DIFFERENT MODES OF ACQUIRING OWNERSHIP mortgage in favor of DBP, with Norkis issuing a Sales

Invoice to facilitate the mortgage.

1. ORIGINAL MODE
2. DERIVATIVE MODE Motorcycle was registered in LTO under Alberto but was
delivered to Julian, allegedly the agent of Alberto. The
ORIGINAL MODE - is independent of any pre-existing or motorcycle met an accident.
preceding title or right of another. It result in the
independent creation of a new right of ownership. Alberto filed an action for specific performance against
Norkis.
a) Occupation
b) Creation or Work (Intellectual Creation) Norkis averred that the motorcycle had been delivered as
c) Prescription evidenced by the issuance of the Sales Invoice and
d) Law (ex: Art. 624, 681, and 1434 of CC.) registration in LTO under Alberto.

Occupation - things appropriable by nature that are without SC decision:

an owner, such as animals that are the object of hunting and
Act of delivery, whether constructive or actual, must be
fishing, hidden treasure, and abandoned movables, are
coupled with the delivery of the thing, without which the act
acquired by occupation.
is insufficient.
Creation or work (intellectual creation)
The critical factor which gives legal effect to the act is the
Prescription - as when ownership of land is acquired by actual intention of the vendor to deliver, and its acceptance
adverse possession for the period of time required under the by the vendee. Without that intention, there is no tradition.
law, provided the
When the motorcycle was registered by Norkis in the name
necessary legal conditions or requisites are present.
of private respondent, Norkis did not intend yet to transfer
Law e.g accession, fruits naturally falling on adjacent land. the title or ownership to Nepales, but only to facilitate the
execution of a chattel mortgage.
DERIVATIVE - is when there was a
previous owner of the property. It is an acquisition which Under the civil code, the thing is considered to be delivered
depends on the existence of the right of a certain other when it is placed in the hands and possession of the vendee.
person.
It is not enough to confer upon the purchaser the ownership
a) Succession or Through inheritance and the right of possession. The thing sold must be placed in
b) Donation his control.
c) Tradition
The thing sold remain at the seller’s risk until ownership
A mode is the legal means by which dominion or ownership thereof is transferred to the buyer Therefore, Norkis should
is created, transferred, or destroyed; title is only the legal bear the loss.
basis by which to affect
Kinds of Tradition:
dominion or ownership. Mode creates a real right; title
creates merely a personal right. a) Real tradition
b) Constructive tradition
DELIVERY OR TRADITION
c) Quasi-tradition
Refers to the transfer of possession accompanied d) Tradition by operation of law
by an intention to transfer ownership or other real
Real Tradition which is the physical or actual delivery,
rights.
takes place when the thing is placed in the control and
Ownership is transferred not by contract alone but possession of the grantee.
by delivery.
Constructive tradition is by delivery of a movable or
It should be noted that sale is not a mode, but is immovable thing by means of acts or signs thereof. The
merely a title. It is tradition or delivery, as a change of possession or
consequence of sale, that actually transfers delivery is not materially visible.
ownership.
 Traditio symbolica
It is a rule that ownership can never  Traditio longa manu
pass by the bare delivery of the thing. No delivery  Traditio brevi manu
can be tradition unless it is accompanied by an  Traditio constitutum possessorium
intention to
Tradition by operation of law such as by the registration
transfer ownership.
of a deed of transfer of titled land which is also the
The critical factor in the different modes of operative act in order to bind
affecting delivery which gives innocent persons in such deeds.
legal effect to the act, is the actual intention of the
Quasi-tradition such as delivery which
vendor to deliver, and its
may be made by the execution of a public instrument with
acceptance by the vendee.
respect to incorporeal property.
Norkis Distributor, Inc. v CA

Alberto bought a motorcycle from Norkis by means of

EXECUTION OF PUBLIC INSTRUMENT is equivalent
Letter of Guaranty from DBP. Alberto executed a chattel
to the delivery of the thing.
The execution of a contract of sale as
a form of constructive delivery is but a legal fiction. It
holds true only then there is no legal impediment that may
prevent the passing
of the property from the hands of the vendor into those of
the vendee.
The execution of a public instrument gives rise only to a
prima facie presumption of delivery.
Such presumption is destroyed when it is shown that such
delivery was not effected because a third person was
actually in possession of the thing.
EQUATORIAL REALTY v MAYFAIR
Mother case:
Mayfair filed for Annulment of Sale between Carmelo &
Equatorial because Carmelo sold a land to Equatorial
without their first being offered to Mayfair who has a right
of first refusal to purchase in connection with a lease
agreement.
The SC rescinded the DOS and Carmelo was ordered to
allow Mayfair to buy the aforesaid lots.
Mayfair filed a Motion for Execution, which the trial court
granted but Carmelo could no longer be found. Mayfair
deposited with the clerk of court its payment to Carmelo. It
issued a Deed of Reconveyance in favor of Carmelo and a
Deed of Sale in favor of Mayfair. New title was issued to
Mayfair.
This case:
Equatorial filed an action for the collection of money
against Mayfair for rentals after its lease contracts had
expired representing itself as the owner by reason of the
Contract of Sale it had with Carmelo.
Issue: Is Mayfair liable to pay rentals to Equatorial ----- NO
SC decision:
No right of ownership was transferred from Carmelo to
Equatorial in view of a patent failure to deliver the property
to Equatorial.
Ownership is transferred, not merely by contract, but also
by tradition or delivery. And there is said to be delivery if
and when the thing sold "is placed in the control and
possession of the vendee."
Equatorial never took actual control and possession of the
property sold, in view of Mayfair’s timely objection to the
sale and the continued actual possession of the property.
Objection took the form of a court action impugning the sale
which was rescinded by a judgment rendered by this Court
in the mother case.
Mayfair's opposition to the transfer of the property by way
of sale to Equatorial was a legally sufficient impediment
that effectively prevented the passing of the property into
the latter's hands.
The sale to Equatorial may have been valid from inception,
but it was judicially rescinded before it could be
consummated. Equatorial never acquired ownership, not
because the sale was void but because the sale was not
consummated by a legally effective delivery of the property
sold.
Thus, no right to collect rent.
PRESCRIPTION
Either Ordinary or Extraordinary.
Ordinary – possession in good faith + just title for 10 years.
Without good faith and just title, acquisitive prescription can
only be extraordinary in character.
POSSESSION IS IN GOOD FAITH when there is a
reasonable belief that the person from whom the thing is
received has been the owner
thereof and could thereby transmit his ownership.
ABALOS VS HEIRS OF VICENTE TORIO
Topic: Prescription
Heirs of Torio filed a case against Jaime who refused to
vacate their land. Torio, during his lifetime, allowed Jaime
to stay and build their houses in the land.
Jaime claims to have acquired ownership through ordinary
acquisitive prescription. That owners and possessors of the
disputed lot are his deceased predecessors; that they have
been in possession of the lot as owners since time
immemorial; have faithfully and religiously paid RPT.
SC decision:
Jaime acknowledged ownership thereof by the immediate
predecessor-in-interest of Heirs of Torio ---- as shown by
the Tax Declaration of Jaime for the year 1984 containing
statement admitting that Jaime's house was built on the land
of Torio. Jaime never disputed such an acknowledgment.
Thus, Jaime’s possession could not be deemed as possession
in good faith as to enable them to acquire the subject land
by ordinary prescription.
Also, Jaime’s possession also did not ripen into ownership,
because he failed to meet the required statutory period of
extraordinary prescription. Earliest tax dec. of Jaime was in
1974 and heirs filed complaint in 1996.
Registered land can never be acquired by adverse
possession applies only to acquisitive prescription. The
rule does not apply to extinctive prescription --- laches.
While it is true that a Torrens title is indefeasible and
imprescriptible, the registered owner may lose his right to
recover possession of his registered property by reason of
laches.
Four Elements of Laches
1. conduct on the part of the defendant, or of one
under whom he claims, giving rise to the situation
of which complaint is made.
2. delay in asserting the complainant’s rights, the
complainant having had knowledge or notice, of
the defendant’s conduct and having been afforded
an opportunity to institute a suit
3. lack of knowledge or notice on the part of the
defendant that the complainant would assert the
right on which he bases his suit
4. injury or prejudice to the defendant in the event
relief is accorded to the complainant, or the suit is
not held to be barred.
 PANGASINAN V. ALMAZORA
Topic: Laches
Aquilina Martinez borrowed money from Conrado
Almazora. Aquilina gave the owner’s duplicate copy of the
title to Conrado, and Conrado’s family took possession of
the property.
Conrado was able to transfer title on June 17, 1965 in his
name from Aurora Vivar, Aquilana’s only heir. Aurora
learned it in 1994.
Aurora contended that the owner’s duplicate copy was only
given to Conrado for safekeeping. In 1996 she filed a
complaint against the heirs of Conrado.
SC decision:
The action must fail, not because Conrado adversely
occupied the property, but because Aurora failed to institute
their suit within the prescriptive period
It was extinctive prescription, and not acquisitive
prescription, which barred the action of petitioners.
It took five decades (1945 to 1996) before Aurora decided to
enforce their right on the property.
Conrado’s family would be prejudiced in the event that the
suit would be allowed to prosper.
The prescriptive period to recover property obtained by
fraud or mistake, giving rise to an implied trust under
Article 1456 of the Civil Code, is 10 years.
The prescriptive period to enforce the constructive trust
shall be counted from the alleged fraudulent registration or
date of issuance of the certificate of title over the property.
Allegedly, Conrado employed fraud and bad faith and
transferred the title of the land to his name on June 17,
1965; and because of the purported fraud committed by
Conrado against Aurora, an implied constructive trust was
created by operation of law, with Conrado as trustee and
Aurora as cestui que trust.
Therefore, Aurora had until June 17, 1975 to enforce the
implied trust from June 17, 1965 and assert their claim over
the land. With the lapse of the prescriptive period to file an
action, Aurora could no longer seek relief from the courts.
DONATION – is an act of liberality whereby a person
disposes gratuitously of a thing or right in favor of another,
who accepts it.
As a mode of acquiring ownership, donation is perfected
from the moment the donor knows of the acceptance by
the donee. Once a donation is accepted, the donee becomes
the absolute owner of the property donated.
DONATIONS MORTIS CAUSA - donation is made in
contemplation of the donor’s death. The full ownership of
the property will pass to the donee only because of the
donor’s death. It is at this time that the donation takes
effect. It partakes of the nature of a testamentary provisions.
As such, it must be executed in accordance with the
requisites on the solemnities of wills and testaments;
otherwise, the donation will be considered as void.
Before the death of the transferor, the transfer is revocable
at the discretion of the donor. The transfer will be void if the
transferor should survive the transferee.
DONATION INTER VIVOS takes effect during the
donor’s lifetime or independently of the donor’s death. Full
ownership of the donated properties passes to the donee
during the donor’s lifetime, not by reason of his death.
If the donation is inter vivos, it must be executed and
accepted with the formalities described in Art. 748 and 749
of the Civil Code, except for onerous donation, in which
case the rules on contracts will apply.
Types of Donation Inter Vivos
1. pure or simple
2. remuneratory / compensatory
3. conditional or modal
4. onerous
Onerous donation is one that imposes upon the donee a
reciprocal obligation. This is the kind of obligation made
for valuable consideration. Governed not by the law of
donations but by the law on contracts.
Art. 748. The donation of a movable may be made
orally or in writing.
An oral donation requires the simultaneous
delivery of the thing or of the document
representing the right donated.
If the value of the personal property donated
exceeds five thousand pesos, the donation and the
acceptance shall be made in writing, otherwise, the
donation shall be void.
Art. 749. In order that the donation of an
immovable may be valid, it must be made in a
public document, specifying therein the property
donated and the value of the charges which the
donee must satisfy.
The acceptance may be made in the same deed of
donation or in a separate public document, but it
shall not take effect unless it is done during the
lifetime of the donor.
If the acceptance is made in a separate instrument,
the donor shall be notified thereof in an authentic
form, and this step shall be noted in both
instruments.
In DONATION MORTIS CAUSA, before the death of the
transferor, the transfer is revocable at the discretion of the
donor. The transfer will be void if the transferor should
survive the transferee.
In DONATIONS INTER VIVOS, once accepted, becomes
irrevocable but the donation may be made revocable by the
fulfillment of a resolutory condition or for the reasons
provided for in Art. 760, 764 and 765.
Art. 764. The donation shall be revoked at the
instance of the donor, when the donee fails to
comply with any of the conditions which the
former imposed upon the latter.
In this case, the property donated shall be returned
to the donor, the alienations made by the donee
and the mortgages imposed thereon by him being
void, with the limitations established, with regard
 to third persons, by the Mortgage Law and the
Land Registration Laws.
This action shall prescribe after four years from
the noncompliance with the condition, may be
transmitted to the heirs of the donor, and may be
exercised against the donee's heirs.
BONSATO VS CA
Topic: Inter Vivos
Joseha alleged that Domingo was induced by his brother
Juan and nephew Felipe to sign a Deed of Donation in their
favor and since it was donation mortis causa, they were void
for failure to comply with the formalities of a will.
Issue: Whether donation is Mortis Causa or Inter Vivos
SC decision:
Donation is Inter Vivos.
The donor reserved for himself, during his lifetime, the
owner's share of the fruits or produce, a reservation that
would be unnecessary if the ownership of the donated
property remained with the donor.
3 Characteristics of Mortis Causa:
 transferor retain ownership and control of the
property while alive.
 before his death, the transfer should be
revocable.
 the transfer should be void if the transferor
should survive the transferee.
The deeds expressly declare them to be "irrevocable."
The phrase "that after the death of the donor the aforesaid
donation shall become effective," means that after the
donor's death, the donation will take effect so as to make the
donees the absolute owners of the donated property, free
from all liens and encumbrance.
This provision had to be included since the donor reserved
for himself, a share of the fruits of the land donated. It thus
means that the reservation was only to make it clear that the
encumbrance he had earlier imposed on the property will
disappear upon his death so that full title would become
vested in the donees.
GANUELAS VS CAWED
Topic: Mortis Causa
Dona Tina executed a DOD in favor of Lina "for and in
consideration of the love and affection which the donor has
for the donee and of the faithful services the latter has
rendered in the past to the former."
The donation was "to become effective upon the death of
the donor, but in the event that the donee should die before
the donor, the present donation shall be deemed rescinded
and of no further force and effect."
The donation was in public instrument but signed only by
the done & donor (no witnesses signature).
Dona Tina executed a “Revocation of Donation" and latter
died.
Nieces of Dona Tina filed against Lina alleging that the
donation was mortis causa which failed comply with
formalities, hence void.
Lina contended that it was inter vivos as the main
consideration for its execution was Dona Tina’s affection for
her and its revocation was not valid as it was not based on
the grounds provided in Articles 760,764,and 765 of the
Civil Code.
SC decision:
Mortis Causa because it was to take effect only upon Doña
Tina’s death.
Nothing in the deed of donation which indicates that any
right, title or interest in the donated properties was to be
transferred to Lina prior to the death of Doña Tina.
The donation was one mortis causa but it is defective since
the acknowledgment before the notary public was signed
only by the donor and the donee.
Donation is null and void because the required formalities
are defective and it has been validly revoked.
LAGAZO V. CA
Topic: Simple donation
Before leaving for Canada, Catalina executed SPA
authorizing his son-in-law Eduardo with regard her land.
Later on she revoked the SPA and executed another SPA in
favor of Lagazo.
While in Canada she executed a DOD in favor of Lagazo.
He paid the installments in arrears and the remaining
balance on the lot and declared the said property in the
name of Catalina Jacob.
Lagazo filed a case against Cabanlit who refused to the
vacate the land. Cabanlit alleged that the land was sold to
him by Eduardo.
Lagazo claims that the formalities for donation is N/A in his
case since it was an onerous one- he paid for the
amortizations due on the land before and after the execution
of the deed of donation.
He contends that the burdens, charges or conditions imposed
upon a donation need not be stated on the deed of donation
itself.
Being an onerous donation, his acceptance thereof may be
express or implied, as provided under Art. 1320, and need
not comply with the formalities required by Art. 749.
SC decision:
Donation was simple donation.
A simple or pure donation is one whose cause is pure
liberality, while an onerous donation is one which is
subject to burdens, charges or future services equal to or
more in value than the thing donated.
Under Article 733 of the Civil Code, donations with an
onerous cause shall be governed by the rules on contracts;
hence, the formalities required for a valid simple donation
are not N/A.
Art. 733. Donations with an onerous cause shall be
governed by the rules on contracts and
remuneratory donations by the provisions of the
present Title as regards that portion which exceeds
the value of the burden imposed.
Even conceding that Lagazo’s full payment of the purchase
price of the lot might have been a burden to him, such
payment was not however imposed by the donor as a
condition for the donation.
It is clear that the donor did not have any intention to burden
or charge petitioner as the done. The payments made by
Lagazo were merely his voluntary acts.
Being a simple donation, the donation is perfected only
upon the moment the donor knows of the acceptance by
the donee.
Donee's failure to accept a donation whether in the same
deed of donation or in a separate instrument renders the
donation null and void.
DANGUILAN V IAC
Topic: Onerous donation
Apolonia Melad illegitimate daughter of Domingo Melad
filed a case against Daguilan for land unlawfully withheld
by the latter.
Apolonia claimed she bought the land.
Domingo Melad signed a private instrument in which he
gave Danguilan the farm and in which he also gave him the
residential lot, on the understanding that Danguilan would
take care of Domingo and would bury him upon his death.
SC decision:
Domingo Melad did intend to donate the properties to
Danguilan
While they were true donations, conveyances were onerous
donations as the properties were given to Danguilan in
exchange for his obligation to take care of the donee for the
rest of his life. Hence, not covered by the rule in Art. 749
requiring donations of real properties to be effected through
a public instrument.
Donation in question was made for a valuable consideration,
since the donors made it conditional upon the donee’s
bearing the expenses that might be occasioned by the death
and burial of the donor.
No evidence has been adduced by Apolonia to support her
contention that the values exchanged were disproportionate
or unequal.
We may assume that there was a fair exchange between the
donor and the donee that made the transaction an onerous
donation. The donor died when he was almost one hundred
years old.
VALID REVOCATION OF DONATIONS:
 Arts. 760- birth or appearance of donor’s child),
 Art. 764 - failure of donee to comply with
conditions
 765 – ingratitude
VELASQUEZ vs. CA
Topic: Valid revocation of donation
Spouses Leoncia & Cornelio Aquino are childless. Leoncia
was survived by her sisters Anatalia & Tranquilina.
Anatalia praying for the nullity of any documents covering
the properties donated to Cesario (son of Tranquilina) since
they do not bear the genuine signatures to order the partition
of the properties between the heirs of Leoncia
Cesario alleged that during their lifetime, the spouses
Aquino had already disposed of their properties by virtue of
Donation Propter Nuptias to his parents.
Issue: Will the action for partition filed by the heirs of
Anatalia prosper --- NO.
SC decision:
Donation is perfected from the moment the donor knows
of the acceptance by the donee. And once a donation is
accepted, the donee becomes the absolute owner of the
property donated.
The donation made by the Aquino spouses accepted by
Cesario Velasquez, and the acceptance was incorporated in
the body of the same deed of donation and made part of it,
and was signed by the donor and the acceptor.
The donation existed perfectly and irrevocably. A
DONATION INTER VIVOS may be revoked only for
the reasons provided in Articles 760, 764 and 765 of the
Civil Code.
The alleged reason for the repudiation of the deed, i.e., that
Anatalia (Leoncia's sister) had several children to support, is
not one of the grounds for revocation of donation either
inter vivos or propter nuptias, although the donation might
be inofficious.
Properties sought to be partitioned have already been
delivered to the heirs of Casario and therefore no longer part
of the hereditary estate which could be partitioned.
FELICIANO CATALAN vs. JESUS BASA
Martina filed for nullification of DOD against Ignao & the
Roman Catholic Bishop of Imus.
His predecessor executed a DOD in favor of Roman
Catholic Archbishop over a land and it contained a
provision that the donee shall not sell the property within a
period of one hundred years from the execution of the DOD,
otherwise void. However, it was sold to Ignao within the
prohibited period.
Ignao and Catholic church filed a MD the complaint on the
ground that the cause of action has prescribed.
The CA rule that the action for rescission of the donation
has not yet prescribed.
SC decision:
Judicial action for rescission of a contract is not
necessary where the contract provides that it may be
revoked and cancelled for violation of any of its terms and
conditions.
More importantly, the undue restriction on the right of
the owner of the property is contrary to public policy.
Although the donor may impose certain conditions in the
deed of donation, the same must not be contrary to law,
morals, good customs, public order and public policy.
The condition imposed in the deed of donation in this case
constitutes a patently unreasonable and undue restriction
on the right of the donee to dispose of the property
donated, which right is an indispensable attribute of
ownership.
Hence, illegal or impossible condition, such condition shall
be considered as not imposed.
Art. 727. Illegal or impossible conditions in
simple and remuneratory donations shall be
considered as not imposed.
FORMALITIES IN DONATION
A donation is a solemn contract which requires form for
purposes of validity. If the formalities required in Art. 748
and 749 are not followed, the donation shall be void.
The formalities set in Art. 748 and 749 are applicable only
to donations inter vivos and to simple and remuneratory
donation.
Donations propter nuptias are also governed by Art. 748
and 749.
Form of Donation of Personal Property:
Donation of personal property may be made either orally
or in writing.
If the value of the property does not exceed 5K, the
donation may be made orally but there must be
simultaneous delivery of the thing or of the document
representing the right donated. If there is no simultaneous
delivery, the donation is void.
If the value of the personal property exceeds 5K, both the
donation and the acceptance must be in writing, otherwise
the donation shall be void.
The donation and acceptance must be in a document, which
may be private or public. It need not be in a single
document. Hence, the acceptance may be made in a
separate instrument and such fact nee not be noted in both
instruments of donation and acceptance.
Art. 748. The donation of a movable may be made
orally or in writing.
An oral donation requires the simultaneous
delivery of the thing or of the document
representing the right donated.
If the value of the personal property donated
exceeds five thousand pesos, the donation and the
acceptance shall be made in writing, otherwise, the
donation shall be void.
Form of Donation of Real Property
Art. 749. In order that the donation of an
immovable may be valid, it must be made in a
public document, specifying therein the property
donated and the value of the charges which the
donee must satisfy.
The acceptance may be made in the same deed of
donation or in a separate public document, but it
shall not take effect unless it is done during the
lifetime of the donor.
If the acceptance is made in a separate instrument,
the donor shall be notified thereof in an authentic
form, and this step shall be noted in both
instruments.
If the notification and notation are not complied with, the
donation is void.
The charges referred to are the burdens, which must be
inferior in value to the property donated. These charges are
required to be specified in the deed of donation for the
purpose of determining the true amount of the donation.
If the charges are equal to or more than the value of the
property donated, the donation is, in reality, a contract, and
as such, will be governed by the law on contracts.
Registration not Necessary for Validity of Donation
It is enough, between the parties to a donation of an
immovable property, that the donation be made in a public
instrument, but in order to bind third persons, the donation
must be registered in the Registry of Property.
As between the parties to the donation and their assigns, the
registration of the deed of donation with the Register of
Deeds is not needed for validity and efficacy.
SHOPPER’S V ROQUE
On Dec. 1978, Dr. Roque executed a DOD Inter Vivos in
favor of his son Efren.
The title to the property remained in the name of Dr. Roque,
and it was only transferred to Efren 16 years later, or on 11
May 1994.
On Dec. 1993, Dr. Roque entered into 25-year Contract of
Lease and the MOA, both notarized, were to be annotated
on the title of the property. However, annotation was not
made due to Dr. Roque’s death.
On February 1995, Efren filed a case for annulment of the
contract of lease and the MOA between Shopper’s and his
father.
CA decision:
Shopper’s was not a lessee in good faith having had prior
knowledge of the donation in favor of Efren, and that such
actual knowledge had the effect of registration insofar as
Shopper’s was concerned.
SC decision:
Non-registration of a deed of donation does not affect its
validity, which has resulted in an effective transfer of title
over the property from the donor to the donee.
In donations of immovable property, for validity, the law
requires that it be contained in a public document.
But titles of ownership, or other rights over immovable
property, which are not duly inscribed or annotated in the
Registry of Property shall not prejudice third persons.
In order to bind third persons, the donation must be
registered in the registry of Property.
But, where such party has knowledge of a prior existing
interest which is unregistered at the time he acquired a right
thereto, his knowledge of that prior unregistered interest
would have the effect of registration as regards to him.
Shopper’s was aware that Dr. Roque was not anymore the
owner of the property. And since Dr. Roque was not an
agent of Efren, the contract of lease and memorandum of
agreement entered into between Dr. Roque and Shopper’s is
not to be binding on Efren.
REVOCATION OF DONATION
Grounds:
a) Subsequent appearance of children;
b) Non-fulfillment of the charges imposed in the
donation;
c) The ingratitude of the donee;
d) The fact that the donation is inofficious;
If, despite the happening of these events (grounds) , the
proper action for revocation is not instituted, or is
instituted after the lapse of the period of prescription, the
donation will be forever considered valid.
Prescriptive period of an action for revocation or reduction
under Art. 760 is four years, reckoned from the birth of the
first child, or from his legitimation, or from judicial
declaration of filiation, or from the time of information
regarding existence of a child believed to have been dead.
The action can be transmitted, upon the death of the donor,
to his legitimate or illegitimate children and descendants, if
the donor dies within the four year prescriptive period.
Art. 764. The donation shall be revoked at the
instance of the donor, when the donee fails to
comply with any of the conditions which the
former imposed upon the latter.
In this case, the property donated shall be returned
to the donor, the alienations made by the donee
and the mortgages imposed thereon by him being
void, with the limitations established, with regard
to third persons, by the Mortgage Law and the
Land Registration Laws.
This action shall prescribe after four years from
the noncompliance with the condition, may be
transmitted to the heirs of the donor, and may be
exercised against the donee's heirs.
Art. 1144. The following actions must be brought
within ten years from the time the right of action
accrues:
a) Upon a written contract;
b) Upon an obligation created by law;
c) Upon a judgment.
Art. 733. Donations with an onerous cause shall be
governed by the rules on contracts and remuneratory
donations by the provisions of the present Title as
regards that portion which exceeds the value of the
burden imposed.
ART. 764 Failure to Comply with Conditions In relation To
Art. 733.
If the conditions refer to obligations or charges imposed
by the donor on the donee, then it takes the character of an
onerous donation, which under Art. 733, should be
governed by the rules on contracts, which provides that an
action to enforce a written contract prescribes in 10 years.
But Art. 764 which also refers to failure to comply with any
of the conditions imposed by the donor. In such a case, the
action will prescribe in four years.
Art 764 – 4 years
Art 733 – 10 years
When there is a failure to comply with the conditions of a
donation, which between Art. 764 and 733 should apply?
It appears from jurisprudence that Art, 764 applies where
there is a provision in the deed of donation for the
automatic reversion of the property.
However, Art 764 does not apply in case of
violation of the condition therein and there is no
challenge to the revocation.
DE LUNA VS ABRIGO
De Luna donated a land to Luzonian Colleges with certain
terms & conditions provided for the automatic reversion to
the donor of the donated property in case of violation or
non-compliance.
Donee failed to comply. On April 9, 1971, de Luna
"revived" the said donation subject to terms and conditions
and provided for the automatic reversion to the donor of the
donated area in case of violation of the conditions, without
the need of executing any other document for that purpose
and without obligation whatever on the part of the donor.
On September 23, 1980, the heirs of the late Prudencio de
Luna filed for the cancellation of the donation since the
school was not able to comply with the conditions of the
donation.
School invoked the affirmative defense of prescription of
action and prayed for the dismissal of the complaint
SC decision:
Not yet prescribed.
Donation in this case was an onerous donation since it
created a burden on the donee. Being onerous, it will be
governed by the law on contracts.
In prescription of actions for the revocation of onerous
donation, the general rules on prescription applies.
Even if Article 764 provides that actions for the revocation
of a donation must be brought within four years from the
non-compliance of the conditions of the donation,
however, said article does not apply to onerous donations
in view of the specific provision of Article 733 providing
that onerous donations are governed by the rules on
contracts.
The rules on contracts and the general rules on
prescription and not the rules on donations are applicable
in the case at bar.
The complaint which was filed on September 23, 1980 was
then well within the ten year prescriptive period to enforce
a written contract counted from April 9, 1971.