the above requisites are present in the
instant case.
B. SOLUTIO INDEBITI
RIGHT OF PAYER WHEN PAYMENT MADE
BECAUSE OF DOUBT
‘Solutio indebiti’ defined
• Refers to payment by mistake. It is receiving • Payer may recover if he proves that it was not
due. [Article 2156]
payment by mistake that is not due or does
• Solidary Liability of the Payees
not have such right to demand such payment.
It creates an obligation to return such
payment. General Rule: Obligations are joint.
XPN: The responsibility of two or more payees,
• It is the quasi-contract that arises when a
when there has been payment of what is not
person is obliged to return whatever was
due, is solidary. [Article 2157]
received by him through error or mistake or
received by him although there was no right
RULE WHEN PROPERTY BELONGS TO A
to demand it.
• If something is received when there is no right THIRD PERSON
The payee shall comply with the provisions of
to demand it, and it was unduly delivered
Article 1984 [Article 2158]
through mistake, the obligation to return it
arises.
• Mistake in payment (see Arts. 2154 – 2163) Article 1984. The depositary cannot demand
that the depositor prove his ownership of the
• The responsibility of two or more payees,
thing deposited.
when there has been mistake of payment, is
solidary (Art 2157)
Nevertheless, should he discover that the thing
has been stolen and who its true owner is, he
Requisites for Solutio Indebiti
1. Receipt (not mere acknowledgment) of must advise the latter of the deposit.
something. (Art. 2154).
If the owner, in spite of such information, does
2. There was no right to demand it (because
not claim it within the period of one month, the
the giver had no obligation).
depositary shall be relieved of all responsibility
3. The undue delivery was because of
by returning the thing deposited to the depositor.
mistake of fact or law.
If the depositary has reasonable grounds to
Note: When the payment was not by mistake or
believe that the thing has not been lawfully
voluntary, but was made because of the
acquired by the depositor, the former may return
coercive process of the writ of execution, solutio
indebiti does NOT apply. the same.
RULE IF PAYEE IS IN BAD FAITH Funeral Expenses Borne By a Third Person

Whoever in bad faith accepts an undue payment General Rule: When funeral expenses are
shall: borne by a third person, without the knowledge
1. Pay legal interest if a sum of money is of those relatives who were obliged to give
involved, support to the deceased, said relatives shall
2. Be liable for fruits received or which should reimburse the third person, should the latter
have been received if the thing produces claim reimbursement. [Article 2165]
fruits (damages).
3. Be answerable for any loss or impairment of Services Rendered By a Physician or Other
the thing from any cause, and for damages to Persons
the person who delivered the thing, until it is General Rule: The injured person receiving
recovered. [Article 2159] treatment shall be liable to pay for the services
of the physician or other person aiding him.
LIABILITY OF PAYEE IN GOOD FAITH XPN: Unless the service has been rendered out
He who in good faith accepts an undue payment of pure generosity. [Article 2167]
of a thing certain and determinate shall:
1. Be responsible for the impairment or loss of Rule When Property Is Saved During a
the same or its accessories and accessions Calamity
insofar as he has thereby been benefited. • The owner of the property shall be bound to
2. If he has alienated it, she shall return the pay just compensation. [Article 2168]
price or assign the action to collect the sum. • Calamity Includes:
[Article 2160] 1. Fire;
2. Flood;
Reimbursement for Improvement and
3. Storm; etc.
Expenses
As regards the reimbursement for improvements
Rule When Government Undertakes
and expenses incurred by him who unduly
Necessary Work
received the thing, the provisions of Title V of
When the government, upon the failure of any
Book II shall govern. [Article 2161]
person to comply with health or safety
regulations concerning property, undertakes to
RIGHT OF A PAYEE WHO DESTROYS THE
do the necessary work, even over his objection,
EVIDENCES OR PROOFS OF HIS RIGHT
Payee shall be exempt from the obligation to he shall be liable to pay the expenses. [Article
restore who, believing in good faith that the 2169]
payment was being made of a legitimate and
subsisting claim, destroyed the document, or Payment Made By a Third Person
allowed the action to prescribe, or gave up the When a third person, without the knowledge of
pledges, or cancelled the guaranties for his right. the debtor, pays the debt, he shall have a right
[Article 2162] to be reimbursed to the extent payment had
benefited the debtor.
Action of Person Who Paid Unduly
He who paid unduly may proceed only against Measure for Protection Decided Upon By a
the true debtor or the guarantors with regard to Community
whom the action is still effective. Any one who objects to the plan and refuses to
contribute to the expenses but is benefited by
WHEN MISTAKE IS PRESUMED the project as executed against lawlessness,
General Rule: It is presumed that there was a fire, flood, storm or other calamity shall be liable
mistake in the payment if something which had to pay his share of said expenses. [Article 2174]
never been due or had already been paid was
delivered. [Article 2163] When Someone is Constrained to Pay
Another’s Taxes
Burden Of Proof The person constrained to pay the taxes of
He from whom the return is claimed may prove another shall be entitled to reimbursement from
that the delivery was made out of liberality or for the latter. [Article 2175]
any other just cause.
OTHER QUASI-CONTRACTS
Support Given by a Stranger
General Rule: 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.
XPN: Unless it appears that he gave it out of
piety and without intention of being repaid.
[Article 2164]
VII. TORTS AND DAMAGES

A. Principles G. Res ipsa Loquitur
B. Classification of Torts H. Damnum Absque Injuria
C. The Torfeasor I. Defenses
D. Quasi-Delict vs. Culpa Contractual vs. J. Negligence
Culpa Criminal K. Damages
E. Proximate Cause L. Damages in Case of Death
F. Vicarious Liability M. Duty of injured Party
TORT LOMARDA v. Fudalan

‘Tort’ defined G.R. No. 246012, June 17, 2020
• A tort is an act or omission that gives rise "Article 19, known to contain what is commonly
to injury or harm to another and amounts referred to as the principle of abuse of rights,
sets certain standards which may be observed
to a civil wrong for which courts impose
not only in the exercise of one's rights but also in
liability.
the performance of one's duties." In this regard,
• In the context of torts, "injury" is the case law states that "[a] right, though by itself
invasion of any legal right, whereas legal because [it is] recognized or granted by
"harm" is a loss or detriment in fact that law as such, may nevertheless become the
an individual suffers source of some illegality. When a right is
• In common law, tort is an unlawful exercised in a manner which does not conform
violation of private right, not created by with the norms enshrined in Article 19 and
contract, and which gives rise to an action results in damage to another, a legal wrong is
for damages. thereby committed for which the wrongdoer must
• It is a violation of a duty imposed by be held responsible."
• Article 19 is the general rule which governs
general law or otherwise upon all persons
the conduct of human relations. By itself, it is
occupying the relation to each other that
not the basis of an actionable tort. Article 19
is involved in a given transaction. describes the degree of care required so that
an actionable tort may arise when it is alleged
A. PRINCIPLES together with Article 20 or Article 21."
• Art. 20. Every person who, contrary to law,
wilfully or negligently causes damage to
1. ABUSE OF RIGHTS another, shall indemnify the latter for the
Article. 19. Every person must, in the exercise same.
of his rights and in the performance of his duties, • Art. 21. Any person who wilfully causes loss
act with justice, give everyone his due, and or injury to another in a manner that is
observe honesty and good faith. contrary to morals, good customs or public
policy shall compensate the latter for the
ARDIENTE v. SPS. PASTORFIDE damage.
G.R. No. 161921, July 17, 2013
• This article sets certain standards which must Thus, in Philippine National Bank vs. CA, this
be observed not only in the exercise of one's Court held that:
rights, but also in the performance of one's The aforecited provisions on human relations
duties. The law recognizes a primordial were intended to expand the concept of torts in
limitation on all rights; that in their exercise, this jurisdiction by granting adequate legal
the norms of human conduct set forth in remedy for the untold number of moral wrongs
Article 19 must be observed. which is impossible for human foresight to
• A right, though by itself legal because specifically provide in the statutes. Although
recognized or granted by law as such, may Article 19 merely declares a principle of law,
nevertheless become the source of some Article 21 gives flesh to its provisions. Thus, we
illegality. When a right is exercised in a agree with private respondent's assertion that
manner which does not conform with the violations of Articles 19 and 21 are actionable,
norms enshrined in Article 19 and results in with judicially enforceable remedies in the
damage to another, a legal wrong is thereby municipal forum.
committed for which the wrongdoer must be
held responsible.
2. UNJUST ENRICHMENT
Article 22. Every person who through an act of
STANDARDS TO FOLLOW:
performance by another, or any other means,
1. to act with justice;
acquires or comes into possession of something
2. to give everyone his due; and
at the expense of the latter without just or legal
3. to observe honesty and good faith.
ground, shall return the same to him.
FILINVEST LAND, INC. v. BACKY • In cases under Article 21, the legal issues
G.R. No. 174715, October 11, 2012 revolve around whether such outcome should
Unjust enrichment exists "when a person be considered a legal injury on the part of the
unjustly retains a benefit to the loss of another, plaintiff or whether the commission of the act
or when a person retains money or property of was done in violation of the standards of care
another against the fundamental principles of required in Article
justice, equity and good conscience." The
principle of unjust enrichment essentially Requirements for Acts Contrary to Morals To
contemplates payment when there is no duty to Be Actionable
pay, and the person who receives the payment • The act is contrary to morals, good customs
has no right to receive it. or public policy;
• Act was performed with an intent to prejudice
REQUISITES OF UNJUST ENRICHMENT another person;
a. A person is unjustly benefited • Injury sustained by the plaintiff as a result of
b. Such benefit is derived at the expense of the act.
or with damages to another
B. CLASSIFICATION OF TORTS
Note: The claimant must unequivocally prove
that another party knowingly received something 1. INTENTIONAL
• Include conduct where the actor desires to
of value to which he was not entitled and that the
cause the consequences of his act or believe
state of affairs are such that it would be unjust
for the person to keep the benefit. the consequences are substantially certain to
result from it.
• They are found in Chapter 2 of the
3. LIABILITY WITHOUT FAULT
Preliminary Title of the NCC entitled “Human
General Rule: liability requires fault or
Relations”, i.e. Arts. 19, 20, 21, 26.
negligence which caused injury
• Distinguished from negligent tort – negligence
XPN: Strict Liability Tort
involves foreseeability of the risk NOT
certainty of the harm.
‘Strict Liability Tort’ defined
• It is where a person is made liable
2. NEGLIGENT
• Involves voluntary acts or omissions which
independent of fault or negligence upon
submission of proof of certain facts as result in injury to others, without intending to
required by law. cause the same.
• The actor fails to exercise due care in
• A person is liable for damages regardless of
fault or negligence and regardless of performing such acts or omissions.
intention.
3. STRICT LIABILITY
4. ACTS CONTRARY TO LAW • Where a person is made liable independent
Article 20. Every person who, contrary to law, of fault or negligence upon submission of
proof of certain facts.
wilfully or negligently causes damage to another,
shall indemnify the latter for the same. • When strict liability is imposed, conduct is
• Concerns violations of existing law as basis generally not wrongful in itself, but the law
for an injury imposes liability to compensate for damages
suffered by another.
Concept of Acts Contrary to Law • Doctrine that holds a person liable for any
• It allows recovery should the act have been injuries or damages caused by their products,
willful or negligent. actions, or animals, even if they had no intent
to harm and were not at fault.
Requirements for Acts Contrary to Law to be
Purpose of Strict Liability
Actionable
• To protect the public and consumers from
• An act violative a law, whether willful or
injury caused by those products, actions, or
negligent;
animals, and to remove the burden of proof
• Injury suffered by another as a result of the
from an injured party.
unlawful act.
• Neither negligence nor strict liability torts
require intent, but in a negligence case there is
5. ACTS CONTRARY TO MORALS a reasonable duty of care owed to a person.
Article 21. Any person who wilfully causes loss • In strict liability, there is a duty to everyone
or injury to another in a manner that is contrary because of the nature of the activity.
to morals, good customs or public policy shall • These absolute duties are required so that
compensate the latter for the damage. persons are safe from extremely hazardous
• Concerns injuries that may be caused by acts circumstances because of certain
which are not necessarily proscribed by law. presumptions that people hold every day.
STRICT TORT AGAINST MANUFACTURERS STRICT TORT AGAINST EMPLOYERS

AND PROCESSORS d. Article 1711 Civil Code
a. Article 2187 Civil Code Owners of enterprises and other
Manufacturers and processors of employers are obliged to pay
foodstuffs, drinks, toilet articles and compensation for the death of or injuries
similar goods shall be liable for death or to their laborers, workmen, mechanics or
injuries caused by any noxious or other employees, even though the event
harmful substances used, although no may have been purely accidental or
contractual relation exists between them entirely due to a fortuitous cause, if the
and the consumers. death or personal injury arose out of and
in the course of the employment. Xxx
STRICT TORT AGAINST ANIMAL
POSSESSORS C. THE TORTFEASORS
b. Article 2183 Civil Code
The possessor of an animal or whoever
1. JOINT
may make use of the same is
Art. 2194. The responsibility of two or more
responsible for the damage which it may
persons who are liable for quasi-delict is
cause, although it may escape or be lost.
solidary.
This responsibility shall cease only in
case the damage should come from
LIABILITY OF JOINT TORTFEASORS
force majeure or from the fault of the
• Under Article 2194 of the Civil Code, joint
person who has suffered damage.
tortfeasors are solidarily liable for the
BAR QUESTION (2010) resulting damage.
• In other words, joint tortfeasors are each
Primo owns a pet iguana which he keeps in liable as principals, to the same extent and in
a man-made pond enclosed by a fence the same manner as if they had performed
situated in his residential lot. A typhoon the wrongful act themselves.
knocked down the fence of the pond and
the iguana crawled out of the gate of PHILIPPINE NATIONAL CONSTRUCTION
Primo’s residence. CORPORATION VS. CA
G.R. No. 159270, August 22, 2005
N, a neighbor who was passing by, started
Where their concurring negligence resulted in
throwing stones at the iguana, drawing the injury or damage to a third party, they become
iguana to move toward him. N panicked joint tortfeasors and are solidarily liable for the
and ran but tripped on something and resulting damage under Article 2194 of the Civil
suffered a broken leg. Code.
Is anyone liable for N’s injuries? Explain.
2. DIRECT
SUGGESTED ANSWER
No one is liable. Natural Person
The possessor of an animal or whoever A natural person or human being has physical
may make use of the same is responsible existence.
for the damage which it may cause,
Liability of Natural Persons
although it may escape or be lost. This
responsibility shall cease only in case the A. Personal Liability
damage should come from force majeure General Rule: One is only responsible for his
or from the fault of the person who has own act or omission. Thus, a person will
suffered damage (Art. 2183, NCC). generally be held liable ONLY for the torts
N’s injury clearly resulted from his own act committed by himself and NOT by another.
of throwing stones at the iguana and his
subsequent accidental tripping into B. Vicarious Liability
something as he ran away from the iguana A person is not only liable for torts committed by
out of fear. himself, but also for torts committed by others
with whom he has a certain relation or for whom
STRICT TORT AGAINST FAMILY HEADS he is responsible. (Article 2180 Civil Code)
c. Article 2193 Civil Code
Rationale: Persons become liable for their own
The head of a family that lives in a
omission to comply with their duty to exercise
building or a part thereof, is responsible diligence in supervision/care over the persons
for damages caused by things thrown or for whom they are responsible
falling from the same.
Juridical Person D. QUASI-DELICT VS.

• Juridical person exists only in
CULPA CONTRACTUAL VS.
contemplation of law.
• Juridical persons are also directly liable CULPA CRIMINAL
just like natural persons whenever a
Kinds of Actionable Negligence
tortuous act is committed by an officer a. Culpa Contractual (contractual
or agent under the express direction or negligence)Governed by Civil Code
authority of the stockholders or provisions on Obligations and Contracts,
members acting as a body, or, particularly Arts. 1170 to 1174 of the Civil
generally, from the directors as the Code.
governing body. b. Culpa Aquiliana (quasi-delict)
• A corporation is civilly liable in the Governed mainly by Art. 2176 of the Civil
same manner as natural persons for Code
torts, because "generally speaking, the c. Culpa Criminal (criminal negligence)
rules governing the liability of a Governed by Art. 365 of the Revised
principal or master for a tort committed Penal Code.
by an agent or servant are the same
whether the principal or master be a Quasi-Delict’ or CULPA AQUILIANA
natural person or a corporation, and • It is extra-contractual obligations which
whether the servant or agent be a arise only between parties not otherwise
natural or artificial person. All of the bound by contract, whether express or
authorities agree that a principal or implied.
• The wrongful or negligent act or omission
master is liable for every tort which he
which creates a vinculum juris and gives
expressly directs or authorizes, and this
rise to an obligation between two persons
is just as true of a corporation as of a not formally bound by any other obligation.
natural person. A corporation is liable, • Governed by Article 2176 of the Civil
therefore, whenever a tortious act is Code
committed by an officer or agent under
express direction or authority from the Art. 2176. Whoever by act or omission causes
stockholders or members acting as a damage to another, there being fault or
body, or, generally, from the directors negligence, is obliged to pay for the damage
as the governing body.” (PNB v. CA, done. Such fault or negligence, if there is no
G.R. No. L-27155, May 18, 1978) pre-existing contractual relation between the
parties, is called quasi-delict.
Partnership Tort General Rule: Any act or omission coming

There is partnership tort where: under the purview of Article 2176 gives rise to
1. By any wrongful act or omission of a cause of action under quasi-delict
any partner, acting in the ordinary [Concurring Opinion, Alano v Magud-Logmao,
course of business of the partnership G.R. No. 175540, April 7, 2014].
or with authority of his co-partners,
ELEMENTS OF A QUASI-DELICT
loss or injury is caused to any person,
1. An act or omission
not being a partner in the partnership;
2. The presence of fault or negligence in the
2. One partner, acting within the scope
performance or non-performance of the
of his apparent authority, receives act
money or property from a third 3. Injury - The illegal invasion of a legal right
person, and misapplies it; or 4. A causal connection between the
3. The partnership, in the course of its negligent act and the injury; - The nexus
business, receives money or or connection of the cause and effect,
property, and it is misapplied by any between a negligent act and the damage
partner while it is in the custody of the done, must be established by competent
partnership. evidence.
5. No pre-existing contractual relation
General Rule: There should be no pre-
Note: Partners are SOLIDARILY LIABLE existing contractual relations between the
with the partnership for any penalty or persons involved
damage arising from a partnership tort. Exception: The act or omission is a tort
(Articles 1822 and 1823 NCC) independent of the contract
BAR QUESTION(2019) Art. 1174. Except in cases expressly specified

by the law, or when it is otherwise declared by
In January 2018, Mrs. A, a married woman on her
stipulation, or when the nature of the obligation
sixth (6th) month of pregnancy, was crossing a
street when she was suddenly hit by a car being requires the assumption of risk, no person shall
recklessly driven by Mr. X. As a result, Mrs. A be responsible for those events which could not
sustained serious injuries and further, suffered an be foreseen, or which, though foreseen, were
unintentional abortion. Mrs. A was hospitalized inevitable.
for two (2) months, during which she incurred
₱400,000.00 in medical fees. Her expenses were SPS. BATAL v. SPS. TOMINAGA
all duly substantiated by official receipts. During G.R. No. 164601, Sept. 27, 2006
the two (2)-month period of her confinement, she Facts:
was unable to report for work and earn any • Sps. Tominaga contracted the services of
salary, which was established at the rate of Frank Batal, who represented himself as a
₱50,000.00 per month. Mrs. A then filed a civil surveyor, to conduct a survey of their lot and
case for damages against Mr. X. Based on the to determine its exact boundaries for the
case filed by Mrs. A, what is the source of Mr. X's construction of their perimeter fence.
obligation to her as a result of his acts? Explain. • Consequently, Frank placed concrete
monuments marked P.S. on all corners of the
SUGGESTED ANSWER
lot which were used as guides by Sps.
The source of Mr. X’s liability is quasi-delict Tominaga in erecting a concrete fence
Under the Civil Code, whoever by act or omission measuring about eight (8) feet in height.
causes damage to another, there being fault or Sometime in 1996, a complaint was lodged
negligence, is obliged to pay for the damages. against them for encroaching upon a
Such fault or negligence, if there is no pre- designated right-of-way known as Lot 1509-
existing contractual relations between the parties D. Upon verification with another surveyor,
is called a quasi-delict. Here, there is no pre- they found that their wall indeed overlapped
existing contractual relations between Mr. A and the adjoining lot. They also discovered that it
Mr. X who are strangers, and the damage was was not Frank but his wife Erlinda Batal, who
caused by Mr. X’s negligence.
is a licensed geodetic engineer.
Issue:
CULPA CONTRACTUAL WoN petitioners are liable for damages.
• The foundation of the liability of the defendant Ruling:
is the contract • Culpa, or negligence, may be understood in
• The fault or negligence incident in the two different senses: either as culpa
performance of an obligation which already aquiliana, which is the wrongful or negligent
existed, and which increases the liability from act or omission which creates a vinculum juris
such already existing obligation. and gives rise to an obligation between two
persons not formally bound by any other
Governed by Art. 1170 -1174 of the Civil Code.
obligation, or as culpa contractual, which is
Art. 1170. Those who in the performance of their
the fault or negligence incident in the
obligations are guilty of fraud, negligence, or
performance of an obligation which already
delay, and those who in any manner contravene
existed, and which increases the liability from
the tenor thereof, are liable for damages.
such already existing obligation. Culpa
Art. 1171. Responsibility arising from fraud is aquiliana is governed by Article 2176 of the
demandable in all obligations. Any waiver of an Civil Code and the immediately following
action for future fraud is void. Articles; while culpa contractual is governed
by Articles 1170 to 1174 of the same Code.
Art. 1172. Responsibility arising from negligence • In the present case, it is clear that the
in the performance of every kind of obligation is petitioners, in carrying out their contractual
also demandable, but such liability may be obligations, failed to exercise the requisite
regulated by the courts, according to the diligence in the placement of the markings for
circumstances. the concrete perimeter fence that was later
constructed. xxx Being guilty of a breach of
Art. 1173. The fault or negligence of the obligor their contract, petitioners are liable for
consists in the omission of that diligence which is damages suffered by the respondents
required by the nature of the obligation and
corresponds with the circumstances of the CULPA CRIMINAL
persons, of the time and of the place. When • This results in the commission of a crime.
negligence shows bad faith, the provisions of • Criminal negligence governed by Art. 365 of
articles 1171 and 2201, paragraph 2, shall apply. the Revised Penal Code.
If the law or contract does not state the diligence • General Rule: Accused is presumed
which is to be observed in the performance, that innocent until the contrary is proven.
which is expected of a good father of a family • Note: The prosecution has the burden of
shall be required. proving the negligence
CULPA CONTACTUAL V. CULPA BAR QUESTION (2003)

AQUILANA As a result of a collision between the taxicab
owned by A and another taxicab owned by B,
CULPA CULPA
X, a passenger of the first taxicab, was
CONTRACTUAL AQUILANA seriously injured. X later filed a criminal action
against both drivers. May both taxicab owners
The foundation of the It is a separate
raise the defense of due diligence in the
liability of the source of obligation selection and supervision of their drivers to be
defendant is the independent of absolved from liability for damages to X?
contract contract Reason. 5%
In breach of contract In quasi-delict the SUGGESTED ANSWER
committed through presumptive They cannot raise the defense in civil liability
the negligence of responsibility for arising from crimes. The employers are
employee, the the negligence of subsidiarily liable for the civil liability of their
employer cannot his servants can be employees in culpa criminal, based on the
erase his primary and rebutted by proof of doctrine of respondeat superior.
direct liability by the exercise of due If the civil action is based on a quasi-delict the
invoking exercise of care in their taxicab owners may raise the defense of
diligence of a good selection and diligence of a good father of a family in the
father of a family in supervision. selection and supervision of the driver; if the
action against them is based on culpa
the selection and
contractual or civil liability arising from a crime,
supervision of the
they cannot raise the defense
employee.
E. PROXIMATE CAUSE
CULPA AQUILANA V. CRIME
1. CONCEPT
CULPA AQUILANA CRIME ‘Proximate Cause’ defined
• That cause, which, in natural and continuous
Only involves private Affect the public
sequence, unbroken by any efficient
concern. interest
intervening cause, produces the injury, and
The Civil Code by The Revised Penal without which the result would not have
means of Code punishes or occurred.
• That cause acting first and producing the
indemnification corrects criminal act.
injury, either immediately or by setting other
merely repairs the
events in motion, all constituting a natural
damage. and continuous chain of events, each having
a close causal connection with its immediate
Includes all acts in Punished only if
predecessor, the final event in the chain
which any kind of there is a penal law
immediately effecting the injury as natural
fault or negligence clearly covering and probable result of the cause which first
intervenes. them. acted, under such circumstances that the
person responsible for the first event should,
Liability is direct and Liability of the
as an ordinarily prudent and intelligent
primary in quasi- employer of the
person, have reasonable ground to expect at
delict. actor-employee is the moment of his act or default that an
subsidiary in crimes. injury to some person might probably result
therefrom.
1. NATURE OF LIABILITY
• There may be concurrence of causes of Determining Proximate Cause
action (Ex: Common Carriers liability may • There is no exact mathematical formula to
arise ex contractu, quasi ex-delicto and ex determine proximate cause. It is based upon
mixed considerations of logic, common
delicto even if there is only a single act or
sense, policy and precedent.
omission.) • Plaintiff must establish a sufficient link
• Either of these liabilities may be enforced between the act or omission and the
against the offender subject to Article 2177 – damage or injury.
plaintiff cannot recover damages twice for the • The link must not be remote or far-fetched.
same act or omission (proscription against • The damage or injury must be a natural and
double recovery) probable result of the act or omission.
2. DOCTRINE OF LAST CLEAR SUGGESTED ANSWER

CHANCE
I would decide in favor of Mr. & Mrs. S. The
• Where both parties are negligent but proprietor of a building or structure is
the negligent act of one is appreciably responsible for the damages resulting from
later than that of the other, the one who its total or partial collapse, if it should be due to
has the last reasonable opportunity to the lack of necessary repairs (Art 2190 Civil
avoid the impending harm and fails to Code). As regards the defense of “last clear
do so, is chargeable with the chance,” the same is not tenable because
consequences of the loss without according to the Supreme Court in one case
(De Roy v. CA, GR L-80718, Jan. 29, 1988,
reference to the prior negligence of the
157 SCRA 757) the doctrine of last clear
other party (Applicable Case: Picart v. chance is not applicable to instances covered
Smith) by Art 2190 of the Civil Code. Further, in
• No recovery can be made if plaintiff is Phoenix Construction, Inc. v.s IAC (G.R. No. L-
the proximate case. 65295, March 10, 1987, 148 SCRA 353), the
• Recovery can be made but such will be Supreme Court held that the role of the
mitigated if plaintiff is not the proximate common law “last clear chance” doctrine in
relation to Article 2179 of the Civil Code is
cause.
merely to mitigate damages within the context
• Each bears his own loss if negligence of of contributory negligence.
parties is equal in degree.
F. VICARIOUS LIABILITY
Instances when the doctrine is not
applicable: Vicarious liability’ defined
i. In case of culpa contractual, where • Also known as imputed liability
neither the contributory negligence of • A person is not only liable for torts committed
the plaintiff nor his last clear chance by himself, but also for torts committed by
others with whom he has a certain relation or
to avoid the loss would exonerate the
for whom he is responsible. (Article 2180 Civil
defendant from liability. Code)
ii. The party charged is required to act
instantaneously. Rationale: Persons become liable for their own
iii. It does not arise where a passenger omission to comply with their duty to diligently
demands responsibility from the exercise care, control and supervision over the
carrier to enforce its contractual persons for whom they are responsible.
obligations.
Concept of Vicarious Liability
iv. If the plaintiff was not negligent. • Art. 2180. The obligation imposed by article
2176 is demandable not only for one’s own
BAR QUESTION (1990) acts or omissions, but also for those of
Mr. and Mrs. R own a burned-out building, persons for whom one is responsible.
the firewall of which collapsed and • The father and, in case of his death or
destroyed the shop occupied by the family incapacity, the mother, are responsible for the
damages caused by the minor children who
of Mr. and Mrs. S, which resulted in injuries
live in their company.
to said couple and the death of their • Guardians are liable for damages caused by
daughter. Mr. and Mrs. S had been warned the minors or incapacitated persons who are
by Mr. & Mrs. R to vacate the shop in view under their authority and live in their
of its proximity to the weakened wall but company.
the former failed to do so. • The owners and managers of an
Mr. & Mrs. S filed against Mr. and Mrs. R establishment or enterprise are likewise
an action for recovery of damages the responsible for damages caused by their
former suffered as a result of the collapse employees in the service of the branches in
of the firewall. In defense, Mr. and Mrs. R which the latter are employed or on the
rely on the doctrine of last clear chance occasion of their functions.
• Employers shall be liable for the damages
alleging that Mr. and Mrs. S had the last
caused by their employees and household
clear chance to avoid the accident if only helpers acting within the scope of their
they heeded the former’s warning to vacate assigned tasks, even though the former are
the shop, and therefore Mr. and Mrs. R’s not engaged in any business or industry.
prior negligence should be disregarded.
If you were the judge, how would you
decide the case? State your reasons.
• The State is responsible in like manner when Defense against vicarious liability
it acts through a special agent; but not when Employers must submit concrete proof,
the damage has been caused by the official to including documentary evidence, that they
whom the task done properly pertains, in complied with everything that was incumbent
which case what is provided in article 2176
on them.
shall be applicable.
• Lastly, teachers or heads of establishments of
arts and trades shall be liable for damages Note: Employers carry the burden of proof
caused by their pupils and students or that there was no negligence on their part.
apprentices, so long as they remain in their
BAR QUESTION (2001)
custody.
• The responsibility treated of in this article After working overtime up to midnight,
shall cease when the persons herein Alberto, an executive of an insurance
mentioned prove that they observed all the company drove a company vehicle to a favorite
diligence of a good father of a family to Videoke bar where he had some drinks and sang
prevent damage. some songs with friends to “unwind”. At 2:00
a.m., he drove home, but in doing so, he bumped
Between Parents and Their Minor Children a tricycle, resulting in the death of its driver. May
Principle of Parental Liability the insurance company be held liable for the
• Parental liability is made a natural or logical negligent act of Alberto? Why?
consequence of the duties and SUGGESTED ANSWER
responsibilities of parents — their parental
authority — which includes the instructing, The insurance company is not liable because
controlling and disciplining of the child. when the accident occurred, Alberto was not
acting within the assigned tasks of his
Note: The responsibility of the parent ceases employment. It is true that under Art. 2180 (par.
when he proves that he observed the diligence 5), employers are liable for damages caused by
their employees who were acting within the
of a good father of a family to prevent damage.
scope of their assigned tasks. However, the
BAR QUESTION (2005) mere fact that Alberto was using a service
vehicle of the employer at the time of the
Under the law on quasi-delict, aside from the injurious accident does not necessarily mean that
persons who caused injury to persons, who is he was operating the vehicle within the
liable under this circumstance: scope of his employment.
When a 7-year old boy injures his playmate Notwithstanding the fact that Alberto did some
while playing with his father’s rifle. Explain. overtime work for the company, he was,
nevertheless, engaged in his own affairs or
SUGGESTED ANSWER carrying out a personal purpose at the time of the
The parents of the 7-year old boy who caused accident. (Castilex Industrial Corp. v. Vasquez Jr.
injury to his playmate are liable under Article (321 SCRA 393[1999]).
219 of the Family Code since they exercise
parental authority over the person of the boy. BAR QUESTION (2009)
(Tamargo v. Court of Appeals, G.R. No. 85044,
Rommel’s private car, while being driven by the
June 3,1992; Elcano v. Hill, G.R. No. L-24803,
regular family driver, Amado, hits a pedestrian
May 26, 1977).
causing the latter’s death. Rommel is not in the
car when the incident happened.
Between Employers and Employees Is Rommel liable for damages to the heirs of the
Liability of the Employers deceased? Explain.
The liability of the employer under Article
SUGGESTED ANSWER
2180 is direct and immediate; it is not
conditioned upon prior recourse against the Yes, Rommel may be held liable for damages if
negligent employee and a prior showing of he fails to prove that he exercised the diligence
the insolvency of such employee. of a good father of a family (Art. 2180, par. 5,
NCC) in selecting and supervising his family
driver. The owner is presumed liable unless he
General Rule: When an injury is caused by proves the defense of diligence. If the driver was
the negligence of the employee, there performing his assigned task when the incident
instantly arises a presumption of law that happened, Rommel shall be solidarily liable with
there was negligence on the part of the the driver.
master or employer either in the selection of In case the driver is convicted of reckless
the servant or employee, or in supervision imprudence and cannot pay the civil liability,
Rommel is subsidiarily liable for the damages
over him after selection or both.
awarded against the driver and the defense of
diligence is not available
REYES v. DOCTOLERO
Employers shall be liable for the damages
G.R. No. 185597, August 2, 2017
caused by their employees and household
• Although the employer is not the actual
helpers acting within the scope of their assigned
tortfeasor, the law makes him vicariously
tasks, even though the former are not engaged
liable on the basis of the civil law principle of
in any business or industry. The State is
paterfamilias for failure to exercise due care
responsible in like manner when it acts through
and vigilance over the acts of one's
a special agent; but not when the damage has
subordinates to prevent damage to another.
been caused by the official to whom the task
• However, the above rule is applicable only if
done properly pertains, in which case what is
there is an employer-employee relationship.
provided in Article 2176 shall be applicable.
This employer-employee relationship cannot
be presumed but must be sufficiently proven
The responsibility treated of in this article shall
by the plaintiff. The plaintiff must also show
cease when the persons herein mentioned
that the employee was acting within the
prove that they observed all the diligence of a
scope of his assigned task when the tort
good father of a family to prevent damage.
complained of was committed. It is only then
that the defendant, as employer, may find it CBP's establishment of clearing house facilities
necessary to interpose the defense of due for its member banks to which Valentino and
diligence in the selection and supervision of Estacio were assigned as Bookkeeper and
Janitor-Messenger, respectively, is a
employees.
governmental function.
BPI v. CBP and Citibank
As such, the State or CBP in this case, is liable
G.R. No. 197593, October 12, 2020
only for the torts committed by its employee
J. Hernando
when the latter acts as a special agent but not
Facts:
when the said employee or official performs his
• On January 28, 1982, BPI Laoag City Branch
or her functions that naturally pertain to his or
(BPI Laoag) discovered P9 million
her office. A special agent is defined as one
outstanding discrepancies in its inter-bank
who receives a definite and fixed order or
reconciliation statements in CBP. Hence, BPI
commission, foreign to the exercise of the duties
filed a letter-complaint on the matter and
of his office.
requested for an investigation and was
referred to the NBI to conduct a separate
Evidently, both Valentino and Estacio are not
investigation.
considered as special agents of CBP during
• The NBI Investigation Report showed that an
their commission of the fraudulent acts against
organized criminal syndicate using a scheme
petitioner BPI as they were regular employees
known as "pilferage scheme" committed the
performing tasks pertaining to their offices,
bank fraud in the following manner: (a) the
namely, bookkeeping and janitorial-messenger.
infiltration of the Clearing Division of the CBP
Thus, CBP cannot be held liable for any
with the connivance of some personnel of the
damage caused to petitioner BPI by reason of
CBP Clearing House; (b) the pilferage of
Valentino and Estacio's unlawful acts.
"out-of-town" checks; (c) the tampering of
vital banking documents, such as clearing
Even on the assumption that CBP is performing
manifests and clearing statements; (d) the
proprietary functions, still, it cannot be held
opening of Current Accounts by members of
liable because Valentino and Estacio acted
the syndicate with the BPI Laoag City Branch
beyond the scope of their duties. Even
and Citibank, Greenhills Branch in
assuming that CBP is an ordinary employer, it
Mandaluyong City; and (e) the withdrawal of
still cannot be held liable.
funds through checks deposited with Citibank
and drawn against BPI.
Article 2180 of the Civil Code provides that an
Issue:
employer shall be liable for the damages caused
WoN Central Bank of the Philippines is liable
by their employees acting within the scope of
for the bank fraud committed by its two
their assigned tasks. An act is deemed an
employees
assigned task if it is "done by an employee, in
Ruling:
furtherance of the interests of the employer or
The test of liability depends on whether or not
for the account of the employer at the time of
the employees, acting in behalf of CBP, were
the infliction of the injury or damage."
performing governmental or proprietary
Obviously, Valentino and Estacio's fraudulent
functions. The State in the performance of its
acts of tampering with and pilfering of
governmental functions is liable only for the
documents are not in furtherance of CBP's
tortuous acts of its special agents. On the other
interests nor done for its account as the said
hand, the State becomes liable as an ordinary
acts were unauthorized and unlawful.
employer when performing its proprietary
functions.
MAITIM v. AGUILA G. RES IPSA LOQUITUR

G.R. No. 218344, March 21, 2022
J. Hernando ‘Res Ipsa Loquitur’ Defined
Facts: • It is a Latin phrase that literally means "the
Maitim was on board her vehicle, a Ford W- thing or the transaction speaks for itself."
150 Chateau Wagon registered under her • It is a maxim for the rule that the fact of the
name, which was being driven by Restituto occurrence of an injury, taken with the
Santos, her driver for 12 years. While they surrounding circumstances, may permit an
were driving along the common driveway, inference or raise a presumption of
Angela Aserehet P. Aguila (Angela), the six- negligence, or make out a plaintiff's prima
year old daughter of Aguila, was sideswiped facie case, and present a question of fact for
by Maitim's vehicle. Angela was dragged for the defendant to meet with an explanation.
about three meters resulting to her right leg • This rule is grounded on the superior logic of
being fractured. Maitim and Santos did not ordinary human experience, and it is on the
immediately take Angela to the hospital after basis of such experience or common
knowledge that negligence may be deduced
the incident; she was only brought to St.
from the mere occurrence of the accident
Luke's Medical Center after the insistence of
itself. Hence, the rule is applied in conjunction
Angela's grandmother, Lirio Aguila. Angela
with the doctrine of common knowledge.
was diagnosed to have suffered swelling,
hematoma, multiple abrasions, and displaced, LAYUGAN v. IAC
complete fracture on the right leg. Thus, she G.R. No. 73998, November 14, 1988
underwent operation at Asian Hospital and “Where the thing which causes injury is shown
was in a wheelchair from April 25, 2006 to July to be under the management of the defendant,
18, 2006. and the accident is such as in the ordinary
Issue: course of things does not happen if those who
WoN Maitim is solidarily liable under the have the management used proper care, it
doctrine of vicarious liability affords reasonable evidence, in the absence of
Ruling: an explanation by the defendant, that the
Jurisprudence has established that under accident arose from want of care.”
Article 2180, "when an injury is caused by the
negligence of the employee, there instantly Concept of Res Ipsa Loquitur
arises a presumption of law that there was • Utilizing res ipsa loquitur is a matter of
negligence on the part of the master or evidence, a mode of proof, or a mere
employer either in the selection of the servant procedural convenience, since it furnishes a
or employee, or in supervision over him after substitute for, and relieves a plaintiff of the
selection or both." "The liability of the burden of producing a specific proof of
negligence.
employer under Article 2180 is direct and
• It is peculiar to the law of negligence which
immediate; it is not conditioned upon prior
recognizes that prima facie negligence may
recourse against the negligent employee and
be established without direct proof and
a prior showing of the insolvency of such
furnishes a substitute for specific proof of
employee.“ negligence.
• It is based in part upon the theory that the
Applying these concepts to the present case, defendant in charge of the instrumentality
the finding of negligence against Santos gave which causes the injury either knows the
rise to the presumption of negligence on the cause of the accident or has the best
part of Maitim in the latter's selection and/or opportunity of ascertaining it and that the
supervision of the former. Therefore, it is plaintiff has no such knowledge, and
incumbent upon Maitim to prove that she therefore is compelled to allege negligence in
exercised the diligence of a good father of a general terms and to rely upon the proof of
family in the selection and supervision of her the happening of the accident in order to
employee, Santos. establish negligence.
Given the above, Maitim's attempt to deflect Elements for the Application of the Doctrine
liability clearly falls short as she was not able 1. The accident was of such character as to
to present concrete proof that she exercised warrant an inference that it would not have
the care and diligence of a good father of a happened except for the defendant’s
family in the selection and supervision of her negligence
employee, Santos. Therefore, the presumption 2. The accident must have been caused by an
of negligence against her stands, and she agency or instrumentality within the exclusive
management or control of the person charged
must be held solidarily liable with Santos
with the negligence complained of
3. The accident must not have been due to any • There is a material distinction between
voluntary action or contribution on the part of damages and injury. Injury is the illegal
the person injured. invasion of a legal right; damage is the loss,
hurt, or harm which results from the injury;
RAMOS v. CA and damages are the recompense or
G.R. No. 124354, December 29, 1999 compensation awarded for the damage
Control of Instrumentality which caused the suffered. Thus, there can be damage
damage is the fundamental element. Such without injury in those instances in which
element of control must be shown to be within the loss or harm was not the result of a
the dominion of the defendant. In order to have
violation of a legal duty. These situations
benefit of the rule, a plaintiff, in addition to
are often called damnum absque injuria.
proving injury or damage, must show a situation
• Amonoy v Gutierrez - the legitimate
where it is applicable, and must establish that
the essential elements of the doctrine were exercise of a person's rights, even if it
present in a particular incident. causes loss to another, does not
automatically result in an actionable injury.
AFRICA VS. CALTEX (PHIL.) INC. The law does not prescribe a remedy for
Mar 31, 1966 the loss. This principle does not, however,
In this case, defendant Caltex was liable for apply when there is an abuse of a person's
damage done to the property of its neighbors right, or when the exercise of this right is
when fire broke out in a Caltex service station. suspended
The gasoline station, with all its appliances,
equipment and employees, was under the General Rule: There is no cause of action for
control of the defendant. The persons who knew acts done by one person upon his own
how the fire started were the defendant and its property in a lawful and proper manner,
employees, but they gave no explanation although such acts incidentally cause damage
whatsoever. or an unavoidable loss to another, as such
damage or loss is damnum absque injuria
H. DAMNUM ABSQUE INJURIA
Awarding of Damages in a damnum
‘Damnum Absque Injuria’ defined absque injuria
• Also known as damage without injury. • There is no basis for an award of damages.
• This arises only when the loss or harm was • There must first be a breach of duty and
not the result of a violation of a legal duty. imposition of liability before damages may
• Damage results from a person's exercising be awarded.
his legal rights.
• Although there was physical damage, there Note: The injured person alone bears the
was no legal injury as there was no violation consequences because the law affords no
of legal right. remedy for damages resulting from an act that
• A person may have suffered physical hurt or does not amount to a legal injury or wrong.
injury, but for as long as no legal injury or
wrong has been done, there is no liability. RICO v. UNION BANK OF THE
• There is no liability even if there is damage PHILIPPINES
because there was no injury. G.R. No. 210928, February 14, 2022
• There can be damage without injury. J. Hernando
• In order that a plaintiff may maintain an Facts:
action for the injuries of which he complains, Union Bank issued Rico a Union Bank Visa
he must establish that such injuries resulted credit card with a credit limit of P150,000.00
from a breach of duty which the defendant and cash advance limit of P75,000.00. Rico
owed to the plaintiff. averred that Union Bank dishonored his credit
• Custodio v CA – However, the mere fact that card for alleged non-payment of overdue
the plaintiff suffered losses does not give account which consequently caused his card
rise to a right to recover damages. To to be declined when he tried to pay for his bill
warrant the recovery of damages, there must at Gourdo's Restaurant. Rico claimed that his
be both a right of action for a legal wrong SOA dated November 15, 2005 stated a
inflicted by the defendant, and damage balance of P1,228.84 when he did not use his
resulting to the plaintiff therefrom. Wrong
credit card during the covered billing period.
without damage, or damage without wrong,
Rico maintained that he suffered
does not constitute a cause of action, since
embarrassment, social humiliation, mental
damages are merely part of the remedy
anguish, serious anxieties, besmirched
allowed for the injury caused by a breach or
reputation, and wounded feelings when his
wrong.
card was dishonored at Gourdo' s Restaurant.
Issue: CONTRIBUTORY NEGLIGENCE

WoN Rico is entitled to moral damages, • An example of a partial defense
exemplary damages and attorney's fees due to • It is conduct on the part of the injured party,
the alleged gross negligence of Union Bank when contributing as a legal cause to the harm he
it dishonored Rico's credit card purchase has suffered, which falls below the standard
request, which caused him embarrassment and to which he is required to conform for his own
humiliation in the restaurant. protection.
• This is stated in Article 2179 of the Civil
Ruling: Code.
We find the disapproval of Rico's credit card as • This is also reiterated in Article 2214 of the
justified and done in good faith. Union Bank Civil Code
neither breached its contract with Rico nor acted
with willful intent to cause harm when it revoked Art. 2179. When the plaintiff’s own negligence
Rico's credit card privileges when he failed to pay was the immediate and proximate cause of his
the minimum amount due on his SOA dated injury, he cannot recover damages. But if his
October 16, 2005. Nobody can be faulted for negligence was only contributory, the immediate
Rico's alleged humiliation or embarrassment in and proximate cause of the injury being the
Gourdo's Restaurant but himself. Damnum defendant’s lack of due care, the plaintiff may
absque injuria - there can be no damage without recover damages, but the courts shall mitigate
injury when the loss or harm was not the result of the damages to be awarded.
a violation of a legal duty.
Art. 2214. In quasi-delicts, the contributory
In order for Rico to maintain an action for the negligence of the plaintiff shall reduce the
injuries which he claims to have sustained, he damages that he may recover.
must establish that such injuries resulted from a
breach of duty which Union Bank owed to him. Extent of Mitigation
In other words, there must be a concurrence of It is left to the discretion of the court to determine
injury to Rico and the legal responsibility of the the extent of the mitigation of the defendant’s
person causing it, i.e. Union Bank. "The liability depending on the circumstances.
underlying basis for the award of tort damages is
the premise that an individual was injured in ‘Complete Defense’ defined
contemplation of law; thus there must first be a Defense that completely bar recovery.
breach before damages may be awarded and the
breach of such duty should be the proximate Examples Defenses
cause of the injury.“ I. Assumption of Risk
• Doctrine of Assumption of Risk is consistent
It is not enough that Rico merely suffered with the Latin maxim volenti non fit injuria.
humiliation or embarrassment as a result of • The risk of a known danger.
Union Bank's disapproval of the credit card • The general principle underlying the defense
transaction on November 20, 2005. "It is also of assumption of risk is that a plaintiff who
required that a culpable act or omission was voluntarily assumes a risk of harm arising
factually established, that proof that the wrongful from the negligent or reckless conduct of the
act or omission of the defendant is shown as the defendant cannot recover for such harm.
proximate cause of the damage sustained by the
claimant and that the case is predicated on any Elements of Assumption of Risk
of the instances expressed or envisioned by Arts.
a. The plaintiff must know that the risk is
2219 and 2220 of the Civil Code."
present.
b. The plaintiff must further understand its
I. DEFENSES nature.
c. The choice to incur it is free and voluntary.
i. Due Diligence to prevent the Damage under
Article 2180
ESTERIA F. GARCIANO vs. CA
ii. Acts of Public Officers in the performance of
G.R. No. 96126 August 10, 1992
his official duties
Ruling:
iii. Authority of the law under Art 5 of the NCC
Liability for damages under Articles 19, 20 and
and Art 11 of the RPC
21 of the Civil Code arises only from unlawful,
iv. Damnum Absque Injuria
willful or negligent acts that are contrary to law,
v. Plaintiff’s negligence is the proximate cause
or morals, good customs or public policy.
vi. Contributory negligence of the Plaintiff
vii. Fortuitous Event
Art. 19. Every person must, in the exercise of
viii. Plaintiff’s assumption of risk
his rights and in the performance of his duties,
ix. Prescription
act with justice, give everyone his due, and
x. Waiver
observe honesty and good faith.
xi. Emergency Rule or Sudden Peril
Art. 20. Every person who, contrary to law, Thus, the threshold issue is whether or not
willfully or negligently causes damage to Ruby Lim acted abusively in asking Roberto
another, shall indemnify the latter for the same. Reyes, a.k.a. "Amay Bisaya," to leave the
party where he was not invited by the
Art. 21. Any person who willfully causes loss celebrant thereof thereby becoming liable
or injury to another in a manner that is contrary under Articles 19 and 21 of the Civil Code.
to morals, good customs or public policy shall Parenthetically, and if Ruby Lim were so liable,
compensate the latter for the damage. whether or not Hotel Nikko, as her employer, is
solidarily liable with her
The Court of Appeals was correct in finding
BAR QUESTION (2012)
that petitioner's discontinuance from teaching
was her own choice. While the respondents Roberto was in Nikko Hotel when he bumped into
admittedly wanted her service terminated, they a friend who was then on her way to a wedding
actually did nothing to physically prevent her reception being held in said hotel. Roberto
from reassuming her post, as ordered by the alleged that he was then invited by his friend to
school's Board of Directors. That the school join her at the wedding reception and carried the
principal and Fr. Wiertz disagreed with the basket full of fruits which she was bringing to the
affair. At the reception, the wedding coordinator
Board's decision to retain her, and some
of the hotel noticed him and asked him, allegedly
teachers allegedly threatened to resign en
in a loud voice, to leave as he was not in the
masse, even if true, did not make them liable guest list. He retorted that he had been invited to
to her for damages. They were simply the affair by his friend, who however denied
exercising their right of free speech or their doing so. Deeply embarrassed by the incident,
right to dissent from the Board's decision. Roberto then sued the hotel for damages under
Their acts were not contrary to law, morals, Articles 19 and 21 of the Civil Code. Will
good customs or public policy. They did not Roberto’s action prosper? Explain.
"illegally dismiss" her for the Board's decision SUGGESTED ANSWER
to retain her prevailed. She was ordered to
report for work on July 5, 1982, but she did not It depends. While the hotel has the right to
comply with that order. Consequently, exclude an uninvited guest from the wedding
whatever loss she may have incurred in the reception, that does not give the hotel the license
form of lost earnings was self-inflicted. Volenti to humiliate Roberto. If the wedding coordinator
of the hotel acted wrongfully e.g. with abuse of
non fit injuria.
right, unfairly, or in a manner that exposed
Roberto to unnecessary ridicule or shame, his
NIKKO HOTEL MANILA GARDEN vs. action will proper. Otherwise, Roberto’s action
ROBERTO REYES, a.k.a. "AMAY BISAYA" will prosper. The hotel is liable for the wrongful
G.R. No. 154259, February 28, 2005 acts of its employees.
Ruling:
Petitioners Lim and Hotel Nikko contend that FORTUITOUS EVENT
pursuant to the doctrine of volenti non fit Art. 1174. Except in cases expressly specified
injuria, they cannot be made liable for by the law, or when it is otherwise declared by
damages as respondent Reyes assumed the stipulation, or when the nature of the obligation
risk of being asked to leave (and being requires the assumption of risk, no person shall
embarrassed and humiliated in the process) as be responsible for those events which could not
he was a "gate-crasher.“ be foreseen, or which, though foreseen, were
inevitable.
The doctrine of volenti non fit injuria ("to which
a person assents is not esteemed in law as Essential Characteristics of a Fortuitous
injury" ) refers to self-inflicted injury or to the Event
consent to injury which precludes the recovery a. The cause of the unforeseen and
of damages by one who has knowingly and unexpected occurrence, or of the failure of
voluntarily exposed himself to danger, even if the debtor to comply with his obligation, must
he is not negligent in doing so. b independent of human will.
b. It must be impossible to foresee the event
As formulated by petitioners, however, this which constitutes the ‘caso fortuito’ or if it
doctrine does not find application to the case can be foreseen, it must be impossible to
at bar because even if respondent Reyes avoid.
assumed the risk of being asked to leave the c. The occurrence must be such as to render it
party, petitioners, under Articles 19 and 21 of impossible for the debtor to fulfill his
the New Civil Code, were still under obligation obligation in a normal manner.
to treat him fairly in order not to expose him to d. The obligor must be free from any
participation in the aggravation of the injury
unnecessary ridicule and shame.
resulting to the creditor.
BAR QUESTION (2002) PRESCRIPTION

An action based on quasi-delict prescribes in
A van owned by Orlando and driven by Diego,
four years from the date of the accident. (Article
while negotiating a downhill slope of a city road,
1146 Civil Code)
suddenly gained speed, obviously beyond the
authorized limit in the area, and bumped a car in
SUDDEN EMERGENCY RULE
front of it, causing severed damage to the care
The sudden emergency rule was enunciated by
and serious injuries to its passengers. Orlando
this Court in Gan v. Court of Appeals, thus:
was not in the car at the time of the incident.
[O]ne who suddenly finds himself in a place of
The car owner and the injured passengers sued
Orlando and Diego for damages caused by
danger, and is required to act without time to
Diego’s negligence. In their defense, Diego consider the best means that may be adopted to
claims that the downhill slope caused the van to avoid the impending danger, is not guilty of
gain speed and that, as he stepped on the negligence if he fails to adopt what subsequently
brakes to check the acceleration, the brakes and upon reflection may appear to have been a
locked, causing the van to go even faster and better method unless the emergency in which he
eventually to hit the car in front of it. Orlando finds himself is brought about by his own
and Diego contend that the sudden malfunction negligence.
of the van’s brake system is a fortuitous even
and that, therefore, they are exempt from any J. NEGLIGENCE
liability. Is this contention tenable? Explain • It is the failure to observe for the protection of
SUGGESTED ANSWER the interest of another that degree of care,
precaution, and vigilance that the
No. Mechanical defects of a motor vehicle do circumstances justly demand.
not constitute fortuitous event, since the • Negligence is the omission to do something
presence of such defects would have been which a reasonable man, guided upon those
readily detected by diligent maintenance check. considerations which ordinarily regulate the
The failure to maintain the vehicle in safe conduct to human affairs, would do, or doing
running condition constitutes negligence. something which a prudent and reasonable
man would not do.
BAR QUESTION (2014) • ARTICLE 1173. The fault or negligence of the
obligor consists in the omission of that
Mabuhay Elementary School organized a field diligence which is required by the nature of
trip for its Grade VI students in Fort Santiago, the obligation and corresponds with the
Manila Zoo, and Star City. To be able to join, the circumstances of the persons, of the time and
parents of the students had to sign a piece of of the place. When negligence shows bad
paper that reads as follows: "I allow my child faith, the provisions of articles 1171 and 2201,
(name of student), Grade – Section, to join the paragraph 2, shall apply.
school’s field trip on February 14, 2014. I will not • If the law or contract does not state the
file any claim against the school, administrator diligence which is to be observed in the
or teacher in case something happens to my performance, that which is expected of a
child during the trip." Joey, a 7-year-old student good father of a family shall be required.
of Mabuhay Elementary School was bitten by a
snake while the group was touring Manila Zoo. General Rule: The party who relies on
The parents of Joey sued the school for negligence for his cause of action has the
damages. The school, as a defense, presented burden of proving the existence of the same,
the waiver signed by Joey’s parents. otherwise his action fails.
Was there a valid waiver of right to sue the
school? Why?
Requisites to determine whether the person
SUGGESTED ANSWER has been negligent:
i. The diligence required under the
No, there was no valid waiver of the right to sue circumstances
the school. A waiver to be valid must have three ii. Whether the diligence required has been
requisites 1) existence of the right; 2) legal performed.
capacity of the person waiving the right and 3)
the waiver must not be contrary to law, morals,
Test of Negligence
good customs, public order or public policy or
• Did the defendant in doing the alleged
prejudicial to a third person with a right
negligent act use the reasonable care and
recognized by law. In the case presented, the
caution which an ordinarily prudent person
waiver may be considered contrary to public
would have used in the same situation?
policy as it exonerates the school from liability
• If not, then he is guilty of negligence.
for future negligence. The waiver in effect allows
the school to not exercise even ordinary
diligence.
Reasonable foresight XPN: When the rules or the law provides for
• What an ordinarily prudent man will do under cases when negligence is presumed.
the same circumstances can be determined a. Presumptions of Negligence
by asking the following: b. Res Ipsa Loquitur
• Could a prudent man, in the case under
consideration, foresee harm as a result of the (i) General Rule: Owner is solidarily liable with
course pursued? his driver, if the former, who was in the vehicle,
• If so, it was the duty of the actor to take could have, by the use of the due diligence,
precautions to guard against harm prevented the misfortune.
XPN: If the owner was not in the motor vehicle,
Circumstances to consider in determining Article 2184 does not apply. The provisions of
negligence: Article 2180 are applicable. [Article 2184]
1. Time
2. Place (ii) General Rule: Presumed that a person
3. Emergency Rule driving a motor vehicle has been negligent if at
4. Gravity of Harm to be Avoided the time of the mishap, he was violating any
5. Alternative Course of Action traffic regulation.
6. Social value or utility of the activity XPN: Unless there is proof to the contrary.
7. Person exposed to the risk [Article 2185]
1. STANDARD OF CARE (iii) General Rule: Prima facie presumption of

It is the degree of care or competence that one negligence of the defendant arises if death or
is expected to exercise in a particular injury results from his possession of dangerous
circumstance or role. weapons or substance.
XPN: When such possession or use is
What is the Standard of Care in the indispensable to his occupation or business.
Philippines? [Article 2188]
‘Pater Familias’ defined
the male head of a household; the father of a (iv) General Rule: Presumption of negligence of
family the common carrier arises in case of loss,
destruction or deterioration of the goods, or in
Concept of pater familias case of death or injury of passengers.
• Embodied in Article 2180 of the Civil Code XPN: Upon proof of exercise of extraordinary
diligence. [Article 1735]
Art. 2180. The responsibility treated of in this
article shall cease when the persons herein Presumptions of Negligence
mentioned prove that they observed all the 1. In motor vehicle mishaps, the owner is
diligence of a good father of a family to prevent presumed negligent if he was in the vehicle
damage. and he could have used due diligence to
• It is quasi-delictual or tortuous in character. prevent the misfortune. (Art. 2184 Civil Code)
• “The diligence of a good father of a family” 2. It is disputably presumed that a driver was
• A good father of a family means a person of negligent if he had been found guilty of
ordinary or average diligence. reckless driving or violating traffic regulations
• The law presumes or requires a man to at least twice for the next preceding two
possess ordinary capacity to avoid harming months. (Article 2184 Civil Code)
his neighbors, unless a clear and manifest 3. The driver of a motor vehicle is presumed
incapacity is shown. negligent if at the time of the mishap, he was
violating any traffic regulation. (Article 2185
General Rule: If the diligence required to Civil Code)
comply with one's obligations is not stipulated in 4. Prima facie presumption of negligence of the
the law or contract, paterfamilias will follow. defendant arises if death or injury results from
[Article 1173] his possession of dangerous weapons or
substance.
2. PRESUMPTION OF NEGLIGENCE EXCEPTION: When such
Proof of Negligence possession or use is indispensable to his
General Rule: occupation or business. (Article 2188 Civil
• If the plaintiff alleged in his complaint that Code)
he was damaged because of the negligent 5. Presumption of negligence of the common
acts of the defendant, the plaintiff has the carrier arises in case of loss, destruction or
burden of proving such negligence. deterioration of the goods, or in case of death
• The quantum of proof required is or injury of passengers.
preponderance of evidence (Rule 133 EXCEPTION: Upon proof of exercise of
Revised Rules of Court) extraordinary diligence.
BAR QUESTION (1996) ‘DAMAGE’ DEFINED AS OPPOSED TO

‘DAMAGES’
Marcial, who does not know how to drive, has • Damage is the loss, injury, or deterioration
always been driven by Ben, his driver of ten caused by negligence or accident of one
years whom he had chosen carefully and has person to another with respect to another’s
never figured in a vehicular mishap. One day, property. Damage is the occasion of
Marcial was riding at the back seat of his damages.
Mercedes Benz being driven along EDSA by • Damages is the compensation in money for
Ben. Absorbed in reading a book, Marcial did
the loss or damage. It is an adequate
not notice that they were approaching the corner
compensation for the value of loss suffered or
of Quezon Avenue, when the traffic light had
profits which the oblige failed to obtain.
just turned yellow. Ben suddenly stepped on
• Indemnification is meant to compensate for
the gas to cross the intersection before the
the injury inflicted and not to impose a
traffic light could turn red. But, too late. Midway
penalty. A party is entitled to adequate
in the intersection, the traffic light changed, and
compensation only for such pecuniary loss
a Jeepney full of passengers suddenly crossed
actually suffered and duly proved.
the car’s path. A collision between the two
vehicles was inevitable. As a result, several
jeepney passengers were seriously injured. A 1. KINDS OF DAMAGES
suit for damages based on culpa aquiliana Damages may be:
was filed against Marcial and Ben, seeking to a. Actual or compensatory;
hold them jointly and severally liable for such b. Moral;
injuries. c. Nominal;
May Marcial be held liable? Explain. d. Temperate or moderate;
e. Liquidated; or
SUGGESTED ANSWER f. Exemplary or corrective. [2197]
Yes, Marcial should be held liable.
Art. 2164 NCC makes an owner of a motor (a) Actual or Compensatory
vehicle solidarily liable with the driver if, being in ‘Actual and Compensatory Damages’ defined
the vehicle at the time of the mishap, he could • It is compensation for an injury that will put
have prevented it by the exercise of due the injured party in the position where it was
diligence. The traffic conditions along EDSA at before the injury. They pertain to such injuries
any time of day or night are such as to require or losses that are actually sustained and
the observance of utmost care and total susceptible of measurement."
alertness in view of the large number of vehicles • Actual damages constitute compensation for
running at great speed. Marcial was negligent in sustained pecuniary loss.
that he rendered himself oblivious to the traffic • Nevertheless, a party may only be awarded
hazards by reading a book instead of focusing actual damages when the pecuniary loss he
his attention on the road and supervising the or she had suffered was duly proven.
manner in which his car was being driven. Thus,
he failed to prevent his driver from attempting to Kinds of Actual/Compensatory Damages (Art
beat the traffic light at the junction of Quezon 2200)
Avenue and EDSA, which Marcial, without being 1. The loss of what a person already
a driver himself could have easily perceived as possesses or the loss suffered or actual loss.
a reckless course of conduct. (daño emergente/damnun emergens)
2. The unrealized profits or the profits which the
MALAYAN INSURANCE CO., VS. ALBERTO complainant failed to obtain by reason of the
G.R. No. 194320, February 1, 2012 breach of contract or as a result of the
It is worth mentioning that just like any other commission of a quasi-delict (lucro cesante)
disputable presumptions or inferences, the
presumption of negligence may be rebutted or Requisites
overcome by other evidence to the contrary. a. Must be pleaded and proved with certainty
b. Must pray for the relief that claim for loss be
granted
K. DAMAGES c. Plaintiff must prove the loss
Damages Defined Classes of Actual Damages

• Damages are the recompense or a. Value of actual loss
compensation awarded for the damage b. Lucrum Cesans (Loss of Profits)
suffered. c. Loss of earning capacity
• Indemnification is meant to compensate for d. Interest
the injury inflicted and not to impose a e. Injury to business standing or commercial
penalty. A party is entitled to adequate credit
compensation only for such pecuniary loss f. Attorney’s fees
actually suffered and duly proved. g. Indemnity for death
Extent and Measure of Damages The case clearly involves a quasi-delict where
In Contracts and Quasi Contracts (Art 2201) my client, the bicycle rider, suffered injury as a
i. Obligor in good faith – Liable for result of the negligence of the over- speeding
damages that are natural and probable taxi driver, without fault on my client’s part. To
consequences of the breach, and which prove actual damages, aside from the testimony
the parties have foreseen. of my client, I will present his hospital and
ii. Obligor in bad faith – Responsible for all medical bills. Receipts of the fees paid on the
damages which may be reasonably rehabilitation will also be presented.
attributed to the non-performance of the Furthermore, I will present income tax returns,
obligation. contracts and other documents to prove
unrealized profits as a result of his temporary
In Crimes and Quasi Delicts (Art 2202) injury. I will also call the attending physician to
i. Limited to a fair compensation for the harm testify as to the extent of the injuries suffered by
done in case of tortious injury my client, and to corroborate the contents of the
ii. Same as the rule in measuring damages in medical documents. Based on Article 2202, in
contracts and quasi-contracts where the quasi-delicts, the defendant shall be liable for all
obligor acted in good faith, except that the damages which are the natural and probable
accused or defendant must answer for consequences of the act or omission
such damages whether he has foreseen complained of. It is not necessary that such
them or not. damages have been foreseen or could have
iii. Accused/defendant is responsible not only been foreseen by the defendant.
for the natural and probable consequences
of his act or omission but for all damages Attorney’s Fees and Litigation Expenses
which may be reasonably attributed General Rule: If there is no stipulation, then
thereto. it cannot be recovered.
BAR QUESTION (2013) XPN: It may be recovered in the following
cases:
A collision occurred at an intersection involving 1. When exemplary damages are
a bicycle and a taxicab. Both the bicycle rider (a
awarded;
businessman then doing his morning exercise)
and the taxi driver claimed that the other was at 2. When the defendant’s act or omission
fault. Based on the police report, the bicycle has compelled the plaintiff to litigate
crossed the intersection first but the taxicab, with third persons or to incur expenses
crossing at a fast clip from the bicycle's left, to protect his interest;
could not brake in time and hit the bicycle's rear 3. In criminal cases of malicious
wheel, toppling it and throwing the bicycle rider prosecution against the plaintiff;
into the sidewalk 5 meters away. The bicycle 4. In case of a clearly unfounded civil
rider suffered a fractured right knee, sustained action or proceeding against the
when he fell on his right side on the concrete
plaintiff;
side walk. He was hospitalized and was
subsequently operated on, rendering him 5. Where the defendant acted in gross
immobile for 3 weeks and requiring physical and evident bad faith in refusing to
rehabilitation for another 3 months. In his satisfy the plaintiff’s plainly valid, just
complaint for damages, the rider prayed for the and demandable claim;
award ofP1,000,000 actual damages, P200,000 6. In actions for legal support;
moral damages, P200,000 exemplary damages, 7. In actions for the recovery of wages of
P100,000 nominal damages and P50,000 household helpers, laborers and skilled
attorney's fees. Assuming the police report to be workers;
correct and as the lawyer for the bicycle rider,
8. In actions for indemnity under
what evidence (documentary and testimonial)
and legal arguments will you present in court to workmen’s compensation and
justify the damages that your client claims? (8%) employer’s liability laws;
9. In a separate civil action to recover civil
SUGGESTED ANSWER liability arising from a crime;
I will base the claim of my client on quasi- delict 10. When at least double judicial costs are
under Article 2176 of the Civil Code of the awarded;
Philippines. The requisites for a claim under 11. In any other case where the court
quasi-delict to prosper are as follows: deems it just and equitable that
1. Act or omission, there being fault and attorney’s fees and expenses of
negligence;
litigation should be recovered. [Article
2. Damage or injury; and
3. Causal connection between the damage and 2208]
the act or omission. Note: The attorney’s fees and expenses of
litigation must be reasonable.
S.C. MEGAWORLD CONSTRUCTION AND 3. Compounded Interest

DEVELOPMENT VS. PARADA • This is applicable to both monetary and non-
G.R. No. 183804, September 11, 2013 monetary obligations;
Attorney’s fees as part of damages are not • 6% per annum computed against award of
meant to enrich the winning party at the damages (interest) granted by the court. To
expense of the losing litigant. They are not be computed from the date when the court’s
awarded every time a party prevails in a suit decision becomes final and executory until
because of the policy that no premium should the award is fully satisfied by the losing
be placed on the right to litigate. The award of party.
attorney’s fees is the exception rather than the
general rule. As such, it is necessary for the 4. The 6% per annum rate of legal interest
trial court to make findings of facts and law that shall be applied prospectively:
would bring the case within the exception and • Final and executory judgments awarding
justify the grant of such award. The matter of damages prior to July 1, 2013 shall apply the
attorney’s fees cannot be mentioned only in the 12% rate;
dispositive portion of the decision. They must • Final and executory judgments awarding
be clearly explained and justified by the trial damages on or after July 1, 2013 shall apply
court in the body of its decision. the 12% rate for unpaid obligations until
June 30, 2013; unpaid obligations with
Interest respect to said judgments on or after July 1,
• Award of interest in the concept of actual 2013 shall still incur the 6% rate.
and compensatory damages actual
damages. (b) Moral Damages
• The rate of interest, as well as the accrual • These are compensatory damages awarded
thereof is imposed as follows, following for mental pain and suffering or mental
Nacar v Gallery Frames based on BSP MB anguish resulting from a wrong.
Resolution No. 796 dated June 21, 2013. • Not punitive in nature.
• Bangko Sentral ng Pilipinas Monetary Board • Designed to compensate and alleviate in
Resolution No. 796 lowered the legal rate of some way the physical suffering, mental
interest from 12% to 6%. Specifically, the anguish, fright, serious anxiety, besmirched
rules on interest are now as follows: reputation, wounded feelings, moral shock,
social humiliation, and similar injury unjustly
1. Monetary Obligations caused a person.
ex. Loans: • May be recovered if they are the proximate
a. If interest stipulated in writing: result of the defendant’s wrongful act or
i. rate of interest shall be that amount omission.
stipulated
ii. interest due shall earn legal interest Moral Damages include:
of 6% from date of judicial demand 1. Physical suffering
(filing of the case) 2. Mental anguish
b. if not stipulated in writing 3. Fright
i. shall run from date of default (either 4. Serious anxiety
failure to pay upon extra-judicial 5. Besmirched reputation
demand or upon judicial demand 6. Wounded feelings
whichever is appropriate and 7. Moral shock
subject to the provisions of Article 8. Social humiliation
1169 of the Civil Code) 9. Similar injury. [Article 2217]
ii. rate of interest shall be 6% per
annum Computation for the Award of Moral
Damages
2. Non-Monetary Obligations • Moral damages is incapable of pecuniary
a. If already liquidated, rate of interest shall computation;
be 6% per annum, demandable from date • Nevertheless, it must somehow be
of judicial or extra-judicial demand (Art. proportional to and in approximation of the
1169, Civil Code) suffering inflicted.
b. If unliquidated, no interest
XPN: When later on established with Rationale: This is so because moral damages
certainty. Interest shall still be 6% per are in the category of an award designed to
annum demandable from the date of compensate the claimant for actual injury
judgment because on such date, it is suffered, not to impose a penalty on the
already deemed that the amount of wrongdoer.
damages is already ascertained.
Art. 2218. In the adjudication of moral c. Culpa Criminal

damages, the sentimental value of property, • Moral damages could be lawfully due
real or personal, may be considered. when the accused is found guilty of
physical injuries, lascivious acts, adultery
Cases Wherein Moral Damages May be or concubinage, illegal or arbitrary
Recovered detention, illegal arrest, illegal search, or
1. A criminal offense resulting in physical defamation. Malicious prosecution can
injuries; also give rise to a claim for moral
2. Quasi-delicts causing physical injuries; damages.
3. Seduction, abduction, rape, or other BAR QUESTION (1992)
lascivious acts;
4. Adultery or concubinage; As the result of a collision between a public
5. Illegal or arbitrary detention or arrest; service passenger bus and a cargo truck
6. Illegal search; owned by D, X sustained physical injuries and
Y died. Both X and Y were passengers of the
7. Libel, slander or any other form of
bus. Both drivers were at fault, and so X and Z,
defamation;
the only heir and legitimate child of the
8. Malicious prosecution;
deceased Y, sued the owners of both vehicles.
9. Acts mentioned in article 309;
a) May the owner of the bus raise the
10. Acts and actions referred to in articles 21, defense of having exercised the diligence
26, 27, 28, 29, 30, 32, 34, and 35. of a good father of a family?
b) May D raise the same defense?
Instances when moral damages may be c) May X claim moral damages from both
awarded without evidence of Injury: defendants?
i. Rape Cases d) May Z claim moral damages from both
ii. Murder Cases defendants? Give reasons for all your
iii. Broadcast is libelous per se answers.
Rights of a Juridical Person to recover SUGGESTED ANSWER

moral damages (a) No. The owner of the bus cannot raise the
Generally, a juridical person is not entitled to defense because the carrier's liability is based
moral damages. on breach of contract
(b) Yes. D can raise the defense because his
Rationale: A corporation, being an artificial liability is based on a quasi-delict.
person and having existence only in legal (c) Because X suffered physical injuries, X can
contemplation, cannot experience physical claim moral damages against D since the
sufferings, mental anguish, fright, serious cause of action is based on quasi-delict. But as
anxiety, wounded feelings, moral shock, or against the owner of the passenger bus, X can
social humiliation which are basis of moral claim moral damages only if X proves reckless
damages. They can be experienced only by negligence of the carrier amounting to fraud
one having a nervous system; a corporation since the cause of action is based on culpa-
has “no feelings, no emotions, no senses. contractual.
(d) Z can claim moral damages against both
XPN: where the corporation has a good defendants because the rules on damages
reputation that is debased, resulting in its arising from death due to a quasi-delict are also
applicable to death of a passenger caused by
social humiliation.
breach of contract by a common carrier (Arts.
1755, 1756, 1764, 2206 and 2219, Civil Code).
Moral damages in a:
a. Quasi-Delict Conditions for the Award of Moral
• when an act or omission causes physical Damages
injuries, or; 1. There must be an injury, whether
• where the defendant is guilty of physical, mental or psychological, clearly
intentional tort. sustained by the claimant
b. Culpa Contractual 2. There must be a culpable act or omission
• When the defendant acted in bad faith or factually established
was guilty of gross negligence 3. The wrongful act or omission of the
(amounting to bad faith) or in wanton defendant is the proximate cause of the
disregard of his contractual obligation injury sustained by the claimant;
and, exceptionally, when the act of 4. The award of damages is predicated on
breach of contract itself is constitutive of any of the cases stated in Article 2219
tort resulting in physical injuries.
(c) Nominal Damages • Thus, in Tan v. OMC Carriers, Inc.,

• Recoverable where a legal right is technically temperate damages were rightly awarded
violated and must be vindicated against an because plaintiff suffered a loss, although
invasion that has produced no actual present definitive proof of its amount cannot be
loss of any kind, or where, from the nature of presented as the photographs produced as
the case, there has been some injury arising evidence were deemed insufficient.
from a breach of contract or legal duty but the Established in that case, however, was the
amount thereof has not been or cannot be fact that respondent’s truck was responsible
shown. for the damage to petitioner’s property and
• It adjudicated in order that a right of the that petitioner suffered some form of
plaintiff, which has been violated or invaded pecuniary loss.
by the defendant, may be vindicated or • In Canada v. All Commodities Marketing
recognized, and not for the purpose of Corporation, temperate damages were also
indemnifying the plaintiff for any loss suffered awarded wherein respondent’s goods did not
by him. (Art. 2221) reach the Pepsi Cola Plant at Muntinlupa
City as a result of the negligence of
Elements petitioner in conducting its trucking and
a. Plaintiff has a right hauling services, even ifthe amount of the
b. Rights of plaintiff is violated
pecuniary loss had not been proven.
c. Purpose is to recognize the right violated.
• In Philtranco Services Enterprises, Inc. v.
Paras, the respondent was likewise awarded
(d) Temperate or Moderate Damages temperate damages in an action for breach
‘Temperate or Moderate Damages’ defined
of contract of carriage, even if his medical
Those that are more than nominal but less than
expenses had not been established with
compensatory damages [Article 2224]
certainty.
• In People v. Briones, in which the accused
When May Temperate Damages be
was found guilty of murder, temperate
Recovered
When some pecuniary loss has been suffered
damages were given even if the funeral
but its amount can not be proved with certainty. expenses for the victim had not been
sufficiently proven.
Awarding of Temperate Damages • Given these findings, we are of the belief
Must be reasonable under the circumstances that temperate and not nominal damages
[Article 2225] should have been awarded, considering that
it has been established that respondent
PHILTRANCO SERVICE ENTERPRISES, INC. herein suffered a loss, even if the amount
VS. PARAS G.R. No. 161909, April 25, 2012 thereof cannot be proven with certainty.
In awarding temperate damages in lieu of actual
damages, the CA did not err, because Paras (e) Liquidated Damages
and Inland were definitely shown to have ‘Liquidated Damages’ defined
sustained substantial pecuniary losses. Clearly, Liquidated damages are those agreed upon by
the costs of Paras’ surgeries and consequential the parties to a contract, to be paid in case of
rehabilitation, as well as the fact that repairing breach thereof.
Inland’s vehicle would no longer be economical
justly warranted the CA to calculate temperate When liquidated damages may be equitably
damages of ₱50,000.00 and ₱250,000.00 reduced:
respectively for Paras and Inland. i. In case of partial and irregular
performance
SEVEN BROTHERS SHIPPING CORP V. ii. In case it is iniquitous or unconscionable
DMC-CONSTRUCTION | G.R. NO. 193914
NOVEMBER 26, 2014 TAN VS. FIRST MALAYAN LEASING AND
• Temperate or moderate damages may be FINANCE CORP.
recovered when the court finds that some G.R. No. 254510, June 16, 2021
pecuniary loss has been suffered but its Computation for the Award of Liquidated
amount cannot, from the nature of the case,
Damages
be provided with certainty
The amount of the liquidated damages is purely
• Nominal damages are ‘recoverable where a
contractual between the parties. The courts will
legal right is technically violated and must be
intervene only to equitably reduce the
vindicated against an invasion that has
liquidated damages, whether intended as an
produced no actual present loss of any kind
indemnity or a penalty, if they are iniquitous or
or where there has been a breach of contract
and no substantial injury or actual damages
unconscionable.
whatsoever have been or can be shown.
(f) Exemplary or Corrective Damages MANILA ELECTRIC COMPANY

‘Exemplary or Corrective Damages’ (MERALCO) VS. AAA CYROGENICS
defined PHILIPPINES, INC.
• They are also known as “punitive” or G.R. No. 207429. November 18, 2020
“vindictive” damages. J. Hernando
• Exemplary damages are mere additions Facts:
which may or may not be granted at all • AAA was engaged in the production of
depending upon the necessity of setting an liquid forms of gasses, such as liquid
example for public good as a form of oxygen, liquid nitrogen and liquid argon.
deterrent to the repetition of the same act In the production of these products, the
by anyone.
plant facilities of AAA relied on computers
and electronic processors that required a
Art. 2229. Exemplary or corrective damages
very stable source of power, otherwise the
are imposed, by way of example or correction
whole plant would shut down and freeze
for the public good, in addition to the moral,
temperate, liquidated or compensatory up. A stable source of power was crucial
damages. to AAA's operations.
• Between October 1997 and April 1998,
Awarding of Exemplary or Corrective there were fluctuations and interruptions
Damages in the electrical power supplied by
a. Criminal Offenses - crime was Meralco. As a result, AAA suffered losses.
committed with one or more aggravating • AAA sent several letters informing
circumstances [Article 2230]. Meralco of its problems with respect to
b. Quasi-delicts - if the defendant acted the supply of power, but Meralco could
with gross negligence [Article 2231]. not remedy the situation, except to advise
c. Contract and Quasi-Contracts - if the AAA to install power conditioning
defendant acted in a wanton, fraudulent, equipment in the form of a motor
reckless, oppressive, or malevolent generator set in order to level out the
manner [Article 2232]. supply of power.
• In the meantime, AAA stopped paying its
Recovery of Exemplary Damages electrical bills. Meralco, thus,
This cannot be recovered as a matter of right; disconnected and terminated its service
the court will decide whether or not they contract with AAA. After deducting AAA's
should be adjudicated [Article 2233]. service and meter deposit and applying
interest charges, Meralco computed
Burden of Proof
AAA's unpaid bills to amount to
General Rule: The burden of proof is on the
P10,453,477.55.
plaintiff to show that he is entitled to moral,
Issue:
temperate or compensatory damages before
the court may consider the question of WoN Meralco is liable for damages
whether or not exemplary damages should be Ruling:
awarded. [Article 2234] Under Article 2199 of the Civil Code,
"[e]xcept as provided by law or by
Is a person allowed to renounce exemplary stipulation, one is entitled to an adequate
damages? compensation only for such pecuniary loss
General Rule: A stipulation whereby suffered by [them] as [they have] duly
exemplary damages are renounced in proved." Jurisprudence instructs that "[t]he
advance shall be null and void [Article 2235 of claimant must prove the actual amount of
the Civil Code]. loss with a reasonable degree of certainty
premised upon competent proof and on the
RANA VS. WONG best evidence obtainable.”
G.R. No. 192861, June 30, 2014
Rationale Behind Exemplary Damages Under Article 2224 of the Civil Code,
The Court deems that an award of exemplary "[t]emperate or moderate damages, which
damages would be inappropriate since these are more than nominal but less than
damages are imposed only "by way of compensatory damages, may be recovered
example or correction for the public good, in when the court finds that some pecuniary
addition to the moral, temperate, liquidated or loss has been suffered but its amount
compensatory damages.“ cannot, from the nature of the case, be
provided with certainty."
The calculation of temperate damages is Issue:

usually left to the sound discretion of the courts. WoN KLM acted in gross negligence, bad faith
We observe the limit that in giving recompense, and willfull misconduct in relation to the loss of
the amount must be reasonable, bearing in Dr. Tiongco's suitcase so that the latter can be
mind that the same should be more than entitled to award of damages.
nominal, but less than compensatory. In
jurisprudence, this Court has pegged temperate Ruling:
damages to an amount equivalent to a certain KLM acted in bad faith. Dr. Tiongco's luggage
percentage of the actual damages claimed by went missing during his flight. Even after his
the injured party. Given the foregoing return to the Philippines, Dr. Tiongco's suitcase
circumstances, We find three-fourths of AAA's was still missing. Nobody from KLM's personnel
claim, or P15,819,570.00, to be in order. updated him of what happened to the search. It
was only when Dr. Tiongco wrote KLM a
The award of exemplary damages and the demand letter that the latter reached out to him
deletion of attorney's fees have factual and asking for time to investigate the matter. Yet, it
legal basis. As to the grant of exemplary did not even notify him of the result of the
damages, We find that the same was properly purported investigation.
awarded by the CA. The records show that
despite Meralco's repeated assurance of better To make matters even worse, the Customer
electric supply, and despite knowledge of the Relations Officer of KLM, Arlene Almario,
serious production losses experienced by AAA categorically testified that the suitcase was
due to the power fluctuations and interruptions, eventually found in Almaty as shown in the
it still failed to provide any remedy, in wanton baggage report dated December 18, 1998 of
disregard of its contractual obligation to deliver Turkish Airlines. The said airline immediately
energy "at reasonably constant potential and notified KLM. However, KLM did not bother to
frequency." As a public utility vested with vital inform Dr. Tiongco that his suitcase had been
public interest, Meralco should be reminded of found or took the necessary steps to transport it
its "obligation to discharge its functions with back to Manila.
utmost care and diligence."
KLM's bad faith, gross negligence, and lack of
Finally, as to the CA's deletion of attorney's care warrant the award of moral damages in
fees, We see no reason to disturb the same. accordance with Article 2220 of the Civil Code
Jurisprudence instructs that "the award of to enable the injured party to obtain means of
attorney's fees is an exception rather than the diversion or amusement that will serve to
general rule; thus, there must be compelling alleviate the moral suffering they underwent
legal reason to bring the case within the because of another's culpable action. Here,
exceptions provided under Article 2208 of the KLM displayed indifference to the plight and
Civil Code to justify the award." We simply find inconvenience suffered by Dr. Tiongco when he
no compelling legal reason here. lost his luggage. It made empty promises that
his luggage would be travelling with him and
KLM ROYAL DUTCH AIRLINES v TIONGCO even failed to inform Dr. Tiongco that his
G.R. No. 212136, October 04, 2021 suitcase had been found. Moreover, it did not
J. Hernando return the luggage to him even after it was
Facts: found. Undoubtedly, KLM acted in a wanton,
Dr. Jose M. Tiongco, a prominent surgeon and and reckless manner. Given the surrounding
co-founder of the Medical Mission Group facts and circumstances in the instant case, the
Hospital and Health Services, was invited by Court holds that the amount of P100,000.00 is
sufficient for Exemplary damages.
the UN-WHO to be a keynote speaker at the
20th Anniversary of the Alma-Ata Declaration in
Temperate damages are awarded when the
Almaty, Kazakhstan. He secured his visa and
injured party suffered some pecuniary loss. Dr.
purchased tickets for his flights, which included
Tiongco incurred pecuniary loss when his
multiple connections. However, due to flight
suitcase containing his personal belongings was
delays and missed connections, Dr. Tiongco's
lost during his flight and was never returned.
checked-in suitcase, containing his speech,
Verily, the Court finds the award of P50,000.00
resource materials, and personal items, went
as temperate damages fair and reasonable in
missing. Despite his inappropriate attire, he
view of the circumstances in this case.
managed to deliver his speech without visual
aids. Upon returning to the Philippines, three
The amount of attorney's fees, equivalent to
months later, there was still no news about his
20% of the total amount of the awards adjudged
lost luggage.
to Dr. Tiongco is also proper for being
reasonable and just.
BAR QUESTION (1994) L. DAMAGES IN CASE OF

On January 5, 1992, Nonoy obtained a
DEATH
loan of Pl,000,000.00 from his friend Raffy.
The promissory note did not stipulate any Art. 2206. The amount of damages for death
caused by a crime or quasi-delict shall be at
payment for Interest. The note was due on
January 5, 1993 but before this date the two least three thousand pesos, even though there
became political enemies. Nonoy, out of spite, may have been mitigating circumstances. In
deliberately defaulted in paying the note, thus addition:
forcing Raffy to sue him. (1) The defendant shall be liable for the loss of
1) What actual damages can Raffy recover? the earning capacity of the deceased, and
the indemnity shall be paid to the heirs of
2) Can Raffy ask for moral damages from
Nonoy? the latter; such indemnity shall in every
3) Can Raffy ask for nominal damages? case be assessed and awarded by the
court, unless the deceased on account of
4) Can Raffy ask for temperate damages?
5) Can Raffy ask for attorney’s fees? permanent physical disability not caused
by the defendant, had no earning capacity
SUGGESTED ANSWER at the time of his death;
(2) If the deceased was obliged to give
(1) Raffy may recover the amount of the
support according to the provisions of
promissory note of P1 million, together with
Article 291, the recipient who is not an heir
interest at the legal rate from the date of judicial
called to the decedent's inheritance by the
or extrajudicial demand. In addition, however,
law of testate or intestate succession, may
inasmuch as the debtor is in bad faith, he is
demand support from the person causing
liable for all damages which may be reasonably
the death, for a period not exceeding five
attributed to the non-performance of the
years, the exact duration to be fixed by the
obligation. (Art. 2201(2), NCC).
court;
(3) The spouse, legitimate and illegitimate
2) Yes, under Article 2220, NCC moral
descendants and ascendants of the
damages are recoverable in case of breach of
deceased may demand moral damages for
contract where the defendant acted
mental anguish by reason of the death of
fraudulently or in bad faith.
the deceased.
3) Nominal damages may not be recoverable
PEOPLE VS. TOLENTINO
in this case because Raffy may already be
G.R. No. 176385, February 26, 2008
indemnified of his losses with the award of
When death occurs due to negligent act or
actual and compensatory damages.
crime, the following damages may be recovered:
NOMINAL DAMAGES are adjudicated only in
a. Civil indemnity for death
order that a right of the plaintiff, which has been
b. Actual or compensatory damages
violated or invaded by the defendant may be
c. Moral damages
vindicated or recognized, and not for the
d. Exemplary damages
purpose of indemnifying the plaintiff for any
e. Attorney’s fees and expenses of litigation
loss suffered by him. (Article 2231, Civil Code)
f. Interest
g. Temperate damage in lieu of actual
4) Raffy may ask for, but would most likely
damages.
not be awarded temperate damages, for the
reason that his actual damages may already be
PRIETO VS. CAJIMAT
compensated upon proof thereof with the
G.R. No. 214898. June 08, 2020
promissory note. TEMPERATE DAMAGES
J. Hernando
may be awarded only when the court finds that
Facts:
some pecuniary loss has been suffered but its
 Petitioner Rondal, Jr. was driving a red
amount cannot, from the nature of the case,
Yamaha tricycle with plate number BT
be proved with certainty. (Article 2224, Civil
9799 along the southbound lane of the
Code)
national highway of Barangay 2 Garreta,
Badoc, Ilocos Norte. Thereafter, petitioner
5) Yes, under paragraph 2, Article 2208 of the
Rondal, Jr. overtook two tricycles in front of
Civil Code, considering that Nonoy’s act or
him and occupied the northbound lane
omission has compelled Raffy to litigate to
which resulted in a head-on collision with a
protect his interests. Furthermore. attorneys’
black Yamaha "chop-chop" motorcycle
fees may be awarded by the court when it is
which was driven by Narciso Cajimat III
just and equitable. (Article 2208(11) Civil
(Cajimat III). As a result, Cajimat III
Code).
suffered a fractured skull which caused his
instantaneous death.
 A criminal case for Reckless Imprudence We likewise modify the award of exemplary
resulting in Homicide was filed against damages into P50,000.00 to recognize the
petitioner Rondal, Jr. before the Municipal reckless and imprudent manner in which
Circuit Trial Court (MCTC) of Badoc-Pinili, petitioners Prieto and Rondal, Jr. acted during
Badoc, Ilocos Norte docketed as Criminal the incident. These monetary awards shall earn
Case No. 2730-B. Meanwhile, the mother of interest at the rate of six percent (6%) per
deceased Cajimat III, respondent Erlinda, annum from date of finality of this judgment until
filed a separate civil action for damages fully paid.
before the RTC against petitioners Rondal, Jr.
and Prieto, the registered owner of the red The trial court's award of actual damages in the
Yamaha tricycle. amount of P30,000.00 must be modified. The
 The RTC, applying the principle of res ipsa settled rule is that when actual damages proven
loquitur, rendered a Decision finding by receipts during the trial amount to less than
petitioners Rondal, Jr. and Prieto negligent the sum allowed by the Court as temperate
and are therefore civilly liable. In addition, the damages, the award of temperate damages is
RTC reasoned that deceased Cajimat III justified in lieu of actual damages which is of a
cannot be considered contributorily negligent lesser amount. Conversely, if the amount of
in the vehicular mishap as there was no actual damages proven exceeds, then
evidentiary proof that his motorcycle did not temperate damages may no longer be awarded;
have a headlight at the time of the collision. actual damages based on the receipts presented
 As to petitioner Prieto's civil liability under during trial should instead be granted. The
Article 2176 in relation to Article 2180 of the rationale for this rule is that it would be
Civil Code, the RTC ruled that as owner of a anomalous and unfair for the victim's heirs, who
public utility vehicle, he is solidarily liable as tried and succeeded in presenting receipts and
an employer of petitioner Rondal, Jr. other evidence to prove actual damages, to
 The RTC ordered petitioners to jointly and receive an amount which is less than that given
solidarily pay respondent Erlinda the as temperate damages to those who are not
following: (a) P29,000.00 as actual expenses; able to present any evidence at all. In the
(b) P50,000.00 as civil indemnity; (c) present case, Francisco's heirs were able to
P50,000.00 as moral damages; (d) prove, and were awarded, actual damages in the
P30,000.00 as exemplary damages; (e) amount of ₱30,000.00. Since, prevailing
P25,000.00 as attorney's fees; and (f) jurisprudence now fixes the amount of
P2,700.00 as cost of suit. ₱50,000.00 as temperate damages in murder
 The CA affirmed the RTC ruling. cases, the Court finds it proper to award
temperate damages to Francisco's heirs, in lieu
Issue: of actual damages.
• WoN the evidence presented is enough to
prove that the deceased was negligent in M. DUTY OF INJURED PARTY
driving his motorcycle.
• W/N the damages awarded must be modified. Doctrine of avoidable consequences
Art. 2203. The party suffering loss or injury must
Ruling: exercise the diligence of a good father of a
This Court finds no justifiable reason to deviate family to minimize the damages resulting from
from the findings of the RTC and the CA that no the act or omission in question.
sufficient evidence was presented by petitioners • Avoidable consequences doctrine is a legal
to prove that indeed Cajimat III's motorcycle had principle that places the responsibility of
no headlight and blinkers during the mishap. minimizing damages upon the person who
has been injured. The plaintiff after an injury
The monetary awards of (a) P50,000.00 as civil or breach of contract should make reasonable
indemnity; (b) P50,000.00 as moral damages; efforts to mitigate the effects of the injury or
(c) P25,000.00 as attorney's fees; and (d) breach.
P2,700.00 as cost of suit are correct and in • Damages resulting from avoidable
accord with recent jurisprudence. consequences of the breach of a contract or
other legal duty are not recoverable.
However, We deem it necessary to delete the
actual damages in the amount of P29,000.00 VELASCO VS. MANILA ELECTRIC CO.
and award P50,000.00 as temperate damages in G.R. No. L-18390, August 6, 1971
lieu thereof in conformity with prevailing Explanation of Art. 2203:
jurisprudence that when the actual damages is This codal rule clearly obligates the injured party
less than the sum allowed by the Court as to undertake measures that will alleviate and not
temperate damages, now pegged at aggravate his condition after the infliction of the
P50,000.00, the award of temperate damages is injury, and places upon him the burden of
justified in lieu of actual damages. explaining why he could not do so.
Duty-Bound to Carry the Burden of Proof

• The claimant is duty-bound to point out the
specific facts that afford a basis for measuring
whatever compensatory damages are borne.
• The burden of proof is on the party who would
be defeated if no evidence would be
presented on either side.
• The Injured Party must establish his case by
a preponderance of evidence which means
that evidence, as a whole, adduced by one
side is superior to that of the other.
• The claimant must prove the actual amount of
loss with reasonable certainty premised upon
competent proof and on the best evidence
obtainable.
SPS. RAMOS VS. OBISPO

G.R. No. 193804, February 27, 2013
In civil cases, basic is the rule that the party
making allegations has the burden of proving
them by a preponderance of evidence.
Moreover, parties must rely on the strength of
their own evidence, not upon the weakness of
the defense offered by their opponent. This
principle equally holds true, even if the
defendant had not been given the opportunity to
present evidence because of a default order.
This handout is a product of research using various Civil

Law Books from distinguished legal luminaries, as
follows:
• Civil Code of the Philippines Annotated by Justice Edgardo
L. Para's
• Compendium of Civil Law and Jurisprudence Justice Jose
Vitug
• Pre-week Companion to Civil Law Reviewer by Justice
Desiderio Jurado
• Jottings & Jurisprudence in Civil Law (Succession & Oblicon)
by Prof. Ruben Balance
• Civil Law Reviewer Volumes 1&2, Prof. Elmer Radula
• Quick Reviewer on the Law on Marriage and Family
Relations by Justice Priscilla J. Baltazar-Padilla
• Persons & Family Relations by Dean Melencio S. Sta. Maria
• Persons & Family Relations by by Justice Alicia Sempio-Dy
• Property by Dean Melencio S. Sta. Maria
• Comments and Cases on Property by Hector S. De Leon
• Succession in a Nutshell by Justice Alicia Simpao-Dy
• Notes and Cases on Succession by Dean Viviana Martin-
Paguirigan
• Wills and Succession Better Explained by Siegfried S. Mison
• The Law on Succession, Wills and Administration by Arturo
M. Tolentino
• Bar Q&A for the Past 10 Years, by Dean Viviana Martin-
Paguirigan
• UP Law Center Past Bar Exam Questions
Other internet resources such as:

• The LawPhil Project Bar Examinations Archive:
https://lawphil.net/courts/bm/barQ/barQs.html
• UST Faculty of Civil Law Compilation of Past Bar Exam
Questions and Answers: https://www.ustcivillaw.com/in-
focus/bar-qa-from-2009-2017/
• Civil Law Bar Exam Answers: Torts and Damages:
http://lawtechworld.com/blog/blog/2013/05/civil-law-bar-
exam-answers-torts-and-damages/
• Bar Examination Questions and Answers:
https://pdfcoffee.com/4a-bar-q-and-a-credit-transactions-
and-torts-and-damages-pdf-free.html
• 2019 Civil Law Bar Q and A:
https://lawstudentph.com/2019-civil-law-bar-q-and-a/
• Torts Bar Questions and Suggested Answers:
https://pdfcoffee.com/torts-bar-questions-and-suggested-
answers-pdf-free.html
• Suggested answers to the 2019 Bar Examinations in Civil
Law: https://lawstudentph.com/2019-civil-law-bar-q-and-
a/
And Bar Exam Memory Aids from various law schools

such as: San Beda, UP, Ateneo, UST, San Sebastian and
PUP, among others.

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JURISTS BAR REVIEW CENTER™

PERSONS AND FAMILY RELATIONS

K. Paternity and Filiation

PROPERTY, OWNERSHIP, AND ITS

II. BUNDLE OF RIGHTS

III.DIFFERENT MODES OF ACQUIRING

IV.LAND TITLES AND DEEDS

V. WILLS AND SUCCESSION

9. Successional Rights of Marital and Non-

OBLIGATIONS AND CONTRACTS

III. NATURAL OBLIGATIONS

IV. CREDIT TRANSACTIONS

VII.TORTS AND DAMAGES

PERSONS AND FAMILY RELATIONS

A. WHEN LAW TAKES EFFECT - Publication must be in full or it is no

B. IGNORANCE OF THE LAW E. WAIVER OF RIGHTS

G. LEGAL PERIODS Conflict of Laws v. International Laws

Art. 13. When the laws speak of years, CONFLICT INTERNATIONAL

- twelve (12) calendar months (Revised

2. LEX REI SITAE (ART. 16) 4. DOCTRINE OF RENVOI

When the acts referred to are executed before Injury Damage

Doctrine of Damnum Absque Injuria - There is a common element under Articles

STRICT LIABILITY LIABILITY FOR UNJUST REFUSAL TO

INDEPENDENT CIVIL ACTION (14) The right to be a free from involuntary

ORDINARY CIVIL ACTION EX DELICTO BAR QUESTION (1996)

PREJUDICIAL QUESTION 2. BIRTH AND DEATH OF NATURAL

Presumptive Personality REQUISITES:

A married woman may use: M. RULES GOVERNING

PRESUMPTION OF DEATH Ruling:

MARRIAGE CONTRACT ORDINARY CONTRACT

Cannot be revoked, dissolved or Parties may, by mutual agreement, terminate an ordinary

A. GENERAL PRINCIPLES WHO ARE AUTHORIZED TO SOLEMNIZE

Effect of Absence of Essential Requisites MARRIAGE LICENSE

SUGGESTED ANSWER BAR QUESTION (2009)

B. MIXED MARRIAGES AND BAR QUESTION (2019)

SUGGESTED ANSWER C. VOID MARRIAGES

SUGGESTED ANSWER Article 53. Either of the former spouses may

SUGGESTED ANSWER • On December 18, 2001, Mario filed a

To summarize, psychological incapacity consists Issue:

• Guided by the foregoing measures, this BAR QUESTION (2008)

PRESUMPTION OF VALIDITY • In 2009, the RTC convicted Pulido and

Summary: PERIOD OF DISAPPEARANCE

ABSENCE OR SEPARATION IN FACT BAR QUESTION (2008)

• First, her personal knowledge of a growing AUTOMATIC TERMINATION OF 2ND

BAR QUESTION (2011) F. FOREIGN MARRIAGES

Consent SUGGESTED ANSWER

SUGGESTED ANSWER Support and Custody

BAR QUESTION (2012) Role of Fiscal

EFFECTS OF DECREE OF LEGAL H. PROPERTY RELATIONS

2. VOID DONATIONS BY THE SPOUSE 3. Debts and obligations contracted by either

Disagreement in the administration of 4. CONJUGAL PARTNERSHIP OF

Under this property regime, all properties Alienation of exclusive properties of

RULES IN CASES OF IMPROVEMENT

Levy On Conjugal Property

Administration of the Conjugal Exceptions:

6. PROPERTY REGIME OF UNIONS WITHOUT MARRIAGE

Encumber of Sell Without Consent

BAR QUESTION (2012)

SUGGESTED ANSWER 7. JUDICIAL SEPARATION OF

I. THE FAMILY J. THE FAMILY HOME

1. GENERAL PRINCIPLES 1. GENERAL PRINCIPLES

Value of Family Home that is Exempt K. PATERNITY AND FILIATION

c) Rights of Legitimate Children PRESCRIPTIVE PERIOD IN IMPUGNING

a) Who are Illegitimate Children PRESCRIPTIVE PERIOD IN CLAIMING