PLEDGE – RA11057
republic.
Contract of Pledge – it is constituted at the
moment when the pledgor delivers to a pledgee
a movable, instrument evidenced in incorporeal
rights for the purpose of fulfilment of principal
obligation, after the fulfillment of the obligation
the pledged thing will be returned with its fruits
and etc.
Real Contract – perfected upon the delivery
Unilateral – obligation on the part of the pledgee
to return the pledged thing upon the fulfilment
of the obligation
Accessory contract- cannot exist without a
principal obligation, all of the obligation pure or
conditional obligation
Contract of pledge is indivisible, while the
obligation itself may be divisible. When a part of
divisible obligation secured by pledge, after the
fulfillment of it, may be returned. You cannot
have double pledge; thing is subjected to pledge
before. To be binding upon the third persons, the
date and description of pledged must appear in
the public instrument.
A pledge is intended to secure an existing debt,
the pledgor must also be the owner of the thing
pledged. The pledgor must also have the free
disposal right/ or legally authorized over the
thing pledged. The pledged thing, may be
alienated if the principal obligation becomes
due, through a public auction following the
formalities of law. Lastly, the pledged thing is in
the possession of the creditor/pledgee.
PACTUM COMMISSORIUM – a prohibition
imposed by law by which parties are prohibited
forming a stipulation that the thing pledged
automatically becomes the object of the pledgee
incase the non fulfilment of obligation. Any
stipulation regarding this is void. As a remedy,
the creditor may dispose the thing through a
public auction and intervention of the notary
In auction, the sale extinguishes the obligation
and the pledge. Non sale in the first auction
results into a second auction sale with the same
formalities as the first one. If not sold, the law
allows the creditor to appropriate the pledged
thing to satisfy his claims. Proceeds is less than
the purchase price, the creditor is not entitled
for deficiency as he accepted the price, if it is sold
to a higher value, the creditor keeps it and
debtor has no right for the excess. The pledgor
may bid, and if offered the same bid(highest)
with another, he will have the better right. The
creditor cannot bid (not valid) if he is the sole
bidder at the auction. The third person can
satisfy the principal obligation if he has the right
in or right to the thing, interested in the thing.
Rights of the pledgor.
A pledgor may demand the return of the thing if
he has reasonable ground for danger,
destruction without the fault of the pledgee. The
pledgee must notice the pledgor of such danger.
The pledgor has the right to substitute the thing
pledged.
In public auction, he has the better right in
highest bid.
As he still is the owner, he is able to alienate the
thing with the consent of the pledgee.
A deposit may be asked by pledgor incase the
pledgee violated the authority and misuse the
thing pledged, there is danger of loss or
impairment, negligence of the pledgee.
Obligation of the Pledgor
He must notify the defect of the thing pledged to
the pledgee, if not he will be liable for the
damages resulting from it to the pledgee
He must pay the principal obligation, interest,
expenses for preservation.
Rights of a pledgee
The pledgee has the right to possess the thing,
he may also reject the transfer of ownership of
the thing. The fruits/interest may be applied to
the interest earned of the obligation and to the
principal obligation. Pledgee can retain the
possession of the thing until the fulfilment of the
obligation. In case the pledged thing is
instrument of credit, he has the right to collect
the same. He may demand replacement or
immediate payment if he was deceived, in
substance or quality of the object.
Reimbursement for the expenses of
preservation. Non payment can sell the thing at
a public auction, if he has also reasonable
grounds of destruction, impairment without
fault on his part he may sell the thing at the
public auction.
If there are many things pledge, the pledgee has
the right of choice, shall be sold. He can only sell
what covers the debt. He is allowed to bid if he
is the sole bidder. Excess is given to the creditor,
and debtor cannot claim the excess. He may only
appropriate the thing after the second failure of
the auction.
Obligations of the pledgee
He has the right to take care of the thing like a
diligence of a good father. He cannot use/misuse
the thing without authorization or it is needed
for preservation of the thing. Agents of the
creditor will hold the creditor for damages they
caused. The pledgee must notify the pledgor of
danger or impairment, as well as the result of the
auction. Pledgee must return the thing pledged
if the obligation has already been paid.
MODES OF EXTINGUISHMENT
The thing is returned to the pledgor, the pledge
is extinguished.
Renunciation or abandonment of the pledge of
the pledgee, the pledge is extinguished.
The thing pledge is sold at the public auction, if
the second auction is failed the appropriation of
the creditor.
Legal Pledge – created by the operation of law.
In auction, the pledgor is entitled to the excess
proceeds.
REAL ESTATE MORTGAGE
Contract of Real Estate Mortgage – the debtor.
Mortgager guarantees a security of principal
obligation by subjecting a immovable property,
real rights over immovable property as security
incase of default at maturity date.
It is a real contract, perfected by mere delivery,
subsidiary and accessory. The price of mortgage
is the price of the obligation. It is not a transfer
of ownership, merely a lien placed upon the
property, it creates a real right. Real right is those
that are enforceable against the whole world. It
attaches to the property. Mortgagee may claim
payment from the third person to whom it was
transfer. The mortgage extent to the property
itself, accession, improvement, income, and etc.
It is constituted to security the fulfillment of a
principal obligation, past, present and future
debt under a drag net or blanket cloth. The
Mortgagor must be the absolute owner of the
property. (present properties, as a general rule
future properties are not subjected to mortgage,
unless there is a stipulation) He must have the
free disposal of the property. The object must be
immovable or real rights over the property.
There must be a requirement for registration. If
it is not registered, it will not be binding to third
persons but binding to the parties.
Kinds of Mortgage
Voluntary Mortgage – entered by agreement of
the parties
Legal Mortgage – Created by operation of law
Equitable Mortgage
- One that lacks of formalities of mortgage
but shows the intention of parties to
treat the property as security of the
obligation.
PACTUM COMMISSORIUM – prohibition by law,
any stipulation that allows automatic
appropriation of the creditor over the thing upon
failure of payment.
Foreclosure – remedy of the creditor, wherein
the creditor uses public auction for the payment
of his claim.
Judicial Foreclosure – the court in jurisdiction is
where the property is situated, initiated by
complaint filing, the court will determine the
amount due, orders payment in a judgement.
After this the debtor is given 90-120 days which
he will pay the amount, incase of default, the
buyer at the auction (provided there is sale) is
entitle to the property.
If the proceeds has an excess, the excess will go
to the less preferred mortgages then to the
mortgagor
IF there is deficiency, the court will hold a
deficiency judgement and hold the debtor liable
for the balance
Extrajudicial Foreclosure- outside of the court,
must be in the stipulation with special power
within the contract of mortgage
Filing an application, compliance with the
requirements of posting of notice of sale (20
days , three public places), if it is over 400 pesos,
there must be publication once a week, 3 weeks
in the city/municipality, Public auction,
certificate of sale
Equity Redemption
Reacquisition of the property by
mortgagor/third person.
Judicial Foreclosure – Equity of Redemption
- The mortgager still has the chance to get
he property back 90-120 days at the
entry of judgement, or prior to the
confirmation of sale
- If the mortgagee is a bank, the equity of
redemption is longer. 1 year from the
confirmation of sale
Extrajudicial sale – Equity of Redemption
- He has a period of one year on the
issuance of sale, must pay the purchase
price and pay 1% per month, taxes and
interest.
- In case of juridical person, mortgagee is
a bank, the period is 3 months.
ANTICHRESIS
Contract of ANTICHRESIS
-the creditor acquires the right to receive the
fruits of real property of the debtor, applying
those fruits to the interest of obligation or the
principal obligation. Mortgagee in possession,
the subject is the real property.
Characteristics
It is an accessory contract as it exists as a security
of fulfillment of principal obligation. IT is formal
and follows the formalities of the law. It must be
in writing, principal and interest for it to be valid.
It is a consensual contract, perfected by mere
consent. The creditor must be in possession of
the property. The antichresis itself is indivisible
and secures all type of obligation.
The value of the fruits must be appraised at
actual value at the time they are applied to the
principal.
Rights
The creditor can retain the property until full
payment of the price
The right to petition the court to sell the
property in case of default in payments
Extrajudicial foreclosure will govern, there must
be a stipulation and written in the contract.
Obligations
He is obliged to pay taxes, necessary expenses
for preservation. He is allowed to deduct those
expenses from the fruits he will received, he is
not liable if the parties expressed stipulated.
The creditor may compel the debtor to repossess
the property, so that the creditor is relieved from
taxes and expenses, unless the parties has
stipulated that the right is denied.
He must apply fruits to the interest owing then
to the principal obligation.
He must render an account for the fruits.
PACTUM COMMISSORIUM should not appear in
contract of anti-chresis.
The creditor and heirs, cannot obtain the
property through prescription (passage of time).
Chattel Mortgage
Contract of Chattel Mortgage -a contract
wherein a personal property is recorded in the
chattel mortgage register as security of
obligation, an accessory contract, secures the
fulfillment of obligation. If the parties failed to
register the chattel it is still binding upon the
parties, registration notices the third parties and
will not be binding upon them. It is a unilateral
contract.
Registration
The personal property must be registered in
chattel mortgage registry where the mortgagor
resides, if the thing is outside of the province
reside, it must be registered both the province of
mortgagor and the personal property is situated.
Affidavit of Good Faith – the chattel mortgage is
entered for the purpose of securing particular
obligation. It puts preferred status on the
mortgage.
Rule
Chattel mortgage only covers existing
obligations. Future advances can be subjected if
the parties stipulated, and will take an effect at
the time of those advances.
If the debtor fails to pay, the creditor is not the
automatic owner. PACTUM COMMISSORIUM
does not apply to chattel mortgage.
Remedy
1. Foreclosure of the chattel mortgage,
must be in the public auction however
the parties may stipulate private
auction. Within 30 days of nonpayment
of obligation, there must be a notice to
the debtor 10 days before the auction.
Equity of Redemption – payment of principal
obligation before the sale of foreclosed
property, they will be subrogated to the rights of
creditor and foreclose the property subject to
the law.
Application of Proceeds
Cost/ Expenses of Keeping/ Sale
Leftover – Claims of the subsequent mortgagees
Left – Mortgagor (Entitled to the excess)
Deficiency – creditor can go to the debtor to
collect the deficiency unless it falls to the RECTO
LAW (installments)
Chattel Mortgage, no delivery of the thing while
in pledged, the thing must be delivered. Former
requires registration while the latter doesn’t
need to. Rules of sale also differ, the excess in
chattel mortgage goes to the debtor while in
pledge it does not, exception of stipulation or
legal pledge. The creditor may sue for deficiency
in chattel mortgage, except 1484 while in pledge
creditor is not entitled to the deficiency.
RA 11507 – PART 1
It seeks to establish a unified modern framework
for securing obligations using personal property,
providing rules on creation and determination of
priority and enforcement of security interest. It
increases access to lease cost credit.
It provides of single type of security transaction,
security interest.
It covers all transaction that secures obligations
with personal property, tangible, incorporeal
rights, intellectual property, accounts and
livestock. Aircrafts and ships are not allowed.
Security Interest – collateral property right that
secures performance of obligation regardless of
nature
Grantor – buyer, transferor, lessee of goods
It extends to the traceable proceeds of the
personal property, it will continue in the
collateral even if it is sold, leased, or disposed,
unless there is a stipulation or the transferee is
buyer in good faith. If the security interest is
registered, he will not be in good faith.
In accounts receivable, will still be valid even if
there is a contractual limitation on the right of
the grantor to create security interest.
CREATION OF SECURITY INTEREST
It is created through a security agreement in
writing signed by parties, may be in one or more
writings provided that there is an established
intention of security interest. It must have the
description of the collateral, sufficiently enough
to identify the collateral.
It can also cover future property but subject
qualification that the interest will be created
only upon the grantor obtain rights over the
property.
Tangible assets/intangible assets may extend to
its products or replacement, the interest will
only be limited to its value prior to
transformation or replacement. Comingling
goods interest will extend to the mass but
limited to the proportion of the entire mass.
PERFECTION OF SECURITY INTEREST
When perfected, it is already effective to third
parties unless it is not registered but still valid to
the parties.
It is perfected through creation of security
agreement, registration of notice in registration
of property or possession of property of the
creditor (tangible assets)
Electronic Central Registry – notice of and liens
in persona property is registered and search for.
Notice can cover multiple agreements and
effective upon the time it is in the registry, and
last until the indicated time in the notice excess
there is a continuation notice within 6 months
indicated. It must include the ID of the grantor, if
not it is a seriously misleading notice, ineffective.
The notices may be amended. This is applied by
the grantor.
Security Interest is extinguished upon the
payment of the all obligations., not outstanding
commitment is extended. The grantor applies for
termination, another case is that there is no
security agreement exists at all.
Perfection through possession, created through
the security agreement and possession of the
property.
Control
1. Creation of security interest in favor of
the depositary or intermediary
2. Through conclusion of control
agreement.
3. Notation of security interest in the books
Deposit institute cannot be compelled to
confirm existence of control agreement unless it
is requested by the grantor.
ADDTL RULEs
If the collateral produces money, the security
interest will extend to it.
If proceeds are not money, there must be a new
registration, control, possession. If they are not
perfected within 15 days, they will not be
effective against third persons.
If it is over a fixture, it continues to exist provided
that the property is still traceable. Any
subsequent change in the means of perfection,
does not affect the prior perfection.
PART 2------------------------------------------------------
Priority of Security Interest – the right of a
person in encumbered asset preference of
competing claimant, preference in payment with
regard on movable property.
General Rule - liens on the same collateral is
determine on the time of registration in the
notice, or perfection in other means.
Specific Rules
Deposit Accounts – set off or compensate
against the grantors’ right payment of funds
credited to the deposit account
In case of a security interest in a deposit account,
the secured creditor is bank or intermediaries
Security interest in deposit account/investment
account that was perfected by control
agreement.
With many control agreement, we determine by
the time of control
Electronic Security
Not held by intermediary – First preference is
perfected by notation in the books, perfected by
control agreement, Registration of notice – if
many, determine it by time of control agreement
Held by intermediary – Perfected by control
agreement over others
Purchase Money Security Interest
Security interest in goods by the seller to secure
the payment of the buyer.
In Equipment, Proceeds or Consumer Goods –
priority over other conflicting security interest if
the notice is registered withing 3 business days
from the grantor receives the goods
If a third person acquire the rights of the goods –
perfected upon the 3-day rule(timely), the
secured creditor has priority over the third
person which may arise from the delivery of
goods and registration of notice.
Inventory, IP, Livestock – perfected when the
grantor receives the asset/rights, and secured
creditor must give written notice of security
interest to the conflicting holder before grantor
acquires the asset/rights.
If the secured creditor failed to give notice, the
priority transfers to security interest which
secures obligation of necessities for the same
livestock.
Negotiable Instruments - Possession will prevail
over registration
Person who provides goods/services and retains
the goods have the priority until he is paid
Before Insolvency proceedings - interest
perfected before the insolvency proceedings
have priority as it has before the proceedings.
Enforcement of Security Interest
Rights of Secured Creditor
Extrajudicial or Judicial
1. Expedited repossession of collateral
Grantor’s default, creditor takes the possession
of the collateral extrajudicially, if it stipulated
and it can be done without breach of peace, if
not, he has to apply for court order and will be
entitled for expedited hearing
2. High ranking creditor to take over the
enforcement
If there is a secured creditor that has priority, he
can takeover enforcement. This right may be
invoked.
3. Retention of collateral
Creditor may retain full or in partial of the
collateral by sending a proposal to the grantor,
creditors and parties interested. In full
satisfaction, it cannot be granted if there is
objection after the proposal is sent(20 days) to
the parties. Partial satisfaction is granted if the
creditor received the affirmative consent in
writing of the parties within 20 days.
4. Dispose/sell the collateral
It must be an auction(sale), in present condition
or commercially reasonable preparation of the
collateral. Secured creditor must act in a
commercially reasonable manner, he is
conformity with the common practice.
The sale must be done in good faith, the entity
presiding the auction is an expert, there is no
collusive practices in auction, records of the
auction must be documented in writing and
maintained, the asset must be awarded to the
highest bidder and paid full at the conclusion of
the auction.
Seller must give notice 10 days before the
auction to the grantor, other secured creditor.
Creditor must post the description of the
collateral and details of the sale and made it
available to the public.
Government agency can conduct auction or
private entities, IRR will be submitted to the
Finance department.
Proceeds – will be applied to the reasonable
expenses of the thing, satisfaction of principal
obligation, claims of subordinate security
interest if written demand/proof is received
before the proceeds is distributed.
Excess – grantor is entitled for the excess
Deficiency – grantor is liable, creditor can claim
from the grantor unless if there is a stipulation
5. Special rights under PPSA
On default, these are the remedies
extrajudicially
Accounts Receivable – instruct the debtor to
make payments to the creditor
Negotiable Instrument - creditor can claim
satisfaction from the instrument or goods
covered by it
Deposit account – creditor may instruct the
institute to pay balance to the account of the
creditor, security agreement and affidavit is
given
6. Right to damages
Remedy of Grantor
Non compliance of creditor, the court may
order/restrain collection of the collateral
Right of Redemption, except grantor waived the
right, collateral has been sold, creditor retained
the collateral on retention
Rights of a buyer (Highest bidder)
HE acquires the grantor’s right free from other
rights of creditors
Lessee is entitled for the benefit of lease for the
period of term
PATENTS (IPL)
RA 8293
Patent – exclusive right acquired over an
invention, sell, use or to make the same.
Inventions that are technical solution of any
problem, in human activity. Requirements that it
must be new, involves an inventive step and
industrially applicable. It may relate to a product,
improvement or process.
It is to reward the advances of sciences and
technology, encourages dissemination of
discoveries and invention, it brings new design
into public domain using disclosure. Patents
protects investor’s ideas for a specific number of
years, and after the years it will go to the public
domain.
3-fold purpose
To foster and Reward invention, promote
disclosure of invention and stimulate innovation,
stringent for requirements protection, public
ideas remain for the use of the public.
Requirements
An invention is novel if it new and not part of a
prior art/invention. It also has an inventive step,
with prior art, it is not obvious to an expert
person of the art at the filing date. Last requisite
is that it has industrial applicability, it can be
produced and used in any industry.
If the invention is new and industrial applicable,
it may qualify as utility model, model of product
which is practical utility. It is not patented but
registered for the period of 7 years.
If an invention is new but not industrially
applicable nor no inventive step, it is not
patented but qualify for industrial design. It has
a special appearance or pattern for an industrial
product.
Excluded from Patent Protections
Non patentable – discoveries, mathematical
methods and scientific theories, rules of mental
act, playing games, doing business, programs for
computers, method for treatment of
human/animal by surgery, therapy or diagnostic
methods, plant varieties/animal breeds,
biological process of plants and animals,
aesthetic creations, works of art and anything
contrary to public order/morality.
Right of patent
It belongs to the inventor, heirs, assigns and co-
inventor (jointly). If two or more persons
invented the invention separately and
independent of each other, right of patent
belong to the one who first file the application. If
two application is filed on the same invention,
the priority is the earliest application. If filed
abroad and domestically, inventor can ask the
IPO to recognize earliest date, provided that the
local application must expressly claim priority,
must be filed within 12 months from the date of
earliest foreign application, certified copy of
foreign application with English translation.
If there is a patent, before the original invention,
the remedy would be to file petition on
cancellation of the patent on the grounds of he
is the true and actual inventor.
Invention through Commission
The commissioner is the owner of the patent
unless stipulated, if the employee made the
invention in the course of his employment
contract, patent is his or his employer. It will
belong to the employee if it is not included in his
employee duties, it will belong to the latter if it
is a result of his duties(employment contract)
unless there is an agreement.
Inventor is protected for the term of 20 years
from the date of filing, incase of utility model it
is 7 years and industrial design is 5 years from
application, renewable not more 2 times, each
term of 5 years.
Application of Patent
Inventor must apply in the IPO, subjected to
unity of invention. The application relates to one
or more invention that has general inventive
concept. IPO will search for a prior art to see if it
is new, then they will publish a document after
18 months in the IPO gazette. Within 6months,
the applicant submits a request for substantive
examination, where the IPO accepts or refuse
the patent.
Application already grants certain rights to the
inventor, civil action of infringement to any
person wrongfully exercising the invention.
Provided that, the offender has written notice
that the invention is subject for application or
subject matter of a published application.
Action may not be filed, after the grant of patent
of the published application within 4 years of
acts complained.
IPO can cancel in whole or in part a patent, done
in petition of any interested person in the
grounds of not new invention, not disclose in a
clear manner, contrary to public order or
morality.
Rights granted by a patent
1. If it is a product, he has the right to
prohibit any unauthorized person for
selling, using the product.
2. If it is a process, he has the right to
prohibit any unauthorized person from
using the process or product that used
such process
3. The right to assign, transfer by
succession and conclude licensing
contracts. In transferring it can be a
portion or while, limited to a specific
territory certified by notary public.
4. A patentee to exploit patented invention
through voluntarily or compulsory
licensing. Former, patent owner grants
other person to use the invention.
Compulsory, grant to exploit the
invention without the consent of the
patent owner in favor of any person
shown capability to exploit the
invention.
Limitations on Patent rights
The owner of the patent has no right preventing
third parties performing without his
authorization
1. Using patented product put by the
owner on the Philippine market
2. Act is done privately on a
noncommercial scale for
noncommercial purpose provided that it
does not affect the economic interest of
the owner
3. Act consist of making, using exclusive
purpose of experiments relating the
patented invention
4. Medicine in accordance to prescription
5. Invention is used on vehicle any other
countries entering Philippines
temporarily or accidental
Prior User – in good faith, using the invention
before the filing date of patent shall have the
continue to use thereof, may only be transferred
together with his business.
Govt – can exploit the invention without the
agreement of patent owner for public purpose
Infringement
Using, selling, importing of a patented
product/process without authorization of the
patentee, not only direct but also contributor
infringer is liable solidarity with the infringer. The
law allows the patentee to bring civil action to
recover damages from the infringer. Criminal
case for repeated infringement.
A machine/device has the same function,
process result by identical or substantial
identical means, mode of preparation is the
same to constitute infringement.
Literal Infringement test – comparing the two
inventions side by side
Doctrine of Equivalence – a device appropriates
a prior invention by incorporating its innovative
concept. It requires satisfaction of function,
means and result.
_______________________________________
TRADEMARKS
Mark can be a name, surname, joining of a name,
composite mark.
Trademark – visible sign that is capable of
distinguishing the goods of a firm, stamp or mark
container of goods. IF the mark is for services, it
is a service mark.
Tradename - a name or designation identifying
an enterprise or goodwill. Goodwill is a property
right, reputation. Trade name refers to name
and goodwill while trademark refers to the
goods

Collective mark- visible sign of distinguishing the
origin or common characteristics of different
enterprise under a control of a registered owner
of the mark.
Functions
1. Indicate Origin/Ownership of goods
2. Assuring the public of genuine products
3. Protects manufacturer from sale of
inferior product
4. Advertises the products or Silent
Salesman
5. Secures the fruit of labor/skill of the
person who brought the item to the
market, as the owner has the exclusive
right to prevent unauthorize/other
person using his mark. Applies to mark
that are not registered to the PH, but are
well known(internationally and
Philippines).
Owner of well-known mark can register the mark
in the PH to prevent the use in unrelated goods.
Compliance, there must be proof of mark
connection to the goods of owner. The interest
of the owner is likely to be damaged by the use
of such mark.
Doctrine of Secondary Meaning (distinctiveness
of trademark and names) – exclusive continuous
use of a mark, such marks loss its primary
meaning and now associated with particular
goods, is entitle to have the mark registered with
the IPO. To invoke this, there must be evidence
the longevity of the business, has acquired good
reputation.
Duration
Protection last for 10 years, renewable for
periods of 10 years in each renewal. There must
be request 6 months before or after the
registration.
Acquired by
Mark – registration
Name - adoption of the name
Laws of Names
1. Restrictions such as contrary to public
order or morals, or liable to deceive
trade circles/public
2. Registration is not required to enjoy the
protection of the law, but it is preferred
to register
Law of Trademarks
1. Acquired solely by registration
2. Priority right is given to applicant who
applies first to foreign then in the
country. He can oppose/petition to
cancel the registration or sue for unfair
competition without prejudice when his
registration is granted.
3. Registration by itself and grant, does not
vest ownership in the mark if the it is
proven that someone is actually the
owner of the mark. Ownership confers
the right to register.
4. Ownership of a trademark is acquired
through its registration and its use.
5. The proposed mark should not be
prohibited by law, it should not consist
of immoral and scandalous matter, it
must not disparage upon living or dead
persons, institutions beliefs, libel. No
insignias of the country/foreign is used.
No mark of living individual unless there
is consent. No mark to deceased
president during the lifetime of the
widow, unless there is written consent
of the widow. Mark misleading the
public is prohibited. It must not be
contrary to public order or moral.
6. For partly registrable/non-partly
registrable, he must disclaim the
unregistrable component and proceed
with the valid portion.
7. Certificate is given to the
applicant/assignee as evidence of
validity of registration, ownership and
exclusive right of use. It is required that
the registrant must file a declaration of
 actual use within 3 years of the filing of
the application.
IPO can cancel registration, any person with
reasonable grounds that he will be damage by
the mark, can apply for cancellation of mark to
IPO.
Part 2
Owner of the mark prevents another person
from using the marked product without his
consent. The owner can prevent and punish
violation.
Infringement – a registered mark is used in
commerce without the consent of the owner,
and that it caused confusion, the marks have to
be registered to be protected against
infringement
1. Committed by any person who used
reproduction, counterfeit, colorable
imitation, copy of a registered mark.
2. Any person who reproduces,
counterfeit, copy, colorable imitation,
and applied it to package, print, label
and caused confusion/deception in the
commerce.
Infringement happens when two of the
requirements happens regardless of sale.
Elements must be shown
1. Valid trademark
2. Ownership of the mark
3. Use of the mark/colorable imitation of
the alleged infringer and caused
confusion
Colorable imitation – close imitation calculated
to deceived the customers/purchaser
Two types of Confusion
1. Product Confusion – purchaser is
induced a product believed to be the
other
2. Confusion of business/ source or origin
confusion - the product is assumed to
originate to a registrant of earlier
product, the public is deceived to believe
that there is connection to two parties.
Two tests of Infringement
1. Dominance Test – focuses on the main
or essential feature of marks together
and confusion is likely to result, this test
is incorporate into law, it includes not
only visual but also oral, auditory and
other aspect.
2. Holistic Test – considers the mark as a
whole, if the buyer is deceived
attributable to the whole mark
Remedies of Infringement
1. The mark owner may file for damages,
the goods to be destroyed or
impounded. He may also pray for double
damages, wherein there is intent of
defrauding the public.
2. Ask for injunction to stop the use of his
unauthorize mark.
3. File for criminal case or administrative
sanctions
4. To be entitled for damages, he must
show that those acts are with knowledge
to cause confusion, fraud, and
deception. Knowledge is presumed, if
the mark is registered or with actual
notice of registration.
Law imposes limitation on remedies
1. Owner cannot sue for infringement to
third person who was using it in good
faith before the registration or priority
date.
2. The acts of infringer relate to printing,
distributing and the infringer is innocent,
he is only entitled for injunction to stop
future printing.
Goodwill is also protected created by the mark.
He has the property right towards the goodwill.
Unfair Competition
- Use of deception, means contrary to
good faith, by which he passes of the
manufactured goods by him/which he
 deals for those of another person who
established goodwill in the goods he
manufactured/deals with.
- Example: he manufactures goods but
clothes it with general appearance of the
other to defraud the public.
- Person who commits false statement or
commit act contrary to good faith to
discredit the product or business of the
other.
- Confusing similarity with the
appearance of the goods, intent to
deceive and defraud a competitor. It
may result to other factors such as
packaging, and presentation of goods.
Test of unfair Competition – test whether the
certain goods are intentionally clothed with the
appearance to deceive purchaser. The viewpoint
is from the prospective buyers.
Remedies are the same as infringement.
Infringement VS Unfair Competition
Nature – Infringement is from unauthorized use
of the mark, latter is from passing of one’s goods
as goods of the another.
Existence of Fraudulent Intent – it must be
established in unfair competition, not necessary
in infringement
Prior Registration of the Mark – It is necessary in
Infringement, but not in unfair competition.
Goods – Identical/similar goods in infringement
but may be in different goods in unfair
competition.
Section 169 (false destination of origin and
representation – allows the mark owner to file a
civil action for damages and injunction to any
person who uses container in commerce of
symbol, false destination of origin, false
description, misleading representation that are
likely to cause confusion or association of person
to other.
COPYRIGHT
Copyright – is an intangible incorporeal right to
certain literary, scholarly, scientific and artistic
productions granted by law to author of work. It
is protected at the moment of creation.
It is different from the material object.
It protects the original and derivative works.
Former is the works that are protected at the
moment of creation irrespective of the mode or
form of expression the content. The latter,
works that are derive from original work. This
includes dramatization, translations,
adaptations, arrangement and alteration.,
compilation of data which are original.
Not Protected by Copyright
1. Idea, procedure, method, system,
discovery, mere data
2. News of the day, miscellaneous facts
3. Official texts of legislative
4. Work of government of the PH, unless it
is exploited
SCOPE
1. Gives protection to the author and his
heir, and gives economic and moral
Rights
Economic Rights – derive money from
1. Reproduction of work or substantial
portion of it
2. Any transformation of the work
3. First public distribution of the original
and its copy
4. Rental of original or copy of the work
5. To carry out public display of the original
or copy of the work
6. Carry out public performance of the
work
7. Other communication to the public of
the work
Right to receive proceeds from subsequent
transfer of work. (Droit de suite) The author and
his heirs have inalienable right to receive 5% of
the sale and or lease of the work. The rule does
not apply to prints, etching, engravings, where
the author derive gain from reproduction.
Exists in the lifetime of the author and 50 years
after his death
Moral Rights – retains the following
1. To require that the work is attributed to
him in a prominent way during his
lifetime and perpetuity
Terminus – Same as economic rights (period)
1. Make alteration of his work prior to or
withhold it from publication
2. Object any modification/derogatory
action in his work
3. To restrain the use of his name in works
that is not his creation, or distorted
version of his work
Cannot be assigned, transferred or subject to a
license.
Who owns / how long
1. Original – Author owns it and last during
his life and 50 years after death
2. In case of joint ownership, coauthors is
the original owners of copyright, if there
is an agreement it is followed. If the
work is separable, the author of each
part is the original owner
3. In his course of employment, if the
object is not in line of his duty, it belongs
to the employee. If it is in line with his
duty, the employer is the owner unless
there is an agreement.
4. Commissioned work, the person who
commission the work is the owner but
the copyright stays with the creator
unless there is a stipulation.
5. Audiovisual work copyright belongs to
the producer, composer, film director
and author of the work. 50 years from
the date of publication or making
6. Letters/public communication are
owned to person who are they
addressed, cannot be publish without
consent of the writer or heirs
7. Anonymous /Pseudonymous work,
publishers represent the authors unless
contrary appears
Works of applied art 20 years, photographic
works 50 years from publication or making,
performance not recorded 50 years, sound
recordings 50 years, broadcast 20 years
Specific Economic rights to performers,
producers, actors. This is Neighboring Related
Acts
- Rights that belong to the actors,
performers, producers, composers,
broadcasters.
1. performers of literary or artistic works
50 years after death.
2. Direct or indirect reproduction of their
performances
3. Right of authorizing the first public
distribution of original and copies of
performance. They must receive 5% at
first communication
4. Authorizing the commercia rental of the
performances
5. Authorizing the making available
performances fix in recordings
Moral Right
1. They should be listed in the credits and
object distortion to any works and acts
created by them
Producers
1. Direct or indirect reproduction of their
recordings
2. Right of authorizing the first public
distribution of original and copies of
recordings. They must receive 5% at first
communication
3. Authorizing the commercial rental of the
recording
4. Authorizing the making available sound
recording
Broadcasting
 1. Rebroadcasting of their broadcast
2. Recording, making of films of their
broadcast
3. Use of record for fresh transmission or
recording
Registration
1. The owner of the copyright, register and
deposit two complete copies of work
prescribed by the library
Use of Copyright
1. Evidence of copyright
2. Facilitates enforcement of copyright
after the death of creator
Copyright exists when there is notice of
copyright bearing its name and publication, in
death, the year of such death.
Copyright may be assigned, licensed in part or
whole. Licensee/Assignee is entitled to remedies
of copyright.
If 2 or more-person own copyright, licenses is
granted only with the consent of the owners.
Infringement (piracy, plagiarism)
- Offender appropriates whole, part of
language of the work and passes it as his
own.
He Directly commits and benefits from it. With
knowledge, he contributes to the act of
infringement of the other.
It is a trespass to a private domain, therefore
protected by law. Doing in any way without the
consent of the owner of the copyright. Copying
must produce injurious effect. It is a crime that
does not take to account the intent of the
offender, it is the act of infringement that causes
the damage. Good faith is not a defense.
Remedies
1. Injunction to stop the infringement
2. Payment for damages
3. Impounding and destruction of the
infringed
4. Moral and Exemplary damages
5. Penalties for imprisonment (1 year (first
offense) -9 years (3rd offense to
subsequent offense))
Prescriptive Period -action is brought within 4
years
Limitations Copyright
1. Reproduction/Distribution in a
specialized format for the blind. (non-
profit basis, indicate the owner)
2. Performance of work when it is lawfully
accessible to the public, for charity or
religious purpose
3. Making of quotations from a published
work in fair use
4. Reproduction/Communicating of
articles, literary, scientific, artistic works
5. Inclusion of work in relation to public,
for teaching purposes in fair use
6. School recordings of broadcasts, and it is
deleted within reasonable period after
first broadcast
7. Temporary recordings of broadcast
8. Work under government
9. Work with no admission fee is required
10. Professional legal advice
Doctrine of Fair use – criticism, news reporting,
comment, teaching purposes is not infringement
1. Purpose of the use
2. Nature of the work
3. Amount of the portion use of the work
4. Effect of the use of the work
Fair use in compilation – is done to obtaining
information necessary to achieve
interoperability
Reproduction of Published Works – allowed for
research and private study
Reproduction is allowed, limited copies
1. The work is in fragile nature
 2. The reproduction is necessary to supply
a request
3. Is in order to preserve, to replace a copy
Reproduction of Computer Programs, once back
copy is permitted without the authorization of
the owner by the lawful owner of the program if
it is necessary
1. Use is in conjunction with a computer
with a purpose
2. Archival purposes, replacement

RA 10088 anti cam cording act 2010 – prevents

recording for any person to use or attempt a
recording device of a film or performance, or to
have in his possession a device to intent record,
to aid or bet or connive in the commission of the
prohibited acts. Any guilty is subjected to a fine
50k not exceeding 700k, prisonment of 6months
– 6years.